Can someone explain the difference between these two Vanguard products?
And any recommendation as which would be the better buy at this time?
Thanks in advance.
VGG or VGH???
- Peculiar_Investor
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Re: VGG or VGH???
Welcome to FWF.
However, most FWF posters are willing to share their time and expertise with new posters who are looking for help, but they can't or won't give advice in a vacuum. We need to know some important things about you, including all the investments you already have. Otherwise, we may be advising you to buy into a fund that overlaps your present holding(s), doesn't fit your asset allocation plan, or, worse, is either too risky or too conservative for your investing temperament. To make sure you get the help you need, we would like to provide a few suggestions. You might want to review My Portfolio: Seeking Advice and give some thought to providing a bigger picture view of what you are trying to accomplish with your investment plan before getting down to the specifics of choice between two similar investment products.
From what I can tell based on a quick review, the difference between U.S. Dividend Appreciation Index ETF (VGG) and U.S. Dividend Appreciation Index ETF (CAD-hedged) (VGH) is currency hedging. From our wiki article about Currency hedging, the general consensus is that for long-term holdings it is not recommended to invest in currency hedged products becausebeachcomber wrote: ↑27 Aug 2017 14:57 Can someone explain the difference between these two Vanguard products?
- over several decades, the currency fluctuations should even out;
- hedging adds to costs; and
- for Canadians, hedging may add to the volatility of portfolios.
Based strictly on the above, VGG would be the better choice.And any recommendation as which would be the better buy at this time?
However, most FWF posters are willing to share their time and expertise with new posters who are looking for help, but they can't or won't give advice in a vacuum. We need to know some important things about you, including all the investments you already have. Otherwise, we may be advising you to buy into a fund that overlaps your present holding(s), doesn't fit your asset allocation plan, or, worse, is either too risky or too conservative for your investing temperament. To make sure you get the help you need, we would like to provide a few suggestions. You might want to review My Portfolio: Seeking Advice and give some thought to providing a bigger picture view of what you are trying to accomplish with your investment plan before getting down to the specifics of choice between two similar investment products.
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Re: VGG or VGH???
Interesting that in this case both versions report an MER of 0.3%, so no apparent extra cost for the hedging.
Re: VGG or VGH???
My understanding is that hedging costs are not included in MER. It's not a fee that the manager charges - it's a trading cost to buy FX contracts and roll them over, etc. Would probably show up in the Tracking error and/or TER.fireseeker wrote: ↑29 Aug 2017 13:27Interesting that in this case both versions report an MER of 0.3%, so no apparent extra cost for the hedging.
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Re: VGG or VGH???
Thanks for the advice Peculiar. I wasn't really asking for financial advice. Just a clarification of the two products and a confirmation of my own thoughts.
I am a geezer DIY investor who has been around the investment block several times - and have the scars to show for it. Cut my teeth on VSE penny mining stocks over 50 years ago. Got into mutual funds when Templeton, AIC and Altamira were household names and Gordon Pape was our guru. Posted on the Wealthy Boomer (I think that's what it was called) as Clumpy. And recall bylo introducing us to Jack B. and Vanguard products - which couldn't be purchased in Canada at that time.
About 20 years ago after a ferry trip to Long Harbour and a visit with Norbert - who kindly reviewed my portfolio and graciously told me it was disaster - I spent many years consolidating all my investments into cash (tds) and PH&N funds.
PH&N has been great - but I am slowly moving into index funds and etfs. I have never been an early innovator/adapter
Cheers and thanks again
I am a geezer DIY investor who has been around the investment block several times - and have the scars to show for it. Cut my teeth on VSE penny mining stocks over 50 years ago. Got into mutual funds when Templeton, AIC and Altamira were household names and Gordon Pape was our guru. Posted on the Wealthy Boomer (I think that's what it was called) as Clumpy. And recall bylo introducing us to Jack B. and Vanguard products - which couldn't be purchased in Canada at that time.
About 20 years ago after a ferry trip to Long Harbour and a visit with Norbert - who kindly reviewed my portfolio and graciously told me it was disaster - I spent many years consolidating all my investments into cash (tds) and PH&N funds.
PH&N has been great - but I am slowly moving into index funds and etfs. I have never been an early innovator/adapter
Cheers and thanks again
- Peculiar_Investor
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Re: VGG or VGH???
Thanks for more background to the question, it's very helpful. BTW, Bylo and Norbert are still around here, although they don't visit/post as often these days.
finiki, the Canadian financial wiki New editors wanted and welcomed, please help collaborate and improve the wiki.
Normal people… believe that if it ain’t broke, don’t fix it. Engineers believe that if it ain’t broke, it doesn’t have enough features yet. – Scott Adams
Normal people… believe that if it ain’t broke, don’t fix it. Engineers believe that if it ain’t broke, it doesn’t have enough features yet. – Scott Adams
Re: VGG or VGH???
The name rings a bell.beachcomber wrote: ↑29 Aug 2017 17:54 Posted on the Wealthy Boomer (I think that's what it was called) as Clumpy. A
I was the same adrian2 over there.
finiki, the Canadian financial wiki
“It doesn't matter how beautiful your theory is, it doesn't matter how smart you are. If it doesn't agree with experiment, it's wrong.” [Richard P. Feynman, Nobel prize winner]
“It doesn't matter how beautiful your theory is, it doesn't matter how smart you are. If it doesn't agree with experiment, it's wrong.” [Richard P. Feynman, Nobel prize winner]