Q: For the average person with a long time horizon and want to invest in stocks in the form of ETFs, what do you think is the optimal distribution of US, Canada Europe China etc? S&P 500 seem to have done better historically than other markets. But does that mean I should only invest in vfv?
And what do you think of the weighting of VEQT?
And what do you think of the weighting of VEQT?
5i Research Answer:
We would still prefer US investments, but Canadian residents need to watch currency risk. We think a general guideline would be 50% US, 35% Canada, 15% rest of world. Only going to the US may work in the short term, but international markets are much cheaper and one day will do better. The US is very strong now, but can see a crisis now and then. VEQT has done well. It is 44% US, 29% Canada, with the rest at 27%, with Japan highest at 4.5%. We would consider this a pretty good breakdown, especially if one wanted a bit more of an international tilt. Five year annualized is +10.72%.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in VFV.