One of the simplest moves is to add some fixed income to a portfolio. The easy choice in Canada is the largest fixed income ETF, iShares DEX Universe Bond Index Fund (TSX:XBB).
This ETF has more than $2.2 billion in total assets, spread out among 1,127 different holdings, including federal, provincial, and high-quality corporate bonds. The management fee is a reasonable 0.3% and the trailing 12-month yield is 2.74%.
Another choice is REITs, which have traditionally been a solid choice to buy during market turbulence as investors move into solid dividend-paying names. The iShares S&P/TSX Capped
REIT Index ETF (TSX:XRE) is a decent choice, owning 16 of Canada’s largest REITs in a fund with an expense ratio of 0.61%.
This ETF pays a monthly dividend of 6.68 cents per share each month, good enough for a 5% yield.
And finally, consumer staples have been a good place to hide out when the rest of the market is experiencing volatility. First Trust Alpha DEX U.S. Consumer Staples Sector Index ETF
(TSX:FHC) is a relatively new ETF that tracks the sector in the United States.
The ETF has approximately 40 holdings, which are concentrated in the processed food, tobacco, and grocery industries. It’s a tiny fund with only $6.3 million in total assets-- and average volume of just 4,000 shares per day to boot-- but it does pay a reasonable 2% dividend.
