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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: Given the poor performance of this Brookfield subsidiary since the spinoff do you see the possibility of BN taking it private as they did with Brookfield Properties? I believe BN felt that Brookfield Properties was not valued correctly by the market and saw an opportunity to take it back in house. Could the same scenario play out with BBUC? Thanks for the great service that you provide.
Read Answer Asked by Anthony on August 29, 2023
Q: Retired, dividend-income investor. I have funds available over time to invest in / top-up some of my positions to meet long term asset allocation targets. I plan on continuing to invest these funds over a number of months...as I have been over the past 8 months.

The question is = in what order do I buy the following = XST, XIT (several BNN-ers say to avoid adding to technology at this point), BCE, BNS, LIFE, ZUT.

One method is to wait for these securities to hit my price targets (based on hitting a combination of fundamental and technical targets (a little bit is kind of bottom-feeding).

A 2nd method is looking at setting the order of buying, based on where one thinks each security is relative to their historic value.

Ignore asset allocation...these are smaller amounts and the AA is reasonably good right now.

My suggested order, subject to where each security's price is at (please shoot holes in my plan):
Sept = BNS,
Oct = XST-#1 (in 2 tranches-spread out),
Nov = ZUT-#1 (ditto),
Dec = XIT-#1 (ditto),
Jan = XST-#2,
Feb = ZUT-#2,
Mar = XIT-#2,
As each hits their price target (minor adds) = BCE, LIFE.

Please state your order and why.
Thanks...much appreciated...Steve
Read Answer Asked by Stephen on August 29, 2023
Q: In an answer to John you stated that you would expect ZWU " would likely retain its' share price better than UMAX " . Though UMAX hasn't been around long enough for a comparison I think one can speculate on what return might be expected as fifty percent of their portfolio are utility stocks with no calls written on them . So I would think the capital gain would be fifty percent of the utilities index. For example if the index returned 8% annually UMAX should return 4% which would reflect the percentage of the portfolio that is stocks { half the portfolio }. I would think that might be a good educated guess ..... ZWU on the other hand has been around for a while. So my question is has ZWU historically beaten fifty percent of the annual return of the utilities index ? And what has their historical annual percentage been compared to the utilities index ? ......
What I am shooting for here is a way to calculate whether the difference between ZWU's return and the utilities index return is enough compensate for a 5.6% lag in yield between it and UMAX ...... Thanks Garth .....
Read Answer Asked by Garth on August 29, 2023
Q: Wow, 13.7 % is almost too good to be true ; is it ?
This would seem ideal for my RRIF ; a very high yield on solid Canadian companies. Will the covered call aspect make distributions fluctuate ?
I need clarification on the last sentence of your response to John today:

“ZWU will likely retain its share price better than UMAX. “

Are you saying ZWU will not go down as much as UMAX or go up as much ( or both ) ?

Thanks . Derek.
Read Answer Asked by Derek on August 29, 2023
Q: These are my wife's holdings in her non-registered account. Held these for very long time. EMP.A I bought for her maybe 5 years ago when down a lot. Sitting on a fair bit of cash. Thinking of adding to banks at some point (recession?) or adding BCE and EIF? T is small holding at 2000 shs. Comments/suggestions please. Oh, own ETF ZUE for quite a while also. RRSP has other banks +++
Read Answer Asked by James on August 29, 2023
Q: I am looking at yield opportunities in preferreds given where we are in the rate cycle. Could you please comment on buying high yield individual preferreds from stable companies such as Enb ridge as a strategy, and also why their spreads vary so much. In these two releases the yield for the same company goes from the 6 to 9% range, when the stock yields in the 7s.
Thanks!
Read Answer Asked by Peter on August 29, 2023
Q: Hi, what is your opinion on these minimum raté reset prefs? An 8% yield seems interesting given the solidity of the issuers. Am I wrong to assume that they will one day go back to 25$ ? Even if it takes 5-10 years the total return potential and risk/return ratio seems pretty good (especially in a non registered account). Thanks!
Read Answer Asked by anthony on August 29, 2023
Q: Subscribers sometimes ask 5i for the current P/E versus the historical P/E range on a particular stock. Is there a reliable, free and user friendly source of historical P/E ranges on Canadian stocks?
Read Answer Asked by Edward on August 28, 2023
Q: I keep seeing and hearing questions about interest rates going down. I'm in my 70's. I had my first mortgage in 1985 at somewhere between 10 and 12% after my family helped me scrap together the 25% down required at that time.
I think interest rates are just normalizing (see https://www150.statcan.gc.ca/n1/pub/11-210-x/2010000/t098-eng.htm) and I do not understand why anyone would think rates would go lower? Could you explain?
Read Answer Asked by Stephen on August 28, 2023
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