What I’m Invested in – February 2021

What Im invested in - February 2021 - featured

Investment is a key foundation of FI for almost everyone. It is the simplest and easiest way to grow your wealth long term and prepare yourself for retirement. However, everyone is different in what they choose. From individual stocks to ETFs, REITs, Bonds, and everything in-between.

So to hopefully add a little bit of clarity, and to give a starting point for people I’m going to go a little bit into each thing I’m currently invested in, and why I am.

The Accounts

To begin, let’s discuss the accounts I have my investments stored in, as this alone can be one of the most confusing parts of starting your investing journey.

I should note that I also have an RESP for my son, but I wont be including any of that because I don’t consider it as my money.

TFSA

I have two TFSA’s. One is with Questrade and is where most of my money sits. I consider this as my primary savings account or money that I can’t touch. I have had this account since March of 2020, where it has steadily grown. I’ll refer to this one as “The main TFSA”. I also have a second TFSA, which is simply a high-interest savings account with Tangerine. This is my emergency fund. Because of my age, and the amount of time I have for interest to accumulate, I like to be a lot more high-risk invested in my main TFSA, but this account is there simply for emergencies, or if I need to access the money immediately as I can move money back and forth between it and my primary chequing instantly. I’ll refer to this one as “The emergency TFSA”.

The main TFSA

In my main TFSA I Am invested in the following 3 ETFs:

VDY

VDY(Vanguard High-Dividend Yield Index ETF) is the smallest portion of my main TFSA. Only approximately 5% of my account is VDY, and I treat this as a little pick me up. VDY pays dividends every month and so it helps the mental state (at least for me) to see even the tiniest amount of cash come into my account every month.

It is primarily composed of financial institutions and energy companies across Canada, and so far has been paying out anywhere between $0.10 and $0.16 per share per month. So while not a lot it works out to about 1.56 a year (at least across the roller coaster that was 2020). This little bit of money every month usually just gets reinvested with additional contributions to increase my other holdings.

VGRO

VGRO(Vanguard Growth ETF Portfolio) is the second-largest portion of my main TFSA. This ETF is approximately 15% of my main TFSA and I will probably keep it around this level. It is primarily equities but does contain 20% bonds. Since I’ve held this ETF I have found that this addition of bonds makes both the rises and falls of the market less noticeable (as you would expect). Keeping this slight buffer does help when the market is super volatile and again for the peace of mind it is nice to see.

Unlike the high-dividend ETF above this fund is far more balanced, across both countries and sectors. Having this diversification already done means that I do not need to focus as much, or spend as much time learning about foreign markets, diversification, and everything that comes along with it. Additionally, it pays out dividends quarterly, which, while not much is still very nice to have! Especially when compared to the ETF that is the largest portion of my TFSA.

VEQT

VEQT(Vanguard All-Equity Portfolio) is what makes up by far the largest portion of my TFSA. Approximately 80% to be specific. Similar to VGRO mentioned above it is a rather diverse ETF spreading across both countries and industries. However, unlike VGRO it is 100% equities. This makes the growth potential (and the loss potential) significantly higher. Since I have many years for these holdings to grow I decided to be a slightly higher risk with the majority of my portfolio and hopefully realize larger gains over the coming years than if I were to hold an 80/20 option like VGRO.

CGX.TO

Now comes the smallest parts of my portfolio, like 2 shares small. Just this month I decided with my latest addition to the TFSA that I wanted to try and hold some shares in addition to the holding of my ETFs. Which is where Cineplex comes in. Cineplex, being the largest movie theatre chain in Canada, understandably, took an enormous hit when COVID hit in March, as their share price dropped by 75%, from $40 to approximately $10. It has stayed there ever since. However, I decided to use $20 to buy two of these shares as my fun stock. As things across the country begin reopening and studios across North America begin releasing the new movies that were put on hold in March it makes sense that Cineplex will begin reopening theatres and returning to their former state of glory.

In the best-case scenario, the stock returns to its pre-COVID levels of $40, I sell my 2 shares and make a nice $60 in profit. In the worst-case scenario, they go bankrupt and I lose $20. But that’s a chance I’m willing to take to hold some stocks and play around a little bit to learn about an area I don’t have much experience in.

Overall

Overall I currently only hold investments in one of my accounts, my main TFSA. I hold a variety of primarily ETFs, with a heavy emphasis on higher-risk equities. I do see the proportions of what I hold changing slightly. As time goes on and I begin contributing more regularly I will shift to almost entirely equity portfolio. This should shorten the length of time needed to grow to a range where I feel comfortable retiring. Even if there are some larger hiccups along the way.

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