Investment Q&A

Q: top 3 american, top 3 canadian, banks to invest in ?, and a reasonable projection and why, or do you not recommend banks at this time?

thanks

Q: Do you feel there is a need to go into the US to get additional financial exposure, into something like GS or JPM? Or would RY be sufficiently diversified given its size, and international diversification.

Q: Top 5 picks for monthly income please and thanks.

Q: Is this a good time to be investing in banks? Any preference between TD and Royal?

Q: if I want to received dividend in US , will it be advisable to buy co. like Enb. in U$., or other dual listing companies, like RY,TD. or will it be better to simply buy equivalent US listed Co. instead. Thank you as always.

Q: If you have to to invest in a Canadian bank now, wich one would be your first choice, thank you

Q: What are your thoughts on selling these two bank stocks I am about 25% down on both going on three years , thinking of buying Td or Ry.
Larry

Q: Re Fred’s question about longterm gains on RY
canadastockchannel.com has this info
If bought on Jan4, 2000, $1 worth of RY would be worth $12.46
assuming dividends are re-invested on a tax free basis (ex. RRSP)
If dividends are not re-invested, on a total return basis (including dividends, but still no tax paid) your $1 is worth $8.75.
You can enter different dates to get exactly what you want.
I personally find this type of analysis instructive but I know not everyone is a fan.

Q: If I had put $100,000 into RY 20 years ago with all dividends reinvested, can you tell me what it would be worth today?

This is not a rhetorical question. I recently came to realize that a close friend put $100,000 RRSP into RY in 1989 as he has now retired from there. As he is an unsophisticated investor, he just left it there. But as there have been withdrawals over the years, it is difficult to determine the actual growth. It is now worth a tidy little sum. This is, in my estimation, a significant argument for a buy and hold strategy although most would also argue for more diversification.

Q: hi, dear team
for banks or reit which one your guys is a good buy now for long term investment ? like ten years.

appreciate!

Jacky

Q: BNS is up AFTER they posted loss, increased reserve provisions etc., BUT it seems ALL the banks are up today even though news about their future is still pending!
Should we "read" that "birds of a feather" phenomenon is operating here and the market has decided to ignore the pending results of other bans and is into a full blown buy mode!
Do you think it is risky or reasonable response to the current situation and one can buy bank stocks now? I know your favorites are RY,BNS,TD.

Q: Hi All:

With the negative feeling about banks for loan loss, etc. I wonder if I should let go either TD or RY or both and take the loss, then watch to buy back later. the total market value is about 3.7% of my total portfolio, and each one is almost equal in market value. The loss in TD is 19+% and RY 15+%. I also own NA with a gain and only 1.5+% in my portfolio.

Thank you.
L

Q: What do you think the main reason for the current decline is among these banks. Is it fear of loan losses, fear of what the companies are to report next week or the sell in May mentality? How much pessimism is baked into these stocks already?
Thanks, Mike

Q: Not only B of A (today's Globe) but quite a few analysts and BNN Guests say that Canadian Banks are going to take a hit b/c of earnings, poor reserves, Loan write offs etc., With that in mind is it worth selling BNS,RBC,TD and buy them back later ? In RRSPs/TFSAs. So, capital gains/loss is a non issue. I "lose" 60 $ in trading fees. But selling now can save me from losing a lot more if they tumble a lot AND I don't have to wait for a longer period of time for them to recover. ( You know the cliché, if a stock goes down by 50%, I have to make 100% to break even!)

Q: Can you please explain the losses in the big five Canadian Banks shares. I can’t for the following reasons so would appreciate your thoughts before I start to increase my exposure.

Their mtge portfolios are mostly insured , ultimately by the govt. the balance of their mtge loans are normally at significant discounts to the property values.

The new loans being made by the government will likely be backed by the government , not the banks.

They all have a long history of not cutting dividends, BMO has not in 190 years and BNS in 188 years and I expect the other three banks to be in the same approximate time frame of no dividend cuts . Unlikely you will find a US back or an Insurance company that can say the same.

They also over reserve their loan loss provisions in order to keep their profits from the wild fluctuations we see in the US.

Thanks

Q: I own TD and BNS. BNS has underperformed for years. I was thinking of keeping TD, but replacing BNS with RY. What are your thoughts on this?

Q: Given that my Margin account has the 5 big banks and 2 Telecoms paying dividends on a periodic basis and that I'm not "too" concerned that these will cut their dividends, would it be wise to implement trailing stop loss orders for these in case there is another retest of the lows of March. Had I done that at the beginning of the year, I could have picked up the above at much reduce prices with resulting greater dividend yields. And would using the same procedure for my RIF account (which has mainly REITs) be beneficial to capture the current values to avoid further losses there.
Your comments. Thank you

Q: Hi Peter: When I sit back and take a look at the big picture and review how my portfolio performed during COVID-19 (so far), I try to see what lessons I can learn, then turn to how to apply those lessons to make my portfolio stronger.

I am a retired, dividend-income investor. I am a huge believer in asset allocation and have designed a portfolio, in my opinion, to be reasonably well diversified, although heavy to Canada. It WAS roughly 70% equities (including 32% foreign content) and 30% fixed income (roughly 15% insured annuities, 15% Fisgard Capital...both averaging in the 5-6% pre-tax range and minor cash). My equities are mostly blue chip, dividend payers, as you can see above. The 3 mutual funds are a very minor part of my portfolio, especially Eric's Energy Fund (<2%). I also receive a company pension and CPP-OAS which, when included, drops my equities to roughly 32%.

I use various metrics to monitor my portfolio, such as P/E, P/BV, P/CF, P/S, Beta, ROE, Div growth, Payout%, technical indicators like 200 mda. I am normally a buy-and-hold investor who trims/adds around a core position.

Periodically I measure how "at risk" my portfolio is relative to the overall market. I do this by prorating my portfolio using Beta. Based on equities only, I averaged 0.68 and for my entire portfolio I averaged 0.44. So, one would think that if the overall market (TSX) was to drop 30%, then I would have thought my portfolio would drop 44% to 68% of that, being in the range of 13% (overall) to 20% (equities only).

In actual fact, my entire portfolio dropped 27% from peak to trough vs the expected 13%...over double! I understand that EVERYTHING was sold off...almost no exceptions. So what do we learn from this and what changes should we consider? Do we accept that "sxxt happens" once in a while...you can't predict every event, accept it and move on? Should we consider increasing the cash component as a buffer? Or...is there something else to be learned here?

Thanks for you help...much appreciated...Steve

Q: I have all 5 big banks and the 2 telecoms in my Margin Account for income purposes. I sold FRU and IPL because the dividend was reduced significantly. So I have some cash available to top up.
Given the Banks have Yields and Pay Out Ratios as follows (BMO 6.34% - 46.83%; BNS 5.90% - 44.47%; CM 7.49% - 36.67%; RY 5.25% - 44.84%; TD 5.82% - 44.76%) I am considering CM as the best yield and lowest Pay Out. Would you concur?
Thanks

Q: Hi,
Could you please comment on commercial impaired loan growth with respect to the Canadian banks prior to the Cov 19 crisis ? Have they increased their reserves appropriately ?
Thanks