John DeGoey is vice-president and portfolio manager at BBSL. His focus is personal finance and ETFs.
Vanguard FTSE Emerging Markets All Cap Index ETF (VEE.TO)
VEE is a great and ultra-low-cost way to get exposure to emerging markets stocks. In my view, this asset class is the most under-owned in the world and well worth the volatility that one ought to expect when investing in it.
Vanguard FTSE Canadian High Dividend Yield Index ETF (VDY.TO)
VDY is finally looking like something to buy again. Once again, the cost is extremely low, while diversification, superior tax treatment and a low entry point make this worth considering.
iShares S&P/TSX Global Gold Index ETF (XGD.TO)
XGD has already had a nice run since Q4 of 2015. Many feel the pendulum swung too far on the way down and, if markets remain volatile, investors will likely seek a traditional safe harbour.
Past Picks: March 17, 2015
BMO Global Infrastructure Index ETF (ZGI.TO)
Then: $34.34 Now: $30.37 -11.56% Total return: -9.05%
iShares Global Agriculture Index ETF (COW.TO)
Then: $33.13 Now: $30.63 -7.55% Total return: -5.76%
iShares Global Water Index ETF (CWW.TO)
Then: $27.18 Now: $27.15 -0.11% Total return: +1.28%
Total Return Average: -4.51%
Traditional equity investments might do comparatively poorly over the next few years, since there is no meaningful way left to stimulate growth. Governments and households are both more stretched than ever, the population is getting older and less productive and interest rates are the most accommodative in history. Even with considerable monetary and fiscal stimulus, macro trends are causing economic growth to slow down.
With that said, there are modest opportunities in Canada, where the TSX has lagged the S&P 500 for five consecutive years; in gold, where there seems to be some volatility-based momentum; and in emerging markets, where the combined market cap of every company in the MSCI China and India indexes sums to the total market cap of just Google and Amazon.