I am 29 at the moment at looking to start investing as much as I can and build a long term portfolio (aiming at around 2000 USD/month). Since I am based in the EU, I have no access to US based ETF funds. Which means that I mostly have to do with whats traded on the LSE ETF exchange and located in the EU. That being said, I feel that at this age I can allocate almost exclusively to Equity and keep it that way for a few years. After a bit of research and playing with the Ishares Core Builder tool, I have came up with the following portfolio to start with.
EU Equity (iShares Core EURO STOXX 50 UCITS ETF EUR, CSSX5E) - 30%
US Equity (iShares Core S&P 500 UCITS ETF USD , CSPX) - 45%
Japan Equity (iShares Core MSCI Japan IMI UCITS ETF USD, SJPA) - 15%
Asia - Pacific (iShares Core MSCI Pacific ex-Japan UCITS ETF USD, CSPXJ) - 5%
Emerging Markets (iShares Core MSCI EM IMI UCITS ETF USD, EIMI) - 5%
I wonder if I can get some advice on the chosen funds as a basis for a diversified equity only portfolio. Any kind of feedback would be much appreaciated
So after a bit of reading and taking your points, I altered my allocation to look like:
- S&P 500 - 20%,
- S&P Mid Cap 400 - 15%,
- S&P SmallCap 600 - 15%,
- FTSE Developed All Cap ex US Index - 30%,
- MSCI Emerging Markets Investable Market Index - 10%,
- Bloomberg Barclays US Aggregate Bond Index - 10%
I think this should give me a pretty good diversification across most sectors. Maybe you have some remarks? What I wonder about however is the fact that I am unable to find a EU domiciled ETF that aims to track the FTSE Developed All Cap ex US Index... There is one that tracks FTSE Developed but that includes the USA. And since I already have significant exposure to US Stock, it does not work quite well. Also, its interesting to see that the expnse ratios of EU domiciled Ishares ETFS is quite higher than for their equivalents in the US. Is that something that should bother me much ? For example iShares S&P SmallCap 600 UCITS ETF, ER is 0.4 %.