Critique my future investment plan

I

ibaraki

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Age: 33

Spouse’s/Partner's age: Single

Annual gross income from employment or profession: E45000

Annual gross income spouse: n/a

Type of employment: Public sector employee (not permanent – contract ends in Sept 2010)

Expenditure pattern: a 'saver'

Rough estimate of value of home: Not a home owner (paying rent of E330 per month)

Mortgage on home: n/a

Other borrowings – car loans/personal loans etc: None

Do you pay off your full credit card balance each month? Yes

Savings and investments:
E56,000 savings i.e. €40,000 in cash and €16,000 in shares. I save ~ €1200 each month

Do you have a pension scheme?
Yes, paying into the Public sector pension for the past 3 years

Do you own any investment or other property? No.

Ages of children: None.

Life insurance: None

What specific question do you have or what issues are of concern to you?
I have €40,000 in cash ring fenced for a deposit for a house/apartment (to buy in 2010 or 2011 ... if I still have a job). Now, I’m looking for a new investment vehicle for my future earnings/savings.
I feel a lot more comfortable investing my own money, so I don’t want to set up another pension or to invest in a managed fund with unnecessary high fees. What I would like to do is split my money to buy into four different ETF’s or funds that track a particular country/Industry. So, for example, every three months, I would buy into one specific ETF/fund - after one year, I would be invested in four different EFT/funds. In the following years, I would add to each position once a year using three months of savings (~€3600). I’m interested in the China, metals & hydrocarbons, agricultural commodities and renewable energy. My investment horizon is 20 – 30 years.
My question is what do you think of the above strategy? Also, advice on what ETF/funds I should be investing in would be appreciated. Thanks.
 
You look like you've got a good head on your shoulders already.

I also like the ETF's as they give you the liquidity of stocks & don't have the management fees of UT's.
Adding once a year is also a good call to save on brokerage fees but this can be at the expense of dollar cost averaging, maybe consider going in twice or three times a year to get the benefits of dollar cost averaging & also to reduce your exposure to inflation (crappy bank interest rates).

You might like to consider assigning some of your future earnings to a stable guaranteed savings / investment vehicle just in case your
ETF's go belly up. You need to spread your risks.

China is probably a sound long term investment imo, they are really striving for world leading economic status & their population are starting from producers to consumers. The same could be said of Brazil, Russia & India to an extent. Maybe consider a BRIC or a BRI ETF as well as a dedicated China ETF.

Agriculture is also looking promising as more & more land is dedicated uses other than agri - food prices will continue to rise. People will always need food. I'd try to focus on agri food production & not agri oil production.

Renewables is a also a good long term bet imo.

I don't know nuttin' 'bout metals & HC's so can't comment.

I think your investment strategy is pretty sound & is also flexible enough to allow you to +/- you annual investments. You might like to set yourself some rules arounf profit taking & cashing out on losing ETF's - it's good to have a plan, otherwise you are blindly pumping in money year after year.

you are lacking on the insurance front - how will you / future family cope in time of death, Critical ilness or total permenant disability - you'll need to keep this in view as your circumstances change.

good luck.
 
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