Portfolio advice

Hoenir

coyrls said:

Hoenir said:

Linton said:

chiang_mai said:

Linton said:

chiang_mai said:

Linton said:

nick1234 said:

Linton said:

I am confused.  You talk about a large amount in FTSE AllShare and S&P 500 trackers   but your "current portfolio" shows neither.

In my view...

Your current portfolio is far more complex than it needs to be.  Investing significant amounts in say Vietnam or Turkey seems eccentric and investing small amounts pointless given you are also holding general trackers.

In my portfolio I have a general policy that holdings of less than 5% are not worth the management effort.  That would also rule out individual stocks.  You can cover the whole world in say 10 or fewer well chosen funds with sufficient flexibility to make your own choice of allocations to major country and company size. 

5-20 years is not long term.  5 years is short term, 10years medium term and 15-20 or more is long term. If you may be selling significant capital in 5 years time it would be sensible to derisk it now.

Why invest in something else - why not just put more into the investments you all ready hold?

Thanks you are right i assumed 50% being in an all world tracker being a large percentage of the developed world and thus US.   Do you think something like TDGB or VHYL which is global but less US heavy would be a good hedge as it doesnt hold the large tech firms?  

Otherwise i will add to FWRG - all world.  I realise the portfolio has become slightly complex but its just due to stocks i have historically bought and have all gone 100%+ much more than my ETF’s.  I am slowly selling down these and the single country ETF’s

My time horizon is longer i don’t need this cash for at least 10 years or longer based on current situation

The US is about 65% of a typical global tracker.  But if the tracker is only 50% of your portfolio that puts yuour US at 32% which is unusually low.  I aim for 40% US though currently its down to about 36%.

I suggest these are unusual times. I have reduced my US equities holdings from 50%, down to 25%, which is 15% of my total portfolio, on par with my EU holdings. Even experienced professionals appear to be struggling with asset allocation at present it must be nightmarish for a beginner. 

I believe asset allocation is for the long term and one should not adjust it to deal with short term events.  Cutting US now is buying high and selling low which is not a recommended strategy.

Investing rules change with age and I think this might be one of them, What you say makes complete sense when there is still decades  left to run on the investing time horizon, but less so for investors aged over, say 70 years. The ratio of equites in a portfolio is meant to reduce with age, I think that the usefulness of index trackers also reduces. Simply put, if there is no time for recovery, the advantages of these things is minimised,  The case for maintaining a stable asset allocation, throughout an extended geopolitical downturn, just for the sake of it, fits into this same classification....I think.

 If Trump is causing you palpitations then you were poorly invested in the first place.

The UK media gave scant coverage to what Trump said during his pre-election campaign.

Really????

Between July 2024 and February 2025 the SP500 rose around 9% in $ terms. No one expected what the Trump Administration has subsequently unleashed. 

Hoenir

Linton said:

Hoenir said:

Linton said:

chiang_mai said:

Linton said:

chiang_mai said:

Linton said:

nick1234 said:

Linton said:

I am confused.  You talk about a large amount in FTSE AllShare and S&P 500 trackers   but your "current portfolio" shows neither.

In my view...

Your current portfolio is far more complex than it needs to be.  Investing significant amounts in say Vietnam or Turkey seems eccentric and investing small amounts pointless given you are also holding general trackers.

In my portfolio I have a general policy that holdings of less than 5% are not worth the management effort.  That would also rule out individual stocks.  You can cover the whole world in say 10 or fewer well chosen funds with sufficient flexibility to make your own choice of allocations to major country and company size. 

5-20 years is not long term.  5 years is short term, 10years medium term and 15-20 or more is long term. If you may be selling significant capital in 5 years time it would be sensible to derisk it now.

Why invest in something else - why not just put more into the investments you all ready hold?

Thanks you are right i assumed 50% being in an all world tracker being a large percentage of the developed world and thus US.   Do you think something like TDGB or VHYL which is global but less US heavy would be a good hedge as it doesnt hold the large tech firms?  

Otherwise i will add to FWRG - all world.  I realise the portfolio has become slightly complex but its just due to stocks i have historically bought and have all gone 100%+ much more than my ETF’s.  I am slowly selling down these and the single country ETF’s

My time horizon is longer i don’t need this cash for at least 10 years or longer based on current situation

The US is about 65% of a typical global tracker.  But if the tracker is only 50% of your portfolio that puts yuour US at 32% which is unusually low.  I aim for 40% US though currently its down to about 36%.

I suggest these are unusual times. I have reduced my US equities holdings from 50%, down to 25%, which is 15% of my total portfolio, on par with my EU holdings. Even experienced professionals appear to be struggling with asset allocation at present it must be nightmarish for a beginner. 

I believe asset allocation is for the long term and one should not adjust it to deal with short term events.  Cutting US now is buying high and selling low which is not a recommended strategy.

Investing rules change with age and I think this might be one of them, What you say makes complete sense when there is still decades  left to run on the investing time horizon, but less so for investors aged over, say 70 years. The ratio of equites in a portfolio is meant to reduce with age, I think that the usefulness of index trackers also reduces. Simply put, if there is no time for recovery, the advantages of these things is minimised,  The case for maintaining a stable asset allocation, throughout an extended geopolitical downturn, just for the sake of it, fits into this same classification....I think.

 If Trump is causing you palpitations then you were poorly invested in the first place.

Don't recall any warnings on this board last year. The UK media gave scant coverage to what Trump said during his pre-election campaign. Even those in the US that pre-empted the Tariff rhetoric have been caught totally off guard.  There's going to be plenty of shocks and surprises a plenty as the reality dawns. Suspect that the complancencey will in time evapourate. 

You didn't need to predict Trump, you should  merely be very aware that unexpected major events can occur and structure your investments accordingly.  It is unwise to assume they wont.

Trump's actions ultimately will impact global trade. This isn't just about the US in isolation. Throw a pebble in the centre of a pond. Ripples extend far and wide. 

coyrls

Hoenir said:

coyrls said:

Hoenir said:

Linton said:

chiang_mai said:

Linton said:

chiang_mai said:

Linton said:

nick1234 said:

Linton said:

I am confused.  You talk about a large amount in FTSE AllShare and S&P 500 trackers   but your "current portfolio" shows neither.

In my view...

Your current portfolio is far more complex than it needs to be.  Investing significant amounts in say Vietnam or Turkey seems eccentric and investing small amounts pointless given you are also holding general trackers.

In my portfolio I have a general policy that holdings of less than 5% are not worth the management effort.  That would also rule out individual stocks.  You can cover the whole world in say 10 or fewer well chosen funds with sufficient flexibility to make your own choice of allocations to major country and company size. 

5-20 years is not long term.  5 years is short term, 10years medium term and 15-20 or more is long term. If you may be selling significant capital in 5 years time it would be sensible to derisk it now.

Why invest in something else - why not just put more into the investments you all ready hold?

Thanks you are right i assumed 50% being in an all world tracker being a large percentage of the developed world and thus US.   Do you think something like TDGB or VHYL which is global but less US heavy would be a good hedge as it doesnt hold the large tech firms?  

Otherwise i will add to FWRG - all world.  I realise the portfolio has become slightly complex but its just due to stocks i have historically bought and have all gone 100%+ much more than my ETF’s.  I am slowly selling down these and the single country ETF’s

My time horizon is longer i don’t need this cash for at least 10 years or longer based on current situation

The US is about 65% of a typical global tracker.  But if the tracker is only 50% of your portfolio that puts yuour US at 32% which is unusually low.  I aim for 40% US though currently its down to about 36%.

I suggest these are unusual times. I have reduced my US equities holdings from 50%, down to 25%, which is 15% of my total portfolio, on par with my EU holdings. Even experienced professionals appear to be struggling with asset allocation at present it must be nightmarish for a beginner. 

I believe asset allocation is for the long term and one should not adjust it to deal with short term events.  Cutting US now is buying high and selling low which is not a recommended strategy.

Investing rules change with age and I think this might be one of them, What you say makes complete sense when there is still decades  left to run on the investing time horizon, but less so for investors aged over, say 70 years. The ratio of equites in a portfolio is meant to reduce with age, I think that the usefulness of index trackers also reduces. Simply put, if there is no time for recovery, the advantages of these things is minimised,  The case for maintaining a stable asset allocation, throughout an extended geopolitical downturn, just for the sake of it, fits into this same classification....I think.

 If Trump is causing you palpitations then you were poorly invested in the first place.

The UK media gave scant coverage to what Trump said during his pre-election campaign.

Really????

Between July 2024 and February 2025 the SP500 rose around 9% in $ terms. No one expected what the Trump Administration has subsequently unleashed. 

My point was about UK media coverage of Trump's pre-election campaign, which you said was "scant", I remember it being extensive.

Linton

Hoenir said:

Linton said:

Hoenir said:

Linton said:

chiang_mai said:

Linton said:

chiang_mai said:

Linton said:

nick1234 said:

Linton said:

I am confused.  You talk about a large amount in FTSE AllShare and S&P 500 trackers   but your "current portfolio" shows neither.

In my view...

Your current portfolio is far more complex than it needs to be.  Investing significant amounts in say Vietnam or Turkey seems eccentric and investing small amounts pointless given you are also holding general trackers.

In my portfolio I have a general policy that holdings of less than 5% are not worth the management effort.  That would also rule out individual stocks.  You can cover the whole world in say 10 or fewer well chosen funds with sufficient flexibility to make your own choice of allocations to major country and company size. 

5-20 years is not long term.  5 years is short term, 10years medium term and 15-20 or more is long term. If you may be selling significant capital in 5 years time it would be sensible to derisk it now.

Why invest in something else - why not just put more into the investments you all ready hold?

Thanks you are right i assumed 50% being in an all world tracker being a large percentage of the developed world and thus US.   Do you think something like TDGB or VHYL which is global but less US heavy would be a good hedge as it doesnt hold the large tech firms?  

Otherwise i will add to FWRG - all world.  I realise the portfolio has become slightly complex but its just due to stocks i have historically bought and have all gone 100%+ much more than my ETF’s.  I am slowly selling down these and the single country ETF’s

My time horizon is longer i don’t need this cash for at least 10 years or longer based on current situation

The US is about 65% of a typical global tracker.  But if the tracker is only 50% of your portfolio that puts yuour US at 32% which is unusually low.  I aim for 40% US though currently its down to about 36%.

I suggest these are unusual times. I have reduced my US equities holdings from 50%, down to 25%, which is 15% of my total portfolio, on par with my EU holdings. Even experienced professionals appear to be struggling with asset allocation at present it must be nightmarish for a beginner. 

I believe asset allocation is for the long term and one should not adjust it to deal with short term events.  Cutting US now is buying high and selling low which is not a recommended strategy.

Investing rules change with age and I think this might be one of them, What you say makes complete sense when there is still decades  left to run on the investing time horizon, but less so for investors aged over, say 70 years. The ratio of equites in a portfolio is meant to reduce with age, I think that the usefulness of index trackers also reduces. Simply put, if there is no time for recovery, the advantages of these things is minimised,  The case for maintaining a stable asset allocation, throughout an extended geopolitical downturn, just for the sake of it, fits into this same classification....I think.

 If Trump is causing you palpitations then you were poorly invested in the first place.

Don't recall any warnings on this board last year. The UK media gave scant coverage to what Trump said during his pre-election campaign. Even those in the US that pre-empted the Tariff rhetoric have been caught totally off guard.  There's going to be plenty of shocks and surprises a plenty as the reality dawns. Suspect that the complancencey will in time evapourate. 

You didn't need to predict Trump, you should  merely be very aware that unexpected major events can occur and structure your investments accordingly.  It is unwise to assume they wont.

Trump's actions ultimately will impact global trade. This isn't just about the US in isolation. Throw a pebble in the centre of a pond. Ripples extend far and wide. 

Indeed. I see it as just one further step in the US ceasing to be the predominant power in the global market. But it requires a measured long term strategic approach from investors, not panic selling because of the current short term chaos.. Last year, pre Trump tariffs, I started to increase my China holdings and expect to increase them again in a year or two's time if I can find suitable methods of doing so.

chiang_mai

Linton said:

i dont think age changes the rules of investing.  It may change the overall asset allocations as your future needs change, but at whatever age you are (and I am sadly well over 70), modifying your allocations in response to short term events is unlikely to be beneficial overall.  If Trump is causing you palpitations then you were poorly invested in the first place.

There is no "meant to" about decreasing equity with age.  There may be a need to but that is a different matter. Though in our case the success of the short/medium term strategy has made any change to the long term allocations unnecessary.  

I currently hold 60% in equities, down from 80%+ a few years ago. A rule of thumb I see repeated often is to subtract your age from 100, which, in the absence of anything less complex, is a reasonable loose guide or starting point for novice investors like myself to consider. Other approximate guides use different figures but they're all geared towards the same end, reducing the risk of loss, the closer you get to retirement or needing the funds. So when I say that older people are "meant" to reduce risk, as they age, this is what I refer to.

Other approximate guides that exist suggest the US investment market represents 42% of the global market hence global trackers often contain between 50% and 70% allocation to US equities. I think many people look at these things and in the spirit of not trying to beat the market, emulate those allocations in their own portfolio's.....I know I certainly did for a while. Today I'm holding a 15% (of 100%) US  equities allocation, much more nearly equal to the other global sectors that I hold, some of which are overweight as a result. That will continue as long as the US political landscape remains the same but could easily adjust upwards significantly, if things change for the better. Is that timing the market?  Perhaps, I prefer to think of it in terms of tactical risk avoidance.  

Lastly, all the major investment banks publish their asset allocation schedules for the coming quarter, along with their rationale for change in any sector. I particularly like the JPM allocation report. It's very clear from reading those reports that professional investors and investment banks, adjust their asset allocations, based on current events and their perception of future events, if they can make those adjustments, shouldn't less experienced investors do the same.  

GeoffTF

chiang_mai said:

Lastly, all the major investment banks publish their asset allocation schedules for the coming quarter, along with their rationale for change in any sector. I particularly like the JPM allocation report. It's very clear from reading those reports that professional investors and investment banks, adjust their asset allocations, based on current events and their perception of future events, if they can make those adjustments, shouldn't less experienced investors do the same.

They can, but, on average, they fail to beat the market before costs. Some will beat the market, but you have no way of knowing which ones will do so in advance. Why do you believe that you can do better?

chiang_mai

GeoffTF said:

chiang_mai said:

Lastly, all the major investment banks publish their asset allocation schedules for the coming quarter, along with their rationale for change in any sector. I particularly like the JPM allocation report. It's very clear from reading those reports that professional investors and investment banks, adjust their asset allocations, based on current events and their perception of future events, if they can make those adjustments, shouldn't less experienced investors do the same.

They can, but, on average, they fail to beat the market before costs. Some will beat the market, but you have no way of knowing which ones will do so in advance. Why do you believe that you can do better?

In case I wasn't clear in  my explanation, I was merely suggesting that investors should adjust their asset allocations, in response to known extraordinary events, such as the one taking place currently across the pond.....no more than that. Once again, it's tactical risk reduction.

GeoffTF

chiang_mai said:

GeoffTF said:

chiang_mai said:

Lastly, all the major investment banks publish their asset allocation schedules for the coming quarter, along with their rationale for change in any sector. I particularly like the JPM allocation report. It's very clear from reading those reports that professional investors and investment banks, adjust their asset allocations, based on current events and their perception of future events, if they can make those adjustments, shouldn't less experienced investors do the same.

They can, but, on average, they fail to beat the market before costs. Some will beat the market, but you have no way of knowing which ones will do so in advance. Why do you believe that you can do better?

In case I wasn't clear in  my explanation, I was merely suggesting that investors should adjust their asset allocations, in response to known extraordinary events, such as the one taking place currently across the pond.....no more than that. Once again, it's tactical risk reduction.

If tactical risk reduction worked, active fund managers would use it to beat the market in risk adjusted terms. They clearly cannot do that with any more than a chance rate of success. What skill do you have that they lack?

InvesterJones

chiang_mai said:

GeoffTF said:

chiang_mai said:

Lastly, all the major investment banks publish their asset allocation schedules for the coming quarter, along with their rationale for change in any sector. I particularly like the JPM allocation report. It's very clear from reading those reports that professional investors and investment banks, adjust their asset allocations, based on current events and their perception of future events, if they can make those adjustments, shouldn't less experienced investors do the same.

They can, but, on average, they fail to beat the market before costs. Some will beat the market, but you have no way of knowing which ones will do so in advance. Why do you believe that you can do better?

In case I wasn't clear in  my explanation, I was merely suggesting that investors should adjust their asset allocations, in response to known extraordinary events, such as the one taking place currently across the pond.....no more than that. Once again, it's tactical risk reduction.

I think a better way of thinking about it is investors should adjust their portfolio risk as and when they discover their assumptions of their own risk tolerance change. If one had an appropriate portfolio risk then events like those across the pond (which are not actually extraordinary) are already factored in.

Changing asset allocation but keeping the same risk (e.g. still equities) is purely saying you think you can beat the market. Most of us are guilty of trying it - a little while back I posted a thread asking of there was any region that didn't have a doom and gloom story hanging over it at the moment.. and there wasn't really one - that results in the equity premium which compensates us for the risk we take. Which has to be balanced with opportunity risk if we don't take it.

GeoffTF

InvesterJones said:

chiang_mai said:

GeoffTF said:

chiang_mai said:

Lastly, all the major investment banks publish their asset allocation schedules for the coming quarter, along with their rationale for change in any sector. I particularly like the JPM allocation report. It's very clear from reading those reports that professional investors and investment banks, adjust their asset allocations, based on current events and their perception of future events, if they can make those adjustments, shouldn't less experienced investors do the same.

They can, but, on average, they fail to beat the market before costs. Some will beat the market, but you have no way of knowing which ones will do so in advance. Why do you believe that you can do better?

In case I wasn't clear in  my explanation, I was merely suggesting that investors should adjust their asset allocations, in response to known extraordinary events, such as the one taking place currently across the pond.....no more than that. Once again, it's tactical risk reduction.

I think a better way of thinking about it is investors should adjust their portfolio risk as and when they discover their assumptions of their own risk tolerance change.

Lots of people panic when other people panic, and sell riskier assets as a result. That is a common way of underperforming the market. Whatever you sell, someone else buys. The investors who buy whenever Trump throws a wobbly may well be the ones who win here.