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Hi! Love your videos! I am currently deciding whether to choose lifestrategy or global all cap for retirement. What do you think? I think the UK home bias in lifestrategy is unnecessary and not truly diversified. Why would I choose lifestrategy over FTSE global all cap?
@@theoceanman6221 I agree with you. And I saw while searching for Vanguard UK I think it was, I saw Vanguards website for institutional investors, I guess that includes IFA's, they do actually do lifestrategy funds without the UK bias. But it looks like not for retail investors. Seems a bit strange to me
I prefer the HSBC global strategy due to the lack of UK bias. But I ended up just going with the HSBC FTSE all world as I wasn't interested in bonds or property and is a cheaper fund.
Very good point at 7:00. Calculating CGT on Accumulation funds is *hard*, especially if you have held them for a long time, and it's easy to declare the wrong tax or pay too much tax (paying both income and capital gains tax on the same money). Brokers aren't much help either - you're lucky if they give you a statement of capital gains at the end of the year. When income and capital gains are taxable, I'd always go for Income units so that your dividend reinvestment is not hidden within the unit price, and you can clearly see what is income and what is capital gain.
@@jcjackson4626 I'm resident in PRC, but I think it could be more general advice since I (obviously) don't want to park my money here but either repatriate it or send it somewhere else.
Interesting video. I’m in the process of changing my modest pension to Vanguard. A financial advisor recommended for me to put my pot into the LS100 fund and despite the UK bias I’m probably going to take his advice for simplicity. Only time will tell if it will be a big mistake but despite the poor performance of U.K. stocks and a sluggish U.K. economy LS 100 has still produced surprisingly good returns over the past few years so I’ll probably stick to his advice.
I’m about to turn 50 and have just one fund - Vanguard FTSE Global All Cap Index Fund GBP Acc. I’ve considered buying IGLA for some downside risk ( and may still do ), but, I also need the growth so I’m all in with equities at the moment. I’m all about keeping things simple.
@@yiguanas812 There’s no right or wrong, it’s purely down to the individual’s decision and whether you want to have more exposure and weight to emerging markets. You’ll pay a higher fee, but, in return you’ll have more potential upside too.
@@yiguanas812 one off costs for etf not included in that fig. I want 1 fund with small caps, few bp won’t make a difference to me until it’s 6 figures. (My isa, not pension)
Canadian Vanguard Asset Allocation funds as they are called also have a home bias in the 25% range compared to Canada's 3% global weighting. For Canada, reading Vanguards reasoning (lower volatility, lower currency risk, favourable taxes) does seem to make sense probably because Canadian markets are more tightly correlated with the US than UK is with the US.
I quite like the HSBC Global Strategy Dynamic and I am already invested in it - it is mainly equities with some bonds and property, low fees and doesn’t require any thinking. When held on Fidelity platform it will give me a simple automated monthly income of my choice when I retire. Not the cheapest option but there are much worse options out there.
Ramin I could kiss you! I have wanted something like this, ie without heavy UK weighting, for ages. It will help me simplify my T212 portfolio immensely! Plus with you having created it, I felt extra confident.
Thanks Ramon, another excellent video. May I ask if you are going to follow up on the index linked bond once it matures? And again thank you for producing.
Great video, thanks! The HSBC portfolios look interesting. My only concern is there may be a lack of small cap allocation which when being adventurous can help add an extra bit of spice over the long run. I think small caps are undervalued at the moment so it may be worth having a small allocation just to be completely diversified. In my opinion the FTSE Global All Cap is the best one fund option for long term investors who only want equities in their portfolio.
Recent research indicates that maintaining a 100% equity portfolio with a home country bias (a little more biased than what LS offers for the UK) has the least risk in terms of the likelihood of exhausting your accumulated wealth during retirement.
@george6977 actually, the data show that holding about 35% home country stocks is optimal, so in the US it would be an international bias. Obviously that wouldn't have paid off over the last decade, but remember that non-US stocks have outperformed US stocks in over 40% of rolling decades over the last 50 years. And expected returns are currently lower in the US than in most non-US markets.
@@davec3974 I think that data was based on a US investor, so the home bias was US stocks, and over the very long term so far the US seems to have performed better than non US, international or global ex US. And they've been saying US stocks are overpriced for some yrs now and expected future returns will be lower. But I think the truth is nobody really knows, no one has a crystal ball. And the US has continued to outperform since 2009, despite doom and gloom mungers. Of course things can & do change, that's why it might be prudent to hold something like ftse all world index fund or eft so if the US starts to go down it will make up less of a cap weighted index. So in the future the US might only make up 30% of the index for example
@fredatlas4396 the data comes from 38 developed markets. Of course, nobody has a crystal ball, but if someone is going to make a stock investment decision that deviates from a global market cap weighted index, then it makes sense to do so based on expected future returns obtained from empirical models. Anyway, the research in question isn't about maximising returns, it's about minimising the risk of not meeting future spending requirements.
@fredatlas4396 also the data supports holding 35% home country stocks, so while this calls for a home country bias outside the US based on current market cap, it calls for an international bias in the US.
This is very interesting. Having watched your videos I have been in the process of moving from Nutmeg to Trading 212. The ETFs I have chosen (with global exposure) Far out perform my 80% Nutmeg holdings. This is again down to Nutmegs exposure of 20% in the UK market. However The two key Black Rock ETF's do not do as well as Ishare's World Quality which itself outperforms Vanguard's FTSE All World. Nutmeg has consistently outperformed Vanguard Life Strategy over the last few years BTW. This has been a great video for me. I'm now tracking/assessing the two key Black Rock Global ETFs, which Nutmeg uses, with a view to incorporating them into my Pie. Goodbye to large Fees! :) Many thanks another really helpful video.
According to Vanguard's founder John Bogle you shouldn't chase returns, marker timing is a losing game and that ishares quality etf may have outperformed recently but there's no guarantees it may well under perform the market in future. So Mr Bogle says don't look for the needle just buy the whole haystack, buy and hold and stay the course no matter what. Plus keep costs low
@@fredatlas4396 Broadly I agree with you. However, life and investing move on. We now have Five Factor Theory (which postdates his statement I am sure) and, with computers, an increased ability to analyse. If you compare iShares Quality factor World ETF to Vanguard World ETF, over the overlapping lifespan, the difference becomes very clear indeed. Yes, events might turn that on it's head, but for the last few years Vanguard's offering has lagged fa behind. They say we shouldn't look at the past to predict the future too. However looking at the past performance of Vanguard Life Strategy and Nutmeg's managed funds Nutmeg consistently outperformed Vanguard and they have continued to do so for the last three years in which I have been invested. How else could I choose without looking at past performance? Stick a pin in? So many things are said in the investing world. Thanks for coming back though. I appreciate your POV. Though I expect neither of us are wholly correct. Be well. FWIW - I use Only ETF's as main main tool for choosing ETFs.
Hi @kevinu.k.7042 I'm glad that the move has worked out for you and that you've found my videos helpful. The more I use pies the more I like them! Thanks, Ramin
@@fredatlas4396 My previous reply to you has not stuck. This is a very brief reply. I get the sense that the world has moved on. We now have Factor Funs. They are more like buy the farm, but not the rusty tractor and the rotting shed. I favour Quality and ?Momentum Factors.
@@kevinu.k.7042 Obviously that's your decision to make, but just saying Vanguards founder Mr Bogle didn't agree with those strategies, he said don't look for the needle, just buy the haystack. And if you have a very long time frame just keep in mind any higher fund charges for those funds as opposed to the straightforward cap weighted broad market index funds or etfs
Have you watched Ben Felix’s recent “Home County Bias” video? He discusses a recent paper that presented evidence that may influence your thinking on this. I think the bottom line is that we probably need to factor in currency risk, and potentially the tax and/or local fee implications tied to domestic markets (tax free wrappers, not withstanding). If VG were not now so comparatively expensive in the passive fund market (who would have thought this would come to pass), and included emerging, I would even consider switching from my current global investment. The other point to consider is, in respect of your home made pie “one fund”, is that T212, while they do offer an ISA (I have one with them, for example), do not offer SIPPs.
Hi Ramin another great informative video...please can you do another video on Vanguard's Target retirement date funds. I am 53 and have the 2045 fund ( 77 23 portfolio balance) in my Vanguard ISA. Also have the Ftse Developed world VHVG in my Vanguard SIPP . Again doing really well at the moment. keep up the good work. I know that you have this one as well....
I think vanguard did us all a favour by making the market more fee competitive, but in general when I look at their funds they seem to have very modest performance, I would rather pay more for a better return, just a thought.
Thanks for another very helpful video. One comment I would make about Vanguard is their customer service, in my experience it’s poor and they need constant chasing to respond to secure messaging and it’s very off putting. It would be helpful to know your thoughts on customer service from various companies.
I agree. I've had a few issues with them recently, they are slow to respond and not very helpful. I thought the last response from them was particularly poor.
Very good video. Thanks. I have HSBC funds and was considering Vanguard LS. As you say just investing yourself could achieve the same. A very relevant video.
I hold both LS80 and FTSE world ex UK in a 1-4 ratio, cheaper than just LS and as I’m £ cost averaging I can tweak ratios month by month to alter home bias to one I’m happy with
Ramin, have you looked at the columbia threadneedle universal funds? It would be interesting to see a similar video including these funds which offer active management (asset allocation and stock selection) at a passive price.
Great vid as usual. Do you have any vids on how use these funds in particular the hsbc when in retirement. The yield is low with the inc funds is the omly way to sell units on top of taking yield . The royal London gmap funds are worth a look apparently the dealt with the recent bond crash very well .
Hi Ramin. Interesting video and I'd not heard of the HSBC strategy funds. Regarding your T212 pies, haven't you overweighted Europe in them? Or maybe that was the intention.
Thanks Ramin. If you used the State Street S&P 500 tracker SPXL it's expense ratio is 0.03% saving a fair amount versus any other ETF tracking the S&P 500. It is also an ACC ETF and domiciled in Ireland.
Do you ever consider stock lending risk in ETFs especially if you have a concentrated portfolio of ETFs. You may be diversified with stocks but some ETFs can lend up to 30% of their stock. This could mean you have a credit risk to a basket of unquantified collateral provided by some of these potential firms to which stock has been lent. As we saw there can from time to time be major bankruptcies of systemic financial firms. Don’t you think that in a large portfolio, the holdings should be split between several ETFs even if they track the same index?
Hi Ramin, I have a Question! I started investing in VG LifeStrategy fund (have been doing it for 3 years and my portfolio is 26%+) but have realised that I can get better exposure and performance from other funds you mentioned in your previous video like VHVG. I'd like to know what's the best approach to switch the funds from one to the other fund? Should I do it all in one go?
I've noticed that the equity percentage in each of the HSBC funds does not appear to remain static unlike the LSfunds. On the HSBC webpage it shows the Dynamic fund as having 70% equity, however of Fidelity's site it shows it as having 81% equity, that's abig difference, is that right?
@julienhamon1558 If you're in a sipp or stocks and shares isa there's no tax to pay when rebalancing. No tax for isa and only pay tax for the sipp when you start drawing money out if it goes above the annual tax allowance
@@fredatlas4396 212 dont seem to have a sipp 😪...... Id like to copy one of the pies but ill have to wait until i can open a new isa in april it looks like😔
Hi Ramin love the channel. Just saved your Asset Mix 100 pie on T212 - how does the risk / reward profile of this compare to Vanguard & HSBC? Any chance of a comparison chart / follow up? Thanks!
Hi Ramin, I was looking at SPXP using a website that i found by listening to your podcast (just etf) and i noticed it was a synthetic ETF. I done a little research into the difference between synthetic and physical and have a fair idea of the main Differences but would you say there is a higher element in risk in owning a synthetic etf over a physical etf?
I followed Damiens homemade life strategy vid about a year or so ago, you end up with three ETFs using his method. If nothing else, it's worth doing to easily visualise how the three components move with your actual real money IMO. I decided UK was trash so thought I'd swap the bias to US, changing the ftse ETF for an S&P500 ETF (yeah, I know the dev ETF is predominantly US, I was just curious). Anyway, since swapping UK for US it's just whizzed along.
Thanks Ramin, do you think it would be better to have two funds if you needed to draw cash out regularly, eg annually, an equity one, and a bond one, so that you could sell one or the other if either out performed , otherwise you would be selling both asset classes at once for say vanguard 60 fund.
Long time follower here. I have a question re trading 212 in relation yo the 4.2% interest offered on euro cash. Is the capital protected? And if so how nad fie how much? Thanks for your feedback.
I looked it up and found that Trading212 has $14 billion in assets under management, and Vanguard has $7.1 trillion. So Trading 212 is 0.1972% of the size of Vanguard.
@@coderider3022 True, and the number far Vanguard also seems too big. Strange. But the truth seems to remain that Trading212 is a fraction of a % of the size of Vanguard.
@coderider3022 True, and the number far Vanguard also seems too big. So much for whatever source I stumbled across. But the truth seems to remain that Trading212 is a fraction of a % of the size of Vanguard.
'An annual review' should be fine for most who want to be a passive investor. Not only will it limit time looking at pies/investments (as pretty as they are, this makes zero money), but reduce the risk that people will start trying to time markets (unless they play that game by choice) or acting emotionally. For people looking to be more engaged, aside from thinking of how often to rebalance time-wise, perhaps it can be more useful to consider using parameters. For example, if I choose 75/25 equity/bond split as being what should reach my goal within my risk appetite, how far from that should I let my portfolio drift? Do I really want to be 90/10 and not rebalance, or 50/50? In both cases, the portfolio risk changed yet my goal did not. I don't think that would make sense. If you're doing geographical trackers having set US to say 70% of the 100% global equities, do you want to let it to get to 80% when much of that 80% is in a small number of companies? Ultimately, the choice is the individual's. Finally, aside from selling and buying to rebalance, redirecting dividends paid out or altering the monthly regular investment choice can be options to rebalance without selling.
Hi, I already have stocks and share ISA with HSBC and plans to open Trading 212 Invest account. -can I keep funding both HSBC S&S ISA and Trading 212 ISA account? -or are we only allowed to open 1 stock and share ISA? -or can I can open new trading 212 ISA but stop funding the HSBC ISA account? Thanks
From this april, you can open and invest in as many ISAs of same type as you want so you could add to both at the same time. The only limitation is that the total that you can deposit in the financial year for all should be 20k max (that part is similar to how it is now). So maybe you could invest 10k in each HSBC and 212, or however you decide.
The UK overweight on life strategy is a beef of all UA-cam financial planning peeps. But against the backdrop of the UK struggling to get investment, the risk is that UK-based personal investors are part of the stampede that forces UK governments to keep on putting up personal taxses because the economy is stagnant.
@DocNick68 Putting up personal taxes doesn't boost the economy, and our tory government since 2010 has been cutting taxes for big corporate businesses and the wealthy at our expense. We now have the lowest corporation tax in all the G7 nations and most likely a lot more besides but it hasn't boosted the economy, those ceo's and directors just putting the money in their pockets, not even reinvesting it back into said companies, I think that's part of the reason UK companies not growing, unlike the US businesses, that and UK stocks paying higher dividends to shareholders, it's extremely short sighted. And the wealthy people haven't been spending it into the economy, they are just investing their extra money into the markets and property. It's in fact the working classes who drive economies but only when they get payed enough, have spare capital to spend. This is why our economy hasn't really gone anywhere since 2010 under our tory government, and now they've put taxes up by freezing the personal allowance and tax thresholds. Plus indirect, stealth taxes have actually gone up a lot since 2010, like council tax going by 4.5% every year and last year up by 6.7%, road fund tax up since 2010, VAT up to 20% since tories in charge etc etc. Plus they've slashed all funding for all public services including the NHS since 2010 in real terms adjusted for inflation they have absolutely buggered our country
I've seen on Vanguard UK website for institutional investors, IFA's they do lifestrategy funds without the UK home bias, more close to the ftse all world index. Not sure why they aren't providing those funds for retail investors
Not mentioned in the video. Over the past 5 years the S&P500 has outperformed the Lifestrategy 100% Equity Fund, and, for that matter, all the other funds mentioned in the video.
@@eweng903 It's still recency bias. Behavioural psychology plays a very big part in investing, it's the reason why passive investing works, that and the low costs. Watch some John Bogle videos, buy and hold, stay the course, be well diversified across regions, sectors and asset classes. From about 2000 up until 2009 was a lost decade for the US stock market. If you'd put a lump sum in the S&P 500 index in 2000 it would have been worth less in 2009 even with dividends reinvested. Don't look for the needle, just by the haystack. This is wisdom from John Bogle, who had a lifetime of investing experience in the markets. And the reason why he invested only in the US was because of the currency fluctuation risk, but other US professionals didn't agree with him on that, they thought investors should have some global exposure
@helixvonsmelix WTF, What planet are you living on, where have you been since 2010. The tories have all but destroyed our country since 2010. Things were in fact much much better under the last Labour government from 1997 up until 2010. The economy was really booming for the first time since before 1979, funding for all public services greatly increased in real terms adjusted for inflation, and NHS waiting times coming down a lot right up until 2010, introduction of the minimum wage, workers rights protected etc etc. Well since 2010 it looks like the tories have undone all the good the Labour Party did, they've scrapped the Labour governments policies which were working for our country. The tories are literally destroying our country
The UK is currently a miserable country to invest in so I wouldn't touch the Life Strategy with their UK overweight bias! Brexit, Tories and general malaise in the country means I'll stick with my FTSE Global all cap for now.
@roger4880 Yes I'd rather invest in the whole world. The Tories have created a low growth economy and the Majority of people voted to perform self harm by voting for Brexit. Both of which have been disasters. Meanwhile the government are more interested in creating culture wars rather than fix the mess they've created. Foreign investors won't come near the UK and for good reason. So why would I? Until we have a competent government, Closer ties with the EU and any sign of future growth, I'll keep my money elsewhere.
@george6977 Fair enough. Im ok investing in China as part of an overall portfolio but I wouldn't invest in Chinese companies. Morally I don't have a problem. America is a corrupt country with blood on their hands from all over the world. And although although they claim to be democratic, the way they are going after Trump suggests otherwise. I'd sooner live in America than China. But America doesn't have the moral highground.
@@bobdigi500Absolutely agree with you 100%, I'm really hoping we get a different government by the end of this year, if the cons remain in power things can only get worse
The home biased is completely understandable. Until very recently, I assumed that the FTSE performed just as well as US stocks. In addition to that, I would have assumed non-sterling stocks would mean exchange rate fees, so I would probably never look at non-UK stocks. I know which has done significantly better, its just I can understand why there is a UK biased. That & I would prefer to support UK companies, rather than foreign. What a mistake!!!!
The old phrase of " when the USA sneezes , the UK gets a cold " is a real truism. The opposite is also true. UK does " quite well " , the US snd others do a lot better. Unfortunately , my 40-85 managed pension fund has a 24% UK weighting. Too late for me to change now.
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This is not financial advice. When investing, your capital is at risk. Investments can rise and fall and you may get back less than you invested. Past performance is no guarantee of future results. Terms and fees apply* - www.trading212.com/terms/invest
Hi! Love your videos! I am currently deciding whether to choose lifestrategy or global all cap for retirement. What do you think? I think the UK home bias in lifestrategy is unnecessary and not truly diversified. Why would I choose lifestrategy over FTSE global all cap?
@@theoceanman6221 I agree with you. And I saw while searching for Vanguard UK I think it was, I saw Vanguards website for institutional investors, I guess that includes IFA's, they do actually do lifestrategy funds without the UK bias. But it looks like not for retail investors. Seems a bit strange to me
I prefer the HSBC global strategy due to the lack of UK bias. But I ended up just going with the HSBC FTSE all world as I wasn't interested in bonds or property and is a cheaper fund.
Very good point at 7:00. Calculating CGT on Accumulation funds is *hard*, especially if you have held them for a long time, and it's easy to declare the wrong tax or pay too much tax (paying both income and capital gains tax on the same money). Brokers aren't much help either - you're lucky if they give you a statement of capital gains at the end of the year. When income and capital gains are taxable, I'd always go for Income units so that your dividend reinvestment is not hidden within the unit price, and you can clearly see what is income and what is capital gain.
Would greatly appreciate if you could do a video for UK citizens who are non-resident.
Maybe mention where you’re a resident
@@jcjackson4626 I'm resident in PRC, but I think it could be more general advice since I (obviously) don't want to park my money here but either repatriate it or send it somewhere else.
Interesting video. I’m in the process of changing my modest pension to Vanguard. A financial advisor recommended for me to put my pot into the LS100 fund and despite the UK bias I’m probably going to take his advice for simplicity. Only time will tell if it will be a big mistake but despite the poor performance of U.K. stocks and a sluggish U.K. economy LS 100 has still produced surprisingly good returns over the past few years so I’ll probably stick to his advice.
If the US slow or dollar weaken, I think the uk bias will help.
@@coderider3022 Very good point! Thanks.
You could just buy VWRL/ SWDA or HSBS all-world index fund c
The LS produces good returns. So many people are obsessed with beating the market.
I've started buying some as a result of the video. I didn't know about these. I like life strategy as well though so I have both.
Would u buy both lifestrategy and hsbc
@@rsb8653 I have both, Yes. So many youtubers say just buy this or just buy that or choose this or that... why? Just get them all lol
I’m about to turn 50 and have just one fund - Vanguard FTSE Global All Cap Index Fund GBP Acc.
I’ve considered buying IGLA for some downside risk ( and may still do ), but, I also need the growth so I’m all in with equities at the moment.
I’m all about keeping things simple.
My single isa holding is this too. Bit expensive but on vanguard the .15 makes it worth while.
I have 80% in Global All-Cap and 20% in US Total Stock Market. The latter increases growth and reduces overall fees.
I recently ditched Vanguard's global all cap for Vanguard's FTSE Developed World UCITS ETF, which is 0.11% cheaper.
@@yiguanas812
There’s no right or wrong, it’s purely down to the individual’s decision and whether you want to have more exposure and weight to emerging markets.
You’ll pay a higher fee, but, in return you’ll have more potential upside too.
@@yiguanas812 one off costs for etf not included in that fig. I want 1 fund with small caps, few bp won’t make a difference to me until it’s 6 figures. (My isa, not pension)
Many thanks Ramin for this, i was looking for a multi asset fund such as the HSBC range.
Canadian Vanguard Asset Allocation funds as they are called also have a home bias in the 25% range compared to Canada's 3% global weighting. For Canada, reading Vanguards reasoning (lower volatility, lower currency risk, favourable taxes) does seem to make sense probably because Canadian markets are more tightly correlated with the US than UK is with the US.
I find it very interesting looking into these funds
Doing it yourself is fun and can get you to retirement quicker. HSBC is I love them HSBC all world , HSBC American index and I love
For non UK investors, note that the Vanguard Life Strategy EUR funds on Trading 212 do not have a UK home bias - they have no home bias.
I quite like the HSBC Global Strategy Dynamic and I am already invested in it - it is mainly equities with some bonds and property, low fees and doesn’t require any thinking. When held on Fidelity platform it will give me a simple automated monthly income of my choice when I retire. Not the cheapest option but there are much worse options out there.
Ah is that one down from the highest risk?
@@slabbygabby Yes.
Ramin I could kiss you! I have wanted something like this, ie without heavy UK weighting, for ages. It will help me simplify my T212 portfolio immensely! Plus with you having created it, I felt extra confident.
Happy to help! @angeleyes306
Thanks Ramon, another excellent video. May I ask if you are going to follow up on the index linked bond once it matures?
And again thank you for producing.
Id steer clear. I bought an index linked bond 6-7 years ago and it's plummeted by 40%.
Great video, thanks! The HSBC portfolios look interesting. My only concern is there may be a lack of small cap allocation which when being adventurous can help add an extra bit of spice over the long run. I think small caps are undervalued at the moment so it may be worth having a small allocation just to be completely diversified. In my opinion the FTSE Global All Cap is the best one fund option for long term investors who only want equities in their portfolio.
Recent research indicates that maintaining a 100% equity portfolio with a home country bias (a little more biased than what LS offers for the UK) has the least risk in terms of the likelihood of exhausting your accumulated wealth during retirement.
OK if your home country was US.
@george6977 actually, the data show that holding about 35% home country stocks is optimal, so in the US it would be an international bias.
Obviously that wouldn't have paid off over the last decade, but remember that non-US stocks have outperformed US stocks in over 40% of rolling decades over the last 50 years. And expected returns are currently lower in the US than in most non-US markets.
@@davec3974 I think that data was based on a US investor, so the home bias was US stocks, and over the very long term so far the US seems to have performed better than non US, international or global ex US. And they've been saying US stocks are overpriced for some yrs now and expected future returns will be lower. But I think the truth is nobody really knows, no one has a crystal ball. And the US has continued to outperform since 2009, despite doom and gloom mungers. Of course things can & do change, that's why it might be prudent to hold something like ftse all world index fund or eft so if the US starts to go down it will make up less of a cap weighted index. So in the future the US might only make up 30% of the index for example
@fredatlas4396 the data comes from 38 developed markets. Of course, nobody has a crystal ball, but if someone is going to make a stock investment decision that deviates from a global market cap weighted index, then it makes sense to do so based on expected future returns obtained from empirical models. Anyway, the research in question isn't about maximising returns, it's about minimising the risk of not meeting future spending requirements.
@fredatlas4396 also the data supports holding 35% home country stocks, so while this calls for a home country bias outside the US based on current market cap, it calls for an international bias in the US.
Well, thank you for creating and sharing the pies!
You're welcome @_mklein
This is very interesting. Having watched your videos I have been in the process of moving from Nutmeg to Trading 212. The ETFs I have chosen (with global exposure) Far out perform my 80% Nutmeg holdings. This is again down to Nutmegs exposure of 20% in the UK market. However The two key Black Rock ETF's do not do as well as Ishare's World Quality which itself outperforms Vanguard's FTSE All World.
Nutmeg has consistently outperformed Vanguard Life Strategy over the last few years BTW.
This has been a great video for me. I'm now tracking/assessing the two key Black Rock Global ETFs, which Nutmeg uses, with a view to incorporating them into my Pie.
Goodbye to large Fees! :)
Many thanks another really helpful video.
According to Vanguard's founder John Bogle you shouldn't chase returns, marker timing is a losing game and that ishares quality etf may have outperformed recently but there's no guarantees it may well under perform the market in future. So Mr Bogle says don't look for the needle just buy the whole haystack, buy and hold and stay the course no matter what. Plus keep costs low
@@fredatlas4396 Broadly I agree with you. However, life and investing move on. We now have Five Factor Theory (which postdates his statement I am sure) and, with computers, an increased ability to analyse. If you compare iShares Quality factor World ETF to Vanguard World ETF, over the overlapping lifespan, the difference becomes very clear indeed. Yes, events might turn that on it's head, but for the last few years Vanguard's offering has lagged fa behind.
They say we shouldn't look at the past to predict the future too. However looking at the past performance of Vanguard Life Strategy and Nutmeg's managed funds Nutmeg consistently outperformed Vanguard and they have continued to do so for the last three years in which I have been invested. How else could I choose without looking at past performance? Stick a pin in?
So many things are said in the investing world.
Thanks for coming back though. I appreciate your POV. Though I expect neither of us are wholly correct.
Be well.
FWIW - I use Only ETF's as main main tool for choosing ETFs.
Hi @kevinu.k.7042 I'm glad that the move has worked out for you and that you've found my videos helpful. The more I use pies the more I like them! Thanks, Ramin
@@fredatlas4396 My previous reply to you has not stuck. This is a very brief reply. I get the sense that the world has moved on. We now have Factor Funs. They are more like buy the farm, but not the rusty tractor and the rotting shed. I favour Quality and ?Momentum Factors.
@@kevinu.k.7042 Obviously that's your decision to make, but just saying Vanguards founder Mr Bogle didn't agree with those strategies, he said don't look for the needle, just buy the haystack. And if you have a very long time frame just keep in mind any higher fund charges for those funds as opposed to the straightforward cap weighted broad market index funds or etfs
Have you watched Ben Felix’s recent “Home County Bias” video? He discusses a recent paper that presented evidence that may influence your thinking on this. I think the bottom line is that we probably need to factor in currency risk, and potentially the tax and/or local fee implications tied to domestic markets (tax free wrappers, not withstanding). If VG were not now so comparatively expensive in the passive fund market (who would have thought this would come to pass), and included emerging, I would even consider switching from my current global investment. The other point to consider is, in respect of your home made pie “one fund”, is that T212, while they do offer an ISA (I have one with them, for example), do not offer SIPPs.
Hi Ramin another great informative video...please can you do another video on Vanguard's Target retirement date funds. I am 53 and have the 2045 fund ( 77 23 portfolio balance) in my Vanguard ISA. Also have the Ftse Developed world VHVG in my Vanguard SIPP . Again doing really well at the moment. keep up the good work. I know that you have this one as well....
I think vanguard did us all a favour by making the market more fee competitive, but in general when I look at their funds they seem to have very modest performance, I would rather pay more for a better return, just a thought.
Thanks for another very helpful video. One comment I would make about Vanguard is their customer service, in my experience it’s poor and they need constant chasing to respond to secure messaging and it’s very off putting. It would be helpful to know your thoughts on customer service from various companies.
I agree. I've had a few issues with them recently, they are slow to respond and not very helpful. I thought the last response from them was particularly poor.
There's so many funds. Id never even heard of HSBC strategy funds
*are
Very good video. Thanks. I have HSBC funds and was considering Vanguard LS. As you say just investing yourself could achieve the same. A very relevant video.
With the HSBC funds, do you have to keep paying into them every month?
10:40 its not about beeing easier to market, is about preservation for extreme events
How did you get comfortable with the credit risk of one fund allocation?
Ramin -how do trading 212 make their profit? Surely it must be on the spread. This is like "smoke and mirrors" to the unsophisticated investor.🤫
Thanks for making this video after my super chat request Ramin
@mthw It was a good suggestion. Thanks Ramin
"80% Bonds = Lower risk profile" - *tries not to look at the long-duration bond ETF crash in 2022-2024 that still hasn't recovered*👀
a 30/70 stock/bond split in the worst of times seems to have the higest chance of failure wth 60 40 stocks/bond the lowest
I hold both LS80 and FTSE world ex UK in a 1-4 ratio, cheaper than just LS and as I’m £ cost averaging I can tweak ratios month by month to alter home bias to one I’m happy with
Watching from Egypt
Your videos are wonderful always
Thank you @ebrahimhabib477
We classify HSBC as passive/ active their biggest move is to be sort of 2% under/overweight
Ramin, have you looked at the columbia threadneedle universal funds? It would be interesting to see a similar video including these funds which offer active management (asset allocation and stock selection) at a passive price.
You can also negative screen by selecting a number of country etfs and avoid pointless markets like Uk, china/HK A/H, India
Great vid as usual. Do you have any vids on how use these funds in particular the hsbc when in retirement. The yield is low with the inc funds is the omly way to sell units on top of taking yield .
The royal London gmap funds are worth a look apparently the dealt with the recent bond crash very well .
Hi Ramin. Interesting video and I'd not heard of the HSBC strategy funds. Regarding your T212 pies, haven't you overweighted Europe in them? Or maybe that was the intention.
You should find out then do you own inspired video……
Ramin you criticise Vanguard for too much in UK but your 9% in Japan is surely 100% more than its % of World GDP - Why??
Im on 212 could you please make a video about the leveraged ETFs on there? Thanks. 😊
Thanks Ramin. If you used the State Street S&P 500 tracker SPXL it's expense ratio is 0.03% saving a fair amount versus any other ETF tracking the S&P 500. It is also an ACC ETF and domiciled in Ireland.
It's not available on T212. On which platforms is it available?
Fidelity has it, I believe it was released in October 2023 - quite new to the market.
AJ Bell has it
@roger4880
Thanks, I see SPXP uses synthetic swaps so is US withholding tax free, as is I500.
@@george6977 What is 1500 ?
Do you ever consider stock lending risk in ETFs especially if you have a concentrated portfolio of ETFs. You may be diversified with stocks but some ETFs can lend up to 30% of their stock. This could mean you have a credit risk to a basket of unquantified collateral provided by some of these potential firms to which stock has been lent. As we saw there can from time to time be major bankruptcies of systemic financial firms. Don’t you think that in a large portfolio, the holdings should be split between several ETFs even if they track the same index?
Please could you explain the difference between the FTSE and MCSI World indexes ?
Didn’t you do this video already?
Thanks!
Thank you @nigelbradley217 much appreciated!
Hi Ramin, I have a Question!
I started investing in VG LifeStrategy fund (have been doing it for 3 years and my portfolio is 26%+) but have realised that I can get better exposure and performance from other funds you mentioned in your previous video like VHVG.
I'd like to know what's the best approach to switch the funds from one to the other fund?
Should I do it all in one go?
I've noticed that the equity percentage in each of the HSBC funds does not appear to remain static unlike the LSfunds. On the HSBC webpage it shows the Dynamic fund as having 70% equity, however of Fidelity's site it shows it as having 81% equity, that's abig difference, is that right?
The downside is tax impact on rebalancing on Trading 212 which you dont have when it's the fund (Vanguard or HSBC) doing it directly
@julienhamon1558
If you're in a sipp or stocks and shares isa there's no tax to pay when rebalancing. No tax for isa and only pay tax for the sipp when you start drawing money out if it goes above the annual tax allowance
@@fredatlas4396 i m not UK tax resident
im new to investing....I never even thought about tax to rebalance outside of an isa...Thank you for pointing this out
@@fredatlas4396 212 dont seem to have a sipp 😪...... Id like to copy one of the pies but ill have to wait until i can open a new isa in april it looks like😔
HSBC are currently tempting customers with a chance of winning money if they open one of said portfolios with just £50. Is it worth it?
Hi Ramin love the channel. Just saved your Asset Mix 100 pie on T212 - how does the risk / reward profile of this compare to Vanguard & HSBC? Any chance of a comparison chart / follow up? Thanks!
Hi ramin . Will you be tracking the asset mix portfolios performance wise
Hi Ramin, I was looking at SPXP using a website that i found by listening to your podcast (just etf) and i noticed it was a synthetic ETF.
I done a little research into the difference between synthetic and physical and have a fair idea of the main Differences but would you say there is a higher element in risk in owning a synthetic etf over a physical etf?
I followed Damiens homemade life strategy vid about a year or so ago, you end up with three ETFs using his method. If nothing else, it's worth doing to easily visualise how the three components move with your actual real money IMO.
I decided UK was trash so thought I'd swap the bias to US, changing the ftse ETF for an S&P500 ETF (yeah, I know the dev ETF is predominantly US, I was just curious). Anyway, since swapping UK for US it's just whizzed along.
I’m now with VUAG S&P 500 with my SIPP and S&S ISA, doing good so far..
@@Project-Masculinityin for a ride!
Hi Ramon, is the referral code still valid? I looked at the t&c and it says the promo campaign period ends on 14th Feb 2024.
Hey Ramin, thanks for the video. I tried accessing your pies but I can’t see them when I click the links in your video
It’s a shame you can’t search for pies in T212
Thanks Ramin, do you think it would be better to have two funds if you needed to draw cash out regularly, eg annually, an equity one, and a bond one, so that you could sell one or the other if either out performed , otherwise you would be selling both asset classes at once for say vanguard 60 fund.
One fund would automatically re-balance itself if you were to top slice (sell) annually.
I have the Lifestrategy 60 but would also like to have some investments high risk. Is running the S&P 500 ETF alongside the LS 60 worthwhile?
Pretty sure the S&P is already part of the portfolio, just at a lower %.
What platform is the cheapest/best to invest in HSBC Global Strategy funds?
It all depends on The size of your portfolio
Long time follower here. I have a question re trading 212 in relation yo the 4.2% interest offered on euro cash. Is the capital protected? And if so how nad fie how much? Thanks for your feedback.
It's based in Malta and isn't covered by the UK 85k guarantee, but it seems there is some kind of euro protection but I wasn't confident.
I looked it up and found that Trading212 has $14 billion in assets under management, and Vanguard has $7.1 trillion. So Trading 212 is 0.1972% of the size of Vanguard.
Website says £3.5B ?
They’re completely different businesses..
@@coderider3022 True, and the number far Vanguard also seems too big. Strange. But the truth seems to remain that Trading212 is a fraction of a % of the size of Vanguard.
@coderider3022 True, and the number far Vanguard also seems too big. So much for whatever source I stumbled across. But the truth seems to remain that Trading212 is a fraction of a % of the size of Vanguard.
Vanguard has been around for ages Trading 212 is a relative newcomer, so nota fair comparison.
If you go for the self managed T212 pie option, how often should you rebalance? Once a week? Month? Year?
Never….let the winners run…unless there is a good reason not to.
'An annual review' should be fine for most who want to be a passive investor. Not only will it limit time looking at pies/investments (as pretty as they are, this makes zero money), but reduce the risk that people will start trying to time markets (unless they play that game by choice) or acting emotionally.
For people looking to be more engaged, aside from thinking of how often to rebalance time-wise, perhaps it can be more useful to consider using parameters. For example, if I choose 75/25 equity/bond split as being what should reach my goal within my risk appetite, how far from that should I let my portfolio drift? Do I really want to be 90/10 and not rebalance, or 50/50? In both cases, the portfolio risk changed yet my goal did not. I don't think that would make sense.
If you're doing geographical trackers having set US to say 70% of the 100% global equities, do you want to let it to get to 80% when much of that 80% is in a small number of companies? Ultimately, the choice is the individual's.
Finally, aside from selling and buying to rebalance, redirecting dividends paid out or altering the monthly regular investment choice can be options to rebalance without selling.
Doing it yourself is more interesting and exciting...keeps your mind active and gives you an interest in life in your retirement.😂😂😂
Good video thanks. Very helpful.
Thank you @lja8187
Hi, I already have stocks and share ISA with HSBC and plans to open Trading 212 Invest account.
-can I keep funding both HSBC S&S ISA and Trading 212 ISA account?
-or are we only allowed to open 1 stock and share ISA?
-or can I can open new trading 212 ISA but stop funding the HSBC ISA account?
Thanks
From this april, you can open and invest in as many ISAs of same type as you want so you could add to both at the same time. The only limitation is that the total that you can deposit in the financial year for all should be 20k max (that part is similar to how it is now). So maybe you could invest 10k in each HSBC and 212, or however you decide.
@@Kaizen917 Oh! I’ll wait for April then! Thanks a lot!☺️
The UK overweight on life strategy is a beef of all UA-cam financial planning peeps. But against the backdrop of the UK struggling to get investment, the risk is that UK-based personal investors are part of the stampede that forces UK governments to keep on putting up personal taxses because the economy is stagnant.
@DocNick68
Putting up personal taxes doesn't boost the economy, and our tory government since 2010 has been cutting taxes for big corporate businesses and the wealthy at our expense. We now have the lowest corporation tax in all the G7 nations and most likely a lot more besides but it hasn't boosted the economy, those ceo's and directors just putting the money in their pockets, not even reinvesting it back into said companies, I think that's part of the reason UK companies not growing, unlike the US businesses, that and UK stocks paying higher dividends to shareholders, it's extremely short sighted. And the wealthy people haven't been spending it into the economy, they are just investing their extra money into the markets and property. It's in fact the working classes who drive economies but only when they get payed enough, have spare capital to spend. This is why our economy hasn't really gone anywhere since 2010 under our tory government, and now they've put taxes up by freezing the personal allowance and tax thresholds. Plus indirect, stealth taxes have actually gone up a lot since 2010, like council tax going by 4.5% every year and last year up by 6.7%, road fund tax up since 2010, VAT up to 20% since tories in charge etc etc. Plus they've slashed all funding for all public services including the NHS since 2010 in real terms adjusted for inflation they have absolutely buggered our country
I've seen on Vanguard UK website for institutional investors, IFA's they do lifestrategy funds without the UK home bias, more close to the ftse all world index. Not sure why they aren't providing those funds for retail investors
I got out of the UK after Brexit, would be happy to get back in if I saw some hope in the future.
Not mentioned in the video. Over the past 5 years the S&P500 has outperformed the Lifestrategy 100% Equity Fund, and, for that matter, all the other funds mentioned in the video.
Recency bias.
S&P500 has also beaten all the Lifestrategy funds over the past ten years.
@@eweng903 It's still recency bias. Behavioural psychology plays a very big part in investing, it's the reason why passive investing works, that and the low costs. Watch some John Bogle videos, buy and hold, stay the course, be well diversified across regions, sectors and asset classes. From about 2000 up until 2009 was a lost decade for the US stock market. If you'd put a lump sum in the S&P 500 index in 2000 it would have been worth less in 2009 even with dividends reinvested. Don't look for the needle, just by the haystack. This is wisdom from John Bogle, who had a lifetime of investing experience in the markets. And the reason why he invested only in the US was because of the currency fluctuation risk, but other US professionals didn't agree with him on that, they thought investors should have some global exposure
In the HSBC portfolio, the second lowest risk is conservative. Shouldn't the highest risk be called labour?
@helixvonsmelix
WTF, What planet are you living on, where have you been since 2010. The tories have all but destroyed our country since 2010. Things were in fact much much better under the last Labour government from 1997 up until 2010. The economy was really booming for the first time since before 1979, funding for all public services greatly increased in real terms adjusted for inflation, and NHS waiting times coming down a lot right up until 2010, introduction of the minimum wage, workers rights protected etc etc. Well since 2010 it looks like the tories have undone all the good the Labour Party did, they've scrapped the Labour governments policies which were working for our country. The tories are literally destroying our country
The UK is currently a miserable country to invest in so I wouldn't touch the Life Strategy with their UK overweight bias! Brexit, Tories and general malaise in the country means I'll stick with my FTSE Global all cap for now.
So you rather invest in China 🙃 with your all cap etf?
Maybe the UK is miserable because people make it so.
@roger4880 Yes I'd rather invest in the whole world. The Tories have created a low growth economy and the Majority of people voted to perform self harm by voting for Brexit. Both of which have been disasters. Meanwhile the government are more interested in creating culture wars rather than fix the mess they've created.
Foreign investors won't come near the UK and for good reason. So why would I?
Until we have a competent government, Closer ties with the EU and any sign of future growth, I'll keep my money elsewhere.
I now prefer to avoid direct China and Hong Kong exposure.
@george6977 Fair enough. Im ok investing in China as part of an overall portfolio but I wouldn't invest in Chinese companies. Morally I don't have a problem. America is a corrupt country with blood on their hands from all over the world. And although although they claim to be democratic, the way they are going after Trump suggests otherwise. I'd sooner live in America than China. But America doesn't have the moral highground.
@@bobdigi500Absolutely agree with you 100%, I'm really hoping we get a different government by the end of this year, if the cons remain in power things can only get worse
Hi, don’t you have a pb with the reputation of HSBC. They were dealing with drug dealers !
The entire market is a shady place.
Vanguard life strategy is garbage 🗑
I used LifeS 100% but became fed up of home basis, so went for the Vanguard Global.
The home biased is completely understandable. Until very recently, I assumed that the FTSE performed just as well as US stocks. In addition to that, I would have assumed non-sterling stocks would mean exchange rate fees, so I would probably never look at non-UK stocks. I know which has done significantly better, its just I can understand why there is a UK biased. That & I would prefer to support UK companies, rather than foreign. What a mistake!!!!
The old phrase of " when the USA sneezes , the UK gets a cold " is a real truism. The opposite is also true. UK does " quite well " , the US snd others do a lot better. Unfortunately , my 40-85 managed pension fund has a 24% UK weighting.
Too late for me to change now.
Thanks
Thank you! @gavthegas547