China grabs a bigger share of the indexes + MORE Jun 24th

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Traditional international index funds assign a weight to each country based on the size of its stock market. But in the case of China, that’s a bit misleading. Despite having the world’s second-largest economy, China has a relatively small number of publicly traded companies. Moreover, many of those publicly traded companies have been off-limits to foreign investors. As a result, the Vanguard Total World Stock ETF (VT) allocates just 2.5% to China—considerably less that than the share allotted to much smaller economies such as Canada, Switzerland and France.
This is about to change: during the coming months and years, index investors will be able to access more of China’s vast economy. Vanguard recently announced that its flagship emerging markets ETF, the Vanguard FTSE Emerging Markets (VWO), will soon be adding China A-shares to its benchmark index. This development will also affect Canadian-listed ETFs that include this fund as an underlying holding.
Taking the A-train
Let’s look at what this means for indexers…

When Kristi Sullivan quizzed her husband about how much money she made last year, the Denver financial planner was shocked to discover he was off by a wide margin.

The Financial Post’s Jonathan Ratner looks at some of the day’s top business and financial stories.

Inflation is the single biggest risk for retirees, with 58% of pre-retirees and 45% of retirees worried about the potential for rising prices to erode purchasing power, finds a Fidelity Investment survey.
“Inflation hurts retirees more than any other group,” says Peter Drake, vice-president, retirement and economic research, Fidelity Investments Canada. “In retirement, you have to plan for inflation because it can do a lot of damage over the long term.”
The stress-free guide to retiring rich »
Additional risks include:

healthcare (53% of pre-retirees are concerned vs. 42% of retirees);
asset allocation (46% of pre-retirees vs. 31% of retirees);
running out of money (46% vs. 30%); and
longevity (49% vs. 33%).

The survey also found that 62% of pre-retirees expect to continue working in retirement, and 54% of those that work do so for financial reasons. Meanwhile, 27% of retirees are currently working at least part-time.
The true cost of retirement »
Still, 85% of retirees have a positive outlook on retirement…

Aging Canadian baby boomers are increasingly in the sweet spot for financial planners and eldercare professionals. At last week’s National Elder Planning Issues Conference in Niagara Falls, founding faculty member Peter Wouters and a director of Empire Life Investments told the audience it needs to rethink retirement and its relevance to their practices.
Wouters described a “silver tsunami” of leading-edge boomers that started turning 65 four years ago. Now the eldest members of that cohort start turning 70 next year; indeed 12,500 North Americans turn 50 every day or one every seven seconds.
He reminded advisors their customers may know what they’re retiring from, but many have only a vague idea of what they’re retiring to.
When the industry interviews pre-retirees they think they will miss the money once they retire but in practice, retirees miss the social interaction; hence many “unretire” or launch encore careers.
And advisors are aging right along with their customers: Wouters pointed out the average age of an advisor in Canada is now 58…