No one rings a bell to mark the bottom of a rout (sadly).I was about to invest a significant amount (€200k approx) in an actively managed fund, possibly the Goodbody Dividend Income 4 fund. Is now a good time to complete this investment or is there merit in holding off for the moment? Interested in hearing peoples views...
Buffet is no longer a great sage , he has made a few mistakes and doesn't actually follow what he says like buying forever. He has been sitting in cash and bonds for years now, he missed out on the technology revolution belatedly investing in apple late in its evolution and now selling half his holdings. He also sold out of airlines at a big loss during the covid slump and missed out on the big rebound. He sold tesco shares a decade ago also at a loss during its slump and missed out on its big rebound. He has jumped in and out of oil stocks but missed the huge increase in value of oil stocks since russian invasion. So he doesn't do as he says holding on to stocks for the long termWarren Buffet to reduce exposure to equities, it is assumed these are indicators of a pending recession.
If you are investing in an actively managed fund, you have already made the decision that the fund management team are best placed to manage your investment on your behalf until you decide to cash in. So if you are having second thoughts now on the ability of the management team in the current investment climate, will you really ever be happy that they are acting on your best interests? If you go actively managed you are making the assumption that the funds will achieve higher returns than passive index following, but with the same risk as your benchmark index. Otherwise you would just buy an index tracker, but with lower costs. So are you happy the actively managed route is for you? If you are, and by anybody's standards 200k is a lot of money to invest in one team's ability to manage your money successfully, you could e.g. consider investing in say two funds, or in two funds and an index tracker; or just trackers?I was about to invest a significant amount (€200k approx) in an actively managed fund, possibly the Goodbody Dividend Income 4 fund. Is now a good time to complete this investment or is there merit in holding off for the moment? Interested in hearing peoples views...
If you go actively managed you are making the assumption that the funds will achieve higher returns than passive index following, but with the same risk as your benchmark index.
My concern is how geographically exposed i am, as an Irish investor. I’m exposed to big tech via simply living here and dependent on our economy (see Irish times 10th august 24 “Ireland’s unbalanced economy”)
… and if I’m “savvy” and invest in diversified global equities too, these are often in reality comprises of 60% US tech. So without ever choosing “tech stocks”, what happens in that sector has massive effects. Options ?
That’s an astute observation.My concern is how geographically exposed i am, as an Irish investor. I’m exposed to big tech via simply living here and dependent on our economy (see Irish times 10th august 24 “Ireland’s unbalanced economy”)
… and if I’m “savvy” and invest in diversified global equities too, these are often in reality comprises of 60% US tech. So without ever choosing “tech stocks”, what happens in that sector has massive effects. Options ?
Thanks Persius for this. My interest is long-term passive investing in balanced index, because I understand that this generally performs well, if one has long enough to wait, and can rebalance portfolio when it makes sense to do so. I appreciate these suggestions.If you want to reduce tech and/or US concentration, there are other indexes that you could invest in such as MSCI Europe, MSCI Emerging Markets or US Small Caps etc. They have all underperformed in comparison to S&P500 or MSCI World in the last few years (especially emerging markets, dragged down by China's woes). But who knows what the next few years will bring.
But you must remember "eventually " can be a very long time, tech was also steam engines, railways, internal combustion engines, telegraphy. People seem to put the information technology sector as exclusively "tech" . The companies or even sectors making the "shovels" now might be only really producing shovels in the future metaphorically speaking. In other words their "tech" just becomes a commodity, look at intel, IBM, Nokia etc , they were producing the "shovels " of tech 20 years ago now they are only producing shovelsAnd on reflection: even if the next few years bring turbulence in tech, it is likely to come back eventually. I imagine that even if tech is in for a rough ride, it is still the sector that 'provides the shovels' (as per the gold rush analogy) to the changing world we are living in.
My concern is how geographically exposed i am, as an Irish investor. I’m exposed to big tech via simply living here and dependent on our economy (see Irish times 10th august 24 “Ireland’s unbalanced economy”)
In relation to this point, you might find it profitable to read the article in last Saturday’s (10 Aug) (UK) Times. Here the deputy financial editor Holly Mead suggested investing in a global tracker if you are uncomfortable with uncertainty. You can read it all here: Why I’m putting all my money in just one global tracker fund (thetimes.com)… and if I’m “savvy” and invest in diversified global equities too, these are often in reality comprises of 60% US tech. So without ever choosing “tech stocks”, what happens in that sector has massive effects. Options ?
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