Investment Q&A

Q: Hi Team,
Is there a ETF similar to VGRO but sold in $US without converting to Cdn? I have some cash on the US side of my RRSP and like the set up of VGRO but would rather not convert back to Cdn at this point.

Q: The rise in stock prices of a few mega-caps (Apple, Facebook, Amazon, etc.) has distorted the concept of broad diversification through index investing (S&P 500). While the index rises, many index constituents have performed poorly.

Some ETF providers have created funds that hold a subset of the components of existing indices. Inclusion is based on their concept of company "quality". Presumably this eliminates poor performers and results in a "better" fund.
Examples are: ZUQ, SPHQ, QUAL, ZGQ, ZEQ.

Please comment on this idea of "quality" subsets of existing indexes. Do you consider this to be a useful investing strategy? Would you consider the examples listed to be preferable investments compared to the broader indices?

Thank you.
IslandJohn

Q: I have a TFSA with about $33K that I plan to give to my daughter for graduate school in about 2 years. ZWU looks like a good investment, with YTD return of -14.25% and yield of about 7.95%. Would appreciate your comments on ZWU and any other suggestions you could provide.
Thanks!

Q: One is an ETF while the other used covered calls to enhance dividends. Can you tell me what real difference there is between them aside from the 5% vs 10%+ div. I was thinking of buying XDIV but several of its holdings are the same as DFN which I own. Any point in also owning XDIV?
Thanks very much.

Q: Please, your views on rth-q. VanEck Vectors Retail ETF ? What would you rather buy now in consumer cyclicals ?

Gratefully,

Jacques IDS

Q: Good morning 5i staff
I have been waiting for the turn towards esg etf's. Looking at something like ESGV, do you think it could be seen, say, as an equivalent to voo? there was an artcle in Barron's recently saying that they recently have done as well, or better than regular funds. I believe the managment excpense ratio is .12 Not bad. I hold VOO and have been thinking of selling call options on it and then buying something like esgv, if I am called away. I suppose that approach could not be called radically green maybe more like patiently green:).
thanks

Q: I always avoided HXS because I thought it didn't hold stocks and just had an agreement with NA to deliver the total returns equivalent to S&P500 so there was a significant counterparty risk. The risk may not be much but didn't want to tolerate this risk just to avoid 15% Dividend Tax Withholding. Recently I got to know that HXS has changed its structure from Total Returns Swap to Corporate Class. Does it mean that it now holds stocks (like ZSP or SPY) .. is HXS still any more risky than ZSP or SPY.

Q: I would like to invest into the future health care in North America. What do you think of LIFE ETF?

Q: I have some US GIC's that have matured and my advisor at RBC is recommending the RBC US Short-term Corporate Bond Fund as interest rates have declined so much for GIC's.
Would you consider this to be a good move or is there something else I should be considering.

Q: Considering a new investment in the technology sector in a TFSA account, would the semiconductor space be investable now and would your preference be to one or two specific companies or an ETF such as SMH or SOXX. Your comments and ideas always appreciated. Brian

Q: If you were to establish an RESP for someone who was just born, and are starting with a small amount of money, perhaps a couple of thousand dollars, what would you invest in? Would you invest in an ETF? If so, which one? Would you consider investing in a single stock? If so, which ones would you consider?

Q: Hi, may I know which one is better to hold in TFSA ? Thank you

Q: Hello 5i Team
I am comparing two ETF from Vanguard Canada and from Vanguard USA.
Vanguard Canada – US Total Market ETF (CA:VUN), trades in Canadian dollars on Canadian exchange, tracks the CRSP US Total Market Index. The MER is equal to 0.16 %. The 2019 distribution was composed of $0.99538 foreign income, $0.00076 ROC and $0.1593 foreign withholding tax (approximately 16 % of the total distribution, applied by Vanguard).
Vanguard USA – Total Stock Market ETF (US:VTI), trades in US dollar on US exchange, tracks the CRSP US Total Market Index. The MER is equal to 0.03 %. The 2019 distribution was US$2.8747 with no withholding tax applied by Vanguard.
Questions are:
1 – Are these two ETF essentially the same (one trades in C$ on Canadian Market, the other trades in US$ on the US Market) as they both appear to track the CRSP US Total Market Index?
2 – If I hold CA:VUN in a non-registered account, will there be withholding tax applied by my broker to the distribution?
3 – If I hold US:VTI in a non-registered account, will there be withholding tax applied by my broker to the distribution?
4 – Is the difference in the MER (0.16 % vs 0.03 %) essentially the 15 % withholding tax applied to US dividends?
5 – Which is the better ETF to hold in a non-registered account, ignoring the cost of currency conversion to purchase US dollars in order to buy US:VTI?
Thank you

Q: I have parked cash on PSA, I was wondering, if a better choice is to place it in one of IWO , VYMI, XBAL; the goal is to leave it there for a few years, and to help growth the account.
Thanks

Q: Retired dividend-income investor. I hold CDZ for the long term and currently have a 75% position, topping up regularly to achieve a full position by year end. When originally purchased the yield was in the range of 5.4%, now it is 3.7% due to some of the constituent dividends being suspended. I believe CDZ is reconstituted annually. When this happens, what will happen with the dividend? With the potential changes to the underlying securities, will the CDZ methodology cause the dividend to increase somewhat?

I am "ok" with the current dividend. I am just wondering if I will get a bit of a bonus when the ETF is reconstituted?

Thanks for your help...Steve

Q: Hi,
Thank you for your straight forward answer to Paul's question to-day. (September 01) I presume that even though you mentioned XBAL as your pick, you wouldn't mind including VBAL/ZBAL in that space. Very similar aren't they?
IF one wants to augment this, to get steady stream of dividend income, should one add higher dividend paying ETFs like DGRC or VDY or XDV etc., More to keen to know your thoughts about enhanced indexing. How should one go about it?
Thanks.

Q: Would you comment on the potential of the America ETF IZRL, which invests in Israeli technology companies, in light of the possible normalization of relations between Saudi Arabia and Israeli and therefore the flow of investment funds into Israel?

Q: Between these 2 ETF which one would you say is a better hold moving fowarde.

Q: Currently hold positions in both these ETF's for U.S. exposure in a RRIF account.
Considering replacing ZUD with either VGG or RUD.
Any comments or other suggestions would be appreciated. Brian

Q: Theses ETFs nd many more trade on the TSX in CDN$ but are they currency hedged or not? I understand currency hedging but how can a foreign based ETF trade in Canada without hedging? Thanks Ron