Opinions
Richard Croft
Vanguard Balanced ETF Portfolio
VBAL-T
BUY
Aug 21, 2019
Stock price when the opinion was issued
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Investing time horizon is long, 10 years in this case. So that lets you take on a bit more risk. Though you'll find 10-year timeframes in the equity market that have delivered losses, that makes the balanced portfolio of stocks and bonds so important.
If you don't want fluctuations at all, there's always cash or a money market fund. But for this time horizon, consider using an ETF with growth potential. For a conservative investor, think about VGRO or VBAL. VGRO is more aggressive, at 80 stocks/20 bonds. VBAL is more balanced at 60/40.
VCNS is for the very conservative, mostly bonds with a bit of equity. It will still grow over time because of the equity allocation, but will be more stable. You could even mix in more bonds yourself. Consider working with a professional on this for a diversified portfolio.
VBAL and XBAL are great, one-stop shops for smaller accounts. Leave it and forget it. Typically has about 40% fixed income, which would have had a tough run up till about a year ago.
VBAL costs about 25 bps for the MER, XBAL costs about 20 bps. VBAL is 41% Canadian content, XBAL is about 45%. XBAL has outperformed for the last 3 and 5 years.
It gives you a 60/40 portfolio and it rebalances for you every few quarters. It's exposed to Canadian and international bonds as well as stocks. It's not a nice vehicle for the average investor looking for a passive solution to markets. Though not the best solution, it is cheap. The problem is the balance; better are risk-managed ETFs that offer more growth without bonds in the mix.