usa and global exposure

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my current portfolio is light on global and US exposure. to gain some in the future as things start to shake out in the markets i am looking for ETF’sĀ  focusing tech, consumer defence/cyclical, basic materials and industrial, something that is well diversified through all sectors would be fine as well. what would be your top handful of picks for global and US exposure?

thanks

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Asked on April 17, 2020 10:37 am
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Hey there. So, I did some digging this weekend and found what I thought I would find. In my opinion, XUU is the best. With over 3450 holdings, it is by far the most diversified. Keep in mind, XUU will charge you a withholding tax regardless if its held in an RRSP (which are usually exempt from the taxes.) So, the MER of 0.08 is misleading, although even with the taxes it works out to be very little.

However, there are a few other options if you're looking to venture elsewhere. Vanguards version of the S&P ETF is VFV, which essentially just holds the US listed ETF VOO.

VFV yields 2.24% while XUU yields around 1.96%.

Aside from dividends though, XUU has outperformed VFV over the last 5 years. XUU's 5 year return of 7.64% is marginally ahead of VFV's 6.70%. Management fees from both ETFs are practically negligible, but like said above you will pay withholding taxes on both.

If you'd like VFV's version of a currency hedged ETF, VSP is the alternative. Now, the Canadian dollar has been hammered as of late due to COVID. A hedged ETF would protect you from a quick recovery.

I hope this helped.

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Posted by Dan Kent
Answered on April 19, 2020 1:28 pm
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Awesome! I'll have a look. I should be able to get back to you this weekend.

If you'd like a quick look at one to mull over before I get back to you with more options, XUU.TO is a great Canadian ETF that tracks US stocks. The MER does look low, however it'll cost you a bit more because there is withholding taxes, even in an RRSP.

I'll be back with more options.

Cheers

Dan

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Posted by Dan Kent
Answered on April 17, 2020 4:53 pm
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They there. Great question.

Before I answer it, just let me know if you're looking for US ETFs, or Canadian ETFs that hold US stocks/ETFs.

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Posted by Dan Kent
Answered on April 17, 2020 11:29 am