It was 10 years ago that I cut ties to our U.S. equity ETFs and purchased 15 of the largest cap stocks in the Dividend Achievers Index. Those 15 stocks were teamed up with three existing holdings – Apple, Berkshire Hathaway and BlackRock. The Achievers Index is available by way of Vanguard’s ETF – ticker VIG (in U.S. Dollars). It’s a real-life portfolio that holds the majority of our U.S. equity assets. The portfolio is public and has been tracked on Seeking Alpha from its inception. While the goal was never to beat the U.S. market over the longer term, it has certainy done so, besting the market by 2% annual. But that beat is due to an overweight in Apple and BlackRock and the success of a few tech companies such as Microsoft. Let’s take a look at our U.S. stock portfolio.
You’re probably wondering why the heck did I sell an index ETF and move to an 18-stock portfolio. The answer is two-fold. Well over 10 years ago I decided that I would research and write for Canadian and American self-directed investors. The goal being to somehow, eventually, do that full time and eke out half a living while helping investors.
At the time I was working at Tangerine Investments where I was an investment advisor and trainer. Tangerine offers some wonderful and simple index-based funds. They were Canada’s first Robo Advisor. Investors could do everything online from risk assessment and suitability to portfolio recomendation, but clients would often want to talk to a real live person / advisor. That’s where I came in.
For the record I left Tangerine in 2018 to start this blog – Cut The Crap Investing. As you know I cover building ETF portfolios and the ‘art’ of building U.S. and Canadian stock portfolios, retirement and more.
Self-directed investors
While I love index investing and ETFs and buying stock markets, that’s not how self-directed investors go about things. Most are hybrid investors. They hold a stock portfolio and layer in ETFs for greater diversification.
How could I write for self-directed investors if I did not understand how to build and manage a stock portfolio? Ya can’t. So as the result of many years of research on U.S. stocks and building a solid core large cap (blue chip) portfolio I went for it. And I went for quality and stability that can often be found by way of mega caps. At the time the Dividend Acheivers Index insisted on at least 10 years of continuous dividend growth. The index also applied financial health (quality) screens. The index that Vanguard moved to for the fund no longer applies quality screens.
Lower volatility and drawdowns
The main attraction of the index was the lower volatility and drawdowns in market corrections. VIG was launched in 2006 so it had to pass the biggest test of our lifetime – the financial crisis and recession of 2008-2009 and beyond. Here’s VIG vs the S&P 500, creating retirement income at a 4.8% spend rate, with spending increased at the rate of inflation.

More irony. During the financial crisis my main (advertising) client was ING Direct U.S. (ING Direct Canada became Tangerine). I lost my job when ING essentially went bankrupt. In Canada, ING Direct was sold to Scotiabank – a terrible stain for Canadian financial regulators. They allowed a disruptor to be gobbled up by a big bank ;(
Anyway, back to our portfolio. I had also studied the Dividend Achievers and Dividend Aristocrats moving through the dot com crash. The quality and low volatility benefit was even more pronounced during that correction that brought 3 years of negative returns for U.S. stocks, from 2000 – 2002. These types of stocks are more retirement-ready.
So reason #2 for moving to this stock portfolio was the prospect to outperform VIG.
Holding up when it matters
I wanted a stock portfolio that would stand up during times of market stress. That’s exactly when our U.S. stock portfolio started to deliver that outperformance – during and through the first modern day pandemic and the COVID correction. Even though that correction and recession was short-lived thanks to massive stimulus and rate cuts. I have not rebalanced, so admittedly that overweight Apple position (up over 1000% from my time of holding in 2014) has done some heavy lifting.

And here’s the stock holding’s performance from 2015 …

United Technologies (UTX ) was also in the original mix, but was merged with Raytheon (RTX) in 2020. UTX investors then held RTX and spin offs Carrier (CARR) and OTIS Worldwide (OTIS). The 3-stock UTX bundle has outperformed nicely. And while the total portfolio has moved to a period of underperformance over the last 3 years, as tech outpaces most everything, the UTX’ers have outperformed.

I was lucky enough to favour (for new monies) the best performer of the group, Carrier. I also gave Raytheon (defence and aerospace) new monies. War and defence needs does not seem to be on the decline, unfortunately. RTX might do well if Trump ‘makes’ NATO countries spend 5% of GDP on defence. It might do well if the U.S. attacks a NATO country such as Greenland (territory of Denmark). For the record, all NATO countries will be obliged to come to the defence of Greenland and Denmark. RTX is up over 7% over the last month 😉
Lessons learned
I can and will write pages on the lessons learned thanks to ‘managing’ this U.S. stock portfolio. It’s been quite easy to tell the truth. That’s my greatest lesson to share. When you start with enough quality companies you don’t have to watch too closely. You don’t have to spend hours monitoring each stock. You can buy and hold and add. Treat it like an index as much as you can. And sure along the way you’ll get some ideas on what looks good and what looks bad and what looks mediocre. Sometimes you’ll be right, and sometimes you’ll be wrong. It will all come out in the wash as the total mix (the greater portfolio) will drive your returns and risk.
Berkshire Hathaway and Warren Buffett
My greatest bias has been to overweight Berkshire Hathaway (BRK.B) in my wife’s spousal RRSP. It’s about 40% of the total portfolio. BRK.B has been outperforming from 2021. The world’s greatest investor is sitting on over $350 billion that he’ll put to work in any recession or major market correction. I really like that recession hedge. Sure, the stock will fall hard along with the market, but Mr. B will be loading up on quality companies at favourable valuations as fear takes hold. It might set the table for outsized free cash flow for a decade or two. A Warren Buffett legacy if you will, if he gets that chance.
I’ve already taken up too much space on our U.S. stock portfolio. I will write more on the subject. And I will put together a Zoom call for interested readers to answer questions and go over the many strange and wonderful events, of managing this portfolio over the last 10 years.
Use the Contact Form on this page if you’d like to sign up for that Zoom call.
So, let’s move on to …
The Sunday Reads
Dividend Hawk purchased 50 shares of Canadian Natural Resources last week. I think Mr. Buffett would approve of that ‘being greedy while others are fearful’ value hunting. Well done. In my TFSA I have also been chipping away at CNQ and other oil and gas favourites – SU, IMO and TOU. The U.S. will need our oil …
Simply put, America needs Canada’s oil. In 2023, the U.S. produced an average of 12.9 million barrels per day of its own crude, yet consumed an average of 20.2 million barrels. Imports make up the difference, and more than half of them now come from Canada.
Globe & Mail
At Banker on Wheels you’ll find the asset class returns by decade. Here’s the link that offers Aswath Damodaran’s yearly update of returns for stocks (S&P 500), bonds (10 year Treasuries), cash (3-month T-bills), real estate, gold and inflation going back to 1928. Small caps have been added this year. And I’ll also save you the trouble if you want see that table …

Also in the mix at Banker is the case for and against American exceptionalism.
The Loonie Doctor looks at the tax efficiency of Global X (formerly Horizons) HXDM vs XEF or ZEA for developed markets. Global X uses swap based and corporate structure ETFs as times. It is certainly a consideration for taxable accounts.
To stir things up a bit on the retirement front Ed Rempel points to a new study that suggests investors can stick to a 100% equity allocation throughtout life, even in retirement. The suggested mix is 33% domestic and 67% international. Here’s a key chart.

The key of course, is avoiding those extreme failure start dates. There are certainly moves you can make to help your chances on the front.
I will be back with a dedicated post on the aggressive portfolio for retirees. And that will be a topic for Retirement Club. We had our first Zoom Call this past week, and it was an incredible success say Retirement Clubbers. I had a blast. Use that Contact Form if you’d like more info and to get on the wait list for Retirement Club 2, that will set sail in March or April. We’ve also set up our Retirement Club content, tools and conversation hub on Mighty Networks.
It might be a challenging start date for those with a U.S. heavy (market centric) portfolio.
Where they keep the earnings growth
This a fascinating look at the Mag 7 and the S&P 493 earnings …
Last week I was back on Moolala chatting about Retirement Club and Vanguard’s ETF for retirees – VRIF.
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ETFs / Stock Portfolios / Retirement Strategies / Wealth Creation/ Retirement Club
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Retirement club list? Not sure if I’m already on from prev email or comment.
Hi Jo, I will check the list 🙂
Dale
Ed Rempel all equity advice related to Prof. Scott Cederburg’s studies? I’ve read two and read/ heard views for/against with SC’s self admitted limits incl real world and non US as domestic challenges to them on Rational Reminder videos.
Thanks Jo, it’s an interesting approach and topic. And risk tolerance would be the main concern. But it’s true that aggressive portfolios will usually ‘do better’. But we do have to avoid those bad start dates, and adjust if we land on them.
Dale
I would like to sign up for your zoom call about your us portfolio
Hi please forward me the Retirement Club outline and place me on the list for Club 2 thank you!
Good morning Dale – I followed you regularly ten years ago and have lost track of you. Glad I found you again. Having said that – I guess I can’t pick up on what you’re doing and duplicate it. It looks straight forward, however, I have taken an absolute bath on 3M, WBA, BBY and now WHR. I have underperformed SCHD and obviously SPY and QQQ drastically the last 10 years, and, don’t get me started on the bond bath I took as well – ouch. At my age, with 20 years of investing under my belt – maybe it’s simply time to say, for whatever reason, I suck at investing. That’s my story as of 1/31/2025. I do enjoy your takes on investing – I just can’t emulate it. I’m better off holding the basket.
Hi Kent, not advice but your instincts might be right. Most are best buying an index ETF. I like a mix of market and something more value oriented these days, such as that SCHD that you mention. I like XDU.TO in Canadian Dollars as well.
Thanks for stopping by, feel free to reach out at any time.
Dale
Thanks Dale – I appreciate the help!