International Lifestyle: I'm currently a UK resident, but a EU country citizen. I plan to move back to mainland EU soon (in 1 year?).
Currency: GBP
Emergency funds: Yes, in regular checking account.
Debt: No
Age: 30
Desired Asset allocation: 80% stocks / 20% bonds. I'm open to risk, I can sleep with no problems if the investments go down for an extended period, I don't need the money right now.
Desired allocation to stocks outside your of country of residence: Not sure. I prefer not to be too exposed to the UK, as my salary is already in GBP.
Current total portfolio: Low six figures
Also, if you know the details of any state pension(s) you are entitled to and you wish to add them here, this can improve the accuracy of the replies you receive.
I have a private pension in addition to state pension. Should be around low six figures (I think it's invested in BlackRock target plan 2055). My contributions + employer matching should be around 20% of yearly salary. I'd rather not mess too much with the private pension as it's quite an hassle, and I don't want to have a complicated set up in case I need to move it across countries.
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Current investment portfolio.
In regularly taxed account
27% cash
In the ISA
24% Total of 8 single stocks I picked
15% Vanguard Lifestrategy 80 (0.22%)
15% UBS S&P 500 (0.10%)
9% iShares physical gold (0.15%)
3% Ishares clean energy (0.65%)
3% Vanguard lifestrategy 60 (0.22%)
2% L&G battery value chain (0.49%)
2% Vanguard lifestrategy 100 (0.22%)
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New investments
New annual Contributions
Low 10s of k General investment account (Amount invested annually into your taxable account, in the currency indicated above)
20% of salary Retirement savings account (Amount invested annually into your tax deferred account, in the currency indicated above)
20k (ISA limit) Sheltered investment account (Amount invested annually into your tax free account, in the currency indicated above)
"I don't know what this is" Insurance investment account (Amount invested annually into your insurance account, in the currency indicated above)
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Questions:
Right now my portfolio is a mess. I have a lot of entries, and it's unclear why I have them.
I didn't have a strategy for the funds I was buying, I just wanted a good exposure to the US as I believe that is a market that is going to grow in the future.
In November I picked a few stocks that I believed were heavily impacted by covid, but had a solid business, would have a good future once things reopened, and had a low risk of going under if the pandemic lasted a few more months.
The reason for the high cash amount is that I didn't have a strategy, so I simply didn't invest in anything.
The investments in battery and clean energy is because I believe these to be 2 sectors that are going to grow a lot in the next 10-15 years.
Following the advice on this forum, I'm thinking to commit to the following asset allocation.
I think it's a fairly standard allocation, except for 15% of the equity allocation that is allocated to a less diversified fund.
Code: Select all
+------------+--------------------+----------------------+--------------+--------------------------------------------------------------------------------------------------------------------+----------------------------------------------------------------------------------------------------------------------------------------------------------+
| | | | Final weight | Fund/ETF(OFC) | Link |
+------------+--------------------+----------------------+--------------+--------------------------------------------------------------------------------------------------------------------+----------------------------------------------------------------------------------------------------------------------------------------------------------+
| bond 20% | | | 20.0% | Vanguard Global Aggregate Bond UCITS ETF GBP Hedged Income (0.10%) | https://www.morningstar.co.uk/uk/etf/snapshot/snapshot.aspx?id=0P0001HSBN |
+------------+--------------------+----------------------+--------------+--------------------------------------------------------------------------------------------------------------------+----------------------------------------------------------------------------------------------------------------------------------------------------------+
| | | US 60% | 40.8% | Vanguard U.S. Equity Index Fund GBP Inc (0.10%) or Vanguard S&P 500 UCITS ETF GBP (VUSA, 0.07%) | https://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F000003YD8 or https://www.morningstar.co.uk/uk/etf/snapshot/snapshot.aspx?id=0P0000WAHG |
| | +----------------------+--------------+--------------------------------------------------------------------------------------------------------------------+----------------------------------------------------------------------------------------------------------------------------------------------------------+
| | | Developed Europe 20% | 13.6% | Vanguard FTSE Developed Europe UCITS ETF GBP (0.10%) | https://www.morningstar.co.uk/uk/etf/snapshot/snapshot.aspx?id=0P0000YWUQ |
| | diversified 85% +----------------------+--------------+--------------------------------------------------------------------------------------------------------------------+----------------------------------------------------------------------------------------------------------------------------------------------------------+
| equity 80% | | Pacific 15% | 10.2% | Vanguard FTSE Pacific ETF (0.08%) I'm not sure if this exists on the LSE or in GBP | https://investor.vanguard.com/etf/profile/overview/vpl |
| | +----------------------+--------------+--------------------------------------------------------------------------------------------------------------------+----------------------------------------------------------------------------------------------------------------------------------------------------------+
| | | Emerging 5% | 03.4% | Vanguard FTSE Emerging Markets UCITS ETF USD Distributing GBP (0.22%) | https://www.morningstar.co.uk/uk/etf/snapshot/snapshot.aspx?id=0P0000WAHG |
| +--------------------+----------------------+--------------+--------------------------------------------------------------------------------------------------------------------+----------------------------------------------------------------------------------------------------------------------------------------------------------+
| | long term bets 15% | Battery/Renewables | 12.0% | L&G BATTERY VALUE-CHAIN GO UCITS ETF GBP (0.49%) and ISHARES II PLC GLOBAL CLEAN ENERGY UCITS ETF GBP DIST (0.65%) | https://www.morningstar.co.uk/uk/etf/snapshot/snapshot.aspx?id=0P0001CLRJ and https://www.morningstar.co.uk/uk/etf/snapshot/snapshot.aspx?id=0P0000956B |
+------------+--------------------+----------------------+--------------+--------------------------------------------------------------------------------------------------------------------+----------------------------------------------------------------------------------------------------------------------------------------------------------+
2. Is there a way to simplify it? Especially for the "Diversified Equities", is there a fund that already does the US/EU/Pacific/Emerging split above (or something similar)?
3. Considering I plan to move to a country with EUR as currency soon (1 year?), should I invest in EUR denominated funds, or it doesn't make a difference? (I'm using IBKR as broker for the regularly taxed account)
4. My current investments are in an ISA, so I can rebalance without worrying about taxes (but I pay 15 per operation, with 1 free operation per month). What's the best way to move my investments into the new allocation?
Thanks a lot for the help, this forum is an amazing resource!