Thank You Ben & Cameron for informational, intellectual and insightful podcast. Most of the time I am listening to you while walking. Your great guests, books reviews and education on investment changed my perspective on personal finance.
I found it amazing that Australia had the least home country bias. I see why franking credits were introduced. I suppose it because slot of our assets are invested through Super. Might also because we have an undiversefied economy, so you need to go elsewhere for more exposure.
Another excellent episode. You mentioned updating your model, so I guess my only question is, does your model still include XEC at 8% and XEF at 16%, or have these changed? Thanks.
I dont understand fully what your points mean about emerging markets. I get that there is a Diversifikation benefit BUT do we also have higher expected Returns?
35:17 you say expected returns tend to be higher because the domestic investors cannot diversify, though foreign investors cannot invest. Does the former really outweigh the latter such that the expected return is increased? Must we not also consider the average wealth of countries with segregated markets?
i would love to invest in EM stocks but there is no low cost Value Weighted SM ETF out there i can access so i dont for now. Do you guys know a product like this for less then 0.5%?
Unfortunately, diversifying far outside the typical markets costs extra and may or may not deliver a premium. I like AVEM, AVES, and EEMS as ETF’s with high expected returns. But they all have high costs.
I just heard your podcast (with some delay). As always an excellent speaker with a ton of useful advice. I wanted to add an observation to your comment about the Russian ETF losing 99% since the start of the Ukraine war, because it provides an interesting case study in favor of 'the home bias'. As you know, since the Ukraine war started in 2022, G-7 imposed sanctions on Russia. In retaliation, Russia prohibited investors from 'unfriendly countries' from trading Russian shares, and prohibited companies from paying them dividends or other distributions. Also, it looks like unless G-7 unfreezes Russia's sovereign assets, the G-7 shareholders will probably not get their money back. This explains the loss of 99% on the iShares Russia ETF. However, for the local investors and those from neutral countries (India, China, Middle-East, Brazil, Africa) there are no restrictions at all. The Russian stock market is open for trading and is only down 30% since the war in US dollars (a bit less in total return counting the 4% dividend yield). So an investor from, say, Dubai would be down 99% on the iShares Russia ETF, and only down 30% if he bought the same shares directly.
Language barrier might be a good explanation of home bias. Hardly 5% of Russian population speak English. You've got to speak English to be able to invest outside your local language market.
The profit margins of U.S. companies are significantly higher than Chinese companies. People don't realize this. But overall income of Chinese companies is growing faster.
Emerging Markets will lag as the world bank buys more gold & lenders tighten & banks fail… cash will be king & commodities will be cheap & so will real estate & so will stocks & a lot of money will be wiped out
Timestamps:
0:00 Intro
8:29 Cameron's Recommendations
23:05 Emerging Markets
1:01:24 Discussion with Morgan Housel
Thank you guys again for another extraordinarily good insight. Your level of professionalism is highly appreciated. Well done!
Thank You Ben & Cameron for informational, intellectual and insightful podcast. Most of the time I am listening to you while walking. Your great guests, books reviews and education on investment changed my perspective on personal finance.
I was waiting for this episode from morning 8am, Perth Western Australian time.
I found it amazing that Australia had the least home country bias. I see why franking credits were introduced. I suppose it because slot of our assets are invested through Super. Might also because we have an undiversefied economy, so you need to go elsewhere for more exposure.
I couldn't read the graph, too blurry, turns out it said Austria!
Another excellent episode. You mentioned updating your model, so I guess my only question is, does your model still include XEC at 8% and XEF at 16%, or have these changed? Thanks.
That bit with Morgan house was great, gonna use some of those tips to cultivate my reading habit.
I thought you had abondened youtube, glad I found you again, Ben
I dont understand fully what your points mean about emerging markets. I get that there is a Diversifikation benefit BUT do we also have higher expected Returns?
Very interesting take on Emerging Markets.
What would you update in your model portfolio? Would you replace XEC by an Avantis equivalent?
35:17 you say expected returns tend to be higher because the domestic investors cannot diversify, though foreign investors cannot invest. Does the former really outweigh the latter such that the expected return is increased? Must we not also consider the average wealth of countries with segregated markets?
48:00 US value stocks underperformed US growth stocks.
Was Japanese Nikkei an emerging market when it collapsed in the 90s?
No it was one of the biggest (if not THE single biggest) stock markets in the world.
Amazing!
i would love to invest in EM stocks but there is no low cost Value Weighted SM ETF out there i can access so i dont for now.
Do you guys know a product like this for less then 0.5%?
Unfortunately, diversifying far outside the typical markets costs extra and may or may not deliver a premium. I like AVEM, AVES, and EEMS as ETF’s with high expected returns. But they all have high costs.
I just heard your podcast (with some delay). As always an excellent speaker with a ton of useful advice. I wanted to add an observation to your comment about the Russian ETF losing 99% since the start of the Ukraine war, because it provides an interesting case study in favor of 'the home bias'.
As you know, since the Ukraine war started in 2022, G-7 imposed sanctions on Russia. In retaliation, Russia prohibited investors from 'unfriendly countries' from trading Russian shares, and prohibited companies from paying them dividends or other distributions. Also, it looks like unless G-7 unfreezes Russia's sovereign assets, the G-7 shareholders will probably not get their money back. This explains the loss of 99% on the iShares Russia ETF.
However, for the local investors and those from neutral countries (India, China, Middle-East, Brazil, Africa) there are no restrictions at all. The Russian stock market is open for trading and is only down 30% since the war in US dollars (a bit less in total return counting the 4% dividend yield). So an investor from, say, Dubai would be down 99% on the iShares Russia ETF, and only down 30% if he bought the same shares directly.
Come back to the Ben Felix channel please. 😭
Third.
it's not an NFT drop 😂 .
Language barrier might be a good explanation of home bias. Hardly 5% of Russian population speak English. You've got to speak English to be able to invest outside your local language market.
@@george6977 yeah, you obviously speak English but don't read it well: You have to speak English to invest internationally including Japan, my friend
@@safetyfirst2417 * emotional damage *
The profit margins of U.S. companies are significantly higher than Chinese companies. People don't realize this. But overall income of Chinese companies is growing faster.
This books analogies sound horrible...
Emerging Markets will lag as the world bank buys more gold & lenders tighten & banks fail… cash will be king & commodities will be cheap & so will real estate & so will stocks & a lot of money will be wiped out