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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: My daughter is just beginning to develop a portfolio of ETF's as a substitute for a company pension which she doesn't have. She has 20 years of work ahead of her before needing to withdraw funds from her RRSP. Please suggest a diversified portfolio of ETFs that hopefully will increase in value by the time she needs the retirement income.
Read Answer Asked by Les on July 07, 2021
Q: Dear Peter:

In November/December 2015 issue of CMS, you wrote an excellent article on "Setting up a US Income Portfolio with call options". Even though I was/am not "into" options trading this has stayed with me as an idea for a "later time".

Now that I have retired and looking at enhancing my income, I decided to revisit this topic. Hence reviewed 5i Q&A section plus CMS archives.

It doesn't seem that you have written any follow up articles in CMS or for that matter in 5i. At least my search didn't yield any "hits".

My questions:

1. Do you think your article from 2015 is still valid? If you have written any follow through articles in FP or other magazines, will you be kind enough to share the links.

2. This strategy is good only to generate USD income? Any thoughts on Canadian stocks?

3. What are the optionable ETFs that I can write calls like you have mentioned in your article? My "boring" holds incl. VGRO/VEQT. I hope NOT to sell them for a very long time!

4. Any videos that you can suggest to a beginner who wants only a safe way entering this rather risky area of options? You had suggested two books to a subscriber's question in January 2021. I am looking for something that is visual.

5. Finally, internet groups seem to suggest that with impending correction it is better to employ "Puts" as opposed to "calls". What is your opinion?

Feel free to take as many credits as you see fit.

Many thanks.
Mano
Read Answer Asked by Savalai on July 07, 2021
Q: Gritstone Bio (GRTS) is a small, early-stage biotech company to which Gilead Sciences has provided some funding under an agreement announced on Feb 1, 2021:

"Under the terms of the agreement, Gilead will make a $60 million payment at closing, consisting of a $30 million upfront cash payment and a $30 million equity investment at a premium. Gilead will be responsible for conducting a Phase 1 study for the HIV-specific therapeutic vaccine and holds an exclusive option under the collaboration to obtain an exclusive license to develop and commercialize the HIV-specific therapeutic vaccine beyond Phase 1. Gritstone is also eligible to receive up to an additional $725 million if the option is exercised and if certain clinical, regulatory and commercial milestones are achieved, as well as mid single-digit to low double-digit tiered royalties on net sales upon commercialization."

GRTS share price has established a baseline after falling steadily since the funding announcement. Presumably Gilead did some due diligence before investing its own money, but the stock price could go to zero if Gilead walks away. However, it could also soar if the trials are successful. Would you consider GRTS to be a worthwhile speculative buy? What has been your experience of investing in early-stage biotech companies that have drawn the attention of Big Pharma?
Read Answer Asked by David on July 07, 2021
Q: Hi 5i,
I have been watching Alaris and waiting to buy it. Today it broke through to a new 52 week high on above average volumes (247K vs Avg of 162K). Do you think the recent investment in Vehicle Leasing Holdings is the reason for this move up or some other reason? Do you consider the time is right to pick it up now? Thanks
Read Answer Asked by Gordon on July 07, 2021
Q: Few of my international holdings pay dividends and in trying to correct that, I thought of adding SDIV as a new holding. I have the following questions or concern:
1. Many companies held in the ETF are on not that large (for the type of internatinal business a Canadian might want to risk); and
2. SDIV also underweights quality and momentum.

Notwithstanding the above concerns, would you say the ETF is worth adding as part of one's holdings outside North America? Please comment on SDIV, but if you have other ETFs you prefer, kindly advise). Thanks
Read Answer Asked by Adam on July 07, 2021
Q: My KXS shares have recently doubled and haVE exceeded my arbitrary 5% holdings threshold . I have a long term view of my tech holdings but wondered if you think selling off some KXS for Topicus or LSPD (or both) is worthwhile for some added growth for the next 5 years?
I am not adverse to holding onto to KXS if you think it could revisit its historical high in the next 12 months.
Some shares are in a TFSA and some in a registered account.

Thank you for your continued support.

Kevin
Read Answer Asked by Kevin on July 07, 2021
Q: I've been a holder of Calibre Mining for a while, and I'm getting a little worried about its slide downhill regarding its share price. I think the company should be making good money. Is there anything of major concern here (debt, balance sheet)? Would you consider it a HOLD? I'm bullish on precious metals.
Read Answer Asked by Ed on July 07, 2021
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