Investment Update - Feb 2019

Welcome to my very first investment update! I will update my investment portfolio holdings every month around the 20th of the month. My portfolio is very simple. I only hold 3 ETFs, and I hold each ETF in a different account for tax purposes. All my accounts are held with Questrade because they offer free ETF puchases.

Explanations

VDY is the Vanguard FTSE Canadian High Dividend Yield Index ETF, which is traded on the TSX. I hold this ETF in a non-registered (margin) account in Questrade. This is because I am using LOC funds to invest, so I can deduct the interest from my taxes. This reduces the effective interest rate on my LOC from 4.45% to about 2.75%. The dividends I received are taxed, but since they are eligible dividends, they are only taxed at about half the rate of regular income.

VYM is the Vanguard High Dividend Yield ETF, which is traded on the NYSE. I hold this ETF in my RRSP and my wife's S-RRSP. This is because US dividends received in RRSPs are not charged a 15% withholding tax, as would be the case in a TFSA or non-registered account.

MGK is the Vanguard Mega Cap Growth ETF, which is traded on the NYSE. I hold this ETF in my TFSA as I expect this to be a very high growth ETF, so it makes more sense to hold it in a TFSA.

The Plan

I plan on contributing the dividends I receive from VDY to my TFSA in order to purchase more MGK. This will allow me to contribute as much as possible to growth stocks, since I have a longer time horizon. I also plan on contributing $1000/m from my cash flow into my TFSA, and $400/m from my cash flow into my wife's S-RRSP. Any dividends received from VYM will get reinvested into more VYM.

All my investments are down since I bought the majority of them in the summer and fall of 2018. However, they have been recovering nicely in the last 2 months, and I hope that they continue to appreciate.