Do you understand the concept of correlation?
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What are the good option strategy for Low risk monthly income?
- Thread starter troubled soul
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This is exactly what this portfolio is made for
To diversify across different countries
in your imagination 😕
For example:
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@JohnnyDoe ”“ Your #1 Source for Guidance in Different Offshore Fields
Why should I care about correlation
I suggested a diversified portfolio that brings passive income.
I would not bet on China, Brazil, India
Even though I know they are going to make alot of money
I'm more comfortable with the west.
Because high correlation = high risk
high correlation = not diversified
good luck
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@JohnnyDoe ”“ Your #1 Source for Guidance in Different Offshore Fields
Do you think that all of them would fail?
USA + Europe
It is impossible!
Voo
In the last 30 Years, the Vanguard S&P 500 (VOO) ETF obtained a 9.95% compound annual return
Historical data of the CAC 40 index
The index returned an average annual return of 7.90% between February 1991 and April 2023.
Historical data of the DAX index
The index returned an average annual return of 4.58% between January 1999 and January 2023.
Historical data of the AEX index
The index returned an average annual return of 12.90% between March 2009 and April 2023.
Only Bel 20 (Belgium) I wad wrong about this one. Avoid it.
Last edited: Jul 31, 2023
@JohnnyDoe has a point.
Your portfolio is not diversified since all of these markets are highly intertwined.
I agree that developed market exposure is, if we go by the textbook, more risky. But current valuations do not justify that traditional point-of-view.
However, more important is to add some bonds (direct or through ETF/mutual fund, depending on the size of your portfolio).
Always note: Past performance is not indicative of future performance.
Last edited: Jul 31, 2023
4 countries not diversified enough?
Do you think they could all collapse?
If you buy only Voo. It is enough.
USA rules and will keep ruling for the next 100 years. No one can change that.
Indeed!
Aside from that, true diversification goes by asset class.
A slow but steady demise.
That's what all empires said and believed when they where's at the top.
You seem to be very enthusiastic, which can easily lead to disappointment.
Etf is simply investing in the whole economy of a country. You simply have to believe in the country you bet on.
I learned a very important rule in the world of finance;
if you want to understand the economy, you should first understanding politics.
I am not enthusiastic at all. I came here to present facts. But because you hate the west like many members here. That's why you disagree.
Brics will fail and disappoint you
You don't need 100 years, do you?
Forecasts matter only related to your remaining life expectancy:
" Remaining life expectancy without physical limitations applies to the number of years one is expected to live without any limitations in hearing, vision or movement. Remaining life expectancy in good self-perceived health is an estimate of the number of years one can expect to live in good self-perceived health. "
Say you are in your 40s, the relevant question is: Will the US economy/growth significantly collapse compared to the other markets over the next 30 years? Most probably not.
JEPI returned in 5 years less than VOO in one. Any reason to buy that I don't understand? (Open question, I see JEPI everywhere on the forum but don't get it)
JEPI hasn't been around for 5 years. So not sure what you mean. Also look at the real returns of both (including dividents). Finally, it may not be worth investing until you understand the purpose of the fund. There is a jepi group on reddit that may be of interest.
Wow.. I can only suggest you take one of the many (free) courses you can find on internet/YouTube about correlation.. so many (objectively)wrong things in your statements and you seems sure of yourself so I won't try to make you change your mind (but basically all reactions you received already are legit, your diversification is not a real diversification and makes your whole portfolio having a very risky profile), this process has to be done by yourself once you do your homeworks
Not bad but you would have done better 50/50 SCHD/VGT, similar max drawdown but more total return.
Agreed
I have been there before
This year QQQ which is tech etf made 40% return and has historically made more returns than VOO
But 20% of QQQ holdings are Apple and Microsoft which is too risky.
Therefore I would go for Voo because its holdings are diversified
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