Hi sunshine, I only use ETFs for the stock allocation. I think the most appropriate are ZCN and XIC because they track the benchmark index (S&P TSX Composite), they are fairly large and liquidity is okay. Their MER is 0.06%. I have made my own backtest since 1970 for the Canadian PP and the real...

To make the best use of a pension plan, fill it with investments for the Permanent Portfolio in the following order: 1. Treasury bills or money market funds 2. Treasury bonds 3. Stock-market mutual funds 4. Gold Does anyone know why Harry's advice was to shelter T-Bills in priority over Bonds? Inte...

Hi europeanwizard, I would get 30 year Dutch bonds for the bond part if I was Dutch. They are currently yielding a little over 1% (source https://ca.investing.com/rates-bonds/netherlands-government-bonds?maturity_from=60&maturity_to=290) which can easily go lower in a deflationary event; for com...

Alright so after a week of mulling this over I opened an RRSP. Having gone through a lot of information and reflecting on scenarios for the future I think it makes sense and for the most part my initial concerns can be resolved. Let's go through the list again: 1. (About the risk of higher taxes at ...

I've read a ton about investing but never came across these considerations before... It seems trying to have a neat and simple portfolio across all of these different accounts (RRSP, TFSA, Taxable, Institution1, Institution2, and foreign account if you are going to follow all the PP's rules) takes s...

Apparently the assumption in my last question may be correct, as explained here: http://www.retailinvestor.org/rrsp.html#aa (see 'Asset Allocation Weightings') (I didn't really get it the first time...) Asset Allocation Weightings How you weight different asset classes to effect your desired asset a...

Ochotona: thanks for the calculation. I have found a great resource for making tax-deferred account decisions: http://www.retailinvestor.org/rrsp.html This website has a spreadsheet to calculate the benefit/penalty of using an RRSP depending on your tax rate when you contribute and withdraw, your ra...

Yes there are provisions for 'unlocking' locked-in retirement accounts in case of hardship. However this would not apply as RRSPs initiated on your own are never locked-in. You can withdraw as much as you want at any time, and whatever you withdraw is added to your yearly income and taxed as such. A...

ochotona,

The maximum contribution for RRSPs is 18% of the yearly income so yes the tax-deferred account would only be for a fraction of our savings. There are no sales tax on gold in Canada, and capital gains are taxed at half your marginal rate.

Hi all, I am undecided about whether or not I should open a tax-deferred account. Here in Canada we have RRSPs, which are roughly equivalent to US 401k’s/IRAs. So far I have avoided them (not having spent a lot of time studying the question I admit), because: 1. I don’t like the fact that what’s in ...

One cannot escape the fact that believing one can predict what an asset will do is in effect saying that one is smarter than the market (as Harry Browne said). Are all the people pushing yields that low (banks, pension funds, insurance companies, states, fund managers, etc.) really dumb or completel...

Alright so I asked the question to the author of this book: http://www.amazon.ca/In-Your-Best-Interest-Ultimate/dp/1550028766 Here is what he said: The 2045 maturity is what is known as an on-the-run issue which means that it is the most actively traded issue and is thus the benchmark for long term ...

Thanks for the info Austen. Unfortunately we don't have the equivalent of treasury direct in canada, and we have to get bonds on the secondary market through brokers. Those price are from TD (second biggest bank). Now if you buy a 30 year bond and keep it 10 years, a 1.7% spread is roughly 0.17% per...

Hi all, Here are the yields for government of canada long bonds (from http://www.pfin.ca/canadianfixedincome/Default.aspx): http://s27.postimg.org/4z6m27ghv/Untitled2.png 1. Can anybody explain why the yield on the 2064 issue is lower than the 2048 issue? Or why the yield on the 2045 issue is lower ...

Your insights are all helpful. There seems to be 2 camps on this forum, those who think it's best to apply the portfolio to the letter and those who try to apply some critical thinking. HB's investment principles are genius and his writings are far above the rest, however I think believing that the ...

Thank you for the helpful replies. I agree with you ochotona and your combination of 7 year bonds and cash looks good to me. Desert, I like having 25% real cash separate from the bond allocation.

Thanks for your replies. I am aware that rates are negative for short term bonds in some countries like germany and switzerland (not yet for 30 year bonds). I have a hard time to fathom this negative rates thing. To me, at this time the long term bonds allocation conflicts with rules #9 and #16: Rul...

Hi all, I just read Harry Browne's 'why the best laid investment plans usually go wrong'. In chapter 18, he wrote: Volatile stock-market investments, long-term Treasury bonds, gold, and Treasury bills combine to provide balance and safety. Apart from Treasury bills, each has the ability to rise by m...