Is my portfolio too risky?

Malthusian

CreditCardChris said:

Yes the US was an emerging economy but it's 2020 and I don't see any other countries leading the way in electric cars, space flight and god knows what other industries will be created in the next 30 years. 

I've never been able to understand why countries outside the US don't do more to support world-beating businesses in industries that don't exist yet.

Prism

Of my three global funds, the best two performers over the last 18 months have a 42% and 36% allocation to the US, compared with the standard 60+%. One of the best performing funds of the last few years is Baillie Gifford Positive Change which has 43% in the US. 
There are lots of investment opportunities around the world, without having to stick all your cash into the US and hope that things continue as they have.

CreditCardChris

Malthusian said:

CreditCardChris said:

Yes the US was an emerging economy but it's 2020 and I don't see any other countries leading the way in electric cars, space flight and god knows what other industries will be created in the next 30 years. 

I've never been able to understand why countries outside the US don't do more to support world-beating businesses in industries that don't exist yet.

There are a few things governments like the UK can do to help us create new technologies. 

1. Reduce all taxes on technology startups to 0%.
2. Maintain this 0% tax for the first 10 years if they remain in the UK and go public on the LSE.
3. Offer bonuses and other incentives to help them expand into international markets while remaining a UK company.

I would suggest the complete banning of selling your company to a foreign company for the first 20 years but this is probably too extreme and may force them to create the companies abroad instead of the UK. 

Username999

If you want exposure to Space Exploration and Electric Vehicles check out Baillie Gifford US Growth Trust (symbol: USA).
It includes Tesla and SpaceX.

Also check out Baillie Gifford Scottish Mortgage Investment Trust (symbol: SMT) which is NOT limited to just the USA, and includes Tesla.

yellow1231231

CreditCardChris said:

Malthusian said:

CreditCardChris said:

Yes the US was an emerging economy but it's 2020 and I don't see any other countries leading the way in electric cars, space flight and god knows what other industries will be created in the next 30 years. 

I've never been able to understand why countries outside the US don't do more to support world-beating businesses in industries that don't exist yet.

There are a few things governments like the UK can do to help us create new technologies. 

1. Reduce all taxes on technology startups to 0%.
2. Maintain this 0% tax for the first 10 years if they remain in the UK and go public on the LSE.
3. Offer bonuses and other incentives to help them expand into international markets while remaining a UK company.

I would suggest the complete banning of selling your company to a foreign company for the first 20 years but this is probably too extreme and may force them to create the companies abroad instead of the UK. 

do you have any idea what you are talking about technology startups dont make profit so dont pay tax as it is 

Sailtheworld

CreditCardChris said:

bowlhead99 said:

CreditCardChris said:

grumiofoundation said:
The feedback you keep being given on this forum is to not only invest in the US (in fact thats the feedback you'd get anywhere). 

 
However you clearly think you know best.

So why are you continuing to ask for 'advice'?

Because I'm interesting in people's arguments as to why my suggestion is wrong. I'm not really looking for "advice" per se as I'd never take advice from an internet forum anyway, I'm more after alternative opinions. 

I have not swapped funds yet and I probably won't but something inside tells me in 30 years when I retire I'm going to be !!!!!! I didn't go all in on the US and instead diversified into lesser economies.

You've started over sixty threads in the last year and a half that you've been on the forum. There are several of those threads in which you propose investing only in the US and that there's no point investing anywhere that isn't the US because the US produces more unicorns etc etc etc, everywhere else is dead as an investment choice. People have given you some opinion and guidance on why that is a shortsighted view.

You say you don't want 'advice', but you have started tens of threads asking basic questions about how things work and asking for peoples opinion on investment related stuff, only to tell us (once people have invested some of their free time into giving you some answers) that you know it all.  And you still want alternative opinions. 

It's probably not surprising that the regulars on the board are still telling you that focusing on one area at the expense of all the others is bad quality investing, having told you that before. If you keep asking the same sort of questions, you will keep getting the same sort of answers. You say that you're after 'alternative opinions', but when given those opinions you dismiss them, because they are alternate or contrary to what you believe yourself to be the right answer, even though you're quite lacking in knowledge and experience.

There is probably only a limited amount of new threads of you saying the same thing that people will tolerate before giving up on the idea of replying to repeat their opinion, so if you are looking to create a thread that only has you in it - and nobody else there to disagree with you - you're going about it the right way.

https://forums.moneysavingexpert.com/discussion/6127529/why-do-people-discourage-investing-only-in-the-us-markets#latest
https://forums.moneysavingexpert.com/discussion/6108853/i-finally-opened-a-stocks-and-shares-isa#latest
etc etc etc

But I have taken the opinions of people onboard and done my own research which is why I went with the global all cap. Now I guess However now I'm having doubts, perhaps to be expected for a first time investor... In any case I still believe it will be something of a miracle to see the rest of the world out perform the US over the next 20 - 30 years but maybe the UK and others will create a few golden eggs of their own along the way to balance it out a little who knows.

  

There's a fairly simple solution for anyone wishing to increase their exposure to a particular country and that's to allocate more capital to it. You're at 60% USA at the moment so you could buy 100% US exposure from here to increase the allocation over time. Or, you could sell up and swap to 100% exposure from tomorrow. Or, if it's exposure to particular parts of the USA find a fund which invests in those sectors.

If you want agreement or some sort of reassurance that this will be the right thing to do you'll be a long time waiting because nobody knows. Maybe we can have a catch up in 2050 to see how it went.

Sometimes you've just got to make a choice and then go and do something more productive than worry about it.

Voyager2002

CreditCardChris said:

Currently I'm investing in the Vanguard Global All Cap Index which is weighted 59.8% America, 17% Europe, 12.5% Pacific, 10.1% Emerging and 0.6% other.

But now I'm thinking this is too risky and I should play it safer and go with the Vanguard S&P500 index fund instead? I feel very uneasy investing in countries which have lagged behind the US for the last 100 years.

The world just isn't capable of keeping up with the US and the US is on the verge of breaking through into the space industries (moon / asteroid mining, space exploration etc). Why should I be risking my money in all these other countries when they're not actually doing anything but stagnating / being bought up by the US?

Your post shows a fundamental misunderstanding of risk and how to manage it.

You reduce risk through diversification, by investing in a range of asset classes rather than only equities, and by investing in companies across the entire world. Obviously this means sacrificing returns. At the other extreme, if you know that a particular Unicorn is sure to be the next Apple, you invest exclusively in it and if you are right you become fabulously wealthy. Most people will do something in between these two extremes.

Another factor that you miss out is price levels. Suppose that you are right, and that the bulk of the world's economic growth over the next decade will be captured by US companies. However, perhaps US shares are already priced to include this, meaning that if you buy now there will be minimal scope for growth. Conversely, companies in other parts of the world might now be so cheap that their share prices could increase dramatically before you need to sell them.

BananaRepublic

CreditCardChris said:

Currently I'm investing in the Vanguard Global All Cap Index which is weighted 59.8% America, 17% Europe, 12.5% Pacific, 10.1% Emerging and 0.6% other.

But now I'm thinking this is too risky and I should play it safer and go with the Vanguard S&P500 index fund instead? I feel very uneasy investing in countries which have lagged behind the US for the last 100 years.

The world just isn't capable of keeping up with the US and the US is on the verge of breaking through into the space industries (moon / asteroid mining, space exploration etc). Why should I be risking my money in all these other countries when they're not actually doing anything but stagnating / being bought up by the US?

Investing is about maximising potential gains subject to the amount of risk you are prepared to accept, whilst minimising that risk as far as possible. One key way to reduce risk is to diversify. Or to put it in simple terms, don’t put all of your eggs in one basket. 

NedS

CreditCardChris said:

But now I'm thinking this is too risky and I should play it safer and go with the Vanguard S&P500 index fund instead? I feel very uneasy investing in countries which have lagged behind the US for the last 100 years.

Absolutely agree with what everyone else has said about diversification and staying global. To that, I'd add:

About a year ago I thought America looked overvalued and found it difficult to justify the valuations based on earnings. Earnings growth was (relatively) poor and yet the market rose still further making it even more overvalued (IMHO). Then Covid-19 hit. Since then, the market is pretty much back where it was and earnings have plummeted. Of course the market can remain irrational longer than you can remain solvent, but I would say now is not looking like the best entry point into the S&P500. Markets will revert to the mean eventually and future growth will be driven by earnings.