I use the Global Couch Potato with e-Series funds in my TD Waterhouse account, but I eventually want to use the Complete Couch Potato. Once my portfolio gets to $50,000 and I qualify for $9.95 trading commissions, should I move everything to ETFs? — Mark V.
If you’re a client of any other brokerage, it makes sense to use ETFs to build the Complete Couch Potato portfolio. But with TD Waterhouse you have the unique opportunity to combine the e-Series mutual funds and ETFs in the same account. For five-figure portfolios (and perhaps even much larger accounts) a hybrid approach is likely to make more sense than using all ETFs.
The Complete Couch Potato has three asset classes that are absent in the Global Couch Potato: real estate, real-return bonds, and emerging markets. There are no e-Series funds for these asset classes, nor are there low-cost index funds from other providers. But that doesn’t mean you can’t create a hybrid portfolio of e-Series funds and ETFs. It would look something like this:
Fund name (ticker)
TD Canadian Index – e (TDB900)
TD US Index – e (TDB902)
TD International Index – e (TDB911)
Emerging markets equity
Vanguard MSCI Emerging Markets (VEE)
BMO Equal Weight REITs (ZRE)
Real return bonds
iShares DEX Real Return Bond (XRB)
TD Canadian Bond Index – e (TDB909)
A few words of explanation.