etf
An ETF (Exchange-Traded Fund) is an investment fund that holds a collection of underlying assets, such as stocks or bonds, in a single pooled vehicle. ETFs allow investors to purchase a variety of different securities at once, providing greater diversification compared to owning individual assets. They are traded on stock exchanges like regular stocks, allowing for intraday trading at market prices. ETFs typically have lower fees than mutual funds and often passively track an index or sector, making them a popular choice for investors seeking a cost-effective way to invest in a diversified portfolio.
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ISHARES CANADIAN SHORT-TERM BOND INDEX ETF $28.73 (Toronto symbol XSB; buy or sell through brokers) mirrors the performance of the DEX Short-Term Bond Index.
This index consists of a range of investment-grade federal, provincial, municipal and corporate bonds with one- to five-year terms to maturity. The fund holds 407 bonds with an average term to maturity of 2.87 years. The bonds in the index are 64.2% government and 35.8% corporate. The fund’s MER is 0.27%.
The iShares Canadian Short-Term Bond Index Fund yields 2.5%, but this high yield is due to the fact that some of the fund’s bonds pay above-market interest rates. As a result, they trade above their face value. When these bonds mature, holders will only get the bonds’ face value, meaning the portfolio will incur predictable capital losses. These losses will offset some of the appeal of the above-market yields.
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This index consists of a range of investment-grade federal, provincial, municipal and corporate bonds with one- to five-year terms to maturity. The fund holds 407 bonds with an average term to maturity of 2.87 years. The bonds in the index are 64.2% government and 35.8% corporate. The fund’s MER is 0.27%.
The iShares Canadian Short-Term Bond Index Fund yields 2.5%, but this high yield is due to the fact that some of the fund’s bonds pay above-market interest rates. As a result, they trade above their face value. When these bonds mature, holders will only get the bonds’ face value, meaning the portfolio will incur predictable capital losses. These losses will offset some of the appeal of the above-market yields.
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VANGUARD GROWTH ETF $108.87 (New York symbol VUG; buy or sell through brokers) aims to track the Center for Research in Security Prices (CRSP) U.S. Large Cap Growth Index, a broadly diversified index that mainly consists of large U.S. companies. The fund’s MER is just 0.09%.
The $47.8-billion Vanguard Growth ETF’s top holdings are Apple, Google, Coca-Cola, Facebook, Oracle, Home Depot, Comcast, Amazon.com, Gilead Sciences and Walt Disney Co.
The fund’s breakdown by industry is as follows: Technology, 24.0%; Consumer Services, 21.3%; Health Care, 13.4%; Financials, 13.0%; Industrials, 11.7%; Consumer Goods, 9.4%; Oil and Gas, 5.3%; Materials, 1.5%; Telecommunication Services, 0.3%; and Utilities, 0.1%.
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The $47.8-billion Vanguard Growth ETF’s top holdings are Apple, Google, Coca-Cola, Facebook, Oracle, Home Depot, Comcast, Amazon.com, Gilead Sciences and Walt Disney Co.
The fund’s breakdown by industry is as follows: Technology, 24.0%; Consumer Services, 21.3%; Health Care, 13.4%; Financials, 13.0%; Industrials, 11.7%; Consumer Goods, 9.4%; Oil and Gas, 5.3%; Materials, 1.5%; Telecommunication Services, 0.3%; and Utilities, 0.1%.
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ISHARES CDN REIT SECTOR INDEX FUND $17.31 (Toronto symbol XRE; buy or sell through brokers; ca.ishares.com) holds the 15 Canadian real estate investment trusts in the S&P/TSX Capped REIT Index.
iShares CDN REIT’s expenses are 0.60% of its assets. The fund yields 4.7%.
The ETF’s largest holding is RioCan REIT at 20.0%, followed by H&R REIT (13.5%), Canadian REIT (7.1%), Canadian Apartment REIT (7.0%), Allied Properties REIT (6.6%), Calloway REIT (6.6%), Dream Office REIT (6.4%), Cominar REIT (4.4%), Boardwalk REIT (5.0%), Chartwell REIT (4.5%), Artis REIT (4.3%), Granite REIT (4.3%), Crombie REIT (2.2%), Pure Industrial REIT (2.1%) and Northern Property REIT (1.7%).
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iShares CDN REIT’s expenses are 0.60% of its assets. The fund yields 4.7%.
The ETF’s largest holding is RioCan REIT at 20.0%, followed by H&R REIT (13.5%), Canadian REIT (7.1%), Canadian Apartment REIT (7.0%), Allied Properties REIT (6.6%), Calloway REIT (6.6%), Dream Office REIT (6.4%), Cominar REIT (4.4%), Boardwalk REIT (5.0%), Chartwell REIT (4.5%), Artis REIT (4.3%), Granite REIT (4.3%), Crombie REIT (2.2%), Pure Industrial REIT (2.1%) and Northern Property REIT (1.7%).
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MARKET VECTORS VIETNAM ETF $18.22 (New York symbol VNM; buy or sell through brokers) holds Vietnamese companies or foreign firms that get a significant amount of their revenue from Vietnam.
The ETF’s top holdings are Vincom Corp. (real estate), 8.2%; Masan Group (a food, resources and banking conglomerate), 7.6%; Bank for Foreign Trade of Vietnam, 7.2%; Saigon Thuong Tin Commercial Bank, 6.4%; Hansae Co. (a South Korean clothing maker), 5.6%; Charoen Pokphand Foods (a Thailand-based food conglomerate), 5.1%; Hoang Anh Gia Lai Group (conglomerate), 4.7%; and Premier Oil (a U.K.-based producer with stakes in the huge Cuu Long basin off southern Vietnam), 4.6%.
The Market Vectors Vietnam ETF’s industry breakdown is as follows: Financials, 42.5%; Consumer Staples, 16.8%; Energy, 15.7%; Consumer Discretionary, 11.1%; Industrials, 6.6%; Materials, 4.6%; and Utilities, 2.6%. Its MER is 0.76%.
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The ETF’s top holdings are Vincom Corp. (real estate), 8.2%; Masan Group (a food, resources and banking conglomerate), 7.6%; Bank for Foreign Trade of Vietnam, 7.2%; Saigon Thuong Tin Commercial Bank, 6.4%; Hansae Co. (a South Korean clothing maker), 5.6%; Charoen Pokphand Foods (a Thailand-based food conglomerate), 5.1%; Hoang Anh Gia Lai Group (conglomerate), 4.7%; and Premier Oil (a U.K.-based producer with stakes in the huge Cuu Long basin off southern Vietnam), 4.6%.
The Market Vectors Vietnam ETF’s industry breakdown is as follows: Financials, 42.5%; Consumer Staples, 16.8%; Energy, 15.7%; Consumer Discretionary, 11.1%; Industrials, 6.6%; Materials, 4.6%; and Utilities, 2.6%. Its MER is 0.76%.
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ISHARES CHINA LARGE-CAP ETF $51.98 (New York symbol FXI; buy or sell through brokers) is an exchange traded fund that aims to track the Financial Times Stock Exchange (FTSE) China 50 Index, which is made up of the 50 largest, most liquid Chinese stocks. All of the companies in the index trade on the Hong Kong exchange. Some also trade as American depositary receipts (ADRs) on New York.
The fund’s top holdings are Tencent Holdings, 8.8%; China Mobile, 8.0%; China Construction Bank, 7.5%; Industrial & Commercial Bank, 6.8%; Bank of China, 5.9%; Ping An Insurance, 4.5%; China Life, 4.4%; CNOOC Ltd., 3.9%; PetroChina, 3.8%; China Petroleum and Chemical, 3.4%; and China Overseas Land & Investment, 2.5%.
The fund’s holdings give it the following industry breakdown: Financials, 48.1%; Telecommunications, 11.7%; Oil and Gas, 11.6%; Technology, 11.1%; Industrials, 6.2%; Consumer Goods, 6.4%; and Utilities, 2.1%. Its expense ratio is 0.74%.
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The fund’s top holdings are Tencent Holdings, 8.8%; China Mobile, 8.0%; China Construction Bank, 7.5%; Industrial & Commercial Bank, 6.8%; Bank of China, 5.9%; Ping An Insurance, 4.5%; China Life, 4.4%; CNOOC Ltd., 3.9%; PetroChina, 3.8%; China Petroleum and Chemical, 3.4%; and China Overseas Land & Investment, 2.5%.
The fund’s holdings give it the following industry breakdown: Financials, 48.1%; Telecommunications, 11.7%; Oil and Gas, 11.6%; Technology, 11.1%; Industrials, 6.2%; Consumer Goods, 6.4%; and Utilities, 2.1%. Its expense ratio is 0.74%.
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Meta Description: Exchange-traded funds (ETFs) give investors a low-fee way to match market indexes, and these two ETFs are the cream of the Canadian crop.
ISHARES CHINA LARGE-CAP ETF $51.98 (New York symbol FXI; buy or sell through brokers) is an exchange traded fund that aims to track the Financial Times Stock Exchange (FTSE) China 50 Index, which is made up of the 50 largest, most liquid Chinese stocks. All of the companies in the index trade on the Hong Kong exchange. Some also trade as American depositary receipts (ADRs) on New York. The fund’s top holdings are Tencent Holdings, 8.8%; China Mobile, 8.0%; China Construction Bank, 7.5%; Industrial & Commercial Bank, 6.8%; Bank of China, 5.9%; Ping An Insurance, 4.5%; China Life, 4.4%; CNOOC Ltd., 3.9%; PetroChina, 3.8%; China Petroleum and Chemical, 3.4%; and China Overseas Land & Investment, 2.5%. The fund’s holdings give it the following industry breakdown: Financials, 48.1%; Telecommunications, 11.7%; Oil and Gas, 11.6%; Technology, 11.1%; Industrials, 6.2%; Consumer Goods, 6.4%; and Utilities, 2.1%. Its expense ratio is 0.74%....
ISHARES CDN REIT SECTOR INDEX FUND $17.31 (Toronto symbol XRE; buy or sell through brokers; ca.ishares.com) holds the 15 Canadian real estate investment trusts in the S&P/TSX Capped REIT Index. iShares CDN REIT’s expenses are 0.60% of its assets. The fund yields 4.7%. The ETF’s largest holding is RioCan REIT at 20.0%, followed by H&R REIT (13.5%), Canadian REIT (7.1%), Canadian Apartment REIT (7.0%), Allied Properties REIT (6.6%), Calloway REIT (6.6%), Dream Office REIT (6.4%), Cominar REIT (4.4%), Boardwalk REIT (5.0%), Chartwell REIT (4.5%), Artis REIT (4.3%), Granite REIT (4.3%), Crombie REIT (2.2%), Pure Industrial REIT (2.1%) and Northern Property REIT (1.7%)....
Pennsylvania-based Vanguard Group is one of the world’s largest investment management companies. In all, it administers almost $3 trillion U.S. in 170 mutual funds. Vanguard, which went into business in 1975, offers low-fee index mutual funds. Generally speaking, Canadians can’t buy units of mutual funds that are registered in the U.S. because they aren’t registered with provincial securities commissions. For that matter, some Canadian funds aren’t available in all provinces. Canadians can, however, buy Vanguard exchange traded funds (ETFs) that trade on stock exchanges. We don’t recommend all of Vanguard’s ETFs, but here are two we do see as low-fee buys....
The Bank of Canada cut its key interest rate to 0.75% from 1.0% in January 2015. The move came after the country’s inflation rate dropped to 1.5%—below the bank’s 2.0% target—reflecting falling oil prices and slowing growth. Inflation has since dropped even further, to 1.2%. Even so, the long-term outlook is for higher interest rates. That’s because heavy deficit spending and the expansion of the money supply in the past few years make higher inflation more likely. We continue to advise against investing in bonds right now. That’s because today’s low interest rates make bonds unattractive, and rising rates would push down their future value....