Testing ETF - how would you rebalance?

Again, I’m learning - so am happy to take advice. I’m willing to take a reasonable risk, realizing that the gains might not be as high but neither will my losses.

What would you do instead?

What loss percentage can you „accept“ meaning you wouldnt sell? What is your curremcy of reference - CHF? Are you willing to self manage or do you want a simple savings plan that is hassle free?

That is a difficult question to answer, understandable, but difficult. How would you evaluate? Given that it’s a bit like asking ‘how long is a piece of string’…

I can self-manage. CHF seems simpler seeing that I’m in CH.

As @TeaCup commented, you are suggesting putting almost 50% of your portfolio into commodities (crude oil, petroleum products, and metals). This is silly.

Although this exposure is obtained using a fund who themselves use financial derivatives you still pay an implicit roll yield in holding these positions (think theoretical storage, insurance, financing cost). In the long term this will cause significant value decay to your positions.

The BNP Paribus fund also seems to skim some nice fees off the top for their “work”.

Don’t bother investing in commodities. Consensus is that futures do not pay a long term “risk premium” like equities (although funnily enough some academics believed that they did pre-2008 during the last commodity supercycle).

FYI I work at a prop commodity derivatives fund and in my personal account hold almost entirely 100% VT (Vanguard passive global equities).

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It’s in total contradiction with your ETF choice where we have everything except CHF (i.e. 45% in a commodities ETF in EUR).

I would recommend you to read this page.

It will give you a good introduction to portfolio construction, assets and risk allocation.

Afterwards, you could fill in a questionnaire here or here.

It may help you determine the assets split between equities, bonds, commodities and real estate.

Think about ETF currency, distribution vs accumulation too. What do you want to achieve ? any restrictions ? having a core portfolio with a satellite portion for fun money/short term bet/direct line of shares ? An IPS won’t hurt at the beginning of your investment journey.

After these thoughts for mind, it’ll be easier to select your ETFs.

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If you don‘t know how much you are able and willing to put at risk; I won‘t be able to give you any Portfolio advice. The only thing I can tell you is that I am myself not willing to lose more than about 30% - hence I don‘t invest 100% in shares. What you propose with 50% shares / 50% commodities implies a loss potential of 50 to 60% at least. Thats quite a bit.

My proposal: go to truewealth and try out their advisory, then try to see how it feels for you to have money in the market. Implementation can be with truewealth or Avadis (they are a tad cheaper). If you want to trade yourself, buy an IE based Vanguard LifeStrategy with your equity share. Be conservative in your risk taking until the first crash; meaning if you think you could shoulder 80% shares; just take 25% less to be on the safe side.

After the first real crash - you will know. Either you are happy you were not that risky; or you then buy low as you scale your risk up. With crash - I don‘t mean the mini thingie we had a year ago but a 6+ month down-turn over multiple cycles.

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