Exchange Traded Fund Portfolios
Our three model portfolios have continued to demonstrate consistent performance for investors choosing to replicate the models. The value of properly diversifying an investment portfolio has been demonstrated with the US markets at record highs, and the core holding of the Vanguard US ETF up over 40% since it was added to the models.
Our Core Balanced ETF Model is designed to provide core indexation of Canadian, US and emerging market equities combined with a 40% weighting in fixed-income ETFs for asset class diversification. Overall, it is a medium-risk balanced approach to investing and works well when combined with individual security positions designed to provide returns over and above the indexed approach.
The Growth ETF Model is suitable for investors seeking growth with a medium to high risk profile. Given the core holding in broad equity markets combined with sector specific ETFs, it has produced solid returns but increased volatility as compared to the Core Balanced model. The First Trust Alphadex US Dividend Plus ETF was recently added which gives the portfolio an overweight position in the US market.
Lastly, the Balanced Income ETF model provides monthly dividend and interest income with a current yield of approximately 4.18% annualized. The model is suitable for investors seeking monthly income using low cost and diversified ETFs with low volatility.
ETF Model Portfolio Returns – To February 28, 2014
Model Portfolio 1 yr *2 yr *3yr
Core Balanced 10.54% 8.50% 5.68%
Growth 9.94% 7.49% 4.30%
**Balanced Income 5.45% 6.37% 5.84%
S&P/TSX Comp 11.6% 6.57% 0.40%
*2 yr and 3 yr returns are annualized.
**Balanced Income returns are to December 31, 2013.
All returns exclude any fees and/or commissions. Returns fluctuate and are not guaranteed. Past performance is not indicative of future performance.