Investment Q&A

Q: As part of my shift from managed products to ETFs I need to top up all or a combination of ve, spy and xef. This will be a rather large transaction so I am leaning towards 25% of the amount in each ETF and keeping 25% in cash counting on covid related market dips over the next few months.

Q: Good morning, Peter/Ryan!
I am interested in finding more detailed info about European and emerging market dividend paying stocks, essentially of the "blue chip" variety. Do you know of any specific resources that provides coverage in that area? As well, would you by chance have any recommendations of specific stocks and/or ETFs along those lines … maybe 4 or 5?
Thanks a lot!
Paul

Q: IF and that is a big IF we have all missed the bottom on American larger caps should I be now focusing on US small caps and International markets? When I look at SPY and VIG all th money has jumped into American large caps and more or less erased the huge loss and pairs back some of my gains from 2019...so huge collapse gone...for now. I've topped up some VIG but missed on SPY. When I look at US small caps they are lagging and I assume this is due to the higher risk and lower volume, Same story for Europe, International and emerging markets. So my question is should I be shifting to adding IWO, XEF, and VE. I need to add some international content to my portfolio anyways as I am a bit light at 12% international ( developed) and 10% emerging markets. If you agree or don't strongly disagree what ETFs do you recommend right now ( I already hold the one mentioned). I am leaning toward a bit of IWO and larger positions in VE and XEF.

5 year window, high but slowly lowering risk tolerance, Balanced portfolio follower ( shifting slowly to income follower), overweight canada (40%) and US(40%) ,

Q: I understand that a covered call investment is not the holding to have during a market rebound.

Instead of ZWE, which ETF would be appropriate holding to capitalize on a rebound.

Q: Hi 5i, Another question about your model ETF portfolio.
This one is about VE-T and VEE-T.
They trade on the Toronto exchange, Does that make them like Canadian ETFs?
I mean, are their dividends eligible for the tax credit? Or are they fully taxed, just like US
ETFs?
Many thanks. Shan

Q: Building up my ETF portfolio and have some cash to deploy. Of XEF VE and SPY which is the best one to add right now. Crystal ball yes...balanced follower, 5 year time horizon. I am currently over allocated to Canada and on target for emerging markets a little light USA and international. Likely to buy a bit of each if not strong case for one in particular.

Q: Hi 5i,
Happy New Year.
In the original asset allocator there was a suggested portfolio in ETFs. Mine has vanished! I was trying to look up possible ETFs in European or International small caps.
Are there any? Or would GIB, WSP,Altus or CAE count as international as well as Canadian?
Constance

Q: Your thoughts for long term hold, 5 years

Q: May I please have your opinion of FDD - First Trust Dow Jones Stoxx European Select Dividend Index Fund for European Exposure. Thanks in advance.

Q: I found your response to Leonard’s question regarding which accounts international ETFs are best placed quite interesting. I hold large positions in both VE and VEE in a registered account. If I understand your response it means that I am paying a withholding tax twice (on US and International side) with no recourse to claim it back. If staying within a registered account, what two ETF would you recommend to replace VE and VEE for better tax efficiency? Would you endorse immediately switching and would there be any drawbacks to making such a switch?

Q: Hi,

I own both these funds. Both are held in a TFSA, and I am looking for "total return". I was thinking of selling one and adding to the other.

1. Is there a lot of overlap between the 2 ETF's? (I noticed on some trading days, they sometimes have a negative co-relation).

2. If you were sell one and add to the other, which would you sell? Or would you simply keep both "as is".

Thanks,

Craig

Q: Hi, could you list ETFs that you would recommend that hold mainly European companies & ETFs that hold European indexes. Thanks … Cal

Q: I bought these ETF's a couple of years ago for diversification purposes. They have not performed well and I am wondering if I should keep them or move on and forget about diversifying outside of North America. I do not like exchange risk.

Q: What is your opinion of these equities which I have held in a well-diversified portfolio for a number of years?

Q: We have( for me) a quite large sum of money invested in managed products. Any new money is going into Canadian equities ( 30%) following your portfolios and a mix of ETF roughly
30% USA at 10% SPY, 10% VIG, 10%IWO
30% International currently VE
10% emerging currently VEE
( I know "where is your fixed income" you ask, my spouse has a federal government pension which I count as our fixed income)
To date these sums are relatively small. As I start to shift large sums from our managed products to my self managed portfolio ( following the above ratios) I am ok with the mix in the USA spread to 3 etfs run by 3 different companies. With the international and emerging I am a bit concerned about putting all that cash with one fund (and company). Is this concern silly or should I have some diversification within my ETF holdings ( both in terms of funds and companies). For example instead of having 30% of my holdings in VE I would split it 15% VE and 15% XEF. So I guess the short questions are:

1. What is the max an investor should have in any one ETF( %)
2. What is the max an investor should have with any one company ( $ or %)

Q: Hi 5i
I am completely new to the world of ETFs but, according to Portfolio Analytics (and I did know it was a good idea before being told, really I did) I need to add US and International exposure to my portfolio. I think the only reasonable way for me to do that given I don't/can't follow non-Canadian equity markets is through ETFs.
I would like to place 55K in US ETFs and 45K in International ETFs and this will, for now, comprise the entire non-Canadian portion of my portfolio.
I am not adverse to some above average risk and while I'd like income I'm more interested in growth.
In researching where to place this money I've concluded that I might not have the candle power necessary to make rational decisions about ETFs because of the distinct possibility of purchasing ETFs that hold the same or similar underlying equities from the same or similar geographies in the same or similar sectors (assuming I'm not just concentrating on discrete sectors). Left to my own devices I feel that I could very possibly purchase a little bundle of different ETFs that are all essentially but unintentionally quite similar.
My question is two-fold:
1. Is my concern about concentration valid or have I misinterpreted the lay of the land, and
2. Could you suggest 4 or 5 US ETFs and a similar # of International ETFs that I can consider and that won't have the type of overlap I'm worried about.
I realize this is a broad and general (and perhaps rambling) question - so please deduct as many credits as you think is warranted.
Thanks a lot!
Peter

Q: Hi, thank you for the article on international stocks and the portfolio analytics.
I am now trying to decrease my Canadian home bias (40% to 25%) by increasing my international exposure (20% to 35%) and maintaining my US at 40%. My wife and I own XWD, VE and XEF in our TFSAs. I was thinking of selling XWD and adding VEE or VWO (RRSP) and/or VDU or VEA (RRSP). The switch to RRSP additions is to benefit from US withholding tax exemption.

Could I have your thoughts on the above changes. Is there too much overlap in owning all four ETFs? Could I simplify to one, two or three?

Thank you.

Q: We have a diversified RIF and are now in our 70s . We have 6 ETFs and have $20,000.00 invested in VE. We have equities invested across all sectors some sectors a higher percentage than others. Do you feel it is necessary to have monies invested in Europe when we could obtain better income investing in possibly Bonds or preferred shares. Safety and Income are important now to us . Any recommendations.

Q: I purchased these ETF's a little over a year ago as my first outside of North America holdings. Just wondering what your thoughts are about these. I do have a long time frame.

Q: I have about $10,000 I would like to get some non-U.S., foreign exposure with. Maybe an ETF or 2, a dividend would be great but not if it takes away all the growth. Would you recommend China, India or Europe? I know it will limit my choices but I would like to purchase it in Canadian dollars. Thank you so much :-)