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

When a bond matures, what value is returned to the holder? Original par value? That is correct. At maturity you get 2 payments. The principal value plus the final interest payment. If you paid a premium, you would have got an income stream that was higher than you would have received with a par bond.

Risks of inflation linked bonds? Would you buy for a balanced portfolio? Yes, he would bite on for a balanced portfolio but right now is not recommending them. They are long-term, long-duration with considerable price risk.

Ontario credit rating? Structural deficit of $15 billion-$17 billion with a likely yearly deficit until 2016 or beyond. With its $250 billion estimated debt what are the chances of a downgrade? Chances are reasonable that there will be a downgrade but not in the near term.

GE Capital Canada 5.1% due June 1/16. 4.6% yield to maturity. Should I sell? This is a strong AA credit globally and has survived the worst of the worst.

Commodity cycle. Thanks this is busted for the moment. One of the key differences we are going to see this cycle versus 2007-2008 is that demand from the BRIC (Brazil, Russia, India and China) will be less. Doesn't think that China has the ability to continue stimulating their economy, particularly in their real estate sector. Demand for commodities from them may decline this time.

Gold. Bad news in Europe and bad news in the US. This is all good news for gold. Look at the 10 year chart, keep your eye on the rising tide and ignore the bobbing cork.

Copper. Bad news out of China, bad news continuing out of Europe, horrible news out of the US so demand for copper is diminishing. However, copper supplies are also diminishing. No matter what the news is, we'll always be replacing wiring, plumbing etc. Neutral on copper but is not bullish on base metals at this time.

Need to be disciplined, and purge emotion. Set asset allocation at a time that is as neutral emotionally as possible. Review on an ongoing basis. Stick to your asset mix, and within those asset classes take advantage of the companies that you think will do well over time, and don't let the macro issues effect your decisions.

Question: how to buy US equities from a Canadian account? Avoid constant exchange, every transaction is a hit on the exchange. Setup a US account, transfer money in and out of US account less often to avoid the exchange hit. If you are doing it through an RSP (which can't be in a US account), then look into discount brokerages (TD, Scotia) matching the exhange rate if you are buying/selling on same day. Tax implications are capital gains tax, withholding tax on dividends.

Gold. Why would anyone want to own paper currencies? Most people have come around to believing that gold should be a part of their portfolio. His problem is that gold is not a producing asset of creating anything for an investor's portfolio. This should be a place for gold, but it should be very limited.

Videotron 6.875% bonds maturing July 15/21. Represents a nice play on the notion of deflation or continued sluggishness in the global growth picture. Very well-run company. Very liquid.

Markets. Best strategy is to focus on companies with good balance sheets, market leaders, pay dividends and somewhat defensive. Top Picks will be focused on trying to get 8%-10% rate of returns with low risk.

Markets. Income is the philosophy he is following. If you go with companies that can generate and spin off a healthy degree of cash flow that is consistent, you have an advantage. He is heavier in the large-cap tech space and picking away at select opportunities in consumers and more defensive plays like healthcare and large dividend paying stocks.

(A Top Pick Nov 4/10. Up 1.25%.) Canam Group Convertible Bond 6.25% 10/31/2015. Infrastructure has done poorly this year. Balance sheet is fine and their winning contracts.