portfolio design, 5-year horizon, 5%+ target return
I would love to hear everyone's opinions on how to construct an optimal portfolio with a 5-year horizon with the expected return of 5% or higher.
In my understanding, such a portfolio would consist of bonds, properly chosen Canadian dividend stocks and preferred stocks. Here are my other thoughts:
1) In present finacial conditions (low-rate environment), investing in bonds would make little sense. Perhaps, cash/cash equivalents should comprise the income part of the portfolio.
2) Canadian dividend stocks would include mature companies that are market leaders and delievered consistent financial results. What would be the right amount of stocks for, say, a 50k portfolio?
3) I am not sure what the right mix (given input parameters) of asset classes is.
4) I don't have experience working with preferreds. Is it possible to avoid them in my setup? What would be the best resource to learn about this asset subclass?
Your input is appreciated.