3Mo·

Reallocation MSCI World to Invesco Quantitative Strategies ESG Global Equity Multi-Factor

I have decided to switch my MSI World shares into the $IQSA (+0,53 %) (Invesco Quantitative Strategies ESG Global Equity Multi-Factor UCITS ETF - USD ACC ETF, ISIN: IE00BJQRDN15).

Reasons:

I am convinced by the ETF's active management approach in view of the "stormy times" I expect in 2025 with lower costs compared to active funds
continued investment in the world equity basket with a different weighting of equities in the investment horizon in the three areas of value, quality and momentum compared to the MSCI World
I would like to reduce my risk with regard to the seven large tech stocks (which are currently too heavily weighted in the MSCI World but also in the FTSE ACW), as the share basket differs significantly
Good historical performance comparable to the MSCI World
Investments according to certain ESG criteria (sustainability is not my main goal, but I would like to invest part of my portfolio in this direction)
Disadvantage: additional costs (0.5 instead of 0.15), which in my view are not an obstacle to investing, considering the historical performance.

Have you perhaps already looked at this active ETF? How did you rate it?

18 Commentaires

Stulle 🥪@Stullen-Portfolio

3Mo

Joah, I also like the approach of avoiding the often so-called sediment in classic world ETFs and investing in a more focused but still broad-based way. That's why I also invest in $IQSA...as well as three other ETFs with the same objective.

Greetings
🥪

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Norbert G.@Commander_Scotty

1Mo

@Stullen-Portfolio I have a similar view and have been invested here for some time. Can you tell us which three are the others? 😊

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Stulle 🥪@Stullen-Portfolio

1Mo

@Commander_Scotty
Sure:
$XDEM
$GGRG
$JREG

...but you can also see it by clicking on my name 😉

Greetings
🥪

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Norbert G.@Commander_Scotty

1Mo

@Stullen-Portfolio Thank you! (P.S. Kniffte and Bütterken remind me of my first life... 😂😉👍)

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Stulle 🥪@Stullen-Portfolio

1Mo

@Commander_Scotty
Why is that, were you a baker? 😉

Greetings
🥪

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Norbert G.@Commander_Scotty

2Sem.

@Stullen-Portfolio No, but I was born in a world where you have to play like that!

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Christian@ChristianInvests

3Mo

I understand the concern about a crash, but I don't yet understand what strategy you are pursuing with your ETF investment. The idea of global ETFs, I would say, is to capture the average return of the global economy over a period of at least 10 years (especially in times of crashes to still achieve a positive return), more likely even longer.

As the MSCI World is regularly rebalanced by market capitalization, it does not need to be actively managed. The ETF you are now aiming for looks supposedly less risky because only 2 of the 7 major tech stocks are at the top of the list, but ultimately the ETF is also just under 70% US and just under 30% tech stocks overall in terms of sectors.

Then there is, as you say, the higher TER of 0.5%. Ultimately, this means you have higher costs without increasing your return. You said yourself that the historical performance is comparable. What makes you think that said ETF suddenly beats the market significantly with a relatively similar investment strategy?

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CKK@THE-ROCK-SAAR

3Mo

@ChristianInvests Thank you for your assessment. I am pursuing exactly the same goal that you describe above (taking global returns with me). So I'm not interested in significantly beating the market either. Maybe that came across wrong? But precisely because he is not fully invested in the seven main tech stocks, I have already reduced the risk from my point of view. So ultimately I would like to end up with a return similar to the MSCI Word. I just think that the MSCI World will fall a little further than this active ETF in the next few months in the event of a possible crash (after comparing the individual stocks in the two).

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Christian@ChristianInvests

3Mo

@THE-ROCK-SAAR The point is, if you have an investment period of 10+ years, it won't matter if a crash happens next month or not. The values will recover + there will be regular rebalancing just through the mechanism of the ETF. Therefore, in my opinion, your idea of investing now
to invest in an actively managed fund now.

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Christian@ChristianInvests

3Mo

@THE-ROCK-SAAR The other point is that your preferred ETF still contains 70% US equities. In the event of a crash, not only the MAG 7 stocks will fall, but the majority of US stocks. And with what knowledge do you know better whether the actively managed fund can assess this better?

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CKK@THE-ROCK-SAAR

3Mo

@ChristianInvests I don't know that, of course. You're right, but ultimately investing is always a bet on the future. I just see it a little differently to you. I have looked at the individual stocks. (there are around 170 in which the Invesco ETF invests), and I think the mix is incredibly good and in some cases quite conservative. It fits my risk profile well at the moment. I wasn't planning to further reduce my US share through this ETF (I already do that sufficiently through the overall mix in my portfolio), what makes you think that?
The costs for this active ETF are significantly lower than for an active fund with e.g. TER = 3%, but it still offers an investment in the global equity basket, a professional looks over the selection from time to time and it does not follow the MSCI World Index purely by algorithm, and that is important to me. 👍🏻 I think that if the index goes down and all the ETFs attached to it do too, I might come out a bit better if I differentiate myself from it to a significant degree with this ETF. But as I said, that's just speculation and simply my personal assessment. 😀

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Christian@ChristianInvests

3Mo

@THE-ROCK-SAAR You seem to know a lot about what you're talking about. With this knowledge, I definitely trust you to be able to make well-founded investments in individual stocks :)

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Korrekturensohn@Korrekturensohn

3Mo

You would have been better off building your own multifactor portfolio with an equal weighting of small caps, emerging markets and, if you like, value stocks

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CKK@THE-ROCK-SAAR

3Mo

@Korrekturensohn Thank you for your assessment. The ETF is only part of my portfolio. Basically, I follow an approach that goes in the direction you describe. With individual stocks and other funds. For example, I am invested in the frontier markets/emerging markets fund $QJYCS6, which is doing very well. In these markets, I prefer to rely on good fund managers who know their way around locally.

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