Exactly three months ago my Weekend Reading update was all about staying the course amidst a big stock market sell-off. I got into it with a bearish reader in the comment section who labelled my advice too naive as Trump set fire to long-standing alliances and global trade.
Well, well, well, how the turntables…
Zooming out, the first half of 2025 delivered another solid stretch for investors, building on the strong rebound we saw throughout 2023 and 2024. Despite ongoing concerns about global trade upheaval, geopolitical turmoil, and an AI bubble, markets have largely shrugged off the headlines and continued climbing.
To check in on how a diversified investor might be doing this year, I took a look at the performance of Vanguard and iShares’ all-in-one asset allocation ETFs. These ETFs come in a range of flavours – from conservative to growth-oriented – and offer a good proxy for how a typical hands-off portfolio might be performing.
Here are the year-to-date, 1-, 3-, and 5-year annualized returns for each ETF as of June 30, 2025:
Vanguard Asset Allocation ETFs:
- VCNS (40/60):
– YTD: 3.46% | 1Y: 10.60% | 3Y: 9.01% | 5Y: 4.91% - VBAL (60/40):
– YTD: 4.32% | 1Y: 13.26% | 3Y: 12.02% | 5Y: 7.87% - VGRO (80/20):
– YTD: 5.00% | 1Y: 15.76% | 3Y: 15.02% | 5Y: 10.83% - VEQT (100% equity):
– YTD: 5.87% | 1Y: 18.48% | 3Y: 18.09% | 5Y: 13.83%
iShares Asset Allocation ETFs:
- XCNS (40/60):
– YTD: 3.46% | 1Y: 11.07% | 3Y: 9.73% | 5Y: 5.49% - XBAL (60/40):
– YTD: 4.46% | 1Y: 13.23% | 3Y: 12.51% | 5Y: 8.26% - XGRO (80/20):
– YTD: 5.57% | 1Y: 15.92% | 3Y: 15.54% | 5Y: 11.11% - XEQT (100% equity):
– YTD: 6.43% | 1Y: 18.35% | 3Y: 18.43% | 5Y: 13.90%
As expected, the more aggressive asset mixes (like VEQT and XEQT) have posted the strongest returns over all time frames – especially with global equities continuing to power higher this year. But even the conservative portfolios are doing just fine, which is encouraging for retirees and anyone drawing down their portfolio.
This is your regular reminder that staying invested through ups, downs, headlines, and hype continues to be a winning strategy. You don’t need to predict what happens next – just keep showing up with a disciplined approach and let the market do the heavy lifting.
This Week’s Recap:
My latest net worth update had us oh-so-close to the $2M milestone, thanks to the strong market performance mentioned above.
I also wrote about mental accounting and how our money mind plays tricks on us.
Finally, a sober look at investing sensibly in your TFSA.
Switching over to MoneySense, I wrote about seven TFSA myths that refuse to die.
And, on Tangerine’s Forward Thinking blog, I explained how RRIF’s work.
Promo of the Week:
In my net worth update I casually mentioned that I’ve moved our kids’ RESP over to Wealthsimple. Now we have both our RRSPs and TFSAs, my LIRA, and our kids’ RESP on the Wealthsimple self-directed platform.
Moreover, our clients are loving the Wealthsimple platform as well. Whether it was an enticing transfer bonus, or they were just tired of getting nickel-and-dimed by the big bank platforms.
And I’m more apt to recommend it (especially for retirees) now that Wealthsimple has solved many of its early issues. They’ve expanded their account type offerings (family RESPs, spousal RRSPs, LIRAs, RRIFs & LIFs), improved customer support, and added neat automations such as recurring investment purchases and automatic dividend reinvestment with the tap of the app.
Why is it good for retirees? If you’re drawing down your RRSP and have not converted to a RRIF yet, most financial institutions charge a partial deregistration fee of $25 + HST (Questrade charges $50) per withdrawal.
Wealthsimple does not charge that fee, nor does it charge any trading commissions for buying or selling stocks and ETFs.
If you’re making regular monthly withdrawals from your RRSP, moving to Wealthsimple could save you up to $600 per year in fees.
It can’t hurt to check them out and see for yourself – open a Wealthsimple account here.
Weekend Reading:
With markets rebounding to new highs again, Ben Carlson answers the age-old question about investing at all time highs.
Dan Hallett looks at whether covered call strategies shine in “flat markets”.
If you lose money in the stock market, do you double down? Preet Banerjee says that’s called a martingale strategy, and it’s dangerous.
Anita Bruinsma says that despite tariffs, taxes and global turmoil, you shouldn’t stop investing in the U.S. I agree.
David Chilton and Adam Bornn discuss retirement planning for Canadians on the latest The Wealthy Barber podcast:
Speaking of retirement, here’s another advice-only planner Jason Heath explaining what you need to know about CPP, OAS and tax planning if you want to work past 65.
Just because you can DIY your finances doesn’t always mean you should. Here’s how to know when you need help.
For homeowners, borrowing money is easy. But how do renters borrow money?
Finally, should clients add kids to their home title? Misconceptions abound.
Have a great weekend, everyone!
