Introduction
Investors today are increasingly turning towards ETFs (Exchange-Traded Funds) for diversified and low-cost exposure to the market veqt stock. One standout in the ETF space is Vanguard’s All-Equity ETF Portfolio (VEQT), designed for individuals seeking long-term growth through a globally diversified, all-equity portfolio. If you want to learn more about how VEQT works and whether it’s right for your investment goals, this guide has you covered.
What is VEQT?
VEQT is a one-ticket solution ETF offered by Vanguard, focusing on 100% equities without exposure to bonds or fixed income. The ETF offers exposure to markets worldwide, including Canada, the U.S., Europe, Asia, and emerging markets. This product is tailored for investors with a higher risk tolerance and a long-term investment horizon.
Here are some key facts about VEQT:
- Ticker: VEQT
- Inception Date: February 1, 2019
- Management Fee: 0.22%
- MER (Management Expense Ratio): ~0.24%
- Currency: CAD (but the underlying holdings include international equities in different currencies)
VEQT’s Portfolio Composition
VEQT offers exposure to thousands of individual stocks through its underlying holdings. Its primary focus is on maximizing growth by providing exposure to both domestic and international equities.
Breakdown of the Allocation:
- Canadian equities: ~30%
- U.S. equities: ~40%
- International developed markets: ~20%
- Emerging markets: ~10%
The heavy weighting towards Canadian equities caters to investors looking for home-market exposure, while international stocks provide global diversification.
Why Choose an All-Equity Portfolio Like VEQT?
VEQT is designed for those seeking capital appreciation over the long term. However, this comes with higher volatility since the portfolio lacks bonds, which typically serve as a cushion during market downturns. Below are some of the reasons investors choose VEQT:
- Diversification: Exposure to multiple markets and thousands of stocks.
- Simplicity: One-ticket portfolio—no need to manage multiple ETFs yourself.
- Low Fees: The management fee of 0.22% is lower than actively managed funds.
- Long-Term Growth Potential: With 100% equities, VEQT is suited for investors with a 10+ year horizon.
Performance and Risks
Since VEQT is 100% invested in equities, its performance is closely tied to the global stock market’s performance. While the portfolio has shown strong growth during bull markets, it can also experience significant drawdowns during market corrections and bear markets. Investors need to have the patience and risk tolerance to ride through volatility.
Historical Performance
While past performance does not guarantee future results, VEQT has historically provided competitive returns relative to other all-equity ETFs since its launch in 2019.
- 5-year annualized return: ~7-9% (based on market averages)
- Best Year: +25%
- Worst Year: -10 to -20% (during market downturns)
Who Should Invest in VEQT?
VEQT is best suited for:
- Young investors with a long investment horizon.
- Retirees or near-retirees with additional income streams or pensions who don’t require bonds.
- DIY investors looking for a hands-off, globally diversified portfolio.
This ETF may not be suitable for those seeking income, low volatility, or a shorter time frame. If market downturns keep you awake at night, a more conservative ETF with some bond allocation might be a better fit.
How to Buy VEQT
VEQT is available on major Canadian exchanges and can be purchased through:
- Online brokers such as Questrade, Wealthsimple, or TD Direct Investing.
- Robo-advisors offering ETF portfolios that include VEQT.
- Registered accounts such as TFSAs, RRSPs, and RESPs for tax-advantaged growth.
You can buy VEQT in the same way as individual stocks by placing a market or limit order. Many brokers in Canada offer commission-free ETF trades, making it even easier to invest in VEQT.
Pros and Cons of VEQT
Pros | Cons |
---|---|
Low-cost, globally diversified | No exposure to bonds (higher risk) |
One-ticket solution for growth | Currency risk (due to international holdings) |
No need to rebalance | Can experience significant drawdowns |
Long-term capital appreciation | May not suit short-term investors |
VEQT vs. Other ETFs: How Does it Compare?
There are several other popular ETFs that compete with VEQT in Canada. Here’s a quick comparison:
ETF | Equity Allocation | MER | Bonds? | Best For |
---|---|---|---|---|
VEQT | 100% | 0.24% | No | Growth-oriented investors |
VGRO | 80% Equity / 20% Bonds | 0.24% | Yes | Balanced investors |
XEQT (iShares) | 100% | 0.20% | No | Growth with slight fee advantage |
VEQT distinguishes itself by providing home bias with more Canadian exposure compared to competitors like XEQT. However, investors should consider their own preferences when comparing these products.
Conclusion: Is VEQT Right for You?
Vanguard’s VEQT ETF is a great option for long-term, growth-oriented investors who are comfortable with volatility and want a globally diversified portfolio in one fund. Its simplicity, low cost, and focus on capital appreciation make it a popular choice among DIY investors.