Portfolio - what would you add or take away? 🧐

Thank you kindly @Joey_Fantana much appreciated.


Another quick question if someone won’t mind helping? :slightly_smiling_face:

I’ve just worked on editing % on an ETF I hold to increase the yearly % (my replica of the All World Vanguard ETF) and have also built my own version of ARKK Innovation (with the top 15-20 holdings)

On the next invest would it be worth while self balancing these pies as some are over and under weighted now? Or continue to invest by targets?

Thank you kindly

I thought that was the point of the Pies function, no? You se tthe desired weightings and you also have the abaility to rebalance in the even these weightings go off?

I’m asking rather than telling as I don’t use Pies.

I just hold more of a certain stock so think it will always be over weighted as I don’t want to sell it.

I think I may have figured it out. On the next invest I’ll hit self balance so bring everything else in line (roughly) then from then on I just invest by target weights I’ve set them as.

I’ll probably never hit rebalance.

I’ll have to trial it to find out. I think I just overly confused myself (not hard to do)

I don’t want to start a new thread for the question so hoping someone can help answer :slightly_smiling_face:

Isn’t the profit/loss and FX impact usually with the profit/loss being the larger number and the FX being the %

I’ve been through all my US stocks and it’s the way for them all except MSCI world health care - the FX is larger than the loss?

Could someone explain? Thank you

So is the £ strong and the $ weaker right now?
Just unsure why the difference on just this ETF would be so big but the others are all with the profits/loss figure a higher number than the FX?

FX is determine by the difference in rates between the averages of when you bought and now.

most of my positions aren’t bad, but my Realty Income is at a 4.6% loss in FX (just 1% up in profits) because the £GBP has strengthened since I opened the position. £1 = $1.40~ currently and it hasn’t been this high since 2018.

there are those who opened positions in US stocks back when the rate was $1.5-$1.7 per £1 which must be seeing greater returns for their money in dividends since opening the position as it weaker than then still. its constantly changing daily so your positions won’t have identical FX rates even if you bought them on the same day.

check the recorded FX rate at the times you added to these positions and compare to the rates when you added to your other positions that are showing less FX impact.

Ah I think I see!

Yes this ETF has been with me for around 6/7 months now and the other US stocks are much newer so that explains why the FX is bigger on the MSCI. Thank you. Not that I would be would be a terrible time to sell it?!

Do you know how I’d check the FX rate when I bought - is there a website?

Thank you for explaining that makes much more sense now. I was a little like :exploding_head: before.

I did read about the £ being stronger. Just didn’t expect the ETF FX% to be higher than the profit/loss.

It’s a hold though so no real panic.

The difference on the FX will simply be down to the time you purchased the shares at.

If you take a look at the chart below you can see the dollar weakening significantly against the pound.

As we do not have a multi currency accounts your pound purchased the stock in dollars. Your pound is now dollars for good until you sell the stock, at that time it’ll be converted back into pounds. When it’s converted back to pounds it’ll take into consideration the exchange rate which is unfortunately pants right now.

On the positive though, if you have funds to invest right now it might now be a bad time.

I’ve heard some analysts says they’re looking at a 1.43 target, which isn’t far away. The below graph shows the pound getting stronger, the above graph shows the dollar getting weaker. They’re obviously directly correlated, just opposite ways.

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Okay I understand now. Thank you. So basically if I was to buy US stocks today (which I’m not) but if I was basically I would be getting less for my money as the GBP is stronger than the USD. So I would get less. Then if it was to stay weak I would also be worse off when selling?

Just a hypothetical scenario to see if I’ve understood it right?

the stronger GBP means you can buy more of a US stock now than you could last week, if it keeps going up it will be less than what you could buy next week for the same price. however once the direction reverses you could sell for more as the GBP weakens against the USD. those in the US trading UK stocks would seethe reverse impact. as the GBP strengthens (becomes worth more USD) they can sell the UK stocks for more than they bought, because if they hold £1 now for $1.30 and they can sell it for $1.4 they made profit without the stock value changing.

It would be great for a high FX rate when buying, in hopes it goes lower by the time you want to sell.

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I think Daos response clears it up but I don’t mind reframing it if you need too.

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Thank you for explaining. Gosh I didn’t realise FX would stump me so much. This is the first time I’ve seen the FX higher that the profit/loss in a specific stock so not had to overly think it before. I always sort of understood it.

So basically (I hope I’ve got this right) buying US stock now is better than it was say buying it 3/4 months ago because the GBP is higher now?

But selling US stock right now that I’ve had for longer isn’t as good as it would have been 3/4 months ago hence why the stock is showing higher FX as the dollar is weaker?

It’s then better to keep hold of US stock bought when the dollar was stronger as to not loose too much on FX? As it is bound to change direction again.

It’s just more noticeable now because the GBP is strong?

Oh heck I hope that makes sense. Sure I’m over complicating it :roll_eyes:

Indeed. even if you are hit bad by the FX if the price has gone up by much more, it may still be worth selling just so you can move the money to a different US stock that is in a dip, that way you catch both the dip and the higher FX rate and perhaps the market will favour you in both in the future when you choose to sell.

to avoid these impacts people often buy local instead so its a simple judgement on the stock price, and not both the stock and currency rates. currency didn’t hit myself too bad as most of my funds were in UK stock when it shifted.

there’s no telling if it will go up to 1.5 or beyond though.

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Thankfully one is an MSCI ETF and Aphria which are both long holds.

The others are a few tech stocks that I think will be easier to leave. Especially after this weeks red nose dive.

Could be an idea as it would be doubly as beneficial both the dip and the FX.

I know it’s just unfortunate more of my interests lately have been in US stocks. Typical.
I’ll have to keep my eye on the rate for the time being. Currently @ $1.41.

tech did take a hit, but airliners and hotels etc may see a correction now that vaccines are being rolled out and we can start to go places again.

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