Investing

Newbie investor...

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  • Oct 28th, 2013 8:41 am
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[OP]
Newbie
Apr 8, 2013
9 posts
1 upvote
Scarborough

Newbie investor...

So this is the first time that I am investing and had a couple of question. I recently invested my money in TD's Mutual Funds (TD US Monthly, TD Monthly, and TD Comfort Balance). I also started reading some posts and it seems like everyone is recommending the CanadianCouchPotato strategy. From the Morningstar Portfolio the YTD of my current investment is 9.13 while the CanadianCouchPotato (Uber-Tuber) is 10.09. So my questions are:

1. Should I stay with my current investment or switch to the Uber-Tuber?
2. Are MERs already deducted from the YTD? If not, when are MER collected?
3. If its better to switch, Questrade or TD Waterhouse?

Due to some circumstances, my risk tolerance right now is low. I might consider for investment of medium risk in a couple of years, but right now I would like something that will guarantee me at least the return of my investment. Current investment is >100K and I have no plans to use this money for the next 5 - 10 years. Any suggestions?
14 replies
Newbie
Jul 16, 2013
19 posts
CHESTERMERE
As we know that investment plays a very important role in our life so at the time of investment we should research about all the things about our investment like what is the probability their of increment and how much % you will get return from that type of investment.
According to the present market condition professional investors advised that you should invest on commodity like silver and gold but give more preference to Silver because it is very cheap as compare to Gold and the chance of getting profit in this commodity is very much greater then gold. If your amount is not so much then you can also invest it in silver coins that are also a great option. For more information you can visit:- http://thetroyounce.com/catalog/silver/ ... ds-bullion
Deal Addict
User avatar
Dec 26, 2010
1736 posts
774 upvotes
Calgary
1. I don't like what you're doing now. You don't need the money for 5-10 years, yet you're holding monthly income funds. Doesn't make sense.
2. MERs are built into the price of the fund. So at the end of each day when the price is determined the MER is deducted off. MER is a year rate, so it's broken down into something daily to deduct.
3. No one can really tell you what to do. There's plus and minuses to both. You can't stick with your "current investments" as noted in point 1 if you go to Questrade.

If you're low risk tolerance and want a guaranteed return, sell everything you have now and put it in a GIC because that's the only way to guarantee it. A "couple of years" of medium risk doesn't change anything.
Indexer, non-yield chasing, low cost, broad based, as simple as possible investor.
[OP]
Newbie
Apr 8, 2013
9 posts
1 upvote
Scarborough
wm009 wrote: 1. I don't like what you're doing now. You don't need the money for 5-10 years, yet you're holding monthly income funds. Doesn't make sense.
2. MERs are built into the price of the fund. So at the end of each day when the price is determined the MER is deducted off. MER is a year rate, so it's broken down into something daily to deduct.
3. No one can really tell you what to do. There's plus and minuses to both. You can't stick with your "current investments" as noted in point 1 if you go to Questrade.

If you're low risk tolerance and want a guaranteed return, sell everything you have now and put it in a GIC because that's the only way to guarantee it. A "couple of years" of medium risk doesn't change anything.

The reason I am holding the monthly income funds and comfort balance is because it was recommended to me when speaking with a financial adviser at the bank. The reason for the post was to see if I would be better off following the Canadian Couch Potato strategy than maintaining the current funds I have. Or other advise on how I could better invest my money.

I think i might have used some words incorrectly, but I am willing to take some losses as long as in the end (10+ years) I will still make a profit out of my investment. I also meant that in a year or two, I might start investing in riskier investment (just to see if I could retire earlier :lol :) . I think I should've written my risk tolerance right now is low-medium (a little more towards low) and in a couple of years I would probably be more medium risk tolerance. The reason being is that I've only taken a couple of courses in Finance so I only have very basic knowledge right now, but will be researching more about investing.
Deal Fanatic
User avatar
Jun 19, 2009
6133 posts
1980 upvotes
Scarborough
The Uber Tuber is a bit too convoluted for my tastes, stick with the Complete Couch Potato. If your risk tolerance is low, allocate a larger portion of your portfolio to bonds/fixed income/GICs but remember that risk and return and related.
Jr. Member
Oct 28, 2012
114 posts
32 upvotes
Toronto
I recommend getting out the the TD funds. The MERs are in the range of 2% whereas the couch potato portfolios will reduce your costs to less than 1% and possible less than 0.5%. The Uber-Tuber is not a bad portfolio but will require some work to balance/rebalance it.

If you stay with TD waterhouse you will pay $9.99 per trade (buy or sell). Questrade will allow you free purchases of ETFs and $4.95-9.95 commission upon sale. If you are planning to add more every month to your portfolio questrade will save you on commissions.
[OP]
Newbie
Apr 8, 2013
9 posts
1 upvote
Scarborough
whirlwinds wrote: I recommend getting out the the TD funds. The MERs are in the range of 2% whereas the couch potato portfolios will reduce your costs to less than 1% and possible less than 0.5%. The Uber-Tuber is not a bad portfolio but will require some work to balance/rebalance it.

If you stay with TD waterhouse you will pay $9.99 per trade (buy or sell). Questrade will allow you free purchases of ETFs and $4.95-9.95 commission upon sale. If you are planning to add more every month to your portfolio questrade will save you on commissions.
I read somewhere that if I have >25K, the fees at TD Waterhouse will be waived, or did I read that wrong?
Jr. Member
Oct 28, 2012
114 posts
32 upvotes
Toronto
http://www.questrade.com/trading/services/free_etf

compare that to free ETF purchasing and $0.01/share trading ($4.95 min/$9.95 max)

http://www.questrade.com/pricing/commissions/stocks

So if you added to your portfolio in a six-fund portfolio, that would cost about $60 per month with TD Waterhouse. Over 12 months that would be $720.

With Questrade it would be free.
[OP]
Newbie
Apr 8, 2013
9 posts
1 upvote
Scarborough
whirlwinds wrote: http://www.questrade.com/trading/services/free_etf

compare that to free ETF purchasing and $0.01/share trading ($4.95 min/$9.95 max)

http://www.questrade.com/pricing/commissions/stocks

So if you added to your portfolio in a six-fund portfolio, that would cost about $60 per month with TD Waterhouse. Over 12 months that would be $720.

With Questrade it would be free.
So you are saying TD Waterhouse charges $9.95 every month to maintain an ETF? Not just a one time fee for the transaction?
Deal Expert
Mar 25, 2005
22399 posts
3277 upvotes
blitz31 wrote: So you are saying TD Waterhouse charges $9.95 every month to maintain an ETF? Not just a one time fee for the transaction?
I think he was referring to buying 6 ETFs each month as a contribution.
Deal Addict
Jul 23, 2007
4766 posts
3860 upvotes
blitz31 wrote:
Due to some circumstances, my risk tolerance right now is low. I might consider for investment of medium risk in a couple of years, but right now I would like something that will guarantee me at least the return of my investment. Current investment is >100K and I have no plans to use this money for the next 5 - 10 years. Any suggestions?
Knowing some market history, it's impossible to say that you're guaranteed to get a positive return on your investments. What is guaranteed is that your financial advisor at the bank will still be making money off you and other clients, no matter which direction the markets take.
Jr. Member
Oct 28, 2012
114 posts
32 upvotes
Toronto
Stryker wrote: Knowing some market history, it's impossible to say that you're guaranteed to get a positive return on your investments. What is guaranteed is that your financial advisor at the bank will still be making money off you and other clients, no matter which direction the markets take.
Exactly. Which is why you should minimize fees, MERs and commissions.
Deal Addict
User avatar
Aug 1, 2007
1479 posts
246 upvotes
I think you can still hold those funds at Questrade - you can probably transfer them over for free. Buying new funds cost 9.99 per transaction though. If your account size is large enough, they'll refund part or all of the trailer fee that's built in so the MER could come down by up to 1%.

Another option could be to convert your account to an TD e-series or TD Waterhouse account for cheap e-series funds (with e-series account you only have access to the TD e-series funds; TD Waterhouse gives you access to just about everything).
Sr. Member
User avatar
Jun 27, 2007
579 posts
112 upvotes
Toronto
Hi blitz31,

I’m John from Questrade and I’d be happy to answer some of your questions.

If you are looking to switch to a couch potato strategy, then Questrade may be a good fit. ETFs are commission-free to purchase and you only have to pay commissions when you sell your ETFs. Take a look at our website for more information on our commission fees.

There are also a variety of promotions available for opening a new account.

Let me know if you have any questions.

John – TeamQuestrade,
Questrade, Inc.

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