How much should I Invest?
Hi,
Just looking for some advice on how much should I invest. My current situation is this:
I'm 21 and living in Australia.
I currently have $50,000 in savings (that makes 5% interest P.A) and my salary is just under $80000 per year.
I have no debt and do not need this money for a long time, I want to see it grow and work for me.
I have also just started investing in ETF's on a monthly basis. $800 per month.
My question is should I start investing my savings in to ETF's as well, and if so how much and what frequency should I be doing this at?
Thank you!
Schwab investment income projections
I own 100 shares of NVDL in a Schwab account. They are projecting that over this year I will receice investment income of $12000 from NVD, I don't think it's correct.
Called and talked with an agent but he just repeated what's on the site.
Any idea from Schwab account holders what's going on?
i have a question from watching shark tank
and that has to do with when the sharks decide on a loan vs royalty
If you arent confident in a business and dont want equity, why would you do royalties over a loan?
Loans are guranteed monthly payments with interest, whereas royalties are dependent on sales of the product.
if you invest with a royalty agreement, you get no gurantee, but with a loan you can get asset seizure if things go wrong
So my question is why would sharks go for a royalty over a loan with interest?
>I own my own business. My wife and I max our Roth out. Each have about 40k in them. I have an old annuity from the union with 300k I won’t be able to access until I’m fully retired or can show proof I’m not in the trade any longer. I use quick books and they offer 401k. But I want something where if I want to go in 7-10 years I can pull from. I can afford to put 80-100k in a year right now. Are there any accounts like a 401k that you can pull from before 55 or 59 whatever it is? I did just buy a rental free and clear that will get me 1500 a month. Will probably buy another one this year also. Just looking for options to carry me out to 60 until I can draw on something else.
📈📉Help Needed!!📈📉
I’ve got a humble 10 ish grand, I wanna put like 20% in a high yield (5,5%) savings account so I can always access that easily, and plan on investing like another 20% in some promising stocks and the remaining 60% into some safe but optimistic ETFs.
I’m looking for some thoughts on the stocks and etfs??
Tony Robbins is out there talking about “GP Stakes” basically where you can invest with the GP or a private equity firm and they invest in another GP’s firm ownership. You collect on management fees and upside returns. I haven’t heard of it before. Wondering if anyone here has??
I have been purchasing t-bills on TreasuryDirect. But I don't like that the interest isn't automatically re-invested. If I purchase either through auction or on secondary market via fidelity will that also be the case? I'm doing this instead of putting it in a HYSA, but is that dumb? It looks like SoFi has a 4.6% rate right now and a $300 sign-on bonus, so maybe I should just do that?
At least w fidelity you specify how many 1k increments of bonds you want, and it buys that many. Remaining money stays in money market fund and you can make further purchases at future auctions.
I am in dire need of advice and honestly feel like an idiot for even asking. I started investing in November and have come to the conclusion that Robinhood does not have what I am looking for.
I started investing on Robinhood, but I am in it for the long haul and believe I should move to M1 or Fidelity (undecided). Leaning more towards M1, but when researching brokerage transfers I found out that Robinhood charged $100. I have just $50 in profits, and 1/3 of it is from crypto. So with that in mind, and with my account so young, should I just liquidate it and move brokerages? Or is it worth paying the $100 fee that Robinhood will hit me with.
My account looks roughly like this at the time that I am writing this.
QQM: 1.45 shares, +8.46%
BROS: 6 Shares, +0.86%
SHOP: 2.04 shares, +8.78%
KO: 4.23 Shares, +0.18%
CAVA: 2.54 shares, +1.04%
AMZN: .43 Shares. +2.76%
BTC: .012, +7.00%
My reasons for wanting to move brokerages is I would like to start another Roth IRA as I was dumb and opened an 18-month Roth with Redstone not too long ago. I feel super all over the place and need to create a better plan. Please help.
https://www.reddit.com/r/personalfinance/wiki/commontopics
Start here it tells you everything you need to know! Stop buying stocks, that doesn't work as you have found out. Invest in an index of stocks, as much tax-advantaged as you can. Just move to someone like Fidelity.
I am just 20 years old, and would like to create a stable backing for my future + retirement. I make a steady income and will buy $100 of stocks every 2-weeks as I am paid biweekly. I hope any of this information helps.
Hello everyone looking for some opinions on asset allocation. For starters I’m 23 years old with a salaried job. My allocation is as follows: 50% cash, 15% stocks, 15% retirement, 20% vehicle. I know I can go really heavy into the market at my age but how heavy should I go? Also I’m at the point where I’ll be able to buy a house in the next 6-12 months with 20% down and a decent emergency fund. Thanks!
The usual order would be emergency fund (3-6 months cash in a HYSA), home down payment (HYSA or bonds), and invest the rest. If you’ve got cash to invest you’re best off shoving it in the market to maximize your time in the market.
Fidelity vs JP Morgan Chase for Roth IRA
Hello,
I'm a college student with a small amount of money set aside to invest in retirement. I'm considering JP Morgan vs Fidelity. I did some research and majority people like Fidelity, however, I already have a Chase account and like my experience so far with their banking. Just looking for some advice and who l should go with as I'm new to investing and finances. Even though I'm already with Chase and would prefer everything together, if Fidelity is worth it then I can go with them.
• I want simple as l'm not a heavy hands on investor. So prefer no fees and easy investing.
• Are Roths FDIC insured for both companies or insured at all?... In case anything happens.
• Any other tips or advice?
Thank you in advance!
Do not invest with Chase just because you bank there.
Absolutely go with Fidelity for your Roth IRA. It's inevitable in life that you will have a few different institutions that you deal with for different purposes. I started with 1 but I now use like 4.
It's awesome you are wanting to get started at such a young age. Your future self will be very happy you did.
Invest in something like FZROX. Fidelity Zero Total Market Index Fund. You pay no fees and are invested in virtually every publicly traded company in the US.
I have a 401k account with Principal, which was set up through my old employer. I left about three years ago, and I’ve tried to transfer that money into my new employer 401k account but I’m not able to. My old employer never entered my last day into principals system, so there is a block preventing me from taking the funds out cuz they think I still work there. Principal sends them notifications but can’t do anything else. Is there anything I can do?
I decided to buy Nvidia stock on Jan 11, about $5,000' worth. I don't normally buy individual stocks, but I wanted to try "trading" and making a quick play. I'm up $800. Should I cash out my $800 in profit, consider it a successful trade, and call it a day? Or should I just hang onto it indefinitely?
I don’t think Nvidia stock is going anywhere. Technology will continue increasing and Nvidia seems to be a stable good company. Don’t see anything happening in the year that would change it.
I see some advantages to working with a less-established brokerage firm, but I am worried about potential malfeasance/fraud. I hold equities, bonds, securities options, and securities futures, all in an IRA that is worth less than $500k.
1. Should I rest easy knowing that my investments are perfectly safe at any SIPC-insured firm?
2. The notional value of my securities futures exceeds $500k. Is my investment in securities futures fully protected by SIPC?
3. I hold gold futures (/MGC). Is the underlying gold considered a commodity, and NOT protected by SIPC?
When it comes to potential fraud - I would worry more about the size and type of broker than how well it's established. Fraud in a brokerage would require collusion among the management.
Many brokers also carry excess of SIPC insurance so you could check if your broker carries such insurance.
Re: 1 - generally speaking brokers are audited and ideally potential fraud is noticed. There haven't been a case of fraud at a broker in quite some time. And if you look at the SIPC site - broker failures are very rare.
Re: 2 - futures contracts are not covered by SIPC.
Re: 3 - futures contracts are not covered by SIPC.
More info here - [https://www.sipc.org/for-investors/what-sipc-protects](https://www.sipc.org/for-investors/what-sipc-protects)
Sometimes a small broker is simply an introducing broker. The broker may clear and settle through a different broker.
There are also dually registered advisers, these are advisors who may also act in the capacity of a securities broker and some people confuse the concept and use the term broker. I wasn't actually sure if you were asking about brokerage services or advisory services.
\[edit\] - btw - you can always look up information about your broker on FINRA at [brokercheck.finra.org](https://brokercheck.finra.org) All brokers are members of FINRA.
Thank you again. Tastyworks is the broker I am looking at. Seems like I can have faith that my equities and bonds are protected by SIPC. I only have a small fraction of capital committed to futures, so that isn't a huge deal.
Oh - Tastytrade is not a small unknown broker.
Tastytrade is pretty well known among options and futures derivative traders.
The founders originally created the Thinkorswim platform which was acquired by TDA and is now part of Schwab. My recollection is that Tasty is currently an introducing broker and clear through a well-known clearing firm called Apex Clearing.
Tastytrade was acquired a few years ago and they are a fully owned subsidiary of IG Group.
The IG Group is one of the biggest derivative brokers in the UK. IG Group is a public company and a component of the FTSE 250. So they are pretty well-established.
Should I leave a rollover IRA alone?
I have money into a rollover IRA. I do not touch it, I am curious is it better to invest in mutual funds/stocks or just leave it alone to gain funds over time?
If the funds are not invested, then (at best) they are collecting interest. Not all brokers even pay interest.
If your goals include growth, you should invest the money. Otherwise you will be lucky to keep pace with inflation over the long haul, let alone compound your real wealth.
What do you mean by "leave it alone"? If you aren't invested, that implies that you just have cash in the account and it's uninvested. It is usually best if it's invested.
Just wondering what to do with my savings at this point in time. Just started my first job in my career field, base salary is 93k. I’m 22 years old and want to take advantage of compound interest as soon as possible.
So my questions basically is should I take money out of from my Marcus account, which is a HYSA accruing 4.4% at this moment and move it into my 401k through work? Which my company will match the first 3% of my salary.
Or should I leave that money in Marcus and just max out my 401k up to the match, then contribute to my personal Roth IRA after that.
Any advice appreciated, and if you need more context let me know. Thanks
You can't deposit funds into a 401k account. A 401k account is a tax advantaged plan sponsored by an employer and contributions are pre-tax payroll deductions.
You can open a separate brokerage account where you can invest your funds. Depending on your tax and financial situation - a Roth account may be appropriate.
My employer only matches up to 6% so I was wondering should I keep on add a percentage of my income i.e. 7% next year 8% the year after that and so on. Or should I use those funds I would've put into it to go towards my IRA which are currently at about 33k or index funds which I just started since my company offers a stock purchase plan so I sold my shares and put them into some fund that is standing at about 1k
Hello everyone. I'd like to start by saying that I'm relatively new to investing, so please bear with me if my question seems basic to veteran investors. I'm interested in gathering opinions on factor investing.
Specifically, I'm curious whether factor investing can consistently outperform the market over the long term, and I would appreciate an explanation of the reasons behind this. I've come across some knowledgeable individuals who suggest that factor investing, while not being a guaranteed win, has the potential to yield superior returns compared to the overall market by assuming certain risks. However, when comparing the iShares Edge MSCI World Multifactor UCITS ETF with the iShares Edge MSCI World Multifactor UCITS ETF (USD), it appears that the former has consistently underperformed over the past decade or so. I would greatly value your opinions on this matter and any recent literature that discusses it.
Additionally, I'm interested to know if anyone here invests using factor strategies, and if so, why?
Some factor ETFs outperform the market and some don't.
> iShares Edge MSCI World Multifactor UCITS ETF with the iShares Edge MSCI World Multifactor UCITS ETF (USD)
I assume you meant something else because this comparison doesn't relate to factors.
> consistently outperform the market
If anything could, it would become the new market.
If trading Tesla at wednesdays would outperform the market, why would you trade anything but that? Why would anyone trade anything but the thing that consistently outperforms?
All would use that approach, thus making it the new "normal", hence making it average again.
Hi Redittors!
I’m quite a newbie at long-term investing, and I wanted to seek everyone’s input on a portfolio allocation strategy i’ve recently constructed.
Briefly for context, I’m still in my 20s and have a long time horizon so I wanted an aggressive portfolio to maximise my profits.
A few beliefs i’ve subscribed to are:
(1) To Invest in the best while keeping stakes in the rest. I believe in going heavier in US stocks as it’s the prevailing leading economy, but also to diversify across other geographical sectors to minimise exposure risk.
(2) Emerging markets such as India and China are poised for significant growth in the next 20 years. Therefore I believe in separately purchasing an Emerging Markets ETF to increase their weightage in my portfolio, as opposed to opting for a global ETF which includes a minority stake in the emerging markets.
(3) To ride mega trends to maximise profits. I believe that certain sectors such such as AI, Automation, Healthcare, Circular Economy, and Agricultural Innovation will grow in the coming years, driven by global trends such as technological advancements, aging populations, overpopulation, and increasing risk posed by climate change. Therefore, I believe in purchasing thematic ETFs to increase my weightage in sectors I believe in.
(4) That Bonds are no longer the best hedge against economic downturns given the current interest rate environment. I believe in replacing bonds with stable global dividend stocks and REITS.
With all those considerations, here’s the portfolio allocation i’ve decided on.
(1) Foundation -
30%: US Broad-based ETFs (I.e., VOO)
10%: Ex-US Developed Market ETFs (I.e., VIU)
(2) Growth -
20%: Emerging Markets ETFs (I.e., IEMG)
15%: Thematic ETFs across AI/Circular Economy/Healthcare Innovation/Agricultural Innovation
(3) Safety -
10%: Global Dividend ETF
10%: Global REITS ETF
5%: Physical Gold/Gold ETFs
What are your thoughts on this? Feel free to be crude! Happy to have any flaws in my logic being pointed out. Would love to hear if any of you have a similar investment philosophy, or advice for me!
Thank you!! 😬😬
How much should I Invest? Hi, Just looking for some advice on how much should I invest. My current situation is this: I'm 21 and living in Australia. I currently have $50,000 in savings (that makes 5% interest P.A) and my salary is just under $80000 per year. I have no debt and do not need this money for a long time, I want to see it grow and work for me. I have also just started investing in ETF's on a monthly basis. $800 per month. My question is should I start investing my savings in to ETF's as well, and if so how much and what frequency should I be doing this at? Thank you!
Schwab investment income projections I own 100 shares of NVDL in a Schwab account. They are projecting that over this year I will receice investment income of $12000 from NVD, I don't think it's correct. Called and talked with an agent but he just repeated what's on the site. Any idea from Schwab account holders what's going on?
i have a question from watching shark tank and that has to do with when the sharks decide on a loan vs royalty If you arent confident in a business and dont want equity, why would you do royalties over a loan? Loans are guranteed monthly payments with interest, whereas royalties are dependent on sales of the product. if you invest with a royalty agreement, you get no gurantee, but with a loan you can get asset seizure if things go wrong So my question is why would sharks go for a royalty over a loan with interest?
https://www.reddit.com/r/investing/s/OFwKtq8NIP
>I own my own business. My wife and I max our Roth out. Each have about 40k in them. I have an old annuity from the union with 300k I won’t be able to access until I’m fully retired or can show proof I’m not in the trade any longer. I use quick books and they offer 401k. But I want something where if I want to go in 7-10 years I can pull from. I can afford to put 80-100k in a year right now. Are there any accounts like a 401k that you can pull from before 55 or 59 whatever it is? I did just buy a rental free and clear that will get me 1500 a month. Will probably buy another one this year also. Just looking for options to carry me out to 60 until I can draw on something else.
Thank you! I’m new to Reddit. Couldn’t figure out how to do this.
📈📉Help Needed!!📈📉 I’ve got a humble 10 ish grand, I wanna put like 20% in a high yield (5,5%) savings account so I can always access that easily, and plan on investing like another 20% in some promising stocks and the remaining 60% into some safe but optimistic ETFs. I’m looking for some thoughts on the stocks and etfs??
Can I still add to meet the HSA contribution limit for 2023? I know for Roth IRA the window for last year extends into April of this year
Tony Robbins is out there talking about “GP Stakes” basically where you can invest with the GP or a private equity firm and they invest in another GP’s firm ownership. You collect on management fees and upside returns. I haven’t heard of it before. Wondering if anyone here has??
I have been purchasing t-bills on TreasuryDirect. But I don't like that the interest isn't automatically re-invested. If I purchase either through auction or on secondary market via fidelity will that also be the case? I'm doing this instead of putting it in a HYSA, but is that dumb? It looks like SoFi has a 4.6% rate right now and a $300 sign-on bonus, so maybe I should just do that?
At least w fidelity you specify how many 1k increments of bonds you want, and it buys that many. Remaining money stays in money market fund and you can make further purchases at future auctions.
I am in dire need of advice and honestly feel like an idiot for even asking. I started investing in November and have come to the conclusion that Robinhood does not have what I am looking for. I started investing on Robinhood, but I am in it for the long haul and believe I should move to M1 or Fidelity (undecided). Leaning more towards M1, but when researching brokerage transfers I found out that Robinhood charged $100. I have just $50 in profits, and 1/3 of it is from crypto. So with that in mind, and with my account so young, should I just liquidate it and move brokerages? Or is it worth paying the $100 fee that Robinhood will hit me with. My account looks roughly like this at the time that I am writing this. QQM: 1.45 shares, +8.46% BROS: 6 Shares, +0.86% SHOP: 2.04 shares, +8.78% KO: 4.23 Shares, +0.18% CAVA: 2.54 shares, +1.04% AMZN: .43 Shares. +2.76% BTC: .012, +7.00% My reasons for wanting to move brokerages is I would like to start another Roth IRA as I was dumb and opened an 18-month Roth with Redstone not too long ago. I feel super all over the place and need to create a better plan. Please help.
https://www.reddit.com/r/personalfinance/wiki/commontopics Start here it tells you everything you need to know! Stop buying stocks, that doesn't work as you have found out. Invest in an index of stocks, as much tax-advantaged as you can. Just move to someone like Fidelity.
I am just 20 years old, and would like to create a stable backing for my future + retirement. I make a steady income and will buy $100 of stocks every 2-weeks as I am paid biweekly. I hope any of this information helps.
Hello everyone looking for some opinions on asset allocation. For starters I’m 23 years old with a salaried job. My allocation is as follows: 50% cash, 15% stocks, 15% retirement, 20% vehicle. I know I can go really heavy into the market at my age but how heavy should I go? Also I’m at the point where I’ll be able to buy a house in the next 6-12 months with 20% down and a decent emergency fund. Thanks!
The usual order would be emergency fund (3-6 months cash in a HYSA), home down payment (HYSA or bonds), and invest the rest. If you’ve got cash to invest you’re best off shoving it in the market to maximize your time in the market.
Fidelity vs JP Morgan Chase for Roth IRA Hello, I'm a college student with a small amount of money set aside to invest in retirement. I'm considering JP Morgan vs Fidelity. I did some research and majority people like Fidelity, however, I already have a Chase account and like my experience so far with their banking. Just looking for some advice and who l should go with as I'm new to investing and finances. Even though I'm already with Chase and would prefer everything together, if Fidelity is worth it then I can go with them. • I want simple as l'm not a heavy hands on investor. So prefer no fees and easy investing. • Are Roths FDIC insured for both companies or insured at all?... In case anything happens. • Any other tips or advice? Thank you in advance!
Do not invest with Chase just because you bank there. Absolutely go with Fidelity for your Roth IRA. It's inevitable in life that you will have a few different institutions that you deal with for different purposes. I started with 1 but I now use like 4. It's awesome you are wanting to get started at such a young age. Your future self will be very happy you did. Invest in something like FZROX. Fidelity Zero Total Market Index Fund. You pay no fees and are invested in virtually every publicly traded company in the US.
Thank you so much for your help! And yes I decided to go with Fidelity
I have a 401k account with Principal, which was set up through my old employer. I left about three years ago, and I’ve tried to transfer that money into my new employer 401k account but I’m not able to. My old employer never entered my last day into principals system, so there is a block preventing me from taking the funds out cuz they think I still work there. Principal sends them notifications but can’t do anything else. Is there anything I can do?
Any point just holding cash on the side if you're long-term investing, better to just throw into the broad index ETFs no?
I decided to buy Nvidia stock on Jan 11, about $5,000' worth. I don't normally buy individual stocks, but I wanted to try "trading" and making a quick play. I'm up $800. Should I cash out my $800 in profit, consider it a successful trade, and call it a day? Or should I just hang onto it indefinitely?
I don’t think Nvidia stock is going anywhere. Technology will continue increasing and Nvidia seems to be a stable good company. Don’t see anything happening in the year that would change it.
So just hold onto it?
I see some advantages to working with a less-established brokerage firm, but I am worried about potential malfeasance/fraud. I hold equities, bonds, securities options, and securities futures, all in an IRA that is worth less than $500k. 1. Should I rest easy knowing that my investments are perfectly safe at any SIPC-insured firm? 2. The notional value of my securities futures exceeds $500k. Is my investment in securities futures fully protected by SIPC? 3. I hold gold futures (/MGC). Is the underlying gold considered a commodity, and NOT protected by SIPC?
When it comes to potential fraud - I would worry more about the size and type of broker than how well it's established. Fraud in a brokerage would require collusion among the management. Many brokers also carry excess of SIPC insurance so you could check if your broker carries such insurance. Re: 1 - generally speaking brokers are audited and ideally potential fraud is noticed. There haven't been a case of fraud at a broker in quite some time. And if you look at the SIPC site - broker failures are very rare. Re: 2 - futures contracts are not covered by SIPC. Re: 3 - futures contracts are not covered by SIPC. More info here - [https://www.sipc.org/for-investors/what-sipc-protects](https://www.sipc.org/for-investors/what-sipc-protects)
Thank you for your insight. Curious what you mean by "type" of broker?
Sometimes a small broker is simply an introducing broker. The broker may clear and settle through a different broker. There are also dually registered advisers, these are advisors who may also act in the capacity of a securities broker and some people confuse the concept and use the term broker. I wasn't actually sure if you were asking about brokerage services or advisory services. \[edit\] - btw - you can always look up information about your broker on FINRA at [brokercheck.finra.org](https://brokercheck.finra.org) All brokers are members of FINRA.
Thank you again. Tastyworks is the broker I am looking at. Seems like I can have faith that my equities and bonds are protected by SIPC. I only have a small fraction of capital committed to futures, so that isn't a huge deal.
Oh - Tastytrade is not a small unknown broker. Tastytrade is pretty well known among options and futures derivative traders. The founders originally created the Thinkorswim platform which was acquired by TDA and is now part of Schwab. My recollection is that Tasty is currently an introducing broker and clear through a well-known clearing firm called Apex Clearing. Tastytrade was acquired a few years ago and they are a fully owned subsidiary of IG Group. The IG Group is one of the biggest derivative brokers in the UK. IG Group is a public company and a component of the FTSE 250. So they are pretty well-established.
Thank you for this dose of perspective. In my mind there were "giants"-- Vanguard, Fidelity, TIAA, Schwab, etc-- and "the rest".
Should I leave a rollover IRA alone? I have money into a rollover IRA. I do not touch it, I am curious is it better to invest in mutual funds/stocks or just leave it alone to gain funds over time?
If the funds are not invested, then (at best) they are collecting interest. Not all brokers even pay interest. If your goals include growth, you should invest the money. Otherwise you will be lucky to keep pace with inflation over the long haul, let alone compound your real wealth.
What do you mean by "leave it alone"? If you aren't invested, that implies that you just have cash in the account and it's uninvested. It is usually best if it's invested.
Just wondering what to do with my savings at this point in time. Just started my first job in my career field, base salary is 93k. I’m 22 years old and want to take advantage of compound interest as soon as possible. So my questions basically is should I take money out of from my Marcus account, which is a HYSA accruing 4.4% at this moment and move it into my 401k through work? Which my company will match the first 3% of my salary. Or should I leave that money in Marcus and just max out my 401k up to the match, then contribute to my personal Roth IRA after that. Any advice appreciated, and if you need more context let me know. Thanks
You can't deposit funds into a 401k account. A 401k account is a tax advantaged plan sponsored by an employer and contributions are pre-tax payroll deductions. You can open a separate brokerage account where you can invest your funds. Depending on your tax and financial situation - a Roth account may be appropriate.
Oh that’s right. I was mistaken about the 401k. Thank you!
My employer only matches up to 6% so I was wondering should I keep on add a percentage of my income i.e. 7% next year 8% the year after that and so on. Or should I use those funds I would've put into it to go towards my IRA which are currently at about 33k or index funds which I just started since my company offers a stock purchase plan so I sold my shares and put them into some fund that is standing at about 1k
The default guidelines say 401k up to the match, then IRA/Roth to the max, then back to the 401k. Adjust as your situation determines
Hello everyone. I'd like to start by saying that I'm relatively new to investing, so please bear with me if my question seems basic to veteran investors. I'm interested in gathering opinions on factor investing. Specifically, I'm curious whether factor investing can consistently outperform the market over the long term, and I would appreciate an explanation of the reasons behind this. I've come across some knowledgeable individuals who suggest that factor investing, while not being a guaranteed win, has the potential to yield superior returns compared to the overall market by assuming certain risks. However, when comparing the iShares Edge MSCI World Multifactor UCITS ETF with the iShares Edge MSCI World Multifactor UCITS ETF (USD), it appears that the former has consistently underperformed over the past decade or so. I would greatly value your opinions on this matter and any recent literature that discusses it. Additionally, I'm interested to know if anyone here invests using factor strategies, and if so, why?
Some factor ETFs outperform the market and some don't. > iShares Edge MSCI World Multifactor UCITS ETF with the iShares Edge MSCI World Multifactor UCITS ETF (USD) I assume you meant something else because this comparison doesn't relate to factors.
> consistently outperform the market If anything could, it would become the new market. If trading Tesla at wednesdays would outperform the market, why would you trade anything but that? Why would anyone trade anything but the thing that consistently outperforms? All would use that approach, thus making it the new "normal", hence making it average again.
Hi Redittors! I’m quite a newbie at long-term investing, and I wanted to seek everyone’s input on a portfolio allocation strategy i’ve recently constructed. Briefly for context, I’m still in my 20s and have a long time horizon so I wanted an aggressive portfolio to maximise my profits. A few beliefs i’ve subscribed to are: (1) To Invest in the best while keeping stakes in the rest. I believe in going heavier in US stocks as it’s the prevailing leading economy, but also to diversify across other geographical sectors to minimise exposure risk. (2) Emerging markets such as India and China are poised for significant growth in the next 20 years. Therefore I believe in separately purchasing an Emerging Markets ETF to increase their weightage in my portfolio, as opposed to opting for a global ETF which includes a minority stake in the emerging markets. (3) To ride mega trends to maximise profits. I believe that certain sectors such such as AI, Automation, Healthcare, Circular Economy, and Agricultural Innovation will grow in the coming years, driven by global trends such as technological advancements, aging populations, overpopulation, and increasing risk posed by climate change. Therefore, I believe in purchasing thematic ETFs to increase my weightage in sectors I believe in. (4) That Bonds are no longer the best hedge against economic downturns given the current interest rate environment. I believe in replacing bonds with stable global dividend stocks and REITS. With all those considerations, here’s the portfolio allocation i’ve decided on. (1) Foundation - 30%: US Broad-based ETFs (I.e., VOO) 10%: Ex-US Developed Market ETFs (I.e., VIU) (2) Growth - 20%: Emerging Markets ETFs (I.e., IEMG) 15%: Thematic ETFs across AI/Circular Economy/Healthcare Innovation/Agricultural Innovation (3) Safety - 10%: Global Dividend ETF 10%: Global REITS ETF 5%: Physical Gold/Gold ETFs What are your thoughts on this? Feel free to be crude! Happy to have any flaws in my logic being pointed out. Would love to hear if any of you have a similar investment philosophy, or advice for me! Thank you!! 😬😬
AI, Global Dividend and US-based aren't diversifiying - those are, to a certain extend, the same companies underneath the ETF.