Investment Q&A

Q: There is something I'd like to share with your members. I've been tracking 3 portfolios in detail for the last 18 months. One of them is a "couch potato" self-directed account, one is a mutual fund account while the third is an RBC "wealth management" account. The top performer believe it or not is the self-directed account!
It would seem that the outrageously high portfolio management fees in Canada are indeed not justifiable (based on my limited findings at least).
I am writing this message to add my simple voice to the growing chorus of individuals managing their own financial affairs. It works! I hope this simple message will encourage your members to keep on the path that they're on.
Now for my question - in another response you mentioned that brokers add to their revenue stream by "lending clients equities held in brokerage accounts" to short sellers. What percentage of a typical brokerage firms's revenue would be derived this way?

Q: I have held rie for many years as a core holding In the last week it has been under a lot of pressure .Don't know the reason but is it time to move on
Kind Regards
Stan

Q: Hello-
I hold a bit of HWO- High Arctic Energy. It seems to be finally getting noticed. With a low payout ratio and PE and 4.5% dividend, I am thinking of adding to my position. What do you think?

Q: Artis, which has been heavily tainted by the Alberta economy collapse just sold C$171M of AB properties bringing their YTD total of liquidated properties to approx C$340M+. With AB's economy stabilizing with the price of oil, does all of this give AX.UN a good chance at a strong SP recovery over the next 6-12 months?

Carl

Q: Hi 5i team,

Now that shareholders have approved the plan with Loblaws what happens next. The current price is $3.09 with little volume. Documentation I received mentions that shareholders would receive money for the shares next year at 3.10 per share. From a tax perspective it would be better to receive the money this year. Does one typically sell at market 3.09 in this situation or wait tying up the money which could be reallocated.

Thanks Mike

Q: BEP.UN seems to be struggling a bit lately. Is there an ongoing problem currently ?

Q: Hi 5i, just a follow up to the comment on the BNN guest who mistakingly described Exchange Income Fund. Later in the show after realizing his error he apologized. At the time I also questioned his description.
Dave

Q: Sorry for bringing up yet another question on this company but you recently answered a question about State Street Capital and in that answer, you seemed to suggest that the alternative mortgage market is not an area that you suggest for investment. First, is HCG considered to be an alternative lender and second, was your answer in response to making a specific new investment in State Street or should companies in this sector be abandoned altogether?

Appreciate your insight.

Paul F.

Q: Good morning. Did you see Wednesday's Market call and specifically the guests review of his past pick's ? I thought his review of Exchange income which was up 41% on the year was lame. He claimed it was some obscure company in the restaurant business. He seemed totally unprepared and not in a position to review the company at all.

Q: Hi, is this press release, specifically issue of 147k stock options, of any significance ? Also, any comments about stock price stalled at $10 level, lately. Thanks

Sylogist Senior Management Change, Issues Options
17:51 EDT Monday, October 03, 2016
CALGARY, ALBERTA--(Marketwired - Oct. 3, 2016) - Sylogist Ltd. (TSX VENTURE:SYZ) ("Sylogist" or "the Company") is very pleased to confirm, following its announcement on August 12, 2016 that effective October 1, 2016, Mr. Xavier Shorter, CPA-CA (Canada) and CPA (USA), has assumed the role of Vice President, Finance and Chief Financial Officer. Concurrently, the directors of Sylogist have granted senior employees, other than existing officers, Mr. Shorter and an outside director an aggregate of 146,666 options to purchase common shares at the current market price in accordance with the Company's Stock Option Plan.

Q: I am concerned about EIF's debt to equity ratio and the potential of aviation fuel increasing with the price of oil stabilizing and potentially rising. On that note, was the decline in fuel price a key contributor to their recent past profits? I do like the depth of directors and management. I'm inclined to think that their FAR NORTH aviation markets are a barrier to entry in and of itself and they have the market captured. Don't know if I should continue to hold or liquidate? Can you help me decide?

Carl

Carl

Q: You have often mentioned that you like to hold some gold in a portfolio as "insurance" but I am wondering how this strategy differs from that of holding a well-constructed portfolio. To me, insurance is something that pays out cash when things go bad. I understand that gold can be that asset that increases in value when things go really "bad" but is the suggestion that you would then sell the gold at that point? If you don't sell then, isn't the value of gold likely go down once things recover and other than a portfolio that stays even on paper, at the end of the cycle you really haven't created any new wealth. My concern with gold and gold mining companies is that these assets don't seem to create long-term wealth and would, therefore, be more appropriate for a person with a trading strategy than an investing strategy.

Thank you and appreciate your insight.

Paul F.

Q: From Oct. 3 : Q: A headline article in Globe and mail " Why it feels like another financial crisis ----" gives a current p/e for the tsx of 23.6 Your macroeconomic report has it at 17. Is this a difference between trailing and forward earnings or am I missing something?/
5i Research Answer:
There is a difference between current and forward earnings multiples. For example, based on data from Thomson Reuters, the current P/E for the TSX is 17.2x and the forward P/E shows 16.7x. Some publishings do not distinguish between forward and current when reporting P/E so one may see differences from time to time. However, the P/E quoted by the Globe looks to be high regardless of the timing perspective. Different services also seem to use different sources of estimates; we do see 23X on some other services, but simply defaulted to Thomson here.

It seems to me that the difference between 17 and 23 is a significant distinction and would indicate the TSX is in overbought territory if the latter is true. A subsequent article in ROB on Oct 4 produced a chart (source Bloomberg) showing the PE ratio for the TSX "Composite" at 23.5 and the highest in 14 years with the widest gap with the US since 2009. Is it possible 5i Research data from Thomson Reuters is utilizing the smaller sample from the TSX "60" or another index to arrive at 17X?
How to know what the true number is for sure?

Q: I just read a globe and mail article on line about changes in short positions between the 15th and 30th of September. This article shows a short of 100,000,023 which is over 10% of the o/s shares. One, how is this possible and two, how do I find out whether any of my shares are being loaned out for this purpose?

Q: Good Morning 5i
Please provide your comments on the significance of today's company update. Does it represent any news that would increase the value of the company? Or simply reassuring confirmation of previous information. Drilling results are not being reported now until later in November, including info on additional Doris site results. Appreciate your comments on effect today's release (and lack of drilling results) may have on SP.
Thank you.
Randy

Q: If you were unfortunate to have a full ( and under-water ) position in Alcoa , would you dump it now or wait for the split ... The prospective new company , Arconic could be OK, especially if it will be similar to Precision Cast Parts - but most analysts don't see any recovery in Alcoa if global supplies continue increasing .
I don't know the best strategy .
Thanks
Tom

Thanks
Tom

Q: Your opinion on Nevsun Resources (NSU.TO)
is appreciated.
How about their dividend history?
Thank you very much.

Q: This micro cap has attracted attention from CSCO and has recently attracted $500M in new business and renewals. It appears poised for incredible growth.
If so, can it manage that growth; will its balance sheet take a dangerous hit to achieve it etc.?

Q: I am looking to add some Brookfield Business Partners shares for a long term hold in my rsp (5 years). Where would you rate this company on a risk reward scale for this type of investment.

Thanks for your great work.

Q: What are your thoughts on ATVI -- Activision Blizzard -- in terms of growth prospects and soundness of balance sheet. If it meets your approval, is this worth a full position in a portfolio -- which for me is 4%. ( I couldn't find any other mention in your archives, even though I was certain you had addressed this company's prospects at one time.) Thank you for you help. (Notwithstanding that this is NOT your area of focus, I always value your opinion.)