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Post by rgs2001uk on Jan 24, 2020 22:03:00 GMT 7
I personally wouldnt invest a sum of that amount in one fund, I would look to invest in at least three if not four funds.
You say you have 5 million baht, I see the Euro is roughly 33.2, 5,000.000/33.2 = roughly 150k Euros, go for say 3 lots of 50k euros, or 5 lots of 30k euros, no more than that.
I agree with the point above about $ averaging, get straight in from day one.
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AyG
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Post by AyG on Jan 25, 2020 12:01:44 GMT 7
I personally wouldnt invest a sum of that amount in one fund, I would look to invest in at least three if not four funds. Neither would I, because I believe I can identify fund managers who are likely (on balance, and only on balance) to outperform an equivalent passive fund. However, for someone who doesn't have that confidence and chooses to go down the passive route a simple, global ETF fits the bill. Some people might think "Oh, Europe is going to do well?" so add a Europe ETF. However, are they likely to be right? I think with a passive strategy it's key to acknowledge one's inability to predict what will happen. (Who would have thought that the US markets would do so well with an irrational imbecile as President?) And that means not taking bets on geographical regions or industry sectors. For comparison, of my 27 non-Thai holdings, only 9 have outperformed iShares Edge MSCI World Minimum Volatility UCITS ETF USD (Acc) GBP over the last 12 months. |
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chiangmai
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Post by chiangmai on Jan 26, 2020 7:18:18 GMT 7
I personally wouldnt invest a sum of that amount in one fund, I would look to invest in at least three if not four funds. For comparison, of my 27 non-Thai holdings, only 9 have outperformed iShares Edge MSCI World Minimum Volatility UCITS ETF USD (Acc) GBP over the last 12 months. Wow, that's a pretty strong argument in favour of the iShares ETF if even experienced investors can't beat the averages to that extent. It would be interesting though to understand what percentage of your annual profits result from those that do beat the index compared to those that don't. |
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AyG
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Post by AyG on Jan 26, 2020 7:36:00 GMT 7
^^^ A couple of points:
(1) The last twelve months have been exceptionally good for US stocks, so the ETF, which is almost 60% allocated to the US has done well. Over the longer term, it's a bit less impressive, for example 14th out of 25 holdings over 5 years.
(2) My overall portfolio has a significant allocation to index linked bonds and to infrastructure - defensive investments which would not be expected to perform as well as the ETF. It's a price I'm willing to pay for some protection against the ravages of inflation when it kicks in again.
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Post by eldivino on Feb 2, 2020 11:14:07 GMT 7
Also, and i know there's many opinions on this, but all things considered and taking into account the state of the economy now, would it be wise to invest the whole sum that i'd like to set aside for (much) later in low cost index funds NOW, or better to gradually transfer, for example every 3 months or so buy more of the funds? If the stock market will crash in the near future, it’s better to not invest everything now. But if it doesn’t crash in the near future, you better invest everything now. That means you now have find that white crystal ball that can tell what happens in the future. My personal take on this is: market timing doesn’t work. Even less so for beginners like us. Look at the MSCI World chart. At any given time over the last 20 years people should have said to better not invest now but wait for the crash, because it went always only up, up, up, so the next recession must be near. “ The MSCI World is a market cap weighted stock market index of 1,655 stocks from companies throughout the world. (...) The index includes a collection of stocks of all the developed markets in the world, as defined by MSCI. The index includes securities from 23 countries but excludes stocks from emerging and frontier economies making it less worldwide than the name suggests. A related index, the MSCI All Country World Index (ACWI), incorporated both developed and emerging countries. MSCI also produces a Frontier Markets index, including another 31 markets.“ (Wikipedia) This means with an MSCI World you’re already super diversified. Many people mix in 20-30% MSCI Emerging Markets (I do), or Small Caps, or invest in region ETFs (rather than the MSCI World) so that they can control the weights by themselves (which, as far as I understand, doesn’t necessarily outperform the standard weights chosen by the index). Others add additional asset classes like REITs or things like that. Others add bonds to it. For myself, I have decided I only invest in the stock market for now. I invest 70% in an MSCI ACWI IMI and 30% in an MSCI EM IMI (the IMI indicates small caps are included and I’ve added the EM to increase my exposure to emerging markets even though they’re already included in the MSCI ACWI). |
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AyG
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Post by AyG on Feb 3, 2020 7:50:04 GMT 7
I invest 70% in an MSCI ACWI IMI and 30% in an MSCI EM IMI I presume the MSCI ACWI IMI fund is SPDR Portfolio MSCI Global Stock Market ETF [SPGM], and MSCI EM IMI is iShares Core MSCI Emerging Markets ETF [IEMG]. I was wondering whether holding IEMG was adding any value. Here's a comparison chart of the two funds (albeit excluding income). Attachment DeletedIt looks like IEMG has basically gone nowhere. Since inception in 2013 the total annualised return has been 2.8%, which is pretty miserable - not much better than cash. (Incidentally, the bid/ask spread is currently 2.6%, so that eats up one year's total return.) SPGM since inception (also in 2013) has returned an annualised total return of 9.2%, which is much more healthy. Turning to 3 year volatility, IEMG is 14.2%, and SPGM 11.6%. Maximum drawdowns are -22.4% and -14.1% respectively. It would appear that overweighting Emerging Markets has led to lower returns and higher risk. Looking back over my investing history, I've made similar calls, most of which haven't paid off. The story for Emerging Markets has typically been one of an emerging middle class with increased spending capacity. However, Emerging Markets are typically heavily dependent upon energy and/or natural resources, the prices of which are largely unpredictable. I do hold one emerging markets fund JMG. It's one of my oldest holdings (well over 20 years). Rationally speaking, I should have sold it long ago, but it continues to perform well, and I'm emotionally attached. Over the years I have similarly been lured into Frontier Markets, Natural Resources, Absolute Return funds and "alternatives" (specifically Arch Cru). None of these has paid off. I'd have been better off sticking to more mainstream equities. Fortunately, the allocation hasn't been too large. I would even say that my allocation to the Thai stock market has been a mistake, with miserable performance since the latest junta took over the country. (Chart from Schwab, other data from Morningstar.) |
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Post by rgs2001uk on Feb 3, 2020 20:50:49 GMT 7
I invest 70% in an MSCI ACWI IMI and 30% in an MSCI EM IMI I presume the MSCI ACWI IMI fund is SPDR Portfolio MSCI Global Stock Market ETF [SPGM], and MSCI EM IMI is iShares Core MSCI Emerging Markets ETF [IEMG]. I was wondering whether holding IEMG was adding any value. Here's a comparison chart of the two funds (albeit excluding income). It looks like IEMG has basically gone nowhere. Since inception in 2013 the total annualised return has been 2.8%, which is pretty miserable - not much better than cash. (Incidentally, the bid/ask spread is currently 2.6%, so that eats up one year's total return.)SPGM since inception (also in 2013) has returned an annualised total return of 9.2%, which is much more healthy. Turning to 3 year volatility, IEMG is 14.2%, and SPGM 11.6%. Maximum drawdowns are -22.4% and -14.1% respectively. It would appear that overweighting Emerging Markets has led to lower returns and higher risk.Looking back over my investing history, I've made similar calls, most of which haven't paid off. The story for Emerging Markets has typically been one of an emerging middle class with increased spending capacity. However, Emerging Markets are typically heavily dependent upon energy and/or natural resources, the prices of which are largely unpredictable. I do hold one emerging markets fund JMG. It's one of my oldest holdings (well over 20 years). Rationally speaking, I should have sold it long ago, but it continues to perform well, and I'm emotionally attached.Over the years I have similarly been lured into Frontier Markets, Natural Resources, Absolute Return funds and "alternatives" (specifically Arch Cru). None of these has paid off. I'd have been better off sticking to more mainstream equities. Fortunately, the allocation hasn't been too large. I would even say that my allocation to the Thai stock market has been a mistake, with miserable performance since the latest junta took over the country. (Chart from Schwab, other data from Morningstar.) you forgot to mention inflation. I concur, I got out of them a few years back. Been there done that, last week I offloaded these 3, held them for so long the dividends had paid for the initial cost price, the performance was diabolical, problem, where to invest the proceeds? www.hl.co.uk/shares/shares-search-results/r/royal-dutch-shell-plc-b-shares-eur0.07www.hl.co.uk/shares/shares-search-results/b/bp-plc-ordinary-us$0.25www.hl.co.uk/shares/shares-search-results/r/rio-tinto-plc-ordinary-10pAs I move away from FTSE listed companies to global investment trusts, for me, its the way forward. |
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Post by rgs2001uk on Feb 5, 2020 21:58:16 GMT 7
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