1stmilliondollar.net

A financial journey to our first million dollar

Posts Tagged ‘stocks’

ETFs and Index Funds in Our Portfolio

March 11th, 2010

We have just added a new page in our blog, called Portfolio. You can access it from the links at the top of our blog. This page contains the complete picture of our portfolio. As we mentioned in our previous posting, we use ETFs and index mutual funds. We also use dollar-cost averaging in our retirement account. Lastly, we try to keep our portfolio as simple as possible.

15% US Index

PowerShares QQQ Trust, Series 1 ETF (NASDAQ:QQQQ)
BlackRock Enhanced Capital and Income Fund (NYSE:CII)

15% Canadian Index

CIBC Canadian Index (CIB300)

15% Emerging Market Index

Claymore Canadian BRIC ETF (TSE:CBQ)
Market Vectors Brazil Small Cap ETF (NYSE:BRF)
Claymore/AlphaShares China Small Cap ETF (NYSE:HAO)

30% Fixed Income

TD Canadian Bond Index (TDB966)
iShares iBoxx High Yield Corporate Bonds ETF (NYSE:HYG)
PowerShares Financial Preferred Portfolio ETF (NYSE:PGF)

5% REIT

Vanguard REIT ETF (NYSE:VNQ)
iShares Canadian S&P/TSX Capped REIT ETF (TSE:XRE)

Notes

For the US index, we basically invest in Nasdaq-100 and S&P 500. We use a closed-end funds (CII) for S&P 500 because of its dividend. Check also our posting here for a couple of different closed-end funds that replicates S&P 500.
Although Canada represents only 2% of the world GDP, we maintain a pretty high percentage of Canadian index. Why? It’s just because we live in Canada. Our “native” currency is Canadian dollar.
We know that CIBC Canadian Index might not be the best mutual funds. However, we have to keep it this way until end of next year.

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Posted in Portfolio

Tags: BRF CBQ CII ETF funds HAO HYG index nasdaq PGF Portfolio QQQQ s&p 500 stocks

Stay Invested with the Index

February 26th, 2010

We just read a news from The Globe And Mail about performance of Canadian equity funds. Many actively managed mutual funds in Canada cannot beat the index, i.e. S&P/TSX composite index. Here is the result:

Year 2009: 39.2% of actively managed funds beat the index
Over 3 years: 12.5% of actively managed funds beat the index
Over 5 years: 7.7% of actively managed funds beat the index

That’s why; we recommend to invest in the index. As you can also see from our portfolio, most of our money is currently parked in the index as well. Only small amount of money that is used for speculation, including stock picking and timing the market. That’s why; we still have stock picks and participate in the Canadian blogger’s stock picks contest.

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Posted in Investment

Tags: index investing Investment pick s&p 500 S&P/TSX stocks

Are We Stock Picker?

February 14th, 2010

investing_1

If you’ve been reading a couple of our last postings; you might be wondering: are we stock picker? We’ve been talking about stock picks, see here, here and here. In fact, we have never talked about ETF or mutual funds.

The answer to this question is: yes and no. We have a diversified portfolio; a large amount of them are invested, surprisingly, in ETFs and index mutual funds. We allocated only about 10% are invested in individual stocks. We’ll discuss more about our assets allocation in future posting.

Why don’t we just invest in index funds and do nothing? Isn’t investing in individual stocks very risky? There are a couple of reasons. One reason is because we want to find ten-bagger. We don’t normally find ten-bagger in index funds, do we? Another reason is because we want to improve our investment skills. We’re still beginner in the investment world; there are a lot of things we need to learn. That’s why; we don’t want to risk too much capital in individual stocks (for now).