Gyroscopic Investing

Thanks CA PP and Gosso.

Gosso,

I called CIBC Investor's Edge today.
The exchange trade rates (vary daily, and intradaily). Today: 1.14% CAD > USD and .986 USD > CAD for the first $25K.
So, it's good idea to check the rates (you have to call at Investor's Edge) when you know you want to make the trade.

I forgot to ask if one can buy individual US Treasury bonds. They are not listed on their website.
Investor's Edge does not allow you to hold USD cash in either RRSPs or TFSAs,.
Eventhough I have a CIBC USD savings acct, I cannot transfer to my CIBC brokerage accts to make US trades.

Thx for the info from Moneysense re: making larger exchanges without eating as many fees.
I cannot wait to get home and read the Moneysense magazines I missed while snowbirding!!!

CA PP,

Thanks for the analysis.
I went on the Stingy Investor Asset Tool and looked at CA PP returns.
What is not clear to me just what the definition of "Canada Long Bonds" is.
Are they pure Canada Treasuries, or a mix of corporate, munis, provincial and federal government and how would this possibly affect returns?

bluedog wrote: I went on the Stingy Investor Asset Tool and looked at CA PP returns.
What is not clear to me just what the definition of "Canada Long Bonds" is.
Are they pure Canada Treasuries, or a mix of corporate, munis, provincial and federal government and how would this possibly affect returns?

I found the answer for you:

SCM Long Term Bond Total Return Index is a specific measure of total return for the Canadian long-term bond market, covering approximately 250 marketable Canadian bonds with term to maturity greater than 10 years. Bonds are weighted on a market value basis, including accrued interest, and emulate "real world" bond portfolios. Bond categories include Federal, Provincial, Municipal and AA through BBB-rated corporate issuers. This index is calculated by Scotia Capital Markets Inc.
Source: http://www.globefund.com/static/faq-charts-indexes.html

Obviously that is not what Harry Browne had in mind, but it's all we got.  It is still a useful tool for giving us a rough idea of how the CA PP performed in the past.

If I plug in 10% 3-month bills, 40% Long Bonds (this higher percentage helps account for the lower maturity dates), 25% Canadian stocks, 25% gold, then we get a return of 10.54% with a standard deviation of 8.85%.  Not bad, it still shows things work pretty well.

Thanks Gosso for the clarification and the adjusted CA PP returns.

I feel intuitively some USD exposure for a Canadian in their CA PP would be a good thing, given USD as the reserve currency and our economic ties.
I'm still grappling with what that should be specifically.

Clive,
You never cease to amaze me with your graphics and analyses that are way beyond my scope.
You are one deep thinker!
I keep thinking if I look at them long enough, the answer will pop right out at me.
But it never seems to happen...I must plead ignorance and admit I am blonde!
What does this all mean, in your mind, for a CA PP?
Thank you for your thoughts.