Stop Investing In The World Index
ฝัง
- เผยแพร่เมื่อ 28 ก.ย. 2024
- 100% of my investing portfolio at the moment is in US Stocks.
The majority of my investments are in individual US companies.
But I also own a chunk of the S&P 500 and a bit of the Nasdaq 100 Index.
And there is a common thesis out there that this approach is a really bad idea.
Because investing in just US stocks carries a huge risk if the US economy or the stock market underperforms.
In this video I share my thoughts on why I disagree.
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The problem is if this happens, and the US just completely dominates the global economy, VT will reflect that. Instead of 60% it’ll be 80% or 90% whatever it is. It’s just the global market cap
The US is already a major part of the World Index and you therefore get good exposure to big tech companies (which have driven recent returns) such as Microsoft and Apple. For the sake of diversification (and because no one knows the future) the average person is far better investing in a world index rather than only the S&P 500. Indeed, I would recommend a World Index that includes small and medium-sized companies so it's only only very large companies you're invested in.
On a personal note, it isn't healthy for consumers to have some dominance by a few large American tech firms, which behave in an anti-competitive way and start over-charging customers and resting on their laurels. I hope we see new tech companies coming and and knocking the current incumbents off their perches (perhaps from countries outside the US).
Hey Sasha, nice video. I used to invest in both VUSA and VHYL until I realised that:
a) They're both dominated by the megacap S&P 500 companies anyway
b) The returns from VHYL, while not being anywhere near as bad as VUKE, just aren't there
It's honestly not a bad idea to just dollar-cost average into the S&P 500 every month. Personally I like to have some individual companies to stay motivated to invest, but I know the sensible thing is just to put it into VUSA as I'm extremely unlikely to beat the market (but I want to try). People get greedy and think that 9% is a bad return when it's actually a great return.
9% it's not bad the problem is the time window in which you make that, if it's per year for DCA (or ECA) it's not bad "for a retirement fund" anyhow you need to be as closer as possible to 10%/year in order to say it's perfect, more it's always good but 10% it's perfect for the purpose of DCA (or ECA) the only enemy remaining being the inflation that keeps eating in to your 9%, 10%/year. I guess ECA on VUSA (denominated in Euro) it's amazing.
Backtracking to 1996, Vanguards' Total World Index (which VT comprise ~40% of along with ~60%VTI) outperformed the S&P 500 10 out of 27 years. This may or may not happen again in the next 27 years. Whether or not you decide to invest in international or not, what matters most is consistently investing and staying the course. Either way, you're likely be ahead of people who constantly change investment plans and constantly buy/sell their stocks .
I know this is 2 months but if you look at e.g. VWCE, the world index is already 60% US.
It's one of the reasons I split it into 4 ETF so that I can have 10% EU, 10% S&P500, 5% China, 5% EM
I get my exposure to Canada and Australia through mining and energy ETFs
The brain drain thing is very real. I am an example of someone who fell for the Silicon Valley siren song. But so did almost everyone else I knew, including the most phenomenal engineers I know (a few went to Australia, New Zealand, several European countries and Canada instead). The ones who didn't leave the country outright are nonetheless working for foreign companies, mostly in the US.
Started to watch your videos because we look similar 😅 Thank you for sharing your knowledge, I am learning new stuff.
That outro music is always such a jam
Hey Sasha, your videos are very good and informative. Being from India I am already investing in Nasdaq as now there is opportunity to invest at discounted rates. 👍
@Capri Yes... I invest in Indian index... Along with it I am also investing in Nasdaq ETF.
@@Baby_Shivankhey isn't Nasdaq risky since it's tech heavy basically thematic index?? Why not invest in broader market index for example s&p500 or total us stock market(from vanguard)
@@Baby_Shivank btw am from india aswell and did u made any changes cause of recent tax change??
I already have enough trouble picking stocks in the most stable buisness friendly geographicaly dominant country in the world. Why in the hell would I try picking stocks in any other country?
I am just learning baby steps to investing in stocks but my query is....
Don't you all think that the US dollar is being artificially propped up and so while in the short term, USA stock market looks stronger, is it not just a mirage?
Ok, I found your email address now, so I will message you on email tmrw. Thanks
Anyone that listens to this guy is crazy - I can't wait for the FCA to cut down on TH-camrs that give out advice that isn't regulated/qualified. Soon come.
Hello. Still investing in tesla? 😅
You’re the man. Love your stuff.
Sasha, do you still agree with this video in 2024? Since EVERY single finance youtuber recommending and using global, but their reasoning is only based on " I dont know what will happen in the future", which is a true statement but doesn't have any logic behind it, since global index is still 70% of the USA, so if USA goes to hell, so does the global index, am I wrong? So why not just use the benefits of the "better average"?
Really depends on china flipping these countries and closing their markets to china only , it’s a US or China challenge?? So developed will be US dominated otherwise it’s china.
Kinda. It doesn’t immediately follow. It’s possible for people to sell US stocks and drive down the price and pile into indian stocks or whatever and drive up the price. US stocks going down may coincide with other stocks going up or it might coincide with all stocks generally going down because money is piling into something else.
Generally a global stock index is less volatile than the S&P 500 even if the S&P has outperformed it on average.
This is due mainly in part to the internet and high speed connectivity. What Japan did not that during their industrial height.
Hey Sasha. Love the videos. I think that 75% of my portfolio is in US, about 20% in UK, and about 5% in EU (France/Germany). 😲
Not to mention paying foreign withholdings taxes on dividends, which is usually a fixed amount and it's a lot to someone in a low tax bracket like me in a market that pays a lot of dividends. I don't understand why people go on about fees and yet never bring up foreign withholdings tax when talking about foreign investments.
As far as the Japanese bubble, those pe ratios were like 60-80, it was nothing like what the us stock market is valued at now. Japanese value stocks from around that time did pretty well going forward. Compare us small cap stocks and they are valued pretty much to the same degree as international stocks.
STRONG MAN IS COMMING FOR YOU
need some help...
i am 21, i have about 10k invested which is split between VUSA, SMT(scottish mortgage investment trust) and a couple of individual stocks.
I dollar cost average every month but i am sitting on about 5k in cash do i buy lump sum of VUSA or put it in a really highest interest rate savings account or guaranteed bonds by NS&I (which is locked away for a year)
any thoughts and ideas would be great :)
I notice a lot of “Global” funds seem to closely follow the US stock market anyway, since many of the biggest companies are US-based. Personally, I have a big chunk of my S&S ISA invested in US market, but my pension (Scottish Widows) is mostly in their so-called Balanced fund, which is a mix of countries, equities and bonds. It’s supposed to offer “steady” growth, although (like many other funds I guess) this year it’s been going backwards mostly 😢
Are you buying your s&p 500 etf in gbp or will you look for usd or a hedged version ?
How are you heading the cable risk?
lol the world index products offered in my country are already >60% In USA stocks😅
Me too!
What a coincidence! :)
Sasha: „I am not telling you what to do“
Titel of the video: „Stop investing in the world index“
😂😂🤷♂️
As if the US never will get into recesión…
It will. So will everywhere else.
All roads lead to Rome.
👍
The US is geographically overpowered, has a large population, younger average age and a higher birth rate than most other developed countries. It gives a very powerful domestic advantage as well as international
Please do another response video to Chicken Genius's latest Tesla take video...He went from the biggest TSLA fanboi to complete TSLAQ within one year.
I don’t really do responses to rubbish like that. I only ever did it 3 times when somebody gave extremely irresponsible specific advice (eg Go buy Floki Inu by Graham OR Sell everything now by the chicken man).
People being weird or flip flopping is none of my business.
@@SashaYanshin K....however chicken is pretty much selling sell everything now again lol
@@peterchon1179 Yeah. It’s a sad state of affairs when the blind is trying to find some other blind people to lead.
@@SashaYanshin very true
America!!!!! Fuck Yeah!!!!!
USA! USA!
❤❤
👍
Yes, it is 'different this time'... because 'past performance isn't indicative of future performance'... See the irony? Global fund fans always point to times when global stocks outperformed US stocks (because they are relying on 'past performance' to guide this decision). They argue that US investors think it's 'different this time'... (you can't have it both ways guys). Personally, I think its different this time- I look around me and I'm surrounded by US companies-iphone/Google/facebook/Tesla's/computers/AI/Coke/fast food chains/ American 4wd's.. At least we can grow food in Oz and dig holes. Phew.
Ruffled a few feathers. 😱
If the US has a civil war, the US stock market will get destroyed. If the US has a great economic collapse the dollar might not be worth much and having a portion of your portfolio relying on other currencies could help. If the US starts splitting companies because of anticompetitive practices, that could hurt. I wouldn't bet on one country. I suspect a 2nd amendment civil war in the coming decades.
Bad strategy. Shows you are not in the sectors and industries, looking for quality stocks. I NEVER speak in generalities. Let me provide you some examples: $SQM $TSM $NVS $BHP $MDT $ENB $PBR $NTR - All foreign stocks. Not sure why you are looking at just Japan in your thesis? There are American companies no longer on your list too. They've been acquired by foreign companies, filed for bankruptcy, went private and disappeared, or delisted due to consumer shift.
Investing only in one country constitutes a concentration risk, regardless of how far reaching its companies are. These companies are subject to one regulator …….all you need is an ultranationalist government or some self inflicted black swan event and it’s good night. The way the US is going nowadays, I couldn’t say this could never happen there. Slightly lower returns on a global etf , but I 💤 well at night.
Sleep well at night with your lower returns
If the USA goes down the rest of us are going with it…
Sweet dreams Comrade. Your exposure isn't hugely lower in a Global etf anyway. If 'merica goes down we are all screwed old mate.
@@redda2😂 wonderful answer.
Have you checked that the global ETFs holdings are in fact global? Often the global indexes are made to reflect the biggest companies in the world, which are american. So you end up with and ETF with "global" in the name, but like 80% US holdings.
Sorry to break your bubble, but if you actually read the literature on the topic, then you will see the investing globally is the smarter and less risky strategy.
Which literature exactly is this?
As far as i know the 2 people i respect the most john bogle and buffer both always choose sp500.
I am curious to see which other people u regard above these 2
Hi Sasha, good points, I get it (biggest companies happen to be in the US). However, that isn't a good argument for *not* investing in companies based elsewhere. The argument for world index is more about *risk* . I.e. the only way to reduce risk is through *uncorrelated* investments. Investing in US base or high market cap, increases correlation (since the rest of the world will never be perfectly correlated). And since we cannot *expect* any investment to outperform any other, you don't lose anything.
And yes, you may underperform SNP500 this decade, and underperform gold next decade etc. But that's the point, you will always underperform another asset group of assets - you trade returns for reduced risk.
From what you have said, seems like you are doing *active* trading whereas indexing is more passive so it's apples to oranges really.
all those things you said about the US are priced in. the "us companies have global market exposure" is a useless argument because if that's what makes them good -- well non-US companies also have global market exposure.
Markets are efficient, there is no reason for US stocks to outperform. Yes US companies are Better, you know this, i know this, the market knows this and that why US stocks have Higher PE aka they are more expensive as all the good about the US is prised in to the point we expect the same risk adjusted returns. But being invested in more companies that are fairly priced you get the benefits of diversification, that are having lower volatility with the same expected returns.
Think about it why do you think US stocks whould be expected to produce higher risk adjusted returns than the world and peaple are not selling the world to buy the US, ohh they have done so see the higher PE of US stocks.
BETTER COMPANIES DOES NOT INDICATE BETTER STOCKS !
IF US companies do better than international companies THEN international stocks will overperform.
IF US companies do a lot better than international companies THEN US stocks will do the same as international.
IF US stocks do much much better than international ONLY then US stocks will overperform.
As the market prices in that the US will do a lot better.
The fact they overperform market expectations in the past is not an indication they will do so in the future. It's like investing in a single sector cuz it did well in the past :p
The only countries it might make sense to focus Investments are countries with capital controls that the global market does not have access and you do if they have higher expected returns due to low capital investment.
Love your videos. On this occasion I don't fully agree. World index is already 60% US and only 10% emerging markets. I like having a world index tracker as a minority part of my portfolio as low cost, large spread and low effort, and can be less volatile than the holdings I have in growth funds. I also think that for investors starting out or just with limited knowledge and/or time it is a good option. Horses for courses.
The emerging markets are export economies, if their clients in US and Europe underperforms, so do them.
Stick to where the money is, not where the cheap labour js
@@hkchan1339 economy isnt stock market 🤓
Growth historically underperforms value
@@hkchan1339that could change though. Intercountry trade between emerging economies has been exploding in growth. Not so much to us and Europe.
By that logic why not hold the best companies each country offers given that to become successful they need to eventually globalise their activities
I’m sure the consumers of Ozempic products are truly global. Why not own a slice of Novonordisk even though it’s a Danish company?
I've been quite pleased with my shares in Novo Nordisk myself :) struggle to agree with Sasha that just investing in the US is best... I'd miss out on some good dividend stocks from the UK too. BAE wouldn't get a look in either and they're a good UK MilDef stock to have.
7:00 your whole analysis is based on flawed grounds. Why would India, as a state, allow access of U.S. companies to its customer base? Same for China? All the U.S. companies in the top 10 list you share only exist because of IP doctrines. IP doctrines U.S. enforces with military and political coercion. The opposite is true than that of your analysis -- as these countries grow out of poverty, develop tax bases inside, start spending on military, thus can wane off U.S. coercsive influence -- the value of American companies that receive Uncle Sam protection decreases.
Those poor countries will never develop as u think. China will have lost 50% of its population in next 70yrs. Usa will have increased population
China will never come close to gdp per capita
One thing that shaha is not saying is that he doesn’t make money on investment, his main income is TH-cam!
Infact he would rather lose money on his investment for the sake of making a TH-cam video.
So…what I’m saying is don’t listen to him. He is an entertainer.
Yes correct he is a Youinvestortube
You may be right, but you're still gambling
i dont think is healthy to invest into just one market. for example US market. In the future they might not be the best performing.
But the s &p 500 isn't really one market as it's hugely international in nature and revenue and well diversified
Love your vids but have to completely disagree here. If you’d have stuck to this thesis then in 2022 when US was way over valued your portfolio would have got decimated only just recovering this year and not fully. The reason why in 2022 I went for a fund with a low risk. 50 in us 10 Japan etc and most in defensive health care and undervalued stock. It gained slightly on 2022 when markets tanking. I’m waiting till next year to rotate all into Vanguard Developed world etf that pays a 1.89 dividend and only a .12 fee with 70% being in America and no need for emerging markets.
2000 up until 2009 was a lost decade for the US stock market. Japan had more than 10 yrs lost. If you had put $10000 in the Vanguard S&P 500 index investor fund in Jan 2000 for example, by Dec 2009 it would be worth $9016 with dividends reinvested. A total international ex US Index did show positive returns, but still not that good a return.
10,000 but then worth 9000 ,shit that 😂
@@147breaks I guess you either have to have somewhat longer than just 10 yrs or and you need some extra diversification, add a diversified low cost bond index fund or etf to your portfolio and rebalance once a year to maintain your asset allocation. So you might be 60% equity and 40% bonds or whatever you feel comfortable with depending on your time frame and ability to bare risk, stay the course and not be tempted to sell or change your strategy. You need some money you can afford to leave invested for the long term
I think you are getting it wrong. The idea of a global fund is that if money move from one place to another you will not feel it in your investment because owning stock across the glob will gurantee that you capture those money in other markets. Also all global indexes are alreade US and developed markets heavy, they are design to only dip a little bit in the emerging markets growth if there is any. Also any huge growth in emerging markets will come at an expense of moving money from a developed market hance you feel the impact on your investment would be minimal. Not to mention the accumulating etfs and low fees that will save you lots of money.
I’m mostly in agreement with him but don’t think you lose much in terms of risk/reward by holding ~20% of ex-US over the long term in case the U.S. sees an extended period of underperformance. But markets seem so correlated at the large index level it’s an open question how such a globally significant market as the U.S. could falter and not see the rest of the world in similar if not worse shape.
international small cap value has outperformed S&P every decade/ no exception. Even at the very top of nikkei bubble if u bought japanese small cap value index u d have made 4,6pct a year for 30 years vs still underwater if u bought a chunk of the largest caps. And the best value is in Europe at the moment (even more true as EURUSD at a 25pct discount to PPP which is the most decent long term indicator). This favors EU exports etc. You have tons of niche markets and/or world leaders in their sector in europe (valeo which benefits from EVs is like buying tesla at 20 bucks, Socgen (not just a bank trading at 30pct tangible book but EU nr1 online + controls world leader in car leasing, etc. ). The story about silicon valley etc. well basically it means being concentrated in the tech sector... which is where u ll see the largest unpredictable shifts overtime as tech is mostly disrupting ... tech. Tech makes the old boring companies more efficient though
Can I borrow your crystal ball? Investing looks so predictable
This is not a good thing. Spreading more decreases your risk while not not changing your expected return that much. Apart from that, the US public debt is crazy high. Europe will be very interesting in the coming year due to low public debts, good value of the stock/etf’s with massive potential growth compared to the US.
This doesn't make sense. Having exposure to other countries economies isn't the same as having exposure in foreign stocks. Individual stocks should be accurately priced and dont necessarily go up when an economy is doing better.
I don’t get your logic. It’s just EMH, every company is worth what it’s worth.
Why make the argument no one can pick stocks and then pick them yourself?
The only thing you need to do, in my opinion, is rank the world and have the percentage of your portfolio in the exact percentage of the total world market cap. Nothing else matters
The only argument is that fees are higher on world than US, but you’re more accurate to the total world market cap, meaning your more inline with the intelligence of the market
Everything is priced in, research is pointless, and if you beat the market it was only through luck.
I expected this to be more about how global index funds aren’t actually very diversified because of the massive US tech stock allocation
I watch most of Sasha's videos and also watch most of James Shack's videos - after catching up on both channels it's very clear to me why Sasha made this one haha!
I saw that video after James commented. Was actually a complete coincidence!
in 2000: over 3 years nasdaq down 80pct. During that same period ppl were shouting recession in Europe yet EU cyclicals did great on that period paying fat divs and up in the end
USA has done well, but the expectation is US dollar will weaken over the next 2 years. All world trackers are 60% US stocks anyway.
Stop investing in the world index...and invest in some new shirts 😂. You're literally wearing the same two shirts in every single one of your videos!
And?
Depends on what you optimize for. I agree; looking at my personal portfolio, while never having lived in the US. But if a friend asks me where to invest long-term, who has no intention to ever research companies or look at the stock market, I recommend VT. The reason is that this will work, even if all you described shifts in the next 10 years, while only giving slightly worse expected results. In the case of such a friend, resilience is far more critical than 1% additional gains.
S&P500 would be the best play then
What does VT stand for here?
@@AlasdairILoveOxford should be the all country world etf from vanguard
yes, exactly. It's about risk, not returns. Shocking that even many people who own these funds do not realise this.
You are not calculating the risk factors of concentrated investment. When diversifying globally you lessen the risk (possible damage x chance of it happenning) of cases like:
- Political mismanagement
- too weak or too powerful currencies
- geographical anomalies
- Sanctions and other regulations (we saw what happened with russian stocks in the worlds exchanges this year)
While i dont think and hope that the US has any problems, anything can happen. Diversifying isn't therefore "free lunch". There are of course oppurtunity costs associated with it.
Great and interesting to hear viewpoint nonetheless
VTI and chill vs VT and chill. That is a good question indeed.
I understand all of your points... but still. Jurisdiction risk.
So you are investing completely undiversified - one asset class and a single country. I would rethink everything if I were you but good luck anyways!
Did I say anything about asset classes?
@@SashaYanshin Apologies, I thought you only invest in stocks...
@@Alex-mi6fh I do own other classes - in fact I invest way more into my business than I do in stocks at the moment for example 👍
In my opinion the Core MSCI World index pretty much has your approach in mind but with better diversification and not excluding the big players outside of the United States.
i am non U.S but predominantly invest in the S&P. the only reason i hold some other country stocks is simply foreign currency risk/diversification...
Where a company gets its earnings/revenue from does not change how its stock behaves. US companies still behave similarly to the US market and not international markets. I think this point also understates how large international companies are. They also generate a large amount of revenue from the US, so why even bother investing in the US if my Asian and European markets already make money from the US?
I also don't think people are speculating doom for the US when they invest internationally. Otherwise, they still wouldn't hold the US as the majority of their investments. They want to buy and hold every company in the world and not be locked down to a singular country.
The top 10 holdings of VE are almost identical to all of the US large cap ETFs. All US based companies.
The reason I bet solely on the US is exactly what you said, the brain drain. The us takes more immigrants than any other country, they speak English (the 2nd and 3rd languages are Spanish and Chinese, which are 2 other massive languages), they have a well marketed culture, they have a mythology that shaped the modern world and people still believe in, the American dream. These reasons allow the US to be such a versatile economy that can pull the smartest minds form all over. Even people from other nations move there to start businesses like Musk. I am no fan boy, I can just see that the US is different from the old world due to its lack of homogeneity.
This is such great noninvestment advice.
Stock market crashes and Depressions begin in the debt market. Look at what happen in 1929. It began with Austria's inability to pay the WW1 war reparations which drag down the German banks
who were closely linked to them. In turn Germany could not pay her WW1 war reparations. They attempted to print more currency to avoid national insolvency. Result was hyper inflation
and financial collapse. It's effect spread and ultimately affected the US stock market whom many US banks took people's savings and speculated in it.
An over-priced but brilliant company is still over-priced.
An overpriced but brilliant company may never be traded ever again at current prices as fundamentals improve to the point that it no longer looks overvalued. You need to lots of intricate domain specific knowledge to tell the difference in most cases; sometimes its obvious like NFTs which are an obvious zero; sometimes it is not.
If you’re an index investor you likely don’t even pretend to know details of individual companies. I’d still pick an index that has good historical performance and is somewhat resistant to hype and bubbles like S&P equal weight or msci world quality sector neutral. If nvidia becomes hyped to the moon an equal weight index will end up selling it off to keep weight equal. This could somewhat ”cut the flowers” but it also invest into the flowers before they get recognized by everyone. It has historically performed a bit better than market weight S&P.
I had to laugh at #15 america online. what a magnificent rise and incredible crash it was! felt like i was mailed 5 CDs a month from them.
There were some amazing huge stocks in the US in 1999 - the Dot Com bubble was definitely in order!
Has Ramin rejected your advances? 🤣
JGGI is my main holding . I can’t remember why I bought it in the first place but it’s been fantastic.
Well, one invests where one can. If Google was based in Antarctica, there is no broker with access to that exchange. Citizens in many countries simply cannot invest abroad. Govts. do not let their money flow outwards.
Still, US exchanges are the most accessible globally and therefore most investments flow there. But it would be difficult for me to buy a stock in Brazil or India.
This is the sort of controversial out of box stuff I subscribe for, great video. Certainly food for thought. One of the core problems with this approach however is you're not diversified across governments, if some current or future government meddling breaks the economy or the companies somehow you've got all your eggs in one basket.
Thank you and good point. Although I perceive the risk of that significantly screwing things as relatively lower than other risks.
@@SashaYanshin Perhaps, hard to quantify imo. Have you seen the UK recently 😉
@@Whoop0 😂😂😂 Don’t remind me!
Strongman approves lol
Isn’t there a big risk regarding the currency exchange of investing 100% in the US. When I first came to the UK 30 years ago the pound was roughly 2:1 with the US dollar. Today it is closer to 1.24:1. Right now the pound is very low. If it keeps dropping in value then you will gain something but if the reverse happens and the pound starts rising again will this not reduce your gains on the market.
I think you're exactly right, but didn't the guy say he lived in US now? Regardless, 100% anywhere seems a little reckless, 100% in a single foreign market with a foreign currency would be foolish.
I have no idea what is the "neck eye", but I agree with 100% of what you said.
Fun Fact: Apple has a higher market cap than the entire UK FTSE 100. You could also argue it alone is more diverse and financially secure than the entire FTSE.
Some families worth this.
Nobody invests into the UK FTSE 100 though? The FTSE All World is still 60% American market share. The top 10 holdings (making up 20% of the total ETF) of the FTSE All World are all American companies.
@@bodycounter9386 FTSE 100 is still a very popular investment in UK. I think for most people, some domestic overweighting is a good idea. Personally I'm putting 25% into uk, which is probably too much.
@@tomonetruthI prefer to pick individual stocks for the UK market. BAE Systems, Rolls Royce, BP, Rio Tinto, even Games Workshop!
@@tomonetruth25% home bias is about right
The US is looking strong. I am happy to have most of my investments in US companies.
I could not make up my mind, so I went 50% s&p 500, 50% global index and will never rebalance.
I will get the average and hopefully they will both increase.
Isn't global (VT) like 55% US allready? So you re around 75% US which is OK since many experts reccomend that ratio to be optimal long term.
@@massafelipe8063 I did consider the heavy overlap, but think its okay as long as the US keeps being dominant.
If not the global index will phase me out automatically.
@@wingtsun1 I went for msci world quality and us value. Still around 75% US, which is more than enough US.
@@massafelipe8063haha of course it is, some Sharp cookies here
@@wingtsun1oh dear oh dear
I been saying the same thing. Asian markets are screwed, European company’s are also screwed there is really nosy to put your money outside of the US market.
Why are Asian markets screwed?
Time there were Global ETFs ex-USA available
are you still as convicted as you where when you made this video? Great content thanks for making it
sp500 outperformed the world
Actually, over the last 5 years, Taiwan and Denmark have beaten the US. Historically, Canada, Australia, Denmark, Hong Kong, the Netherlands, and Switzerland have outperformed the US. Most of the S&P 500 growth is due to Mag 7 tech stocks. Outside of them, growth has been sluggish. @Jabskin
I read the title, and was like... ahhh crap what!!
What could it be?!?!
@@SashaYanshin very interesting topic as always. I like it when u take a subject that seems logical but when u throw data at it it’s wrong. 🙌
I think it's reasonable to overweight US stock if you think the US will outperform like you do.
I also have a lot of sympathy for US investors who stay out of international investments due to currency/political risk and dividend withholding tax; although since I don't live in the US the opposite applies to me.
I'll also say, your point about Japan is a good one; and I wouldn't see being US-only as heavily risky.
However, I'd disagree that it's the best approach.
Firstly, I wouldn't necessarily say US stocks are the most undervalued but justifying that will take detail so I'll leave that for now. But most stock markets seem somewhat undervalued right now anyway.
What I will say is that while you're right that large US companies have diversified demand; that doesn't mean that adding international won't improve diversification.
If I was bullish about the US, I'd overweight the US but still include a (smaller) international allocation.
Firstly, there's also the supply side to worry about.
You cite California companies attracting worldwide talent, but that should be at least partially priced in (although of course if it's not fully priced in that's bullish for the US). But if, say, the US government introduces a lot of aggressive anti-immigration policies, that advantage disappears and US companies are worth less.
As another example, there could be natural disasters in California which hit the Californian infrastructure these companies rely on.
Secondly, you don't necessarily need to add another area to make something more diversified. Imagine you were invested in a cap-weighted s & p 500 etf; except 50% of the companies in there were randomly removed. It probably wouldn't be missing any particular sector or customer base, but nevertheless it would be less diversified than the full s & p 500. I see it as similar with vusa vs vwrl.
No, I don't think I will
Hi Sasha, how do you invest in NASDAQ 100 while being in UK? Is it invesco Nasdaq 100?
EQQQ or EQQU index or 3x leverage QQQ3/LQQ3
Would you recommend investing in Vanguard S&P 500- apparently it’s like the top 500 companies in US and it’s almost like investing in the American economy.
Am I right ? Would like some advice / knowledge on this
The s&p 500 is exactly what you have said. It's the top 500 companies in the USA.
@@markmahood3093 worth investing ?
@@josueherrera5049 need to do your own research. What suits 1 person may not suit another.
@@markmahood2019 honest answer- cheers
I would personally prefer the Core MSCI World index over the S&P 500. My plan is to invest over the next decades and too many things can happen in that time to be focused on a single country. My opinion though.
Very bad!
Problem coming, dollar is strong today and at sometime will get weaker (when economy gets better), therefore hurt SNP500 returns in GBP.
Thanks Sasha! What about a list of your personal Top Ten US companys to invest....?
Is this a response to James Shack 😅? Good points though!
Actually it wasn’t 🤣🤣🤣
Mine is all in US stocks too I have a few UK stocks, but I find the ftse moves so damn slow with very little vertically innovative businesses.
It’s interesting how similar the make up of the FTSE today looks like the S&P 500 in the 70s and 80s. Banks, Mining and other raw material companies and Tobacco.
@@SashaYanshin Definitely, no innovation not even much horizontal globalisation, worryingly. Our government stifles innovation.
Remember that value beats growth over the long term. Investors routinely overpay for lottery-ticket growth stocks, which leaves those miners and tobacco companies cheaper than they should be. In the long run, those cheap stocks have more chance of making you rich.
@@johnny10gunz19 And Brexit was supposed to make UK into a powerhouse. They rejected support from EU for their own national growth. With what I've seen from Liz so far, it's not looking good.
@@chrisf1600 Yes, but rather have US tobacco or value stocks. I've got value uk banking stocks etc I'll be 80 years old by the time they make me any serious money.
No disagreement with the point of not investing in a World index. However, plenty of the biggest companies in Europe get their profits from exports outside of Europe.