Upgrading to the "Weltportfolio" by Gerd Kommer

Thanks @hedgehog and @Bojack. I’ll rethink this. I’d still search for a way to integrate small-caps into my portfolio though, just not with such an overweight. Or is this a bad idea?

You can buy VT ETF - it includes all caps from most countries with market cap weight.

Can I buy VT when I’m not with IB? I’m currently at Strateo

hey @Leap,
i am more on the small/value-tilt side than others here in the forum, as you can see with my portfolio.
To me it’s bot valid to say

  • keep it simple: VT, or
  • i’d like to participate in the small/ value premium and hence do a bit of weighting.

the latter imposes a loooong investment horizon, 20y+, and insignificant trading costs increase relative to simply VT.

I found for myself that that the trade-off between picking value stocks (i.e. value -ETF) and hence losing diversification vs. the whole market is often an argument against.

1 Like

Thanks @nugget
I’d consider the simplicity of VT but I thought it wasn’t (easily) available to Swiss investors. Also I can’t seem to find it on justetf.com. I know that some people here on the forum have it but I thought that they all were with IB which I’m not.

Right now I’m torn between going with VT from now on (if available) or adding my above mentioned Small-Caps ETFs for around 10% of my portfolio, though it’d complicate things as I’d have 4 ETFs to manage…

There is an equivalent to VT in Europe, the SPDR MSCI ACWI IMI UCITS ETF but it has a TER of 0.4% so quite a bit more than VT. It did outperform the more popular Vanguard VWRL though (which is missing the small caps) since inception.

Alternative way to reproduce VT is to combine:

HSBC MSCI World UCITS ETF USD with 0.15% TER
iShares MSCI World Small Cap UCITS ETF with 0.35% TER
iShares Core MSCI Emerging Markets IMI with 0.18% TER

If you do this mix according to market cap weight, you should land at an effective TER of ~0.16-0.17% but you’ll have to rebalance yourself and transaction costs will add to your effective expenses.

2 Likes

Ok thanks, I’ll look into it.

for the part of administering 4 funds, i made my robo advisor that you can make a copy of. it’s based on google finance. it takes care of the rebalancing. of course, the purchases you still have to to :smiley:

4 Likes

VT can only be bought at IB or Degiro. I think Degiro said they were going to remove VT but people still seem to be able to buy it.

Something to consider: The MSCI All-World index has a lot less stocks than the FTSE equivalent (VWRL). e.g. 1800 vs 4000.

So even if past performance was similar, combined with the TER 0.4(MSCI) vs 0.25(VWRL), makes me favour VWRL. More diversification, cheaper, and better tracking difference in the past.

1 Like

MSCI ACWI IMI consists of 8880 constituents as opposed to 3185 of the FTSE All-World, since the FTSE All-world does not have any Small Caps.

MSCI World + MSCI World Small Cap + MSCI EM IMI = 8880 constituents with an effective TER of 0.16-0.17% if you mix 3 ETFs to achieve that.

Vanguard VT consists of 8000 holdings. On the other hand, VTI + VXUS will give you around 10000 holdings and an effective TER of 0.07%.

1 Like

i can find it with swissquote too, but since i am not a client, i dont know about buying it there. cornertrader for sure has it too, i had VBR (US small value) with them

Sorry yes, VT should be tradeable with most swiss brokers. I had it confused with europe, where brokers started not offering some US securities due to regulations concerning KIID documents.

and sorry i forgot to point out that justetf.com shows a set of ETFs that has nothing to do with what is available in switzerland :slight_smile:
on the webpage they say “ETFs approved for sale in europe”, maybe vanguards US-domiciled funds dont. but then, should i be able to buy them in UK? :thinking:

Ah thats good to know :smiley: I just figured out that I can indeed buy VT through my broker (Strateo). I also learned that it comes with a bit more work on the tax-front as I need to fill in two different forms to reduce the taxes imposed.
Is there any disadvantage that I haven’t thought about yet when buying VT (an US fund) through a Swiss broker (Strateo) ? Still kinda insecure as most of you are with IB.

find most important tax stuff here
the three dominating differences (afaik) with swiss brokers are

  • the trading fees are 2 orders of magnitude higher
  • if you are unlucky your broker is not “qualified” and can’t issue the w8-ben (15% reduction on us witholding tax)
  • you pay stamp tax 0.15% on top of commissions

there are a few others, but these are the prominent ones

2 Likes

Alright thanks. I’ll contact my broker to ask if they qualify.

Strateo does not qualify for W-8BEN if anyone wondered.

Does anybody know how to balance those three? Is there some updated data available somewere? Ideally directly from MCSI…

Yes, look here:

1 Like

Thanks. I think that should actually be pinned, and even documented over in our and Bogleheads wiki… Seems like very useful and important information.

By reading and partipating to this forum, you confirm you have read and agree with the disclaimer presented on http://www.mustachianpost.com/
En lisant et participant à ce forum, vous confirmez avoir lu et être d'accord avec l'avis de dégagement de responsabilité présenté sur http://www.mustachianpost.com/fr/