# I see nothing worth investing in



## celishave (May 8, 2010)

For about the last six months I have been slowing my stock purchases as I see fewer and fewer deals out there. There have been a few pullbacks that didn't materialize into anything after things looked scary for a few days. I was hoping for a meaningful correction so that I could deploy my cash. 

Bonds are out of the question as they will drop in value as rates rise.

Real estate is incredibly over-priced.

I keep accumulating cash and have about 5 years expenses at the moment and am getting more and more frustrated. I feel like investing heavily into the market now is not the right move but I am losing $ with my cash sitting there doing nothing.


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## mogul777 (Jun 2, 2009)

celishave said:


> I feel like investing heavily into the market now is not the right move but I am losing $ with my cash sitting there doing nothing.


So are you planning to invest based on emotion? Does that sound like a wise move to you? And "losing $" is relatively speaking... you may lose more, less, the same. And technically all you are losing is inflation which is squat right now anyway.


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## Jungle (Feb 17, 2010)

That's why I am just going to pay the mortgage off for now. We didn't get the best rate a couple years ago but the extra payments make a huge difference.


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## Dr_V (Oct 27, 2009)

celishave said:


> For about the last six months I have been slowing my stock purchases as I see fewer and fewer deals out there. There have been a few pullbacks that didn't materialize into anything after things looked scary for a few days. I was hoping for a meaningful correction so that I could deploy my cash.


I'm in roughly the same boat. My purchases are few and far between. In the past six months, I've made one acquisition (Uni-Select, UNS). I've had my eye on Precision Drilling Trust, which was really tempting me when it was hovering around $6 a few days ago, but it has since rebounded to over $7.50.



K.


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## brad (May 22, 2009)

Companies that manufacture equipment to prevent offshore oil spills would probably be a good investment right now; they'll probably be really busy for the next decade.


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## Bullseye (Apr 5, 2009)

Really? I think you need to look harder! I expected to stall my buying by this point of the cycle, but am still finding some great deals.


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## Dr_V (Oct 27, 2009)

Bullseye said:


> Really? I think you need to look harder! I expected to stall my buying by this point of the cycle, but am still finding some great deals.


Care to provide some examples?


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## Dr_V (Oct 27, 2009)

Bullseye said:


> Really? I think you need to look harder! I expected to stall my buying by this point of the cycle, but am still finding some great deals.


haha!


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## Bullseye (Apr 5, 2009)

Dr_V said:


> Care to provide some examples?


How about PGF.UN (Penn Growth)? A solid company, not too far off it's 52 week lows. 

TRP and FTS are still a steal at current prices, imo. Been loading up.

Also on my deal radar - Shaw, CML Healthcare, Yellow Pages, Manulife, Husky. To name just a few!


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## Dr_V (Oct 27, 2009)

Bullseye said:


> How about PGF.UN (Penn Growth)? A solid company, not too far off it's 52 week lows.


I recall looking at PGF.UN not too long ago, but excluded it at the time, though I don't recall why ... I will have to check up on that one again. (I suspect that I had concerns over a cut in the dividend when it converts to a corporation.) It's a good suggestion, though -- thanks.



> TRP and FTS are still a steal at current prices, imo. Been loading up.


TRP has too much debt for my tastes (and is trading at multiples of its book value which are a bit higher than I like). FTS also has too much debt for my tastes.

For reference, here are the main stocks on my deal radar -- they aren't quite at my buy points yet (typically 8 to 20% higher than I want), and they include:

HLF (High Liner)
ALA.UN (AltaGas)
MRD (Melcor Developments)
AQN (Algonquin Power)
Enerplus (ERF.UN)
Marathon (MRO)


K.


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## HaroldCrump (Jun 10, 2009)

celishave said:


> Bonds are out of the question as they will drop in value as rates rise.


I wouldn't write them off as easily, esp. if you don't mind corporate debt.
Unless you want to trade bonds actively, the rise in interest rates is less of a concern if you wanna hold till maturity.
In that case, you have to look at the YTM and the payout risk (rating, reliability of the company, etc.).
Even today, you can get corporate bonds rated BBB+ or higher yielding in the low-to-mid 5% for a 4 to 5 year TTM.


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## Doug Out West (Apr 25, 2010)

Been buying some CS - Credit Suisse
MIR Mirant in the 11s
Premium Brands in the 12s
was in Slate street too early but was 10% from where I was watching it
AG growth
Trican
Foremost

orders in for :
ALA
CLL
VLN
ARE 
S had sold long time ago at 7 would buy again at 6


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## Dr_V (Oct 27, 2009)

Doug Out West said:


> VLN


I'm assuming "Velan". It keeps popping up on my stock screens, and I love manufacturers (since they're generally simple to understand & evaluate), but the issue that I have with Velan is that they've done such a historically poor job of creating value for shareholders.

Their historical RoE fluctuates, but has been only a few % in each of the past 7 years. This suggests either an incompetent or not a shareholder-focused management. I've stayed away as a result.


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## Fisher (Apr 8, 2021)

Same here, every stock looks overpriced, and Covid is still no-where close to be finished. I hate keeping cash. I don't believe the inflation number the government told us, because it is getting harder and harder for me to save a loonie . But stock market is the only place I can possibly make my savings grow to fight back inflation.


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## agent99 (Sep 11, 2013)

Fisher- I don't disagree. but wanted to point out that post #13 was posted in 2010! 

There are some who predict that the tsx will have a resurgence and catch up with the S&P. I hope so, but not buying any new equity - just hope what I already have does well


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## Fisher (Apr 8, 2021)

agent99 said:


> Fisher- I don't disagree. but wanted to point out that post #13 was posted in 2010!
> 
> There are some who predict that the tsx will have a resurgence and catch up with the S&P. I hope so, but not buying any new equity - just hope what I already have does well


LoL , I guess money is always an issue no matter what years we are in. 11years later, money still a problem for us, no escape.


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## james4beach (Nov 15, 2012)

Fisher said:


> Same here, every stock looks overpriced, and Covid is still no-where close to be finished. I hate keeping cash.


I don't think it's a good idea to try predicting markets this way. It's pretty much impossible to predict what the future will bring. Just look at the start of this thread, as a case study. In June 2010, even though people said this looked like a bad time to buy, it was in fact a *great time* to buy.

So much for intuition! Here are the annualized returns starting when this thread began:

TSX Index, 8.0%
S&P 500 index, 15.4%
Bonds (XBB), 3.8%
These are great returns. Everything, including bonds, returned more than cash.

Here's something interesting too. The date this thread was started was such a great time to buy, that stocks didn't ever go negative if you had bought at that point. So much for waiting for lower prices (timing)... just look at this chart of the TSX Composite. Anyone who was certain that lower prices would eventually come, is still waiting 11 years later and never got a lower entry.


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## james4beach (Nov 15, 2012)

Another way to say this is that, for all we know, today might be the _best_ possible time to buy the stock index or bond index.

Wouldn't you agree, this is possible?


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## newfoundlander61 (Feb 6, 2011)

Lumber related stocks have more room to go this summer, many do not pay dividends but have good solid upside potential.


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## Retiredguy (Jul 24, 2013)

james4beach said:


> Another way to say this is that, for all we know, today might be the _best_ possible time to buy the stock index or bond index.
> 
> Wouldn't you agree, this is possible?


Hmm, expect thats what RE agents are saying too and buyers seem to agree.


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## agent99 (Sep 11, 2013)

Fisher said:


> LoL , I guess money is always an issue no matter what years we are in. 11years later, money still a problem for us, no escape.


I haven't checked, but I imagine if those guys had bought almost anything back then, they would be sitting pretty today. Stocks like dollarama or couche tard have returned over 1000% over 10 years.

So basically just buy a good stock and sit on it ! But which one?


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## Jimmy (May 19, 2017)

The easiest way to find buy times is just to add the Relative Strength Indicator ,RSI , to your chart. For ex right now the TSX is a little overvalued. Wait until the RSI falls below 50 , below or close to 40 even better


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## james4beach (Nov 15, 2012)

agent99 said:


> I haven't checked, but I imagine if those guys had bought almost anything back then
> . . .
> So basically just buy a good stock and sit on it ! But which one?


They actually posted at a market bottom, which is kind of funny. And there's no need to agonize over which stock to buy. Just buy the index and be done with it.

If you enjoy picking stocks, go ahead and do that but most people don't succeed in that kind of picking and should buy the index. Even most fund managers can't do better than the index.


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## AltaRed (Jun 8, 2009)

About the only thing I can see happening this year in the equity markets is a minor correction of ~10% or so at one point or another. I think the equity market is looking for an excuse to consolidate but don't know what the trigger really will be. It may, or may not, coincide with (be a result of) another 'surge' in the yield curve (5-10 year bonds) that some money managers/analysts think could occur after mid-year.

I am usually always fully invested due to being in withdrawal phase but have quite a chunk of change sitting in my RRIF (resulting from maturing GICs and bonds) waiting for a correction in VCNS pricing. I am unwinding my GIC/bond ladder and moving to a single holding of VCNS in my RRIF over time. Hopefully will be able to deploy this cash into VCNS by Fall. Rinse and repeat for the next 4 years.

P.S. I am with James. Buy broad based indices and call it it a day.


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## MrMike (Sep 30, 2020)

Not knowing what to buy depends on what you already own. I have $10K in RioCan and want to bring H&R up to that amount too; but if you already have enough money in your REITs, and many other sectors then sure, finding good stocks cheap can be harder. And like everyone else says, broad market ETFs if nothing else. Put that money to work!


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## Eder (Feb 16, 2011)

I don't like to time markets, I prefer to cash my dividends and go back to sleep, but this is crazy. My net worth is thru the roof in spite of trying to spend it...obviously something has to happen. Its pretty hard not to start trimming.
I take solace that many are thinking the same thing so most likely we are all wrong.


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## james4beach (Nov 15, 2012)

You could also do something crazy and reckless like I do, and invest in a portfolio of stocks + bonds + gold.

If you held that portfolio, you'd see that it's pretty easy to add more money today. Stocks are at all time highs, but bonds and gold are not. In fact bonds & gold are both down significantly since last summer.

It means that today, you'd buy bonds and gold (two assets out of favour) and that's exactly what I've been buying recently. Also known as "buy low".


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## agent99 (Sep 11, 2013)

AltaRed said:


> I am usually always fully invested due to being in withdrawal phase but have quite a chunk of change sitting in my RRIF (resulting from maturing GICs and bonds) waiting for a correction in VCNS pricing. I am unwinding my GIC/bond ladder and moving to a single holding of VCNS in my RRIF over time.


I have looked at etfs like VCNS including their newer one VRIF. Going from GIC/Bond ladder to one of these means going from all fixed income with some guaranty to a mix of equities and fixed income with no guaranty. 

I thought VRIF might work for us, but I don't see it having any growth - just a steady cash flow of 4% of unit value. Total return more likely lower than higher.

As the thread subject says - I see nothing worth investing in


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## AltaRed (Jun 8, 2009)

As an aside to the thread's purpose, VRIF is a take on 4% SWR and the Vanguard VRIF Q&A provides insight on how they will operate it. To the extent VRIF has a CAGR exceeding 4% over time, it will have no choice but to have growth both in FMV and payout. VRIF is an excellent fit for certain investors at a certain time.

As to the thread's intent, I would suggest there may not look to be much incremental to invest in at the current time, but there are certainly opportunities to adjust portfolios.....which is what my post #24 is about.


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## agent99 (Sep 11, 2013)

AltaRed said:


> As an aside to the thread's purpose, VRIF is a take on 4% SWR and the Vanguard VRIF Q&A provides insight on how they will operate it. To the extent VRIF has a CAGR exceeding 4% over time, it will have no choice but to have growth both in FMV and payout. VRIF is an excellent fit for certain investors at a certain time.
> 
> As to the thread's intent, I would suggest there may not look to be much incremental to invest in at the current time, but there are certainly opportunities to adjust portfolios.....which is what my post #24 is about.


Regarding VRIF, Couch Potato has a series of posts on this etf. As with many such funds, it will pay out more than it earns (4% vs 2.4%). The difference will require growth of the holdings - mainly the equity, which is of course only a portion of the holdings. If growth is insufficient or even negative, it will pay ROC which will cause the unit prices to drop. Overall maybe collect your 4% and hope that the unit prices don't drop much. Not too exciting if TR is just 4%.!






Search Results for “vrif” | Canadian Couch Potato


Your complete guide to index investing



canadiancouchpotato.com





I put it among the large group that are not worth investing in  It may suit others.


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## AltaRed (Jun 8, 2009)

It may well suit many, e.g. those who simply live off RRIF annual withdrawals that their FA dishes out to them every year. It certainly could be much better than 4% SWR methodology, leaving underlying management of the portfolio to the average investor to mess up. The average investor is likely to do more damage to their own portfolio than if they had just accepted global market returns of an asset allocation ETF.

If VRIF cannot exceed a CAGR of 4% long term, I'd be very surprised. In any event, it is not at all relevant what the yield of the underlying components of VRIF is. The key is 4+% CAGR return on a long term basis. Anything else gets into that ridiculous argument again about just living off dividends.

Added: I would have VRIF as the single holding of my RRIF if I didn't need to be more conservative there, due to being 100% equity in my TFSA and non-reg accounts.


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## agent99 (Sep 11, 2013)

AltaRed said:


> Anything else gets into that ridiculous argument again about just living off dividends.


You don't like that option?  We do!  We don't use our RRIF withdrawals directly for living expenses. We mainly withdraw dividend stocks in-kind plus some cash. This provides growth of taxable accounts, pays our taxes and funds our TFSA contributions  

Our RRIFs are over 60% FI. I would like to increase that number. Just hard to find options, except for preferreds. This is the reason I was looking at funds that have more access to corporate/foreign bonds than we as individuals do. But they do need to offer a yield that will compete with preferreds in amount and reliability.


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## Spudd (Oct 11, 2011)

When I get an inheritance (sometime in the next 5 years, I am guessing), I am strongly considering putting the whole thing in VRIF and just forgetting about it. It seems reasonably tax-efficient, predictable payments, nothing to maintain/rebalance, just overall a pleasant thing to have in a taxable account.


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## AltaRed (Jun 8, 2009)

agent99 said:


> You don't like that option?  We do!  We don't use our RRIF withdrawals directly for living expenses. We mainly withdraw dividend stocks in-kind plus some cash. This provides growth of taxable accounts, pays our taxes and funds our TFSA contributions


It isn't about not liking that option. Since the vast majority of investors must draw on invested capital, e.g. the full amount of their RRIF withdrawals plus CPP and OAS, we sometimes owe it to readers of this forum to address a broader perspective. This forum shouldn't regularly be all about me....me....me, although it seems the majority of posts trend that way.

The premise of this thread is about personal perspectives on there supposedly being nothing to invest in. I disagree in that in accumulation phase, it is always best to be fully invested as James has pointed out in his new thread about XIU performance since its beginning in 1999. In withdrawal, there are always opportunities to re-position.

Added: To be pointedly controversial and to poke the bear, I would suggest that if a retiree's portfolio continues to grow year after year in retirement, and if they are having "problems" finding things to invest in, then I assert they are not doing it right. 😉 The appropriate investment may be to spend more, or gift more or both. In my case, the pact I made with myself is that if I end the year with more net worth than I ended last year with, then I gift the difference (which is what I did in Dec 2020). A whole different subject for a different thread that we've probably talked endlessly about before as well.


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## agent99 (Sep 11, 2013)

AltaRed said:


> This forum shouldn't regularly be all about me....me....me, although it seems the majority of posts trend that way.
> 
> Added: To be pointedly controversial and to poke the bearell.


We do tend to talk about our personal experiences and beliefs. Regarding poking the bear - In your post #24 above, count how many sentences you started with "I"


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## AltaRed (Jun 8, 2009)

I am guilty of it as well.


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## Gator13 (Jan 5, 2020)

AltaRed said:


> ............ In my case, the pact I made with myself is that if I end the year with more net worth than I ended last year with, then I gift the difference.


I quite like this idea.


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## Eder (Feb 16, 2011)

I started gifting a few years ago as well...it really pains me to see what most of my kids do with "found" money though.


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## AltaRed (Jun 8, 2009)

Eder said:


> I started gifting a few years ago as well...it really pains me to see what most of my kids do with "found" money though.


The difference between now and after you are dead is that you won't know how they blow it after your death....perhaps 5 times as foolishly when Dad is not observing Which is worse?

That said, charitable giving (in kind) is a rewarding option (instead of, or in addition too). Creating an endowment with a foundation and/or targeting causes of choice can bring immense personal satisfaction. Out of literally hundreds of choices, there will be at least a few that line up favourably with your hot buttons.


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## AltaRed (Jun 8, 2009)

MrMike said:


> Not knowing what to buy depends on what you already own. I have $10K in RioCan and want to bring H&R up to that amount too; but if you already have enough money in your REITs, and many other sectors then sure, finding good stocks cheap can be harder. And like everyone else says, broad market ETFs if nothing else. Put that money to work!


One can make the case that owning the world via VEQT is a very good (no brainer) option.


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## MrMike (Sep 30, 2020)

AltaRed said:


> One can make the case that owning the world via VEQT is a very good (no brainer) option.


It's true and it's a great choice for some.

For me, I'm willing to sacrifice better returns for picking individual stocks and weighing dividends over growth. I find it make the journey more fun but to each their own. I like reading "Rogers bought Shaw" and then see how that affects my portfolio. AND you know, RioCan cutting its dividends was ... maybe not fun haha, but entertaining. Reading the articles, readjusting my spread sheet. If I had all my money in ETFs, I wouldn't need to bother with that. 

But while I find that fun and interest, the general public doesn't so something like VEQT is perfect for them.


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