Desert-island ETF picks for 2020

By Jonathan Chevreau on May 17, 2020
Estimated reading time: 2 minutes

Our panellists each pick the one fund they'd leave in their portfolios if they were stranded somewhere and unable to touch their investments.

Overview Canadian U.S. International Fixed-Income All-in-One Desert-Island Picks

As mentioned in the package overview, we have retained this new feature from the 2019 edition to provide additional ETF selections for readers who may be frustrated by the fact so many of our All-star picks are the same from year to year. We asked each panelist to suggest a single ETF they’d be comfortable holding for the long run if they were stranded on a desert island and couldn’t reach the mainland to contact their brokerage. Admittedly, we cribbed the idea from The Motley Fool, but its version involves individual stocks, while ours is focused on much more diversified single ETFs.

ETF Name	Ticker	Management Fee	MER	# of Holdings	Description
Mark Yamada: Horizons Nasdaq 100 Index ETF	HXQ.U	0.25	0.28	100	Technology a key driver next 20 years and TRI structure minimizes tax
NEW! Yves Rebetez: First Trust Indxx Next G ETF (NXTG	NXTG (Nasdaq)	0.7	0.7	100	Nasdaq-based 5G focus: continues to outperform broader market while providing exposure to sectors sorely lacking in Canada
Ioulia Tretiakova: BMO Low Volatility Canadian Equity ETF	ZLB	0.35	0.39	46	Low volatility allows gains to compound more efficiently
NEW! Ben Felix: Avantis U.S. Small Cap Value ETF	AVUV: NYSEARCA	0.25	0.25	534	Small cap & value stocks have exposure to priced risks, leading to higher expected returns
Cameron Passmore - AVUV - Avantis™ U.S. Small Cap Value ETF	AVUV: NYSEARCA	0.25	0.25	534	Small cap value stocks have exposure theoretically established and empirically observed priced risks, leading to higher expected returns than the market.
Dave Nugent: Vanguard Total World Stock	VT, NYSE Arca	0.07	0.09	8,125	Low cost, globally diversified, all cap in US$
Robb Engen: Vanguard All-Equity ETF Portfolio Fund	VEQT	0.22	0.25	23,000	100% equities, global diversification with a low-cost, one-ticket solution
NEW! Dale Roberts: Vanguard Dividend Appreciation ETF	VIG (NYSE Arca)	0.06	0.06	182	Dividend Achievers also includes many Dividend Aristocrats - known to outperform through market corrections. Good combination of growth and lower volatility and drawdown. Already performing better than market in COVID correction.

Yves Rebetez: First Trust Indxx Next G ETF (NXTG). This new pick focuses on fifth-generation technology (5G) wireless networks and next-generation digital cellular technologies. About 80% of the ETF is in infrastructure and hardware and 20% in telecom service providers. Mark Yamada: Horizons Nasdaq 100 Index ETF (HXQ.U). Technology will be a key driver for the next 20 years and the TRI structure means no tax will be incurred while I’m on that island: no CRA penalties! Unhedged is always better for the long run to avoid costs. Ioulia Tretiakova: BMO Low Volatility Canadian Equity ETF (ZLB). Low volatility allows gains to compound more efficiently (it’s about the arithmetic) and exploits the investing “anomaly” that lower risk leads to higher returns. ZLB offers a better diversified take than others in the space. Ben Felix and Cameron Passmore: Avantis U.S. Small Cap Value ETF (AVUV). Small-cap value stocks offer exposure to theoretically established and empirically observed independently priced risks. Targeting these risks leads to diversification and higher expected returns than the overall market. Dave Nugent: Vanguard Total World Stock (VT, NYSE Arca). Low-cost, globally diversified, all-cap in U.S. dollars—buy, hold and add to it consistently over time and you’ll do just fine. Robb Engen: Vanguard All-Equity ETF Portfolio Fund (VEQT). Many investors in the accumulation stages prefer to push the risk envelope and tilt their portfolios to 100% equities. VEQT provides global diversification with a low-cost, one-ticket solution. The 30% Canadian allocation gives me some pause, but it’s not out of line with most model ETF portfolio weightings and certainly less volatile to the movement of foreign currencies.” Dale Roberts: Vanguard Dividend Appreciation ETF (VIG/NYSE Arca). Dividend achievers also include many dividend aristocrats: known to outperform through market corrections. Good combination of growth and lower volatility and drawdown. Already performing better than market in COVID correction.

About Jonathan Chevreau

As MoneySense’s Investing-Editor-at-Large, he is also author of Findependence Day and co-author of Victory Lap Retirement. Reach him at [email protected], where he is the founder of Financial Independence Hub.

Linkedin Twitter Facebook Website

Comments Cancel reply

mkyj says:

May 18, 2020 at 10:22 am

Why the USD HXQ.U? Instead of that CAD HXQ (both are unhedged)

Reply
mkyj says:

May 18, 2020 at 11:44 am

Also, VEQT currently has 12,469 holdings, not 23000.

Was curious why it would have close to 3x the holdings as VT, but it’s still more than I would assume (1.5 x more than VT), why is that?

Reply