ETF Index Investing Course

13.2. What I Invest In and Why

Useful Links:


I periodically receive questions from those taking the course whether I have changed the ETFs that I invest in since the course was originally published. It is here where I will document any changes and updates:

Fortunately in the broad-market, passive ETF investing world, updates are actually very infrequent. I still hold the same ETFs that I originally held when I started investing years ago.

With that said, there is one ETF that I have been investing in lately (just with some of the new money that has come in, while keeping past purchases intact). That ETF is called VFV and represents the S&P 500 index (the US market).

Keep in mind that VUN (what I mentioned in the video) is still an ETF that I own a LOT of, and I have NOT sold any VUN to replace it with VFV.

Both are still excellent choices in my opinion, and it can definitely be argued by some that VUN is better, while others will argue for VFV.

The main difference between the two ETFs is that VUN represents a lot more companies in the US (it follows the CRSP US Total Market Index), whereas VFV only represents the S&P 500 (which includes a bit over 500 of some of the largest companies in the US).

In theory, VUN should outperform VFV (the S&P 500) because VUN includes smaller companies which tend to grow faster than established older companies where it's harder for them to move the needle, and many are issuing dividends as opposed to investing as much into growth as some of these smaller companies.

It is for the reason that chose VUN over VFV in the past (i.e. I wanted the higher probability of receiving higher growth). For the past while however, VFV has actually been outperforming VUN, and so I figured it doesn't hurt to have some of my portfolio focused around the S&P 500.

Please don't stress-out about this decision for your own portfolio. Depending on who you ask, you'll get some that are all about the S&P 500 (VFV), while others are all about the CRSP US Total Market Index (VUN). You're basically just picking 1 index over another, but they are both excellent indexes for the US portion of the portfolio.

As an aside, VFV also has a lower fee (MER) compared to VUN. It's a point worth mentioning but keep in mind that with index ETFs like these, you're paying rock-bottom prices on fees so I wouldn't get too hung up on this.

The bottom line is that VFV has been outperforming lately and it has a lower fee (even though theoretically VUN should be the one that outperforms long term).

I hope that helps, and let me know in the comments if you have any follow-up questions.

UPDATE 2: A common question that often comes out of learning about all this is "What ETFs should I be holding in my RRSP vs TFSA vs my taxable account". I get asked this a lot so I actually went ahead and wrote a giant guide on the subject. Below is the link to the full guide, and if you have any questions about it, feel free to ask in the comments and I'll gladly help.

What Investments to Hold in an RRSP vs TFSA vs Taxable Account (Asset Location)


  • JC Pasche

    Reply Reply December 27, 2023

    I currently have 200,000 in CDN non-registered
    10,000 CDN + 50,000 in TFSA
    My wife has 5,000 CDN + 55,000 USD in TFSA
    65,000 USD RRSP
    340,000 USD in LIRA

    I’m wondering if I were to invest similar to your allocation, they are CDN ETF’s so would I convert $ to CDN to invest in those or are there equivalent USD ETF’s to use?

    Thank you,


    • By Kornel Szrejber

      Reply Reply January 2, 2024

      Hi JC. From a fee and tax minimization perspective, if this is what I had in my own accounts, I would first use your USD cash to buy USD listed ETFs for the US equities portion of your portfolio. This way you don’t have to deal with currency conversion costs which can be substantial. When I have US cash, I personally buy VTI which is a US listed ETF so it’s in US dollars. VTI is a Vanguard US total market index ETF. This ETF would be part of your US stock portion of your portfolio. Here is the link:
      Of course do your own due diligence as I don’t know all the details of your situation, but this is what I do personally when it comes to using US cash that I have to invest. Don’t use Canadian cash to buy VTI since then the brokerage will convert your CAD to USD and then you’ll pay a crazy amount in currency conversion costs.

      The other important thing to consider is that when you are holding a US listed ETF like VTI in your RRSP, you are exempt from the withholding tax that the US charges on those US dividends. Therefore, all of the VTI that I hold is within my and my wife’s RRSP. This way we get the US exposure, we don’t pay withholding tax, and the MER on the ETF is very low.

      Of course, don’t just always put all your USD into a US equity ETF like VTI. Remember that you need to stick to your asset allocation. For example, if 90% of your portfolio was in US dollars, you don’t put 90% of your portfolio in an ETF like VTI since then you’d be overweight on US equities.

      Personally what I like to use for my portfolio these days is the allocations that XEQT uses. Here is the link:

      You’ll notice that they have 45.32% allocated toward US equities. Other asset allocation ETFs like this have similar amounts in the US (ex. VEQT, ZEQT). So basically 3 of the biggest ETF providers in Canada have concluded that they feel this is a good amount for a Canadian to have in US equities, and so I go with that in my own portfolio (the 45.32%).

      Regarding the last part of your question: When comparing and doing your asset allocation calculations, you should be using the same currency. Personally, I always convert my USD to Canadian dollars in a spreadsheet or using Passiv to see what my portfolio is and its allocation based on Canadian dollars.

      You typically want to limit currency conversion whenever possible since no matter how efficiently you do it, there’s are always fees/transaction costs of some sort, so I personally only convert if I absolutely have to.

  • Kari K.

    Reply Reply June 13, 2021

    Hi Kornel! I’m really enjoying your Investing Course and have been recommending it to friends already even though I’m not finished watching all the videos. Thank you so much!

    My question is in regards to investing via the Smith Maneuver. As I understand, I need to use funds borrowed from the HELOC portion of the readvanceable mortgage to invest in dividend- or income-producing things such as rental real estate or equities within a non-registered investment account. Do the funds you speak of in the course (XIC, VUN / VFV, XEF, XEC) qualify? Am I correct in understanding that these funds all produce dividends? I’m intending to open a “margin” investment account and I want to make sure that I’ll be eligible for the tax benefit when purchasing these funds.

    Thanks in advance!

    • By Kornel Szrejber

      Reply Reply June 24, 2021

      Thanks so much for recommending the course to friends. I really appreciate it!

      The ETFs that I mention in the course all produce dividends (XIC, VUN/VFV, XEF, XEC).

      XIC has an extra layer of complexity because it generates a dividend tax credit when held in your taxable account (i.e. A margin account in Questrade). The rest of the ETFs just get treated as regular income in your taxable account when it comes to your taxes (since they produce international dividends).

      I’m not an expert on the Smith Manoeuvre although I definitely would have strongly considered it if I knew what I know now, back when we had a mortgage.

      Just remember that you have to be VERYcomfortable with very large volatility because you are using leverage, which amplifies your gains, but also your losses when the markets take a dive.

      The most knowledgeable person that I know about the Smith Manoeuvre in Canada is Ed Rempel over at He’s also got an accounting background.

      If I was going to do the Smith Manoeuvre myself, I would personally just reach out to him and try to hire him to give me advice on how to do it properly. One thing that I know about the Smith Manoeuvre is that you have to be VERY careful with how you do it, because if you do it wrong, then the CRA can totally go after you for taxes owing. So, even if you decide not to reach out to Ed, at least read the Smith Manoeuvre content on his site. Here is a guide that he wrote:

      He answers comments on his blog too, so you can try asking him a question within that article too.

      Another resource for you is this book:
      It’s written by the son of the guy that actually came up with the Smith Manoeuvre.

      Full disclosure: I haven’t actually read the book myself, but it does have good reviews and it’s written by the son so I figure it’s a pretty good resource, especially since the CRA isn’t going to publish a book on how to do it 🙂

      I hope that helps!


  • Jenny

    Reply Reply May 20, 2021

    Hi Kornel, I really enjoyed your course and finally have the courage to start investing. I have invested in some of the ETFs that you invest in however I wanted to ask you about ESG ETFs. I am really into the environmental, social and governance values and was wondering if you have done any research into these?

    Thanks in advance for any help/info you can provide


    • I have looked into this and have decided that I would rather take some of the profits from my broad market index investing and put that money directly into charitable causes (non-profits) that I want to support, as opposed to investing in ESG ETFs.

      Below is an excellent episode that takes a look at the numbers behind ESG investing. The bottom line is that the expected returns for ESG ETFs are generally lower than just doing broad market index investing. Therefore, you have to ask yourself whether you are okay with potentially receiving lower returns long term, in exchange for investing in ESG type ETFs.

      By doing ESG investing, you are contributing to making the cost of capital lower for ESG companies, and making the cost of capital higher for non-ESG companies. In a way, this may also incentivise the non ESG companies to be more socially responsible (hopefully) as they want that lower cost of capital, which they can then use to invest and grow their business. So my view is that doing ESG investing is great (from an ethical perspective), but you have to be okay with potentially lower returns on your portfolio.

      The alternative, is that you can just do broad market index investing (like shown in the course), and then if you want, you can take as much of those profits as you want and donate them to the causes that you believe in (giving the money to a non-profit as opposed to a for-profit ESG company). A direct donation is a more direct way of helping the cause vs making the cost of capital lower for ESG companies.

      Definitely I have nothing against ESG investing and I’m really glad that it exists. It’s just really a personal preference on how you want to make an impact: ESG investing vs donating to charities, or you can do both!

      The other thing worth mentioning is: Make sure that the ESG ETF that you choose to invest in actually fits your definition of ESG. There are a bunch of ETFs on the market that claim to be ESG, but they may not actually fit your definition of ESG.

      People tend to have different definitions of what is ethical vs what is not. For instance, some people are not that against oil companies but are very much against medical research companies that use stem cells. Others are very against anything that can harm the environment, but are more okay with different types of medical testing. In other words, before picking an ESG ETF, make sure that you actually see what companies they hold so that you can decide for yourself whether that fits your definition of ESG.

      I hope that helps. Here is an excellent resource for you where they’ve actually crunched the numbers on this:

      The ESG section in the episode starts at: 12:10. Here you go:

  • Jacqueline

    Reply Reply April 1, 2021

    Hi Kornel, I am ready to start buying some ETFs but see that the prices on the ones you suggested are at an all-time high, is it better for me to wait till they lower a bit? I know that it is good to invest monthly but just not sure now is the right time since they are at their highest in 5 years!

    • By Kornel Szrejber

      Reply Reply April 10, 2021

      Hi Jacqueline. Great question. Based on the research that I’ve done, the expert interviews, and what I personally do, you are more likely to come out ahead by investing as soon as possible (thereby increasing your time in the market), rather than waiting for a slight dip or significant decline before you invest the money.

      Generally, the market goes up roughly 2/3rds of the time. In other words, the odds are on your side that the longer you are in the market, the higher your returns are likely to be. Of course, there is no guarantee when it comes to investing in equities and so while you may get unlucky, the chance of that happening and it actually impacting your net worth significantly are relatively small.

      Another way to look at it is if you can own something that you know is going to go up in value on average, wouldn’t you want to own that thing as soon as possible?

      If you are feeling nervous about deploying your cash due to all time highs (which is totally understandable and many people are), one good option to help reduce your anxiety around it is through dollar-cost-averaging. This means taking the cash you have, splitting it into equal parts, and then investing 1 part every x weeks or months (the x is whatever timeframe makes you comfortable, but remember that the longer you spread it out, the more likely you are to miss out on growth so I would make this as short as possible, while still making you comfortable).

      Historically and statistically speaking, doing this approach is likely to hurt the growth of your investments a bit (i.e. you are more likely to be better off investing it all at once as a lump sum), but that may be a price that you are willing to pay for the piece-of-mind and anxiety reduction.

      If you want to go into the weeds on this a bit and take a look at some of the research that was done, here are some great resources to help you.

      1. This video is from the guys at PWL Capital (particularly Benjamin Felix) and they do some great research. This link will take you right to the part of the video that talks about whether you should wait for a dip before buying in or just get in the market ASAP with any cash you have. Some parts get a bit technical, but it should help with the piece-of-mind:

      One very interesting finding in their research, was that they found that an all time high followed by a decline of 10% or more within 12 months (i.e. what you are worried about) only happened less than 3% of the time across all the indexes they were looking at (internationally).  

      2. The same researcher (Benjamin Felix) also wrote a white paper on the subject of dollar cost averaging vs lump sump investing (i.e. if you have a lump sum of money just sitting there, should you invest it gradually or all at once). The conclusion from him, Vanguard, and every expert that I’ve talked to about on the subject is that you are better off doing it all at once.

      I encourage you to check out his paper here:

      For easy reference, if you want to jump straight to his conclusion, it’s the 4th last page of that paper.

      3. As a bonus, here’s another source discussing lump sum vs dollar cost averaging. It’s from Vanguard who is also highly respected in this field, and they have done their own research on this too:

      I hope that helps 🙂

  • Tsering

    Reply Reply March 30, 2021

    Hi Kornel,

    Thank you for the great course. I have learned a lot in the last 2 weeks since starting the course. The section on Asset Allocation is by far my favourite and has helped me give my plan a solid direction.

    I have a question regarding buying US stocks in US dollars through questrade. Currently, I have some US dollars available to me.

    1. Looking specifically at my TFSA, wouldn’t it make more sense to buy US growth stocks such as Apple stocks in USD instead of in Canadian dollars? Since I will have to pay the 15% witholding tax for holding US stock in my TFSA anyway, holding US stocks in US dollars would minimize the extra cost that I would have paid in currency exchange or fx fee, right? Plus having it in my TFSA means that I leave the option of withdrawing money if I ever need it without getting dinged for taxes. Am I missing something else in my reasoning here?Your thoughts?

    Thank you!

    • By Kornel Szrejber

      Reply Reply April 1, 2021

      Thanks for the feedback! I really appreciate it.
      To answer your question:
      First, here is a good article by Dan at MoneySense that you may find helpful: Link
      Personally, I would always buy US stocks or US listed ETFs using USD, which I converted using Norbert’s Gambit. If you are already holding USD then great, use that to buy your US listed stocks and/or ETFs. The main thing that I always keep in mind is that I never want to buy an investment that’s in USD by using Canadian dollars. This is because Questrade (or whatever broker you’re using) will convert that currency for you automatically, and brokerages are generally known for giving unfavourable exchange rates (i.e. this is one of the ways they make money).

      So to answer your question: Yes, if you have USD and want to buy something like Apple stock, or a really good ETF like VTI (this is the one that I buy in my RRSP) then use those US dollars for that. This way you are buying an investment that is in US dollars, using your US dollars.

      Lastly, yes, by having it in your TFSA, you can withdrawal at anytime without getting hit by taxes.
      One thing to consider is if you do have USD, then what I personally do is keep that currency in my RRSP and buy VTI (the US index). This way you avoid the withholding taxes and get a lower MER vs something like VUN.

      I hope I explained that ok. As an aside, it seems like you already have a handle on withholding taxes, but in case you want to read up on it (or for anybody else wondering about this), here is the link to an article that I wrote about it as I get asked that a lot:
      What Investments to Hold in an RRSP vs TFSA vs Taxable Account (Asset Location)

      • Tsering

        Reply Reply April 8, 2021

        Hi Kornel,

        Thank you for you response and reference to helpful articles. I am definitely planning to do as you suggested and keeping my USD for US stocks and ETFs and growing the USD in my RRSP.

        I have 2 questions which indirectly relates to investing and is about FIRE which you successfully executed and have been a part of. I am interested in the FIRE movement and hence have started investing. This is what I hear a lot. ” Determine your FIRE number (the amount of money you need invested) based on how much you think you’ll need to comfortably retire. Once you have that amount invested, apply the 4% withdrawal rate rule to sustain your early retirement”.

        My questions are:
        1. Once you have that fire number amount invested and are ready to withdraw your 4%, which investments are these withdrawal coming from- efts? stocks?checking account?TFSA? I cannot seem to find any information or resources that talks about what happens AFTER you reach your FIRE number and how to proceed when it is time to start withdrawing.

        2. If the assumption is that even at 4% withdrawal rate, your investments will keep growing for you to extract the 4 % annually, doesn’t it go against the principle of ‘investing is for long term’, since we keep withdrawing annually? How will the money keep growing if we are taking it out?

        I understand that this isn’t an investing course related question but thought I ask since you are living the FIRE life.

        Thanks again!

        • By Kornel Szrejber

          Reply Reply April 12, 2021

          Great questions.

          Regarding question 1, below is a link to a really in-depth guide on this which I was involved in creating. I was actually used as a case study in it, where I go into detail on how I actually do it:
          Withdrawing from your RRSP, TFSA, and Non-Registered Accounts for Retired Canadians

          Regarding question 2: Usually when you hear “Investing for the long-term”, the way that I’d interpret that is you buy the investments, and then you hold them long term. You will sell portions throughout retirement so that you have money to live, but you are not buying some investments temporarily, speculating that it will drastically go up in price within a short time span, and then selling it and then trying to find the next hot stock/investment. So really, the “long term investing” refers to a buy and hold strategy, as opposed to speculation and frequent trading (like day trading or short term stock picking).

          To answer the other part of your question “How will the money keep growing if we are taking it out?”: Let’s say that you are an all equity investor. In this case, I would assume 8% return per year on average, long term. If you have some bonds in there, that may fall to 5%-6% per year. If you are only withdrawing 4% of your portfolio per year, then basically your withdrawal is less than the amount of money that your portfolio has grown. So, you are just taking out a portion of the growth at that point.

          To give you a real life example, when I take out money from my portfolio (I’m currently semi-retired), anything that I do take out is from the growth so I never actually touch my principle (i.e. the money that I actually put in). This way it’s very sustainable as I’m never digging into that principle that is generating those returns.

          Eventually, unless you want to leave a big estate to your kids for example, you actually do want to start withdrawing more so that you are digging into your principle. To give an extreme example, if you are 80 and have 3 million dollars, then do you really want to just live off the growth at that point? You’ll probably die in the next 20 years so you might as well start spending some of that principle too (again, unless your goal is to leave a big estate for the kids, donate to charity, etc.). In my case since I retired in my 30s, I need that money to last 60+ years potentially. This is why I make sure that I don’t touch that principle as it needs to sustain me for that 60+ year period. Eventually as I get older, I will start digging into the principle so that I’m not that 80 year old with too large of a portfolio.

          The examples I gave are a bit simplified because we also have to account for sequence of returns risk (and that’s a whole separate subject). But in terms of answering your questions, that is basically how it works at a high level. In other words, you are taking out less than what the growth was, and the growth that you leave in continues to grow and compound which further increases your net worth.

          I hope that helps. Let me know if something wasn’t clear and I can elaborate.

          • tsering kongsa

            May 9, 2021

            Thank you very much Kornel for the link and your detailed explanation! Much appreciated! Onward I go!!!

            Thank you!

  • Kevin Maher

    Reply Reply February 28, 2021

    Hi Kornel, would it be wise to have both VFV and VUN in my portfolio or should I pick one or the other? Thanks.

    • By Kornel Szrejber

      Reply Reply March 8, 2021

      Hi Kevin. Just pick one. VUN is the one that I personally like more because it includes small cap companies which have a higher expected return long-term when included as part of your US allocation. If you want to learn more about each of them and want another unbiased opinion, you can also check out 5i’s Q&A section to see answers for those ETFs. You can also ask their Analysts to get their take on those or any other ETFs you’re considering. You get 1 free question credit with the free trial at this link: You’ll get a free 1 year of MoneySaver Magazine using that link too. Just an extra good resource that doesn’t try to sell you overpriced mutual funds. I tend to always go on the 5i Member’s area if I’m ever considering a particular ETF just to get their opinion, so definitely feel free to check it out if you are having trouble deciding or want more information.

  • David

    Reply Reply August 26, 2019

    Great series but one thing I’m confused with and that’s that I expected you’d be showing how to actually make a purchase in questrade. That’s the thing I’m most confused and insecure about. For me this is so incredibly abstract that I’m very reluctant to open up an extremely complicated app and put my savings at jeopardy that way. I have done a lot of research but I really would like to see how to actually make a purchase on questrade. Can you make a video about that? I think I’m probably not the only one who need help with that.

    • By Kornel Szrejber

      Reply Reply August 30, 2019

      Hi David.
      Did you end up seeing the rest of the videos? I definitely show how to actually buy via Questrade, and I do several transactions using my own money. I’m wondering if maybe you wrote the question in the comments before viewing that video?

      Can you please let me know? I want to make sure you have all the questions answered. If you did see all the videos and you are still not sure about something, then definitely let me know and I’ll be happy to cover it for you. I can always do more recordings for you too if needed, if you feel they are missing something.


  • Josh

    Reply Reply October 19, 2017

    Hi Kornel,

    I love your videos, thank you so much!

    Quick question – I’m really really new to this and I’m trying to figure out what combination of ETFs to put in my portfolio, but at this point I’m wondering if it’s a better idea just to choose one of the model portfolios (e.g. created by Canadian Portfolio Manager) and go from there. I feel like I’m paralyzed by all the options and don’t have the confidence to “pick” the right combination.


    • By Kornel Szrejber

      Reply Reply October 22, 2018

      What you’ll find is that there is a lot of overlap between the different model portfolios that you see online (the ones from the reputable sources at least).

      You’ll typically find 1 ETF for Canada, 1 for US, 1 for international, and 1 for bonds when looking at a model portfolio. You’ll also notice that most of them are either from Vanguard or iShares/Blackrock. I personally own ETFs from both. Each provider typically has an ETF that follows the same index. So, for example, Vanguard has one that follows the S&P 500 and iShares has their own that follow the S&P 500.

      The sheer quantity of ETFs can make it overwhelming for sure, but when you look at what each of the portfolios contain, you’ll notice that it typically comes down to the above, and the differences between each are usually pretty small.

      As an aside, another allocation that I like is this one from Vanguard:

      You can model that portfolio by buying the underlying ETFs, or just buy that ETF if you don’t want to worry about rebalancing. There are some pros and cons to doing this so let me know if you’re interested and I can outline them. I’ll be doing a post on it soon as it’s a common question.

  • Paul

    Reply Reply January 7, 2017

    Hi Kornel,

    This has been a great course – thanks for taking the time to record these videos! I’d like to ask if you have any thoughts on different TFSA and RRSP portfolio make-ups. On having identical ETFs purchased in each account, or, for example, to have XIC in your TFSA, and VCN in your RRSP, etc., to have both funds working for you.



    • By Kornel Szrejber

      Reply Reply October 22, 2018

      Great question Paul!

      When I first started investing, I kept the ETFs evenly spread between the TFSA and RRSP. This kept things easy, and is really good if you’re just getting started (except for bonds, I would put those in RRSP right from the start).

      Eventually, our RRSP and TFSA got maxed out, the portfolio got large, and I was no longer a ‘beginner’ so I started seeing if I could optimize things even further.
      In terms of optimization (and what I do these days), is I actually use an advanced technique called Norbert’s Gambit to cheaply exchange currency, and then buy the VTI ETF within my RRSP.

      The reason for this is that there is a tax treaty between Canada and the US where if you hold the right type of ETF, you become exempt from the dividend withholding taxes that get applied to your US ETFs. The main thing here is that it has to be in your RRSP and it has to be the right ETF (for example, I only buy VTI which you have to buy in US currency). To pull this off properly, you have to be able to exchange currency cheaply, and Norbert’s Gambit is the technique to do that.

      After years of investing like I show in the course, I only recently transitioned to using the RRSP specifically for US ETFs using Norbert’s Gambit. This is DEFINITELY not a beginner technique, and it’s only something that I would suggest looking into and considering once you have enough experience under the belt, and once your portfolio is big enough to make it worthwhile. In our case, we recently sold our rental property which resulted in lots of cash to invest, and that drove me to start using this technique.

      If you hold bonds, RRSP is a better place for them than a TFSA because historically equities have outperformed bonds and therefore if that was to continue, you want whatever grows the most to be tax free. For example, why would you want ~2% interest on bonds tax free when you can have equities in there growing at 8%.

      I’ll be doing a guide on Norbert’s Gambit in the future, so let me know if you have any follow up questions about it and I’ll be sure to include the answers there too.


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