Investment Q&A

Q: I was comparing banks and was intrigued by comparison between these 2.
YOY, BNS is about 14% higher than CM, whereas 5 yr return shows both very similar return. Is there a merit in switch from BNS to CM,to take benefit of relative discount on cibc. Over longer term banks have moved in locksteps. thanks

Q: I sent a question early that came back as private. If I indicated for the question to be private, that was my mistake. I would prefer it to be public as we all learn from each other's questions and your answers.
Thanks

Q: For simplicity, the following list of stocks are close to equal weight in my RRSP portfolio. I want to add another full position of one stock. I am thinking of CM for dividend or TMR for gold exposure or another suggestion you may have. I included my TFSA holdings so that you can see all of my equities.
RRSP
Energy-ENF/RRX/WCP
IT-ESL/SYZ
Industrials-EIF/MAL/RBA/SIS/WSP
Utilities-BEP.UN/EMA
Consumer-MG/NFI
Financials-BNS/SLF
Health Care-SIA
Telecos-BCE/T
Materials-CHE.UN/SJ
Realestate-BPY.UN

TFSA
ADW.A/CCL.B/CSH.UN/DSG/ECI/GUD/IPL/PUR

Thanks and have a good weekend.

Q: Hi- the banks all seem to have done well, partially because loan loss provisions have been reduced. Is that a discretionary situation...in other words, can earnings be boosted by lowering provisions? How does that work?
How does it relate to Tier 1 capital? And what are the banks' Tier 1 Capitals now?
Thanks

Q: Good Morning
I hold 4 Canadian banks CM, TD, RY and BNS in an unregistered account. The bank stocks comprise just under 20% of my portfolio and each has approximately a 50% capital gain. My only other financial stock is a 2.5% position in PWF. Capital gains in my account this year will likely be taxed at 15%. I am considering selling one of the bank stocks (perhaps CM) and investing the proceeds in SLF. I have chosen SLF for it's relatively low valuation and secure dividend.
Is reducing the allocation to Canadian banks appropriate, or does the tax which has to be paid cancel the benefit?
Which bank would you sell?
Is SLF a suitable alternative or is there another company that you would prefer. I already have full positions in CNR and BAM.A.
Thanks
David

Q: I have a 4% weight in CM in a portfolio heavily weighted to financials. I have already crystallized some capital gains this year and was planning on waiting till next year to sell my remaining position in CM, proceeds to liquidate an investment loan. I have heard that the upcoming budget may change the tax hit to capital gains from 50% to 100% which would speed up my plans to sell prior to the budget announcement.
Based on your connections do you think it likely that the Liberals will make this change?
What is the date of the Budget announcement?
CM go s ex-dividend on March 23 so when can I sell and still get the next dividend payment? i.e. Is ownership for dividend purposes based on the selling or settling date? If settling date than could I sell on March 18 which would settle on March 23?

Q: I hold 4 of the big Canadian banks (BNS, TD, RY and CM), each with a half position, except BNS which has almost a full position due to its under performance. What is your outlook for this sector in 2016? Should I continue to add to my positions on weakness? I don't own any insurance companies and I own one U.S. bank (Wells Fargo). Is it hard to ignore the dividend yield of Canadian banks at these prices.

Thank you,
Jason

Q: CM dropped 1.59% today whereas the other big 5 can.banks did ok.Any reasons or news?,As always appreciate your usual great views & services

Q: Banks took a big hit at the opening. CM yielding north of 5%. Looks like a bargain. Agree/disagree??

Q: Hi & Ho Ho Ho
Now that CIBC (CM) is north of $100.00, do you forsee a stock split sometime in the new year?

Q: Good Morning Team
I am interested in finding a list of Rate reset preferred shares(including reset date and terms). If this is not available do you have a few recommendations?
Thanks and stay safe.

Q: Hello Peter
I recently sold a large Ontario bond that was yielding 4.4% and need to replace it with very secure dividend yielding equities in the 4% yield range. I have already bought some Fortis FTS and a small amount of Bonterra BNE. Now I am thinking of adding a bank and I see Commerce CM and National Bank NA are the cheapest banks and both have P/Es just over 10. The yields are both 3.97% and 3.98% respectively. I see Laurentian LB yields 4.3% but at a P\E of 11.6 and is presumably less secure.
When is CM likely to raise it's dividend?
I am inclined to choose CM and I would appreciate your advice and comments on which bank to choose and why.
Paul

Q: What are your thoughts on CIBC? (cm)

For whatever reason, CIBC seems to be the black sheep of the Canadian banks? Why is that? While TD and BNS seem to be talked about constantly, few seems to talk about CIBC.

Comparatively, the other Canadian banks are trading well above 2007 highs while CIBC still trades at a 15% discount to 2007 highs.

Given its strong earnings report today and 2 dividend raises in the last year, CIBC looks cheap compared to peers. What do you think?

Thanks

Q: I have positions in all the major banks, BMO,CM,BNS,RY,TD. CM took a big hit today and I can find no reason for it. Is this a forecast of things to come with CM? Hold, or sell and spread the money in the other four?

Q: Could I please have your comments on CIBC (CM) as a long-term hold? Do you think the stock price will recover once the Aeroplan situation is behind them? Thanks.