Hello, been looking at getting the index funds from TD Bank or the Vanguard ETFs and i can't decide which to get.

I have 20,000 dollars, 3-6 years. 22 years old, Risk :Low to Med.

One of the problems i have is I'm canadian, so i don't get as many options as people from the US. The bank intrest rates blow right now, so that is not an option.

Here is the fund list from TD bank: http://www.tdcanadatrust.com/mutualfunds/prices_EF.jsp

Vanguard fund list:
https://global.vanguard.com/internat...nts/funds.html

I was planning a profile of 50% NA, 25% international, 25% bonds.


Can anyone recommend me which is the better route. Ive heard alot about vanguard, but im less farmilar with what they offer. Which is your recommendation and why?

Also, if vanguard is chosen can u recommend some of the ETFs, given my planned profle?

I didn't see any expense ratios on that TD site but i didn't look that hard. You want to make sure your expense ratios are low. Vanguard in general is really good about low expense ratios. It's easy to find them just look for the total expense ratio as a %. Less than 1% is good.

>0.5% is really bad. ideally you'd be way below 0.5%

Well in an industry that has 3% expense ratios less than 1% is pretty good. It's all a matter of limiting how much you want to get screwed. So you know some funds apples to apples that cream Vanguard's .70-.80%ers?

not sure which ones those are but OP seems to be looking for pretty basic funds which means around 0.2% from vanguard

hmm I am trying to find an emerging markets fund better than vanguards .65% and I'm not seeing one.

https://global.vanguard.com/internat...arketsInv.html

Fidelity is about double

https://advisor.fidelity.com/advisor...OZihUHpUfHA%3D

Ouch MFS emerging B shares are 2.59%. A shares 1.84

https://www.mfs.com/wps/portal/!ut/p...orts&shareId=1

ishares which are usually low are .72%

http://finance.yahoo.com/q/pr?s=EEM+Profile

> .50% isn't really bad

okay, 0.65% for emerging. ~0.2% for everything else.

OP, if you are in Canada then buying Vanguard etfs isn't necessarily a good idea. They're all (that I am aware of) denominated in $US and you'll have to carry exchange rate risk if you invest in them. Check our ishares.ca and BMOs new etfs to find etfs denominated in $CND where the currency exchange back to $CND is fully hedged.

dont know the specifics of those funds but that "hedge" almost certainly costs more than its worth

They are all bellow .5%, http://www.tdcanadatrust.com/mutualfunds/prices_EF.jsp

And yes i am from Canada, i'll take a look at those two.

Also, the currency risk factor of investing with vanguard, our dollar is doing quite well right now better than average so wouldn't that be a good thing?

Ok vanguard is out of the question for me now, requires 100,000 to invest from canada. Im looking at the ishares now, and they look like a pretty good firm so them or TD bank?

Any other suggestions?

You can probably buy the Vanguard ETFs on the market. As long as you can get a Zecco account or some other account you can buy the ETFs without going through Vanguard.

Not at all. It's a pretty tiny cost to buy and roll over currency futures, it only pulls a few basis points off the fund. And the cost of layering undiversifiable, unrewarded currency exchange risk on your equity risk is pretty high.

No, you can set up an investing account with any provider and buy Vanguard ETFs (or any other ETFs) directly off the market. You won't need a minimum account value to do this, but you'll have to pay commissions per trade so you don't want to have too little money or the commissions will be relatively too large.

I definitely wouldn't buy TD's mutual funds, unless you have a tiny amount to invest now or if you will be making regular, frequent, small deposits into your account and buying units, in which case buying ETFs could be more expensive if you pay a commission each time.

Also you should definitely look at BMOs ETFs. They're new in the market and their fees are aggressively low to try to expand business.

Expense ratio wise I think you have to consider what market is being traded.
FXI has an expense ratio of 0.73% but certainly it cost more to do business in china than in japan.
EEM is around that too because it has to cost quite a bit to try to replicate that index.
I think you also have to trust the company, ishares and SPDRs have proven themselves IMO..A new company with a lower expense ratio isn't going to be worth it if they blow 1% vs ishares replicating.
For the US to me there is SPY and nothing else. .09% expense ratio and perfectly replicates the S&P..

For a broker just go here
http://www.interactivebrokers.ca/en/main.php

<0.2 for main market indexes (SP, dow, russell)
<0.5 for sector specific indexes
<0.7 for country specific indexes
<0.9 for alternative investment indexes

so the more "exotic" you get, the more you pay. but never over 1% for etfs

I agree, but for the op I think we should narrow his choices further...
Like I would think op is best with a strategy of SPY, EEM, and cash...
Sector ETFs IMO are too correlated to SPY and any alpha is too random to bother with vs your hold time...
EEM is good vs typical "international mutual funds" because it is extremely broad..while "international mutual funds" tend to over weight Europe huge.

I'm pretty done at this point with "country specific" at this point, or more specific tightening up % risk there..
Anyone own any THD if you are into ishares?

I jumped all over EPOL when introduced for my super risk portfolio part..
Dicked around so much with china ...I never even looked up THD or thought about Thailand until this thread...Was too busy with china and waiting for something to spec on Vietnam...In between there is uhh..duhhhhh..
I'm 60% in SPY though, highly US biased risk/reward wise here...Put THD on watch though and wait for a bull flag..

OP just do something. Beyond the billions on the table, this is the most FUN game ever created..Grinding poker is ****ing dull compared to this game.

I would not worry about the exchange rate risk. The exchange rate is priced in the market usually. Many fortunes have been lost people chasing high interests in certain countries. Does the Stock in the USa have value. If it does buy it.

Also, I would not have any bonds. There is too much risks of higher inflation. Even if the interest rates remain steady, you can still lose to inflation. however, Canada is presently the most responsible country in the world I think.

I would never buy a mutual fund again, unless the manager is an activist investor.

Hard to go wrong with Vanguard in whatever they do. They are conservative, ethical, low-cost and completely boring.

A good thing for financial investments for the future.

Bad governance and crappy boards have been so entrenched for so long thanks to lazy mutual fund managers and the lazy guys still far outnumber the activists.

This is nonsense. There's no way that the exchange rate risk for $US vs $CND is priced into US equities. There is no additional expected return to be had by carrying this risk. It is a stupid risk to have, unless you would rather not pay the cost of hedging. The cost of hedging is not that high. From the view of a Canadian investor, getting your returns in $US is not a great idea.