Investment Q&A

Q: Dear 5i,
For a Feb 1 question about WN vs L you mentioned that you typically prefer operating companies to holding companies. Could you clarify a bit more, please? Is it because the operating company would reap more benefits from its growth than the holding company? If so, would the opposite be true of the opposite, when the operating company does not perform well?
Thank you for your service.
Francesco

Q: I'm looking for monthly retirement income. Please suggest a few of your favorite ETF'S that I could invest in that would provide me with a monthly income stream. I am hoping you can suggest investments that would yield 4% or better. I realize that to provide this kind of return I will have to accept some level of risk and I'm prepared to do this. However, I hope you can suggest some investments that are relatively safe. If you know of any other possibilities I would appreciate any guidance you can give to me.
As always, I appreciate any advice you can give to me.


I thank you for your guidance.

Q: On the fixed income side I’ve focused on laddered GICs and increasing my exposure to prefs, lately tending to pair resets with perpetuals, as they seem to trade somewhat opposite to each other. I’ve stayed away from bonds only because I don’t want to pay above par only to take a capital loss at maturity. While one does receive a higher coupon to offset the higher price paid, taxes on the coupon are far higher than taxes saved on the capital loss. Unless I’m missing something, I can’t understand paying $103-4 to only get $100 back at maturity, and pay a higher tax rate on its higher coupon, only to receive a lower tax rate for the capital loss. Are people pulled in by the high coupon rate, not realizing that their net bottom line won’t be as attractive as the coupon rate paid?

As a retail investor, I find it difficult to find bonds at the par issue rate. Which leads me to my question, that being on Israel bonds. They seem to be issued at par, and on a 10-year basis, and pay 3.4% (with a 25k min). As part of a fixed income mix, do you see them as a good portfolio addition?

Also, if I’m missing something in the scenario I stated in reference to buying individual bonds in the secondary market, please let me know….maybe I’m wrong, maybe there’s something huge I’m missing and I should be doing it.

Thank you for all your help…

Q: Good Morning Gentlemen,

I am writing to you to get your counsel in developing a long term diversified portfolio in US$.

My Canadian portfolio is based on the 5i 3 platforms.

My objective is to outperform the SPY if possible.
I have chosen 5 ETF’s that when analyzing them seemed to show good performance, good Morningstar rating, and non duplicated holdings.

I have researched their MER’s, objectives etc.

My question to you, (I obviously am not a PM, but Peter is) is by purchasing these etfs:
1)am I duplicating effort?
2)Am I diversifying sufficiently or too much?
3)Would you recommend I add or delete any suggested holding?
5)I have no specific sector ETF, as I can’t predict which one will outperform, is that ok?

Here they are:
Dividend: SDOG (unique approach)
Large Cap: PRF
Small Cap :IJK
Low Volatility: SPLV
Growth: IWY.
Thanks so much in advance for your advice/suggestions.

Sheldon

Q: My question is about selling puts on bns as an example. Any advice on how to start out as I am new with options. Have done quite a bit of reading on the subject. I have my account with TD set up for options 2y ago. What would you recommend as a strike price and how far out would you go. I was thinking about 3 to 6 weeks. What sectors would you currently recommend for selling puts. Any reading you might suggest. What are the taxes paid on the premium received. Thanks for the great service and the more elaborate the answer the better. This is a large question please charge 5 credits. Thank you. Chris

Q: My current holdings are as follows: T-6% of portfolio, Tck.b-0.51%, Rei.un-1.26%, Dgs-2.92%, Bns-11.6%, su-3.38%, dir.un-0.65%, cu-1.82%, Pjc.a-0.99%, cpx-1.89%, pot-2.23%, Igm-3.55%, mic-6.06%, hr.un-0.96%, Cwb-6.93%, Ftt-1.8%, Esi-1.03%, Mkp-1.25%, psi-0.93%, Rus-0.77%, Rc-0.61%, Cnr-3.82%, NA-6%, Bce-5.73%, td-5.43%, Trp-5%, Sjr.b-7.41%, t:nyse-1.83%, Ko:nyse-4.38%, Gsk:nyse-2.09%, Csco:nyse-1.19%

I would like your opinion on what stocks weighting I should add to balance my portfolio. I ha

Q: I have this hedged ETF, VXC, for foreign exposure. If I expect the Canadian dollar to trend up over the next few years which ETF should I buy instead? I'm aiming for 15% of my portfolio to be foreign. Sound like a good idea?

Thanks.

Q: how risky . have stayed in their hotels, very efficent

Q: Hello Peter,
What would be the downside of going overweight on this stock at today's price? As I argue it, the probability of realising value of $21 or higher would be very high, even if the deal to take it private at that price or higher does not happen. What risks do you see at this price?
Regards

Q: Can you comment on the valuation of Sylogist? EV/EBITDA, P/E and P/S and how does it look relative to peers when you take out the cash? I'm wanting a small tech stock with growth potential but I don't want to pay a huge premium in this kind of market. Thank you.

Q: GlobeInvestorGOLD rates these two as a Strong Buy based on a tally of 7 to 10 brokers recommendations. I don't put a lot of weigh on this but both seem to generate a lot of cash and can do no wrong. Would you recommend one or both at this time? This can be 2 questions if you like.

Q: What is the Q4 consensus for sales and eps fd?

Thanks

Q: Hello Peter & team, Any reason for the 4% decline?
Thank you!

Q: According to TD the P/E on SNC is 4.1, WSP is at 22 and STN at 19.1, what do you think of SNC at this time?

Q: On Jan 27th, Pierre asked about buying ZJG. You suggested XGD holding larger companies primarily for safety. I am thinking of adding gold exposure and see that both ETFS have the same MER (.55%)and while XGD has a 70% exposure in N.A. ZJG is 100%.
My question is, would the smaller gold producers in ZJG have more torque to the price of gold and perhaps benefit from M&A activity? Or perhaps not.
Thanks for your great service Gord.

Q: Has the Toronto Star printing opportunity changed your less than positive outlook for this company ? I have never followed the company's progress but am now trying to decide whether or not to buy some shares. It does look attractive to me but I may be missing something.
Thanks in advance .

Q: Hello,

What are your thoughts on XEG? Would buying shares of XEG.TO be a good strategy for getting exposure to an oil price recovery without the risk of holding individual oil companies?

Thanks

Q: CIG was downgraded today by RBC and the stock is being hit. Time to sell? Your thoughts please?

Q: Peter and His Wonder Team
I realize aluminum is in the "doghouse"...oversupply and underdemand. However I have read a few analysts who think the balance may tip within 6-12 months. So I am looking for a longterm contrarian play. Are there any Canadian companies that might qualify...they must have a decent balance sheet with low debt, good management, safe jurisdiction. A junior company usually has more upside. Your thoughts would be appreciated. Does such companies exist or am I dreaming?
Respectfully...Dr.Ernest Rivait

Q: Low yielding companies such as Ccl, Csu, Sj that outperformed the Tse in 2015 are down over 10% so far in 2016.
High yielding companies ie Ala, PPl,Trp that underperformed last year are up over 5-7% ;
Do you expect this trend to continue?