Investment Q&A

Q: I’ve held BNS shares in a DRIP over the past 10 years. My ACB is about break even. I obviously chose the wrong bank as I would have done much better holding RY, TD, or NA over the same time period. Since I’m in a position to sell and not pay any tax, would you suggest switching over to one of the other big five or simply stay the course? I’m a long term investor and plan on leaving this money for my estate. Thanks for your insight.

Q: I am looking to add one financial stock to me RRSP portfolio. I currently have TD as the lone finance company. I also have BNS , TD, BAM.A and VISA in other portfolios. Can you give me some names - US and CDN - that I can take into consideration. Preferably those with a safe, good and growing dividend. Your comments are greatly appreciated.
Thanks

Q: Hello,

My partner and I heard about 5i from a friend whose been using you for many years. You came with the highest recommendation.

I feel like I should be copying one of your portfolios, especially due to my lack of knowledge, but it is very important for me that my investments to follow my ethics.

I would like to know which companies on your balanced and growth portfolios would be highest on positive environmental, social and corporate governance, which are low and should be switched and for which companies. I'm happy to do research, but I'm struggling to navigate the important statistics and feeling incompetent in finding good resources. I have seen your ESG scores (https://www.5iresearch.ca/blog/ESG-tsx-companies) and would be keen to know where to find information on how they are created. I would also appreciate other resources that you think would assist in building a portfolio, or simply which companies you would put on it.

Thank-you,
Ellen Perkins
Ucluelet BC

Q: Portfolio Analytics indicates I am over allocated and perhaps over diversified in Financials: BAM.A 2%, BNS 2%, TD 4%, X 2%, BRK.B 4%, MA 6% and Industrials: CCL.B 1%, CNR 4%, NFI 1%, FDX 3%, HON 3%, LMT 6%.
Which positions would you recommend trimming or eliminating?

Q: I own all of these (similar amounts) and bought LB to boost income. Now its yield is less than the other two do you think it makes sense to switch into the other two? Thanks.

Q: Why is BNS down more than the other big 5 banks?

Q: Hi-
Is the number of close to 90% payout ratio for BNS correct? Do loan loss provisions factor into that payout ratio? I would assume yes. If so, I would consider 90 percent not particularly alarming considering the current economic environment. This would cover delinquencies after the 6 month mark, correct?

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: Based on quarterly results and statements from CEO Porter on BNS’s liquidity and loan losses, if I didn’t have any bank positions right now, would you start a position in BNS now or wait a bit or would you prefer a different bank?

Q: what is expected from earnings this quarter? Thx

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: Morning
Currently I hold CIBC. BNS. TD ROYAL
All are down
Would it make sense to sell cibc and top up TD and BNS.?
Thank you for your calm approach these days
Michael

Q: This is in response to an answer you gave on an earlier question today. As you may have gathered I am rather new to options. I wonder, first of all, whether you might be able to suggest a resource to understand the basics. I have been doing well but have stayed pretty close to the bit I do understand. Mostly covered calls. But, related to the question I asked earlier about the covered call on TD, to avoid capital gains, could I not buy back the call before expiration? I know this might cost me a bit of money. But, it would allow me to take the chance of trying to make some option premiums on some of the stocks I own, without the worry about capital gains and taxes. I am not familiar enough with this to know, though, whether it could be a useful strategy.
thanks

Q: Hello 5i,
This is a general question on investing. Say if i own TD, for instance, and i don't want to lose it, or something similar to it. Is it a reasonable practice to sell a covered call on TD and at the same time and roughly the same date, sell a put on something like BNS. I don't really mind if i end up owning the both of them, either.
Thanks

Q: I am retired and rely on dividends. I have owned JPM,RY,TD & BNS for a while. The only bank that I am in a loss position is BNS. I am thinking that BNS will continue to lag the other 2 due to the latin america markets they operate in and the ability of these markets to recover from Covid 19. My thought is to sell BNS and put that money to work in TD. Your thoughts?

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: I depend on the big 5 banks and, to a lesser extent, the telecoms , for income reliability.
For example, I read recently that BMO has a 191 year (?) record of uninterrupted dividend paying.
Are you able to list the payout records for the other listed above.
Thank you

Q: Wells Fargo has taken a big hit recently. Do you think it might be worth buying some shares in this bank? Is the dividend yield (currently at about 7.4%) sustainable?

I have held BNS for quite some time and am down about 20%. Just wondering if I should add to my position (about 1% of my portfolio) or sell. I am assuming that the high dividend will keep being paid (as most experts say Canadian banks don't cut dividends).