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What percentage for international funds?

Discussion in 'Managed Funds & Index Funds' started by Johny_come_lately, 5th Nov, 2009.

  1. Johny_come_lately

    Johny_come_lately Well-Known Member

    Joined:
    1st Jul, 2009
    Posts:
    703
    Location:
    SE Queensland
    Hi,

    I have just finished listening to an ASX podcast promoting international investment. It stated that Australia owns only 2% of the worlds business and the Australian market is very heavy in resources and banking.

    What I want to know is, how much % of my portfolio should I have in international funds?

    I currently have:

    cash 17.5%
    Aus fixed int 10.2%
    International fixed int 10.3%
    Aus Shares 48.2%
    International Shares 13.8%

    Is there some ratio of Australian/International funds that is the most efficent? A sort of "bet both ways" asset selection?

    The podcast mentioned India and China, as being the future. The speaker spoke of positioning oneself for the future.

    My veiw up to now,was that the emerging countries were a higher risk. Do I become heavier in this area? Are there any recommened books on this area?




    Thanks, Johny.
     
  2. AsxBroker

    AsxBroker Well-Known Member

    Joined:
    8th Sep, 2007
    Posts:
    1,448
    Location:
    Sydney, NSW
    http://www.travismorien.com/portfolio.ppt

    Slide 30

    Use at your own risk.

    PS This is an example and someone else's opinion. Before making an investment decision speak to your FPA registered Financial Planner.
     
  3. GunnerGuy

    GunnerGuy Index & Property Investor

    Joined:
    26th Sep, 2008
    Posts:
    65
    Location:
    Kuala Lumpur, Malaysia
    Percentage of Foreign Equities

    Jonny,

    Asset allocation depends on age and levels of risk you are prepared to accept. Take a look at ifa.com. This will give you an idea of what asset allocation you should do depending on your risk capacity. It ia a US site but has australian link also so you can see what asset allocation there are in different portfolios.

    Different for different people and different at different ages. For me at 45 years old and 80% of my assets already in investment properties, I have started to adjust my portfolio to roughly the following asset diversification:

    Oz equity: 20%
    Global Technology: 10%
    China equity: 7.5%
    Asia emerging: 7.5%
    Brazil/India/Russia: 7.5%
    US large equity: 7.5%
    Uk large equity: 7.5%
    Precious metals: 5%
    Metal commodities: 5%
    UK small: 5%
    US small: 5%
    Oil price: 5%
    Fixed Interest: 3%
    Cash: 4.5%

    Gunner Guy
     
  4. Young Gun

    Young Gun Guest

    International shares = 0%

    Trust me, you won't go wrong with this allocation....
     
  5. Johny_come_lately

    Johny_come_lately Well-Known Member

    Joined:
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    Posts:
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    Location:
    SE Queensland
    Percentage of Foreign Equities.

    I have finally finished my purchase of foreign shares. My trusty calculator has worked out their percentage value.
    (This does not include my foreign bond allocation.)

    Current Percentage Ratio. :D

    Asia 15.7%
    Europe 20.4%
    America 36.6%
    South America 6.2%
    Japan 7.8%
    U.K. 7.7%
    Russia 2.4%
    Africa 2.7%
    Mid East 0.5%


    This is definately long term. I hope it pays off. We shall see!



    Johny.
     
  6. GunnerGuy

    GunnerGuy Index & Property Investor

    Joined:
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    Posts:
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    Location:
    Kuala Lumpur, Malaysia
    Portolio

    Looks interesting. I hope it works for you.
    Did you use IFA website to assist in understanding your risk category and portfolio planning ?

    Regards
     
  7. Johny_come_lately

    Johny_come_lately Well-Known Member

    Joined:
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    Posts:
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    Location:
    SE Queensland
    Hey GunnerGuy

    I used idea's from Rick Ferri and Will Bernstein. I combined a Morgan Stanley index with a World value index and a emerging companies. They are combined in a 2 : 1 : 1 ratio which gets rebalanced yearly.

    It kinda balances out, as the MSCI is heavy U.S. while the Emerging is heavy Asia(mostly China). These funds have been in negative territory for the past two years. At least they are cheap.

    I decided not to hedge. My timeframe is the rest of my life and I expect the Aus $ to go up and down many times. I just have cash out when the dollar is weak. Anyway, we shall see how it goes.




    Johny.
     
  8. Chris C

    Chris C Well-Known Member

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    Location:
    Brisbane, QLD
    What's this opinion based on?
     
  9. Johny_come_lately

    Johny_come_lately Well-Known Member

    Joined:
    1st Jul, 2009
    Posts:
    703
    Location:
    SE Queensland
    Australia is the Lucky country, don't you know!:confused:




    Johny.