Portfolio for my Father, Please Help

[Dopplegangerr]

I am trying to help my father pick out a diverse portfolio that he can put a portion of his money into. He is unhappy with his mutual funds and would like to transfer over 30k now with the potential for investing an additional 50k that will come from other sources later in the year.
My idea is to select companies that my Dad knows and can understand, I am not interested in putting in tech stocks or complicated bio-med companies. Brands he knows and loves and have been that way for a very long time is the idea, like having lunch at MCD with a large KO, then go for a walk around CTC with a THI in his hand looking at DE, I think that is a perfect day for him

Some additional information:
He is mid 50s with a solid chunk of his investment into his primary residence.
This money is already in RRSP and will stay registered.
He has no consumer debt.
He will have a pension with 35 years in in the next 10 years from the post office.

I would like to hear peoples opinion about this portfolio as well as what they believe are good buying points. We have the time to do this wright so can wait for certain securities.
Please let me know if there are any dogs in the bunch you would stay away from.

Oil & Gas: SU
Banks: RY
Rail Road: CNR
Gold: G
Health Care: JNJ
Agriculture: DE, POT
Consumer Goods: KO
Services: CTC
Food: THI, MCD
Telecommunication: RCI.B

[HaroldCrump]

How does he feel about monitoring/managing his investments?

I am thinking divide into two ETFs - XIU and XSP.
Between them, they cover a vast amount of exposure to multiple sectors, regions, economies, currencies, etc.
All the tickers you listed above are part of either XIU or XSP.

Most importantly - it eliminates the individual company risk that a concentrated portfolio carries.
For someone like your dad, diversification is perhaps best since individual company risk will be high in a portfolio comprising ~ 10 stocks.

[VJ99]

Given your investment objective and the amount, I'd suggest buying a couple ETFs.
You get the quality companies you want, easy diversification and lower trading costs.
Plus, with the right ETF, you can hedge your USD currency risk.

Here are a couple ETFs to consider:

BMO DJIA ETF Hedged to C$ ETF (ZDJ/TSX)
read more here: http://www.archeretf.com/dow-jones-hi-or-lo/

iShares Cdn Dividend ETF (CDZ/TSX)
read more here: http://www.archeretf.com/miserly-bon...ous-dividends/

[Four Pillars]

Why do you want 100% equities? Can he handle the volatility?

[HaroldCrump]

Why do you want 100% equities?

His dad has a DBP pension. That is the fixed income component of his "portfolio".
100% equities is the way to go for him, IMHO.
Other than some % cash of course, to take advantage of buying low every now and then.

[MoneyGal]

There are two ways I've seen this argued (and FWIW I've always pretty much sided with Harold): he has DB pension income to provide the "bond-like" component of his retirement income stream - so might as well load up on equities with the rest of his investable wealth.

However, there is another line of thought which goes like, "don't take risk you don't need to take."

NOTE: his pension income might be small, at risk, or inadequate to his overall needs. But from the very basic details provided it sounds like he has an OK risk capacity (risk tolerance aside).

[Dopplegangerr]

I liked the way others had talked before about taking the best from a group of companies and leaving the rest. I know Humble has talked about it a number of times.
Also with some of the ETF's mentioned there is no dividend, and dividend investing makes the most sense out of anything to me.

I agree with Harold and MoneyGal about the pension being bond like, and going 100% equities. He will of course have cash on hand.

Does everyone think ETF's are that great?

[Toronto.gal]

I agree with Harold and M.gal [as usual].

I just want to add that it's great to have father/son cooperating this way!

[Dopplegangerr]

Sorry, when looking up these codes on Google finance it shows no dividend. Adding them it to a new watch-list shows the dividend now.. I apologize

[MoneyGal]

Meh. For $30K, ETFs make more sense (in my opinion) than trading 10 stocks -- but there are a bunch of other variables to consider, mainly his overall trading plan, and his level of comfort with managing a portfolio with 10 moving parts.