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Read through this whole thread, learned a lot, huge thanks to everyone posting in it. Both to the knowledgable folk who are sharing and to the newbies for asking my dumb questions for me. Someone linked some Vanguard Canada portfolio strategies a few pages back and I can almost see the eye roll accompanying this bit of copy: quote:Canadian investors have historically demonstrated a significant home bias when investing in stocks and bonds. I'm trying to decide on a portfolio allocation and I'm curious about how y'all decided on how many index funds to buy. The simplicity of index funds compared to a manually diversified portfolio is a big part of what brought me on board. That simplicity could extend all the way down to holding just two funds (one bonds, one equity), or even one (if you're all equity). But it seems like a lot of people end up holding four or more. Why? (It wouldn't surprise me to learn that it doesn't much matter, assuming you stick to an allocation and diligently rebalance, but I'm curious nonetheless.)
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Jun 25, 2016 23:41
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You pick one allocation and always aim for that. Within reason, which allocation you choose is less important than regularly rebalancing towards it. The point is to mechanically buy low and sell high. I'm not an expert though so it's very possible I'm missing something.
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Sep 10, 2016 01:47
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Rereading some stuff, I guess the true reason to rebalance is to maintain your allocation for the reason you chose that allocation in the first place. http://canadiancouchpotato.com/2011/02/22/why-rebalance-your-portfolio/ explains my mistake and the obvious (in retrospect) counterexample.
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Sep 10, 2016 03:30
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Rick Rickshaw posted:On that note, why is it "annual" rebalancing? Rebalancing in Questrade is fairly cheap, so why not more often? If there's a big dip in the market I'm sure as hell going to rebalance before my due date. Shouldn't there be a rule of thumb, like a percentage of imbalance calls for an ad-hoc rebalance? The reasoning I've seen for annual is: • Keeps your portfolio out of mind in the meantime, reducing chances of you losing your nerve. • Lower expenses by making fewer trades (even cheap trades). • Any less often and you'll forget. (I think Four Pillars said every two years was ideal, but annual is easier to do right.) Here's a good post in favour of threshold-triggered rebalancing. Keep in mind that the author of that post is allocated 100% stocks, maybe that changes the argument somehow?
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Sep 10, 2016 13:22
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cowofwar posted:Tangerine
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Oct 11, 2016 23:19
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My local library had it. If yours doesn't, call 'em and ask, they'll surely interlibrary loan that poo poo for you.
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Nov 2, 2016 00:00
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This looks like a handy blog/video series for those (like me six months ago) who are completely new to diy investing: How to Build an ETF Portfolio at [discount brokerage]
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Nov 4, 2016 23:02
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Landsknecht posted:what's going to happen to my etf portfolio if the US markets take a massive dive on nov 9th because of election results You'll buy more.
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Nov 4, 2016 23:44
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Jan posted:the very slight interest gain from investing right away instead of reinvesting a post-RRSP tax return Look into filing a T1213 so you get the deduction on each paycheque. Here's a blog post about it. I believe a screenshot of an automatic monthly (or whatever) deposit is also acceptable to CRA. That post is a few years old now, and I haven't yet done it myself, but last year a couple of coworkers did it no problem.
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Jan 14, 2017 01:41
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Count Roland posted:I first heard of Questrade over the weekend, now I pop into this thread and you guys are recommending it. Have you read the OP? I get the impression that you're unsure about what you're doing. I read every dang post in this thread before starting out and it is totally worth it. Take a month and work through it on the bus ride home. You will find your question, and many more, answered within! (Sorry if I'm making a bad assumption here and sounding like a dick.)
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Jan 16, 2017 23:57
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The e-Series funds (and the non-brokerage TD mutual funds account) seem to exist in some weird, forgotten department of the company. They're in the office in the back corner and nobody out front seems to quite remember what they do in there, but with a little work and luck you can find out and make good use. I think there's maybe a phone number somewhere to talk to a "mutual fund specialist" and they might be more helpful/knowledgeable than your typical branch employee? Anyway there's no shortage of odd tales online about trying to actually set it all up, so it's not super surprising to hear that you're struggling a bit. It's probably most straightforward to do it through a standard TD Waterhouse brokerage account, but that's understandably intimidating when you're just starting out.
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Jan 21, 2017 21:33
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Skizzzer posted:I just want to confirm that I'm doing this e-series thing correctly: I'm fairly sure you can do automatic deposit directly into your four e-Series funds. This doesn't remove the need to rebalance every year or two! Unless each fund has moved in exactly the same way over the 1-2 year period, you'll be out of balance even if you stoically shovelled money in at the same ratio the whole time. The way you're doing it now seems ok, but I think you can eliminate the middleman balanced growth fund and make things just a little bit simpler (and slightly cheaper). If you truly want automatic rebalancing (and it's ok if you do!), maybe have a look at a robo-advisor or a single fund approach. They're a bit more expensive than manually rebalancing four e-Series funds (think 0.5% versus 0.8% versus 1.1%), but if a couple basis points is the difference between you staying in the market vs. bailing, it's worth it. Mantle posted:If you rebalance more frequently, you're not giving your performing asset classes room to run. I think the main argument against more frequent rebalancing is that it costs too much in commissions. Suppose you can make trades for $0. If index A goes up every day for a year while index B goes down, who cares if you sell A to buy B once a day, once a week, once a month, or at the end of the year? You should end up in the same place. cowofwar posted:I just top up to my targets rather than rebalance. Me too, but I admit that's a bit more work than automatic deposit and one annual rebalance. Also I imagine it'll stop working when my portfolio grows.
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Jan 24, 2017 02:27
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Skizzzer posted:Thank you, this is what I'm hoping to do. It just seemed like my current process could be streamlined a bit. Let me know how it goes! I'm adjacent to a very similar setup so I'm curious how easy it is to manage.
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Jan 25, 2017 00:07
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grack posted:What? Oh holy gently caress no. 1-2 years is way too often to be re-balancing a portfolio unless you experience a serious life-changing event (marriage, kids, buy house, retirement). Re-balancing should be done according to your expected time horizon. Your actual portfolio distribution matters a shitload less than the returns you expect, and trying to re-balance too often will really screw that up. When I say rebalancing, I'm talking about selling what's gone above your target allocation and buying what's below. Am I using the wrong term?
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Jan 25, 2017 21:52
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Zettace posted:These are ETFs right? Why would these be better? Mutual funds are ok too, if they're cheap (TD e-Series).
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Feb 7, 2017 22:30
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That's broadly it, yep.
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Feb 10, 2017 16:02
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Lazyhound posted:Dumb basic question: is there any reason (e.g. fees) to not switch my payroll deposit and recurring bills to my savings account, and then transfer out my budgeted spending money to my chequing account? I don't know if you suffer from the same confusion that I once did, so this may be an insulting explanation, but: I had a bank account for ages until I realized that the difference between "chequing" and "savings" accounts is pretty arbitrary and depends on the institution and other things. For example, I assumed I couldn't get cheques printed for my CIBC savings account because there's this other thing called a chequing account and surely that's where cheques have to come from? I was wrong. Tangerine actually has a little web page in their settings where you can specify which account gets hit when you press the CHQ or SAV button on a point-of-sale machine. It's completely arbitrary at that point. But I can't pay my bills directly from the savings account for whatever reason. Whatever. If you share what institution and what account types are involved then someone might have more specific advice.
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Feb 28, 2017 19:59
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1500quidporsche posted:Dumb RRSP question: I'd look at http://canadiancouchpotato.com/model-portfolios-2/ and see what sounds good for you. Foodship9 posted:Can someone explain to me why the TD e-funds are so much better than the high-MER alternatives from the banks and financial advisors? The general argument behind indexing is that whatever portfolio you end up with will, at best, equal market returns in the long term (decades). Given that, your best hope is to invest broadly in the market (lower volatility) at the cheapest possible cost (e-Series, among TD funds). And a percentage point here and there does matter. There's many explanations and clumsy metaphors to explain why, but I found this post particularly compelling. (Hopefully someone will drive by shortly and correct all the glaring errors I've inadvertently dumped here. I'm still new at this.)
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Mar 6, 2017 23:29
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The Kestrel posted:Yes, well, this would be a yearly investment of $2500 + $500 grant. How much are the fees for purchasing etfs? Can you get a discount for making preauthorized purchases, or is just a flat rate? I think TD is $10 per trade. If you're contributing annually to a typical couch potato portfolio that's $40 per year. Compare commission plus lower management fee versus no commission and slightly higher management fee and you have your answer. Honestly the bigger danger here is analysis paralysis as you try to minmax a couple dollars. You'll do well with either approach you've outlined. If you need some random internet poster to break the tie, I say go e-Series with automatic contributions and forget about it until you rebalance in a couple years.
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Mar 19, 2017 16:42
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Some percentage, min $5, max $10. In my head I just assume it'll be $10.
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Mar 25, 2017 19:17
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spoof posted:Be careful with that assumption. They pass on ECN and other fees to you so it can end up quite a bit more. Good point! I guess I shouldn't say there's a maximum charge for executing a sell order.
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Mar 25, 2017 22:05
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I've been reading about the Home Buyer's Plan and I'm confused. I can't figure out when it would ever be a good idea. Before I continue: I'm not looking to buy a house; I suspect it's generally bad policy; there's surely many ways to use it very poorly. I'm just running hypotheticals. Given all that, is there a scenario where it's effective? Here's the only case I've come up with: 1. You have RRSP contribution room that you would not otherwise use for your (regular, adequate) retirement savings in the next decade. (Maybe TFSA room suits your needs? idk) 2. You have enough for a down payment saved up (not already in the RRSP). 3. So you put your down payment in an RRSP so you can claim the deduction, then HBP it out in three months. 4. Buy that house. 5. You take your refund and... throw it at the mortgage? Seems like a few hoops to bump up your down payment by a couple thousand. And I still can't convince myself that this is somehow better in the long run.
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Apr 6, 2017 03:48
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Alright, well I feel like I'm not missing much then. I hadn't thought of getting over the 20% mark or of employee match but they're in the same boat I think? The money would do better in the market over the long term.Subjunctive posted:HBP also predates TFSA I believe. By fifteen years, apparently. So that makes a little more sense as a policy decision at the time.
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Apr 7, 2017 02:08
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Cold on a Cob posted:It's worth running the numbers to decide what to do. Absolutely. Would be silly not to, if I was anywhere near planning to home-buy.
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Apr 7, 2017 02:30
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Good job thread! 
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Apr 12, 2017 03:41
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edit: ^^^^ Run it through simpletax just for fun, see if it gets it right. It's free. Femtosecond posted:Is there any consensus on what is the best investing strategy once one has maxed out their RRSP/TFSA? Pretty sure "housing" was a joke answer. I think the usual guidance is to continue as you were. The two wrinkles I can think of once you leave tax sheltered accounts are: • Some investments are more favourably taxed than others, so it can make sense to shuffle which accounts hold what while maintaining your overall asset allocation. Sounds like you're already thinking about this. In practice this basically translates into "hold your bonds in a sheltered account". • There's some potentially annoying bookkeeping you have to do to track the adjusted cost base so you can correctly report capital gains. Here's a Canadian Couch Potato post about it. You might be able to avoid this for awhile by using regular contributions to rebalance, e.g. like this, because it only comes into play when you sell something. I'm pretty new at this and have never actually done anything with a taxable account so it's still theoretical for me. I'm sure someone will pipe up if I got something wrong here. pokeyman fucked around with this message at 14:38 on Apr 16, 2017 |
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Apr 16, 2017 14:36
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Bucswabe posted:One question though: I understand that Questrade lets you purchase ETFs for free, but i cant find any information on commission fees when you sell. Can anyone tell me how that works? Questrade can tell you how that works! It's just a standard "stocks" trade.
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May 7, 2017 01:31
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mr.belowaverage posted:I'm super confused by this. Can someone opine on whether I'm doing my savings totally wrong for my situation. They're talking about minmaxing your remaining tax shelter room once you've filled up your TFSA and presumably have the means to quickly fill up your RRSP once you bump up to a higher tax bracket. That doubly doesn't describe you, so I don't think you're missing anything there. I found this post very helpful for understanding what's going on with these two different tax shelters. Maybe you'll find it helpful too? As an aside, while you are Doing It Right by putting your tax refund right back into your RRSP, I'm a little suspicious of you borrowing your tax return on your LoC to squeeze a few more dollar-months into your RRSP. You can simply get your refund back on each paycheque instead by filling out a T1213. Remember that compounding works its magic on the scale of decades, not months.
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May 9, 2017 02:51
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If you're not paying interest then yeah, go for it. I'm kinda paranoid about stuff like that, like I assume I'll mess it up and do something a day late and blah blah. Sounds like you've got it covered.
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May 10, 2017 04:25
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yippee cahier posted:Good advice. Opening an account at Questrade and using it isn't difficult to do. I think the recommendation to use Tangerine for smaller portfolios mostly to get you started saving right away instead of having you give up on all this investing stuff when you have to pick which ETFs you want to buy and everyone online has a different advice on weighting, etc. Questrade is not difficult but it sure can be intimidating. There's a ton of knobs you can turn and the worry that you've somehow hosed it up can take ages to dissipate. Nobody reading this thread is doing something stupid by investing in Tangerine funds or a vaguely balanced e-Series allocation. Just know there are further efficiencies available if and when you want to eke out some more dollars with a little more work.
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May 16, 2017 00:31
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Every Scotiabank ATM is also a Tangerine ATM, if that helps.
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Jun 11, 2017 22:40
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Tangerine MasterCard just went down to 0.5% back on purchases outside your two or three chosen categories, so you can probably do better than that.
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Jul 26, 2017 23:50
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cowofwar posted:You split up transactions instead of just spending the three extra seconds to use the chip? Or forgot their PIN.
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Aug 7, 2017 02:04
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http://www.moneysense.ca/save/investing/canadas-best-online-brokerages-2017/ is probably a good start.
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Aug 7, 2017 19:12
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Lexicon posted:I use InvestorLine because I trade pretty infrequently and $10 a throw is worth it for the knowledge that the thing will actually exist in 5 years time, and so I’ll be spared the headache of paperwork etc when an inevitable acquisition or bankruptcy occurs. Be sure to post when it’s the fifth anniversary of your making this choice 
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Aug 8, 2017 02:52
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Lexicon posted:Ok, for sufficiently large N I don’t really expect to be at the same brokerage for an entire 40+ years of saving and investing, but I do see the logic of avoiding "the old brokerage won't exist next week" as a reason for switching. Out of curiosity, what would make you switch?
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Aug 8, 2017 04:56
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Wirth1000 posted:Probably a silly question but for cashback credit cards does the cashback ding right away with any transactions? Or do you have to actually maintain that purchase balance past the grace period before the cashback kicks in so they manage to ding you for interest before counting towards the cashback? As another data point, the Tangerine card pays monthly. But yeah as has been said, there’s no need to carry a balance in order to get the cash back.
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Aug 10, 2017 02:31
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They absolutely will change things. With any luck they'll be slow about it, but now you gotta be even more vigilant.
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Aug 16, 2017 20:08
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A colleague made a good point re: rip PC Financial: look for some bonus cash to open a new account in the near future so they can juke the stats.Subjunctive posted:The only reason they bought PCF is for the customers, so I don't expect them to gently caress with it too badly in the near term. I wonder why Loblaws sold. Not even Canadians were interested in their grocery checkout clerk selling them a mortgage? Jordan7hm posted:The worst change for me is losing the PC kiosks in Loblaws. I could already use CIBC machines, so now the number of free ATMs just gets cut in half. Sucks from a convenience perspective. That blows. Tangerine went the opposite way after getting bought, expanding from weirdo ATMs at credit unions to anything Scotiabank. In general the lesson is to have no loyalty whatsoever to banks. Always be ready to switch.
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Aug 17, 2017 02:45
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I think the answer there is commission. With a portfolio under that size, whatever you gain with a lower MER is outdone by paying  per trade.If you don't pay commission to buy the ETF shares then it's moot. edit: this assumes regular contributions to build up the portfolio. If you're dumping $30k in one go then one commission fee won't wreck you.
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Sep 24, 2017 21:07
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