Lindsell Train Global Equity

itwasntme001

Sailtheworld said:

itwasntme001 said:

I keep hearing that young people should be invested close to 100% equities.  I am in my 30s and I am reducing my risk.  Never was 100% equities.  At a cost of lost opportunity, I sleep well at night.  I am looking to reduce risk from 60-70% equities down to 50% equities.  Almost all remaining investments in active funds.

This year has been a gift for people who really want to consider portfolio allocation.  Use this time wisely.

When you're, say, 30 you're already taking a lower risk. You've got decades of earnings ahead and the timeframe to ride out numerous negative events and still come out on top. Choosing 50% equities is choosing lower returns i.e. expensive sleep.

I completely agree.  But I see things slightly differently.  Whilst risk generally comes with reward, it by no means is guaranteed even in the longer term.  IMO I rather place my capital in assets with better risk reward and at this stage, public equities like tracker funds do not offer this.

Sailtheworld

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

I keep hearing that young people should be invested close to 100% equities.  I am in my 30s and I am reducing my risk.  Never was 100% equities.  At a cost of lost opportunity, I sleep well at night.  I am looking to reduce risk from 60-70% equities down to 50% equities.  Almost all remaining investments in active funds.

This year has been a gift for people who really want to consider portfolio allocation.  Use this time wisely.

When you're, say, 30 you're already taking a lower risk. You've got decades of earnings ahead and the timeframe to ride out numerous negative events and still come out on top. Choosing 50% equities is choosing lower returns i.e. expensive sleep.

I completely agree.  But I see things slightly differently.  Whilst risk generally comes with reward, it by no means is guaranteed even in the longer term.  IMO I rather place my capital in assets with better risk reward and at this stage, public equities like tracker funds do not offer this.

The difference is you're claiming an investment edge because you're saying you can identify which assets have the best risk to reward ratio. Nothing wrong with that of course but you're going to be talking at slightly cross purposes with those that don't  - they have to use the rather blunt instrument of equity % to adjust risk.

Of course you sleep well.

Thrugelmir

itwasntme001 said:

I keep hearing that young people should be invested close to 100% equities.  

Equities take many forms. A PLC can take many forms in terms of it's activity, trade, income stream etc. As a consequence it's possible to diversify and spread ones exposure.  Reducing volatility in the process. 

itwasntme001

Thrugelmir said:

itwasntme001 said:

I keep hearing that young people should be invested close to 100% equities.  

Equities take many forms. A PLC can take many forms in terms of it's activity, trade, income stream etc. As a consequence it's possible to diversify and spread ones exposure.  Reducing volatility in the process. 

The discussion was in context of a market cap weighted global equity fund.

Of course being 100% invested in capital gearing trust as an example is technically 100% "equities" but not nearly as much risk as a 100% global equity passive tracker.

itwasntme001

Sailtheworld said:

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

I keep hearing that young people should be invested close to 100% equities.  I am in my 30s and I am reducing my risk.  Never was 100% equities.  At a cost of lost opportunity, I sleep well at night.  I am looking to reduce risk from 60-70% equities down to 50% equities.  Almost all remaining investments in active funds.

This year has been a gift for people who really want to consider portfolio allocation.  Use this time wisely.

When you're, say, 30 you're already taking a lower risk. You've got decades of earnings ahead and the timeframe to ride out numerous negative events and still come out on top. Choosing 50% equities is choosing lower returns i.e. expensive sleep.

I completely agree.  But I see things slightly differently.  Whilst risk generally comes with reward, it by no means is guaranteed even in the longer term.  IMO I rather place my capital in assets with better risk reward and at this stage, public equities like tracker funds do not offer this.

The difference is you're claiming an investment edge because you're saying you can identify which assets have the best risk to reward ratio. Nothing wrong with that of course but you're going to be talking at slightly cross purposes with those that don't  - they have to use the rather blunt instrument of equity % to adjust risk.

Of course you sleep well.

Not claiming to have an edge in anything.  All the information I have read is available to the general public.  Future expected returns are going to be low at these levels.  Merely saying the risk reward is not there and its more optimal to invest in other assets.  Crucially diversification matters more so then ever before.

Sailtheworld

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

I keep hearing that young people should be invested close to 100% equities.  I am in my 30s and I am reducing my risk.  Never was 100% equities.  At a cost of lost opportunity, I sleep well at night.  I am looking to reduce risk from 60-70% equities down to 50% equities.  Almost all remaining investments in active funds.

This year has been a gift for people who really want to consider portfolio allocation.  Use this time wisely.

When you're, say, 30 you're already taking a lower risk. You've got decades of earnings ahead and the timeframe to ride out numerous negative events and still come out on top. Choosing 50% equities is choosing lower returns i.e. expensive sleep.

I completely agree.  But I see things slightly differently.  Whilst risk generally comes with reward, it by no means is guaranteed even in the longer term.  IMO I rather place my capital in assets with better risk reward and at this stage, public equities like tracker funds do not offer this.

The difference is you're claiming an investment edge because you're saying you can identify which assets have the best risk to reward ratio. Nothing wrong with that of course but you're going to be talking at slightly cross purposes with those that don't  - they have to use the rather blunt instrument of equity % to adjust risk.

Of course you sleep well.

Not claiming to have an edge in anything.  All the information I have read is available to the general public.  Future expected returns are going to be low at these levels.  Merely saying the risk reward is not there and its more optimal to invest in other assets.  Crucially diversification matters more so then ever before.

Knowing that equity returns from the FTSE All World Index will be 0% for a decade is a huge advantage. I think it hit a record high today so the other market participants have a different view.

Crucially you're not diversifying (why would you?) but concentrating non-equity risks.

itwasntme001

Sailtheworld said:

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

I keep hearing that young people should be invested close to 100% equities.  I am in my 30s and I am reducing my risk.  Never was 100% equities.  At a cost of lost opportunity, I sleep well at night.  I am looking to reduce risk from 60-70% equities down to 50% equities.  Almost all remaining investments in active funds.

This year has been a gift for people who really want to consider portfolio allocation.  Use this time wisely.

When you're, say, 30 you're already taking a lower risk. You've got decades of earnings ahead and the timeframe to ride out numerous negative events and still come out on top. Choosing 50% equities is choosing lower returns i.e. expensive sleep.

I completely agree.  But I see things slightly differently.  Whilst risk generally comes with reward, it by no means is guaranteed even in the longer term.  IMO I rather place my capital in assets with better risk reward and at this stage, public equities like tracker funds do not offer this.

The difference is you're claiming an investment edge because you're saying you can identify which assets have the best risk to reward ratio. Nothing wrong with that of course but you're going to be talking at slightly cross purposes with those that don't  - they have to use the rather blunt instrument of equity % to adjust risk.

Of course you sleep well.

Not claiming to have an edge in anything.  All the information I have read is available to the general public.  Future expected returns are going to be low at these levels.  Merely saying the risk reward is not there and its more optimal to invest in other assets.  Crucially diversification matters more so then ever before.

Knowing that equity returns from the FTSE All World Index will be 0% for a decade is a huge advantage. I think it hit a record high today so the other market participants have a different view.

Crucially you're not diversifying (why would you?) but concentrating non-equity risks.

I don't know anything for certain about equity markets.  What I do know is that low real returns should be expected.  0% REAL returns, not nominal.

Saying that market participants are always right and that I am wrong because they decided to price markets "at a high" today, is similar to what a technical analyst or chartist would say.  Completely voodoo analysis.

Equities are a risky asset class and should be treated as such.  They do not owe you anything whether you hold for 1 year or 10 years.  IMO 100% or even 75% equities at current valuations for a global market weight fund is being overly aggressive.

When the share of GDP/profits shifts away from capital and towards labour, you will see what I mean.

Sailtheworld

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

I keep hearing that young people should be invested close to 100% equities.  I am in my 30s and I am reducing my risk.  Never was 100% equities.  At a cost of lost opportunity, I sleep well at night.  I am looking to reduce risk from 60-70% equities down to 50% equities.  Almost all remaining investments in active funds.

This year has been a gift for people who really want to consider portfolio allocation.  Use this time wisely.

When you're, say, 30 you're already taking a lower risk. You've got decades of earnings ahead and the timeframe to ride out numerous negative events and still come out on top. Choosing 50% equities is choosing lower returns i.e. expensive sleep.

I completely agree.  But I see things slightly differently.  Whilst risk generally comes with reward, it by no means is guaranteed even in the longer term.  IMO I rather place my capital in assets with better risk reward and at this stage, public equities like tracker funds do not offer this.

The difference is you're claiming an investment edge because you're saying you can identify which assets have the best risk to reward ratio. Nothing wrong with that of course but you're going to be talking at slightly cross purposes with those that don't  - they have to use the rather blunt instrument of equity % to adjust risk.

Of course you sleep well.

Not claiming to have an edge in anything.  All the information I have read is available to the general public.  Future expected returns are going to be low at these levels.  Merely saying the risk reward is not there and its more optimal to invest in other assets.  Crucially diversification matters more so then ever before.

Knowing that equity returns from the FTSE All World Index will be 0% for a decade is a huge advantage. I think it hit a record high today so the other market participants have a different view.

Crucially you're not diversifying (why would you?) but concentrating non-equity risks.

I don't know anything for certain about equity markets.  What I do know is that low real returns should be expected.  0% REAL returns, not nominal.

Saying that market participants are always right and that I am wrong because they decided to price markets "at a high" today, is similar to what a technical analyst or chartist would say.  Completely voodoo analysis.

Equities are a risky asset class and should be treated as such.  They do not owe you anything whether you hold for 1 year or 10 years.  IMO 100% or even 75% equities at current valuations for a global market weight fund is being overly aggressive.

When the share of GDP/profits shifts away from capital and towards labour, you will see what I mean.

You're saying the other participants are wrong so you're taking a position from which you'll profit when they come around to your way of thinking.

I'm not saying you're wrong. I'm just surprised you don't see this as declaring an edge.

itwasntme001

Sailtheworld said:

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

I keep hearing that young people should be invested close to 100% equities.  I am in my 30s and I am reducing my risk.  Never was 100% equities.  At a cost of lost opportunity, I sleep well at night.  I am looking to reduce risk from 60-70% equities down to 50% equities.  Almost all remaining investments in active funds.

This year has been a gift for people who really want to consider portfolio allocation.  Use this time wisely.

When you're, say, 30 you're already taking a lower risk. You've got decades of earnings ahead and the timeframe to ride out numerous negative events and still come out on top. Choosing 50% equities is choosing lower returns i.e. expensive sleep.

I completely agree.  But I see things slightly differently.  Whilst risk generally comes with reward, it by no means is guaranteed even in the longer term.  IMO I rather place my capital in assets with better risk reward and at this stage, public equities like tracker funds do not offer this.

The difference is you're claiming an investment edge because you're saying you can identify which assets have the best risk to reward ratio. Nothing wrong with that of course but you're going to be talking at slightly cross purposes with those that don't  - they have to use the rather blunt instrument of equity % to adjust risk.

Of course you sleep well.

Not claiming to have an edge in anything.  All the information I have read is available to the general public.  Future expected returns are going to be low at these levels.  Merely saying the risk reward is not there and its more optimal to invest in other assets.  Crucially diversification matters more so then ever before.

Knowing that equity returns from the FTSE All World Index will be 0% for a decade is a huge advantage. I think it hit a record high today so the other market participants have a different view.

Crucially you're not diversifying (why would you?) but concentrating non-equity risks.

I don't know anything for certain about equity markets.  What I do know is that low real returns should be expected.  0% REAL returns, not nominal.

Saying that market participants are always right and that I am wrong because they decided to price markets "at a high" today, is similar to what a technical analyst or chartist would say.  Completely voodoo analysis.

Equities are a risky asset class and should be treated as such.  They do not owe you anything whether you hold for 1 year or 10 years.  IMO 100% or even 75% equities at current valuations for a global market weight fund is being overly aggressive.

When the share of GDP/profits shifts away from capital and towards labour, you will see what I mean.

You're saying the other participants are wrong so you're taking a position from which you'll profit when they come around to your way of thinking.

I'm not saying you're wrong. I'm just surprised you don't see this as declaring an edge.

I'm not saying anyone is wrong.  The market price is the market price.  It is up to individuals to allocate capital as suitable to them.  Would you think that market participants were right (whatever that is meant to mean) at the dot-com peak and so an investor back then should just hold into a bubble?

Prism

Sailtheworld said:

itwasntme001 said:

Sailtheworld said:

itwasntme001 said:

I keep hearing that young people should be invested close to 100% equities.  I am in my 30s and I am reducing my risk.  Never was 100% equities.  At a cost of lost opportunity, I sleep well at night.  I am looking to reduce risk from 60-70% equities down to 50% equities.  Almost all remaining investments in active funds.

This year has been a gift for people who really want to consider portfolio allocation.  Use this time wisely.

When you're, say, 30 you're already taking a lower risk. You've got decades of earnings ahead and the timeframe to ride out numerous negative events and still come out on top. Choosing 50% equities is choosing lower returns i.e. expensive sleep.

I completely agree.  But I see things slightly differently.  Whilst risk generally comes with reward, it by no means is guaranteed even in the longer term.  IMO I rather place my capital in assets with better risk reward and at this stage, public equities like tracker funds do not offer this.

The difference is you're claiming an investment edge because you're saying you can identify which assets have the best risk to reward ratio. Nothing wrong with that of course but you're going to be talking at slightly cross purposes with those that don't  - they have to use the rather blunt instrument of equity % to adjust risk.

Of course you sleep well.

There are alternate rebalancing models beyond a fixed % equity/bond split, which don't try and predict future returns or consider valuations. Moving the allocations around are not always about having an edge.

Not sure if itwasntme001 is following one or just going off gut feeling.