Investing
The largest single line in my equity sleeve is not a company. It is XEQT, the iShares Core Equity ETF Portfolio, an all equity fund of five underlying iShares index funds listed on the Toronto Stock Exchange since 2019.
That is a deliberate choice and it is the least exciting one in the book, which is roughly the point.
Have A View Where You Have An Edge, Not Everywhere
One global all equity ETF carries the market exposure so the rest of the book can be concentrated on purpose rather than by accident.
I have no edge on the broad market. Nobody has offered me a reason to think otherwise, and the honest response to no edge is not a smaller position, it is no view.
So the index carries that part. What it buys is permission. Because the market exposure is already handled, the concentrated half of the sleeve can be genuinely concentrated instead of quietly turning into a worse index made of the fourteen companies I happened to hear about.
A portfolio that is only an index has no view in it at all. A portfolio that is only views has nothing underneath it. The index is the floor that makes the views affordable.
Cost Is The One Input You Know In Advance
XEQT has a management fee of 0.17 percent and a management expense ratio of 0.20 percent, as reported in BlackRock’s most recent management report. That is the all in cost of the fund of funds, not a fee stacked on top of the underlying funds.
Twenty basis points is what a single index fund used to cost. Cost is the one input in a portfolio that is knowable in advance, so it is the one worth being strict about.
Every other input is a forecast. Returns are a forecast. Volatility is a forecast. Your own behaviour in a drawdown is a forecast, and usually an optimistic one. The fee is a fact you can read before you buy.
Being strict about the one knowable input is not penny pinching. It is the only part of the outcome you control.
What The Fund Actually Holds
One hundred percent equities, held as five underlying iShares index funds covering roughly 8,300 companies across the United States, Canada, developed international markets and emerging markets. Distributions are quarterly.
That is one order instead of four, one line on a statement instead of four, and no rebalancing decision to get wrong. The full breakdown, with BlackRock as the source and the date it was read, is on the XEQT page.
The Discipline Is Not Buying It, It Is Leaving It Alone
Choosing an index fund takes an afternoon. Holding one through a year where a single name in the same account is up sixty percent is the actual work.
This is why the split comes first. If the index line has a job, and the job is carrying exposure you have no opinion on, then it underperforming your best idea is not evidence against it. It is the design working.
Nothing here is a recommendation to buy any fund. Every figure quoted is BlackRock’s own, cited and dated on the fund page.
Common Questions
Which index fund is it?
XEQT, the iShares Core Equity ETF Portfolio, listed on the Toronto Stock Exchange in Canadian dollars since 7 August 2019. It is an all equity fund of five underlying iShares index funds.
What does it cost to hold?
The management fee is 0.17 percent and the management expense ratio is 0.20 percent, as reported in the fund’s most recent management report. That is the all in cost of the fund of funds.
Why hold an index fund alongside individual stocks?
The index carries the market exposure I have no edge on, which lets the rest of the sleeve be concentrated on purpose rather than by accident. Without it, the concentrated half quietly becomes a worse index.
How many companies does it hold?
Roughly 8,300 across the United States, Canada, developed international markets and emerging markets, held through five underlying iShares index funds. Distributions are quarterly.
Is this a recommendation to buy XEQT?
No. It is an explanation of why one line exists in one published book. I am not a financial advisor and nothing here is advice.
