A month after TD GoalAssist App was introduced with new all-in-one ETFs, we’re getting another investment fund.
With the introduction of its Global ETF portfolios, Tangerine is giving Canadians one more option in a growing list of investment products.
But what are its features, how does it stack up against its competitors and should you move your investments into the new funds?
You will find out in this Tangerine Global ETF Portfolios review.
What are Tangerine Global ETF Portfolios?
The new Tangerine investment portfolio is an Exchange Traded Funds (ETFs) based fund that complements its existing Core Portfolios.
Investors have the option to select from 4 different portfolios with varying weights to stocks and bonds and exposure to over 45 countries.
The 4 portfolios are:
- Balanced Income ETF Portfolio: 70% bonds and 30% stocks
- Balanced ETF Portfolio: 60% Stocks and 40% Bonds
- Balanced Growth Portfolio: 75% Stocks and 25% Bonds
- Equity Growth Portfolio: 100% Stocks
Existing investors in one of the Tangerine Core Portfolios will notice that the stock and bond mix are similar.
One major difference is that the new Tangerine portfolios are built using ETFs and have lower management fees.
Tangerine Global ETF Portfolios Quick Facts
Here are some key facts about the Tangerine Global ETF Portfolios:Facts
- Date started: Nov 10, 2020
- Management and Admin Fees: 0.65%
- MER: 0.76%
- Distributions: annually in December
- Minimum investment: $0
- Fund Manager: Tangerine Investment Fund
- Portfolio Manager: 1832 Asset Management L.P.
Tangerine Global ETF Portfolios Fees
Apart from the annual management and admin fees of 0.65% and any other operating or trading costs incurred by the portfolio managers, there are no fees or commissions for buying or selling the units of the funds.
In other words, the transaction costs are $0 and there are no maintenance fees – even for registered accounts.
But if you decide to move your investment to another financial institution, you’ll have to pay a transfer-out fee of $125.
You may be able to get the fee refunded to you by the receiving financial institution, usually up to a cap. For example, Questrade will cover your transfer fees up to $150 transfer your account in. Check here for other financial institutions that reimburse transfer fees.
A quick note about the fund expenses:
A fund’s total fees is made up of different fees and expenses including:
- the management fee
- administration fees
- operating expenses
- trading fees and so on
The 0.65% above is just for the management and admin fees. After adding the other fund expenses, the Management Expenses Ratio (MER) is currently 0.76%.
Tangerine ETF Risk Levels
The risk of the portfolios will vary depending on the asset mix you choose.
The higher the allocation to equities in a portfolio, the higher its risk – all things being equal
According to Tangerine, the risk of each of the portfolios are:
- Balanced Income ETF Portfolio: Low to medium
- Balanced ETF Portfolio: Low to medium
- Balanced Growth ETF Portfolio: Medium
- Equity Growth ETF Portfolio: Medium to High
But what exactly does low, medium and high risk mean?
And who should invest in the Tangerine Global ETF Portfolios?
Here’s a handy guide (in simple English) from the funds’ prospectus:
Balanced Income ETF Portfolio: 70% Bonds and 30% Stocks
- You are looking to earn income and modest capital appreciation
- You want to invest your money for a medium or long term horizon
- You want to diversify your funds across different assets, sectors and countries
- You don’t mind some fluctuations in your investment (low to medium risk tolerance)
Balanced ETF Portfolio: 60% Stocks and 40% Bonds
- You want a balance between capital appreciation and income from your investment
- You plan to invest your money for the medium to long term
- You don’t mind some fluctuations in your investment (low to medium risk tolerance)
- You want a portfolio that is diversified not only by asset class (bonds and stocks) but also geographically
Balanced Growth ETF Portfolio: 75/25 Equity to Bond Mix
- You are more interested in capital appreciation, but some income is also nice
- Your time horizon is medium to long term
- You can accept swings or fluctuations in your investment value (medium risk tolerance)
- You want a portfolio that is diversified by asset class (bonds and stocks) and geography.
Equity Growth ETF Portfolio: 100% Equity
- Your main objective is capital appreciation
- You plan to invest your money for the long term
- You can accept volatility in your investment value (medium to high risk tolerance)
- You want a portfolio that is diversified geographically, but not by asset class.
|Portfolio||Balanced||Balanced Income||Balanced Growth||Equity Growth|
|Asset Mix (Equity : Bond)||60:40||30:70||75:25||100|
|Time Horizon||Medium – Long||Medium – Long||Medium – Long||Long|
|Risk||Low – Medium||Low – Medium||Medium||High|
Tangerine Global ETF Portfolio Holdings
Each of the portfolios are globally diversified with investments in over 45 countries.
According to the funds’ prospectus, the fixed income portion will be invested in Canadian dollar-denominated investment grade bonds while the equities allocation will include ETFs with exposure to the following:
- Canadian equities
- U.S. equities
- International equities; and
- Emerging markets equities
One of the biggest concerns with the Tangerine Core Portfolios is their huge “home bias” to Canadian stocks. That is, the allocation to Canadian securities is way higher than it should be given that they only make up about 3 percent of the global markets.
It was not clear if the newer Tangerine Global ETF Portfolios will be any different when they were introduced. But the fund releases its geographical allocations.
The table below shows the portfolio allocation by geography for the 4 portfolios as at February 2023:
|Asset Class||Balanced (%)||Income (%)||Growth (%)||Equity (%)|
|Emerging Markets Equities||6.83||3.36||8.49||11.21|
With the exception of the Emerging Markets Equities that is provided through iShares Core MSCI Emerging Markets IMI Index ETF, all the other ETFs are from Scotiabank.
Tangerine Global ETF Portfolios Performance
The table below shows the Tangerine Global ETF Portfolios performance for 1-year and since inception as of January 31, 2023.
|Portfolio||1-Year Return||Since Inception Return|
|Tangerine Balanced ETF Portfolio Performance||-5.10%||0.05%|
|Tangerine Balanced Income Portfolio Performance||-5.70%||-5.66%|
|Tangerine Balanced Growth ETF Portfolio Performance||-4.89%||1.36%|
|Tangerine Equity Growth ETF Portfolio Performance||-4.55%||3.66%|
The Tangerine Global Portfolios is still at the recency stage as it has not yet provided 3, 5 and 10-year returns. However, the available returns can be used to compare it with similar portfolios.
How to invest in Tangerine Global ETF Portfolio?
Getting started is simple and similar to how you would open any other account with Tangerine.
Simply visit the Tangerine Investment page and you’ll be prompted to login to your account if you’re an existing client or create one if you’re new.
You can open any of the accounts below:
- Non-registered account
- Tax-free Investment Fund (TFSA)
- RSP Investment Fund (RRSP)
- RIF Investment Fund (RRIF)
Related Post: How to start investing in Canada for Beginners
Tangerine Global ETF Portfolios vs Tangerine Core Funds
Both funds are from the same fund manager. One obvious difference is that one is built entirely using ETFs and is relatively cheaper.
The Tangerine core funds have an MER above 1%, lower than the average mutual funds fees, but higher than what you’ll get from robo-advisors like WealthSimple or Questrade (Questwealth Portfolios).
Tangerine Global ETF Portfolios vs WealthSimple
WealthSimple’s annual management fee starts at 0.50% for asset values below $100,000, or 0.4% when you go above that.
By the time you add the MER of the underlying ETFs that the WealthSimple portfolio is built with, about 0.2%, the total fees will be slightly lower than the management expense ratio of the Tangerine ETF Portfolios of 0.77%.
Tangerine Global ETF Portfolios vs Questrade (Questwealth Portfolios)
Questrade’s robo-advisor offering has a much lower total fee than either WealthSimple or Tangerine Global ETF portfolios.
Depending on your account value, the annual management fees for Questrade ranges between 0.20% and 0.25%. With the MER of the underlying ETFs, the total fees comes to about 0.40%.
That’s a big savings in fees and Questwealth Portfolio comes out on top if you’re deciding based on fees alone.
Questwealth portfolios are, however, actively managed unlike Tangerine portfolios that are passively managed.
You can get $10,000 managed for free in the first year using the link below.
Tangerine Global ETF Portfolios vs DIY Investing
You can keep your costs much lower with DIY investing if you invest using an online broker, especially one that lets you buy ETFs for free like Questrade.
However, there is some value to be had from letting professionals manage your investments. Plus you save some time and effort in the process.
If you’re sure you know what you’re doing, will be disciplined to stick to your plans, contribute to your portfolio regularly and not time the market, then DIY investing may be right for you.
Getting started is easy with options like Questrade or WealthSimple Trade.
And to make things a whole lot easier, consider investing using Asset Allocation ETFs. Your portfolio will be automatically rebalanced for you – one less thing to worry about.
Both Vanguard and iShares have a range of asset allocation ETFs that have gained popularity with Canadians looking to invest and build a low-cost diversified portfolio quickly.
The iShares offering have an MER of 0.20% while Vanguard has 0.25%. Depending on your risk tolerance, you can choose one of the 5 available options with varying exposure to equities and bond.
With a management fee of 0.65%, Tangerine Global ETF Portfolios lags behind both asset allocation ETF providers.
And if you’re looking for a conservative portfolio with minimal exposure to equities, you may have to look elsewhere.
Note that the Tangerine Balanced Growth Portfolio has a slightly lower equity allocation of 75% compared to VGRO and VEQT with 80%.
In terms of the performance, we’ll have to wait to see how the new Tangerine funds will perform in the coming years.
- Asset Allocation ETFs: How Do They Work?
- VGRO Review: Vanguard Growth ETF Portfolio
- VEQT Review: Vanguard All-Equity ETF Portfolio
Is Tangerine Global ETF Portfolios Safe?
Your investments are ineligible for deposit insurance by CDIC or any of the provincial or territorial deposit insurers.
But Tangerine Investment is a member of the Mutual Fund Dealers Association of Canada (MFDA) so your investments are protected up to $1 million through the MFDA Investors Protection Corporation.
Some FAQs on Tangerine ETF Review
Yes, Tangerine now offers 4 ETF Portfolios through its new Global ETF Portfolios
Tangerine ETFs are good because they are diversified across different assets, sectors, and countries, limiting your investment risk. However, the management fees and MERs of Tangerine ETFs are one of the highest out there.
Tangerine charges a management and administration fee of 0.65% and a management fee of 0.76% on all its ETF portfolios. These fees are among the highest in Canada.
The best ETF portfolio for each investors will depend on their specific financial situation and risk appetite. The portfolios have different allocation to equities so the risks will vary. You should pick the portfolio that best aligns with your investment goals and your risk tolerance
Final Thoughts on Tangerine ETF Review
I’ll update the review as more details become clear about the Tangerine Global ETF portfolios.
In the meantime, what do you think of the portfolios? Would you be giving them a shot? Or switch from the old Tangerine core portfolios?
Let me know in the comments.
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Tangerine Global ETF Portfolios
The Tangerine Global ETF Portfolio is an investment portfolio built using Exchange Traded Funds (ETFs). Investors can choose from 3 different portfolios with varying weights to stocks and bonds depending on their risk tolerance.
3 thoughts on “Tangerine Global ETF Portfolios Review: Updated For 2023”
How does Tangerine Global ETF Portfolio compare with Vanguard Balanced ETF Portfolio?
I am a senior in retirement
We can compare the Vanguard Balanced ETF Portfolio (VBAL) to the Tangerine Global Balanced ETF Portfolio. While they both have the same equity/bond allocations at 60/40, there are several differences between the 2 funds.
VBAL has a management fee of 0.22% compared to 0.65% from Tangerine. There are also differences in the geographical allocation between the 2 funds. For example, VBAL’s bond allocation is globally diversified but Tangerine has only Canadian bonds. Also, VBAL’s Canadian equity has some home bias with about 17% allocation compared to less than 2% for Tangerine Balanced ETF Portfolio.
It is difficult to say how the different allocations will impact future performances though.
You may also want to check the new Vanguard Retirement Income ETF Portfolio (VRIF).
Simon, your review is so informative and thorough, I love the charts! I have subscribed to your Newsletter.
I have been with Tangerine for 18 years. I currently get 1.4 % interest on my Savings which represent 34 % of my liquid assets, but I have to renegotiate the rate every few months.
Being a 75 years old women in good health, with a tolerance to risk being low to medium, I could have a good 5 to 7 years ahead of me. I wonder if this term is too short to invest in either :
Tangerine Balanced Income Core Portfolio : 40% Stocks/60% Bonds – 5 years 4.7% return
Tangerine Balanced Core Portfolio: 60% Stocks/40% Bonds – 5 years 7.42% return