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Msci world with ex usa

Hello, I have decided to include two ETFs in my portfolio: an MSCI World and an MSCI World ex USA. These two ETFs make up the largest part of my portfolio.

The MSCI World consists of about 70% US stocks, and since I am already heavily invested in individual US stocks, I chose the MSCI World instead of the S&P 500 to avoid too much concentration. In addition, I have chosen the MSCI World ex USA to further diversify.

Of course there are overlaps, but you also have to look at the weightings that each ETF gives to the individual stocks.

What do you think?

Would a combination of S&P 500 and MSCI World ex USA have been better, or do you think my more diversified solution makes more sense?

#Thanks for your advice!

$IWDA (-0,2%)
$EXUS (-0,16%)

11 Comentários

Patrick Schäfer@Hotte1909

There is still one with reduced us content. I'll see if I can find it right away. But it could also be that it was a Dekra fund. It was quite interesting in terms of its composition, with 5-10 stocks per country from the major industrialized nations and then small and mid caps by continent or something like that. In any case, it had a 15% US share.
Although I wouldn't actually underweight the USA. Of course, things are going pretty badly at the moment under Trump, but that won't matter over the next 10 years and will probably even give you an excess return

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Werner L.@capital_sherpa_1182

@Hotte1909 @GoldenShield @All-in-or-nothing @randomdude Thank you for your response to my comment. I have carefully considered your thoughts.

My view is as follows:
I am not particularly convinced of the potential of emerging markets - with a few exceptions such as China and a few other countries where I see concrete opportunities.
I have as little confidence in Africa as I do in the Middle East. For this reason, I prefer to focus on developed markets, adding some Chinese stocks where appropriate.

To avoid excessive overlap - as has rightly been pointed out - I have decided to replace the MSCI World ETF with the S&P 500. However, I will retain the MSCI World ex USA to ensure broader geographical diversification.
The weighting of these two ETFs will probably be split between around 60% US and 40% developed countries outside the US.

My strategy is geared towards the long term. I can't say today whether Japan, China or another country will grow more strongly in ten years' time.
I think that demographics are just one of many influencing factors: for me, it's the quality of human capital that counts most, not just the quantity. Of course, this is a personal assessment - perhaps Africa or another region that is underestimated today will become the growth driver of the future. But this is how I see things at the moment.

The rest of my portfolio consists of Bitcoin, Ethereum, a few thematic ETFs and around 20 carefully selected stocks from Europe and the USA.
Overall, my allocation is currently around 55% US (with an upward trend towards 60%), 25% Europe and the rest is globally distributed.

An additional concern relates to the proposed US legislation "Section 899 - Enforcement of Remedies Against Unfair Foreign Taxes", which would tighten the taxation of dividends and capital gains for foreign investors. Should it come into force, this could mean tax disadvantages for international investors in US securities - an aspect that I am following closely.

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Brody@Brody

@capital_sherpa_1182 The Treasury Department has already asked Congress to remove the Section 899 clause. So I wouldn't worry about it any more.

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All-in-or-nothing@All-in-or-nothing

@Brody The Ministry of Finance still exists?😅 Oh wait, that was the Ministry of Education, which was abolished and then not abolished after all (thanks to the judges Dank🙏🏻)

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All-in-or-nothing@All-in-or-nothing

@capital_sherpa_1182 S&P 500 + World ex USA makes much more sense from my point of view Sicht👍🏻

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Philip Buß@GoldenShield

I also like to make the mistake of thinking I have too much US in my portfolio, even though it's only around 50-55%
The biggest companies are American. I think Japan is quite high in the ex-US portfolio at 20%, which in no way reflects the economic performance if Germany is only represented at 8-9%. In addition, the MSCI World only invests in developed countries, which means that, unlike a "real" All World, you are already leaving out half of the world

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Dominik@Dominik_76

@GoldenShield According to a recent statement by Dr. Gerd Kommer, Japan's market capitalization and economic strength can account for around 6-7% of total investment in the global market.

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Philip Buß@GoldenShield

@Dominik_76 Japan is without question an important player on the global market. However, it is also the country with the fastest declining population, which means that future plans should be viewed with caution from a demographic perspective
Furthermore, I was only referring to the composition of the ETF. If the 🇯🇵 share is slightly higher than 🇫🇷 and 🇬🇧 together or 2.5 times 🇩🇪 then that can be a problem. Similarly with the Canadian share in the ETF. The problem with ETfs that invest in developed countries without the USA is simply that you run out of countries and companies

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Dominik@Dominik_76

@GoldenShield The distribution of countries in the ETF adapts to market conditions and the combination with an S&P 500 or MSCI USA leads to a "dilution" of the share. In the interview, Dr. Kommer put the special age argument in Japan into perspective. This applies to many countries. Japan is underestimated. But I can understand that you think that Europe could be underweighted compared to Japan. Then again an ACWI or FTSE all world. That also updates itself.

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All-in-or-nothing@All-in-or-nothing

It simply duplicates all stocks outside the USA, as the composition is otherwise pretty much identical (except for the missing US component). I would have opted for something else to complement the classic MSCI World, but to each his own Seine🤷🏼‍♂️😅.

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Golden Boy@randomdude

Maybe $TSWE would be something for you? This is the equally weighted world ETF from vanEck. Has less than 40% USA exposure.

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