That's a solid overweighting of EM 😅
You don't see that often either. Good luck with that.
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@G30G43BR4 Hi Felix, in my experience, a 30% allocation to EM is not a solid overweight, but is in line with common practice.
I would be happy to receive further feedback :)
LG superhero
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@superheroman You already have an EM share in $VWRL. So it's over 30%.
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@Speggi Hi Dominik. That's right, of course, the VWRL contains just under 10% EM, which gives an overall weighting in the portfolio of around 40%. However, in my opinion, I am not deviating from common practice with this strategy and, in my opinion, I am not explicitly taking an extremely high risk. I am also happy to receive feedback :)
LG superhero
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@Speggi won't the em share in the FTSE aw be increased anyway if they perform better?
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@superheroman That was more related to the fact that you often see portfolios here where the MSCI World is used as the core and EM is deliberately omitted because this has depressed returns in recent years. Please don't take the statement in a judgmental way 🙂


Basically, when it comes to the question of EM weighting, the issue is that (for various reasons) the share of EM in global market capitalization differs from the share of global GDP. Everyone has to decide for themselves what weighting to use.

In total, you are at ~37% EM (30% + 0.7 * 10%) and thus very close to a GDP weighting.

However, the ETFs themselves (such as $VFEM) are weighted according to market capitalization. So within EM you are not GDP weighted.

tl;dr: That wasn't meant as "too much", but as "you rarely see it on GQ".
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@G30G43BR4 Thanks for your feedback :)
Personally, I am leaning towards reducing EM holdings at a significantly higher price (may take a few years) and thereby realizing gains. If the correlation to All World and EM remains at a similar level of 0.66 over the last 11 years, this may well happen. (Speculative, of course).

I will continue like this and see where this approach will take me.

Thanks for the general feedback :)
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