VOO🇺🇸 US
Vanguard S&P 500 ETF
What it tracks: The 500 largest publicly traded US companies (S&P 500 index).
Expense ratio
0.03%
New to investing? Start here.
Investing doesn't have to be complicated.
Three short sections to give you a working foundation: what a balanced portfolio looks like, what ETFs are and why they make diversifying easy, and how much your money can grow when you leave it alone.
1 · Portfolio basics
A balanced portfolio spreads risk three ways
Diversification is the closest thing to a free lunch in investing. Each dimension below reduces the damage any single event can do.
Geography
Markets in different countries don't move in lockstep. When one region is down, another is often up.
United States55%
Canada10%
Europe20%
Emerging15%
Asset type
Equities grow long-term but swing a lot. Bonds pay steady income and move less — they cushion portfolios when stocks fall.
Equities70%
Bonds (less volatile)30%
Industry
Different industries rise and fall at different times. Spreading across sectors dampens the impact when one gets hit.
Tech30%
Healthcare20%
Financials18%
Consumer18%
Energy14%
A balanced portfolio spreads risk across all three.
2 · ETFs
ETFs: instant diversification in one ticker
What's an ETF?
An ETF (exchange-traded fund) is a basket of many stocks or bonds bundled into a single ticker. Buying one share gets you instant exposure to everything inside, the easiest way to build a diversified portfolio without picking individual stocks.
Eight ETFs worth knowing
Broad Market
VTI🇺🇸 US
Vanguard Total Stock Market ETF
What it tracks: Virtually every publicly traded US stock — large, mid, and small cap.
Expense ratio
0.03%
VXUS🇺🇸 US
Vanguard Total International Stock ETF
What it tracks: Stocks from developed and emerging markets outside the US.
Expense ratio
0.07%
BND🇺🇸 US
Vanguard Total Bond Market ETF
What it tracks: Broad US investment-grade bond market (government, corporate, and mortgage-backed).
Expense ratio
0.03%
XIC🇨🇦 CA
iShares Core S&P/TSX Capped Composite Index ETF
What it tracks: The broad Canadian equity market (S&P/TSX Capped Composite Index).
Expense ratio
0.06%
XAW🇨🇦 CA
iShares Core MSCI All Country World ex Canada Index ETF
What it tracks: Global equities — developed and emerging markets — excluding Canada.
Expense ratio
0.22%
ZAG🇨🇦 CA
BMO Aggregate Bond Index ETF
What it tracks: A broad basket of Canadian investment-grade government and corporate bonds.
Expense ratio
0.09%
VCN🇨🇦 CA
Vanguard FTSE Canada All Cap Index ETF
What it tracks: Canadian stocks across large, mid, and small cap segments.
Expense ratio
0.05%
Equity ETFs vs. bond ETFs
Equity ETFs
Hold hundreds or thousands of stocks. You own a slice of real companies, so you share in their growth. Over long periods equities return more than bonds, but they swing hard — dropping 20–50% in a bad year is normal.
- • Higher long-term expected return (~7–10% per year)
- • Much bigger ups and downs along the way
- • Best when you have many years before you need the money
Bond ETFs
Hold baskets of bonds — loans to governments and companies that pay regular interest. Returns are lower but much steadier, and bonds often hold their ground (or rise) when stocks fall. That's why they're used to cushion a portfolio.
- • Lower long-term expected return (~3–5% per year)
- • Small drawdowns in most years
- • Best when you want stability or income
Over the last 50 years (1975–2025), $100 invested in a broad US equity ETF would have grown to roughly $27,939, while the same $100 in a US aggregate bond ETF would be around $2,287 — but notice how much smoother the bond line is.
50 years of history: equity vs. bond ETFs
Growth of $100 invested in each, 1975–2025. You can see equities ending much higher, but also the sharp drawdowns along the way (2000–2002, 2008, 2022). Bonds grow more slowly but much more steadily.
Approximate historical total returns. Values are rounded and indexed to $100 at the start of 1975.
3 · Compounding
Time is your biggest advantage
Returns earn returns. Try it: plug in a starting amount and see what happens over the years.
Your scenario
Projected value over 20 years
Final value
$56,131
Total contributed
$25,000
Total growth
$31,131
Growth multiple
2.2×
Hypothetical illustration using constant annual returns. Real markets vary year to year.
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