# Complementing XIC/XIC with XDV/CDZ



## larry81 (Nov 22, 2010)

I own XIC for my Canadian market exposure, i am currently sitting on some cash, all this is non-registered account.

Lately i have been pondering the idea of adding a Canadian Dividends fund to complement my XIC, from my point of view they look quite attractive + tax credit if i place the fund in my non-registered account. Any input regarding this ?


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## Belguy (May 24, 2010)

This doesn't answer your question but I complement XCV with a lighter weighting in XCS for long term holds on the theory that value and smallcap stocks outperform over time.


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## larry81 (Nov 22, 2010)

Interesting XDV/XCS mix !

Dont XIC already offer some exposition to smallcap ?


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## Belguy (May 24, 2010)

I think so but am not sure because I never held XIC. I hold about 12 percent of my overall portfolio in the iShares Canadian Value ETF (XCV) and about 8 percent in the iShares Canadian Smallcap ETF (XCS) and just rebalance to these positions as required. The smallcap component will likely add some volatility to a portfolio but will probably provide superior longer term performance. Smallcaps have done well coming out of the recession as they are generally the first to recover in an improving economy. What will happen from here might be a different story but I just buy and hold for the long term--if I even still have a long term!!


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## larry81 (Nov 22, 2010)

What kind of bonds do you own, old wise man


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## gibor365 (Apr 1, 2011)

Belguy said:


> I think so but am not sure because I never held XIC. I hold about 12 percent of my overall portfolio in the iShares Canadian Value ETF (XCV) and about 8 percent in the iShares Canadian Smallcap ETF (XCS) and just rebalance to these positions as required. The smallcap component will likely add some volatility to a portfolio but will probably provide superior longer term performance. Smallcaps have done well coming out of the recession as they are generally the first to recover in an improving economy. What will happen from here might be a different story but I just buy and hold for the long term--if I even still have a long term!!


I doubt XIC has any small caps.
I hold something similar , mix of XIU and XCS and it's about 50/50. Actually last year I had CIBC Small Cap mutual fund and this year transfered all this fund to XCS. Belguy is very right. XCS/small cap MM "have done well coming out of the recession", now they are underperforming... but hopefully will recoved until end of the year (BTW , similar situation with US Russel 2000).
Personally, I don't like XDV. XIU with 2-3 dividend aristocrats should do better


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## Belguy (May 24, 2010)

I have had thoughts of moving my XCS holdings to the Beutel Goodman Canadian Smallcap Fund but have so far resisted. What say you?

http://quote.morningstar.ca/quicktakes/fund/f_ca.aspx?t=F0CAN05MR5&region=can&culture=en-CA

My core bond holding is the PH&N Bond Fund D

https://www.phn.com/Default.aspx?tabid=524

I also have some high yield and junk bond holdings via the Claymore Advantaged High Yield Bond ETF, the iShares IBOXX High Yield Corporate Bond Fund, the Morgan Stanley Emerging Markets Domestic Debt Fund, the SPDR Series Trust Barclay's High Yield Bond ETF, and a small holding in the iShares Real Return Bond ETF (XRB).

Please do your own due diligence before investing in any of these.


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## gibor365 (Apr 1, 2011)

Belguy said:


> I have had thoughts of moving my XCS holdings to the Beutel Goodman Canadian Smallcap Fund but have so far resisted. What say you?
> 
> http://quote.morningstar.ca/quicktakes/fund/f_ca.aspx?t=F0CAN05MR5&region=can&culture=en-CA
> 
> ...


I compared performance of BTG799 vs XCS. For 1, 3, 6, 12 months returns of XCS the same or better, BTG799 has better returns for 3 years plus.
But don't forget that BTG799 is FE fund, so you have to pay for it.

I did a mistake some time ago buying 5 stars rating AGF LL Emerging market fund...and it's performimg pretty ppor... now if I sell it within 3 years, I have to pay commissions


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## Eder (Feb 16, 2011)

larry81 said:


> I own XIC for my Canadian market exposure, i am currently sitting on some cash, all this is non-registered account.
> 
> Lately i have been pondering the idea of adding a Canadian Dividends fund to complement my XIC, from my point of view they look quite attractive + tax credit if i place the fund in my non-registered account. Any input regarding this ?


I would buy some BCE and RY rather than a fund if $20k or more involved.No sense getting bits of Transalta and other pooches that etf's include.


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## Financial Cents (Jul 22, 2010)

@larry81 - why not sit on the cash for a bit and pour more into XIC when it dips below $21? It's a great product. If you already own a whack of XIC, I'm not sure how much more value you'll get with XDV/CDZ, even though I like these ETFs. 

Depending on how much cash you have, if >$5K say, why not buy a bunch of ENB or TRP unregistered?


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## dcaron (Jul 23, 2009)

Any thoughts on XTR?


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## rassmy (May 7, 2010)

I own XTR in my RRSP and TFSA, it is one single etf that diversify on multiple sectors yielding 5.6% with monthly distribution. I like it.


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## larry81 (Nov 22, 2010)

Financial Cents said:


> @larry81 - why not sit on the cash for a bit and pour more into XIC when it dips below $21? It's a great product. If you already own a whack of XIC, I'm not sure how much more value you'll get with XDV/CDZ, even though I like these ETFs.
> 
> Depending on how much cash you have, if >$5K say, why not buy a bunch of ENB or TRP unregistered?


I try to avoid individual stock and favor broad index, i like simple things 

I have >60% cash right now and i am buying more and more ETF each months, i am still hesitant to make "big" purchase as most index are now at their historical peak. Also hesitant to purchase bonds in my RRSP and might just wait for the raise in interest rate.

If only i had a crystal ball !


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## Belguy (May 24, 2010)

Maybe off topic, but here is another thing to consider. While I don't have the stats to back me up, I heard on BNN that Canadian smallcaps have not outperformed Canadian largecaps because they include many commodity plays.

However, the Russell 2000 has outperformed the S&P 500 over time because of it's superior diversification.

What this would tell me is to tilt more towards smallcaps in your U.S. holdings and more towards largecaps with your Canadian holdings.

Does this make sense?


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## Financial Cents (Jul 22, 2010)

@larry81 - fair enough. >60% cash? wow. Don't you worry with that much on the sidelines, you're losing out to inflation? Wouldn't some XSB or similar be better than cash?


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## larry81 (Nov 22, 2010)

they are actually held in "High" interest saving accounts.


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## Financial Cents (Jul 22, 2010)

larry81 said:


> they are actually held in "High" interest saving accounts.


Fair enough, about keeps pace. 

You could always limp in with either XDV or CDZ by starting some small positions at existing prices?

I did just that recently in my TFSA with some RCI.B. A couple of bucks in share price doesn't really concern me; I won't care about it in another 10 years, or much soooner 

I'm sure most folks don't like that strategy but my take is, I'd rather be invested that nickel and dime everything I buy.


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## larry81 (Nov 22, 2010)

Since my income is fairly volatile and that now is not a good time to buy bonds, i am seriously considering adding more Canadian dividends stocks to my AA.

I don't want to purchase the individual stocks since it would be a PITA to track it in my non-registered account.

I am pondering with the idea of splitting my Canadian exposure equally between XIC/XCS/XDV.


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## gibor365 (Apr 1, 2011)

larry81 said:


> I am pondering with the idea of splitting my Canadian exposure equally between XIC/XCS/XDV.


Sounds good... XIC shoudl go with XDV, and XIU with CDZ.

Did you check XTR?


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