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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: I am recently out of university and have gotten a full time job with a defined benefits pension plan. I have 25-30 years before I am going to retire and want to start developing my first portfolio. I have lots of room in my TFSA and RRSP. I have a moderate risk tolerance given the pension plan.

I currently have $50K to invest. I would like to build a portfolio with a mix of some of your balanced and growth model portfolio stocks.

A few questions for you:
1) How many stocks would you recommend be a good starting point for me? Or would you suggest that ETFs would be a better approach for me given the amount of money I have to invest initially? From reading the forums I get a sense that I need to ensure a certain amount of portfolio diversity.
2) If I were to invest today, what stocks would you recommend from your BE and growth portfolio for the long term (20+ years in my situation).

Feel free to dock as many credits as you feel appropriate.

Thanks so much for your service. I have learned a lot since becoming a member and look forward to being a member for a very long time.
Read Answer Asked by Justin on July 14, 2017
Q: Can you give your thoughts on CDZ in light of the following Globe commentary (similar to other blurbs I've seen in the Globe):

"And another thing: The way some dividend ETFs weight their individual constituents is a bit nuts. Take the iShares S&P/TSX Canadian Dividend Aristocrats Index ETF (CDZ). Choosing stocks that have raised their dividends regularly, as this ETF does, is a great strategy, but assigning the largest weightings to stocks with the highest yields is a problem. Why? Because a high yield is often a sign of a struggling company whose dividend is unsustainable.

Case in point: At the end of April, CDZ’s largest holding was Aimia (AIM), which at the time yielded 8.8 per cent. But the loyalty plan operator’s shares collapsed in May after Air Canada said it would be parting ways with Aeroplan, and Aimia recently suspended all dividends. CDZ’s top holding now? Corus Entertainment (CJR.B), another struggling company that yields about 8.7 per cent and hasn’t raised its dividend since January, 2015."

https://www.theglobeandmail.com/globe-investor/investor-education/im-still-waiting-for-the-perfect-dividend-etf/article35453106/

Would you recommend a switch to a different ETF for broad-based Cdn exposure in an RRSP? What alternatives do you like that are not over-exposed to financials/materials?
Read Answer Asked by Chris on July 14, 2017
Q: Hi 5i Team
We have approximately $80,000.00 US cash to invest. Thinking of buying XHY for income to cover some of our expenses for property we have in US. Would like your opinion. It would be approximately a 5% position of our portfolio. In the event you think it would be a good idea, do we deploy the funds gradually or take the full position at once, obviously it would be based on what is available for purchase. We would probably us our TFSA account. What would you suggest. Thank you. Heather
Read Answer Asked by Heather on July 14, 2017
Q: I have several questions re:EIF. What is the latest available short position on EIF? What percentage of the public float does short position represent? Have you been following the latest short report and the updates to it by a well known short seller? What sort of investors is he trying to enlighten as to the perils of investing in EIF? With over seven million shares traded in the last twenty days, has this stock now become one to trade if one is a trader?
Regards AEO.
Read Answer Asked by Alan on July 14, 2017
Q: I own a fair bit of PHM, mentioned in a past comment, bought at 15 cents.
I noticed today that the debenture below just hit 52wh.
Patient Home Monitoring
PHM.DB-X
85.00 / 57.50
Question: if I want to add to my position, would the debenture be a better option or should I stick simply to the stock.
Thanks,
CDJ
Read Answer Asked by claude on July 14, 2017
Q: Good morning from the West Coast. My question is about diversification. I have purchased CDZ. I would like you to recommend an equivalent ETF for the USA please.
Thanks
Rick
Read Answer Asked by Richard on July 14, 2017
Q: Jerome Haas mentioned that manufacturing of the buses is in China. Checking their website I find claims that they are Buy America compliant as well as having Atlanta GA in brackets after one such claim. They don't say specifically where manufacturing takes place but do list a global Chinese company as their manufacturing partner.

Can you clarify where buses are actually built, and how they can be buy America compliant if they are built in Chinna.
If built in China and buy America compliant, are they using a "loophole" which leaves them exposed to changes.
Read Answer Asked by Bryon on July 14, 2017
Q: As a recent subscriber and investor, I note that several stocks that I own have the option of DRIP. My portfolio is large enough that the quarterly dividends allow for a substantial purchase of new or existing additions to stocks, like CAE or Boyd. As the cost of buying the stocks is not overly impactful to the purchase, is foregoing the drip, and the 5% discount, advisable, in order to allow a choice in selecting stock picks?

Thanks. KC
Read Answer Asked by Kelly on July 14, 2017
Q: Hi team
I have a half position on the above except for ZCL which I sold it earlier for a small gain, which one of the above would you add on to the postion from my cash ? Thanks
Michael
Read Answer Asked by Michael on July 14, 2017
Q: Hi 5i team,

I am trying to save to retire early or if the doesnt happen then just have much more saved when I do. I know I should max both TFSA for my wife and I, but how much %-wise should I put in a registered vs a non-registered? I'm stilll 14 years away from my ideal retirement date and about 24 from my latest. Right now I have about 30% of my total saving in a non-registered account, and have yet to max out my wifes RRSP but should I just put it all in a registered account then use just the TFSA for liquidity? I'm sorry if the question is not quite within the purpose of 5i, but I do value you guy' opinion highly.

Thank you
Read Answer Asked by Jerry on July 13, 2017
Q: I am retired and consider safety and a high dividend yield with growth potential important.

I am a fan of the Brookfield companies and hold both BEP.UN and BIP.UN

My concern with BEP.UN is that RBC estimates its 2017 ACFFO payout ratio at 109% and may stay elevated for several years. It believes it to be fully valued and its share price is above target price.

I know you like this stock but should I be concerned? Thanks

DEREK
Read Answer Asked by Derek on July 13, 2017
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