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Discussion Starter · #1 · (Edited)
Hi everyone. I'm thinking of streamlining my investments to mostly ETFs while keeping a few companies I like and I wanted to get other peoples thoughts on the matter.

For my TFSAs, I made a list of the ETFs I like from Vanguard:
  • VCE - Canadian Market - 36%
  • VFV - US Market 50%
  • VE - European Market 7%
  • VA - Asia Pacific Market 7%
For FRESP or RDSP where I have a smaller amount of money to work with, I would use VEQT - Mostly North America, some Global.

If I ever want higher dividends, I would go with VDY - Canadian dividend paying companies.

Other Investment Companies
I looked at iShares, TD and BMO ETFs but I feel like Vanguard had mostly what I want.

Example, BMO has a China ETF but I rather use VA for exposure to more Asian markets.
Or, TD has TGGR but I could just use VDY above.

Your Input

Going forward I would like to invest in:
  1. Mostly Equity/Growth ETFs
  2. A few specific companies I like
So my questions to you are:
  • What do you think of those 6 Vanguard ETFs?
  • Are there other ETFs I'm not thinking about?
  • Are there ETFs you use from the other 3 (or anywhere else) that you like?
Thanks everyone.
 

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You could replace VE + VA by VIU for simplicity.

Why not VCN instead of VCE? I think it could be worth it with the coming business cycle to capture mid/small cap companies.

Some would say you could just replace all of that with VEQT, though personally I don't like the chunk of emerging markets that's in there. Not for investing reasons, but because it goes against personal values.
 

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Discussion Starter · #3 ·
That sounds great, combine VE/VA and just do VIU. Great suggestions.

The real goal with the ETFs is to get the most price appreciation. A secondary goal is to be diversified - It's nice to think I have some money in all of Canada (VCN) but ultimately, it's about the returns :) That said, VCE just barley wins out.

That's the thing, should I just go with VEQT? By going with the other 3 (VCE, VFV, VIU), I thought I could control how much goes into Can/US/Europe+Pacific. There difference between choosing those 3 vs VEQT is probably very minimal.
 

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That's the thing, should I just go with VEQT? By going with the other 3 (VCE, VFV, VIU), I thought I could control how much goes into Can/US/Europe+Pacific. There difference between choosing those 3 vs VEQT is probably very minimal.
The thing is: While rolling your own with 3-4 separate ETFs does give you control, what do you know better than anyone else what your geographic distribution should be? What are you going to do with that decision making ability? Just hunches and guesses on your part I think, potentially chasing performance? I don't think anyone knows other than pure luck/coincidence.

If you consider VEQT, also look at XEQT for a slightly different geographic allocation distribution. No one knows which of those will outperform long term either.
 

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Discussion Starter · #5 ·
I wouldn't do it because I think I can do a better job at distributing funds. It's all in my head; with VEQT, I'm forced to put $4.60 cents from every dollar into Japan. Where as with the others, I may put $5K into VA so I feel I'm exposed, but then load up on FVF. But I know "feeling good" isn't the main goal - it's for the best returns.

So is putting $5K in VA and $20K in FVF better than having $25K in VEQT? Lets just assume VEQT is made up of Asia/Pacific and US for this example :)

If the answer is so minimal, I might as well just stick with VEQT for simplicity. In this case, is having 60% of my portfolio is VEQT acceptable? I've heard never put more than 20% of your portfolio in a single stock but that's probably more towards individual companies, not ETFs with many, many different companies.
 

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I have no interest in debating your supposed superior geographic allocation abilities. I do suggest you compare the CAGR performance of your portfolio with VEQT or XEQT over the next 10 years and tell is on an annual basis through July 2031 how you actually did versus VEQT/XEQT. After all, that is what it is all about, no?
 

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In this case, is having 60% of my portfolio is VEQT acceptable? I've heard never put more than 20% of your portfolio in a single stock but that's probably more towards individual companies, not ETFs with many, many different companies.
That is indeed towards individual companies.

Holding your whole portfolio in one of these broad based ETFs such as VEQT is no problem at all. In the off chance that Vanguard went bankrupt (VERY unlikely), you would still be OK as the value of the underlying securities would be given to you.
 

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I do some of mine in USD ETF's
VTI for US S&P500
VBR for us small cap value,
IYW for a tech slant,
IXUS for global excluding US.
AGG for a mix of US bonds, so not all my bonds are canadian
 

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Discussion Starter · #12 ·
Replace with XEQT
Why would you pick XEQT over VEQT?

I'm leaning towards XEQT because:
XEQT has 0.02% less MER - very small difference but I'll note it anyways.
I do like XEQT's 47%US/23.5%CAN ratio more than VEQT's 42%US/29.5%CAN - If this is a 1 buy everything, I think you would get better returns with the US market than Canadian.
 

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Hard to beat VTI . It represents the entire US market . As Buffet said no one ever got ahead by betting against the US economy. In terms of Europe and Asia I remember Bogle saying you get instant international exposure with the S&P500. Take a look at the US large caps they do business everywhere except North Korea and Cuba. Cat, Deere, Boeing , Apple, Google , Microsoft, FB, Heinz/Kraft, McDonald's and many others.
 

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Hard to beat VTI . It represents the entire US market . As Buffet said no one ever got ahead by betting against the US economy.
Probably better to globally diversify. The US has had an amazing run, but really they were just the beneficiary of surviving those two world wars instead of getting destroyed, as Europe did.

Buffett is a smart guy but he's way too US centric, probably because he got burned badly by his investments in Japan in the 1980s. He's still human and his Japanese experience probably soured him to global investing.

Global diversification is the best strategy. Don't concentrate too heavily in just the US.
 

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Probably better to globally diversify. The US has had an amazing run, but really they were just the beneficiary of surviving those two world wars instead of getting destroyed, as Europe did.

Buffett is a smart guy but he's way too US centric, probably because he got burned badly by his investments in Japan in the 1980s. He's still human and his Japanese experience probably soured him to global investing.

Global diversification is the best strategy. Don't concentrate too heavily in just the US.
the mega cap US companies are big international players.. Which vaccines are in demand globally? I travel internationally and Mcdonalds is everywhere along with Coke Cola and Pepsi. Aren't the EU people concerned about US tech domination with Apple, Google, Microsoft, FB and others. You name it and US multi-nationals have a major place in all sectors including Asia and Europe.I think Bogle was right. It just simplifies investment. I have a hard time getting cranked up about European companies. . Japan has be a no growth economy for 30 years. Buffet might make mistakes but a 20% plus average return for 50 years isn't bad.
 
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