When is a Good Time to Buy XEQT? The Answer Might Surprise You

One of the most common questions I get from Canadian investors is: “When is a good time to buy XEQT?”

The truth is, trying to time the market is one of the biggest mistakes investors make. Instead of waiting for the “perfect” moment, the best strategy is often to start investing now and use dollar-cost averaging to build wealth over time.

In this post, we’ll explore why the best time to buy XEQT is often right now, regardless of market conditions, and how dollar-cost averaging can help you build wealth even when markets are hitting all-time highs.

The Market Timing Trap

Many investors fall into the trap of trying to time the market perfectly. They wait for:

• A market crash
• Lower prices
• “Better” economic conditions
• The “right” moment

But here’s the reality: nobody can consistently predict market movements. Even professional fund managers struggle to beat the market through timing.

Why Market Timing Usually Fails:

• Emotional Decision Making: Fear and greed drive poor timing decisions
• Missing Out on Gains: While waiting for a dip, you miss out on potential returns
• Opportunity Cost: Cash sitting idle loses purchasing power to inflation
• Stress and Anxiety: Constantly worrying about market conditions

The data shows that time in the market beats timing the market almost every time.

Why “Now” is Usually the Best Time to Buy XEQT

1. Markets Trend Upward Over Time

Despite short-term volatility, global stock markets have historically trended upward over long periods. XEQT, with its global diversification, captures this long-term growth.

Historical Context:

• Markets hit “all-time highs” regularly
• Each new high eventually becomes a low point
• Long-term investors benefit from this upward trend

2. Dollar-Cost Averaging Works in All Market Conditions

Dollar-cost averaging (DCA) is your secret weapon. By investing regularly regardless of market conditions, you:

• Buy more shares when prices are low
• Buy fewer shares when prices are high
• Average out your cost basis over time
• Remove emotion from investing decisions

3. Compound Growth Starts Immediately

Every day you delay investing is a day of lost compound growth. Even small amounts invested regularly can grow significantly over time due to compounding.

Example: Investing $100/month in XEQT for 30 years at 7% annual returns grows to over $120,000.

Dollar-Cost Averaging: Your Market-Timing Antidote

Dollar-cost averaging is the practice of investing a fixed amount of money at regular intervals, regardless of market conditions. It’s perfect for XEQT investors.

How DCA Works with XEQT:

Month 1: XEQT = $25/share → $100 buys 4 shares
Month 2: XEQT = $30/share → $100 buys 3.33 shares
Month 3: XEQT = $22/share → $100 buys 4.55 shares
Month 4: XEQT = $28/share → $100 buys 3.57 shares

Average cost: $25.25/share (vs. trying to time individual purchases)

Benefits of DCA with XEQT:

✅ Reduces emotional investing
✅ Smooths out market volatility
✅ Builds discipline and consistency
✅ Works in both bull and bear markets
✅ Perfect for beginners

Why Markets at All-Time Highs Aren’t a Problem

Many investors worry about buying when markets are at all-time highs. But this concern is often misplaced.

Historical Perspective:

• Markets hit new highs frequently: The S&P 500 has hit new highs in about 30% of all trading days
• New highs lead to higher highs: Markets that reach new highs often continue climbing
• Time horizon matters: For long-term investors, short-term peaks become insignificant

XEQT’s Advantage:

XEQT’s global diversification helps protect against regional market peaks:

• Canadian markets might be high while international markets are lower
• US markets might peak while emerging markets offer opportunities
• Different sectors perform at different times

The Psychology of Investing: Overcoming Fear

Common Fears About Buying XEQT:

“What if I buy at the top?”

• Markets have recovered from every previous “top”
• Long-term investors benefit from market growth
• DCA reduces the impact of buying at peaks

“What if there’s a crash?”

• Crashes are temporary; recoveries are permanent
• DCA allows you to buy more during dips
• XEQT’s diversification provides some protection

“What if I lose money?”

• Short-term volatility is normal
• Focus on long-term wealth building
• Historical data supports equity investing

The Solution: Start Small and Stay Consistent

• Begin with small amounts you’re comfortable with
• Set up automatic investing to remove emotion
• Focus on the long term (5+ years minimum)
• Educate yourself about market cycles

Practical Steps to Start Investing in XEQT

Step 1: Choose Your Platform

Wealthsimple Trade offers:

• Zero commission trading
• Fractional shares (invest any amount)
• Automatic investing features
• Tax-advantaged accounts (TFSA, RRSP)

Step 2: Set Up Your Account

• TFSA: For tax-free growth (if you have contribution room)
• RRSP: For retirement savings and tax deductions
• Non-registered: For additional investing beyond registered accounts

Step 3: Start Your DCA Strategy

• Choose your frequency: Weekly, bi-weekly, or monthly
• Set your amount: Start with what you can afford consistently
• Automate it: Set up automatic transfers and purchases
• Stay consistent: Don’t stop during market downturns

Step 4: Monitor and Adjust

• Review quarterly: Check your progress and adjust if needed
• Increase contributions: As your income grows, increase your investments
• Stay the course: Resist the urge to time the market

Common Scenarios: When to Buy XEQT

Scenario 1: “I’m waiting for a market crash”

Reality: Market crashes are unpredictable and rare. You might wait years and miss significant gains.

Better approach: Start investing now with DCA. If a crash happens, you’ll be buying more shares at lower prices.

Scenario 2: “Markets are too expensive right now”

Reality: Markets often look expensive in hindsight, but they continue growing.

Better approach: Focus on your long-term goals. XEQT’s diversification helps manage valuation concerns.

Scenario 3: “I’ll wait until I have more money”

Reality: Starting small is better than not starting at all.

Better approach: Begin with what you can afford and increase over time.

Scenario 4: “I need to research more first”

Reality: Analysis paralysis prevents wealth building.

Better approach: Start with a small amount while continuing to learn.

The Power of Starting Early

The Magic of Compound Growth:

Starting at 25 vs. 35:

• Investing $200/month for 40 years (starting at 25): ~$700,000
• Investing $200/month for 30 years (starting at 35): ~$300,000

The difference: Starting 10 years earlier nearly doubles your final wealth!

Why XEQT is Perfect for Long-Term Growth:

• Low fees (0.20% MER) maximize your returns
• Global diversification reduces risk
• Automatic rebalancing maintains optimal allocation
• Tax efficiency in registered accounts

Building Your XEQT Investment Strategy

Beginner Strategy (0-2 years investing):

• Start with $50-100/month
• Use TFSA if you have room
• Focus on consistency over amount
• Learn about market cycles

Intermediate Strategy (2-5 years investing):

• Increase contributions as income grows
• Consider RRSP for tax benefits
• Add non-registered account if needed
• Review and rebalance annually

Advanced Strategy (5+ years investing):

• Maximize registered accounts
• Consider tax-loss harvesting
• Evaluate other investment options
• Plan for major life events

Common Mistakes to Avoid

❌ Mistake 1: Trying to Time the Market

Solution: Use dollar-cost averaging instead

❌ Mistake 2: Stopping During Market Dips

Solution: Remember that dips are buying opportunities

❌ Mistake 3: Investing Money You Need Soon

Solution: Only invest money you won’t need for 5+ years

❌ Mistake 4: Checking Your Portfolio Daily

Solution: Review quarterly or annually

❌ Mistake 5: Comparing to Others

Solution: Focus on your own financial goals

The Bottom Line: Start Today

The best time to buy XEQT is when you’re ready to commit to long-term investing. Here’s why:

✅ Markets trend upward over time
✅ Dollar-cost averaging works in all conditions
✅ Compound growth starts immediately
✅ XEQT’s diversification reduces timing risk
✅ Consistency beats perfection

Your Action Plan:

1. Open a Wealthsimple Trade account (get $25 free)
2. Set up automatic investing for XEQT
3. Start with what you can afford consistently
4. Increase contributions as your income grows
5. Stay the course for long-term wealth building

Ready to Start Your XEQT Journey?

Remember: The best time to plant a tree was 20 years ago. The second best time is now.

The same applies to investing in XEQT. Don’t let market timing fears prevent you from building wealth. Start today, stay consistent, and let time and compound growth work in your favor.

The market will always have reasons to wait. But your future self will thank you for starting today.

Related Reading

• How Much Should You Invest in XEQT Monthly?
• How Does XEQT Perform During Recessions?
• XEQT for Beginners
• 7 Investing Mistakes XEQT Helped Me Stop Making
• Get started with Wealthsimple and earn a $25 bonus

Disclosure: This post contains referral links. I may receive compensation if you sign up through these links, but this doesn’t affect my honest assessment. I genuinely believe XEQT is an excellent choice for Canadian investors seeking long-term wealth building.