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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: Hello Peter et al.

With all of the latest rhetoric about trade wars between the US and a lot of countries I have lightened my stock portfolio from about 97% to about 75% with the remainder in cash. I have in the last few years worked hard to get the increase in my RRSPs value. I am looking to put the cash into something that provides the following:
1. Quick access if necessary to re-invest again when I feel the time is right.
2. No loss of the capital with what the cash is put into.
3. Maximum rate of return for the above two criteria being met. I know it will not be high.

Is there a Money Market ETF or something similar that meets my three criteria. Because the cash is in my RRSP accounts I can’t take it out without paying tax on it which I do not want to do.


Thanks,

Brendan
Read Answer Asked by Brendan on July 09, 2018
Q: With trade tariffs and uncertainty in the markets what Is the wise move with russel metals, hold or sell? I have a large position so would not be interested in buying more. I hold it in my RRSP for the yield. If you suggest a sell what could replace it considering I also hold BCE, BMO, HR.UN, NVU.UN as well as 4 small caps for growth but no dividends.
Lou
Read Answer Asked by Louise on July 09, 2018
Q: May I please have our view on Cornerstone Metals. Vanadium has been listed by the US government as a strategic metal which is used in steel production and next generation storage batteries. With it being in short supply, the trade war with China and the majority of vanadium reserves in Russia, China and South Africa would this not be a very valuable asset for North America and have significant upside potential?
Read Answer Asked by Fred on July 09, 2018
Q: From Zacks Equity Research:

It commonly happens in stock investing that investors miss the chance of buying winning stocks that they knew would stand out. Before they take the plunge, others get to know the hidden potential and enter into these stocks, pushing them out of reach.

So, instead of repenting, spotting the off-the-radar potential winners and immediately investing in them could be a smart decision.

One such company that looks well positioned for a solid gain, but has been overlooked by investors lately, is Brookfield Renewable Partners L.P. BEP. This Utility - Electric Power stock has actually seen estimates rise over the past month for the current fiscal year by about 57.1%. But that is not yet reflected in its price, as the stock lost 2.2% over the same time frame.
Read Answer Asked by Ronald on July 09, 2018
Q: Further to another users question on BTO, I recognize internal executives will sell their shares for many reasons. However, any additional insight given the insider selling reported by the G&M today?

B2Gold Corp. (BTO-T)

On July 3, William Lytle, Senior Vice-President-Operations, sold 125,937 shares at a price per share of $3.39, leaving 32,052 shares in his account.

Thanks!
Read Answer Asked by Loretta on July 09, 2018
Q: I hold AQN in a cash and Tfsa account. I would like to have the dividend kept in US $ as we often need US $. I presume the dividend would still qualify for the dividend tax credit? I would just have to convert it to Canadian in the cash account. The other account wouldn’t matter if I convert it too? I would have to know the Canadian $ value if I took it out?
Thanks for you insight into this.
John
Read Answer Asked by John on July 09, 2018
Q: Peter and His Wonder Team
Another question about this company if you please. It is about trading volumes. The other day BBOX in a filing to the SEC stated that they might run out of cash by the end of the year and have to file for bankruptcy. The stock crashed from $1.95 to $0.75 in a few hours. Then 2 days later they announce a great giant contract and the stock recovered closing at $2.03 today. The company has 15.1M shares outstanding yet the trading volume today was 61.4M...YES that is right 61.4M. That is 4X more than the entire float. So as a rookie investor I am trying to understand this incredible volume. Is this professional day traders buying and selling ...buying and selling knowing that the price has to continue to rise. Also I notice large orders going through...are these mutual funds buying and selling when they have made a 5-10% profit.
Would you rate this as a very unusual event. Your assessment please! Thank you immensely.
Read Answer Asked by Ernest on July 09, 2018
Q: I am learning a lot from your services of 5i, Canadian Money Saver, ETF newsletter..
I have owned CNR since 2005. From an original 10% of the portfolio, it has now grown to 20%. I read your answers to other questions about CNR.
My dilemma is-
1. CNR is a good long-term hold: So, leave it.
The risk is its falling in a recession/ tariff war. (It fell 30% in 2008.)
2. Portfolio weighting is more important: Trim to a lower percent and pay the tax.
But, from selling other stocks and 5i Growth stocks, I already have some capital gains.
What would you do?
Thank you for your wonderful service and great investor education.
Shan
Read Answer Asked by Shanthi on July 09, 2018
Q: I have a 7% position in MFC. Normally this security would benefit from rising rates. My thoughts on this has changed. Borrowing short term and lending long term doesn’t look that attractive to me at this time as the yield curve is flattering. I’m an income oriented investor are there better opportunities elsewhere.. I’m down about 5%. What are your thoughts on my thesis? Should I sell and move on, reduce my position or hang on? I also have a smal positio in FLI.
Read Answer Asked by Roy on July 09, 2018
Q: This is a followup question for my question from last week about payout ratios.

I understand your reasons for using cash flow over earnings to calculate payour ratios. Thanks for clarifying. But when I use your posted numbers to calculate it for ENB, I get:

Payout ratio = Dividend / cash flow
= Dividend / (Price / Price to cash flow)
=2.684 / (46.69/9.7)
= 56%

But, in the question I asked previously, you stated 37% was the payou ratio for ENB. It was correct for BCE, however (3.02/(54.57/6.5)=36%). I guess I am not calculating it correctly.

How do you calculate your payour ratios based on cash flow?

Also, since it is such an important number that others don’t use (based on cash flow) could you include it in your company profile?

Thanks again,

Fed

Read Answer Asked by Federico on July 09, 2018
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