Q: Hey 5i, I would like your suggestions on portfolio construction for a retired individual. Basically I would like your suggestions for percentage breakdown between Canada, US, and international. My plans for international is just buying VXUS and calling it a day. For Canada I’m buying ETFs XDIV and CDZ. For the US I’m going to buy the 11 sectors (including REITS) through ETFs, either Vanguards or ishares. So I would like your suggestions on percentages put to the 11 sectors in the US for a retired individual. Thanks so much and what a great service you have!
5i Research Answer:
Keep in mind sector allocations need to be personal but we will give general guidelines for a conservative investor. We are comfortable with all of the ETFs noted in the question. We might consider VIUover VXUS as VIU is ex North America. VXUS does have some (7.4%) Canada exposure so there is a bit of overlap if one owns Canadian ETFs as well.
We would suggest: 35% Canada, 45% US, 20% international.
Sectors: Real estate 5%, Utilities 15%, Consumer staples 15%, Financials 10%, Tech 15% (less if ultra conservative), Industrial 10%, Health 10%, Energy 5%, Communications 10%, Consumer discretionary 5%