After New Regulations, Here’s How Canadians In Europe Can Build A Portfolio Of ETFs

In January 2018, a new European Union regulation rattled plenty of Canadian expats living in Europe.

Many had built diversified portfolios of low-cost ETFs.

They had taken such advice from multiple Nobel Prize winners in economics.

Warren Buffett is among the strategy’s supporters.

In fact, that’s how his personal estate (on behalf of his heirs) will be invested when he dies. He’s putting his money in a portfolio of low-cost index funds.

But EU regulators now say European residents can’t buy ETFs from the Toronto or the New York Stock Exchanges.

That doesn’t mean they can’t follow Buffett’s advice.

I’ll explain how they can.

Image by Pixabay

Click here to read how


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Andrew Hallam

I’m a financial columnist for Canada’s national paper, The Globe and Mail, as well as for AssetBuilder, a financial service firm based in Texas. I’m also the author of Millionaire Teacher: The Nine Rules of Wealth You Should Have Learned in School (2nd Ed. Wiley 2017) and The Global Expatriate’s Guide To Investing: From Millionaire Teacher to Millionaire Expat (Wiley 2015). My mission is to educate, motivate and inspire people on basic retirement planning and best practices for investing, using evidence-based strategies. I'm happy to comment on your questions. However, please read the Terms of Use, Privacy Policy and the Comments Policy.

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4 Responses

  1. Sara Macmillan says:

    Hi Andrew,

    Thank you so much for this article! My husband and I are expat Canadians who have read your books and followed your advice. The difficulty in investing in North American markets has been frustrating. We are using Internaxx as our broker, and we have been investing in Vanguard on the UK market. The Global Nomad portfolio you suggest in this article sounds perfect for us – but we need to readjust our investments. We are currently invested in:

    VDMO -Vanguard Funds PLC Global Momentum Factor USD

    VDCP – Vanguard USD corporate Bond UCITS ETF

    VDEM – Vanguard PLC FTSE Emerging Markers USD

    and

    VUSA – Vanguard S&P 500 UCITS ETF (because we are paid on USD)

    As we don’t know where we will retire, should we drop VUSA and concentrate more on the Global? Are the Vanguard choices okay?

    Thank you for your advice!

    Sara

    • Hi Sara,

      Your current portfolio will have high U.S. stock exposure. As such, you would be taking global market capitalization risk (the global index is allocated 50% to US stocks). In addition, your bonds would represent U.S. dollars too, instead of a more diversified allocation, so I recommend going international, as per my model, on that one. If you might retire in Canada, adding the Canadian stock index makes sense too.

      Cheers,
      Andrew

  2. Lisa says:

    Andrew,

    SMEA comes up as being traded in British Pounds, not Euros.
    IWDA comes up as being traded in U.S. dollars, not Euros.
    I’m using the Internaxx site to search for the stock symbols on the United Kingdom market. I’m doing something wrong?

  3. David Simpson says:

    Thanks for the informtion – for me the elephant in the room is a growing trend in governments’ agressive intrusion into what used to be personal choices – what is next , they dictate we can not eat bacon or women can not drive?


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