Utilities are attractive right now

High interest rates boost bond yields—and their appeal with investors. Conversely, those high or rising rates can hurt the appeal of high-yield utilities, and their shares, since utilities are then forced to pay higher interest on their debt. However, with interest rates falling in Canada,… Read More

A top ETF for each of the five sectors

A key rule of our three-part Successful Investor strategy is to spread your money out across most if not all of the five main economic sectors (Manufacturing & Industry; Resources & Commodities; Consumer; Finance; and Utilities).
This has two main benefits: a) It keeps you from… Read More

Buy utilities despite today’s higher rates

Rising interest rates boost bond yields and their appeal with investors. Conversely, rising rates can hurt the appeal of high-yield utilities, and their shares, since those companies must pay higher interest on their debt. Still, top utilities remain financially healthy and continue to expand and… Read More

High-yield ETFs—two buys, one avoid

High interest rates mean dividend-paying stocks must increasingly compete for investor interest with bonds and other fixed-income instruments. However, focusing on sustainable dividends still offers an attractive and growing income stream for investors—as long as you avoid the riskier strategies that some ETF managers use… Read More

Balance holdings across the 5 sectors

We continue to recommend holding a portfolio of stocks diversified across most if not all of the five main economic sectors (Finance, Consumer, Manufacturing, Utilities and Resources). This cuts your risk of heavy losses from over-indulging in a sector that’s about to plunge. You also… Read More

Utilities offer you income and growth

Utilities could suffer more than other sectors as interest rates further rise. That’s because they have a lot of debt, and higher rates make it more expensive to raise money and refinance existing debt. As well, their shares, which typically offer high yields, compete with… Read More

Pass on this ETF: BMO COVERED CALL UTILITIES ETF

BMO COVERED CALL UTILITIES ETF $12.37 (Toronto symbol ZWU) invests in Canadian and U.S. utility, pipeline, and telecommunications companies with what it sees as steady revenue streams; it also sells call options to enhance the yield on the portfolio.
The ETF, launched in October 2010, currently holds $1.0… Read More

Canadian sector funds: 1 buy, 1 hold

Last month we recommended some international ETFs—but at the same time, we noted that Canadian investors often have a bias for investing in their home markets. And we agree with that bias—we still recommend that most Canadians hold the bulk of their portfolios in Canadian… Read More