A Comment -- General Comments From an Expert (A Commentary)

ETFs for dividend and some growth. Demand has been through the roof this year. Dozens of dividend ETFs in Canada, with differing sector exposures and strategies. If you want dividend growth, then you'll want to tilt more toward the cyclical areas of the economy than the defensives. Try XDV or CDZ, the bellwether dividend ETFs in Canada.

Safe and secure corporate bond ETF with high rate of return. Huge product category covering every slice of the spectrum from quality to junk. In a rising rate environment, you might want to stick to a shorter term. XSH and ZCS are short-term, corporate, investment-grade ETFs. Had drawdowns, but not as bad as a typical aggregate bond or high-yield ETF. Another option is to just go to cash in a high-interest savings account.

A note on ETF recommendations. He and his team do ETF research, which is applied to model portfolios. They don't manage funds directly.

Bond fund for a non-registered account. Generally speaking, bonds are the first thing you'd put in a registered account, as bond income is taxed at the highest levels. That said, there are products with their own set of risks. One is HBB, which delivers the bond index return in a total return format, so you're not receiving income. Horizons has a whole class of these products that an investor can research.

Buy US index funds monthly? Good practice, behaviourally, to be adding to your investments every month. Even if you're young and can't contribute that much yet. Which index funds to add is a big question. In general, go with the pure passive big heavyweight products that have low fees from iShares and Vanguard and State Street. Those names are a good place to start your research using third-party websites like ETF.com. For Canadians, look at offerings from home-grown names like Invesco, BMO, iShares, Horizons. Using the Canadian-listed ETFs makes particular sense for high net worth investors who want to avoid US inheritance taxes.

Ethical EM funds. ESG is growing enormously. Take a look at FRDM. Tracks the Freedom Index, which looks at countries for freedom of the press, elections, democratic governments. Totally excludes China and Russia. India and Turkey find themselves sometimes included, sometimes not. There are actively managed global ETFs as well, look to their websites for criteria they follow.

Method for picking stocks. His firm has a disciplined, rigorous, and consistent approach to investing. Bottom-up investors. Start with the 4,000 investible companies that trade on the TSX. Look for market cap greater than $200M, actively traded and liquid, track record of over 5 years so they can see how companies do over the course of a business cycle. This leads to "research candidates" of 400 companies. Quality filter is applied, which further reduces the field to 120 companies, the "working list". All on the working list have strong balance sheets, good profitability, high return on equity and invested capital, impressive operating margins. When it's time to buy, they apply a valuation filter to the working list. Companies are ranked by quality and valuation. The winner is researched, with results distributed to the investment and management committees. If everyone is happy, the name is added to the portfolio. As long as a company is profitable, they're agnostic as to what industry it's in.

REITs for the next year. REITs don't really match with how his firm looks at the world, so he wouldn't be putting money into them. They're looking for companies with not a lot of debt, yet able to get high profitability with high ROEs and ROCs. REITs in Canada tend to generate ROEs considerably below stock market average, yet their amount of debt is quite high. They own a limited portfolio of 20-25 names, and they don't need to be in REITs.

Metrics for evaluating banks. Fundamentals such as strong balance sheet, tier 1 and core capital ratios compared to the industry and peers, ROE, various profitability metrics. Ability to pay the dividend consistently and to increase the dividend and return capital to shareholders.

Gold. Price of gold is caught in the middle but, overall, he'd be slightly bearish. Not working as well as an inflationary hedge as it has in the past, partly because the Fed's aggressiveness is really increasing the USD, so people are moving towards it instead of gold.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Investor Mistakes: Too Much Emphasis on Stories. In the past two years, there’s been tons of media exposure on a few companies and sectors, such as GameStop Corp., AMC Entertainment Holdings Inc., the electric-vehicle industry, the cryptocurrency sector and special purpose acquisition companies (SPACs). The media loves these sectors, they generate investor interest and trading, and result in a lot of FOMO amongst investors. But, really, are they that important? GameStop is a US$10-billion company in a declining industry. AMC is US$8 billion. They hardly matter at all in the big picture of the investment world. But together they account for more news stories than most large companies can ever hope to achieve. We ran GameStop through Google and got 143 million hits. We also ran AbbVie Inc., a US$270-billion company (27 times as large as GameStop) and got only 32 million hits. Investors need to put far more emphasis on the larger, important companies rather than the tiny companies that generate exciting headlines.

A Canadian real estate fund has just halted payments Starlight had been growing a mismatch

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