Investors need to watch the accounting on weed stocks + MORE Jan 28th

Different investment products need to be tapped in different ways to generate income in retirement. (Flickr)
Q. I have $500,000 that I would like to invest in the Horizons S&P/TSX 60 Index ETF (HXT). I like the fact that this ETF does not make distributions, so there is no income tax to be paid before the shares are sold. I want to use the account to pay me a “return of capital” of $3,000 per month. Is that possible? If not, is there another way to do it? – Luc B.
The Horizons S&P/TSX 60 Index ETF (HXT) is what’s called a “swap-based ETF,” and it works differently from a traditional index fund. The ETF’s benchmark includes 60 large Canadian companies, but HXT does not actually hold the stocks directly. Instead, it enters an arrangement with a “counterparty” (a bank) that promises to deliver to the ETF the same total return as the index.
The main appeal of tax-advantaged, swap-based ETFs is they don’t pay dividends in cash: instead, they increase in price by an amount equal to the dividend…

Find one dividend ‘safer dog’ as overachiever and one as dog of the dogs. (Flickr)
Each January, I like to create a little challenge that adds a bit of flavour to the Safer Canadian Dogs strategy. All it takes is to pick the best and the worst of Canadian dividend stocks.
The challenge is modelled after the one I ran last year.  The goal is to build a fantasy portfolio using the 10 dividend paying stocks in the Safer Canadian Dogs list.  Each fantasy portfolio starts with an equal amount of money in each stock.  You can play along at home. All you  do is pick one of the stocks to buy and one of the stocks to sell.  After making that fateful choice, each fantasy portfolio is fixed for the year with $20,000 in the favourite stock, nothing in the one that was sold and $10,000 in each of the remaining eight.  Kudos go to the investor with the best performing portfolio.
The Winners from 2017
You can see how each of last year’s Safer Canadian Dogs fared in the table below…

Be sure to frame exactly what you’re looking at when you look for investing answers. (Flickr)
Cost is important – especially for big-ticket purchases.  If you were looking to make a major purchase and you had to choose between two options that were broadly similar, I suspect that a major element of the decision-making process would involve a determination revolving around how much the options cost.  That’s just natural.  Seeing as that is the case, here are some questions for you:

What amount of concern would you have if I told you one option cost 1 percentage point more than another?
What amount of concern would you have if I told you one option cost 5 times more than the other?
What if I told you I was asking the exact same question, only framing it differently?

Let’s say the big-ticket item in question is how much you’ll be paying over the course of your lifetime for access to a broadly-diversified investment portfolio that is customized to your needs and circumstances?  Intrepid puzzle-solvers would quickly realize that the costs for the two options are fairly obvious: 0…

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Depending on your point of view, the burgeoning marijuana industry in Canada is either an unprecedented opportunity to rake in huge profits as recreational use becomes legal, or a speculative bubble that will eventually pop. When forensic accountant Al Rosen looks at the sector, he sees something else: “It’s a bloody mess,” he says.
Rosen is referring to the financial statements of the country’s publicly traded licensed producers. Accountability Research Corp., which Rosen runs with his son, Mark, is warning those statements are misleading and allow companies to overstate profitability. “Canadian reporting of marijuana growers sets a new low for integrity,” the Rosens wrote in a recent report. It’s not that companies are intentionally duping investors—though there is ample opportunity for that, the Rosens argue. Instead, companies are trying to apply already-vague accounting rules to a new industry. Companies have to put a value on their marijuana plants for accounting purposes, even though pricing and future demand are not yet known…