Foreign Currency Exposure of Your ETFs
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- Опубликовано: 2 июл 2020
- In this video, Justin helps Canadian DIY investors understand the various foreign currency exposures of the Vanguard and iShares equity ETFs within his model portfolios (such as VUN, VTI, XUU, ITOT, VIU, XEF, IEFA, VEE, VWO, XEC and IEMG). Fluctuations in the U.S. dollar (USD), Japanese yen (JPY), euro (EUR) and Swiss franc (CHF), are all discussed in relation to the Canadian dollar (CAD).
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Resources discussed in this video:
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www.canadianportfoliomanagerb...
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- Twitter: / justin_bender
- Blog: www.canadianportfoliomanagerb...
- Podcast: www.canadianportfoliomanagerb...
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You, Dan Bortolotti, Ben Felix, and Cameron Passmore are doing so much for the average Canadian investor you guys really all deserve way more exposure than what you're current getting. Keep up the great work!!!
That's very kind of you, Tim. Thank you for your words of encouragement.
Agreed! I would like to see Justin on the Rational Reminder podcast again with Ben.
Why does pwl capital do so much on RUclips?
Great video thank you. I wish you had time to release more of these. I have dropped all of the other finance RUclipsrs out there and kept only Ben Felix and you. You guys are unbeatable.
@Julien Tousignant: I'm happy to hear I survived the purge ;) Now that I've finally set-up the home studio, I should be able to release new videos on a semi-regular basis.
Always a pleasure to see a new video from you, Justin. I have a much clearer picture of currency exposure now!
blizzard762 - I'm glad you found the video informative - thanks for watching!
Such a clear explanation of currency exposure! Thanks so much Justin, I finally feel that I understand this topic.
@steeleware - I'm so happy to hear you found the explanation useful - thanks for watching! :)
Love this type of videos!! You just gained a subscriber :) Please do more ETFs videos.
@goh jing wei - thanks for subscribing! The majority of my upcoming videos will focus on ETFs, so stay-tuned!
Love the Bill & Ted reference. Nice touch.
@R.A. - Thanks! It was most non-heinous ;)
Excellent video Justin!
@Help Me: Glad you enjoyed it! Should I be concerned about your username? Click "Like" if you want me to send help and "Dislike" if you're safe ;)
Justin, thank you so much for sharing your knowledge. For technical discussions like this one, I feel it is easier to follow with a video.
As a suggestion for content (not related to this video), I am curious to know more about the process of avoiding double tax when deciding to invest on US listed ETFs inside a RRSP. I do taxes by myself so I'd like to have a sense of the process of claiming a rebate is simple or super time consuming. If its too compoex, I'd prefer to keep stuff simple for convenience even when it's not super tax efficient.
Thank you again for your time and dedication with your audience!
Hi Bruno! Thanks for watching. You're in luck - I just recorded a foreign withholding tax video on Tuesday, so you'll have this available over the next couple months. As a quick response though, there's no tax filing requirements when holding foreign equity ETFs in an RRSP (you either have zero, one or two layers of withholding taxes applied, depending on your choice of ETF).
@@JustinBenderCPM Thanks for sharing the information and the awesome news that more stuff is coming soon. Just to give you an idea, I have a combination of GICs/ZAG/VCN/XAW (following a previous model) and I now deciding if I should adopt the light or the ridiculous model. In the podcast episode "Plain and Simple..." (33:00) you mentioned the benefits of tax optimization when adoption US-listed ETFs. I am now trying to estimate how much time I would spend on doing all this stuff. As a reader, I feel it is a lot of details to get familiar with. I am sharing it so you can have a sense of where amateur people can struggle. Thank you so much for your time.
@@BrunoAlves-uy3sl - Experts struggle with these concepts as well, so don't beat yourself up. I would only consider using U.S.-based ETFs if your RRSP is well into the six digits, and you're comfortable with the Norbert's gambit strategy to convert your loonies to U.S. dollars. The AA ETFs are the best option for most investors (they are so incredibly easy to invest in and manage on an ongoing basis), so keep that in mind when you're making your decision.
Great video Justin! Great inspiration for me and my channel 💓 love the Canadian focused approach I am also a big fan of Ben Felix and I've also made a video on his strategy
@Marco Lorenzi - glad you enjoyed the video! I'll have to check out your channel over the weekend.
Thanks for such a great explanation. I need to see a higher frequency of videos, please.
@Imran Khan: I'll see what I can do ;)
HE'S BACK
@Tim Dinh:
ruclips.net/video/UkbsYGtDB3o/видео.html
I have a question: if my currency is EUR, the ETF can be bought only with USD, but the ETF undelying assets are in other currencies (USD isn't included, let's say), then, when I sell it, all those currencies will have to be converted to USD and then back to EUR. But if I could buy the ETF only in EUR, there will be no conversion to USD, removing the currency risk of USD-EUR. So it's always more convinient to buy an ETF that can be bought in EUR. Does it make sense?
ur alive!!!
@kamehamewhat: I know, right?! ;) The goal is to be a lot more present going forward on the channel.
Hi, how do you calculate the impact of foreign withholding tax? Lets say I hold an ETF domiciled in Luxembourg at 0.05% TER (with 30% foreign witholding tax). Would it then make sense to instead hold an ETF in another domicile (like Ireland, which has FWT 0.15%) but at a higher TER, like 0.10%?
@ Multi8h - I'm not sure of the foreign withholding tax implications of your home country, but here is a white paper I wrote on how to estimate this tax drag from a Canadian perspective:
www.pwlcapital.com/wp-content/uploads/2018/06/2016-06-17_-Bender-Bortolotti_Foreign_Withholding_Taxes_Hyperlinked.pdf
I'm just going to comment to hopefully affect Google's algorithms and give more exposure to these useful videos.
@rebirthfyre - By all means! ;)
I thought you would talk about CAD hedged funds.
Soon, James Wang ... soon :)
he has a face!
@Carlos Pacheco: Took me long enough ;)