Improving Success

Hello you amazing and wonderful people. I do hope your investing is going well and you are healthy.

I have been investing for over 3 years now and i please kindly wanted your thoughts on something. I please wondered what is the most important or most valuable aspect you review in choosing an investment in deciding whether this will be successful in the future please? I have had a few stocks that have not done so well and wanted to try minimise this. If you kindly had any thoughts on what is the most important factor in helping increase the chance of an investments success i would be very thankful.

Thank you so much for any advice or help you can kindly give me. Thank you very much and have a lovely week. All the best.

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Everyone’s investing goals, or where they are at in their journey is different, so I don’t think there will be a one size fits all.

Personally, I would start by taking advantage of any offers, and investing in ETFs taking a long term view. A global equity ETF/fund is my core investment. I buy regularly, and don’t monitor the day to day peaks and troughs.

Stock wise, I buy into some for the concept, the management, or simply through FOMO. Other stocks I buy like Mitchell & Butlers, purely for the investor perks(20% off at any of their chain).

Always keep some dry powder, so you never need to be forced to sell in a market downturn. Trim your outperforming holdings, as in most cases things revert back to the average with the odd few exceptions.

I would also, if you are picking stocks, try to keep them limited so you can monitor any news.

This is the hard bit for me managing 100 stocks/ETF’s :laughing:
Also i don’t quite like the idea that most ETF’s are market cap weighted and maybe 15 - 20 years time we discover that strategy is flawed

We do have about 30-40 years of data on this, and because of no transactions costs and no capital gain taxes in market-cap weighting, it clearly outperforms other types of weighting.

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Which global ETF are you investing in?

HMWO and VWRL.

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By using https://backtest.curvo.eu/ I came to the conclusion you are better off just investing in S&P500 than global ETFs like VWRL(=dist) / VWCE(=accumulating) or IWDA.

See the comparison S&P500 vs VWCE:

See the comparison S&P500 vs IWDA:

@danger89 there is the whole past performance may not indicate future performance and so on. Personally, I would say that a lot of the companies in the S&P generate profit through global sales, so you could consider it a sort of restricted global equity fund directed at companies based in the US.

We also have in the past 5-10 yearsX the USD becoming stronger than other currencies.

Nothing is guaranteed in life, hence I would prefer the more globally weighted ETF.

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While all of this is true, this is not what makes this graph meaningless.

I invite danger89 to try the same comparative with different starting dates; because of the higher volatility of the SP500, many starting dates will result in a negative performance against its benchmark.

The better approach would be to run the same comparative for every starting date, and run an average of the performance spread.

Results will yield that the SP500 does outperforms world indexes, but by a much narrower margin.

Now with such analysis, the biggest risk factor will then be past performance not indicative of future results.

In investment research, the period problem can often lead to cherry picking of results, rendering a very inaccurate picture of reality.

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What’s your biggest holding, Zergui?

Stocks would be MMP.
Financial assets would be BTC (bought in 2019, no matter how much money i throw at stocks I can’t keep up :joy:)
All assets would be a rental property.

Thanks. So only individual stocks/btc only, no ETFs? :wink:

I do have a couple, but they are not my biggest holdings. Cumulatively, about 10% of my Stocks/ETFs are index funds, some S&P500, some EU bonds.
But core portfolio is indeed single stocks position.

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