EPTEdit: They have replied.
Trading/Investing Thread - Page 143
| Forum Index > General Forum |
|
SC-Shield
Bulgaria870 Posts
Edit: They have replied. | ||
|
Malinor
Germany4755 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? | ||
|
decafchicken
United States20168 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 | ||
|
Malinor
Germany4755 Posts
On February 20 2025 15:50 decafchicken wrote: 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 In Germany we do not really have tax-advantaged accounts. I mean, we probably have those in some financial instruments for retirement or that you can setup for your children, but not for private investing. The way it works is: you pay 26,38% captial gains tax, but the first 1.000€ capital gains are tax-free. I always chuckle at the 1.000€ tax-free, that number is just so low and irrelevant... sums up Germanys approach quite well, honestly. I have never done more than normal buying and selling, covered calls sound fun, maybe if I have some playaround money available in a few years time. the whole thing about decreasing US-sizing is a long term plan, I am totally fine with getting the US portion down to ~55% in 3 years or so, without tacking drastic measures. If I want to initiate the process, I guess I would have to stop putting in S&P500 or put less money into it than in some exUSA ETF. Writing this down already helps my though process, which is nice. I guess it is a little bit hairsplitting, but I am in the process of re-formulating (or first time formulating) my long term strategie and I just want to get these things clear in my head now. On another note, look at us. Previously discussing weight lifting and powerlifting in the TL H&F thread, and now discussing stocks like grown ups. | ||
|
ETisME
12763 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? My advice is don't think of ex US ETF as more diversify. Most US list companies are already diversified globally, ex US world risk imo is actually more prone to concentrated regional risk and less capability to adapt. And exUS world ETF risk adjusted return is far harder to gauge. You could be concentrating more risk for a lower return. Eg Chinese tech stocks for past couple of years. I would recommend gold if you want some stability in portfolio. a bit Bitcoin if you want to expand a bit into higher risk, like 1%. Or add in a small % in a sector you have good knowledge for. I personally have 30% in Bitcoin, 20% in semi con, 20% in FinTech like block, 10% in infrastructure, 20% in physical gold. No ETF at all. | ||
|
RvB
Netherlands6292 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? Why don't you just sell the s&p 500 and buy the all world index. That's already close to your target of 60%. I'd also allocate some to bonds. Bond returns are attractive compared to stocks at the moment and it reduces risk. | ||
|
Malinor
Germany4755 Posts
On February 21 2025 18:41 RvB wrote: Why don't you just sell the s&p 500 and buy the all world index. That's already close to your target of 60%. I'd also allocate some to bonds. Bond returns are attractive compared to stocks at the moment and it reduces risk. That is a good question actually. The main reason is, that would cost me approximately 5k in taxes, that feels just like throwing money out the window. I also just like having the S&P500. It dawns on me that I may just be in the process of overcomplicating things again and should just stick with what I have. I have thought a lot about Bonds, but I really fail to see the upside of having them. I never understood it and lately the scientific consensus that they should be in a portfolio has weakend, so I heard. I get 2,55% interest on my cash position currently... I guess I could put that into Bonds, but I am not convinced it is worth the effort. | ||
|
decafchicken
United States20168 Posts
On February 21 2025 04:13 Malinor wrote: In Germany we do not really have tax-advantaged accounts. I mean, we probably have those in some financial instruments for retirement or that you can setup for your children, but not for private investing. The way it works is: you pay 26,38% captial gains tax, but the first 1.000€ capital gains are tax-free. I always chuckle at the 1.000€ tax-free, that number is just so low and irrelevant... sums up Germanys approach quite well, honestly. I have never done more than normal buying and selling, covered calls sound fun, maybe if I have some playaround money available in a few years time. the whole thing about decreasing US-sizing is a long term plan, I am totally fine with getting the US portion down to ~55% in 3 years or so, without tacking drastic measures. If I want to initiate the process, I guess I would have to stop putting in S&P500 or put less money into it than in some exUSA ETF. Writing this down already helps my though process, which is nice. I guess it is a little bit hairsplitting, but I am in the process of re-formulating (or first time formulating) my long term strategie and I just want to get these things clear in my head now. On another note, look at us. Previously discussing weight lifting and powerlifting in the TL H&F thread, and now discussing stocks like grown ups. Physical and financial growth 💪 (I still lift a lot too tho 😂) | ||
|
RvB
Netherlands6292 Posts
On February 22 2025 05:20 Malinor wrote: That is a good question actually. The main reason is, that would cost me approximately 5k in taxes, that feels just like throwing money out the window. I also just like having the S&P500. It dawns on me that I may just be in the process of overcomplicating things again and should just stick with what I have. I have thought a lot about Bonds, but I really fail to see the upside of having them. I never understood it and lately the scientific consensus that they should be in a portfolio has weakend, so I heard. I get 2,55% interest on my cash position currently... I guess I could put that into Bonds, but I am not convinced it is worth the effort. Okay, I missed that part of your initial post. Then I'd just keep it how it is. The fund will automatically adjust based on market cap. The scientific consensus has not really changed. Allocating to bonds increases risk adjusted returns. The advantage is that their returns are usually negatively correlated with stocks. Compared to a savings account they're also publicly traded and usually have a fixed coupon instead of a floating rate. That means in a downturn, when rates go down, the price of bonds goes up. There are exceptions of course like with Covid when everything crashed at the same time. | ||
|
SC-Shield
Bulgaria870 Posts
It also seems the primary strategy is buying stocks via call options instead of open market? Portfolio: https://www.quiverquant.com/congresstrading/politician/Nancy Pelosi-P000197 | ||
KwarK
United States44190 Posts
On February 22 2025 19:12 SC-Shield wrote: I know some people discussed Pelosi's portfolio, but it amazes me that her husband or whoever is managing that portfolio possibly outperformed Warren Buffett. Buffett may be a tech dinosaur but it's still impressive. It also seems the primary strategy is buying stocks via call options instead of open market? Portfolio: https://www.quiverquant.com/congresstrading/politician/Nancy Pelosi-P000197 Options = leverage on high margin opportunities. There’s a built in limit to how much you can invest there because you need a counterparty wanting to take the exact same bet on an asset that is appropriately sized for the bet. Berkshire Hathaway’s assets under management are far, far too large to make those kind of bets. It’s much easier to double $1000 than $1b. When Buffett bets he has to buy large chunks of large companies not known for their excess volatility. There’s no degenerate selling billions worth of call options for him to buy. | ||
|
maybenexttime
Poland5838 Posts
| ||
|
KwarK
United States44190 Posts
| ||
|
maybenexttime
Poland5838 Posts
| ||
|
KwarK
United States44190 Posts
| ||
|
Manit0u
Poland17786 Posts
| ||
|
Billyboy
1998 Posts
On February 25 2025 16:39 Manit0u wrote: Maybe a stupid question but I have not invested in anything before and am a total noob when it comes to this. How does one invest in water exactly? I don't think you really can, water is not a traded commodity the way gold is for example. I think Johnson and Johnson controls a huge percentage of bottled water business so that might be the closest but they control a whole bunch of what seems like everything. I really can't think of how you could do it. | ||
|
Acrofales
Spain18365 Posts
On February 26 2025 05:09 Billyboy wrote: I don't think you really can, water is not a traded commodity the way gold is for example. I think Johnson and Johnson controls a huge percentage of bottled water business so that might be the closest but they control a whole bunch of what seems like everything. I really can't think of how you could do it. Nestlé and Coca Cola are far bigger afaik. There's also companies like Veolia in Europe or American Water in the US that filter and distribute tap, and waste, water. But yeah, I also don't know of any publicly traded product that treats water as a commodity.. | ||
|
RvB
Netherlands6292 Posts
https://www.cmegroup.com/markets/equities/nasdaq/nasdaq-veles-california-water-index.html | ||
|
Manit0u
Poland17786 Posts
On March 02 2025 05:56 RvB wrote: CME has futures based on the water price in California. https://www.cmegroup.com/markets/equities/nasdaq/nasdaq-veles-california-water-index.html Yeah. I also found this that explains it in more detail: https://www.investopedia.com/articles/06/water.asp I think I saw somewhere products that are basically buying shares in water reservoirs and stuff but not sure about their validity. | ||
| ||
