EPTEdit: They have replied.
Trading/Investing Thread - Page 143
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SC-Shield
Bulgaria804 Posts
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Malinor
Germany4717 Posts
a) Vanguard FTSE All-World (2/3) b) iShares S&P 500 (1/3) In the medium term, I’d like to reduce my US exposure to 50-60%, but with 64% US in All-World and 100% US in S&P 500, that’s not possible with just these two ETFs. I’m considering adding a third ETF based on the MSCI ex USA Index: www.justetf.com I like its country distribution, and with 0% US exposure, it would help diversify my portfolio. While the US has outperformed since 2008, history suggests other markets should eventually catch up again. My question: Is this adjustment even necessary? If US stocks lose their edge, wouldn’t the All-World ETF automatically rebalance over time? In this case I would miss out on the potential gains from the ex-US ETF, but I would also avoid the risk of it underperforming long-term, as it has done the last two decades. Selling shares from the other ETFs is not an option, this would just be wasteful and tax inefficient. Bonus question: I have a “legacy” stock position from a stock split a few years back. It pays a good dividend and has performed well, but it is a tiny position (like 0,22%) and it doesn’t fit my simplification goal. Would you keep or reallocate? I believe with All-World + S&P 500, I cannot really go wrong. My question is more conceptual—what would other people do here? | ||
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decafchicken
United States19928 Posts
On February 20 2025 10:01 Malinor wrote: I would love some input on this: I’ve been investing since late 2016 and recently streamlined my portfolio to address some of the flaws that accumulated. My ETF allocation is: a) Vanguard FTSE All-World (2/3) b) iShares S&P 500 (1/3) In the medium term, I’d like to reduce my US exposure to 50-60%, but with 64% US in All-World and 100% US in S&P 500, that’s not possible with just these two ETFs. I’m considering adding a third ETF based on the MSCI ex USA Index: www.justetf.com I like its country distribution, and with 0% US exposure, it would help diversify my portfolio. While the US has outperformed since 2008, history suggests other markets should eventually catch up again. My question: Is this adjustment even necessary? If US stocks lose their edge, wouldn’t the All-World ETF automatically rebalance over time? In this case I would miss out on the potential gains from the ex-US ETF, but I would also avoid the risk of it underperforming long-term, as it has done the last two decades. Selling shares from the other ETFs is not an option, this would just be wasteful and tax inefficient. Bonus question: I have a “legacy” stock position from a stock split a few years back. It pays a good dividend and has performed well, but it is a tiny position (like 0,22%) and it doesn’t fit my simplification goal. Would you keep or reallocate? I believe with All-World + S&P 500, I cannot really go wrong. My question is more conceptual—what would other people do here? Assuming these are in a non-tax advantaged accounts that will trigger a taxable event, I'd still probably wind down the FTSE all world especially if any losses can be harvested and/or at LTCG rates and move more into SPY. You could also look into selling covered calls on your SPY and reinvest the premiums to make up some ground. For diversification I'd look at uncorrelated assets with upside I'd expect to perform well in the US protectionism, global unrest, deregulation environment like energy & mining ETFs and/or emerging market ETFs (brazil, india, africa, middle east). I'd get rid of the legacy stock. 0.22% is an allocation for a moonshot not a dividend play lol | ||
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