Advantages
Diversified - With this portfolio a maximum of diversification is achieved
Low risk - The reduced cluster risk lowers the vulnerability to regional/industry-related crises
Individual - The weighting can be adjusted according to taste.
Disadvantages
Elaborated - The effort increases when several ETFs are combined. Regular adjustments are necessary to obtain the ideal weighting.
Expensive - Depending on the transaction costs of your broker, the total costs increase. However, this can be avoided by choosing the right broker which allows to set cheap saving plans.
Difficulty | ⬤⬤⬤ |
Costs | ⬤⬤⬤ |
Security | ⬤⬤⬤⬤⬤ |
Individuality | ⬤⬤⬤ |
In order to reduce the proportion of the USA in the portfolio, a classic MSCI World, which covers all relevant Western industrialized nations, is combined with an ETF on Europe and emerging markets. As the World and Europe ETFs only focus on large cap stocks, a Small Cap ETF is added for additional diversification. An investment in gold is also a good option, yet you can save it and take it for the MSCI World instead.
All ETFs shown here are based on cost (low TER), volume and savings plan eligibility. There are additional alternatives to choose from, either distributing, ESG-screened or modifications of these products.
Security and diversification
Worldwide, the USA has a share of less than 25% in global economic output, but accounts for almost 60% in world ETFs. This means that "the world" is distorted in terms of the global economy. Our "global balance" portfolio aims to reduce this risk.
Global balance
Aiming to cover the world in the most effective manner.
50%
Industry Nations
Product: SPDR MSCI World
ISIN: IE00BFY0GT14
TER: 0.12%
Income Use: Accumulating
Fund volume: 1.9 billion
Positions: 1509
Currency: USD
Inception date: 02/28/2019
15%
Emerging Markets
Product: iSHares Core MSCI EM IMI
ISIN: IE00BKM4GZ66
TER: 0.18%
Income Use: Accumulating
Fund volume: 15.4 billion
Positions: 3195
Currency: USD
Inception date: 05/30/2014
15%
Small Caps
Product: iShares MSCI World Small Cap
ISIN: IE00BF4RFH31
TER: 0.35%
Income Use: Accumulating
Fund volume: 2.5 billion
Positions: 3472
Currency: USD
Inception date: 03/27/2018
15%
Europe
Product: Vanguard FTSE developed Europe
ISIN: IE00BK5BQX27
TER: 0.10%
Income Use: Accumulating
Fund volume: 3 billion
Positions: 1509
Currency: USD
Inception date: 02/28/2019
5%
Gold
Product: Invesco Physical Gold A
ISIN: IE00B579F325
TER: 0.12%
Fund volume: 13.5 billion
Positions: Physically deposited
Currency: USD
Inception date: 06/24/2009
Disclaimer
Investing in the stock market presents inherent risks. Penta Trading is not liable in case of capital loses or damages to their users. The information presented here represents exclusively the opinion of Penta Trading and it does not constitute a financial recommendation. Each user is responsible for the handling of their own assets and should exercise caution while trading in the stock market. This service is aimed exclusively at private investors. If you would like to use it for commercial purposes, we kindly ask you to get in touch with us. By using any of the services in this site or subscribing you declare you have read and accepted our Disclaimer as well as our Terms and Conditions.