Wealthsimple follow-up
So I’ve been experimenting with the Wealthsimple app since I switched part of my portfolio there. One of the most fun features for me is the custom self-balancing portfolio account. I opened two different small ones and I chose a theme for each: the first one is in cad and based mostly on uranium mining. The second one, in usd, is based on Biotech. They are all pretty volatile stocks, so it’s crazy to see the violent movements almost every day.
The Biotech portfolio is at a total return of 25% after 3 weeks (ABCL = 104% last week). So this morning I was like: success! I’ll cash in the usd and start my next fun little themed usd portfolio experiment. That’s when I realized the flaw in my plan.
The way to sell the assets in these accounts, is to “withdraw” money (transfer to a different account). But they don’t really work well with usd assets, so they only want to transfer to a cad account, so I would have to convert usd assets to cad cash, then reconvert to usd assets for reinvesting. Hello fees.
Also, once I pulled the trigger on that withdrawal, they sent me a transaction receipt that said they’ll proceed to the liquidation of the assets in the next two days, so if the assets value changes, the amount of the transfer will move too. So basically I don’t get a say when the sale happens. My 25% return today could be 5% loss in two days.
Bottom line of my experiment: it was a nice idea, but next time, if I feel like making mini portfolios, I will build them in a regular non-reg, and rebalance manually as needed.
