Yesterday and today I was able to expand my ETF positions a little 💪
Additional purchases were made 🙋♂️🤗⚠️
What do you think of this ETF and do you have it in your portfolio?
Invesco MSCI World ETF
ETF
ETF
ISIN: IE00B60SX394
Ticker: SC0J
IE00B60SX394
SC0J
Price
Discussione su SC0J
Messaggi
11
2Mes·
Multiple ETFs on the same index are always questioned here, but can make sense under certain conditions and financial planning.
The 3 times 10 rule is explained in the article (link below)
If we take this as an example, why not always invest an ETF not for 10 years but for a certain € amount (based on the purchase prices). So why not look for a new one every 10, 20 or 30 thousand euros?
Wouldn't that also make sense?
Well, when you retire it looks wild in the portfolio, but does this actually correspond exactly to this tactic?
What do you think? I do it exactly the same way with one share, for example: set a € limit and then build up the next positions.
Constructive or bullshit?
https://www.finanztip.de/daily/so-holst-du-28000eur-mehr-aus-deinem-etf-heraus/
www.finanztip.deSo holst Du mit der Finanztip 3×10-Strategie das Maximum aus Deinem ETF
1111
28 Commenti
@DonkeyInvestor What do you mean? You have also included another world ETF, albeit for other reasons as you said
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22
•
1Anno·
Moin,
have now thrown off some ballast. To be continued.
Would you expand already existing positions in the portfolio and thus remain with 3-4 titles or go new ways?
I find the following ETFs not uninteresting:
$IE00U7L59A3
Please comment on the selected ones.
What pros and cons can you give?
Thank you very much for that!
Can you recommend certain ETFs in addition or independently of those mentioned?
What have you done well with so far and why?
Please give a short explanation.
My goal is buy and hold. Investment period >10years, more likely 15.
Risk tolerance=high
Investment amount ca. 15tsd €
P.S. I have actually already decided to increase my existing positions.
P.P.S. Thanks to all for the patience and support in linking!
11
1 Commento
1Anno
So first of all, you should do yourself a favor and look at how many duplications you have in your ETFs, because they basically have the same basis and add a few stocks. For most of the mentioned, this is the MSCI World, this is supplemented in the ACWI and in the FTSE All-World by various stocks mainly from the emerging markets, so you have here already four times the same basis in your selection I would recommend you to limit yourself to one of them to avoid unnecessary duplications.
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66
•1Anno·
Moin,
have now thrown off some ballast. To be continued.
Would you expand already existing positions in the portfolio and thus remain with 3-4 titles or go new ways?
I find the following ETFs not uninteresting:
$IE00U7L59A3
Please comment on the selected ones.
What pros and cons can you give?
Thank you very much for that!
Can you recommend certain ETFs in addition or independently of the ones mentioned?
What have you done well with so far and why?
Please give a short explanation.
My goal is buy and hold. Investment period >10years, more likely 15.
Risk tolerance=high
Investment amount ca. 15tsd €
P.S. I have actually already decided to increase my existing positions.
P.P.S. Thanks to all for the patience and support in linking!
44
27 Commenti
Small tip: If you make a blank line between the ISINs the link appears 🙏🏼 then it is easier to answer your question 😊
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1010
•
3Anno·
Opinione per $SC0J
🤷♂🤷♀️ NeutroWhy the structure of an ETF makes a difference in the long term. I'm picking up a post of mine from the other day, since I think some people here are not yet that deep into the subject.
The MSCI World from Invesco is for me a good product, apart from classic USA Equity Indices, where the topic 871m and synthetic offer a decisive advantage.
There are 3 (probably more) different ways to structure an ETF.
1) physical - i.e. ETF holds all stocks of the index
2) swap based - lower withholding tax rates
3) swap based - net performance + "guaranteed" swap spread.
re 1) physical ETFs on US Equity primarily deliver outperformance through lower withholding tax rates you are subject to than those assumed for the Net Return Index (NTR). Namely, the NTR assumes a 30% withholding tax rate due to withholding tax treaties. I.e. this NTR is the benchmark for the performance here.
By clever choice of domicile, e.g. Ireland, physical ETFs improve to 15% withholding tax and perform the NTR quasi by this 15% withholding tax advantage - costs then out.
2. swap-based ETF with a "gross minus" model
Outperformance is achieved because the swap counterparty has lower withholding tax rates than the NTR (30% withholding tax deduction). However, Invesco's S&P 500 tracks the performance of the gross index i.e. including 100% of dividends and has negotiated a 0% withholding tax rate in Ireland. I.e. the client gets 100% of the dividends - cost (0.05%).
Outperformance to the NTR are then for example.
Dividend yield: 1.50%
Withholding tax improvement: 1.50% x 30% (withholding tax savings) = 0.45%.
subtract costs from this: 0.05% = 0.40% better performance than the NTR.
By the way, Invesco does the same for MSCI USA and on the US exposure in their MSCI World (IE00B60SX394), which is still 60% of the index.
Therefore, Invesco's MSCI World is one of the best performing MSCI World ETFs.
The difference between the physical and the swap model are then with assumed dividend yield of 1.5%.
1.5% x 15% withholding tax = 0.225%.
The outperformance depends on the dividend yield in the index.
3. swap based ETFs can also outperform the NTR by improving the performance via the swap or "negative swap fee". The amount of this "better" performance depends on the withholding tax rate and the financing costs of the swap partner. The swap partner then says e.g.: ETF provider, I will deliver you an outperformance of 20 basis points (=0.20%) to the NTR. Disadvantage: Dependence on the swap partner = intransparent! Providers like Xtrackers, Amundi or Lyxor use this model.
Swappartner says then simply, I deliver to the NTR + 0.15% outperformance over the swap and you get then. But is just not safe and not transparent ...
Hope that helps one or the other further and eyes on when choosing the right MSCI World.
If there are answers here because of swap security etc., there still a sentence to: Invesco drives a physical approach with swap overlay, i.e. the equity ratio of the ETF is somewhere at 96-98%. Whereas with some physical ETFs, securities are lent from 0-70% and there you will only find an equity quota of 50% in the conditions. With the lent securities one does not even know who owns them. Therefore, I would always prefer a better performance with swap structure, if the physical counterpart can not keep up with the performance.
1010
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