As long as they have biggest military, there is no chance of going bankrupt. You can always take stuff from others when you have power
Part 1 -: take 50% of Ukrainian natural resource revenue for the “protection” promises or maybe even without any promise
Talking about pure financial part for expected returns from US markets
Is there any research if stock markets in democratic countries do better than authoritarians or there is no evidence either ways?
US is underperforming the ex/US this year though. Maybe there is a bit of selling going on
VTI YTD returns 3.6%
VXYS YTD returns 7.4%
I don’t know but you’d expect that having strong rule of law and protection from arbitrary expropriation would be advantageous.
For foreign investors: yes. Domestic investors, he can’t.
US people also need to worry about civil forfeiture and eminent domain issues.
I did not see such a consensus. VT has a much higher exposure to US political risk.
Not only does one own a 100% direct legal exposure to the USA, but also will sanctions impact the 35% international exposure held by the fund.
VWRL, on the other hand, only indirectly exposes 65% US stocks to sanctions.
And splitting VWRL into VTI+EXUS+EIMI gives you the option to switch indirect to direct exposure in the USA.
Completely agree here.
I think if you can manage it easily and can handle it behaviorally (different funds performing differently causing stress etc), then splitting it up, like you mention, is the prudent thing to do.
I‘d also encourage most to add some amount of home bias (i.e. 10-20% SLICHA), and you are set.
The only truly expropriation-safe funds/securities are local funds with lical securities, and also comes with a variety of other benefits (tax treatment, currency effects, etc.)
This would be generally advisable anyway imo, regardless of current situation.
Anybody started to think in the last few weeks to move their UCITS funds from IBKR to a Swiss or European broker?
I am thinking about switching from VT to UCITS continuosly. Not only in the context of Trump turmoil, but also as a shield for estate release in case of sudden death. The current turmoil is yet another argument.
If one thinks rationally, cutting off foreign investors in the US market would be a very bad thing to do for valuations and is likely to follow by a panic. There is no rational benefit for the rich in the U.S., neither for the common folks. Not very likely to happen.
But still, international investing carries these risks. I am sure we will be presented with scary things related to this in our investment carriers.
Turn out the noise? Might be best thing to do. On the other hand, it’s difficult and monitoring this type of risks might be rational.
I’ll se how it develops in the coming months. No action for now.
My DCA on VT has basically stopped and now I transformed it in 70% VWRL and 30% others. I’m thinking to switch from VWRL to WEBG just to move away also from Vanguard, but with WEBG apparently I’m risking more so ¯\(ツ)/¯
FWRA is a good option too
I am thinking of slightly different approach.
Move my US domiciled ETFs to Swiss Broker ( post Finance / Swiss quote), and start / keep buying UCITS at IBKR.
The thinking is more in context of estate tax issue (IRS documentation and potentially blocked funds) and not in context of anything that Trump may do.
Personally I stopped buying US ETFs about an year ago. All my new investments since then have been in SPDR ACWI or WEBG. This was because of estate tax drama. Over time I will also convert the older VT positions into UCITS.
I also have a two broker strategy since then and have IB + Swiss broker. This was for broker diversification.
At this moment , I don’t know if having US broker or Swiss broker would make much difference to mitigate/manage US govt related risks. Are you thinking from sanctions perspective ?
9 posts were merged into an existing topic: Estate tax treaty US-Switzerland [2024]
I only had a small position in VT, which I then liquidated last November and bought instead:
Right now, I would probably feel a lot more uncomfortable had I moved everything to VT last year. The 0.1% underpeformance is something I accept gladly.
5 posts were merged into an existing topic: World portfolio using UCITS ETFs: discussion [2024]
Maybe you can check Xtrackers (German) as well; as replacement for VTI I will probably use XD9U, but for now, I will continue with VTI.
5 posts were merged into an existing topic: Synthetic and swap-based ETFs
I’m honestly worried about the US situation and being almost fully invested in VT. I used to follow the “VT and chill” approach… but now the chill is gone… and I have no idea what to do. It seems like the consensus here is now FWRA, right? But I’m also scared of selling all my VT for FWRA because I feel so naive