Which ones to keep and which ones to kick? VUAA, VWCE, IWDA, QQQ, BRK B

[bangmegafan]

I have done some cleaning up of my IBKR watchlist and am looking for some inputs: i’d like to keep to 1-2 ETFs, 33 yo, not touching these for a long time.

Plan:
1. I’ll be investing 500€ ish per month, and some lump sums (2-5k every now and then). I’m on ibkr tiered should i switch and just buy 2-3 times per year larger amounts vs monthly?
2. I already own quite some stocks of MSFT and CRM. I sold off the rest but will probably buy again NVDA, AAPL, AMZN, TSLA. Hence thinking i rather have these and kick out QQQ?
3. I like BRK B, any opinions?
4. Surely sticking to wvce, maybe a better companion to it is the iwda than vuaa considering point 2 and 3?

Thank you!

 

[resjudicata]

@bangmegafan VWCE and chill.

 

[hellothere123]

@resjudicata Yea. Pick VWCE or IWDA depending on your preference and be done with it.

 

[dub_97]

@resjudicata This. Set up recurring buy every month and forget

 

[richardthelambheart]

@bangmegafan I have iwda and brk.b. Keep it simple.

 

[lndavout]

@richardthelambheart Why brk b specifically ?

 

[gcook]

@bangmegafan SP500 + Berk B

 

[bangmegafan]

@gcook Did a consolidation today to brk b, iwda and for now also kept my test investment from a month ago to vuaa of 75€. Iwda is pretty correlated to s&p 500 just have to decide on my core stack, eliminated the emerging from portfolio going with iwda instead of vwce.

 

[shilva]

@bangmegafan i don’t know why most Europeans especially germans have a boner for all world etfs. not only does it gets outperformed by the S&P500 year over year but it also has a +-3x TER. the common argument is diversification but the all world etfs are also already 60% American stocks with the other 40% just bringing the whole performance down. the other argument is past performance does not equal future performance but if something happens to the American economy the rest of the world is definitely also shitting the bed.

 

[william7000]

@shilva You’re in a European sub, so it’s normal that they would prefer something that encompasses the whole world. They will say “ VWCE & Chill”

Whereas if you’re in the US it’s a different story. A lot of them would say “ VOO & Chill”. Ofc you will also find some saying “VTI & Chill”.

It’s just a matter of where you are geographically located, which will determine what you prefer.

 

[tobiahjude99]

@william7000 In r/bogleheads you will find most there saying VT & chill actually.

which is the better VWRL/VWCE

 

[william7000]

@tobiahjude99 Of course, my point is that you would find a lot more Americans advocating for the s&p500 rather than Europeans.

At least that’s what I’ve noticed amongst my friends and amongst US FIRE subs, personal finance and investing ones.

At the end of the day, just hold one of the ETFs for a long period of time and keep on adding to your position, and you’ll be fine

 

[tobiahjude99]

@william7000 True and I definitely agree here.

 

[brendaj63]

@william7000 Home country bias.

 

[mantaeee]

@brendaj63 Recency bias as well.. That being said it doesn't necessarily mean the recent won't also be the future.

 

[tobiahjude99]

@shilva Would you have said that 2000-2009?

Also why not all-in QQQ then? It outperformed the s&p for a decade+ now.

Btw we are in a similar situation like 2000 right now. P/e ratios of US stocks are extremely high and the forward looking expected returns not as good.

https://www.wsj.com/finance/investing/your-set-it-and-forget-it-401-k-made-you-rich-no-more-c06552c

Good article on the topic.

Conclusion: international diversification, value and small cap value.

Also btw Vanguard‘s and iShares‘ Target Date Funds in the US, all have 40% international stocks.

It‘s their direct recommendation in the US.

 

[cliffranger48]

@shilva Truth be told, even guys like Warren Buffet or John Bogle prefer the SP500 over the world exposure.

Historically the US has done better. China and many other emerging countries are not safe to invest in (look at ehat happened with Russian assets not long ago) , and Europe is old and its not likely to ever catch up.

Of course thats already priced in, and thats why the sp500 pe ratio is way higher than others markets pe ratios.

Bogle said:

"If you own the S&P 500, you're already investing outside the US!"

Jack Bogle, founder and retired CEO of The Vanguard Group, speaks during the Global Wealth Management Summit in New York June 17, 2014. Jack Bogle, founder of the Vanguard Group, is not a fan of investing abroad.

The creator of indexed mutual funds thinks that investing outside of the US is too risky and American investors should keep their money at home. This is a point he's made numerous times, but in an interview with Bloomberg View's Barry Ritholtz, Bogle added another wrinkle: US investors already have money invested overseas even if they don't know it.

"US companies get half of their revenues... and half of their earnings from outside the US," said Bogle on Ritholtz's Masters in Business podcast.

"You have an international portfolio, why do you want a larger one?" Bogle's argument is that most companies already have sales in international markets, so by investing directly in foreign stocks investors are also exposing themselves to the macroeconomic conditions of those nations. In essence, you're not diversifying your risks away from the US economy but adding another risk to your portfolio.

Bogle pointed to the 3 largest holdings in international index funds as an example. "So if people knew they were putting 45% of their so-called international, non-US, money in Great Britain, France and Japan — I mean every one of those three countries has real problems," Bogle said. "The French don’t work very hard, The Japanese have a structured and deeply aging economy overburdened by future retirement claims… Britain doesn’t know what’s going to happen if they do the exit from the European community, nor do they know what’s going to happen if they stay in."

Whatever you do, stay the course and keep investing. I am using the sp500 as my main core investment and so far is doing very well. Furthermore, as a european, I feel I am already investing in Europe by paying my taxes here and owning a property here too.

When it comes to stocks, investing and innovating, I trust the US above anyone else.

 

[bangmegafan]

@cliffranger48 Thanks for the comment. Went with iwda as i am also more prone towards bidding on the us market. I dont think emerging will do enough catching up in the next 20-30y. If some companies do, im counting on buffet to profit me off that

 

[cliffranger48]

@bangmegafan

Thanks for the comment. Went with iwda as i am also more prone towards bidding on the us market. I dont think emerging will do enough catching up in the next 20-30y. If some companies do, im counting on buffet to profit me off that

You cant go wrong with that one (and neither with vwce or vusa). As long as you stick to it and maintain the course,in the long term you will make money.

 

[abrahamscaria]

@shilva There is absolutely no guarantee that the US will be leading for the next 40 years. That's why people play it safe.