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How to Build an ETF Portfolio at TD Direct Investing

October 18, 2016 - 3 comments

So you’ve made the decision to become a DIY investor, but there’s way too much information online to wrap your head around. Not to worry – my new series of tutorials will cut through the noise and show you just what you need to know. The first set of videos will be geared towards the novice investor who is currently investing within their RRSP, TFSA or RESP accounts. Let’s start things off with a tutorial on How to Build an ETF Portfolio at TD Direct Investing (I’ve also included some additional commentary below).


Watch those cash balances

TD’s online platform sometimes takes a moment to update the cash balances. If you are unsure whether your previous trades are being reflected in the remaining cash balance details, review the order status screen between trades, just to ensure that your trades are being successfully filled.

Avoid the quarterly maintenance fee

For household accounts below $15,000, TD Direct Investing will waive their $25 quarterly maintenance fee if you set-up a pre-authorized contribution of at least $100 per month. This one is a no-brainer – not only does it force you to systematically save, it reduces your account fees.

For smaller accounts, use index funds

Even if you avoid the quarterly maintenance fee by setting up a monthly contribution plan, it may be less costly to invest in the TD e-Series Index Funds instead of ETFs. As a rule of thumb, if you have less than $15,000 to invest, and it will likely be a few years until you have saved up this amount, avoid ETFs. For those investors with less than $15,000, please refer to Dan Bortolotti’s model TD e-Series Index Fund Portfolios on his Canadian Couch Potato blog.

For smaller accounts, use less ETFs

Although I’ve shown how to build a 5-ETF portfolio in my tutorial, you can get away with using just three ETFs to cut down on trading commissions.  Instead of holding separate ETFs for US, international and emerging markets stocks, simply hold the iShares Core MSCI All Country World ex Canada Index ETF (XAW).

Stay tuned next week when we’ll learn How to Build an ETF Portfolio at BMO InvestorLine.

By: Justin Bender with 3 comments.
  02/03/2017 12:56:16 AM
I noticed in your video, you model portfolio shows 2016, but the PDF download shows 2015. Do you have the 2016 update for your model portfolio?
  04/01/2017 3:54:14 PM
Justin Bender
@Edward: Excellent news! Glad I could help simplify the process for you :)
  04/01/2017 10:37:09 AM
Thanks so much for this, Justin! Straighforward walk-throughs such as this are a rarity in the Canadian DIY investing world. Just did my first TD ETF buy while following the video steps at the same time and it went easy as pie. Cheers!

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