Comments on: TD Gets Out of ETF Market

By: Investing Intelligently » Blog Archive » New Non-Market Cap Weighted Canadian ETF

Wed, 22 Feb 2006 09:02:15 +0000

[...] It makes me wonder why it is called a non-market cap index. They have used factors such as “total cash dividends, free cash flow, total sales and book equity value” which are directly or indirectly correlated to the market capitalization. I will look into this RAFI Index methodology in greater detail (if I can find details that is). This is a start anyways. At least we now have some other choices available for large cap semi-passive ETFs in Canada after the demise of TD ETFs. [...]

By: Dave

Dave — Fri, 13 Jan 2006 06:49:47 +0000

You’re totally correct, it depends on a) how much money is involved and b) how long one plans on holding it for. It also depends on how many stocks one buys. It certain cases it does work out.

By: Mike

Mike — Fri, 13 Jan 2006 03:53:30 +0000

You say by establishing your own “index” of the top companies you have a mer of 0%.

Unless you are buying huge amounts and planning on holding forever, you’ll end up spending more because you have to pay commision 10 times to buy and 10 times to sell. If you buy an index, only 1 commision to buy, 1 to sell.

that could save you quite a bit of money in the long run.

I think you’d be better off buying s&p index for now.

By: Dave

Dave — Tue, 10 Jan 2006 16:55:23 +0000

Yeah, I only mentioned those because I was mainly thinking of broad large cap indexes. I don’t have enough money in my RRSP yet to start branching into the sector ETFs, while still keeping my costs/commissions low.

I don’t know much about REITs, so getting an index is something I could see myself doing, unless my advisor had something else in mind then I would go with his suggestion.

By: Rick

Rick — Tue, 10 Jan 2006 15:53:00 +0000

You mentioned only XIU, XIC, XMD and XDV for Canadian Market. How about XRE? Do you have any other particular suggestions for any REITS in a portfolio?