iShares S&P/TSX Cap. Cons. St. (XST.TO)

Prefers the consumer discretionary side of the equation. Staples is a little bit more defensive with less torque. The big winning trade has been discretionary for the last 9 years. This will still be a good play. The fact that it is global in nature is also appealing. He would be happy to own this.

An ETF that has consumer staples stocks? Not something he normally follows, but if you like the sector by all means. It is diversified. A little bit niche for him. He would rather be looking at more consumer stocks in the US.

This has done extremely, extremely well. Some of the valuations are getting slightly stretched at some point. He prefers the BMO’s Low Volatility ETF (ZLB-T) which gives more diversification.

When dealing with a Canadian ETF like this, he doesn’t think there are a lot of components to it. It has 25% Alimentation Couche-Tard (ATD.B-T), 20%+ Loblaws (L-T) and a large amount of Saputo (SAP-T). Price to book is about 2.75 and PE is around 30. That is getting up there a little bit. For consumer staples, he would prefer the US where there is more diversification. He would prefer SPDR Consumer Staples Sector (XLP-N) because it is a lot more diversified. Also, the Canadian one has very high fees of around 60 basis points.

There is still room in the other segments of consumer staples (apart from Shopper’s) to give you a good rate of return.