Fund Library Q&A with Gordon Pape

Questions on geographic allocations, gold, Brookfield and Fairfax

Time to open the mailbox to answer questions submitted by readers.

Geographic stock allocations

QUESTION – I was wondering what geographic allocation between U.S., Canada, and international you would currently recommend for a 100% equity growth portfolio. – Arcady B.

ANSWER – An all-equity portfolio suggests your goal is high risk/high return. In that case, I’d suggest 50% U.S., 30% Canada, and 20% international. U.S. stocks are very expensive but still have some momentum working for them, so keep riding that wave while it lasts.

For more conservative investors, a mix of 30% U.S., 40% Canada, and 30% international seems like a good fit. In general, both Canadian and European stocks have lower p/e ratios than the overheated U.S. market.

Gold mining ETF

QUESTION – I’d be really interested in your thoughts on a new position in CI Gold+ Giants Covered Call ETF (TSX: CGXF). – David M.

ANSWER – That really depends on your view of where gold is going. You’d think the intensification of the Iranian war would drive gold prices higher, but that has not been the case so far.

The investment objective of this ETF is to provide opportunity for capital appreciation through an actively managed equal-weighted portfolio of at least the 15 largest North American gold and precious metals companies. The fund aims for lower overall volatility of returns on the portfolio than would be experienced by owning a portfolio of gold-based securities.

The fund uses a covered call option writing program. The issuers included in the portfolio, which are based on their market capitalization, may be adjusted based on the portfolio manager’s view on the liquidity of the issuers’ equity securities and their related call options.

This fund is best suited to those who want North American equity exposure to companies in the gold sector plus the potential for high income generation.

So, how well does it deliver on those goals? For the year to July, the fund gained 29.5%. That looks good, until you consider all that growth was in 2025. In 2026, the fund was showing a loss of 14.3% to July 31. Since it was launched in mid-2001, the fund shows an average annual compound rate of return of 3.5%.

What about distributions? They are paid monthly and the amounts vary significantly. For example, in March investors received $0.7086 per unit, but in June it was only $0.1681. The 12-month trailing yield is 13.1%.

The bottom line is that gold has lost its momentum for now, and there is no way of knowing when it will recover. If the strong cash flow keeps you happy while you wait, go ahead and buy some units. If your main interest is to earn capital gains from a rebound in gold, you may have to wait a while.

Brookfield puzzle

QUESTION – As a Buy-and-Hold investor, my holdings in Brookfield have gone from Brookfield Asset Management (BAM) and Brookfield Infrastructure Partners (BIP.UN) to now include Brookfield Corp. (BN) and Brookfield Wealth Solutions (BNT). Would you advise leaving them as is? Or would you recommend amalgamating some or all of them into one Brookfield security and, if so, which one? Thank you. - Carol H.

ANSWER – Good question, and one I think many Brookfield investors would like to have clarified. Unfortunately, there is no simple answer.

First, a little history. Brookfield Asset Management used to be the name for the parent company. In December 2022, that was changed to Brookfield Corp. and the stock started trading under the new ticker symbol BN. At the same time, a newly spun off asset management business took over the historic BAM ticker symbol. So, prior to that date, BAM was the symbol for the whole business. Now it represents only one aspect of the company.

The answer to your question of which shares to keep comes down to whether you believe the individual sectors will outperform the parent company. Let’s look at some numbers.

Year-to-date (Aug. 21)
BAM: -0.5%
BIP.UN: +12.3%
BNT: -9.9%
BN: -3.5

Five years (cumulative)
BAM: +147.9%
BIP.UN: +12.5%
BNT: -25.7
BN: +49.1

At first glance, BAM seems like the runaway winner, long term. But remember that for part of the five-year period, BAM was trading as BN. As a stand-alone entity, BAM shares started to take off in late 2023, peaking in the summer of 2025.

BIP.UN is the best performer in 2026, but over the past five years it has an abysmal record. BNT has not done well.

As there is no clarity here, I would advise consolidating your Brookfield assets into the parent company, Brookfield Corp. (TSS: BN).

There are other stand-alone Brookfield companies, including Brookfield Renewable Partners (TSX: BEP.UN) and Brookfield Business Corp. (TSX: BBUC), but neither has an impressive record.

What’s up with Fairfax Financial?

QUESTION – I have been a long-time reader and have always appreciated your insights and direction.

Having read the Aug. 15 article about Fairfax Financial in The Globe and Mail, I was surprised to learn of its decision to sell out of its long-standing BlackBerry position. Given Fairfax’s history with BlackBerry and the significance of Prem Watsa’s decision to exit the investment, I was wondering what you think this means for Fairfax Financial as an investment going forward.

I currently hold a significant investment in the company. In light of this development, would you consider FFH a hold, or do you see this as a reason to sell at this point? – Robert L.

ANSWER – This is Fairfax CEO Prem Watsa biting the bullet on one of his long-standing individual positions. BlackBerry hasn’t worked out, unlike several of his other investments. No reason to be concerned. Fairfax remains a Hold, as it has done well but has become fully valued.

Gordon Pape is one of Canada’s best-known personal finance commentators and investment experts. He is the publisher of The Internet Wealth Builder and The Income Investor newsletters, which are available through the Building Wealth website.

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Notes and Disclaimer

Content © 2026 by Gordon Pape Enterprises. All rights reserved. Reprinted with permission. The foregoing is for general information purposes only and is the opinion of the writer. Securities mentioned carry risk of loss, and no guarantee of performance is made or implied. This information is not intended to provide specific personalized advice including, without limitation, investment, financial, legal, accounting, or tax advice. Always seek advice from your own financial advisor before making investment decisions.

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