International International equities allocation inside/outside super

i got a quick question/ query in regards to people and their allocations within super and also outside super with investing in interantional etfs/lics/direct shares.

Do you have a set allocation (70 domestic/30 international, 60/40 tilt) or do you soley invest in international through super and stick to domestic outside super, or do you do a clone and have a similar portfolio both in and out of super.

thanks

 

For me I attempt to keep the same split in the SMSF and outside. I find it simpler and don't have to overly stress about it.

An aside, thanks ISP for a couple of days of internet relief. Haven't a clue what's been happening in the world. Has the share market collapsed yet?

 

I'm 100% Aus outside super and 75% Int 25% Aus split inside super.

 

Approx same, 30% AU Equities allocation, on the currency side AUD and hedged 50%, Unhedged 50%

 

All International allocation is in the SMSF along with ASX and most of our cash / term deposit holdings. Outside Super is 100% ASX in joint names / Disc Trust (being wound down) and modest cash holdings. Overtime Super pension mandatory increasing withdrawal rules will gradually see International move from the SMSF to own names.

Given the risk to franking credit refunds which I think is inevitable at some stage even if Labor fail with it in the near future I’m looking to take advantage of franking in own names and minimise wastage of same in the SMSF. So most of the assets without franking are held in the SMSF. It’s another reason in part why I’m becoming more partial to the ETF structure over LICs as under the franking credit scenario ETFs are not being disadvantaged tax wise.

Intended overall allocation across entities is 75% ASX and 25% International unhedged.

 

Have you reduced total overall ASX allocation to 30% now?

 

any particular reason @Nodrog for 100 % aust allocation in joint names outside super in own names and no international holdings? curious!!!

 

As eluded to in my previous post it’s mostly for better overall tax outcome (covering more bases in the future) specific to our circumstances.

 

Yes, decreased AU / Developed, increased bond, EM, Infra, Intl Prop. Just shifting percentages with inflows, no change in funds. 30/30/10/10/10/10.

 

I am 100% AUS in and out of Super.
I will change that with inflows only - eventually.
Happy to stay here for a bit now.

 

Thanks for the insights! How have people decided on ther allocations given all the literature out there for example JL Collins and William Bernstein as well as Charles Ellis and Bogle favouring US due to their home bias but for an aussie investor how have ppl taken this on board especially in a outside super portfolio given all the talk about Australia being such a small sector of the world economy and diversification where some think it is diworseification (PT) where others such as Bernstein suggest 1/3 in bonds due to peoples perceived high tolerance to risk wothout having first experiencing a brutal bear market and downturn!

Would welcome everyones thoughts and ideas!

 

In our case it’s simply a risk management thing which mostly comes back to good old SANF. A bit like house insurance. What if our house burned down for example. The risk of this happening is low but if it did it would be financially devastating for most. Hence I would not sleep well without insurance.

With investing two things stand out to me for what we invest in. First is significant reduction in risk asset income (others worry about capital also) for a long period of time due to a prolonged bear market / crash. How much Cash (some like Bonds also) do we need to provide protection in such times as well as for SANF?

Second is Home country risk. Could something like a Japan scenario happen to Australia for example. Risk might be low but can you be 100% sure? Can YOU, not what others think, sleep well at night with only owning ASX equities?

PS: I just woke up from a deep daytime nap. So still in ga ga land at the moment. Hope I make sense.

 

Makes perfect sense! If i can recall correctly i believe you initially had an all australian equities portfolio and then only later on did you branch out to international for some security and SANF. Was this a dca approach over a couple of years in order to get to your chosen allocation of int allocation say 30% or was a bit of market timing and buying the dips such as brexit annd trump election etc the signal to buy for you and then left alone till the next overseas turmoil or event causes concern across world markets?!!

 

All ASX initially as I wanted to get the income thing happening first. Plus it wasn’t as easy and cheap to own international years ago.

Buying of International has been mostly oppprtunistic and more so ln recent times given current risks / valuations. Still a work in progress to get to desired allocation.

 

My reasoning is based purely on wanting to generate enough income to retire a little earlier than 65. Aus equities is the best vehicle to give me that option. The heavy tilt to International shares via Super is to protect a little against home country risk and for diversification.

The risk of a high concentration to Aus equities is one I'm willing to take for a short time for the benefit of being able to retire earlier.