Tag: norbert’s gambit

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Retirement Portfolio is now USD-free

RobHLeave a comment

On September 4th, I sold my last units of DLR1 within my RRIF account and completed my multi-month activity of kicking USD out of retirement portfolio. I ended up doing this about 3 months faster than I anticipated, but that’s because Questrade offered a free two-month trial for Questrade Plus, which included as many free journaling activities2 as you wished during the trial. And since I’m a cheapskate, I figured saving the journaling fees was worth me upping the pace of my USD to CAD conversions.

I asked Claude to take a look at the various gambits I undertook3 and evaluate them. Claude was quite upbeat:

  • Claude calculated an effective blended rate of 1.39946.
  • Claude said I beat the spot rate by roughly +0.15% overall
  • And, as expected, Claude assessed that every single gambit landed within a few basis points of the spot market, much better than what Questrade would have charged me (1.5% or so).

So now, here’s what my various account types look like, in terms of assets. There’s no USD listed ETFs anymore. Here’s what the three kinds of accounts look like.

Let’s recap the major changes, per account type.

Non-Registered accounts

I’m always a bit reluctant to mess around with non-registered accounts since making trades here inevitably lead to capital gains. But the impact in the end was pretty minor.

There’s actually three separate accounts being considered here. Two are legacy investment accounts that have long-term holdings. The other is my so-called “cash cushion” account that is an integral part of my decumulation strategy, called “VPW”. You can read about the mechanics of it here.

So for the cash cushion, I had to get rid of ICSH in favour of ZMMK. I’m giving up roughly 1.2% in annual return by doing this, but I figure at some point the Bank of Canada and the US Federal Reserve will get closer in terms of their interest rates. This had a minor capital gain impact, which was as expected. Both ICSH and ZMMK keep a pretty stable price point (around $50/unit) and pay out monthly.

The bigger issue was getting rid of SCHF from my non-registered holdings, which I had held for a very long time. Selling that was going to trigger a large capital gain that I hadn’t accounted for in my tax calculations. The solution I came up with was pretty nifty, if I do say so myself. SCHF in my model is largely “International Equity” so clearly I was going to have to replace that international equity contribution somewhere. I ended up replacing SCHF with VCN (a Canadian equity holding) and replacing XIC (a slightly different Canadian equity holding than VCN) with VFV in the TFSA account. In essence, I moved my international equity stake out of my non-registered accounts and put it in the TFSA instead.

By buying VCN (a new fund for me) in my non-registered account, I reset the ACB of that fund so selling units a few months from now shouldn’t really attract too much in the way of capital gains. In fact, the first month4 I sold VCN to pay my monthly salary, I took a small loss. So my tax planning should also stay intact.

TFSA accounts

There were no USD assets in my TFSA to begin with, so no changes were needed on that account. I had to do some asset class shifting here while maintaining 100% equity allocation in the TFSA. As mentioned above, XIC (Canadian Equity) was dismissed from the TFSA, and replaced with VIU (which is international equity).

I do have a small desire to covert the TFSA into a custom index (a Questrade feature) to save a bit on the MER imposed by XEQT here. I may yet do this. It will expand the number of ETFs in these accounts since I’ll need to decompose XEQT into its constituent components. This is again a case of me adding complexity in order to save a few bucks…But don’t I owe it to my readership to give it a try?

RRIF accounts

Mainly, the RRIF accounts replaced AOA with XGRO and ICSH with ZST. But since XGRO holds a lot less US Equity than AOA did, the AOA to XGRO conversion wasn’t exact. I had to replace some of the AOA with a US Equity holding (VFV). I chose to use ZST instead of ZMMK in the RRIF for two reasons:

  • I wanted a different ETF in my RRIF as compared to my non-registered. This helps me avoid CRA superficial loss rules.
  • ZST is ever so slightly riskier than ZMMK, which is fine, since the cash position in the RRIF is much more static than the cash position in my non-registered account.

The way ahead

Getting rid of USD assets has simplified my portfolio and my workflow thinking. I no longer have to worry about USD/CAD exchange rates, and my need to use Norbert’s Gambit should be over. It also opens up my universe to other DIY brokers. I’ve been a fan of Wealthsimple, but couldn’t use them for my RRIF accounts since they contained USD assets. Now I can consider Wealthsimple for all my investing needs5.

Working through the mechanics of slowly moving my assets to an all CAD lineup has caused me to probably spend way more time than is healthy looking at my portfolio and making trades. This should come to an end — with DRIP set up across all registered accounts6, the holdings should be more or less on autopilot with only monthly checkins to make sure my asset allocations haven’t drifted too far from my targets.

I’ve updated my posts that talk about ETF all stars and the “Magnificent Seven” ETFs as well, for reference.

  1. Selling DLR is the last step of a Norbert’s Gambit when you’re converting USD to CAD. You can read about the gambit on Questrade here. ↩︎
  2. “Journaling” is the step that turns units of DLR.u (which are priced in USD) into units of DLR (which are priced in CAD). If you’re not a Questrade Plus subscriber, journaling costs $9.95 plus HST every time you do it on Questrade. ↩︎
  3. Ok, not all of them — Claude only connects to the accounts I own, and not those of my spouse. And the last trades haven’t settled yet, so the one I did on September 4th wasn’t showing up in my transaction history. I don’t expect the story is too different if I include the gambits I ran in my spouse’s RRIF account. ↩︎
  4. After making sure 30 days had passed in order to avoid a “superficial loss” in CRA’s parlance. ↩︎
  5. And if they offer a promotional offer that throws free money my way, I’d seriously consider switching brokers again. ↩︎
  6. I don’t use DRIP in non-registered accounts because non-registered transactions need to be logged for adjusted cost base adjustments; I’d prefer to keep these fully under my control to minimize the number of transactions. I don’t mind carrying a bit of cash in non-registered accounts in order to avoid excess trades. ↩︎

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What’s in my retirement portfolio (August 2026)?

RobHLeave a comment

This is a monthly look at what’s in my retirement portfolio. The original post is here.

Portfolio Construction

The retirement portfolio is spread across a bunch of accounts:

  • 5 RRIF accounts
    • 3 for me (Questrade, Wealthsimple)
    • 2 for my spouse (Questrade)
  • 2 TFSA accounts (Questrade)
  • 4 non-registered accounts, (1 for me, 1 for my spouse, 2 joint, all at Questrade)

The view post-payday

I pay myself monthly in retirement, and the charts that follow reflect the view post-payday, which happens around the end of the month1. On August 27th before the markets opened, this is what it looked like:

The portfolio is dominated by my ETF all-stars, (and if not an all-star, they are probably on the Magnificent Seven ETFs list).

More progress has been made on my plan to kick USD out of my retirement portfolio; it’s proceeding faster than I originally planned thanks to Questrade’s offer of free Norbert’s Gambit to all Questrade users for a few months. I’m expecting that it’ll all be gone by the end of September.

AOA is largely being replaced by XGRO, but because AOA is so heavily US Equity weighted, I always have to pick up VFV to make up the difference — I’m kicking USD out of my portfolio, not the US market. ZST is my pick for the RRIF to replace ICSH. It’s a similar idea to ICSH, but since Canadian interest rates are lower, I expect I’m sacrificing a bit of return there. I hope this will work itself out in the long run.

And I’m trying to respect my asset allocations at the same time, which remain unchanged:

  • 5% cash/ultra short term bonds
  • 15% bonds
  • 23% Canadian Equity
  • 37% US Equity
  • 20% International Equity

The asset-class split looks like this; you can read about my asset-allocation approach to investing over here. Every time I get rid of some AOA or ICSH, it gives me an opportunity to make sure I respect the splits. Here’s what it looks like:

Plan for the next month

With the asset class splits under control, next month will see the last vestiges of USD gone from the portfolio. And I expect I’ll do a bit of shifting to bump up the Interational Equity portion of the portfolio, which is a little light. And I plan to celebrate a bit, because the removal of USD from my retirement portfolio should reduce complexity significantly.

Overall

Part of using VPW2 as a strategy is the need to calculate your retirement net worth on a monthly basis. Net worth clawed its way back to June’s levels, but no complaints — it’s still 20% above where it was when I started on my retirement journey 20 months ago.

My VPW-calculated salary has now increased for 8 straight months, it’s nice getting a monthly raise!

  1. The exact day is variable because of the timing of the end of the month. Payday has to fall on a trading day. ↩︎
  2. Variable Percentage Withdrawal, a structured way to decumulate your portfolio. ↩︎
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What’s in my retirement portfolio (July 2026)?

RobHLeave a comment

This is a monthly look at what’s in my retirement portfolio. The original post is here.

Portfolio Construction

The retirement portfolio is spread across a bunch of accounts:

  • 5 RRIF accounts
    • 3 for me (Questrade, Wealthsimple)
    • 2 for my spouse (Questrade)
  • 2 TFSA accounts (Questrade)
  • 4 non-registered accounts, (1 for me, 1 for my spouse, 2 joint, all at Questrade)

The view post-payday

I pay myself monthly in retirement, so that’s a good trigger to update this post. On July 301 before the markets opened, this is what it looked like:

The portfolio is dominated by my ETF all-stars, (and if not an all-star, they are probably on the Magnificent Seven ETFs list).

There have been pretty big changes since last month as my strategy to Kick USD out of my retirement portfolio continues in earnest. This has focused on getting rid of AOA and ICSH in my spouse’s RRIF account this month as she takes advantage of the free Norbert’s Gambit included in her trial subscription to Questrade Plus2.

AOA is largely being replaced by XGRO, but because AOA is so heavily US Equity weighted, I always have to pick up VFV to make up the difference — I’m kicking USD out of my portfolio, not the US market. ZST is my pick for the RRIF to replace ICSH. It’s a similar idea to ICSH, but since Canadian interest rates are lower, I expect I’m sacrificing a bit of return there. I hope this will work itself out in the long run.

And I’m trying to respect my asset allocations at the same time.

Plan for the next month

The asset-class split looks like this; you can read about my asset-allocation approach to investing over here.

The moves I made to start reducing USD in my portfolio have quickly allowed me to get to my recently revised target allocations I have for each asset class:

  • 5% cash or cash-like holdings like ZMMK and ZST
  • 15% bonds/income (most are buried in XGRO and AOA, rest are in XCB)
  • 23% Canadian equity (mostly based on ETFs that mirror the S&P/TSX — HXT and XIC); this is up from the old 20% target
  • 37% US equity (dominated by ETFs that mirror the S&P 500); this is up 1% from the old target
  • 20% International equity (mostly, but not exclusively, developed markets); this is down 4% from the old target

With the asset class splits under control, next month will see more moves to get rid of USD in my portfolio. There’s only USD in my RRIF accounts now, all invested in AOA and ICSH. These positions will be reduced by 1/5th in August as my target is to be fully USD free by the end of the year.

My timing for conversion looks to have been pretty decent; the USD/CAD rate continues to run north of 1.40, which for me is a good thing.

Overall

Part of using VPW3 as a strategy is the need to calculate your retirement net worth on a monthly basis. My three month winning streak has come to an end as I took a slight step back month over month. However, I’m worth 19% more than when I started my retirement journey in January 2025.

Irrespective of my net worth stumble, my VPW-calculated salary continues to increase, albeit at a more modest rate, as expected. The VPW cash cushion (now 100% invested in ZMMK) acts like a shock absorber to my salary, smoothing out the more volatile month to month variations in my net worth.

  1. I did all the trading I needed to do on the 24th; it takes a few days for everything to settle and for money to get sent to the bank account. My net worth is quite a bit lower after the mini-crash on the 29th! ↩︎
  2. Questrade Plus is 11.95 monthly, but offers a 30 day free trial. I’m a cheapskate, remember? Norbert’s Gambit is otherwise 9.95 a go plus HST. ↩︎
  3. Variable Percentage Withdrawal, my chosen decumulation strategy. ↩︎
variety of cookies in a box

What’s in my retirement portfolio (June 2026)?

RobH1 Comment

This is a monthly look at what’s in my retirement portfolio. The original post is here.

Portfolio Construction

The retirement portfolio is spread across a bunch of accounts:

  • 5 RRIF accounts
    • 3 for me (Questrade, Wealthsimple)
    • 2 for my spouse (Questrade)
  • 2 TFSA accounts (Questrade)
  • 4 non-registered accounts, (1 for me, 1 for my spouse, 2 joint, all at Questrade)

The view post-payday

I pay myself monthly in retirement, so that’s a good trigger to update this post. On June 30 before the markets opened, this is what it looked like:

The portfolio is dominated by my ETF all-stars, (and if not an all-star, they are probably on the Magnificent Seven ETFs list). But the observant reader will start to see some changes from last month as my strategy to Kick USD out of my retirement portfolio starts to take effect. The contributions of AOA and ICSH (both USD funds) to my retirement portfolio are notably down and SCHF has disappeared entirely — SCHF was the last bit of USD in my non-registered accounts. ZMMK, XGRO and VCN, on the other hand, have gained in importance to make up for the USD-denominated departures. And ZST (ultra short-term bond fund) and VFV (S&P 500 US Index fund) have begun to make an appearance; you’ll see more of these funds in future months. My ETF all-stars post has been updated accordingly.

Plan for the next month

The asset-class split looks like this; you can read about my asset-allocation approach to investing over here.

The moves I made to start reducing USD in my portfolio have quickly allowed me to get to my recently revised target allocations I have for each asset class:

  • 5% cash or cash-like holdings like ICSH and ZMMK
  • 15% bonds/income (most are buried in XGRO and AOA, rest are in XCB)
  • 23% Canadian equity (mostly based on ETFs that mirror the S&P/TSX — HXT and XIC); this is up from the old 20% target
  • 37% US equity (dominated by ETFs that mirror the S&P 500); this is up 1% from the old target
  • 20% International equity (mostly, but not exclusively, developed markets); this is down 4% from the old target

With the asset class splits under control, next month will see more moves to get rid of USD in my portfolio. There’s only USD in my RRIF accounts now, all invested in AOA and ICSH. These positions will be reduced by 1/6th in July as my target is to be fully USD free by the end of the year.

My timing for starting the conversion looks to have been pretty decent; the USD/CAD rate moved significantly in my favour this month. I don’t expect that to last!

Overall

Part of using VPW1 as a strategy is the need to calculate your retirement net worth on a monthly basis. And once again, a new all-time high:

My VPW-calculated salary continues to increase, albeit at a more modest rate, as expected.

  1. Variable Percentage Withdrawal, my chosen decumulation strategy. ↩︎
dollar cut in half

Kicking USD out of my retirement portfolio

RobH1 Comment

After much consideration, I’ve decided that holding USD-denominated assets during retirement is no longer a good idea. I have been struggling with this question for a while now.

There are a few reasons why I’ve reached this conclusion:

  • I no longer spend USD. I have two credit cards1 that allow me to avoid foreign exchange fees.
  • Complexity. The USD in my RRIF accounts needs to be converted periodically since withdrawals are in CAD. The USD in my non-registered account might eventually lead me to have to file a T1135, and I hate new tax wrinkles. And of course the USD funds add to the universe of funds I have to manage in all the accounts. Fewer is better!
  • Choice. Without USD in my portfolio, the universe of DIY brokers opens up2 and the number of accounts I have to have is also reduced34.

The fluctuating CAD/USD FX rate might be another reason, but that hasn’t really bothered me. In the long term, it’s reasonably stable.

So how to go about doing it, and what impacts will this have? Let’s take a look.

General considerations

So of course, the only real way to convert USD into CAD at Questrade is to use Norbert’s Gambit. Performing the Gambit is a multi-day activity:

  • Day 1: Sell the USD asset and buy DLR.U with the proceeds; make journaling request to convert DLR.U into DLR
  • Day 2: Wait for settlement of trades made on day 1
  • Day 3: Wait for journaling to complete
  • Day 4: Wait for journaling to complete
  • Day 5: Sell DLR and buy CAD-listed assets to replace what I sold on day 1

Each time I do this exercise, it makes me a little leery since

  • I have to pay $9.95 plus GST to journal the shares on Questrade (not a huge deal, but as you have read elsewhere on the blog, I am a cheapskate)
  • I’m out of the market for 3 days. I really hate being out of the market since big moves can happen over short periods of time. Of course, this cuts both ways; I could miss a big rally or a big meltdown as a result5.
  • I’m making a bet on favourable FX rates. FX rates don’t typically swing much in short periods of time, but since over 50% of my retirement portfolio is in USD I’m not willing to try to find the “right” time to make such a trade.

As a result, I’ve made the decision to

  • Sell off 1/6th of my USD portfolio every month for the next six months (or thereabouts). This will allow me to smooth out any FX speed bumps and limits how much of my portfolio is idle at any one time.
  • Take advantage of a free month of Questrade Plus6 and do a few journaling requests during this month and save a few bucks

While doing all of this, I’m trying to be mindful of my asset allocation targets which are (newly set as a result of my analysis at Are my portfolio’s asset allocation targets “correct”?)

  • 5% Cash
  • 15% Bonds
  • 23% Canadian Equity
  • 37% US Equity
  • 20% International Equity

I’ll try to start moving my portfolio to these new targets as I make this shift, but given the targets are brand new, I’m in no particular time constraints; I’m expecting the portfolio to slowly move from the old targets to the new ones, finally landing at some point later in 2026.

Kicking USD out of my RRIF accounts

Of the 5 RRIF accounts I have in the household (three for me, two for my spouse), only two of them have USD in it, and the USD portion is 100% invested in either AOA (an 80/20 all-in-one global equity fund) or ICSH (an ultra short-term bond fund that stands in for cash)

AOA can be replaced with XGRO but it’s not an exact replacement. AOA has almost no Canadian Equity content and a higher US Equity content than XGRO. This means that a one-to-one switch will cause my Canadian Equity content to increase and my US content to decrease. I’m expecting this will eventually cause me to need to replace some of my AOA with a pure play US Equity asset. I’ve chosen VFV since it mirrors the S&P 500, an index that won’t be adding the mega-IPOs any time soon 🙂

ICSH can be replaced with ZMMK since they are similar in nature, but I’m not going to do that. Why? Because I hold ZMMK in my non-registered account as a VPW cash cushion, I do make trades in ZMMK from time to time. I don’t want to end up in a situation where I’m selling ZMMK in my non registered account and buying it in my RRIF, since this could deprive me of possible (small) capital losses — CRA does not look kindly on trying to “artificially” generate capital losses in this way.

So after mulling it over a bit, I’ve decided to replace ICSH in my RRIF accounts with ZST. It’s a short term bond fund which is a bit riskier than ZMMK7, but I’m counting on it being cash-like for my purposes. Neither has been around all that long, but it appears they are pretty close on the performance front with a slight edge for ZST.

So when all is said and done, my RRIFs should have three holdings: XGRO (mostly), VFV (some), ZST (about 2.5% of overall portfolio),

Kicking USD out of my non-registered accounts

Here there are two holdings

  • ICSH in my VPW cash cushion account
  • SCHF, an international equity fund I’ve held for years and years

The ICSH replacement is easy — move it to ZMMK. I’ll do that all at once. It will mean a loss of over a percentage point in gains at the moment, but this is the price of simplicity, I guess.

The SCHF sale is a bit like selling 6 months of RRIF payments all at once, which will attract a capital gain. I’m ok with that, but I’d prefer to avoid more capital gains for the rest of the year (I didn’t budget for that when I tried to work out my likely tax bill for 2026). Since selling SCHF is actually helpful in getting my new asset allocation targets right, I don’t need to replace it with another International Equity fund. My calculations tell me that I’ll probably need to replace it with a Canadian Equity fund. Here I’ve chosen to use VCN since it uses a different index provider8 and would be considered different from my other non-registered Canadian equity funds, namely XIC and HXT9. Buying VCN and selling it in subsequent months to fund my retirement salary should result in minimal capital gains for the remainder of the year.

So when all is said and done, the VPW cash cushion account should be 100% ZMMK and the other non registered account will be 100% CAD-listed ETFs, mostly tied up in Canadian Equity.

You’ll be able to see my progress in my next instalment of What’s in my retirement portfolio (May 2026) which I should have ready at the end of this month!

  1. Rogers Mastercard and Wealthsimple Visa, as detailed in What are the best credit cards? ↩︎
  2. e.g. Wealthsimple does not currently (June 2026) support USD RRIF accounts. ↩︎
  3. e.g. QTrade USD accounts are always separated from CAD accounts. So instead of 4 RRIF accounts, I could have 8 at QTrade. Painful. ↩︎
  4. I guess that’s actually a “reduce complexity” argument. Don’t tell anybody. ↩︎
  5. https://www.bogleheads.org/forum/viewtopic.php?t=370885 shows me that my fears are unfounded. It’s practically a normal distribution. ↩︎
  6. A subscription service offered by Questrade to give you free journaling. And other things I don’t really care about. ↩︎
  7. Average duration is longer, which makes its price more sensitive to changes in the overall interest rate environment. ↩︎
  8. FTSE Canada all cap rather than S&P/TSX for the others ↩︎
  9. And therefore avoids CRA’s superficial loss rules ↩︎