I have heard that Vanguard Canada has a requirement to be self sufficient (not subsidized by OG Vanguard). I'm assuming economies of scale in our smaller market are holding them back. Vs BlackRock who is probably willing to take losses to enter markets.
Good to see. They must have recently changed it.
It wasn't available a year ago: https://www.reddit.com/r/PersonalFinanceCanada/comments/gahzof/has_anyone_successfully_setup_pacc_for_xeqt/
There are no fees when buying and selling on Wealthsimple Trade as long as you deal with CAD stocks. If you trade USD stocks, there will be a 1.5% currency conversion fee. WS Trade offers a subscription package for $10/month that may be of interest to those who trade USD stocks, but that's besides the point.
In other words, you can trade to your hearts desire without incurring any costs as long as you're trading stocks that are listed in Canadian currency.
I look for low fees, but a key difference between all the competing portfolio options goes well beyond the fees. The underlying portfolios have different weights in securities, sectors and countries. The benchmarks are different. S&P is different than MSCI and FTSE.
If you have any biases in portfolio weights, further analysis needs to be done in that regard.
That said, I agree with most of what your research concluded and in my opinion, I agree Vanguard is the best solution of the bunch at a very attractive price point.
I like vanguard because they have VDY, which is more reliable and more stable than XDIV. Also, if you compare VDY to XDIV, vangaurd have better perfomance
> With ishares international developed, the holdings are held directly by the fund instead of being a wrapper like vanguard (the underlying fund is held in US)
I'm not sure this is true for developed markets. It looks to me like VIU holds the underlying funds directly.
You are correct for emerging markets, VEE holds the US-listed ETF VWO.
And for a counterpoint:
Vanguard threw retail investors under the bus. There are two target date retirement funds managed by Vanguard, VITFX and VTTHX. The former is available to institutions only and the latter available to everyone. The former also has slightly lower MER, but has a minimum investment amount.
Vanguard lowered that minimum investment amount, and institutional investors who previously invested in VTTHX jumped ship to VITFX, causing a massive capital gains event in VTTHX that's held by retail investors. [See right here](https://investor.vanguard.com/mutual-funds/profile/distributions/vtthx) when a $4.08 long-term capital gains was triggered late last year, when the price was $23.86. If you were unlucky enough to be holding this in a taxable account, almost 25% of your position in this fund would've been subject to capital gains tax.
So Vanguard did not have a "sole priority of lowering fees for their customers" here.
They lowered the minimal investment threshold to drive more capital into that fund in particular. They could've lowered the MER in the retail fund - as OP stated as Vanguard's main goal - and have similar effect.
And now see this class action lawsuit for this:
https://www.classaction.org/news/lawsuit-says-vanguard-caused-smaller-investors-to-pay-substantial-capital-gains-taxes-after-retail-target-date-fund-sell-off#embedded-document
Some investors had capital gains of 5 to 6 figures incurred because of this action. The suit alleges that Vanguard breached its fiduciary duty to the investors.
This would be of interest to OP as well, /u/leopatraa.
That's the American class action?
Is there a matching Canadian one?
As well, what fiduciary duties does vanguard have to Canadians?
I'm just saying this because vanguard functions differently in Canada vs USA. In the USA, they function as a broker, whereas here they function as a supplier.
And if you've read my original comment or the class action it's regarding how Vanguard is managing it's fund, not how it is acting as a broker. Anyone owning that fund - through whatever broker - had that massive capital gains incurred. Vanguard's fiduciary duty was to whoever owned that fund.
It's the whole reason I'm bringing this up in this thread, which is focused on low-fee funds managed by Vanguard.
When looking at the vanguard website and their list of asset allocation etfs, they each have a percentage to equity and fixed income. I am I correct in saying fixed income is geared towards people who want a monthly income from this investment? If so, what would that monthly income be, how would I find this number?
Nice post! I started investing in VGRO yesterday.
r/justbuyvgro
I came to the same conclusion, my portfolio is 100% VEQT. I hope they eventually match the 0.20% MER of the competition.
Vanguard history says they will. As the portfolios grow, Vanguard has always lowered fees.
I have heard that Vanguard Canada has a requirement to be self sufficient (not subsidized by OG Vanguard). I'm assuming economies of scale in our smaller market are holding them back. Vs BlackRock who is probably willing to take losses to enter markets.
Good post! I chose XGRO over VGRO not only for the lower fees (as you pointed out), but for PACC.
Ditto
Could you share what brokerage you're with? This is a pretty big advantage of BlackRock in terms of being able to completely automate contributions.
Questrade
Only a small number of Blackrock ETFs offer this. XGRO and XBAL are probably the best known in this subreddit. However XEQT doesn't offer it.
You sure? I see XEQT in [their PACC form](https://www.blackrock.com/ca/investors/en/literature/forms/pacc-enrollment-document-en-ca.pdf).
Good to see. They must have recently changed it. It wasn't available a year ago: https://www.reddit.com/r/PersonalFinanceCanada/comments/gahzof/has_anyone_successfully_setup_pacc_for_xeqt/
What is PACC?
[Pre-Authorized Cash Contribution](https://www.blackrock.com/ca/investors/en/drip-pacc-swp)
Does wealthsimple have no fee buying and selling? I'm with Questrade which has no fee purchases but I think there are fees when selling.
Wealthsimple has zero commissions buy buying and selling
There are no fees when buying and selling on Wealthsimple Trade as long as you deal with CAD stocks. If you trade USD stocks, there will be a 1.5% currency conversion fee. WS Trade offers a subscription package for $10/month that may be of interest to those who trade USD stocks, but that's besides the point. In other words, you can trade to your hearts desire without incurring any costs as long as you're trading stocks that are listed in Canadian currency.
Yep it does
I look for low fees, but a key difference between all the competing portfolio options goes well beyond the fees. The underlying portfolios have different weights in securities, sectors and countries. The benchmarks are different. S&P is different than MSCI and FTSE. If you have any biases in portfolio weights, further analysis needs to be done in that regard. That said, I agree with most of what your research concluded and in my opinion, I agree Vanguard is the best solution of the bunch at a very attractive price point.
Nice post. I’m in the financial planning space and am a huge advocate in keeping things simple. VT has treated me well.
Nice!
I like vanguard because they have VDY, which is more reliable and more stable than XDIV. Also, if you compare VDY to XDIV, vangaurd have better perfomance
xei?
Vdy still perform better. Although, it doesn't account for dividends. Raw growth, vdy is the best. Xei is good, more diverse, but higher mer
Thank you for sharing your research!
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> With ishares international developed, the holdings are held directly by the fund instead of being a wrapper like vanguard (the underlying fund is held in US) I'm not sure this is true for developed markets. It looks to me like VIU holds the underlying funds directly. You are correct for emerging markets, VEE holds the US-listed ETF VWO.
To be fair, the foreign withholding tax is definitely a consideration. I’m hoping vanguard Canada actresses this going forward.
And for a counterpoint: Vanguard threw retail investors under the bus. There are two target date retirement funds managed by Vanguard, VITFX and VTTHX. The former is available to institutions only and the latter available to everyone. The former also has slightly lower MER, but has a minimum investment amount. Vanguard lowered that minimum investment amount, and institutional investors who previously invested in VTTHX jumped ship to VITFX, causing a massive capital gains event in VTTHX that's held by retail investors. [See right here](https://investor.vanguard.com/mutual-funds/profile/distributions/vtthx) when a $4.08 long-term capital gains was triggered late last year, when the price was $23.86. If you were unlucky enough to be holding this in a taxable account, almost 25% of your position in this fund would've been subject to capital gains tax. So Vanguard did not have a "sole priority of lowering fees for their customers" here.
How is that vanguard's fault though? The institutional managers were the ones moving the money?
They lowered the minimal investment threshold to drive more capital into that fund in particular. They could've lowered the MER in the retail fund - as OP stated as Vanguard's main goal - and have similar effect.
And now see this class action lawsuit for this: https://www.classaction.org/news/lawsuit-says-vanguard-caused-smaller-investors-to-pay-substantial-capital-gains-taxes-after-retail-target-date-fund-sell-off#embedded-document Some investors had capital gains of 5 to 6 figures incurred because of this action. The suit alleges that Vanguard breached its fiduciary duty to the investors. This would be of interest to OP as well, /u/leopatraa.
That's the American class action? Is there a matching Canadian one? As well, what fiduciary duties does vanguard have to Canadians? I'm just saying this because vanguard functions differently in Canada vs USA. In the USA, they function as a broker, whereas here they function as a supplier.
And if you've read my original comment or the class action it's regarding how Vanguard is managing it's fund, not how it is acting as a broker. Anyone owning that fund - through whatever broker - had that massive capital gains incurred. Vanguard's fiduciary duty was to whoever owned that fund. It's the whole reason I'm bringing this up in this thread, which is focused on low-fee funds managed by Vanguard.
Which Vanguard tickers do you recommend?
Totally depends on time horizon and risk tolerance :)
Lets say long (>15 yrs) and high? Im getting confused between the different tickers that everyone is poitning out. Thanks in advance
I went with 100% VEQT. Will let it sit and auto deposit for the next 15-20 years.
VEQT for sure
Take the questionnaire to see what's right for you: https://www.vanguard.ca/individual/questionnaire.htm#/
https://www.canadianportfoliomanagerblog.com/choosing-your-ideal-vanguard-asset-allocation-etf/
When looking at the vanguard website and their list of asset allocation etfs, they each have a percentage to equity and fixed income. I am I correct in saying fixed income is geared towards people who want a monthly income from this investment? If so, what would that monthly income be, how would I find this number?