Canadian Couch Potato

It has been a long time coming but I’ve finally decided to start up my Couch Potato portfolio. I recall reading about it when I became interested in personal finance but I didn’t quite know how to get started investing. The thing that got me interested in this investment strategy is the fact that it’s simple and easy to look after. And that’s what you need when you’re just starting out.

If you don’t know what the Canadian Couch Potato is, it’s an strategy for investing in mutual funds or exchange traded funds (ETF) that require little effort. I came across this strategy when reading an article by Dan Bortolotti in MoneySense magazine. And I started reading MoneySense magazine after listening to a few Mostly Money, Mostly Canadian podcasts by Preet Banerjee.

So far, I found that the quickest and easiest way to get started with investing using the couch potato was to open an account with TD. I’ve read that in the past it was difficult to open up a mutual fund account with TD and convert it to an e-Series account but I didn’t have any issues. So perhaps words got around and they fixed the problem. In my case, I simply walked into the bank, spoke with an account manager, signed some papers and was out of there in 15 minutes. It took about a week to convert the account so I can buy e-Series funds, though.

Along with tracking my net worth, I will also be tracking the e-Series funds. From what I’ve read, it’s important to rebalance the portfolio every now and then but it doesn’t need to be rebalanced that often. But as time goes, I will be tracking a whole lot more things. I am currently in the process of opening up a Questrade account but that will take a while because I need to transfer the initial funds.

Here’s what my initial investment looks like.

TD CDN Index-e: 4.078 @ $24.52 = $99.99
TD US Index-e: 2.463 @ $40.60 = $100.00
TD CDN Bond Index-e: 17.406 @ $11.49 = $199.99
TD Int’l Index-e: 8.873 @ $11.27 = $100.00

And here’s where they currently stand
TD CDN Index-e: $100.89 (+0.89%)
TD US Index-e: $100.84 (+0.83%)
TD CDN Bond Index-e: $200.34 (+0.17%)
TD Int’l Index-e: $101.24 (+1.23%)

I will have to rebalance this because I currently have an incorrect allocation mix. For someone my age, I should not have that high of a percentage in bonds. Oh well. It’s all part of the learning experience.