- Does Gen Z Have it Harder Than Millennials? - November 20, 2023
- When To Pay Off Your Low-Interest Mortgage - November 6, 2023
- Reader Case: Can’t Work Because of Health Issues and Worried - October 23, 2023
This is going to be a short post today, as we are tragically sequestered away in what appears to be an 18th century manor nestled away in the British countryside at the first-ever UK Chautauqua!
UK Chautauqua
Anyway yeah, tough life. We’ll tell you all about it once we get back.
But in the meantime, being somewhat secluded this week has cut off my normally steady diet of news, so opening up CNN for the first time in about a week was a bit of a shock.
Just…Jesus Christ. That is a LOT of stuff going on. It’s not often we see Nazis, Communists, AND the threat of nuclear war all showing up in one week, but…just…Jesus Christ. I think I’m going to shut my laptop off now and go jump back into the pool.
And here’s where I would do an extended spiel about why news like this should be ignored, but because this is Chautauqua week I’ll have to summarize thusly.
Always invest assuming the world will not end. Because if you’re wrong and the market keeps going up as it always does long-term, you’ll have missed out on the gains by huddling in cash. But if you’re right and the world does end…well, who cares about your portfolio at that point?
So because this is a buy day, nuclear war or no nuclear war, Chautauqua or no Chautauqua, we shall do our regularly scheduled buys as always.
Canadian Portfolio
We begin as always by adding in our cash and taking a snapshot of the portfolio…
| Asset | Ticker | Unit Price | Units | Market Value | Allocation | Target Allocation |
|---|---|---|---|---|---|---|
| Canadian Bonds | VAB | $25.30 | 136 | $3,440.80 | 37.90% | 40% |
| Canadian Index | VCN | $30.60 | 55 | $1,683.00 | 18.54% | 20% |
| US Index | VUN | $43.60 | 40 | $1,744.00 | 19.21% | 20% |
| EAFE Index | XEF | $29.19 | 47 | $1,371.93 | 15.11% | 16% |
| Emerging Markets | XEC | $26.03 | 13 | $338.39 | 3.73% | 4% |
| Cash | – | $1.00 | 500.59 | $500.59 | 5.51% | 0% |
We calculate what we have to do to bring our portfolio back onto target…
| Asset | Ticker | Target Allocation | Unit Price | Current Market Value | Target Market Value | Current Units | Target Units | Difference |
|---|---|---|---|---|---|---|---|---|
| Canadian Bonds | VAB | 40% | $25.30 | $3,440.80 | $3,631.48 | 136 | 143.5 | 7.5 |
| Canadian Index | VCN | 20% | $30.60 | $1,683.00 | $1,815.74 | 55 | 59.3 | 4.3 |
| US Index | VUN | 20% | $43.60 | $1,744.00 | $1,815.74 | 40 | 41.6 | 1.6 |
| EAFE Index | XEF | 16% | $29.19 | $1,371.93 | $1,452.59 | 47 | 49.8 | 2.8 |
| Emerging Markets | XEC | 4% | $26.03 | $338.39 | $363.15 | 13 | 14.0 | 1.0 |
| Cash | – | 0% | $1.00 | $500.59 | $0.00 | 500.59 | 0.0 | -500.6 |
And finally we put in our orders being careful not to go into margin…
| Asset | Ticker | Unit Price | Action | Fractional Units | Units | Proceeds |
|---|---|---|---|---|---|---|
| Canadian Bonds | VAB | $25.30 | BUY | 7.5 | 7 | $177.10 |
| Canadian Index | VCN | $30.60 | BUY | 4.3 | 4 | $122.40 |
| US Index | VUN | $43.60 | BUY | 1.6 | 2 | $87.20 |
| EAFE Index | XEF | $29.19 | BUY | 2.8 | 3 | $87.57 |
| Emerging Markets | XEC | $26.03 | BUY | 1.0 | 1 | $26.03 |
| Total | $500.30 |
American Portfolio
And now to do the same on the American side. We start by adding in our cash and taking a snapshot of the portfolio…
| Asset | Ticker | Unit Price | Units | Market Value | Allocation | Target Allocation |
|---|---|---|---|---|---|---|
| Bonds | BND | $82.06 | 44 | $3,610.64 | 38.40% | 40% |
| US Index | VTI | $126.44 | 21 | $2,655.24 | 28.24% | 30% |
| International Index | VEU | $51.55 | 51 | $2,629.05 | 27.96% | 30% |
| Cash | – | $1.00 | 507.75 | $507.75 | 5.40% | 0% |
We then calculate what we need to do to bring our portfolio back under balance…
| Asset | Ticker | Target Allocation | Unit Price | Current Market Value | Target Market Value | Current Units | Target Units | Difference | |
|---|---|---|---|---|---|---|---|---|---|
| Bonds | BND | 40% | $82.06 | $3,610.64 | $3,761.07 | 44 | 45.8 | 1.8 | |
| US Index | VTI | 30% | $126.44 | $2,655.24 | $2,820.80 | 21 | 22.3 | 1.3 | |
| International Index | VEU | 30% | $51.55 | $2,629.05 | $2,820.80 | 51 | 54.7 | 3.7 | |
| Cash | – | 0% | $1.00 | $507.75 | $0.00 | 507.75 | 0.0 | -507.8 |
And finally, we enter in our orders being careful not to go into margin…
| Asset | Ticker | Unit Price | Action | Fractional Units | Units | Proceeds |
|---|---|---|---|---|---|---|
| Bonds | BND | $82.06 | BUY | 1.8 | 2 | $164.12 |
| US Index | VTI | $126.44 | BUY | 1.3 | 1 | $126.44 |
| International Index | VEU | $51.55 | BUY | 3.7 | 4 | $206.20 |
| Total | $496.76 |
And with that we are done. Thanks everyone, and see you next week!
Continue onto the next article!
WORKSHOP TOOLS
How much does it cost to participate in the Investment Workshop? NOTHING. Because that's how we roll. All we ask is that you sign-up using the following affiliate links to keep it free forever:
For Canadians:
For Americans:
Or, prefer to use a Robo Advisor? Check out Wealthsimple, and get your first $10,000 managed for free!
Disclaimer: The views expressed is provided as a general source of information only and should not be considered to be personal investment advice or solicitation to buy or sell securities. Investors considering any investment should consult with their investment advisor to ensure that it is suitable for the investor’s circumstances and risk tolerance before making any investment decisions. The information contained in this blog was obtained from sources believe to be reliable, however, we cannot represent that it is accurate or complete.
A good week to miss the news… very frustrating that we have a president that is such a dud.
Better than having a dunce prime minister in Justin Trudeau…all selfie and no steak…
2019 is coming soon…
Jesus Christ…how can you put money w/ all that going on? aren’t you scared after all you’re retired.
I’m placing Trailing Stop Loss on all my positions just in case it stops going up for a while
I was scared when he got elected. You buy when you’re scared. That’s usually when everyone’s running the opposite direction.
Or in the words of Buffet: “We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.” Easier said than done but right on the money.
What do you mean when you say careful not to go into margin? Do you mean going Into borrowed funds like margin investing?
Right. Only buy with the cash you have and don’t go into borrowed money. That’s called going into margin.
Where do you factor in your trading fee from your institution? For example, BMO Investorline charges $9.95 per trade. Are you paying 8x $9.95 every month for trades?
Buys are free with Questrade. Sells are $4.95. In the workshop, we are in the accumulation phase so only buys are done. We don’t rebalance often so it’s pretty much free.
$9.95 per trade is a terrible deal. Feel free to switch to Questrade: https://www.questrade.com/QBAFFL50T102?refid=feb23fb6&a_bid=37abddad
What do you think about investing in stocks that give you back dividend and using DRIP? Do you think it is worth it?
1) Not a fan of individual stocks. We advocate for index investing using low cost ETFs.
2) Generally, I like to choose ETFs that pay me dividends as cash so I can choose how to allocate it. But DRIP isn’t a bad thing.