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What I’m Selling: ADRE, What I’m Buying: VEE

ADRE: Lingering for Years

ADRE is an emerging markets ETF that I’ve had lingering around my portfolio for years and it was actually one of the first things that I bought.

Why ADRE is not a Fabulous Emerging Market ETF (for me)

In recent years, I’ve discovered Vanguard and their fabulous line of ETFs, with the cheapest expense ratios in the industry. In addition, thanks to Andrew Hallam’s book, The Global Expatriate’s Guide to Investing, I’ve discovered that as a Canadian, it’s better to buy stuff off the Canadian exchange instead of the American ones due to estate taxes if I were to die.

Sell ADRE, Buy VEE, a Better Emerging Market ETF (for me)

So, I sold ADRE and added about $10,000 of Vanguard Canada’s VEE to my portfolio (about 7% of my total portfolio), which is an emerging markets ETF listed on the Toronto Stock Exchange.

Why ETFs in a Dividend Stock Portfolio?

Some of my readers may wonder why I’d want VEE in my primarily dividend paying stock portfolio. The reason is diversification.

Basically all the stocks I own are from developed countries, and more specifically the USA. I want some exposure to places like China, India, and Brazil because of the high growth potential, but I don’t want to hold individual stocks in those countries due to my extremely limited knowledge of their markets.

An ETF like VEE is the perfect solution. Risk is spread around, such that a weakness in any one country or company will not really effect my overall portfolio that much.

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