This article is copyrighted by: https://www.youtube.com/watch?v=9x_-TKx3FJM. If there are any infringements, please inform us.

High Five ETF Portfolio Investment Strategy Sharing

Introduction

Today, I will share five ETFs that "never need to be sold." The goal of selecting these five ETFs is to meet three conditions:

1. Maximize the benefits of economic development in the U.S. and globally
2. Earn the easiest money
3. Let the market pay me a salary

I call this portfolio of five ETFs the "High Five Portfolio."

Detailed Introduction to ETFs

1. RSP - S&P 500 Equal Weight ETF

• Issuer: Invesco (the fourth largest ETF issuer globally)
• Expense Ratio: 0.2%
• Tracking Index: S&P 500 Equal Weight Index
• Key Metrics:
  • PE: approximately 16 times
  • Dividend Yield: approximately 1.6%
  • Ten-Year Compound Annual Return: approximately 11% (as of Q2 2023)

Features:

• Invests in the 500 most valuable companies in the S&P 500 Index
• Uses equal weight allocation, rebalanced quarterly
• Has a survival of the fittest mechanism to maintain index quality

2. IWY - Russell Top 200 Growth ETF

• Issuer: BlackRock (the largest ETF issuer globally)
• Expense Ratio: 0.2%
• Tracking Index: Russell Top 200 Growth Index
• Key Metrics:
  • PE: approximately 26 times
  • Dividend Yield: 0.69%
  • Ten-Year Compound Annual Return: 16.74% (as of Q2 2023)

Features:

• Invests in the largest and fastest-growing stocks in the U.S. market
• Holds 111 stocks, with the top ten holdings accounting for nearly 60%
• Broader stock selection compared to QQQ and XLK, with better logic

3. MOTE - Moat ETF

• Issuer: VanEck
• Expense Ratio: 0.46%
• Tracking Index: Morningstar Wide Moat Index
• Key Metrics:
  • PE: approximately 24 times
  • Dividend Yield: 0.99%
  • Ten-Year Compound Annual Return: 14.07% (as of Q2 2023)

Features:

• Invests in companies with sustainable competitive advantages
• Uses equal weight allocation
• Has reached a historical high in 2023, demonstrating its risk resistance

4. PFF - Preferred Stock ETF

• Issuer: BlackRock
• Expense Ratio: 0.46%
• Tracking Index: ICE Preferred Stock Index
• Key Indicators:
  • PE: Approximately 10 times
  • Dividend Yield: 6.87% (monthly dividends)

Features:

• Primarily invests in preferred stocks of large banks
• Provides stable cash flow income
• Risk-return profile between bonds and common stocks

5. VNQ - Real Estate Investment Trust ETF

• Issuer: Vanguard (the second largest ETF issuer globally)
• Expense Ratio: 0.12%
• Asset Size: Over $33 billion
• Key Indicators:
  • PE: Approximately 27 times
  • Dividend Yield: Over 4% (quarterly dividends)

Features:

• Invests in U.S. real estate trusts
• Provides stable rental income
• Highly influenced by economic cycles and interest rates

Investment Strategy

Allocation Method

• Equal-weight allocation among five ETFs
• Adopts a "buy and hold" strategy
• Suggested investment plan:
  • Initial Investment: $100,000
  • Monthly Investment: $1,000
  • Dividend Reinvestment
  • Annual rebalancing to equal weight

Portfolio Logic

1. RSP: Capture the overall economic growth dividends of the U.S. as benchmark returns
2. IWY: Focus on large-cap growth stocks for aggressive allocation
3. MOTE: Invest in companies with economic moats for defensive allocation
4. PFF and VNQ: Provide stable cash flow

Historical Performance

• Compound annual return over the past three, five, and ten years maintained around 10%
• Outperformed Ray Dalio's All Weather Portfolio
• Relatively low volatility and good stability

Case Analysis

Based on an initial investment of CAD 500,000, with a 10% compound return rate:

• Investment Period: 30 years
• Monthly Additional Investment: CAD 1,000
• Annual rebalancing
• Expected Final Asset: Approximately CAD 9 million

Note: Appropriately increase holdings during significant market downturns for potentially higher returns