How do you invest?

[Brazz 412]

ETFs 

[Wise Counsel 86]

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Edited May 25, 2021 by Wise Counsel

[NarNumbers 193]

14 minutes ago, Wise Counsel said:

 

 

 

Yeah, I can see that we both have very similar approaches in general and what you're doing overall is great.

 

Your ETF approach is very good. Beyond the S&P 500 ETF, Jack Bogle who is the founder of Vanguard (created VOO, VTI, etc.) argues that it is actually not really necessary to diversify on a global-basis. He claims that investing globally could help to avoid country-specific risk, but then it also exposes you to different types of risks such as forex, political risks, etc. In the S&P 500, around 40% of the company revenues are from outside of the USA due to the presence of multi-nationals and the dollar is used by almost every country, so there is natural diversification already happening. What you are doing is fine though, you will still probably get 8-10% over the long-term, but it is important to keep what he is saying in mind.

 

In terms of dividend vs. growth stock, I would encourage you to move more towards dividend stocks over time as these tend to be value stocks. As you said, they will give you very stable cash flow and you will buy them at a reasonable price, so there is more potential for greater long-term returns at a lower risk. Growth stocks are also good if they

 

For real estate, have you considered buying a REITs? This a more diversified approach compared to buying a single property and managing it yourself (which is also more time consuming and less liquid). There are different REIT ETFs out there that exist, which have performed extremely well.

 

For BTC, what you are doing is very good. Not more than 5% of your total net worth is recommended as this is an alternative investment and is highly speculative in nature.

 

Thanks for your feedback.  You have a very good point regarding the S&P vs diversifying on a global-basis. I will take that into consideration when balancing my portfolio in the future!

 

Yeah I do have REITs as well, forgot to mention. I do 100% agree with everything you said as well. It's more of a personal thing for me owning my real property vs a REIT but I find actually being able to walk into the house/condo and having a physical place you can say it's yours meaningful, but then again that's just my own personal view. Also one day If I want, I could move into the condo/house itself.

 

 

 

Edited April 4, 2021 by TheEggMan

[Wise Counsel 86]

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Edited May 25, 2021 by Wise Counsel