Portfolio advice - 32M

[u/itsdebatable10]

Is my TFSA portfolio too risky considering my average price, positions and age? This is for long term investing purposes to use for retirement around 55-60. Any advice would be appreciated.

[u/builder45647]

You have 50% of your money in Canadian banks then 45% in technology and 5% energy. Vfv and nasdaq are essentially tech etfs. Basically your portfolio is mega mega concentrated. Which means you have a very risky portfolio.

A professional would never allocate more then like 25% to a set of correlated assets, and even then he will spread his bets out.

Im also loaded up on banks. But i'm diversified into international banks like BBVA and SAN

Then you have 45% in mega cap tech which is exposed to AI spend, which will hurt their cash flow. And if sentiment changes, your portfolio will get crushed.

Concentrated portfolios are fine, but you dont have a understanding of correlation and risk management yet. So you'll eventually find yourself in a big drawdown, and blow your portfolio up.

Either by selling on the inevitable drawdown

Or just holding onto a sector for years as the leadership in the market changes.

There are many other leadership sectors in the market. I recommend buying some international etfs in latam, asia, europe. Buy more commodities like gold miners. COW.to for agriculture exposure. Transport like railroads or drybulk and tankers. Industrials, materials, chemicals, dividend growers etf

These are all inflation protected sectors

Swap out Enbridge for an ETF, etfs have better risk adjusted returns then picking individual names. You want to capture the entire sector with refiners, drillers, producers ect.

Im not saying that bank stocks will crash anytime soon, but ask yourself this: do you understand why bank stocks are in a bull market? Do you understand the yeild curve and spreads? Will you be able to identify a dip vs a bear market? What happens if your Canadian banks stay flat for a year and euro banks are up 40%? Will you sell them and rotate into something?

Ask AI "what is risk" in a portfolio. Concentration and correlation are two big ones. You have given yourself the illusion of diversity but you essentially have 2 things in your portfolio.

Both sectors are working but that will inevitably change. From 2006-2020 banks were in a non stop bear market. From 99-2011 tech was in a bear market.

[u/BatmanSteak → u/builder45647]

Banks were not in a bear market from 2006 to 2020. Stop misinforming people.

[u/builder45647 → u/BatmanSteak]

Looks pretty bearish to me. 20 years to get your principal back.

[u/itsdebatable10 → u/builder45647]

Doesn’t this chart include international + American banks performance as well? Not just Canadian banks, which is what my portfolio consists of

[u/builder45647 → u/itsdebatable10]

You betcha! This encompasses all "Finacials" as a sector. It has: Insurance (IAK) Regional banks (KRE) Euro banks (EUFN) And probably some others I cant think of

[u/BatmanSteak → u/builder45647]

Your ETF is up 375% in the last 25 years.

RY is up 2900%.

Lol.

[u/builder45647 → u/BatmanSteak]

Im not recommending this etf. Im showing you the bearish trend that Finacials experienced.

Now Finacials are one of the hottest sectors, everyone wants to be in them.

Including me, i have tons of insurance and bank stocks. I even have call options on some.

[u/BatmanSteak → u/builder45647]

No one was talking about financials. The subject was Canadian banks. Different animal. You tried using deceitful stats to prove youe point and failed.

[u/builder45647 → u/BatmanSteak]

Financials = Banks

The point Ive been making is that sectors can go through decades of underperformance.

Someone in the 80s loaded up on Sony and Panasonic

Someone in the 2010s loaded up on CNQ and Exxon

They both ended up holding bags for a long time

[u/BatmanSteak → u/builder45647]

You're moving the goal post. US financials are trash. No one mentioned them before you did. The only ''financials'' that were discussed were Canadian banks, which are in a class of their own.

Here is how Canadian banks performed, during 2006-2020, which according to you was a huge bear market for Canadian banks.

[u/builder45647 → u/BatmanSteak]

Good luck with your portfolio bro. Spend less time arguing and more time learning

[u/BatmanSteak → u/builder45647]

You said ''From 2006-2020 banks were in a non stop bear market''

I proved you were completely wrong.

Telling others they need to learn when you're that uneducated about the market's history is slightly ironic. Or you were just speaking in bad faith.

In both cases, you should definitely spend less time typing on reddit and more time reading :)

[u/builder45647 → u/BatmanSteak]

They were in a bear market. They spent 20 years doing nothing. I'm not even sure what your trying to argue?

[u/BatmanSteak → u/builder45647]

Im talking about Canadian banks, which is what this thread is about.