So, where this is going?

sebtomato

bostonerimus said:

These questions are meaningless. Set your allocation, invest regularly and let time do the work for you rather than worrying about short term market volatility.

So what's the allocation should be then? More towards the UK if there is still room to recover from all time high? More towards the US, if you think companies are not over valued?
I have been investing for 20 years, but it doesn't mean I can't reassess my allocation from time to time. 

AnotherJoe

sebtomato said:

bostonerimus said:

These questions are meaningless. Set your allocation, invest regularly and let time do the work for you rather than worrying about short term market volatility.

So what's the allocation should be then? More towards the UK if there is still room to recover from all time high? More towards the US, if you think companies are not over valued?
I have been investing for 20 years, but it doesn't mean I can't reassess my allocation from time to time. 

Serious question. How would you invest in the UK?

Thrugelmir

The FTSE All Share has outperformed the S&P 500 since the beginning of the year. Often markets have moved before you've realised it.  

eskbanker

sebtomato said:

I have been investing for 20 years

So what's your reaction been at all the other times markets have been high over that period, and why would it be different this time?  What are you invested in and what do you believe is a more appropriate allocation, and why?

bostonerimus

sebtomato said:

bostonerimus said:

These questions are meaningless. Set your allocation, invest regularly and let time do the work for you rather than worrying about short term market volatility.

So what's the allocation should be then? More towards the UK if there is still room to recover from all time high? More towards the US, if you think companies are not over valued?
I have been investing for 20 years, but it doesn't mean I can't reassess my allocation from time to time. 

You need to answer those questions, if you are approaching retirement you might look at some inflation linked bonds, but make strategic changes, not the tactical ones you seem to be worried about.
I'm retired in the US and have an 80/20, equity/bonds split, because I have a DB pension and rental income and can stay aggressive. My equity split is 70/30, US/Global ex-US. I also keep a couple of years spending in cash for emergencies

sebtomato

eskbanker said:

sebtomato said:

I have been investing for 20 years

So what's your reaction been at all the other times markets have been high over that period, and why would it be different this time?  What are you invested in and what do you believe is a more appropriate allocation, and why?

My reaction is the same as before. I am investing for the long term. However, doesn't mean I don't want to optimise my portfolio, at least in term of allocation. Allocation of assets, particularly between stock markets, is highly subjective (no exact science there), so I was hoping people would be able to contribute with data/facts, particularly on US/UK/EU markets.
Through various funds, like VLS, my portfolio is quite UK-focussed. Looking at the FTSE100, it would seem to be a good thing, as there is still some mileage to get to the previous highs.
However, I also have a large allocation in US trackers, and looking more closely, at a handful of tech companies that might be well overvalued, so not sure if there is much more mileage there. 

Prism

sebtomato said:

eskbanker said:

sebtomato said:

I have been investing for 20 years

So what's your reaction been at all the other times markets have been high over that period, and why would it be different this time?  What are you invested in and what do you believe is a more appropriate allocation, and why?

My reaction is the same as before. I am investing for the long term. However, doesn't mean I don't want to optimise my portfolio, at least in term of allocation. Allocation of assets, particularly between stock markets, is highly subjective (no exact science there), so I was hoping people would be able to contribute with data/facts, particularly on US/UK/EU markets.
Through various funds, like VLS, my portfolio is quite UK-focussed. Looking at the FTSE100, it would seem to be a good thing, as there is still some mileage to get to the previous highs.
However, I also have a large allocation in US trackers, and looking more closely, at a handful of tech companies that might be well overvalued, so not sure if there is much more mileage there. 

As you say its all subjective but you could use this table of CAPE ratios as a start.

CAPE Ratios by Country 2021 (Shiller PE) | Siblis Research

The trouble is as always is that it only looks backwards and therefore even though the UK looks cheap (even cheaper than in 2018) it doesn't tell us if that valuation is deserved or not.
Personally I have not added anything to US equities for a few years and all of my recent contributions have gone into UK and emerging markets funds, but that is more to keep the allocation in balance rather than any major thoughts on the future.

bostonerimus

Prism said:

sebtomato said:

eskbanker said:

sebtomato said:

I have been investing for 20 years

So what's your reaction been at all the other times markets have been high over that period, and why would it be different this time?  What are you invested in and what do you believe is a more appropriate allocation, and why?

My reaction is the same as before. I am investing for the long term. However, doesn't mean I don't want to optimise my portfolio, at least in term of allocation. Allocation of assets, particularly between stock markets, is highly subjective (no exact science there), so I was hoping people would be able to contribute with data/facts, particularly on US/UK/EU markets.
Through various funds, like VLS, my portfolio is quite UK-focussed. Looking at the FTSE100, it would seem to be a good thing, as there is still some mileage to get to the previous highs.
However, I also have a large allocation in US trackers, and looking more closely, at a handful of tech companies that might be well overvalued, so not sure if there is much more mileage there. 

As you say its all subjective but you could use this table of CAPE ratios as a start.

CAPE Ratios by Country 2021 (Shiller PE) | Siblis Research

The trouble is as always is that it only looks backwards and therefore even though the UK looks cheap (even cheaper than in 2018) it doesn't tell us if that valuation is deserved or not.
Personally I have not added anything to US equities for a few years and all of my recent contributions have gone into UK and emerging markets funds, but that is more to keep the allocation in balance rather than any major thoughts on the future.

My last purchase was a Global ex-US tracker as my US allocation had got a bit out of whack with the recent run up. I'll continue to buy that Global ex-US tracker when I have some spare cash so that I approach 60% US equities.

bluefukurou

Thrugelmir said:

The FTSE All Share has outperformed the S&P 500 since the beginning of the year. Often markets have moved before you've realised it.  

It's become fashionable to say this, but it isn't true.

Prism

bluefukurou said:

Thrugelmir said:

The FTSE All Share has outperformed the S&P 500 since the beginning of the year. Often markets have moved before you've realised it.  

It's become fashionable to say this, but it isn't true.

Indices are not an ideal way to make comparisons as they ignore dividends and are often priced in different currencies. Not much point in a 5% gain in an index if the currency it is held in has devalued 5%.
So from the point of view of lets say a UK investor they would have been better off this year from a FTSE 100 tracker (10.3%) than an S&P 500 tracker (8.9%).
For a US investor it would pretty much be the same results with the US based EWU ETF being up nearly 17% YTD.