International Asian exposure in portfolio: LICs, ETFs or other

Which 4 funds are you referring to, @The Falcon ?

-Frank

 

I admit i enjoy reading these discussions.

 

Best listen to @The Falcon. I’m just old, confused, senile and stubborn:

 

i enjoy reading these threads immensely. In fact, it is a treat I look forward to most during a work day when I fire up PC and follow posts from my favourite posters.

If one can read all this and continue to go back to basics and keep doing the simple things right, there is absolutely no issues whatsoever. But i have found some people, much more intelligent than me (both here and at work), when given a multitude of options stuff it up considerably in trying to over-optimise. It is almost as if that if a solution is not complicated, it must be wrong. If you have that tendency, watch out. As always, success in life is hugely dependent on knowing yourself (flaws and all) throughly.

 

I enjoy this stuff for intellectual stimulation but as time goes on the two most important things that I’ve learnt to appreciate more and more is Simplicity and SANF!

A reminder of Bogle’s quote “the enemy of a good plan is the dream of a perfect plan”.

 

Yes, satisficing beats optimization in this field imho. The stock market is a complex adaptive system.

 

Bill Bernstein - Liability Matching and Bonds

Totally off topic still sorry but it drives me mad when I can’t remember where I read things. Given @The Falcon asked a question I wanted to get my facts correct given I don’t always trust my memory.

Trouble is with famous authors is what you hear from them will depend on where and at what time period they wrote and / or said something.

The other very important point is that much deeper thinking is required to relate what you read back to your own circumstances. THERE IS NO SUCH THING AS ONE STRATEGY FITS ALL. This includes Thornhill’s approach which I had defended during a recent stubborn brain snap. It will vary greatly depending on your level of wealth, personal preferences and behaviourial factors including SANF.

This interview with Bernstein highlights this fact and his view on bonds / bond funds which admittadly is how I have always felt about them. Note CDs = Term Deposits (in Australia):

For your Fixed Interest portfolio I recommend you buy one of these:

 

For education, I'm in an accumulating phase but I want to understand when I hear what this means

What are short term treasuries?

So the three safe assets were cash, short-term Treasuries, and CDs?

 

Treasury Notes | AOFM

However for most retail Australian investors a short duration Term Deposit (< 6 months) or an online High Interest savings account is likely to be more appropriate than short term treasuries.

Just remember that to receive the Gov’t Guarantee spread your cash around:

 

I look forward to having to worry about this problem someday

 

He he. Yes it’s one of the better worries to have.

 

Still off topic and entertaining myself with this sorry all.

Meant to add the below quote in response to my earlier concern and @the falcon’s question about Bernstein and inflation. I must admit I’m somewhat skeptical about the following especially after taking tax into account. Perhaps in a zero tax Super Pension environment it might be a possibility (mandatory withdrawal % could be a problem though) otherwise I doubt it:

Owning even a small allocation of stocks I would have thought more sensible rather than effectively retiring on short duration Term Deposits in an Australian context.

@The Falcon / others, thoughts?

 

Bernstein might be assuming that the game is already won and there is no point taking any risk to keep playing. However, given that on a long time frame shares beat everything else, there must be something we're missing.

 

Interesting article:

The changing shape of emerging markets – Wealth Foundations : : Wealth Foundations Blog

The Evolution of Emerging Markets
Register for Morningstar.com

 

“The China hustle” on Netflix is a good watch, on Chinese backdoor listings on the NYSE / Shorting frauds. Soren Aandahl of Glaucus Research who recently took down Blue Sky (BLA.AX) makes an appearance. Although it’s focus is on specific type of fraud, it raises further questions.

 

MSCI's China A shares move key for foreign investors

 

Full article here

I reckon give another 5-7 years and India would start appearing in lot of such articles. It is currently the only major economy growing at 7%+ with best population demographics for continued growth over the coming 2 decades. BSE (Bombay stock exchange) India's equivalent index of US's DOW was 100 points in 1979 and today in 2018 is 38,000 which equates to 16.45% compounded annually (excluding dividends) for last 39 years. Trailing P/E ratio of BSE is 23.5% so it's not in bubble territory like the Nikkei was in late 1980s.

Although, I have sold VGS and poured money into IVV and IJR instead. I still stand by my conviction to invest in VAE. Asian story is still attractive and has plenty of growth remaining.


Cheers,
Oracle.