Investment Q&A

Q: Hi,

Here are my current sector allocations with target sector allocation in brackets and holdings. For a growth focused long term investor, does this make sense to you? We have around 45 holdings with a few ETF's (VEE, XEF) for international exposure and 100% equities.

I've noticed in your growth portfolio, your main sectors are financials, industrials, tech and cons. disc, with the other sectors at relatively low weights and I've tried to match our allocation with that. For an individual DIY investor, how often should one be looking at their sector allocation and rotating sectors? For example, looking at economic contraction and expansion cycles, are there certain times when we should be over or underweight sectors?

Currently, what part of the cycle are we in and with the FED indicating rate cutes in 2024, should I be trimming and adding in certain sectors? I find it too hard to perfectly time sector outperformance so ideally I just want to buy great businesses that will perform well throughout any cycle and I feel that the companies that I own will do very well over time. Do you agree? I'm not looking to make dramatic shifts in sector allocation, but maybe some small adjustments. For example, trim some tech and add to materials/energy. However, when I think about trimming quality companies like CSU/LMN/SHOP, etc.. and adding to more energy/materials, sectors that are highly cyclical and not in control of their own destiny (dependent on commodity prices), I get hesitant. Can I get your general thoughts on sector allocation and sector rebalancing. Thank you!


Technology 24.47% (22) SHOP, KXS, CSU, NVEI, CRWD, TOI, NVDA, LMN, INTU
Financials 22.61% (18) SLF, V, MA, JPM, GSY, TD, TSU, BN
Consumer cyclical 16.02% (18) ATZ, MGA, BYD, SBUX, BKNG, CROX, DOO
Industrials 14.13% (20) WSP, ATS, TFII, GDI, HPS.A, HEI, CPRT, AXON, TVK
Consumer staples 6.34% (5) PBH, COST, DOL, ATD
Energy 4.90% (5) TOU, WCP, TVE, ENB
Communications 4.16% (5) GOOGL
Cash 2.10% (2)
Health care 1.91% (5) WELL
Materials 0.71% (5) LUN
Utilities 0.37% (0) BEP

Q: Good morning, Over a one year short period of time, which of these two companies do you think has more potential, Docebo or Shopify, thanks? Disregarding the risk level.

Q: Small caps have lagged the market. What are your top 5 Small Cap Canadian Names and top 5 US Small Cap names? Could you also indicate good entry points. Please deduct appropriate credits.

Thanks
Tim

Q: Do you have an update on your opinion of this company since the last answer I can find from last April? Thanks.

Q: In a recent question, you were asked whether you would swap QIPT for WELL. You laid out all the reasons why you much prefer WELL over QIPT but then concluded by stating that you would NOT swap. I think what you meant to say was that you would swap.

Q: BCE is approaching its low price point over many years. Is BCE undervalued, or in trouble?

Q: Hi,

I want to add to BN and BAM. Would you be comfortable buying up to a full position right now, or would you do it incrementally. I am worried that If I wait, the price will just go up as interest may start to come down.

Q: This is in regard to Patricia's Q of Dec. 14, about selling a stock with a capital gain and buying it back the same day. I'd like to relate my recent experience.

I owned 1000 shares of BTE (ACB $2.26) and a week ago I sold them all (for $4.57) to crystalize the capital gain. Later that same day I bought back 1000 BTE at $4.45.

On Friday I noticed, in "My Holdings Details", that the ACB for my new shares was listed as $3.36! As it happened, the ACB of the sold shares had been averaged with the cost of the new shares, giving me an ACB of $3.36 for 2000 shares.

Effectively, my old shares were sold for a much smaller gain, and the new shares, which should actually have a slight loss right now, show a gain of ~$1000.

So now I'm trying to sort this out with Investorline, and am waiting to hear back.

Next time I will wait a day or two between such transactions, in order to avoid this trouble.

Q: As interest rates potentially get cut at some point in 2024, What sectors do you like heading into 2024/2025 and what sectors do you dislike?

Thanks
Tim

Q: Could I get your opinion on Pine Crest Energy including reserve life ,dividend sustainability, management, the oil price needed to keep in business, and the possibility of a potential takeover. As always ,thanks for your answers.

Q: Hi 5i!

What do you toughts about Herseys at these levels?

I'd like also to have your toughts about Fubo.

Many thanks!

Frank

Q: As the FED has signaled up to 3 rate cuts in 2024 do you recommend having 5% exposure to gold stocks? If so, would companies KGC, GOLD, or OR be ones to add to a portfolio? Thanks!

Q: Hi Group can you give me your thoughts on 2 Financial + 2 healthcare
stocks. The above picks are just shots in the dark are there others you like better or? also short explanation with you suggestions would be helpful

Q: A family member of mine is looking at investing some money that will serve as a retirement fund/as a hedge against inflation. She is also investing some money in GICs as the rates are presently good, while simulatously serving as an insurance policy should markets take a dive at some point. She is approaching 60 years of age and will be retiring within the next 12 months. She has no interest in investments and we believe that ETFs are the answer. This individual is conservative and wants to minimize risk, while definitely wanting to beat the guaranteed interest rate we get of approximately 5%.

One family member suggested the following ETFs (mostly due to the low cost of fees I believe)

VOO, VEQT, QQQ and S&P500 (which I don't know, supposedly has .05% fee)
(and suggested that 20% goes into QQQ)

Looking at your recommendations for ETF's from the questions asked, I have seen XIC, SPY, CDZ, XIC, CDZ, XGRO, QQQ, VGRO, VIG, ZSP, (to name a few).

I think there are more ETF's than there individual stocks. It would be great to have some coverage across Canada and the US.

We have a few questions:
1. Do you think the list provided by the family member is acceptable?
2. Could you provide your recommendation of ETF's (with a short description of the ETF) that fits the risk level of the mentioned individual (while simultanously providing a little risk). What % of each ETF would you recommend (i.e. buy equal amounts of each of the recommended ETFs or ...).
3. Do you believe that it is the right time to buy ETFs. With the recent run up, is it preferable to wait for a pullback and buy on dips or acquire all today or .....

Please deduct as many questions as deemed necessary.

Thanks.

Q: Peter; I just saw this Friday PM- do you have any concerns about this ? Thanks.
Rod TorQuest typically invests in mid-sized companies, seeking to revamp them with changes to governance, strategy and operations, and building them up with injections of capital and acquisitions. Its current investments include Canadian fast food chain A&W Food Services of Canada Inc. and Calgary-based information technology staffing company S.i. Systems.

Q: Greetings:
It has been considerable time since a question has been asked about Timbercreek Financial, formerly Timbercreek Mortgage Investment Corporation. Interest rate now almost 10%-- Was higher in Oct, 23 when price fell badly. I have owned it for years. Apparently they are finishing settling a big bad loan- I have no idea how much they lost and would like to know. Could you please provide as much info about this MIC as possible. Would you buy more or sell? I believe it is back on the road to recovery, or would you buy something like Atrium. or sell both.

Thanks very much for your speedy replies. Wonderful.
Ben.

Q: I was interested in your reply to Ronnie today (14th) on U.S. growth suggestions. As individual securities you suggested IBKR, LPLA, CELH, CROX, DUOL. If I was to add HEI, ADI and ULTA to that list could you rank all 8 for say 5 yr pure growth potential and then re-rank if one was seeking a balance of both growth and safety? Thank you.

Q: Hey guys, thanks for all the great advice.
Would you have any insight to why BCE is struggling while markets seem to be bolstering with prospects of interest rate reductions next year? Paying a 7.0% dividend and last quarter report seemed positive, any detractors you are aware of beyond CRTC ruling on opening its fibre network while exempting BC?
Merry Xmas to all, Ted!

Q: I realize you are not tax experts but I am confused from info obtained from bank and CRA web sites. I am 69 and wife is 59. I would like to split income from RRSP (not RRIF) with her when I withdraw some funds this year to pay for house repairs. Some sites indicate that RRSP withdrawals do not count as pension income. Does this mean that I can’t split it with her? CRA seems to say that RRSP (T4RSP) is eligible. Confusing!

Thoughts from you and members would be helpful.

Q: Dear 5i Team,

As the holiday season approaches, I wanted to take a moment to express my sincere gratitude for the outstanding service your team has consistently provided. Your expertise and dedication have been invaluable.

Considering the current financial climate where interest rates seem to be stabilizing or decreasing, I'm contemplating whether it's an opportune time to invest in split shares mostly for dividends for 1 to 3 years hold. Do you see any issues? if not would you recommend top 2 split shares in Canada.