As a relatively new investor, I have been researching many strategies and portfolio allocations The most common recommendations I have come across usually consist of a mix of $VFV, some global diversification, and often $QQC for a higher risk sleeve. I have a big issue with this My main skepticism for allocations like these are mainly rooted in the state of the current S&P 500. Market breadth (how many stocks are taking part in a market move), is notably low with roughly 59% of stocks trading below their 200 day average. This indicates a downtrend of the majority of holdings while a few big holdings give the illusion of general growth. A large part of this is due to the current weightings of the top 10 stocks being responsible for about 39% of the index. To put it simply, our current US market is extremely top heavy, which I view as an unnecessary risk to hold These conditions have caused me to draw two conclusions with how I could move forward: 1. Dispose of VFV and concentrate into QQC, where majority of market growth is happening. 2. Disregard the US market ETFs (for now) and locate a new strategy. I found that I am not comfortable with the increased risk of concentrating into mega cap tech, so I chose to research the latter. When searching, I realized I was not confident in how most indices are weighted, based solely on market cap with no fundamental basis to justify their picks. I decided to look for a portfolio of diversified ETFs that had a strict and concise reasoning for each of their holdings. This led me to pick a structured portfolio that focuses on fundamental factors within the market, with the factors being quality (stable earnings & low debt), momentum (strong uptrend and further growth opportunities), and value (cheap relative to earnings). My thesis is that these factors will provide me a cushion of logic and rationale that the S&P 500 does not provide as of now. After backtesting allocations and controlling risk (or at least attempting to), I have created this portfolio: 28% Core Growth Engine •$XEQT 28% Value Factor •16% $FCUV •12% $VXM 28% Momentum Factor •16% $FINN •12% $VMO 16% Quality Factor •$ZUQ I call it QuMoVa (cue-moe-vah), short for Quality-Momentum-Value My plan is to convert the rest of my holdings to this target allocation, then continue to dca long term ***I recognize that FINN is not specifically momentum targeted, but I believe it acts as a quasi momentum fund, capitalizing on strong growth opportunities in promising companies. This is largely due to a personal bias and expect people to disagree on this. An alternative would be $FCMO*** I would love to hear your thoughts on this, and I will gladly answer any questions This is not financial advice, just something I am trying for myself😉 Thank you for reading!
774 views
2 Comments
Rate My Portfolio
@ratemyportfolio · 15d
I would replace VFV with XEQT. Also, a lot of these funds have a lot of overlap, did you give that consideration? I love your analysis and your approach to putting this together! All the best!
Beevis
@beevis · 21d
Thanks for sharing Braydan! Here's my feedback: 1. 📊 Clarify how much you still rely on U.S. mega‑cap tech 2. 🏦 Reassess your Canadian bank & financial concentration 3. 🛡️ Check if your risk level matches your TFSA goals Including my full thoughts below, shoot me a message if you wanna chat about it!
See the full comment section 👀Sign up for the full Blossom experience!
