ETF Need some help with my ETF portfolio

Hi there,

I've been researching into making my first trade(s), I have $3k to spend and will likely hold for 10+ years. I'm starting very early so I'm happy to take on some risk. I was thinking of putting 100% of into the new Vanguard VDHG, which has been diversified and has low fees. Would this be wise or should I do the diversification manually?

Also, someone recommended BetaShares Gear to me because it exposes some risk to my investment, however, the fees are a fair bit higher than Vanguard and so is the growth (not that the past is any indication of the future), would it be better to put say 70% into Gear and 30% into a global index like VGS?

Thanks for your help!

 

welcome to InvestChat ,

as mentioned ( by me on a different thread here ) i am not familiar with the VDHG ( and other new offerings )

i DO hold VAS ( and VHY ) both bought in a market dip in 2011 ( same company but very diffent products

what doesn't appeal to me with VDHG ( and new stablemates ) is you are buying a 'formula ' not a relatively stable basket of shares .

where as GEAR uses leverage ( borrowed cash ) .. a 'big boys game ' with big boys risk taken ( and 'big boys can go broke as well .

now $3K doesn't go very far playing with ( most) ETFs

so .. lets try to keep the unit price below $30

one i am watching ( but do NOT hold yet ) is MVW

Fund description: VanEck Vectors Australian Equal Weight ETF (MVW) invests in a diversified portfolio of ASX-listed securities with the aim of providing investment returns (before management costs) that closely track the returns of the MVIS Australia Equal Weight Index (MVMVWTRG).

Index description: MVMVWTRG is a pure-play rules-based index that combines benchmark with blue-chip characteristics by tracking the performance of the largest and most liquid ASX-listed companies across all sectors, including offshore companies which generate at least 50% of their revenues or assets from the Australian market. Companies in the Index are weighted equally.

Management style: Replication

negatives ( to my mind ) are 6 monthly divs ( several rivals offer 3 monthly divs ) AND it does not seem to have a DRP plan

MVW - VanEck Vectors Australian Equal Weight | Australian Equities ETF- VanEck Vectors Australia | VanEck Vectors Australia ETFs


another is HVST ( i do hold this )

About

• Specifically designed to meet the investment challenges of SMSFs and retiree investors
• Provides exposure to large-cap Australian shares, along with potential for franked income that is at least double the yield of the Australian broad sharemarket on an annual basis
• Risk management strategy seeks to cushion downside market risk
• Opportunity for tax-effective income paid monthly

Advantages

• Strong, tax effective monthly income stream on large-cap shares – aims to be at least double the income yield of the broad Australian sharemarket on an annual basis
• Equity returns with potential for reduced downside market risk
• Opportunity for enhanced franking credits
• A smoother ride – potential for reduced volatility despite changing market conditions
• Liquidity – available to trade on ASX like any share

How to invest

• You can buy or sell units just like you’d buy or sell any share on the ASX
• Fund requires no minimum investment

Australian Dividend Harvester Fund | BetaShares

the negative here is the larger charges , but it does DRP and pays monthly

but i have other shares ( LICs and ETFs ) this isn't my BIG play , as would say, half your early cash invested in this ) ( half of your spare cash is a 'big play ' to me whether it is $50 or $1 million , if you get my drift .

Dividend Reinvestment Plan - DRIP

learn about this ( we call it DRP in Australia )

The Effect Of Compounding

and see if this suits your aims

please research carefully any ETFs considered it is the tiny details that make or break these investments ( for you ) i like to put a week ( or more ) researching AND THINKING on each ETF considered .

every ETF has it's own strengths and flaws ( different from every other ETF )

ETFS trade on NTA

Net Tangible Assets

https://www.investopedia.com/terms/n/nettangibleassets.asp

and are sold ( and bought ) at close to NTA ( calculated regularly by computer ) so you NEED the market to move your way when buying/selling ... let the trend bring the price to you , no need to chase the price

( DYOR ) ( and do what is best for you )

 

For a long game it is hard to argue against the vanguard product. Great diversification and some home country bias, don't need to think about rebalancing as with other combos.

Great place to start and might be all you ever need, why overcomplicate it?

GEAR is going to look good in any Bull market. What's it going to look like in a bear with the leverage and added costs? You will experience one at some stage

 

VAS and VHY have done well for me .. bought i bought both in 2011 during a 'correction '

VAS up 33% ( on SP ) up 31% in unit gain ( courtesy of participating in the DRP )

VHY up 25% ( on SP ) up 46% in unit gain ( courtesy of participating in the DRP )

however Trunt68 is thinking about an entry point when the bull market is very mature ( with a slide possible in the next year )

the big question is what will the market look like in 10 years ( i have a hard enough time trying to see 12 month trends ).

Trunt68's next issue is can he/she invest some more cash IF the market slides in 2018 ( to benefit from the lower entry prices .)

 

My advice is consider what exactly you want to invest in, and then find the ETF that matches that; not the other way around.

Avoid leveraged ETF's: