VEQT Review 2022: Vanguard All-Equity ETF Portfolio

Photo of author

by Enoch Omololu

Updated

Advertiser Disclosure

A one-fund solution ETF such as the Vanguard All-Equity ETF portfolio (VEQT) eliminates the hassle of rebalancing when you make new contributions or when portfolio assets perform at different levels.

Also known as “one-ticket funds,” these all-in-one solution ETFs are great for beginners and experienced investors alike and also offer:

  • Global diversification
  • Low management fees compared to mutual funds
  • Low-entry barrier with purchase possible using an online discount broker
  • Hands-free portfolio management
  • Accommodation for various risk profiles

This VEQT review covers its holdings, fees, pros and cons, how to purchase VEQT in Canada, and how it compares to XEQT.

What is VEQT?

This Vanguard ETF portfolio comprises 100% equity holdings and is the most aggressive portfolio in their line of all-in-one ETFs.

The Vanguard All-Equity ETF Portfolio “seeks to provide long-term capital growth by investing primarily in equity securities.” It is a fund of funds, meaning that the VEQT basket holds several other Vanguard equity ETF funds.

VEQT is traded on the Toronto Stock Exchange under the ticker symbol “VEQT” and was launched on January 29, 2019. Vanguard rates the risk (volatility) of VEQT as “medium”.

Some of its key facts as of April 8, 2022, include:

  • Net assets: $2 billion
  • Eligible accounts: RRSP, RESP, RRIF, TFSA, DPSP, RDSP, non-registered accounts
  • Management fee: 0.22%
  • MER: 0.24%
  • Listing currency: CAD
  • Return on Equity: 11.9%
  • Price/Earnings ratio: 14.3x
  • Price/Book ratio: 1.9x
  • Earnings Growth Rate: 7.6%

In addition to VEQT, Vanguard Canada also offers the following asset allocation ETFs:

VEQT Holdings

VEQT is an all-stock ETF and an aggressive portfolio. “Aggressive” in this case refers to the risk profile of the portfolio. It is more sensitive to market fluctuations than a “growth” or “balanced” portfolio.

If VEQT makes up 100% of your portfolio, you’d be expected to have an above-average risk tolerance and an investment plan to hold the ETF long-term.

As of March 31, 2022, VEQT had a 99.97% stock and 0.03% cash allocation. The underlying funds making up the portfolio as of this date are:

ETFAllocation
Vanguard US Total Market Index ETF43.77%
Vanguard FTSE Canada All Cap Index ETF29.96%
Vanguard FTSE Developed All Cap ex North America Index ETF19.19%
Vanguard FTSE Emerging Market All Cap Index ETF7.08%

The top-10 weightings for the stocks held by the funds are Financials (19.6%), Technology (17.5%), Industrials (12.4%), Consumer Services (11.9%), Healthcare (8.4%), and Basic Materials (6.9%).

VEQT consists of a total of 13,420 equity holdings with the top-10 as follows:

VEQT equity holdings
Source: VanguardCanada.ca

Related: Best Investment Accounts in Canada

A look at the geographical distribution or market allocation shows it is widely spread over 50 different markets as of March 31, 2022.

VEQT market allocation by geography
Source: VanguardCanada.ca

VEQT Returns

As of March 31, 2022, the fund has returned -3.83% year-to-date and 47.44% since inception based on its market price.

VEQT returns and performance
Source: VanguardCanada.ca

It is important to add a disclaimer at this point that historical returns do not guarantee future results.

VEQT Fees

VEQT has a 0.22% management fee and its management expense ratio rounds up to 0.24%.

This fee structure is significantly lower compared to what you pay for a similar equity mutual fund which can top 2% in annual fees.

If you opt for a robo-advisor to help you manage your portfolio, the average fee is approximately 0.70% (e.g. Wealthsimple Invest).

You can save on investment fees by purchasing ETFs directly using a discount brokerage account.

With all-in-one ETFs, you are spared the hassle of rebalancing, however, you should take note of the trading fees. If your broker does not offer commission-free trading, your overall investment costs can become expensive.

Commission-free ETF purchases are offered by Questrade. Wealthsimple Trade extends the no-fee trading to stocks as well.

Review: Questrade vs. Wealthsimple

Benefits and Downsides of VEQT

I hold VEQT and love that is truly hands-free. I don’t have to worry about re-aligning target allocations when I invest new money, and it works for my long-term retirement account.

Also, since I have no plans to sell any portion of my holdings soon, I don’t need to worry about incurring trading fees.

On the flip side, you should note that VEQT is an all-equity portfolio. As we have seen in recent times, when the stock markets go crazy, investors with higher weighting in stocks will experience greater fluctuations in the value of their portfolios.

There are opportunities to save a little bit of extra money if you are okay with holding a basket of two or more different low-cost Vanguard index ETFs and rebalance them when needed.

An equivalent all-in-one fund such as the iShares Core Equity ETF Portfolio (XEQT) offered by Black Rock has a lower 0.20% management expense ratio.

How To Purchase VEQT in Canada

You can easily purchase VEQT using Questrade or Wealthsimple.

1. Questrade: ETF purchases are free, however, you incur a trading commission when you decide to sell ($4.95 to $9.95 per trade).

Questrade is available via a web interface on your computer, tablet, or smartphone. They also have a decent mobile app. This brokerage platform is very versatile and offers access to real-time stock quotes, and multiple financial products including options.

To get started, open an account here and use our promo code SAVVY50 to get $50 in free trades after you fund your account with at least $1,000.

Questrade

questrade logo

Trade stocks, ETFs, options, etc.

Low and competitive trading fees

Top platform for advanced traders

Get $50 trade credit with $1,000 funding

2. Wealthsimple Trade: This trading app is offered by Wealthsimple, a leading robo-advisor platform in Canada. It offers free trades (both buy and sell) for ETFs and stocks.

Wealthsimple Trade is available as a mobile app and desktop platform.

Wealthsimple Trade

wealthsimple logo

Trade stocks and ETFs for free

Available on all devices & legit

Great trading platform for beginners

$150 cash bonus when you trade $300

VEQT vs. XEQT

Launched on August 7, 2019, XEQT is an all-equity ETF portfolio offered by BlackRock. Similar to VEQT, the fund is 100% stocks and seeks to provide long-term capital growth.

XEQT is made up of four underlying ETFs including:

  • iShares Core S&P Total U.S. Stock ETF (ITOT)
  • iShares MSCI EAFE IMI Index ETF (XEF)
  • iShares S&P/TSX Capped Composite ETF (XIC)
  • iShares Core MSCI Emerging Markets ETF (IEMG)

XEQT has a management fee of 0.18% compared to 0.22% for VEQT, and an MER of 0.20% compared to 0.24% for VEQT.

Is VEQT a Good Investment?

VEQT is designed for investors who have an above-average risk tolerance and who are okay with a portfolio that is entirely invested in stocks.

An all-equity portfolio such as VEQT will fluctuate in value with the market, however, the increased risk can result in higher returns over time.

Aggressive portfolios are not suitable for everyone.

Related reading:

Best Investment Offers This month

Get $50 in FREE trades or invest $10,000 FREE for 1 year

Offers self-directed and professionally managed portfolios.

No trading commissions on ETF purchases.

Low fees to buy stocks starting at $4.95 per transaction.

Free transfers from other banks and $0 inactivity fees.

Earn high interest rates on your savings accounts ($150 bonus offer)

1.65% interest rate on your savings account.

Up to 150x more earnings than other banks.

No monthly account fees; fast and easy online sign-up.

Free and unlimited bill payments and Interac e-Transfers.

Overall best crypto exchange in Canada + $50 bonus

Crypto trading platform for beginners and advanced traders.

Low trading fees at 0.20% and multiple fiat currencies supported.

Trade 16 popular cryptocurrencies.

$50 instant bonus when you deposit $200.

Get a cash bonus and FREE stock and ETF trades

First commission-free stock and ETF trading platform in Canada.

$0 trading commissions.

$25 cash bonus when you fund and trade $150 or more.

Search and track stocks easily with watchlists and price alerts

Retirement 101 eBook - 3D

Author

Photo of author
Enoch Omololu

Enoch Omololu is a personal finance expert and a veterinarian. He has a master’s degree in Finance and Investment Management from the University of Aberdeen Business School (Scotland) and has completed several courses and certificates in finance, including the Canadian Securities Course. He also has an MSc. in Agricultural Economics from the University of Manitoba and a Doctor of Veterinary Medicine degree from the University of Ibadan. Enoch has a passion for helping others win with their personal finances and has been writing about money matters for over a decade. He has been featured or quoted in The Globe and Mail, Winnipeg Free Press, Wealthsimple, Financial Post, Toronto Star, CTV News, Canadian Securities Exchange, Credit Canada, National Post, CIBC, and many other personal finance publications.

His top investment tools include Wealthsimple and Questrade. He earns cash back on purchases using KOHO, monitors his credit score for free using Borrowell, and earns interest on savings through EQ Bank.

6 thoughts on “VEQT Review 2022: Vanguard All-Equity ETF Portfolio”

  1. Which is better VEQT or XEQT does owning one over other have any Pros or Cons?

    • @Manoj: The ETF portfolio that’s better is the one that’s in line with your risk tolerance, returns expectation, and investment timeframe. It is impossible to rank one over the other without taking these three factors into consideration.

  2. From your previous VGRO review, you mentioned that there is no exchange fee.

    You also mentioned in this review that you hold VEQT. Do you pay US/CAD Exchange fee on VEQT? If no, then how Wealthsimple Trade earn its money from Vanguard ALL-in-One ETF portfolios ?

    • @Jacques: No, you don’t pay currency exchange fees when you buy VGRO, VEQT or VBAL. If you end up buying other investment assets listed in USD, WT makes some money from the FX fees. I guess you could consider the CAD listed products as “loss leaders”. I haven’t checked for Wealthsimple Trade, however, no-commission trading platforms in the U.S. also make money from selling the Order Flow to institutional investors, etc.

  3. Are there any Ex-Financials Socially responsible ETFs in Canada? Does any broker offer that at all ?

    In additional SRI interested in Ex-Financials but am not able to find it.

    • @Irfan: Wealthsimple has two SRI ETFs: WSRI and WSRD. I haven’t looked at them closely, but plan to review them soon.

Leave a comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

EXCLUSIVE OFFER
Get a cash bonus and trade stocks for FREE when you open a new Wealthsimple Trade account
* Terms & Conditions Apply. Fund account and trade at least $300. Applies only to Wealthsimple Trade accounts.
18 Shares
Share
Pin
Tweet
WhatsApp
Reddit