Do you still think XEQT is better than VEQT? I'm from Canada amd just starting out. I ended up buying TLT based on your informative new video about it. Maybe i can wait for a dip on xeqt?
VFV is a great S&P 500 index fund. There is some overlap between this ETF and an all-in-one ETF. For example the top 2 holdings for both VFV and XEQT are Apple and Microsoft. XEQT is already 50% in U.S. stocks. I wouldn't hold both VFV and XEQT unless I was super bullish on the United States economy compared to other countries. VDY focuses on Canadian stocks with relatively high dividend payments. It's a sensible way to earn around 4% a year from cash dividends. And it does not overlap too much with an all-in-one ETF. So holding both VDY and XEQT at the same time is not a bad idea, depending on your investment goals. Just be aware that you'll be receiving more income, but less capital appreciation than a more growth oriented strategy. If the contribution rooms for your TFSA and RRSP are both maxed out, VDY is a very tax efficient ETF to hold in a non-registered account thanks to the eligible dividends tax credit. :)
Great question. The distributions will mostly be in the forms of dividends, and foreign income. Some dividends will be eligible for the tax credit, while foreign income is 100% taxable. There is also a foreign withholding tax component, which will create a 0.24% annual drag on the portfolio. 🙂 For tax preparation investors who hold these funds in a non-registered account will receive a T3. This tax slip will break down all the different types of distributions. To simplify things these all-in-one ETF portfolio solutions are best held inside a tax sheltered account such as the TFSA or RRSP.
Due to the current low interest rate environment I wouldn't recommend bonds at the moment unless you understand all the risks that comes with that asset class. From 1950 to 1980 long term bonds lost 50% of their value in real terms.
I suppose that depends on whether you think the U.S. market will outperform the rest of the world. :) I feel like it's a coin toss at this point. If I don't have any particular reason to believe the S&P 500 will outperform, then I will go with VEQT. Diversification is a useful strategy when you don't have a lot of information. On the other hand, if you believe U.S. large caps will continue to do well, then VFV is the better option.
That's interesting. I didn't know they've been around for 5 years. I thought both funds were started a couple of years ago in 2019. VEQT is more heavily weighed in Canadian stocks. The slight outperformance by VEQT over the 12 months can be explained by the Canadian stock market doing better than the US market. But I'm curious how both will perform over longer periods of time. If you don't mind sharing your source I'd be happy to take another look.🙂
@@Freedomthirtyfiveblog Hey! Yes you are correct. Sorry. They started in 2019. VEQT has outperformed by about 7%. Must be financials doing well in Canada and so forth. I think XEQT will probably be better in the longer term. Both great buys. I wonder if these will outperform the general S&P 500 as they appear to be more diversified but also have growth attached.... !
@@mjregan88 double check if inception dates are similar for both ETFs. If you are comparing an ETF been around 1.5 years vs another ETF been around 2 years, obviously we aren't comparing apples to apples.
Global active ETFs like HAZ or XWD coupled with emerging market ETF are a much better option. Market allocations of XEQT and VEQT are too static, not adjusting well enough as the market caps change, also don’t pay too much attention to MERs it could be misleading. At the end of the day what matters is how much money you end up with.
Great video! Concise and clear. Subbed!
Awesome, thank you!
nice video...you did a great job comparing these 🙌
Thank you for watching. I appreciate the kind words. 🙌
Do you still think XEQT is better than VEQT? I'm from Canada amd just starting out. I ended up buying TLT based on your informative new video about it. Maybe i can wait for a dip on xeqt?
Would it be wise to hold this etf with VFV and VDY? Or will they be too overlapping?
VFV is a great S&P 500 index fund. There is some overlap between this ETF and an all-in-one ETF. For example the top 2 holdings for both VFV and XEQT are Apple and Microsoft. XEQT is already 50% in U.S. stocks. I wouldn't hold both VFV and XEQT unless I was super bullish on the United States economy compared to other countries.
VDY focuses on Canadian stocks with relatively high dividend payments. It's a sensible way to earn around 4% a year from cash dividends. And it does not overlap too much with an all-in-one ETF. So holding both VDY and XEQT at the same time is not a bad idea, depending on your investment goals. Just be aware that you'll be receiving more income, but less capital appreciation than a more growth oriented strategy.
If the contribution rooms for your TFSA and RRSP are both maxed out, VDY is a very tax efficient ETF to hold in a non-registered account thanks to the eligible dividends tax credit. :)
I combine XEQT with TEC. 80/20 allocation
VDY would be too overlapping imo
@@manasbansal7946 does TEC not overlap with XEQT?
Perfectly explained!
Thanks for watching. :)
How are the distributions/dividends taxed? interest or capital gains? Thanks so much. Good video.
Great question. The distributions will mostly be in the forms of dividends, and foreign income. Some dividends will be eligible for the tax credit, while foreign income is 100% taxable. There is also a foreign withholding tax component, which will create a 0.24% annual drag on the portfolio. 🙂
For tax preparation investors who hold these funds in a non-registered account will receive a T3. This tax slip will break down all the different types of distributions.
To simplify things these all-in-one ETF portfolio solutions are best held inside a tax sheltered account such as the TFSA or RRSP.
What about etfs that hold bonds?
Due to the current low interest rate environment I wouldn't recommend bonds at the moment unless you understand all the risks that comes with that asset class. From 1950 to 1980 long term bonds lost 50% of their value in real terms.
LOL, 5:50 is a chart for CAKE/USDT.
Haha, good eye. :)
Better strategy given a long term horizon: VEQT or VFV
I suppose that depends on whether you think the U.S. market will outperform the rest of the world. :)
I feel like it's a coin toss at this point. If I don't have any particular reason to believe the S&P 500 will outperform, then I will go with VEQT. Diversification is a useful strategy when you don't have a lot of information. On the other hand, if you believe U.S. large caps will continue to do well, then VFV is the better option.
I am holding xeqt and ishares than vanguard. Cheaper and got more shares..
Makes sense to me. I like XEQT as well. 🙂
VEQT has outperformed XEQT for 5 years straight (actually since its history) so....
That's interesting. I didn't know they've been around for 5 years. I thought both funds were started a couple of years ago in 2019.
VEQT is more heavily weighed in Canadian stocks. The slight outperformance by VEQT over the 12 months can be explained by the Canadian stock market doing better than the US market. But I'm curious how both will perform over longer periods of time. If you don't mind sharing your source I'd be happy to take another look.🙂
@@Freedomthirtyfiveblog Hey! Yes you are correct. Sorry. They started in 2019. VEQT has outperformed by about 7%. Must be financials doing well in Canada and so forth. I think XEQT will probably be better in the longer term. Both great buys. I wonder if these will outperform the general S&P 500 as they appear to be more diversified but also have growth attached.... !
@@mjregan88 double check if inception dates are similar for both ETFs. If you are comparing an ETF been around 1.5 years vs another ETF been around 2 years, obviously we aren't comparing apples to apples.
What fool would design or buy a fund with over 20% in Canada?
Global active ETFs like HAZ or XWD coupled with emerging market ETF are a much better option. Market allocations of XEQT and VEQT are too static, not adjusting well enough as the market caps change, also don’t pay too much attention to MERs it could be misleading. At the end of the day what matters is how much money you end up with.