
TSE:VFV
This summary was created by AI, based on 6 opinions in the last 12 months.
The Vanguard S&P 500 Index ETF (VFV) garners mixed opinions among experts, primarily due to its non-hedged nature against CAD currency fluctuations. While some praise its long-term potential, particularly for investors with a decade or more horizon, others are wary of current high valuations, especially given that a considerable portion of the ETF comprises tech-related stocks. Concerns also arise regarding potential overvaluations linked to mega-IPOs and their future impact on the S&P 500. For new investors transitioning from GICs to equities, experts advise caution and recommend diversification, including exposure to other geographical markets and asset classes. Overall, while VFV could serve as a core holding, a balanced approach considering alternative ETFs may be more prudent.
This is pretty simple and straightfoward: it covers the S&P 500. There's no hedging in this. It comes down to how you look at the markets now. Himself, he really likes the S&P 500 as a place to invest in. The wild card are rising trade tensions. He believes there will be a resolution at some point. VFV charges only 8 basis points.
Sell this and Buy the hedged version? He just took off of his Canadian hedges today. The Cdn$ has had a strong run up, and there are built-in expectations by the Bank of Canada that the Cd$ is going to go higher. Thinks Bank of Canada has gotten a little ahead of itself and the inflation and growth forecasts for next year are a little too robust. He wouldn’t be worried about the Cdn$ going up further. If you want to be long the US market, you want to stay with the unhedged version.
S&P 500? There are at least a dozen ways to buy this in Canada. Four of the ETF’s each offer at least 2 of the versions. Also, you can get it currency hedged or unhedged. The vast majority of these ETF’s are very similar to one another. Most of them are very, very cheap. This one is among the lowest cost. A great way to get US Large Cap in an unhedged way.
Or other similar ETFs? They're all basically the same thing: the S&P 500, the number one index in the world, holding every famous American stock you can think of. Looking ahead, he expects other country indexes to outpace the S&P 500, including the TSX. But you should still have some exposure to the S&P 500. Go with the equal-weighted S&P 500, rather than the hedged or unhedged ETF. Go with the EQL--it's fine. Don't worry about the CAD, because the Bank of Canada won't allow the CAD to go much above 79 cents.