Stockchase Opinions

Stan Wong Vanguard FTSE Cdn High Div Yd. VDY-T BUY Feb 14, 2023

Canadian dividend ETF

He likes XHU-T, VDY-T and XEI-T, which he owns. All include financials and pipelines.

$44.030

Stock price when the opinion was issued

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BUY
VCN vs. VDY

VCN is an all cap with about 175 stocks. VDY focuses on dividend payers, so it has banks and oil and the like. 

The choice is do you want basic growth or do you want income? VDY for income. VCN for more growth and better diversification.

BUY

Holds banks as the top weighting, which he has no problem with, as many of the banks are undervalued now. Likes this approach. Note that 46% of the portfolio is made up of banks. Yield is 5.2%.

BUY

Likes some of these solid, large-cap dividend names. Interest rate environment's on pause, likely to fall, beneficial for dividend-type stocks. Excellent name to own, nothing wrong with it. 22 bps. He owns XEI, similar strategy. 

BUY

Excellent product with safe dividend. Good for long term investors. Good management team with low MER. 

WEAK BUY

Good holding with a bit of diversity and a bit of yield. Home-country bias for Canadian investors hasn't really worked out for the last couple of years, so good to add diversity like this one. Not the best in the world but, as a whole, likes it.

BUY
Monthly income from a broad-index ETF for a retiree.

He likes XEI and VDY. Both pay ~5% yield. VDY is about 45% Canadian banks. XEI is a bit more diversified, with 23% Canadian banks as its top weighting.

For income, he prefers these to a covered call strategy. Though the covered call strategies look very attractive, they tend to underperform the underlying securities, especially in a rising equity market. Great if you need the income, but you'll get a better total return with the other.

BUY
High-dividend ETF on the TSX.

When you go for high-dividend payers in Canada you get the banks, insurance companies, pipelines, and some of the energy names. Yield will be a bit over 4%. A nice way to play.

Vanguard, iShares, and BMO all have offerings, but they all do it slightly differently. BMO has a covered call version, ZWC. There's ZDV, XDV, VDY. Take a look at them all and see what you like. All have different weights to the components. They're all equally good.

BUY

It holds quality companies that pay dividends. It's hard to go wrong with Vanguard, which are very low priced. This holds 56% financials, 24% energy and 8% utilities. This is where you find Canadian yields.

BUY

Generally likes the dividend payers, depending on the investor. Good if you're looking for income and steady growth. Be aware that a lot of the weighting is bunched around the Canadian banks, with energy companies following. Steady performance, value play. Dividend is fine and growth will be there.

COMMENT

He doesn't know if it's geared to low BETA or not. It is fine as a component of a retirement portfolio.