With all respect (and these are not empty words), but this is exactly a kind of posts that we don’t need here.
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Because of useless politics 
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I predict markets will go down a bit when the result of the US elections are clear, because the thing that is a bit bad for business will most likely go into effect now that person has been elected, but then will go up again, because markets don’t like uncertainty and the uncertainty of who will be the next US president will be over.
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And, by the way, Christmas rally seems to be one of the most reproducible seasonal patterns which even has some justification (people spending on presents). We are heading into that period.
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Exactly, whoever wins, there’s likely to be the bump from the removal of uncertainty (assuming no accusations of stolen elections) and bump from Christmas.
I’ve kinda been waiting years for the melt-up to come, and maybe finally this is it:
- Election over
- Fiscal spending up (whoever wins)
- Monetary policy loosening (maybe)
- Christmas boost
- FOMO
I anyway plan to sell any Christmas boom to liquidate funds that I will use to fill my pension pot.
Maybe I have an error in my thought process, but just economically speaking wouldn’t the “promises” of Trump make the US better? I’m heavily invested in the US, so I have to convince myself positively 
He “promises” to reduce the federal corporate tax rate to 15% (for companies that produce in the US) without the concern that another country will outcompete them on taxes. This is because the US (Janet Yellen) played a pivotal role in the introduction of the OECD minimum corporate tax rate of, you guessed it, 15%. The US has not ratified this agreement, unlike other countries like Switzerland.
Let’s assume he will do it. For companies, relocating to the US would be a much better option. It offers lower taxes, the largest stock exchanges, a huge domestic market, ease of doing business is better, and less regulation.
Trump plans to introduce tariffs of 10%. In my view, it’s more or less just a lever so that other countries have to invest in the US to get those tariffs removed. Let us export stuff into your country, and you can sell stuff in ours. China, India, and others are doing something similar. You want to sell the stuff here, well, produce (invest) in our country.
All those policies are “anti-globalization” and pro-USA, but what else would one expect? Finally, it’s easier to promise than to actually implement those things…
Over long run such policies would make working with US “necessary evil” and it’s never good for the economy over long term.
You cannot force other countries to invest in US by threat of tariffs. This in personal world would be called extortion. Who likes that? Only the people who are exercising extortion
In my view - if Trump wins, and he does go through punishment of Europe and China, it might not be good for US in long term , but it would be good for world as it would force other Centers of power to be more collaborative -: China, India, Rest of Asia, Europe, Middle East etc.
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Well, in case he loses that’s exactly what we’ll get.
Being risk averse, I sold all my VT and bought VTI+VEU instead to reduce US weight in my portfolio.
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If he slaps 10% import duties on all other countries as promised - and 60% on China - they will slap similar tariffs and we have a trade war.
I’m not clear why there is not more panic in the markets about this
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Because everything politicians say is not really what happens. To win elections simple things are said so that it’s easy to remember. The fine print comes in real regulations
Let’s remember one person is not running the country. Republicans don’t say much as they want to win. But when they do win,they are not going to do insane things
To be honest if US wants trade war with everyone, it’s good that it happens sooner than later so that everyone can understand how much they should support USA in geopolitics.
On side note -: this is a reminder that having 60% exposure to US stocks might not always be the best strategy. It might be best for returns but it exposes the investor to one country quite significantly. It’s okay for Americans but not sure it’s good for ROW. I am starting to think if Ben Felix (33% x 3 approach is actually quite wise)
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I assume that’s 33.3% CH / 33.3% US / 33.3% DM ex-US + EM?
That’s actually quite easy to approximately reproduce with 32% SPI + 68% FTSE All-World, with the latter adding 1.5% CH, 42% US and 26% DM ex-US and EM.
Ben felix recommends this for Canadians
1/3 Canada
1/3 US
1/3 ROW
So for Swiss investors it would be mix of CHSPI / VT / VXUS or CHSPI/VTI/VXUS but indeed can be implemented using CHSPi/VT for simplicity even though not completely 3 x 33%.
Having said that I think country level exposure should be reviewed at portfolio level across asset classes. Not just equity.
I actually think that most of European wealth managers don’t have 60% US exposure. It might be mainly popular amongst retail investors who like one fund approach to keep such high focus on US
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If you are talking about mitigation against the risks of an international trade war then I am not sure filtering out “stocks with primary listing in US” will give robust protection. Multi-nationals with international sales and supply chains would suffer regardless whether their primary stock market listing is in USA or Germany. Companies with local sales and supply chains be better off in relative terms.
It would be a different story if capital controls were put in place (restrictions on foreign investors owning US stocks). Given his tendance to boast I don’t think he would like to preside over the crash in the US stock market that would cause, but who knows…
Actually I am just talking about how exposed individual investor be to one country.
Even though revenue of US companies might come from overseas as well, the valuation , regulation, taxation, other local laws are typically regional.
I am not sure how many non-US companies are listed in US and are part of VTI but I would expect majority of VTI revenue is coming from actual US companies
It’s US , so it gives a bit of comfort because USA has been ally of Europe. But imagine if it were China who had 60% of global market share , would investors still feel the same.
Hmmm. Care to share a scenario where you think such items might be more favourable to someone owning shares of (say) Unilever as opposed to Procter and Gamble ?
I think both companies would both be subject to similar US taxes and regulations on their US business
I think for individual companies it depends a lot on where they operate. Unilever and P&G are very global and have their sales across the globe. I don’t think there would be much difference in terms of impact if tax law in US change. But I think impact could be if market valuation changes
you can already see P&G & Kraft Heinz trade at much higher PE versus Nestle & Unilever. Why is that? I think it’s because investors in general are more bullish on anything that is American. If US goes into a debt crisis , this would change the valuation game for every company in US irrespective of where they do their business.
Point is that nothing drastic needs to happen. If S&P 500 multiple falls from 24 to 16 which is also a very reasonable multiple, the returns for investors would be not so great.
How do you plan to define the weight of each of these ETFs in the future?
This is a point people need to realise. These companies could drop to that level at a moments notice doing -30-40%, 16/17 p/e is the historic mean.
And it‘s not like those are super low p/e s.
It‘s roughly also where ex-US developed trades at right now.
People just assume the gravy train of the US will keep on chugging along for the forseeable time.
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I guess most people on this forum ignore the noise and just DCA into VT/VWRL/WEBG etc. as recommended.
Personally I think people here (looking at some of the latest threads) tend to treat their investing also as a hobby and implement an active strategy with passive intruments based on their beliefs and market expectation.
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