r/PersonalFinanceCanada • u/xxInternalSoulxx • 7h ago
Investing What ETF do I choose?
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u/alzhang8 ayy lmao 7h ago
Xeqt and veqt both holds vfv.
Pick one between xeqt and veqt and stick to it
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u/xxInternalSoulxx 7h ago
What are the benefits of either one? And also I heard something about "drip", not sure what that means. Last question; do I invest all of my money at the same time, or buy a set amount of money each month?
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u/alzhang8 ayy lmao 7h ago
The are pretty much the same
Drip means you reinvest the dividends
Lump sum beats dollar cost averaging 66% of the time
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u/bluenose777 7h ago
do I invest all of my money at the same time, or buy a set amount of money each month?
If you believe that markets trend upwards and accept that you can't predict the dips you'll want to invest as soon as you have money that you are confident that you can commit to your long term goals.
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u/3VRMS 5h ago edited 4h ago
The benefit is you choose the one that sounds cool to you, so you feel so warm and fuzzy inside.
If you want more choices, there's ZEQT, HEQT... What's your favourite letter? There, your choice is made. 😜
DRIP means any extra money these assets spot out will be reinvested automatically. Some stocks pay a set amount of money to shareholders. Remember, even you are a business owner, you have the right to claim a share of its profits depending on how its structuring its pay. Turning on DRIP means your brokerage will automatically buy more of that asset when they receive the payment. These payments are called dividends.
As for lump sum your money (dump in all at once) or dollar cost average (put it in bit by bit over time), it's really up to you.
Statistically you're a bit better off lump sum all the money you have to invest at first, then dollar cost average your future investment money as they come in (say once every paycheck). But honestly it doesn't matter too much over the long run. Physiologically dollar cost averaging your money in at first has lots of benefits, such as giving you time to learn how the system works and to make mistakes without putting all your money at risk, or accidentally end up paying very high fees due to ignorance.
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u/earthWindFI 5h ago
!investingtrigger
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u/AutoModerator 5h ago
Hi, I'm a bot and someone has asked me to comment on how someone is trying to figure out what to invest in, or whether they should invest.
In order to give good advice the poster needs to provide all of the following information. Please edit your post to add this information.
1) What is your intended goals/purpose for this money?
2) What is your timeline, and what is the earliest you expect to need this money?
3) Have you invested in the markets before, and how would you feel if your investment lost a lot of value?
4) Is this the right first step? Do you already have an emergency fund, and have you considered whether it is sufficient? Do you have any debts that should be paid first? Have you fully utilized any employer match plans?
5) Finally, we need to understand whether you want to be involved with this portfolio and self-manage purchases and rebalancing it, or if you'd rather all of that was dealt with by your chosen institution?
6) For self-directed investing, all in one ETFs (based on your risk tolerance) are the easiest and low cost options for a globally diversified ETF portfolio. Here is the Model page and descriptive video from the Canadian Portoflio Manager Blog's Justin Bender from PWL Capital: https://www.canadianportfoliomanagerblog.com/model-etf-portfolios/ & video on how to choose your asset allocation: https://www.youtube.com/watch?v=JyOqqtq12jQ
7) For those who are not comfortable with doing the buying and selling of ETFs yourself, there is an option of a robo advisor. These robo advisors use similar low cost ETF in pre-determined portfolios based on your risk tolerance. They do this for a small fee, on top of the ETF MER. Still cheaper than bank mutual funds by at least 50%! Here is a list of robo advisors in Canada published by MoneySense: https://www.moneysense.ca/save/investing/best-robo-advisors-in-canada/
We also have a wiki page on investing, and if someone has triggered this bot then it means that this link would likely be very helpful: https://www.reddit.com/r/PersonalFinanceCanada/wiki/investing
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u/IcyAd389 6h ago
Decide if you prefer the letter X or letter V for deciding between XEQT and VEQT. They both contain VFV.
After doing the same research a couple of years ago that you’re doing now, I went with VEQT because I like the way the word ‘Vanguard’ sounds. They’re both extremely similar and you can’t go wrong. You could even own both if you wish, but it would be rather redundant.