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Investment Q&A

Not investment advice or solicitation to buy/sell securities. Do your own due diligence and/or consult an advisor.

Q: Can you suggest a few good ETF’s which should form the basis of one’s portfolio.

Also please suggest ETF’s for specific applications like..... high risk/ growth, dividend, US equities, Canadian equities, dividend stocks, tech stocks, emerging markets ..... and your choice of basket of ETF’s which a person could use to build a portfolio ( with % allocations)

Read Answer Asked by HARRY on May 10, 2021

Q: I'm currently trying to diversify my RIF account for 2021. I've trimmed some over weight holdings to free up some cash. I have NA covered with stocks in Canada and a couple of ETF's for the US but, nothing for the rest of world.
How would you currently rate the above now, hopefully for the coming recovery post COVID. I note, South America is not represented. do I need to consider it separately?
I'm inclined to go with 2 positions @ about 6% ......your opinion please!
All the best to you and everyone at 5i for the new year!

Read Answer Asked by Henry on January 04, 2021

Q: I have about 8 grand of my portfolio allocated for these 2 ETFS. Just wondering how you would weight them. For a 20 year hold. Maybe lean toward Japan as they are more allied with the US, but then again Japan is drowning under Debt.

XEF = Japan, UK, France, Switzerland, Germany,
XEC = China, Taiwan, Korea, Brazil, India

Read Answer Asked by Gordon on November 16, 2020

Q: HI, I just recently made the switch from mutual funds to ETF’s and a DIY strategy and am looking to lock down 4 low cost ETF’s that I will invest in for the long term (30 + years) and leaning more toward the aggressive side for these. I am looking to take advantage of some dollar cost averaging to enter the ETF market for some broad market index ETF’s in my TFSA and was looking for you opinion of some that I am trying to choose between.
Canadian Market – I am trying to choose between XIC, VCN & ZCN. They all have significant overlap and same MER so I don’t see a whole lot of difference between the three, although I am leaning towards XIU, thoughts on which one you would choose for your portfolio?
US Market – I am trying to decide between VUN & VFV. The VFV has lower MER than VUN and has outperformed VUN as of late. Smaller and mid-cap companies historically had higher volatility than the large-cap companies found in the S&P 500, and so the trade-off is potentially higher growth, for potentially more volatility if you go with a total market index like what is found in VUN. The S&P 500 has outperformed the total market index as of late so I guess the question is will this continue, I am leaning towards VFV, thoughts on which one you would choose for your portfolio?
International Developed – I am trying to decide between XEF & VIU, both have similar MER, thoughts on which one you would choose for your portfolio?
Emerging Markets – I am trying to decide between XEC & VEE for a small percentage of my portfolio, thoughts on which one you would choose for your portfolio?
These are some ETFs’ I have come across from doing build wealth Canada course and reading other materials and listening to podcasts that seem to fit my long-term outlook. I am by no means experienced in this matter and just looking to hit the ground running so If you have better suggestions for certain markets that I may have missed feel free to outline them.


Read Answer Asked by Sean on April 13, 2020

Q: I'm looking for tax-loss harvesting guidance with some ETFs. Can you provide alternatives to hold for XEF, XEC, and VUN that would likely be accepted by the CRA as non-wash? Thank you!

Read Answer Asked by Andrew on March 23, 2020

Q: Hello Team, thanks for providing a wonderful service! Would you have any recommendations for an Emerging Markets or Japan ETF?

Read Answer Asked by Jennifer on January 22, 2020

Q: Hi again,
Just wondering what you would think of using a few country specific ETFs for emerging markets exposure since China, South Korea, and Taiwan make up over 50% of XEC holdings. Too much risk vs diversity? Or just stick with something like XEC or EMGF for a 10+ year hold in a risk managed growth ETF portfolio. Thanks

Read Answer Asked by Daryl on December 19, 2019

Q: I have been investing in ETFs for several years, using a simple 5 ETF portfolio which includes VCN (27%), XUU (27%), XEF (19%), XEC(7%), and ZAB (20%). When I use the portfolio analytics, the suggested ETF portfolio includes about 15 ETFs. Just wondering what if the added complication of the additional funds is worth the effort. I assume that yours has better downside protection as it reduces some of the concentrated sectors and perhaps has better returns? My portfolio has grown in size over the past years so I am ok with the additional work to manage the portfolio, just wanted to better understand why.


Read Answer Asked by Everett on September 03, 2019

Q: Again another follow up on the XEC holdings.I have looked at three different financial websites. Yahoo, morningstar and TMX.
I cannot see anywhere that XEC holds IEMG as the US listed ETF.
Isn't this quite concerning as a DIY investor if one is trying to select ETF for account tax advantages? Why would we have to go to the prospectus to find out this information? Do you know of another site which might have this information?

Read Answer Asked by JEFF on August 16, 2019

Q: As a follow up to my last question re International ETF's, it looks like to me that XEC holds the international companies directly and ZEM holds 2 if not 3 US listed ETF's among some direct companies and thus would be less tax efficient, in a non registered account, as the US listed ETFs (holding the international names) would be subjected to two taxes.
I'm going by the chart put out by First asset that you referenced in a previous question on ETF Structure and tax implications.
Thanks again

Read Answer Asked by JEFF on August 15, 2019

Q: As a follow up to my question on July 30 re International ETF's.
I have quite a significant shift to perform. Reduce Canadian by 30% and increase International by 30% . You gave examples of international ETF's including XEF and ZDI. Did you purposely leave out China especially given the recent tone with the US or would XEC be a decent hold as well? Maybe 1/3 in each ETF?
Is this a good time to start the switch over or would you wait a bit to see where all the markets are heading? This would mainly be for non registered accounts and gather only one layer of withholding tax which is creditable.

Read Answer Asked by JEFF on August 15, 2019

Q: This is a follow up to my question about EM ETFs.

The way I see it, XEC holds only IEMG, but in Canadian funds. With XEC, there are 2 layers of foreign withholding taxes, one from the EM countries, and one from the US, neither of which are recoverable. This amounts to up to 27.75% (15% + 15% of the remaining 85%) withholding taxes on dividends, none of which are not recoverable.

With IEMG, the US withholding taxes are recoverable, so the total withholding taxes are up to 15%. That is a significant difference.

The same holds for VEE (holds only VWO).

ZEM looks like it holds about 15% US based ETFs, and the rest are direct holdings. That means that the withholding taxes are mostly recoverable (4.16% are non recoverable (from 15% of the holding times 27.75% from the above calculation), but the rest may be, depending on the treaties Canada has with each EM country).

Is this correct reasoning?

If it is correct, are there any other EM ETFs that have mostly direct holdings in addition to ZEM? Also, why would you recommend XEC over IEMG and VEE over VWO, especially considering the lower MER for IEMG and VWO?

If my reasoning is not correct, why, and which ETFs would be best from a taxation perspective?

Thanks, and I hope my question is clear,


Read Answer Asked by Federico on August 09, 2019

Q: I am wondering if any of the following do not hold all their international stocks directly (ie if they are an ETF of ETFs). I am pretty sure that XEF, IEFA, and IEMG do own all stocks directly, and I think VEE does not, but please correct me if I am wrong. I cannot seem to find information about the rest.


Thanks again,


Read Answer Asked by Federico on July 05, 2019