It’s been a while since the last new article appeared on the Canadian Couch Potato blog, and over two years since the last podcast. So I’m pleased to share the reason for the long silence: I’ve been busy on a new book called Reboot Your Portfolio: 9 Steps to Successful Investing with ETFs.
The official publication date is November 1, but the book is already available for pre-order on Amazon and Indigo, and will soon be on shelves at better bookstores across Canada.
I stopped recording the podcast in the summer of 2019 because I needed to take a break and think about how I could make my work more useful in a world of information overload. I didn’t want to just crank out content on a deadline: I wanted to create something that would have a lasting impact on readers and listeners. What was needed, I recognized, was a step-by-step guide to designing, building, and maintaining a portfolio of ETFs over the long-term.
The new book is something of a reboot in its own right. When I was a columnist and editor at MoneySense magazine, I wrote a modest book called the MoneySense Guide to the Perfect Portfolio, which laid out a plan for building a Couch Potato portfolio with ETFs and index mutual funds. That book sold out three editions, but it has been out of print since 2013. I still get emails from readers looking for copies, but there are none, and even if there were, the book is profoundly out of date now. The marketplace has changed dramatically: online brokerages are better and cheaper, excellent new ETFs have appeared, and roboadvisors have become a viable option for DIY investors who want a more hands-off approach.
As 2020 dawned, I had a clear idea of what my next project would be. Now I just needed to find the time to do it. Then along came the COVID pandemic, which meant a lot more time for all of us.
All of these roads led me to write Reboot Your Portfolio. The book is a complete guide to becoming a do-it-yourself investor using low-cost index ETFs. It draws heavily from the writing I’ve done over the years, since much of the advice hasn’t changed. But everything has been thoroughly updated, and large sections are brand new, reflecting the changes in the investing landscape. Moreover, my own approach has evolved during the last decade as I made the transition from financial journalist to portfolio manager: the more closely you work with human beings, the more you realize that simplicity always trumps complexity.
If you’re a hardcore DIY investor who’s been using ETFs for years, and you’re looking for advice about optimizing your portfolio to shave a few basis points in costs or taxes, you won’t find that in the book. The same goes if you’re only interested in model portfolios or specific ETF recommendations.
My goal with the book is to help you get away from the idea that successful investing is about choosing products and obsessing over tiny tweaks that will take you from an A to an A+. As I’ve worked with hundreds of investors over the years, I’ve come to understand that I can help more people just by getting them to an A. The small details don’t matter very much after that—and indeed, stressing over them can easily sidetrack you from what’s really important.
I hope you enjoy the book, and that it will help you get started on a path to investing success.
Looking forward to reading it! Do you have any opinion on the “Advanced Couch Potato Portfolios” by Dale Roberts in Moneysense? They suggest adding REITs, gold, commodities, treasuries, even crypto to the traditional couch potato portfolios to to provide more diversification in low growth periods. I actually already have done this with REITs and have enjoyed that they are less correlated with most of the equity ETFs. Is there any disadvantage to owning too many asset classes? Do the commodity ETFs really provide the same hedge as owning gold directly?
Thanks!
Good afternoon Dan,
Would you still recommend reading “reboot your portfolio” for an individual already maxed in TFSA and starting on margin with VEQT? I suppose the answer’s obvious but your thoughts would be great!
Cheers
Congrats on the new book Dan! As someone who’s already read / listened to most your stuff, I assume I’m not the primary audience, but given all the free advice you’ve given over the years, purchasing a copy was the least I could do to say thanks (Amazon is taking orders again, just saying a month or two until it ships).
This will also be great because I always refer new investors to your stuff, but like you mentioned to Preet, it’s hard to know a good starting point on the blog and 26 podcast episodes is a bit of a commitment (plus some of the content pre-dated things like the asset-allocation ETFs).
And I’d second Preet’s comments on your “broadcasting” skills: the podcasts were certainly educational, but they were also easy listens and never boring. As much as I loved the “ask the spud” and “bad investment advice” segments, if you bring it back, hopefully you can find a format that requires less prep work (I could also see co-hosting a podcast with Justin or someone else working).
@Vince: I’ve tried to stress in the book that successful investing over the long term is about more than “just buy this ETF.” I spend a lot of time on the bigger picture, which includes, for example, whether it’s really wise to invest in 100% equities with borrowed money. That’s an extremely risky strategy, especially if you never never lived through a severe bear market (March 2020 doesn’t count).
@Graeme: Many thanks for the kind words, and for purchasing the book!
I’m interested, but I don’t buy paper books anymore. Will it be available in electronic form?
@Dan oh, I didn’t mean I use borrowed money for my margin account lol. Only the money that I’ve personally deposited in the account. It’s through questrade I’m not sure if there’s an alternative name for accounts like that, it’s not a TFSA or RRSP though
However thanks for responding! I think I will buy a copy of your book and try to give it to any friends who want to learn too :) I’m still definitely a novice
And yeah I didn’t have investments in March 2020 luckily. Can’t really imagine how I would’ve felt. I did come on this website older articles and saw your advice to others around that time (which was good advice). Now I’m just in uni so it’s hard to save x_x
@Vince: Sorry for the misunderstanding. Questrade confusingly uses the term “margin account” for any non-registered (taxable) account. I had thought you were investing on margin (i.e. with borrowed money). Glad to hear you’re not! Good luck, and hope you enjoy the book.
@Martine: An e-book is in the works!
Have ordered on amazon, looking forward to reading and to sharing with others.
I just finished reading your book. Well done! And I’ve ordered another copy for my daughter & her husband for Christmas. (I hope it arrives on time. Amazon is out of stock and not promising Christmas delivery.) I’m already an ETF investor having followed your blog for years now. These asset allocation ETFs are interesting in that my wife and I want to simplifying things as we age. Is there an upper limit of investable assets at which you would recommend NOT using a single asset allocation ETF? 10M?, 5M?, 1M? other? Thank you and congratulations on your book again.
@John A: Thanks for the kind comment, and for attending the TPL presentation, where I tried to answer your question quickly! I think an asset allocation ETF is certainly appropriate for portfolios up to $1 million or so, and really, you could do much, much worse even at $10 million. But it’s fair to say that once you have a seven-figure portfolio you may want to consider, for example, using US-listed ETFs for foreign equities in an RRSP, and using a more tax-efficient solution for bonds in a taxable account (like ZDB and/or GICs). But, as always, this assumes you’re willing to put in the extra work to do this properly.
Thanks again, and glad you enjoyed the book!
Just finished the book, but still have questions regarding trading International and emerging markets ETFs. Since the recommendation is to only trade while the markets are open how to do you trade the above ETFs as there would be very little if any overlapping time that North American markets and foreign markets are open as the same time. What is an investor to do?
@Cameron: Thanks for reading. When I discuss trading when the market is open, I was only referring to the markets where you are placing your orders (Canadian and US exchanges). I have heard of people placing limit orders after-hours with the idea the orders will get filled when the markets open the next morning. I also advised against buying Canadian ETFs that hold US stocks on US holidays.
You are correct that if you buy international equities, the underlying markets for those stocks may be closed. This is generally not a problem: certainly not for the average retail investor like you and me, especially if you are a buy-and-hold investor. Market makers can get accurate enough pricing on international stocks even when their markets are closed.
Hi Dan,
Do you happen to talk about crypto in your book? Still debating what to do…
cheers
Congrats Dan!!
Pls make an ebook soon!!!
You have changed my investing life forever. I am grateful to you immensely.
I plan to have a large amount in VGRO because I want a simple investing life. I hold it in all accounts including my corporation.
I think this type of investing can be used for 8 figure accounts even.
It’s not perfect but it is more than good enough for me.
My accountant and other advisors make fun of it. But I have reached investing simplicity.
I would not have been able to do that without your generous advice and support on this site.
Once again congrats with the book. I look forward to getting my copy soon.
@Vince: I discuss crypto on page 1. My advice can be summed up simply: “Don’t.” :)
Seriously, the book is focused on long-term, buy-and-hold investing. It won’t appeal to anyone who is planning to include crypto as a significant part of their portfolio.
@Stephanie: Many thanks for your comment, and for having the courage to argue that simple ETF solutions are appropriate for large accounts!
The e-book is in the works and should be available in December.
Was looking forward to reading the book this week, but Amazon canceled the order “Unfortunately, a problem occurred during shipping and we had to cancel your delivery.”
Will reorder and see how that goes this time!
Amazing! Just ordered. This could not have come at a better time, I was literally googling for a book in this exact topic yesterday and came up short. Can’t wait to read! Thank you for sharing all your expertise in a book!
Dan,
I have known about this website for so long, but I did not really try to follow your advice. Hence, I lost so much investing on my own. I thought I was invincible. Lol.
Going forward, I will follow the suggestions in this blog. Thank you for helping common people like myself. I am really grateful. I will buy your latest book, as a show of support. Take care.
Jas
@Jas G: Thanks for the comment, and hope you enjoy the book!
Hi Dan,
Would you say crypto isn’t a consideration because of volatility/unreliabity compared to ETFs then? I just wonder because of talk of it becoming mainstream (El Salvador, although they haven’t been doing well). Do you think that is possible but just a gamble, or that it is too unlikely to consider, or that for reliability long term just stick with ETFs? If you’re allowed to speculate or give your opinion on it more than how it’s risky lol.
I mean I’m kind of bad about thinking about stuff like investing 1k in crypto a year ago, I remember the last Bitcoin craze and when it dropped 80% in 2018 or so too. My investment in ETFs is long term but it’s hard to not wish for it to come sooner lol. Same feelings as in history when everyone went up the river for the gold rush I guess.
Thanks for putting up with my questions!
This is exciting! I’d love to gift this to someone – is there a way to purchase it without going through Amazon?
@Erin: Thanks for your interest. The book is available online through Chapters Indigo, though it is currently out of stock.
If you want to support a local bookseller (which I encourage!) you can also ask them to order it for you.
@Vince: Long-term buy-and-hold investing is painfully boring, and you will need to come to terms with FOMO. You’re the only one who can make that decision.
I got my book today and I loved it. It’s worth the wait. I truly appreciate that you acknowledge the fear strategy used in industry and your words bring a peace-of-mind at least for me! Thank you for writing this book. I am looking forward to your future writing!
My copy arrived today, and after thinking “I’ll read a few pages” I ended up reading the entire thing tonight lol. At first I was worried I’d get bored due it being an introductory book, but it was actually still a really enjoyable read, and served as a good refresher, plus a lot of the quotes and some of the specific research were new to me (I found the idea that a 20/80 portfolio may be no riskier than an all-bond portfolio to be pretty fascinating).
@Graeme and Yuan: Glad you’ve received your books, and that you enjoyed them. If you wouldn’t mind leaving a review on Amazon, I would very much appreciate it!
Thanks so much.
Terrific news! Looking forward to reading it.
Any plans to make it available in ebook form? E.g. Kobo?
@Dave: Yes, Kobo and Kindle e-books are in the works and should be available in December!
Anything in the book for someone who just inherited $15M? Like is it even possible to buy VBAL with that kind of money?
This is fantastic. Thank you so much for writing the book. Do you think it will be available in the libraries?
I hold 17 ETFs in my portfolio which is not normal I know but I love my strategy. It is paying me big in both growth and distributions. I own some unique ETFs nobody mention. Talking about $HBLK (Blockchain), $EDGE, $TECH, $TLF, and many more which I discussed in a 3 series on my blog.
@Brian: I’d suggest that if you just inherited $15M then you’d be well served to consult a fee-for-service financial planner for a comprehensive plan. Your questions should go well beyond “what ETF should I buy.”
Thank you Dan – I agree and that process is well underway. I am no longer investing for me (I am 64) but for future generations and charities and much of this will be going in that direction ASAP by giving the kids money for a future house now and donating shares with large gains held in my corporation.
The thing is, most of the inherited funds are in bank stocks and GICs. Sure the banks have done great but this does not fit my diversified Couch Potato approach which has served me well in accumulating assets of $5M (thank you – you have been my guide for many years). Yet, to convert this group of stocks to a few low fee ETFs is not that easy given Canadian trading volumes. Is there a wealth threshold when ETFs no longer work well?
@Brian: Thanks for the comment. There might be a wealth threshold beyond which ETFs make sense, but it is much higher than $15M. For large trades (say, $1 million or more) brokerages may be able to assist you in getting best execution, as their trading desks can work directly with the market makers. Trading volumes are not a significant issue if the underlying securities are liquid, and that is almost always the case if you’re using broad-market ETFs.
Dan,
It’s been a long time, but once again I take this opportunity to thank you for all you’ve done for me and for many others. Good karma that I trust is reaping its rewards!
I hope you and your dear ones are happy and well.
Congratulations on yet another gift to the world: this helpful and timely book. :)
@Nadine: So great to hear from you again, and thanks for the kind words! I do hope you enjoy the book. All the best to you and yours.
Hi Dan does asset location is approached in the book? Thanks!
@Charles: I do discuss this in the book. My advice to DIY investors is largely to ignore asset location: this is a natural consequence of using asset allocation ETFs anyway.
My thinking on this has evolved over the years. In my experience, asset location decisions complicate a DIY portfolio unnecessarily. Most people tie themselves in knots over this issue, and many make mistakes trying to “optimize.” In the majority of cases, I think these mistakes will overwhelm any marginal benefit you might get from asset location.
I appreciate that some people will disagree with me here, they same way some insist that holding four or five ETFs is better than holding one because of the tiny difference in MER. In the end, everyone needs to decide on the right balance of complexity versus convenience in investing, just like we do in other aspects of our lives.
Thanks Dan. But if someone is 100% equities there is surely something to optimize like for example US ETF in RRSP, Canadian ETF with canadian stocks in non registered and the one with the most potentiel in TFSA? So there is I think some big principles to put in application but I understand and respect your point!
@Charles: These are definitely things to consider as an investor with a large portfolio and a lot of experience. (Although I might argue that asset location is even less important in an all-equity portfolio than it is if you also hold fixed income.) You could also add things like Norbert’s gambit and tax-loss selling to that list. I’ve written about all of these at some length on this site, but I do not discuss them in the book. The book is not for total newbies, but it’s designed to help those who want to first get to “excellent” before striving for “optimal.”
I’m looking forward to picking up the kindle version when it’s available. Even though I’m a well seasoned index investor, I still like to read books on the subject matter, from different authors. I find it helps keep me on the right track, instead of allowing my mind to be sidetracked by the next shinny thing. So far, my favorite is Bogles little book of common sense investing. Although it’s US focused, the parts about reversion to the mean are quite insightful. Anyways… thanks for all the information you’ve provided over the years. Cheers. M.
@MIke: Thanks for the comment. Bogle’s book was one of the first to enlighten me as well! Kindle version should be available in December. Hope you enjoy it.
Dan I have been following your advice since 2012-2013 and it has changed my investment life. Like an earlier poster said, I may no longer be the target market, but I am buying this book, if only to support your work.
I am already planting the seeds of sound investment advice with my son. He’s is still too young to invest but he is already understanding the value of this and we have made plans to open his TFSA and RRSP self directred accounts on his 18th birthday.
Happy to see you back in action on this site.
@Al: Many thanks for the comment, and hope your son enjoys the book!
I liked so much the book that I spent a little more than a week (part time) to make a French summary for my personal use. I remember that someone asked if there was to be a French translation. My summary has 54 pages (and the book has 207 pages). With Dan’s blessing, if someone would like to get a PDF copy of my summary, at no cost, just email me at richardparent99@bell.net.
@Richard: Many thanks for the comment, and glad you enjoyed the book. I’m fine with you distributing French summary. If it can help francophone Canadians, that’s great. Can you please send me a copy at mail@hht.df7.myftpupload.com? Many thanks!
Of course Dan, right now.
Like Al (Nov 23), as a complete novice I first encountered your advice and blog in 2012 when I retired, and was blown away by the clarity and obvious (in hindsight) logic of the principles of conservative, reliable investing that you laid out so clearly. Just as in Al’s case, your advice has since transformed my investing life.
Like many fresh Couch Potato converts, maybe because of the seducing clarity of the principles laid out, I initially made the mistake of trying to chase perfection, and was constantly trying to tweak perfection in location and tax considerations etc. Over the years I have come to terms with the optimization of convenience and practicality, and I have embraced Excellent rather than Perfect, and my investing life has become really boring, and I basically now don’t touch my investments any more, but my results are startlingly spectacular and consistent considering how little effort and thinking I now put into financial management; but that likely underplays the huge emotional commitment I had to make initially to firmly ignore my prior highly emotional and irrational approach to investing that, of course, was constantly fanned by the feverish advice dished out in the Financial section, which I now skip reading entirely.
Thank you from the bottom of my heart for all the anxiety and uncertainty I no longer experience with each changing financial headline. Your advice has been so thorough that I guess there is really very little more to learn except for minor details and updates. Nevertheless, I will purchase your book for a quick peek to reinforce my understanding of the principles, before gifting it to my Son-in-Law, who will gain a lifetime treasury of wealth and financial reassurance if he gets even a fraction of the insight that I got from your clear advice.
PS: This stuff should be taught in school. But then it is a hard, hard sell, as I have found out, talking to supposed experts.