John DeGoeyVanguard Cdn. Aggreg. Bond ETFVAB.TOCOMMENTJul 12, 2012

An aggravate bond ETF. He sits on this kind of thing as a core anchor. The bond universe has many long bonds and they are not likely to be stellar performers.

(A Top Pick May 26/16. Down 0.81%.) This has lost a bit of ground, but on a total return basis, because of the yield to maturity, it is still a little bit up. There are bonds in this and they are paying a coupon, so it is doing what it is supposed to do. It is meant to be the ballast in a portfolio, not meant to deliver total returns.

They are not going to crank the rates up soon, so he would prefer to use this one.

A fairly low fee and gives exposure to the entire Canadian bond market. The “entire” Canadian bond market is probably a bit riskier than what most retail investors want to get out of their fixed income exposure, because of the long maturities that are out there. This has a weighted average duration of about 7 years. He supplements this with some shorter term, corporate credit ETF’s, to bring down the overall risk of the whole portfolio.