[December 2023] Stock investment using only Canadian ETFs

hello. This is Miki’s Honey, MikiHoney. I’m planning to start a stock investment series using only Canadian ETFs.

First, I’ll explain the general overview and reasons, and then gradually share it whenever I buy or sell individual ETFs.

Personally, I liquidated almost all of my individual stocks (US and Canada) this December and moved all my investment accounts to Wealthsimple.

The reason is that Wealthsimple has free EFT trading fees and Cash Account gives 4-4.5% interest.

First of all, if you want to open a Wealthsimple account, use my referral code and you can get $25 together.

Free EFT transaction fees are very important when using a TFSA or RRSP account.

I didn’t know what would happen to the stock market at the end of last year, so I bought a bond ETF expecting that bond interest rates would drop this year. This is because the Federal Reserve continued to raise bond interest rates and bond prices continued to fall until recently. In such a situation, products offering 5% GIC are released all the time in the summer, so I thought there was a reason to hold bonds, so I sold the bond ETF and bought GIC. Haha, I should have been holding that bond ETF until now!!

Still, my rule when it comes to making a loss is not to sell at all. So, although it is small, the remaining bonds have gone up, which is giving me some comfort.

However, GIC has poor liquidity and trading is inconvenient, so I looked into it and found that there is an ETF like GIC. CASH.TO or HSAV.TO, these two ETFs are like savings accounts that give a fixed interest rate of almost 5%. Trading can be done like a regular ETF.

How convenient is it compared to GIC? however! TD Direct Investing does not allow you to purchase these two ETFs. I’m devastated. So, I decided to change stock brokerage companies, and when I heard that Wealthsimple was having a promotion where I was giving away iPhone 15s, I closed out all my investment accounts and moved to Wealthsimple.

All transaction fees are free! Plus, get an iPhone 15 for free!

However, Wealthsimple has the disadvantage of US$ exchange when buying and selling US stocks, so I decided to liquidate all US stocks and trade only with Canadian ETFs.

Almost all investments made with ETFs so far have made profits, but most individual stocks have suffered losses. It was very difficult to determine the timing when to buy and sell. In particular, individual stocks had large fluctuations and suffered greater losses.

On the other hand, ETFs do not fluctuate as much as individual stocks, so the holding period is longer and they always generate profits.

In conclusion, when investing in ETFs, you can hold them for a longer period of time without having to panic, and when you sell, you do not have to sell in a panic. In short, I think it complements the shortcomings of individual investment.

So, currently, I have liquidated all individual stocks and only hold three ETFs: HSAV.TO, HXQ.TO, and VFV.TO.

Oh, for your information, half of my total financial assets are fixed in S&P 500. I will definitely not sell this class until I retire. Even as my assets increase, I always keep half of the total as S&P500 and change it around with the other half. Haha, I can’t beat the S&P500. What kind of stupid thing have I been doing? lol

Investing in individual stocks sometimes produces good returns in the short term, but as time goes by over the course of a year or two, you end up paying for it.

So, I filled the remaining half of the operating amount with S&P 500 and Nasdaq 100, and now I am only trying out 1/4 of the total.

I’m planning to buy bonds with this, go with cash, and then buy sector-specific ETFs again.

Or, eventually, the rest might switch back and forth between cash, NASDAQ, and S&P 500. lol. In any case, it is important to note that Wealthsimple also gives 5% interest on cash through the CASH ETF!

ah! However, if you are working in Canada and do not yet own a house, I emphasize once again that you should open an FHSA account and invest without thinking about anything else.

This means you must earn at least 20%! You don’t have to buy stocks. Even if you just buy GIC or the CASH.TO EFT mentioned above, you will start with a 20% profit per year!

If you are an office worker who has not yet purchased a home, please read this article and sign up for FHSA right now!

https://en.wonderfulmiki.com/2023/12/14/canada-employee-investment-series-9-fhsa/

Current ETF holdings

1. HSAV.TO – Cash ETF
2. HXQ.TO – NASDAQ 100 ETF
3. VFV.TO – S&P 500 ETF
4. VLB.TO – Canada Long-Term Bond ETF

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