Is it right time to invest?
- Thread starter Gary017
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For the avoidance of doubt I’m not recommending an investment in the S&P 500
The data is simply to illustrate the point that trying to time the market is a Loser’s game over time you are always better off in the market (however you decide to define it)
A good starting definition of the “market” would be a broad global index like ftse all world or MSCI All world
This puts the relative size of different markets into perspective, so for example the U.K. is now only about 5% of global equities and not nearly as important or significant as it once was.
Certain indexes are now virtually ignored by serious commentators including the Dow Jones, FTSE 100 or the ISEQ here in Ireland. They are simply too concentrated and a much more globally diversified portfolio can be achieved at very low cost.
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Younginvestor93
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A lot of people invest in the sp500 bit many say that is not diversified enough and that you should invest in global equities instead like a vanguard all world fund. What is your opinion on placing all your eggs in the US basket?
galway_blow_in
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a world fund will have at least 50% exposure to the U.S market
Younginvestor93
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Yes amongst the rest of the world. Is it safe to bet solely on the US considering there is no real diversification in that sort of portfolio?
The companies in the S&P 500 are global brands and sell their wares all over the world.
galway_blow_in
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The U.S market is far and away the most diverse
europe ( especially the FTSE ) is laden down with banks and energy , two zombie sectors
No I use them to cover my forex losses.
FTSE 100
Jan 2000 6,800 = €10,812
Jan 2005 4,800
Jan 2010 5,400
Jan 2015 6,500
Jan 2020 7,600
Today 6,500 = €7,345
I'm hoping the OP's next Question is how? so what's the best (security, tax, access, best value fees) to way to invest in say the MSCI All world (outside of a pension wrapper) ?
Younginvestor93
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How is the US market, investing in a S&P 500 diverse? It's not, you are betting on US as the dominant force.
An all world equities ETF for example is diverse. Vanguard have their VWCE which covers this for example.
Younginvestor93
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There is some diversification because of what you said but its still a bet on the US. US may be the big player for the next 30 years or it may not.
Alphabet / Google generates more revenue outside the US than inside. That's one cherry picked example but if the rest of the world grows Google will grow and the S&P500 will grow. I'm sure it's similar to Apple, Tesla et al. I consider that a decent level of diversification. Up to you if you think otherwise.
galway_blow_in
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"betting on the U.S as the dominant force " has been an ultra safe bet for as long as people have been buying equities
dont fight it
Younginvestor93
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I am aware of that but every article from investment websites on the subject suggest, it is not diversified enough. If the dollar were to tank in value for example, or the face that the US market is grossly overvalued currently. If you type in S&P 500 and diversified into Google you will see all the arguments against only betting on the S&P500.
Curious, I presume you invest in the S&P 500, do you invest in the dollar or the euro hedged index fund?