Portfolio Advice

Prism

bostonerimus wrote: »

70% Global Equity (eg Vanguard Global Equity Index)
30% Global Bonds (eg Vanguard Global Bond Index)

Drip feed and rebalance when necessary

Why does this need to be difficult?

Some people don't want a 50% US allocation and also wouldn't mind trying to get a better return than pure global index trackers

Thrugelmir

gif1 wrote: »

The reason for picking up Fundsmith is to gain global exposure by market cap via a well performing fund.

That's akin to going surfing after the waves have peaked. Fundsmith has a high US concentration. Recent performance reflects the high valuation placed on many US companies, i.e. demanding.

A_T

Prism wrote: »

Some people don't want a 50% US allocation and also wouldn't mind trying to get a better return than pure global index trackers

The OPs suggested portfolio has 50% US equities.

Prism

A_T wrote: »

The OPs suggested portfolio has 50% US equities.

Yes and was asking for an opinion on it which me and others have suggested could be a bit high right now

bostonerimus

Prism wrote: »

Some people don't want a 50% US allocation and also wouldn't mind trying to get a better return than pure global index trackers

The OP asked for 70/30 with a global/all world exposure. I think a couple of equity and bond global trackers does that. Now if there's a desire to do something different then we can add other stuff or keep bonds to the UK etc.

A_T

Prism wrote: »

Yes and was asking for an opinion on it which me and others have suggested could be a bit high right now

You never mentioned US allocation in relation to the OP's portfolio. You only brought up the subject when bostonerimus suggested something else.

Prism

A_T wrote: »

You never mentioned US allocation in relation to the OP's portfolio. You only brought up the subject when bostonerimus suggested something else.

Well yes I suppose I wasn't very clear but I did say that it was light on Asia and Japan which indirectly means its heavy on US and UK. I don't think the problem is with Fundsmith (which is decent) or a global index tracker, however I do think that increasing exposure to Asia Pacific will help with balance.

gif1

After all your kind comments, I am now considering the following:
- Fundsmith Equity I Acc 45.0%
- Vanguard Emerging Markets Stock Index Acc GBP 10.0%
- Vanguard Japan Stock Index Fund GBP Accumulation 15.0%
- Fixed Income ?? 30.0%

I am now stuck with the Fixed Income asset allocation, as I am not sure how to best build it. The rationale for that would be to act as a buffer when the next equity crash happens. So what is the general consensus in this case? UK or Global? Gilts or Corporate? Short or Long maturity? Active or Passive?
I am struggling to get my head around with the correlation (especially when considering the maturity) between Fixed income and Equity; I guess I would like something to react positively to offset (as much as possible) any negative in the equity sector.
Could you please shed any lights?
Many thanks

economic

gif1 wrote: »

After all your kind comments, I am now considering the following:
- Fundsmith Equity I Acc 45.0%
- Vanguard Emerging Markets Stock Index Acc GBP 10.0%
- Vanguard Japan Stock Index Fund GBP Accumulation 15.0%
- Fixed Income ?? 30.0%

I am now stuck with the Fixed Income asset allocation, as I am not sure how to best build it. The rationale for that would be to act as a buffer when the next equity crash happens. So what is the general consensus in this case? UK or Global? Gilts or Corporate? Short or Long maturity? Active or Passive?
I am struggling to get my head around with the correlation (especially when considering the maturity) between Fixed income and Equity; I guess I would like something to react positively to offset (as much as possible) any negative in the equity sector.
Could you please shed any lights?
Many thanks

Strange allocation - why go only for a developed market managed fund whereas sticking to pure passive for an emerging g markets fund? Surely it should at least be the other way round? Given that developed markets are more efficient then em markets.

bostonerimus

So you now have 45% allocated to just 30 stocks, and small amounts in small cap and Japan and ?? for bonds.

This is worse than your starting point as far as diversification goes. Stop messing about with small allocations to markets that you don't really understand......leave that up to the fund managers and the people who think they understand the markets.