Investment Q&A

Q: Hi 5i Team,

I'm trying to clean up my US Portfolio so that I'm at 20-25 equities total. Please advise which 20-25 companies you would keep for a 5-10+ hold with balance/diversification but also some growth in mind.

Q: I have held Visa for many years and made some good capital gains. But the rules have been changing and companies allowing customers to pay by credit card are now allowed to charge those customers an extra 2-3% fee if they want to pay by credit card, in order to offset the fees charged to them by V and MA. Increasingly I am seeing restaurants, retailers and others tell me they will add 2-3% to my bill if I want to pay by credit card. I am seeing this more and more often when I make a purchase and it is causing me to prefer cash to credit, especially when the dollar amount of the purchase is quite substantial and the extra fee, accordingly, is also substantial. Even when the businesses I am dealing with are not charging me this extra amount, I am more inclined than I used to be to pay by cash if the retailer is a small business, just to help them reduce costs.

So my question is how much should I worry that this effect will snowball gradually over the next few years, with a negative effect on V and MA? Both stocks seemed to have plateaued recently. Is it time to replace my V with another stock and if so, what would you recommend as a suitable replacement?

Q: Where can I find any information or the best write up you've seen on Mastercard or VISA's "value added services". Stuff outside of their payment network everyone knows about.
I basically only ever find information on the payment network and then descriptions of the value add stuff is super short and surface level only.

Q: Hi Peter can you provide opinion on TDV etf. What are your thoughts of it price and quality?

Q: Your thoughts please about the merger with Discover and their competitiveness versus the dominance of Mastercard and Visa

Q: The dividend announcement seems to be well received. Can you comment on the implications of this if one plans to hold for the next 10+ years? Are there companies that you can use to parallel the potential future returns? Is Apple, Visa or MasterCard good proxy? Meta is likely to be aggressive in dividend increases.

Q: Hi 5i, I currently hold JPM in a registered account and I'm looking for more growth in the next 5 to 10 years. Which of the three listed has the best growth profile and is shareholder friendly. I want to stay in the financial sector and if you have a better idea, an idea listed as a CDR, please suggest. Thx.

Q: Could you please give me the top 10 stocks with the highest ROCE 5 year average (Return on Capital Employed) on the TSX and the S&P? So, that would be 20 stocks in total. Thank you very much.

Q: JPM has had a decent run but I'm thinking of swapping it for Mastercard. Can I get your thoughts please?

Palo Alto has also been terrific, but I'm trying to add more AI into my portfolio. I'd like to sell it and find a new name, CDN or US. I own MSFT, AAPL, Salesforce, GOOG, Meta, NVDA, Constellation, Shopify and Kinaxis. I was thinking of Taiwan Semi, AMD or Broadcom, but can I get your thoughts please?

Q: Hi,

These are some names that I hold that are smaller weights in my portfolio (<2%) and I would like to add to my positions. From comments, I think all of them are solid going forward and some have run hard, such as HPS.A, TVK, CRWD...The thing I've struggled with before is adding to names at the wrong time after they've had a good run and then the market turns and your gains turn into losses. How do you approach these situations and when do you decide to add to a starter position.

Would you be comfortable adding to any of these names at the current prices and can you rank which ones you would add to first?

With the market at record levels, I'm a bit more gun shy of doing so but I think on any market pullback, I would add to any of these names. Would you agree?

I remember a question you answered recently about increasing the avg. cost base vs the % of the position when adding. So for example, I bought HPS.A at $50 and now its $93 for a nice gain, however it's only 1.5% of my portfolio now. So if you are comfortable with a 3% position, do I just add now to get to that 3% even with the run that its had? Or wait for a nice pullback, which of course is impossible to predict. I try not to anchor prices and of course the buyers today are forward looking and expect good things to continue. How do you approach this? Thanks!

Q: Hi ,
Can you please identify me with 3 US stocks and 3 canadian who have a monopoly over their business. ?
I already own CN . I hope it’s one of it?
Thanks. Alnoor

Q: Hi 5i; I would like your assessment of Fiserv Inc. (FI). It has started to trend up off the lows of 2022 and I am back into positive territory but not certain this is still one to hold. I am interested in the outlook for this stock individually and whether you see it in the top quartile performer in a crowded and competitive space – electronic payments.

I’d also appreciate your comment on the Goodwill number on Sept 30th balance sheet; seems excessive?

Thanks very much.

Q: Master or Visa ?

Q: Hello, it would seem that AXP has experienced a pullback and looks undervalued compared to its peers. Would you consider AXP a buy over MA and/or V ?

Q: I have a sizable capital loss for 2023 right now. I'm starting to think of selling some of my winners in my non-reg accounts to wipe that cap loss out this year. Three of the companies where I have capital gains are Hubspot, Mastercard, and The Trade Desk. What strategy would you recommend for me in selling some or all of these 3 positions to erase the capital loss. MA has been a longterm winner for me, but I worry about Fintech competitors eating into their business. I'd appreciate your insights on whether Hubspot has a rosy future or whether its best times are behind it. The Trade Desk is my most confident position, but, of course, I'd appreciate your opinion. Thanks!

Q: For a RESP rebuild with 5 years till 4 annual withdrawals start, to achieve a higher total return with lower volatility, do you think the above stocks will reach the intended goal. Thank you so much

Q: Do you think Mastercard has the potential to outperform the market over the next three to five years? The company has had to cut the fee it charges retailers in various countries, it is facing lawsuits regarding its high fees, and it has more competition now. Do you think the cash-to-card runway opportunity outweighs the risk of a drop in revenue due to lower fees? Also, in the US, where merchants may be allowed to choose another payment network even if the customer pays via a Mastercard, do you think Mastercard has an advantage with its value-added services?

Q: Hi Peter,

Hopefully it won't time out (if that's the problem)....I saved the question and I just did a copy and paste.

Hi Peter,
I asked if you got my question sent on May 11 and 5i responded saying you didn't get it an to re-send it....here it is:

Regarding Timour's question on CBDC's posted the 11th May, I get the impression the response seems "positive" on CBDC's. I was a bit surprised that their was no mention of how this would affect each and everyone of us with the retail CBDC's. The idea is to get rid of cash completely, which would give central banks absolute control of the money of each individual, not me saying that, here's a 57 sec. video from the top guy of the BIS (a must watch):

https://www.youtube.com/watch?v=a9IimgEyjy4&ab_channel=ForbesBreakingNews

If an individual can ONLY open an account at the central bank of his/her country, then we would be at the mercy of the rules and regulations of that central bank and no other bank to go to because there won't be any. Wouldn't that be a complete monopoly? This is a very serious matter that everyone should know about....nothing like this has ever been done.

Please check these links....they are opinions of very knowledgeable people:

https://www.cato.org/study/risks-of-cbdcs

https://off-guardian.org/2023/03/07/central-bank-digital-currency-is-the-endgame-part-1/

https://childrenshealthdefense.org/defender/central-bank-digital-currencies-what-they-are/

https://www.forbes.com/sites/norbertmichel/2023/03/06/cbdcs-not-just-a-different-form-of-money/?sh=241c275a21b6

In this link please listen to at least the 2nd. 2:50 min. video:

https://home.solari.com/blast-from-the-past-week-of-april-17-2023-prof-richard-werner-the-case-for-abundance/

https://childrenshealthdefense.org/defender/central-bank-digital-currencies-cbdcs-cola/

I know there's a lot of links, but please have a look at them....no rush :)

Would really appreciate your comments,

Thank you!

Q: Hi there,

I'd like to own 8 companies listed in the USA (but not necessarily USA based companies). The holding period can be 5 - 10 years or more as I am many years from retirement. I would like to focus on companies that have a moat and pricing power and strong earnings growth now and anticipated future earnings growth.

I am leaning towards an oil company, an insurance company, a resource company, a semi conductor or 'tech' stock, and the financial services industry. I want to avoid stocks de jour as I got badly burned this year in things like upstart, apps, and unity, although I understand that upstart may benefit from AI and I am open to considering that one as well.


I am considering: Abbv, Lnth, Sanofi, ISRG, Visa, Fisv, Nvda, STmicroelectronics NV, Sea Limited, Meli, and Anet, Mckesson Corp, Oxy or COP, among others.

I am not asking for a full report on any of the names above, just trying to throw a few names out that I was looking at. I am also open to etfs.

What would be your top 8 picks (not necessarily the ones I've mentioned)? I am okay with risk. Thank you,

Jason

Q: I have asked questions about core portfolio and compounders. I would like to refine my query to building a concentrated core portfolio [say, 20 CAD-USD total]. I start with the allocations greater than 5% in the 3 portfolios. BN is less than 5% on its own, yet, I wonder whether it would not be the core Canadian financial stock. As for US, there are many Fav lists, but could you boil it down to 10. For each stock, please provide key rationale for choosing it and a target buy price.
Much appreciated,