Heya, I am new to Trading212 and new to investing, so apologies if this is a strange question.
I have a pie where the allocation is entirely S&P500. I invest £155 per month (equivalent to £5 per day) into this fund. The reason why I invest £5 per day is because that is the amount I used to spend on beer when I was drinking.
I wish to invest more money into S&P500 but I don’t want to do it within the same pie, as I wish to see my returns solely on that £5 per day so I know how much money I’ve made by cutting down on beer.
My question is: If I create a second pie which is also entirely comprised of S&P500, am I missing out on compound interest, or does it not matter?
E.g: I would have 2x pie with £2000 each, rather than one pie with £4000.
Perhaps that’s a bizarre question. Any guidance for a newbie is appreciated. Thanks very much.
You can usually get four cans from a supermarket for about that still
As I understand it, pies just act a way of subdividing your portfolio, and shouldn’t have any effect on things like interest on your cash balance (which is done by looking at the cash balance as a whole and calculated daily). Yes, an accumulating ETF will avoid any issues around dividend re-investment (rounding issues, or dividend being too small to be re-invested maybe), because they are done internally in the fund and reflected in the share price. The SPDR S&P 500 accumulating ETF (ticker SPXL) is one of the lowest cost ETF’s tracking that index, with an OCF of 0.03%..
Congratulations on stopping a bad addictive habit man! You are in the right place to start a good habit - investing for your future.
Regarding your question: No, it doesn’t matter. You don’t lose any compounding.
It’s like splitting the money between two pockets instead of one. The end result is exactly the same.
A bad habit to have daily
You are in the right place to start a good habit - investing for your future.