Switch new contributions from IWDA to IVWL or VGWE

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NickG
Posts: 24
Joined: Tue Aug 29, 2017 3:28 am

Switch new contributions from IWDA to IVWL or VGWE

Post by NickG »

Hello.

I hold the popular iShares Core MSCI World + iShares Core MSCI EM IMI combination of ETFS (IWDA + EMIM).

The time has come to make a new purchase of shares and I find myself reluctant to buy IWDA at the current price. I am considering:

1. Not buying any IWDA for now
2. Bying Vanguard FTSE All-World High Dividend Yield UCITS ETF Accumulating (VGWE)
3. Buying iShares Edge MSCI World Value Factor UCITS ETF (IWVL)

The 2 ETFs have much lower P/E and a value tilt, which supposedly is a good thing over the very long term.

I realize that this is an emotional issue, but nevertheless, I can't help it. Hopefully you can help me avoid doing something stupid.
vstariradev
Posts: 53
Joined: Wed Nov 02, 2016 9:43 am

Re: Switch new contributions from IWDA to IVWL or VGWE

Post by vstariradev »

If it’s emotional then you better hope that emotion stays with you for decades.

According to some of Ben Felix’s videos on the topic, the benefit for value stocks (small cap value stocks actually) pays off slowly. He showed examples where an investor would be seeing underperformance for years compared to non-value before the pay off. Decide for yourself if you’re that kind of person. I’m not. There is much more evidence and support in buying IWDA+EIMI or VWCE than overweighing the value factor.
Laurizas
Posts: 250
Joined: Mon Dec 31, 2018 4:44 am
Location: Lithuania

Re: Switch new contributions from IWDA to IVWL or VGWE

Post by Laurizas »

I would go with option 3, but according to Cliff Asness - Factor Timing is Hard.
https://www.aqr.com/Insights/Perspectiv ... ng-is-Hard
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