Canadian Banks | ETFs or Individual shares?

[@beaviswealth]

📈📚 As always, if you're a beginner to the Stock Market in Canada and you're looking for a step-by-step blueprint on how to get started... Find out more about our Investing Academy here - bit.ly/theinvestingacademy

[@atio5491]

Brandon, watch the video uploaded, the first 30seconds. There’s a blackout.

[@jeffshepherd6077]

Marc’s level of professionalism and presentation skills are amazing! As always, thanks for the great content.

[@kelleyhaldorson209]

I am currently using the ZEB ETF but during my research I was a little surprised at the lower yield as well and wondered at it. If I remember correctly I think it is based on when the numbers get derived. The ETF has old information basically and the yield number is trailing 12months or something. I can't quite remember the explanation I was given at the time, but it did put my mind at ease and made sense. I couldn't pick the best one and I have a small account so for me the ETF made more sense.

[@MTN99999]

I own BNS Love it bought it around the crash and keeping it for long term going to add RBC Next when I get a better entry point if it ever DIPS !

[@rajbhatnagar1722]

This was exactly what I was looking for! I'm convinced individual stocks are the way to go

[@zuberstar]

i use a combination of the 2 and I do enjoy my monthly as well a quartly dividends.

[@anasbenmokhtar9933]

Thank you for your video. As you mentioned the sum of dividends made from buying individual stocks are higher than the ETS’s “distributions” that’s a big down side of ETFS. ETF’s lower distributions yield and MER cost makes them actually mutual funds of average total 1.5% cost of operation. In summary, in my opinion, if you buy individual stocks you will save at least 1.5 % of income

[@zampej963]

Marc , you are a natural . You are an asset to this chanel

[@beaviswealth]

Thank you very much. That’s kind. - Marc

[@fredintoronto]

I own a basket of BNS, TD and RBC currently weighted at 40%, 36% and 24% respectively in an RRSP account. Probably hold tight with these shares for the next few years.

[@eagerbeever22]

I own EQB.TO, TD.TO, BNS, & a bit of a CM so I like stock picking . RBC almost always trades at a premium so avoiding it unless it comes down to my level of comfort. EQB has been the greatest performer for me.

[@jfrunnerCanada]

RBNK and ZEB have very similar performances (1 month, 6 months, 1 year, 5 years, since Covid crash)… I thought the difference would be bigger… I have owned the 6 banks for years, bought after the crash in 2020, and will keep them forever! I did not know the dividends of these funds were lower, and not an average. VERY strange and disappointing!! It is another deal breaker not to take those funds. Plus I own Manulife and Power… hand picked financials with great dividends too! 👍🏻🤓

[@lsrasr158]

I own all 6 of the big canadian banks. have owned them for years dripping the dividends until I recently retired. the bank stocks are a foundation of my portfolio. started doing some bank etfs investing for larger dividends less capital appreciation. What are your thoughts on the ZWB, SBC and BK. Thanks for the informative video.

[@FandomFinance]

ZEB ROCKS!!!! Telling my wife while watching “he better say zeb” haha. Increased its dividend recently 20%. ZEB had a mer of .60% last year, good to see it come down 50%.

[@SuperKamiNeko]

I use ETF for banks. I used to own banks individually and then I decided to lower the number of tickers in my portfolio. For investing small amounts every 2 weeks, it's good because it allows me to spread my money over more tickers.

[@LATINLUVAH]

This is the same strategy I’m thinking to take, but I’m curious; how many ETF’s should I aim to buy per ticker?

[@miked1102]

I have a two banks in my portfolio which cover two different dynamics in areas of operation. One bank with a diverse area of the Americas and one bank that tends to be well exposed to the US. Another item is to hold preferred shares in banks. Banks with operations in diverse areas is like being in an ETF with no fees. And make sure to take advantage of the DRPP plan.

[@scotts1882]

The only bank i own right now is none of the big ones its CWB its been a little rock star for me the last 2 months. With their growth in Ontario i thought it would be a great play since theyre exposing themselves into a bigger market out of westen canada

[@arigutman]

Thank you for the video, a great question to discuss.. During these market conditions, and dependent on the type of investor someone is, both is an option to explore.. I have been dollar cost averaging into VTI during this volatility, but way too hard to not scoop up financial industry leaders as well as they are trading well below their fair values! The key is to look 2 to 5 to 10 years out and ask where will the investment be?

[@willkeen5010]

Agree with you on the fees so I like to purchase individual blue chip securities. Although I will say, ETF fees very small compared to say mutual fund fees that some are in the 2% range. Canadian Bank stocks are wonderful and banks are so profitable because of some of these fees, neat little circle I guess you could say. Thanks Marc for your insight, you really explain everything so well.

[@tomigeorge]

I like to have a mix of the overall canadian market XIC, and ZWB covered call Canadian bank etf. XIC is heavily weighted in banks and doesn't have limited upside potential and ZWB pays a yield higher than the individual bank stocks currently, and on a monthly basis.

[@James_48]

Yeah, but if you compare total return of ZWB to any of the big banks you’ll find it’s considerably lower. It gets much worse over time. Check out portfolio visualizer to confirm. Of course, if you are using that income to live, and not reinvest, that’s different, but make sure you’re getting a “dividend raise” every year to keep up with inflation.

[@sdandrea5245]

I believe the ETFs dividend yield is a weighted average of all the individual yields for the component holdings, and that is why it does not match the bank yields. I plan to try running the numbers to see if this is the reason.

[@beaviswealth]

Thanks for sharing your thoughts. Would be interested in your analysis.

[@KimonoEtrange]

What do you think of all in one ETF like Blackrock XGRO or VGRO from Vanguard?

[@LATINLUVAH]

The Vanguard is looking realll nice.

[@CanadianDividendInvesting]

All good options

[@CanuckDividends]

Thanks for the comparison of ETF to individual stocks. Great inf Interesting to see the difference in dividends

[@robertotorres2087]

Amazing video for beginners just like myself. Thanks a lot for sharing this highly valuable knowledge and experience!

[@bobmac6682]

Thanks Marc - excellent presentation. Could you talk about covered calls ETF's in a future show. Also, I have looked through KZbin for investing in RIF's, and found nothing on investments. What investments would you suggest for an elderly investor who wants minimum risk?

[@James_48]

My opinion is that covered call ETFs can boost your passive income but when you compare with total return against the names they hold they don’t usually measure up.

[@Adrian-cn5rk]

If you can do the research, keep up with your individual stocks, and any news on them. Then individual stocks. If you're a passive investor and can't be bothered with the research ETFs and Index Funds - but overall a healthy a mix of the 2 definitely wouldn't hurt

[@marktex9171]

I own almost all of the big banks and invest the same $ amount into all of them. For now I will continue to add to my holdings this way and stay away from the ETF. Like you pointed out, why are the dividends so low? great question!

[@JSB-2Z-2K]

They made a video recently on some higher didivend ETF'S who give around 5-7% yields

[@steevengingras4087]

Both have merit but I stick to my formula of diversification into both stocks and ETFs. Appreciate the video very informative!

[@beaviswealth]

Sounds good, Steeven! Thanks for watching. - Marc

[@James_48]

At the beginning of the year I’ll look at which banks have the best yield - top two or three. I’ll rotate into them. Yes, the yield is higher, but I treat it more as a sign that they are currently undervalued. Doesn’t have to be first of the year. If there’s significant moves at other times I might switch it up, but with awareness of when their respective ex-dividend dates are.

[@kylewhite5147]

I personally gravitate toward the banks themselves because I put anywhere from $500--650 into my account monthly, but I've been encouraging a friend of mine to focus primarily on ETF's because he's only putting roughly $100/m I don't know if this is the best strategy, but I think the more serious you get with investing, the higher the risk tolerance (not that the Canadian banks are risky per se) Anyways, thanks for another informative video, much appreciated!

[@beaviswealth]

I like your strategy, Kyle. Generally, what you're saying makes sense, depending somewhat upon your account value. Thanks for supporting the channel. - Marc

[@ShameerRavji]

Thx for the vid. Personally I just buy the individual Bank stocks and avoid the ETF fees since there are only 6 big banks up here. I already have 5/6 of the banks with TD as my core holding . NA is the only one I don’t have and looking to add that one at some point.

[@chrisdubs121]

Little blip at the beginning love the content

[@nombr]

Can you do a video on bonds to invest for a person within 5 years of retirement please?

[@eagerbeever22]

I own shares of BNS, TD, & CM and looking to add more BNS. I prefer stock picking in this case vs ETF given that ETF has only 6 banks in it .

[@r.chambers2736]

Marc. I’d love to hear your opinion or analysis on the Hamilton etf HCAL If there is something that I would be comfortable to have leveraged it would be the Canadian banks and with rates set rise leverage may provide a reasonable return

[@joshb.6353]

I also like the mean reversion part of the strategy. I hope it will continue to justify the high mer.

[@wendesa5143]

How about a assest allocation ETF like ZGRO/ VGRO. Do you pay more in fees because each ETF within the ETF charges fees? Thank you. Love you guys and learning from you

[@niranmojo]

VGRo

[@QuarterKnight01]

Typically, fund managers do not have duplication of fees. You won’t pay fees for ETF’s within ETF’s, or if you do, it is already encompassed within the MER. This is not slightly not true for robo-advisors like Wealthsimple though. For WS, you pay 0.50% for the service, plus the underlying ETF fees on top of the 0.50%.

[@wendesa5143]

@@QuarterKnight01 thanks so much. That makes sense.

[@JoeSmith-pu9hi]

Return of the Jedi! Great info

[@Shirley-v3g]

I like the tax efficiency of the dividend tax credit.... through directly holding the stock..

[@kirklangdon1591]

I would think the etf providers are keeping a portion for themselves on top of the management fees.

[@ryanm7171]

I used a combination. About 70 percent were actual bank stocks, while the remainder was the BMO Covered Call Equal Weight Canadian Bank ETF. Although the the BMO Covered Call product paid a larger dividend, over the years the total return has significantly lagged. I wish I had not bought the Covered Call product, but rather purchased the stock or the equal weighted Canadian Bank ETF instead.

[@James_48]

Yup, that higher dividend is like a drug for the income, but when you look at total return it usually doesn’t work out.

[@carollshelby500]

Loading up on JPM and RBC

[@littleninjai222]

Thanks for this Marc. I thought even if you 'own the individual securities' each time you contribute more money (or purchase more units) to the securities you are paying a transaction fee (cost depending on where you transact i.e. Quest Trade vs. Bank - Direct Investing)?

[@pwatom22]

Why dividends are less on etfs.. could it be due to trading activity meaning some of the holdings don't qualify as they were not held from ex dividend date to payment date? The 6 bank straight etf seems pointless. As far as I can see the only reason to hold a Can bank etf would be if they are running covered call strategy.

[@sylvainbeausejour]

As of today, if you bought one share of each of the six big banks (assuming you use a discount brooker like Disnat with 0$ commission), you would have to spend a mere $564 and you would get 4,50% yield in dividends. Buying ZEB which holds the same banks, will only offer you 4,13%. As I have way over $564 to invest… I go individual. I only go ETF when I need higher income and then I use ETF with Split, Covered Calls and Leverage strategies.

[@beaviswealth]

Thanks for sharing your strategy. - Marc

[@maxlucci3845]

I have a question regarding DCA (Dollar Cost Average). I am planning to DCA on some stocks during this ''Bear-ish'' market that's happening at the moment. Would it be better to DCA with wealthsimple instead of Questrade, since Questrade takes $4.99 as a commission for every stock you buy?

[@QuarterKnight01]

As per your own reply, it is better to DCA with WS. This is more true if you plan to DCA with less than $1000 per transaction, because those $4.99 charges will eat up a lot of your investment and be a bigger percentage overall.

[@meditationavecmaryse7293]

Simple and concise information. Thank you!!!!

[@jt8280]

If you have time, bank individual shares are always the best. ETF fees and diluted distribution yields are a negative. You want to maximize the Cdn. dividend tax credit.

[@MegsCarpentry-lovedogs]

Exactly....the dividend tax credit is super important if stocks are held outside a TFSA and an RRSP or TFSA.

[@NoobBoobie]

Yes that's fair but can you buy 6 banks for 40 ish $ like ZEB? That's a fair trade off to have all the banks for a fee, I like ZWB better you pay a little more but that ETF does calls which I never plan kn doing but adds to the dividend yield.

[@MegsCarpentry-lovedogs]

@@NoobBoobie FYI: but your ETF divvy does not provide preferential tax treatment like stocks with the Cdn. Dividend tax credit when outside an RRSP or TFSA and the taxes on the ETF divvy is treated like 100% income..yikes! I have a "basket of stocks" like an ETF that has 4 sectors represented (about 16 stocks) AND has preferential tax treatment using the Cdn tax credit..its NOT an ETF..I probably can't mention what it is on this platform, I have in the past but it gets deleted .... But....its out there so I guess one has to go try to find it if interested...its a beauty to have....and there is zero Return of Capital in the dividend as well.....where there are others that do have this ROC...ROC is NOT a good thing to want to have in your portfolio. So much to learn eh!

[@NoobBoobie]

@@MegsCarpentry-lovedogs that's why you use TFSA and RRSP. Simple.

[@ronco65]

@@MegsCarpentry-lovedogs So to be clear, are you saying that the dividends from ZEB in a non-registered investment account in Canada would not obtain the Canadian Dividend Tax Credit and instead those dividends from ZEB would be taxed as income? Why would that be? Is that the tax law?

[@josephcollins6526]

thanks for this ...wish you had included US banks too..while they pay lesser dividends they have offered better capital returns vs Cdn banks the last few yrs. i'm invested both cdn and US banks...reading more on US regional banks too that are promising (citizens financial etc)

[@canpin]

I have ZEB, ZWB(covered call) , TD and RY 😊

[@syedsuhail8834]

Very good presentation. Thanks

[@annehenderson7911]

Always, always such solid research upon which to make your decisions.

[@dgomes265]

I have individual Banks in all of my accounts but recently added ZEB to my wife’s TFSA.

[@roberttaylor3594]

I bought CM in April 2020 because it had dropped the most, percentage wise, so I figured it would rebound the most. Then in June 2021 I switched to BMO because I thought it would do better based on 'what I heard and read". It worked out pretty well, but I don't REALLY know what I doing, so I was mostly lucky. HCAL seems interesting because it tries to figure out which banks will do best and weights the portfolio accordingly. But...not as fun and I kinda think it's generally hard to go wrong with any Canadian bank over the long run. I have stocks and ETFs in Canadian banks but the funnest is the stocks because I am making the call. I figure dividend are higher than ETF due to fees, but I think HCAL pays higher in general.

[@QuarterKnight01]

I love HCAL, but the MER is pretty high. Higher than 0.65%, despite what is says on the prospectus.

[@roberttaylor3594]

@@QuarterKnight01 that’s interesting!

[@Rob-ob3sh]

Would you cover NTR please ? I’ve been thinking of starting a new position

[@brycemcintyre141]

Is it more advantageous to invest in the s&p 500 index fund or the Canadian banks index(ETF) fund as a Canadian?

[@James_48]

It’s kind of like asking should I eat meat or become a vegetarian. You might have a good reason for one, or the other, so go with that, but for many a balance is what works.

[@leebodkin8358]

at this present time I think Canadian banks are safer as the s&p is probably going to drop more and banks have higher dividend yields regardless of the capital growth but I am not a professional just a feeling.

[@James_48]

@@leebodkin8358 yes, it looks that way, one must be careful not to go “all-in” with one or the other, but nothing wrong with the occasional lean or rebalancing a portfolio

[@jagjitparhar214]

Individual bank stocks for sure on my end.

[@bunating]

Excellent & timely vid - I've been contemplating buying a bank ETF vs the individual stocks. I always appreciate Marc's comprehensive info explained well, experience and teaching me new things. What do you guys think of the performance of the Canadian Banks (with dividends reinvested) vs. the S&P500? I read that Cdn banks outperformed S&P in the long run. My portfolio is mostly XEQT & VFV, thinking of adding bank stocks and maybe make them the majority of my portfolio.

[@jeffchaudhary5371]

Thank you, I love your video and information

[@ek4679]

Thanks . Are the ETF distributions eligible for the dividend tax credits like the bank stocks?

[@sdandrea5245]

yes

[@ab.4425]

Great video Marc!! Thank you so much!!

[@glenterris3980]

This is interesting to me that this exact video came out today because just two days ago, I was comparing an ETF holdi ng the top 6, for my situation I plan to invest in the top 4 individually, for the reasons that I think it will outperform the ETF itself and I will save on management fee. This for me works because, I will be overseeing my account on a daily basis and enjoy investing. I think if you perfer to be hands off, than the ETF path is the way to go.

[@teh_longinator]

Just found this video, and this comment spoke to me. I'm in TD and BNS atm, but when looking at ZEB, decided that I'll start positions in RY and CM as well. I'm already in CWB as a value play (ended up being great with a recent +10% day)... but I'd much rather hold the top 4, and decline the other couple of banks I don't believe in so much.

[@paob7580]

Love this Intro!!!

[@jonathanseverson9331]

use a combo of both since you cant go wrong with the anything banks as we seen they all boom recently

[@chrisbauld5387]

The Banks were allowed to increase their dividens last month .. i would assume thats the reason

[@valveman12]

I used to hold most of the Canadian Stocks in my portfolio. Banks are a good investment, but I really like monthly dividends so I sold my bank stocks and bought ETFs. HMAX holds not only all Canadian banks but also Suncor, Manulife + others. There is also SBC, which is a mutual fund that also holds Canadian Banks. Banks are great to have in your portfolio and a great hedge when things look rocky...

[@joefalcone4762]

Great information

[@Cat-zc8nj]

The dividend is the reason why I own 4 of the banks instead of an etf.

[@Menestra99]

I dont understand when you say you can have risk investing in a bank. Bank are not suppose to be the most secure investment? I concur the price may fluctuate, but in the long run, is a real secure investment!?

[@cuybueno]

Currently, the bank's stocks prices are a bit high. Since I am a small investor I prefer to buy ETFs. I hold ZEB and ZWB.

[@beaviswealth]

Makes sense... thanks for watching. - Marc

[@Rolandalvarez-tr2lz]

Combination ZEB + RY+NA

[@mjking8704]

I chose to own the asset itself, I don’t need to pay an MER for something I can manage myself, I’m okay with the risk.

[@nahomfirew8970]

Never been this early to a vid thank you Marc

[@RyanThomasWoods]

I was totally thinking of a bank etf would be better or individual bank stocks during this time so very timely!

[@MegsCarpentry-lovedogs]

@Naithan Fyfe FYI: but your ETF divvy does not provide preferential tax treatment like stocks with the Cdn. Dividend tax credit when outside an RRSP or TFSA and the taxes on the ETF divvy is treated like 100% income..yikes! I have a "basket of stocks" like an ETF that has 4 sectors represented (about 16 stocks) AND has preferential tax treatment using the Cdn tax credit..its NOT an ETF..I probably can't mention what it is on this platform, I have in the past but it gets deleted .... But....its out there so I guess one has to go try to find it if interested..😉 .its a beauty to own....and there is zero Return of Capital in the dividend as well.....where there are other "basket holdings" that do have this ROC...ROC is NOT a good thing to want to have in your portfolio. So much to learn eh!👍💯🇨🇦🍁 Total peace of mind holding this gem which is also a tax efficient investment vehicle.

[@rb13818]

I started with bank stocks, but Etfs took over my portfolio lol

[@LATINLUVAH]

Can I ask how many etf’s you’re looking to purchase in total? I’m just getting into the etf but I’m having trouble deciding how many etf’s to purchase in one ticker.

[@rb13818]

@@LATINLUVAH how many in total? Idk how to answer that, lol i buy a fund or an etf if i saw potential in it in the long run to reach my goal since my investment strategy of choice is dividend and growth dividend,

[@Fhfjdod8ebrmsow9e]

If you look at the major share holders of each of the big 5 banks you will see the 4 banks own around 5%.

[@CanadianDividendInvesting]

Canadian banks are a high percentage of my portfolio

[@ferdin4491]

Yessss love the old intro

[@anwarmaru1523]

I'm new to the market. Official been one year now. I'm invested in mostly high growth stocks. Just recently started getting into more of the financials and energy sectors. I find etfs are my choice at the moment such as ZWB, ZCN etc... will get into more individual stocks eventually. Thank you and Brandon for the work and time put into all this.

[@momo35444]

thanks marc for the great advice. always knowledgeable content.

[@Lopersen]

Thank you.

[@bestknightmare]

Background music back to the original

[@Wongoo]

Yay back to the country entry

[@atio5491]

I don’t have any individual bank shares, I just add to my ZEB whenever I feel it’s getting too far behind in %

[@LATINLUVAH]

But how many shares are you aiming to buy in total?

[@davidlavallee7135]

I see ETF as a good strategy when having a smaller account to give yourself a better diversification of stocks. One of the things I look into is the Distribution of the ETF and that should cover the MER for that particular ETF. Which means the MER becomes insignificant.

[@kevinrawle3383]

I work long hours, so it is hard to manage a portfolio - so I look at ETF's who do work for me. However, I believe a market crash is coming this year - so it is hard to invest in anything.

[@juanperez-gh8bl]

Personalmente prefiero comprar acciones individuales en mi cuenta de inversión, porque si escoges buenas compañías consigues mejores rentabilidades en general, pero en mi cuenta de banco, donde esta el dinero de mis gastos tengo un ETF de Colombia, es muy seguro, pero por eso mismo la rentabilidad es baja 3.6% en el 2021, no es mucho, pero es mejor que nada jajajaja "Personally, I prefer to buy individual shares in my investment account, because if you choose good companies you get better returns in general, but in my bank account, where the money from my expenses is (six months), I've an ETF from Colombia, it's very safe, but the return is 3.6% in 2021, not much, but better than nothing hahaha"

[@KV-fv4fs]

Brandon, Mark, maybe a good topic to discuss on a next video. Is it safe to invest on the NEO exchange, pros and cons. Thanks.

[@boshkaniedits731]

You left a black screen in the beginning by accident

[@RandomEvents_]

A like and a comment for the algorithm. Thanks

[@brexit9279]

NEITHER OF THEM! GET OUT OF THE BANKING AND STOCK MARKET NOW. BUY GOLD OR SILVER UNTIL THE MARKET CRASHES, THEN GET BACK IN

[@philip8543]

This video does not start seem stuck

[@thetrandingone]

Hi ... I am from INDIA. and i have one question about ETF. india have NIFTY and SENSEX as a index. Nifty BEES is a ETF lauch in 2002 that follow Nifty index. Nifty index/100 = Nifty BEES But as of now nifty index is 17617 So nifty bees must be 176.17... But nifty bees price is 190.64. So according to my brother we are paying premium or high price for nifty bees and if nifty index reach more 10per cent up but our bees will not follow it correctly and give us less return. Is it right ?? Are we paying more money? And will i get less return compare to nifty index..?

[@jasonseitanidis4776]

Good move bringing James barker back 👍

[@Rob-ob3sh]

Looks like you have an bot imposter replying to your comments.