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NEWMONT MINING $48.42 (New York symbol NEM; Shares outstanding: 490.2 million; Market cap: $23.7 billion; TSINetwork Rating: Average; Dividend yield: 2.9%; www.newmont.com) stopped construction of its 51.35%-owned Conga gold/copper mine in Peru in November 2011. The move was in response to protests by local farmers who fear the mine will contaminate water supplies.

Newmont has a long record of responsible mining in Peru. However, an independent group is now reviewing the $4.8-billion mine’s environmental impact. Meanwhile, Newmont has cut 6,000 jobs at Conga. That will lower its losses until it can restart the project. It also puts pressure on Peru to resolve the dispute.

Newmont is a buy.

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ISHARES DEX UNIVERSE BOND INDEX FUND $31.01 (CWA Rating: Income) (Toronto symbol XBB; buy or sell through brokers) mirrors the performance of the DEX Universe Bond Index. The 591 bonds in the portfolio have an average term to maturity of 9.45 years. The fund’s MER is 0.32%.

The bonds in the index are 69.2% government and 30.8% corporate.

The fund yields 3.2%, compared to the Short Term Bond Fund’s 2.9%. Its yield to maturity is 2.51%, 0.76% above the Short Term Fund. That reflects the added risk of holding long-term bonds.

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ISHARES DEX SHORT TERM BOND INDEX FUND $28.94 (CWA Rating: Income) (Toronto symbol XSB; buy or sell through brokers) mirrors the performance of the DEX Short Term Bond Index.

This index consists of a wide range of investment-grade federal, provincial, municipal and corporate bonds with between one- and five-year terms to maturity. The fund holds 295 bonds with an average term to maturity of 2.85 years. The bonds in the index are 64.2% government and 35.8% corporate. The fund’s MER is 0.26%.

iShares DEX Short Term Bond Index Fund yields 2.9%. However, this high yield is due to the fact that some of the fund’s bonds pay above-market interest rates. But as a result, they trade above their face value. When these bonds mature, holders will only get the bonds’ face value, which means the portfolio will incur predictable capital losses. These losses will offset some of the appeal of the above-market yields.

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TORSTAR CORP. $10.75 (Toronto symbol TS.B; Shares outstanding: 79.9 million; Market cap: $858.9 million; TSINetwork Rating: Above Average; Dividend yield: 4.7%; www.torstar.com) owns 90% of a company that publishes free commuter newspapers under the Metro banner in major Canadian cities; Sweden’s Metro International SA owns the remaining 10%.

Torstar now plans to expand Metro to Saskatoon and Regina. It will also launch Internet versions for four more cities: Hamilton, Kitchener and Windsor, in Ontario, and Victoria, B.C. These free publications should help the company attract more younger readers, who tend to avoid traditional newspapers.

Torstar is a buy.

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Pat McKeough responds to many personal questions on specific stocks and other investment topics from the members of his Inner Circle. Every week, his comments and recommendations on the most intriguing questions of the past week go out to all Inner Circle members. And each week, we offer you one of the highlights from these Q&A sessions. This past week, an Inner Circle member asked us about one of the mining stocks involved in the quest for rare earth metals. China’s iron grip on the rare earth market is a key factor in the pricing of these minerals, Pat notes, and he looks at how this stock is working to contest it with a re-opened mine and a new acquisition. ...

PRIMARIS RETAIL REAL ESTATE INVESTMENT TRUST $21.65 (Toronto symbol PMZ.UN; Units outstanding: 81.0 million; Market cap: $1.8 billion; TSINetwork Rating: Extra Risk; Dividend yield: 5.6%; www.primarisreit.com) owns large malls in medium-sized Canadian cities and suburban areas. In all, the trust owns 32 properties that contain 13.5 million square feet of leasable area.

Primaris has 44% of its properties in Ontario, followed by Alberta, 16%; B.C., 14%; Quebec, 13%; Saskatchewan, 9%; Manitoba, 3% and New Brunswick, 1%. Primaris has a 97.1% occupancy rate.

In the three months ended December 31, 2011, acquisitions pushed up Primaris’s revenue by 23.5%, to $104.1 million from $84.2 million. Cash flow rose 16.2%, to $34.7 million from $29.8 million. Cash flow per unit fell 3.2%, to $0.42 from $0.434, on more units outstanding. The trust yields 5.6%.

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ALLIED PROPERTIES REAL ESTATE INVESTMENT TRUST $26.07 (Toronto symbol AP.UN; Units outstanding: 51.9 million; Market cap: $1.4 billion; TSINetwork Rating: Extra Risk; Dividend yield: 5.1%; www.alliedpropertiesreit.com) owns 100 office buildings, mostly in major Canadian cities. These mainly Class I properties contain over 7.8 million square feet of leasable area.

Class I refers to 19th- and early-20th-century light industrial buildings that have been converted to office and retail space. They usually feature exposed beams, interior brick and hardwood floors.

In 2011, the trust bought 22 properties for $456 million. It now has 57 buildings in Toronto (which contain 42.9% of Allied’s leasable area); 15 in Montreal (35.9%); nine in Calgary (5.3%); seven in Winnipeg (5.3%); five in Quebec City (2.4%); four in Vancouver/Victoria (3.3%); two in Edmonton (3.7%); and one in Kitchener-Waterloo (1.2%). Allied has an occupancy rate of 94.3%.

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ENBRIDGE INC. $39.42 (Toronto symbol ENB; Shares outstanding: 782.2 million; Market cap: $30.8 billion; TSINetwork Rating: Above Average; Div. yield: 2.9%; www.enbridge.com) continues to expand in the U.S.

In November 2011, the company agreed to buy half of the Seaway pipeline for $1.15 billion U.S. Enterprise Product Partners LP owns the other half and operates the pipeline.

Right now, Seaway pumps crude oil from Houston, Texas, to storage facilities in Cushing, Oklahoma. But the partners plan to reverse the line’s flow by mid-2012.

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BELL ALIANT INC. $27.50 (Toronto symbol BA; Shares outstanding: 227.8 million; Market cap: $6.3 billion; TSINetwork Rating: Above Average; Dividend yield: 6.9%; www.aliant.ca) sells telephone and Internet services to 2.8 million customers in Atlantic Canada, as well as rural parts of Ontario and Quebec. The company also sells wireless services through an alliance with BCE, which owns 43.8% of Bell Aliant.

The company faces strong competition from cable providers. In addition, many of its phone customers are switching to wireless devices. However, Bell Aliant’s wireless agreement with BCE plus upgrades to its high-speed Internet network, are helping it hold on to clients and attract new ones.

Bell Aliant’s high-speed fibre optic systems now reach 458,000 homes. The company plans to expand this to 650,000 homes by the end of 2012.

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BROOKFIELD RENEWABLE ENERGY PARTNERS L.P. $26.32 (Toronto symbol BEP.UN; Units outstanding: 104.7 million; Market cap: $2.8 billion; TSINetwork Rating: Extra Risk; Dividend yield: 5.2%; www.brpfund.com) has finished merging its assets with the extensive hydroelectric and wind power holdings of Brookfield Asset Management (symbol BAM on Toronto).

Brookfield Renewable now owns 170 hydroelectric generating stations, three wind farms and two natural-gas-fired plants. It has 4,536 megawatts of generating capacity in total.

Roughly 40% of Brookfield Renewable’s generating capacity is in Canada, with another 40% in the U.S. and 20% in Brazil. The company sells virtually all of its power under agreements that are an average of 24 years in length.

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ENCANA CORP. $18.92 (Toronto symbol ECA; Shares outstanding: 735.4 million; Market cap: $13.9 billion; TSINetwork Rating: Average; Dividend yield: 4.3%; www.encana.com) uses hydraulic fracturing, or fracking, to recover natural gas from shale deposits. This process involves pumping a mix of water, chemicals and other materials into the shale formations. This fractures the rock and releases the gas.

In December 2011, the U.S. Environmental Protection Agency (EPA) published a draft report that claimed fracking chemicals at Encana’s Wyoming well contaminated local drinking water.

However, Encana disputes the findings. This week, the EPA announced that it would re-test the area’s aquifer as part of a larger study that it is conducting on the impact of fracking on drinking water.

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MARKET VECTORS VIETNAM ETF $19.18 (New York symbol VNM; buy or sell through brokers; www.vaneck.com) holds shares of Vietnamese companies or foreign firms that get a significant amount of their revenue from Vietnam.

Market Vectors Vietnam ETF was launched on August 11, 2009. Its expense ratio is 0.76%.

The ETF’s top 10 holdings are Vietin Commercial Bank, 8.2%; Vincom Corp. (real estate), 7.9%; JSC Bank, 7.5%; Baoviet Holdings (Finance and insurance), 6.7%; PetroVietnam Fertilizer and Chemical, 5.4%; Premier Oil plc (a U.K. producer with a 53.1% stake in the huge Chim Sao oil project offshore southern Vietnam), 4.2%; Charoen Pokphand Foods (a Thailand-based food conglomerate), 4.1%; Oil & Natural Gas Corp. (an India-based oil and gas company), 4.0%; Gamuda Bhd (a Malaysia-based construction group); and Hoang Anh Gia Lai Group (real estate development), 3.8%.

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CANADIAN PACIFIC RAILWAY $75.47 (Toronto symbol CP; Shares outstanding: 170.9 million; Market cap: $12.9 billion; TSINetwork Rating: Average; Dividend yield: 1.6%; www.cpr.ca) continues to expand its rail network in the Bakken area, which could contain more than 500 billion barrels of oil. This region covers parts of Montana, North Dakota and Saskatchewan.

Texas-based U.S. Development Group LLC is almost finished building a new hub in North Dakota to handle Bakken’s rising production. This hub will transfer oil from trucks to trains, which will then ship it to market.

CP is the only railway that will connect to this hub. That puts it in a great position to profit as shale oil and gas production continues to increase: the company expects its shipments from Bakken to jump to 125,000 barrels a day from 23,000 in 2011.

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GUGGENHEIM CHINA SMALL CAP ETF $21.70 (New York Exchange symbol HAO; buy or sell through brokers; www.guggenheimfunds.com) aims to track the AlphaShares China Small Cap Index, which is made up of all Chinese stocks that are legal for foreign investors and have market caps between $200 million and $1.5 billion.

The $168.8-million fund’s top holdings are Alibaba. com, 1.7%; Zoomlion Heavy Industry, 1.3%; Longfor Properties, 1.2%; Sino-Ocean Land Holding, 1.2%; Guangdong Investment, 1.6%; Tsingtao Brewery Co., 1.6%; Golden Eagle Retail Group, 1.2%; Shanghai Industrial Holdings, 1.1%; Zhaojin Mining Industry, 1.1%; and Digital China Holdings, 1.1%.

As China’s economy matures, domestic spending should continue to rise. As well, China’s leaders will likely need to increase spending on programs and services to ease the growing gap between the rich and poor. Guggenheim China Small Cap ETF is well positioned to benefit from both of these trends.

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SPDR S&P CHINA ETF $68.38 (New York Exchange symbol GXC; buy or sell through brokers; www.spdrs.com) is an exchange traded fund that aims to track the S&P China BMI Index. This index is made up of all the publicly traded Chinese stocks that are available to foreign investors. Right now, SPDR S&P China ETF holds 184 stocks.

The $879.6-million fund’s top holdings are China Mobile, 7.7%; China Construction Bank, 7.5%; Baidu, 5.4%; Industrial & Commercial Bank, 5.1%; CNOOC, 4.6%; PetroChina, 4.2%; Tencent Holdings, 3.9%; Bank of China, 3.5%; China Life Insurance, 2.7%; and China Petroleum & Chemical, 2.6%.

The fund’s breakdown by industry is as follows: Financials, 31.0%; Oil and Gas, 15.9%; Information Technology, 13.8%; Industrials, 10.2%; Telecommunication Services, 10.1%; Consumer Discretionary, 5.5%; Consumer Staples, 5.0%; Basic Materials, 4.4%; Utilities, 2.3%; and Health Care, 1.6%.

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BCE INC. $40.21 (Toronto symbol BCE; Shares outstanding: 775.6 million; Market cap: $31.2 billion; TSINetwork Rating: Above Average; Dividend yield: 5.4%; www.bce.ca) is buying Astral Media Inc. (Toronto symbols ACM.A and ACM.B). The move follows BCE’s recent $533 million purchase of 37.5% of Maple Leaf Sports and Entertainment.

Montreal-based Astral owns 22 TV stations, 84 radio stations and several pay TV and specialty channels, such as The Movie Network, Family Channel and Teletoon. It also owns billboards and sells other outdoor advertising services in Quebec, Ontario and B.C.

The purchase price is $3.4 billion, including $380 million of Astral’s debt. BCE will pay roughly 75% of this cost in cash and 25% in common shares. To put this purchase in context, BCE earned $2.4 billion, or $3.13 a share, in 2011.

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MANITOBA TELECOM SERVICES INC. $34.82 (Toronto symbol MBT; Shares outstanding: 66.2 million; Market cap: $2.3 billion; TSINetwork Rating: Average; Dividend yield: 4.9%; www.mts.ca) gets 55% of its revenue from its MTS division, which has over 1.3 million telephone and wireless customers in Manitoba.

The remaining 45% of the company’s revenue comes from its Allstream division, which provides integrated telephone, Internet and other communication services to businesses across Canada.

In the quarter ended December 31, 2011, revenue fell 1.6%, to $439.4 million from $446.7 million a year earlier. The MTS division’s revenue rose 2.7%. Allstream’s revenue fell 6.6%, mostly because it is closing less profitable businesses. Earnings per share rose 21.7%, to $0.56 from $0.46, on cost cuts and higher profits at Allstream.

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I’d say a product walking out of the store is a good reason for further study, but don’t buy blind. Because there might have been a temporary

There’s no limit to the types of financial questions members of my Inner Circle can ask me and my team of investment experts. Aside from questions on specific investments like stocks and exchange-traded funds, members ask us many other questions about how they should be investing their money. One very interesting question came from a member who asked whether there is any advantage to investing money in a prepaid funeral. So you can get a sense of how our Inner Circle works, I’d like to share this question, and our answer, with you. Q: At 57 years old, it seems reasonable to me to lock in funeral costs at today’s prices and pay for it now. This makes even more sense since I can reasonably expect to live another 25 years. Funeral costs for any level of funeral have doubled every 10 years over the past 30 years, according to the brochure. Does this make sense to you?...

Some investors rely on technical analysis (basically, chart reading) when picking stocks. Relying on charts seems simpler than delving into a company’s fundamentals.

POTASH CORP. OF SASKATCHEWAN $43 (www.potashcorp.com) has cut potash production because rising inventories have pushed down prices. However, poor weather in South America will likely cut this year’s soybean harvest....

NORDION INC. $9.08 (www.nordion.com) continues to have success with TheraSphere, a process that it developed for treating liver cancer using millions of small glass beads that contain radioactive materials....

LINAMAR CORP. $21 (www.linamar.com) earned $1.64 a share in 2011. That’s up 20.6% from $1.36 in 2010. Sales rose 28.4%, to $2.9 billion from $2.2 billion. The company continues to win new contracts to supply transmissions and other parts to carmakers in Asia and Europe....

TECK RESOURCES LTD. $35 (Toronto symbol TCK.B; Conservative Growth Portfolio, Resources sector; Shares outstanding: 586.0 million; Market cap: $20.5 billion; Price-to-sales ratio: 1.8; Dividend yield: 2.3%; TSINetwork Rating: Average; www.teck.com) is a leading producer of metallurgical coal, a key ingredient in steelmaking. Coal accounted for 49% of Teck’s 2011 revenue and 57% of its earnings. The company also produces copper (27%, 28%) and zinc (24%, 15%).

Teck continues to benefit as the recovering global economy pushes up commodity prices. As well, in 2008, the company bought the 80.05% of Fording Canadian Coal that it didn’t already own. This purchase has further spurred Teck’s growth.

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LOBLAW COMPANIES LTD. $33 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 281.4 million; Market cap: $9.3 billion; Price-to-sales ratio: 0.3; Dividend yield: 2.5%; TSINetwork Rating: Above Average; www.loblaw.ca) is buying most of the Zellers department store chain’s prescription drug accounts.

U.S.-based Target Corp. (New York symbol TGT) recently acquired over 220 Zellers stores as part of its plan to expand into Canada. However, it will take Target several months to renovate these locations. As a result, Target decided not to take over Zellers’ drug business and will instead open its own pharmacies in these stores.

Loblaw will pay $35 million for the Zellers accounts. That’s equal to 5% of its 2011 earnings of $769 million, or $2.73 a share. Selling drugs is more profitable than sales of food or general merchandise, so these new accounts should boost Loblaw’s earnings. The purchase will also draw more traffic to Loblaw’s stores.

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