Investing in Vanguard in Canada

[My Dream]

Ok, I know I've talked about this before and still today I'm getting mixed answers. I'm not that knowledgable about DIY investing but I'm trying. Now.........question is can a Canadian resident with no US address invest in Vanguard? I've been told by several members on this forum that YES Indeed I can, yet in Webring, I'm told NO you can't.

Who can tell me the correct answer?

 

[LOL!]

Vanguard offers many exchange-traded funds which should be available via any online discount broker --- even in Canada. Have you looked at tdwaterhouse.ca? Some Vanguard ETFs: VTI, VEU, VV, VTV, VB, VBR, VWO, VNQ. For equities, you don't really need much else except small cap international, do you?

 

[My Dream]

I joined TDW a couple of years ago, but members keep suggesting I join Vanguard. Since I'm with TDW, is there an added advantage with going to Vanguard funds?

 

[LOL!]

I'm not sure what you mean by your question. If you ask is there an added advantage to using Vanguard mutual funds over their ETFs, the answer is probably not. You will get a lower expense ratio in the ETFs at a cost of the commissions and the bid/ask spread. If you invest $50 a month, then the commissions will kill you.

If you ask is there an added advantage to using Vanguard ETFs instead of other possible investments. I think the answer is yes because the Vanguard ETFs will almost always have lower expense ratios than anything else.

 

[Meadbh]

I'm a Canadian resident with no US address. I have two TD Waterhouse accounts, a Canadian Margin and a US Margin. I don't have any Vanguard funds at present; my TDW accounts just contain individual stocks. To find the answer to My Dream's question I accessed my TDW account and looked up Vanguard under Symbol Lookup, and got a long list of funds. Then I started the order process for VWO. I didn't complete it because that's not my plan right now, but if I can do it, yes, it's possible.

 

[AltaRed]

I joined TDW a couple of years ago, but members keep suggesting I join Vanguard. Since I'm with TDW, is there an added advantage with going to Vanguard funds?

You are confusing 2 different things. As a Canadian and a Canadian resident, you cannot open and hold a US domiciled Vanguard account and you cannot buy Vanguard (US domiciled) mutual funds. But you can buy any of the Vanguard ETFs that you wish off the stock market - they trade like stocks on the US market. Vanguard ETFs are clones of their US mutual funds.

 

[My Dream]

Ok, then it was a matter of the they it was worded. Maybe that's what confused me.

Thanks LOL!, Meadbh and AltaRed.

It's going to take me some time, but I'm learning. Please be patient.

 

[kcowan]

Financial Webring is the definitive source for investing for Canadians. Good luck with your investment education.

 

[Red_y]

As a Canadian and a Canadian resident, you cannot open and hold a US domiciled Vanguard account and you cannot buy Vanguard (US domiciled) mutual funds.

I'm a US citizen and Canadian resident. I've been transacting happily in my Vanguard account, trading Vanguard mutual funds and buying non-Vanguard funds when the policy of the fund company allows purchases by non-residents (e.g. Fidelity-yes, Third Avenue-no, Loomis Sayles-no).

Today I received a letter from Vanguard saying their policy is changing. After 14 Dec 2007 I will no longer be able to purchase any Vanguard mutual funds in my retirement and taxable accounts. Dividends and capital gains can be reinvested, but no new purchases, exchanges, or automated systematic investments.

After 14 March 2008 the same restrictions will apply to my VG IRA brokerage account. I will also have to transfer assets from my taxable brokerage account to a Canadian brokerage.

I was going to start a thread to warn people about this when I saw this one. The title of my new thread was going to be:

VANGUARD TO US EX-PATS: DROP DEAD

 

[Meadbh]

VANGUARD TO US EX-PATS: DROP DEAD

Oh, it's probably just some Homeland Security paranoia.........

 

[bpp3]

Could be that they don't want trouble with the Canadian regulatory authorities. I wonder if they have done this to residents of any other countries besides Canada. (They wouldn't let me open an account in the first place, so not an issue for me.)

 

[My Dream]

Financial Webring is the definitive source for investing for Canadians. Good luck with your investment education.

Thanks for the suggestion, I joined there a couple of weeks ago. They can be a tough crowd at times, but hey, I'll get used to it..........I hope.