Investment Q&A

Q: Hello Peter and the 5I team

I have noticed a decent decline in the KBL share price. Do you see this as a good buying opportunity? My discount brokerage has some data on the company, PE of 25.6, PB of 3, ROE of 13.8, about an average of 2% div growth over the last few years and debt of 0. Do these numbers jive with your numbers?? Would you consider this a good buy for a long term hold or is there better more stable companies with div growth to go to? What is your opinion of Management? What are the possible future hurdles for this company?

Thank you

Q: Peter and team:
I am down 30% on G and it represents about 1/2 weighting (2.5%) in a portfolio modelled much after our BE portfolio.
I missed the switch to AEM when you made it last month. Would you still recommend the switch in light of recent movements by both. Also would you suggest topping up with cash to bring holding to full weighting(5%) at this time, or wait for a pull back. Time frame is 10 years+ (hopefully).

Thanks as always.

Phil

Q: Hi Peter and Staff
Just took your advice to another reader and dumped a small position in LRE- would like to use those $ to add to a small position in one of the 5 above? Which one and why please .
I have been away but add my name to the list whom Ryan impressed on BNN- very confident in his answers

Q: What do u think of a bought deal at these prices? Would u buy it?

Q: As a followup to John's recent question on VIX, the ETFs VXUP and VXDN have minimal liquidity on most days and appear to have poor correlation with the VIX. May I get your comments on using VXX and XIV as vehicles for trading S&P 500 volatility. These ETNs have excellent liquidity.

Thanks, Tim.

Q: I currently owed some Rona preferred shares and now that the circular is out what you do think someone holding these shares should do?If I wish to convert to the new series I must let my discount broker know.I did buy at a lower price so I am not in a loss position.I hold these shares in my RRSP. If the ex-dividend date is March 14/16 and I sell the stock after March 14,would I be entitled to the dividend?
Thanks
Dolores

Q: I have a 4% weight in CM in a portfolio heavily weighted to financials. I have already crystallized some capital gains this year and was planning on waiting till next year to sell my remaining position in CM, proceeds to liquidate an investment loan. I have heard that the upcoming budget may change the tax hit to capital gains from 50% to 100% which would speed up my plans to sell prior to the budget announcement.
Based on your connections do you think it likely that the Liberals will make this change?
What is the date of the Budget announcement?
CM go s ex-dividend on March 23 so when can I sell and still get the next dividend payment? i.e. Is ownership for dividend purposes based on the selling or settling date? If settling date than could I sell on March 18 which would settle on March 23?

Q: I have read your answers to 2 questions on this today and I believe your answer may be confusing some people. you have said both times, "you can sell UP TO AND INCLUDING the dividend date"
The up to part is not right as if you sell before the ex div date you will not get the div. only if you sell on the ex div date or after, not up to. Is this a misprint or am I reading your answers wrong?

Q: If you owned the Long Run debentures, would you sell them into the market right now, or wait it out? What do you feel is the current risk of the deal not going through at 0.75 on the dollar?

Q: I have limited exposure to Europe / Emerging Markets. Do you think it is a good time to invest in either of them and if so how would you do it? What are the best ETFs? Would you use a CAD hedged ETF/am I correct in understanding that buying a CAD hedged ETF would protect against the CAD appreciating?
Thank you as always.

Q: I will appreciate your detail financial analysis of this company.

Q: How would you compare Tmc and Ai atrium going forward ?

Q: Peter; I thought this was very interesting - particularly the performance number. Publish if you wish .RodThere are interesting items from a JP Morgan report on concentrated stock ownership called The Agony and the Ecstasy: Since 1980, 320 of the S&P 500 companies have been deleted for business distress reasons, 40 percent of all stocks have suffered a permanent 70 percent plus decline from their peak value, the median stock in the Russell 3000 index was down 54 percent, and two thirds of all stocks underperformed versus the Russell 3000 Index and for 40 percent, their absolute returns were negative. Those are tough statistics. Further, according to S&P Dow Jones Indices, and reported by Barron’s, just 18 percent of large-cap managers have outperformed the S&P 500 over the past 10 years.

Q: What do you think of SSP on the venture? I noticed back in 2010/2011 the stock price was around $10. What was the market cap back then and how many shares were outstanding in 2010/2011? How can I find that info myself? Thanks

Q: Wondering what are your current thoughts on Tamarack Valley Energy? Worth a little speculation?

Thanks

Q: Could you please comment on Franco Nevada's recent earnings. Do you continue to like this company at these levels and would you recommend purchasing shares at the current price.

Q: Could you speculate on the Canadian budget, in particular on the possibility of an increase in the capital gains inclusion rate? I do appreciate very much the service you provide. Thank you.

Q: Hi 5i: I've been looking at CVS for a while but I'm now thinking it might have got too expensive (I had thought that another dip was on the way). What do you think?

Q: Hi 5i,

I stumbled on Presm Watsa thoughts about retirement in today's Globe and Mail. Basically, he is close to see a new 1929 global crash happening rather sooner than later, with 2 ulterior decades of losses and tears. Quote follows:

In the past few years, Mr. Watsa has been troubled by a disconnect he sees between stock markets and the underlying economic instability of countries around the world, as well as the implication that deflationary conditions could have on markets. Fairfax cranked up the hedges on its equity portfolio to 100 per cent this year from 88 per cent at the end of 2015 – that’s how concerned management is about a possible financial storm.

For older investors, there might not be time to recover from the damage. Mr. Watsa’s worry is that a market downturn could mimic the stock market crash of 1929, where it took more than two decades for the Dow Jones to reach precrisis levels. And unlike the 2008 financial crisis, Mr. Watsa said, central banks are now mostly out of ammunition. “We just want to make sure people realize there are risks.”

As he is now 100% hedged (which is what, more exactly), for us, small investors, there is something similar that we could envision? Maybe to put all our money in Fairfax, and live happily ever after?!

Thanks as always for all you do for us.

Q: Amaya will be releasing year-end results after the market closes today. Could you please advise as to analysts' expectations?

Thank you, Peter