My NEW Wealthsimple ETF/Index Fund Portfolio 2024

Summary

The speaker shares their transition from individual stocks to an ETF portfolio, highlighting the simplicity and efficiency of this approach. They detail their choice of two ETFs, the Vanguard S&P 500 Index ETF (VO) for US market exposure and the BIMO All Equity ETF (ZQT) for a diversified global allocation. The decision to switch was driven by a desire for a more passive investment strategy that offers peace of mind and aligns with their current life phase, including family and career priorities. The speaker emphasizes the importance of self-reflection for DIY investors to choose a strategy that suits their life stage and goals.

Takeaways

• 😀 The speaker has transitioned from individual stocks to an ETF portfolio and is finding the change beneficial.
• 📈 They are currently transferring their TFSA from Questrade to Well Simple and have two ETFs in their RRSP: VO (Vanguard S&P 500 Index ETF) and ZQT (BMO All Equity ETF).
• 💼 The speaker has a significant amount of cash yet to deploy in their portfolio and plans to do so over the coming weeks and months.
• 🌐 VO provides exposure to the 500 largest U.S. companies with an expense ratio of 0.03%, making it a cost-effective choice.
• 🌐 ZQT is an all-in-one ETF with a 0.20% expense ratio, offering a pre-set asset allocation to various markets including the U.S., Canada, international, and emerging markets.
• 🔄 There is an overlap between the two funds, with both providing exposure to the S&P 500, which the speaker is comfortable with.
• 💡 The speaker prefers VO over VFV due to the U.S. dollar listing and exemption from 15% withholding tax on dividends within an RRSP.
• 🤔 The speaker emphasizes the importance of personal research and due diligence when choosing investment funds.
• 🕊 The switch to ETFs was motivated by a desire for simplicity, efficiency, and automation in the speaker's portfolio, especially considering their current life stage.
• 👨‍👧 The speaker's changing priorities, including family and career shifts, have influenced their decision to adopt a more passive investment strategy.
• 🧘 The passive approach offers peace of mind and reduced stress, as the speaker no longer needs to actively manage individual stocks.

Q & A

What significant change has the speaker made to their investment strategy?

The speaker has transitioned from owning individual stocks to an ETF portfolio.

What are the two ETFs the speaker has selected for their portfolio?

The two ETFs selected are VO, the Vanguard S&P 500 Index ETF, and ZQT, the Bimo All Equity ETF.

What is the primary reason for choosing VO over VFV, according to the speaker?

The speaker chose VO over VFV due to the exemption from the 15% withholding tax on dividends in an RSP account when holding US-listed ETFs.

What is the main advantage of the ZQT ETF according to the script?

The main advantage of the ZQT ETF is that it offers a predetermined asset allocation, providing exposure to various markets including the US, Canada, international, and emerging markets.

Why is the speaker okay with the overlap between VO and ZQT ETFs in their portfolio?

The speaker is okay with the overlap because it provides additional exposure to the Canadian and international markets, which aligns with their desired portfolio distribution.

What platform is the speaker using to track and share their investment activities?

The speaker is using Blossom, an app for investing in the stock market, to track and share their investment activities.

What is the speaker's rationale for accepting market returns instead of trying to outperform the market?

The speaker is at a life stage where they value simplicity, efficiency, and automation in their portfolio, and they are comfortable with the historical returns of the S&P 500.

What does the speaker mean by 'guaranteed returns' in the context of their investment strategy?

The speaker uses the term 'guaranteed returns' humorously to indicate that they expect their passive investment strategy to match the index return of the S&P 500, acknowledging that actual guarantees do not exist in the stock market.

What is the speaker's view on the time commitment required for managing an individual stock portfolio compared to an ETF portfolio?

The speaker believes that managing an individual stock portfolio requires more time and effort, including research and monitoring of earnings reports, whereas an ETF portfolio offers a more hands-off approach.

What life changes or priorities influenced the speaker's decision to switch to an ETF portfolio?

The speaker's decision was influenced by factors such as growing older, having family responsibilities, and a shift in career focus from finance to entrepreneurship.

What advice does the speaker give to DIY investors regarding portfolio management?

The speaker advises DIY investors to regularly self-reflect on their life phase, risk tolerance, and commitment to the stock market, and to choose a strategy that best suits their current situation.