ProShares Geared ETFs

 

With more excellent index ETF options in such as Vanguard, Blackrock, BMO coming to Canada, index investing has become even easier and more profitable.

I would be interested to hear the thoughts from more experienced investors including the different taxation implications. In such a weighting scheme, larger market cap companies carry greater weight than smaller market cap companies.

The Full ProShares Lineup

OppenheimerFunds Investments has expanded on its line of revenue-weighted ETF strategies with two new international dividend options.

Even if I did though. It would cost me the same amount in brokerage costs regardless of what option I chose. I would still be only making 12 trades a year. They are different products. I reinvest them of course!

They arrive in my account and I use them in my next purchase. Have a read of this https: How do you arrive at 0. From what I can see: The international fixed interest allocation is, and a fraction of the international shares allocation is hedged. The majority of international equity exposure is unhedged. Just wanna say the radio interview was great. I saw you mention it in your other post, and not being happy about your answer — but you were great!

Loved your breakdown of all of this. I often have arguments with my friends about MER as they justify it from their end. Hailing from Canada where the banks often charge you 2.

My good friend and fellow FIRE blogger Pat did a fantastic article about franking a little while back. Check it out here. Just starting following you a month or two ago. Really enjoying your posts. Keep up the good work!

Does vdhg automatic rebalancing? Depends on how you are rebalancing. I might do an article about rebalancing. Hope this makes sense. Just be aware that the extra fees add up over time. Rebalancing will almost certainly create a tax event for the end holder, unless the underlying funds are sold at a loss. How could it not? My understanding is any income received, asset sold and cap gains realised inside a trust structure which is what ETFs and managed funds are must be passed thru to the end shareholder.

Just like the small turnover VAS has results in some capital gains as part of the distributions each year, as an example. Perhaps the trust uses any reinvested dividends or coupons to buy into any asset class it is currently underweight? How does the diversified ETFs re-balance? One thing to note also: VDHG also gives you international small companies index.

Ben I think Aussie Firebug already has plenty of property exposure through his investment properties, roughly three quarters of his net worth in fact, so it probably makes sense not to have more here?

I think there is a case to be made for bond and commodity ETFs, they tend to be good diversifiers and can have negative correlation with shares and property which helps smooth returns over time, but the performance tends not to be as good historically. So if you need some comfort when things are going bad that you have some investments that will likely hold up ok, then it makes sense.

Cheers Sean most appreciated, do u or anyone here have any commodity, reits or bonds ETFs they could recommend with low MER would love to check and compare some. Have also just discovered this bit of information on the barefoot investor forums…..

Anyone know the tax residency of the structures underlying the ETF which actually hold the investments made, that might make a difference? As the wife and I began our FIRE stage this year, the limitations of a market at all time highs, along with low interest rates meant, we went more VHY in the short term to provide income an will be averaging into VAS as we go along.

Also having in hand a bunch of USD, I went a slightly different route, opening an account at Schwab and buying VTI directly — again averaging in perhaps over the next twelve months. Thanks for the article and all the comments! Your note on the higher cost of VDHG scares me a bit. I currently only have the ability to save around 6k a year for ETFs also simultaneously saving for a property deposit. I was looking at the retail fund option which has much higher costs compared to its ETF.

The ability to BPay smaller amounts per week into a retail fund rather than saving 12 months to purchase one 5k bundle seemed appealing at first. But reading this I might rethink my options now. Still will be investing in VDHG. Just wondered what your thoughts are and if you might start looking at that instead of VAS. Hi, I have a question about the investments within the EFT itself. I do a bit of Uber driving and had a guy in the car who worked for the investment arm of a bank.

He thought that Vanguard were a good operator, but does anyone know whats actually inside the EFT box? It seems like you will be actually paying double fees because of these funds have their own fees and then you also pay the VDHG fees on top of that. This ensures investor do not incur duplicate fees.

Unlike investment platforms like StockSpot and Acorns. Hi all, Great post!! Just a quick question. My question is what strategy do you employ to add funds to your investment? I like to think of the brokerage fee as a percentage of the purchase price. I have essentially been charged a 0. Of course, everyone is different though, and you need to be comfortable with whatever option you choose. Now as for the whole managed fund vs ETF debate. It really comes down to how often you purchase and at what amounts.

SelfWealth has been great. Does exactly what I need it to do and is the lowest brokerage fees. Everyone should use them. Your calculations are spot on. I purchase one ETF the one whose weighting is the most out each month which would mean the brokerage fees would be the same.

The only difference would be the management fees. Also, as the portfolio grows, the brokerage means less and the management fees really come into effect.

My main concern is myself! Rebalancing should more straightforward as probably just need a good spreadsheet. Hence automating it sounds extremely attractive especially with the DRP turned on during wealth accumulation.

The downside to Wholes Vanguard High Growth Index Fund is that its asset allocation is fixed and not flexible although that can be changed by buying into another fund to rebalance the portfolio.

Do you just buy at a fixed time in a month i. So, dollar cost averaging or value cost averaging VCA? And if VCA, how do determine when is the right time to buy? If so, how much? No timing or waiting. As soon as we have it, I transfer it over to SelfWealth and do the trade.

The main advantages I see with direct investment in one or more Vanguard index funds at wholesale rates is: I have never invested in index funds or ETFs before, so there may be other issues that I am not aware of. I would be interested to hear the thoughts from more experienced investors including the different taxation implications. Any thoughts would be appreciated. I plan on rebalancing by increasing my holding in the fund most lacking behind the desired allocation.

I would aim for a certain amount to be invested each month and top up the allocation that needs it the most. When you build up the portfolio to a decent amount the market swings will be the major cause to weighting in balance.

How much can you save each month? It may be worth looking into opening an account with vanguard so you can bpay each month smaller amounts and not pay brokerage. I was going back and catching up on the podcasts and recently listened to both your Vanguard as well as the stockspot podcast which got me thinking. Stockpot obviously has a management fee effectively 0. Brokerage is covered in their fee though. Though you could always add individual ETFs to your diversified.

I cant see how stockpot can offer a significant advantage at the cost — even though not excessive. As long as you are able to assess your own investment profile, needs and strategy. They can add value not by offering a superior investment, but by making the process of investing extremely easy, friendly and helpful.

There is a market like this in just about everything. You can learn how to get fit by learning online and watching videos and stuff. Or you can pay a personal trainer who can show how everything works and what to do.

But you pay extra for the PT of course. Thanks for the helpful advice FB. Do you have any? Thanks for your site.

I honestly have not looked into ethical ETFs, to be honest. I also would like to hear from others who have more experience on this subject. Does anyone know how the diversified ETF s Behave in a market crash? Any thoughts would be great. I have a cash buffer that I would like to keep topped up with dividends. Im 37 and deciding which to go with.

Im lazy and want a set and forget etf that is simple. I wonder how it works later in life when you to reduce asset allocation to more bonds,cash over stocks though?

Thank you so much for this excellent comparison. My concern is are we comparing apples with oranges? The diversified index ETFs are a different product and marketed to different investors. Yes you san buy it through online broker or thru vanguards. Yes pretty sure inclusive of mer?

Your email address will not be published. Notify me of follow-up comments by email. Financial Independence Retire Early. Always do your own research when dealing with your finances One ETF to rule them all? If I change the management fees to be 0. Guy on April 1, at 6: Aussie Firebug on April 2, at Steve on April 3, at 1: Aussie Firebug on April 3, at 2: Everything else is speculative. Yeah it is definitely a huge amount of fees over time!

To quote the great Oracle of Omaha: Cheers keep up the good work Reply. Aussie Firebug on April 16, at Nik on April 2, at 3: Great article mate, i really enjoy reading your journey.

Sean on April 2, at 3: Option 2 all day baby! Rhyski on April 27, at 9: Aussie Firebug on May 1, at 9: Yes I manually reinvest them. Mr HM Phil on April 2, at BTW, I really enjoyed this post — a great read. Check out Australian Super index balanced Reply.

Aussie Firebug on April 3, at 1: Bob on April 3, at 9: I would be less worried about the small details and just commit to regular saving and investing while also enjoying your life on the road to FI Reply.

For more complete information please review the prospectus. The performance quoted represents past performance and does not guarantee future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when sold or redeemed, may be worth more or less than the original cost. Shares are bought and sold at market price not NAV and are not individually redeemed from the fund.

ET when NAV is normally determined for most funds and do not represent the returns you would receive if you traded shares at other times. Brokerage commissions will reduce returns. Current performance may be lower or higher than the performance quoted. For standardized returns and performance data current to the most recent month end, see Performance. Shares of these funds are bought and sold at market price not NAV and are not individually redeemed from the fund.

Investing involves risk, including the possible loss of principal. ProShares ETFs are generally non-diversified and each entails certain risks, which may include risks associated with the use of derivatives swap agreements, futures contracts and similar instruments , imperfect benchmark correlation, leverage and market price variance, all of which can increase volatility and decrease performance.

Please see their summary and full prospectuses for a more complete description of risks. Carefully consider the investment objectives, risks, charges and expenses of ProShares before investing. This and other information can be found in their summary and full prospectuses. Read them carefully before investing. All have been licensed for use by ProShares. ProShares have not been passed on by these entities or their subsidiaries or affiliates as to their legality or suitability.

ProShares are not sponsored, endorsed, sold or promoted by these entities or their subsidiaries or affiliates, and they make no representation regarding the advisability of investing in ProShares. Registered Investment Companies are required by the IRS to distribute substantially all of their income and capital gains to shareholders at least annually. For specific tax advice, we recommend you speak with a qualified tax professional.