Investing

Best Stocks ETFs MFs for RESP?

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  • Jan 10th, 2019 6:44 am
[OP]
Member
Jan 20, 2017
225 posts
35 upvotes

Best Stocks ETFs MFs for RESP?

I prefer to buy US stocks instead of Canadian but my resp account at bmo does not allow holding of usd. If I buy and sell US stocks, the currency conversion may make it a wild goose chase.
What are some recommendations for resp holdings considering a time span of 4-5 years?
10 replies
Deal Addict
Jan 3, 2013
1999 posts
268 upvotes
Sidney
ZWE is the one I have for my US allocation. Dividends re-invested monthly.
Deal Addict
Oct 4, 2009
2423 posts
1169 upvotes
Montreal
4-5 years from withdrawal time is usually when it is time to start buying GICs that mature during the summer before each new school year.

For longer time horizons the new balanced ETFs from Vanguard and Ishares are great one fund solutions for RESPs. VGRO/XGRO early on, moving to VBAL/XBAL and then adding GICs.
Member
Sep 9, 2012
372 posts
119 upvotes
TORONTO
I doubt anyone knows what will perform best over the next 4-5 years.

If you will absolutely need the money by that time, why not put it into 4 or 5 year GICs?
Jr. Member
Mar 6, 2010
160 posts
39 upvotes
Brampton
Why not switch to TDDI and play with US Stocks for next few years?
Deal Addict
User avatar
Oct 14, 2001
1622 posts
411 upvotes
GMA
S5 wrote:
Jan 8th, 2019 7:58 pm
4-5 years from withdrawal time is usually when it is time to start buying GICs that mature during the summer before each new school year.

For longer time horizons the new balanced ETFs from Vanguard and Ishares are great one fund solutions for RESPs. VGRO/XGRO early on, moving to VBAL/XBAL and then adding GICs.
Don't forget that they're also VCNS with an even more conservation asset allocation mix. A very lazy user could also consider the equivalents from Horizons (HBAL/HCNS) since they're Total Return meaning that there's no distributions to manage.
Deal Addict
Oct 4, 2009
2423 posts
1169 upvotes
Montreal
Thanh wrote:
Jan 9th, 2019 2:59 pm
Don't forget that they're also VCNS with an even more conservation asset allocation mix. A very lazy user could also consider the equivalents from Horizons (HBAL/HCNS) since they're Total Return meaning that there's no distributions to manage.
Not mentioning VCNS was intentional. By the time one might want such a conservative asset allocation, adding GICs with maturities that match projected disbursement make a lot more sense than bonds with 7+ years duration.

Don’t get me started on those Horizons abominations.
Deal Addict
User avatar
Oct 14, 2001
1622 posts
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GMA
S5 wrote:
Jan 9th, 2019 8:04 pm
Not mentioning VCNS was intentional. By the time one might want such a conservative asset allocation, adding GICs with maturities that match projected disbursement make a lot more sense than bonds with 7+ years duration.
That's based on your risk tolerance & investor profile. Someone else might think differently.
S5 wrote:
Jan 9th, 2019 8:04 pm
Don’t get me started on those Horizons abominations.
I get that they're not perfect (use of strange index, currency-hedging, etc.) but what makes them abominations ? While I don't use them, they're a good approach for a lazy investor who doesn't want to have to manage distributions and/or for someone who wants to simplify taxes.
Deal Addict
Oct 4, 2009
2423 posts
1169 upvotes
Montreal
Thanh wrote:
Jan 9th, 2019 10:39 pm
That's based on your risk tolerance & investor profile. Someone else might think differently.
Nothing to do with my risk tolerance or investor profile, I have no RESP and was providing general guidance to someone requesting RESP stock advice. Someone else thinking differently will not change the properties of the holdings. Holding bonds of longer duration than your time horizon isn’t a good idea, GICs are better suited to predictable disbursements.

I get that they're not perfect (use of strange index, currency-hedging, etc.) but what makes them abominations ? While I don't use them, they're a good approach for a lazy investor who doesn't want to have to manage distributions and/or for someone who wants to simplify taxes.
You answered your own question in that first sentence. Products that are overly complex, more expensive and generally structured to meet the fund provider’s needs over that of investors are abominations in my mind, others might differ in their characterization.

There’s a limit to laziness and there are no tax considerations in the context of this RESP investing discussion. I know you like to hold their better individual ETFs in some registered accounts for simplicity. My opinion is swap products should not be entertained anywhere but unregistered which is after all their raison d’être.

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