Wealthsimple Invest

You sure can! Here at Wealthsimple, we bring it back to the fundamentals. Let's break down our approach:

1. Diversification: Each of our portfolios is fully diversified across asset classes to help investors achieve a higher rate of return while taking less risk. To do this, we build our portfolios through the purchase of broad based Exchange Traded Funds(ETFs). So not only are you diversified within an asset, you are also diversified across assets.

2. Don't pick stocks: "Smart" people spend a lot of time cooking up foolproof strategies to deliver above average market returns. However, the vast majority of these strategies fail to beat the market. Over the past 100 years, the markets have survived depressions, world wars, tech bubbles, and real estate collapses. Guess what strategy most investors would have been best off going with? You guessed it - the boring old passive strategy of buy and hold.

3. It's about you and your goals: We build you a personalized portfolio designed to meet your financial goals.. When you join Wealthsimple, you tell us a little about your investment experience, financial circumstances and what you're saving for, so we can customize your portfolio.

Simple, right? But if you still have questions, we're here to help. Please send us an email or give us a call.

No. We don't charge anything for withdrawals, transferring out, or leaving your account open with a zero balance.

When you invest with Wealthsimple, your assets are actually held by Canadian ShareOwner Investments Inc. (ShareOwner), Wealthsimple's custodial broker. In other words, ShareOwner executes trades and holds your cash and securities. ShareOwner is regulated by IIROC and is a member of the Canadian Investor Protection Fund (CIPF), which is standard for brokerages in Canada. Therefore, your investment accounts (which excludes your Smart Saving) at Wealthsimple are protected by CIPF.

CIPF protects our the securities in our customers' investment accounts up to a total of $1 million per account against insolvency or bankruptcy. More on the CIPF here.

In the extremely unlikely event that Wealthsimple were to go out of business, your account would remain safe and be largely unaffected. All securities are registered in your name, and if we were to close, you could choose to keep your money with ShareOwner, or transfer it to a new advisor or your bank account.

Expected returns are impossible to predict and out of your (and our) control. We prefer to focus on things we can control: fees, diversification and emotions. The stock market will take care of returns over the long term. The key is to stay disciplined and stick to your strategy in order to build wealth. You can read more about our investment strategy here.

First, let's start with the basics: a return is the amount of money earned or lost on an investment. Annual returns are usually shown as a percentage on your statements. Let’s say you start the year with $100, and at the end you have $110; that would mean you have a 10% return on your money.

At Wealthsimple, we calculate your progress in three ways: simple return, time-weighted return, and money-weighted return. For the last number of years, it has been standard for Canadian investment professionals to show their returns as time-weighted. But as of January 2017, all investment firms must begin showing their returns as money-weighted (we already showed you both, so no changes here).

Simple (naive) return A simple return is a basic calculation of your net earnings divided by your net deposits. It is the easiest calculation to understand, but may not correctly reflect what has actually gone on in your account over time. This calculation takes all of your deposits and assumes they were added to your account on the first day the account was funded. Also, in a case where you've earned positive returns, and then withdrawn more money than you deposited, a simple return won't accurately reflect what's going on.

Time-weighted return Time-weighted returns are simply the performance of an account over a certain period of time. So if you started the year with $100 in your account, you didn’t touch it, and at the end of the year had $110, that would be a 10% time-weighted return. The thing is, if you make deposits and withdrawals over the year (as most of us do), a time-weighted return won't take that into account. So while it's useful for comparing the performance of different investments or money managers, it won't help you understand how much money you actually made or lost. This return is also affected by foreign currency exchange rates as well as management fees.

Money-weighted return Money-weighted returns take into account any deposits and withdrawals you make and reflect the actual money you made or lost over the year. If you make a large deposit and the market goes up, it will influence your money-weighted return upwards (and vice-versa). Same as time-weighted returns, this return is also affected by foreign currency exchange rates as well as management fees.

You can read more about the difference between time-weighted and money-weighted returns here.

Investor type: Our Growth portfolios range from 75-90% equity and are designed for an individual with medium-to-high risk tolerance. If you can bear market fluctuations with relative ease and understand that there can be short-term periods of poor performance, this portfolio is for you.

Performance: We've modeled an 80% equity portfolio below. This portfolio has grown by 24.1% (net of fees) since Wealthsimple's launch on August 20, 2014, to January 31, 2019.

Breakdown: To view a full breakdown of the funds your portfolio will be invested in, click here.

Investor type: Our balanced portfolios are suitable for an investor with low-to-medium risk tolerance. If you are relatively cautious with your capital but are willing to seek a return commensurate with reasonable risk, this portfolio is for you.

Performance: We've modelled a 50% equity portfolio below. The portfolio has grown by 16.7% (net of fees) since Wealthsimple's launch on August 20, 2014 to January 31, 2019.

Breakdown: To view a full breakdown of the funds your portfolio will be invested in, click here.

Investor type: Our Conservative portfolios have around 30% equity allocation. These have been designed for a conservative investor desiring a slightly larger equity component. If you prefer stability and a modest return, this portfolio is for you. You should be willing to accept that there are short-term market fluctuations but also hold a long-term perspective.

Performance: We've modelled a 35% equity portfolio below. This portfolio has grown by 12.5% (net of fees) since Wealthsimple's launch on August 20, 2014 to January 31, 2019.

Breakdown: To view a full breakdown of the funds your portfolio will be invested in, click here.

Some of our underlying ETFs may have periodic exposure to cannabis and marijuana stocks, however none of our ETFs are specific to the cannabis sector. By investing in a diversified portfolio, you will be exposed to various different sectors and geographies, which can include marijuana.

Currently, cannabis stocks (Canopy, Aphria, Aurora, etc.) are included in XIC.