US Small Caps - USML vs IJR [Brazil]

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Topic Author
hciboto
Posts: 10
Joined: Sat Jan 02, 2021 9:31 am

US Small Caps - USML vs IJR [Brazil]

Post by hciboto »

Hi folks, :sharebeer

Defining my US Small Caps ETF I found USML as a good dividend accumulation option.
My first option was IJR

So in your opinion regarding AUM, liquidity and etf rules, which one would be a better ETF allocation?
In an allocation of USD 600k the market maker would act to provide liquidity?

USML - Invesco S&P SmallCap 600 UCITS ETF - AUM USD 4M/ Avarage Daily Volume USD 130k
IRJ - iShares Core S&P Small-Cap ETF - AUM USD 68B / Avarage Daily Volume USD 509M


Thanks! :moneybag
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LadyGeek
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Re: US Small Caps - USML vs IJR

Post by LadyGeek »

Welcome! I moved your post to the Non-US Investing forum because you are referencing USD and "UCITS" is for non-US investors.

What is your home country?

May I suggest you post your portfolio information in this thread using the My portfolio: seeking advice format? It will make you think about the "big picture" while giving us the information we need to point you in the right direction.

If you have any questions, ask them here.

Update: I retitled the thread based on the post below (Brazil).
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.
Valuethinker
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Re: US Small Caps - USML vs IJR

Post by Valuethinker »

hciboto wrote: Thu Apr 15, 2021 7:37 am Hi folks, :sharebeer

Defining my US Small Caps ETF I found USML as a good dividend accumulation option.
My first option was IJR

So in your opinion regarding AUM, liquidity and etf rules, which one would be a better ETF allocation?
In an allocation of USD 600k the market maker would act to provide liquidity?

USML - Invesco S&P SmallCap 600 UCITS ETF - AUM USD 4M/ Avarage Daily Volume USD 130k
IRJ - iShares Core S&P Small-Cap ETF - AUM USD 68B / Avarage Daily Volume USD 509M


Thanks! :moneybag
The former looks far far too small to invest USD 600k in.
Topic Author
hciboto
Posts: 10
Joined: Sat Jan 02, 2021 9:31 am

Re: US Small Caps - USML vs IJR

Post by hciboto »

LadyGeek wrote: Thu Apr 15, 2021 7:46 am Welcome! I moved your post to the Non-US Investing forum because you are referencing USD and "UCITS" is for non-US investors.

What is your home country?

May I suggest you post your portfolio information in this thread using the My portfolio: seeking advice format? It will make you think about the "big picture" while giving us the information we need to point you in the right direction.

If you have any questions, ask them here.
I'm from Brazil. Thanks for the advice, I'll do that. :)
Topic Author
hciboto
Posts: 10
Joined: Sat Jan 02, 2021 9:31 am

Re: US Small Caps - USML vs IJR

Post by hciboto »

Valuethinker wrote: Thu Apr 15, 2021 8:00 am
hciboto wrote: Thu Apr 15, 2021 7:37 am Hi folks, :sharebeer

Defining my US Small Caps ETF I found USML as a good dividend accumulation option.
My first option was IJR

So in your opinion regarding AUM, liquidity and etf rules, which one would be a better ETF allocation?
In an allocation of USD 600k the market maker would act to provide liquidity?

USML - Invesco S&P SmallCap 600 UCITS ETF - AUM USD 4M/ Avarage Daily Volume USD 130k
IRJ - iShares Core S&P Small-Cap ETF - AUM USD 68B / Avarage Daily Volume USD 509M


Thanks! :moneybag
The former looks far far too small to invest USD 600k in.
Then the market maker wouldn't act to provide liquidity and in fact the average volume would not be a problem?
whereskyle
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Re: US Small Caps - USML vs IJR [Brazil]

Post by whereskyle »

hciboto wrote: Thu Apr 15, 2021 7:37 am Hi folks, :sharebeer

Defining my US Small Caps ETF I found USML as a good dividend accumulation option.
My first option was IJR

So in your opinion regarding AUM, liquidity and etf rules, which one would be a better ETF allocation?
In an allocation of USD 600k the market maker would act to provide liquidity?

USML - Invesco S&P SmallCap 600 UCITS ETF - AUM USD 4M/ Avarage Daily Volume USD 130k
IRJ - iShares Core S&P Small-Cap ETF - AUM USD 68B / Avarage Daily Volume USD 509M


Thanks! :moneybag
I've started buying IJR (I'm in the US if that matters).
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle
TedSwippet
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Re: US Small Caps - USML vs IJR [Brazil]

Post by TedSwippet »

whereskyle wrote: Thu Apr 15, 2021 2:53 pm I've started buying IJR (I'm in the US if that matters).
Absolutely it matters.

US tax laws for non-US investors are much worse than for US residents and US citizens, to the point where unless you have good tax treaty coverage (and Brazil has no US tax treaties), Ireland domiciled ETFs are the far better choice for non-US investors.
Valuethinker
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Re: US Small Caps - USML vs IJR [Brazil]

Post by Valuethinker »

TedSwippet wrote: Thu Apr 15, 2021 3:06 pm
whereskyle wrote: Thu Apr 15, 2021 2:53 pm I've started buying IJR (I'm in the US if that matters).
Absolutely it matters.

US tax laws for non-US investors are much worse than for US residents and US citizens, to the point where unless you have good tax treaty coverage (and Brazil has no US tax treaties), Ireland domiciled ETFs are the far better choice for non-US investors.
Just to clarify.

Poster, although a Brasilian national, lives in USA?

Therefore is tax resident in USA.

Therefore PFIC applies. Poster should under no circumstances hold a fund other than US domiciled? The tax consequences are awful.

With some countries, pensions may be an exemption, covered by tax treaty - funds and ETFs, non US, held within those vehicles. Alas in this case there appears to be no obvious exemption for Brasilian personal pension funds, held by a US resident?
TedSwippet
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Location: UK

Re: US Small Caps - USML vs IJR [Brazil]

Post by TedSwippet »

Valuethinker wrote: Fri Apr 16, 2021 9:50 am Poster, although a Brasilian national, lives in USA?
I read this post to mean "Brazilian resident" and non-US. I agree that there's wiggle room in it.
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