Pennsylvania-based Vanguard Group administers about $5 trillion U.S. in assets spread across 388 mutual funds and ETFs. Canadians can buy Vanguard exchange-traded funds listed on stock exchanges.
Generally speaking, Canadians are blocked from buying mutual funds that are registered in the U.S. unless those funds are also registered with provincial securities commissions. Moreover, some Canadian funds are only available in a limited number of provinces.Canadians can buy Vanguard exchange-traded funds listed on stock exchanges.
ETFs can play an important role in portfolio diversification. Vanguard can help supply that diversification with these two low-fee ETFs. The first covers large cap U.S. companies, which have performed well over the last few years. The second covers the leading emerging markets, with a strong focus on Asia. It has moved down lately along with most emerging markets, but is still up over the past year.
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VANGUARD GROWTH ETF (New York symbol VUG; buy or sell through brokers) aims to track the Center for Research in Security Prices (CRSP) U.S. Large Cap Growth Index. It’s a broadly diversified index that consists mainly of big U.S. companies.
The $75.2 billion fund holds Apple, Alphabet, Amazon.com, Facebook, Comcast, Home Depot and Visa. Its other stocks include Philip Morris International, Mastercard and Boeing. Vanguard launched the ETF on January 26, 2004. Its MER is just 0.06%.
The fund’s breakdown by industry is as follows: Technology, 27.5%; Consumer Services, 20.4%; Industrials, 14.2%; Financials, 13.2%; Health Care, 11.2%; Consumer Goods, 8.7%; Oil and Gas, 3.5%; Materials, 1.1%; and Telecom Services, 0.2%.
Recommendation in Canadian Wealth Advisor: Vanguard Growth ETF is a buy.
ETFs: Mainland China, Taiwan and India make up almost 60% of stock in this ETF
VANGUARD FTSE EMERGING MARKETS ETF (New York symbol VWO; buy or sell through brokers) aims to track the Financial Times Stock Exchange (FTSE) Emerging Markets Index. It’s made up of the common stock of companies in developing countries. The ETF was launched on March 4, 2005.
The MER for Vanguard’s FTSE Emerging Markets ETF is 0.14%.
The top holdings for Vanguard FTSE Emerging Markets include Tencent Holdings (China: Internet), Taiwan Semiconductor Manufacturing (computer chips), Naspers Ltd. (South Africa: media), China Construction Bank Corp., China Mobile Ltd., Industrial & Commercial Bank of China, Sherbank (Russia: banking), Itau Unibanco Holding (Brazil: banking), Alibaba Group (China: Internet) and Ping An Insurance Group of China.
The breakdown by country for this $93.8 billion fund is as follows: Mainland China, 34.2%; Taiwan, 14.5%; India, 10.6%; Brazil, 8.3%; South Africa, 7.4%; Thailand, 3.9%; Russia, 3.8%; Malaysia, 3.3%; Mexico, 3.2%; Indonesia, 2.2%; Philippines, 1.3%; Chile, 1.3%; Poland, 1.3%; Turkey, 1.1%; and others, 3.6%.
Recommendation in Canadian Wealth Advisor: Vanguard FTSE Emerging Markets ETF is a buy for aggressive investors.
Thanks for your comment! We cover a wide range of both Canadian and U.S. ETFs—including in our Best EFs for Canadian Investors newsletter—and sometimes the U.S. versions have lower fees.
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What is the advantage of purchasing ETF on the New York market when many Vanguard ETF ‘s are available on the TSX?
Thanks for your comment! We cover a wide range of both Canadian and U.S. ETFs—including in our Best EFs for Canadian Investors newsletter—and sometimes the U.S. versions have lower fees.
Great idea to diversify!
Yes, we continue to recommend passively managed, high-quality ETFs as one way to diversify your portfolio.