Gyroscopic Investing

MangoMan wrote: ↑Sat Nov 09, 2019 7:40 am

ochotona wrote: ↑Fri Nov 08, 2019 6:59 pm A new, tiny ETF, offered by AlphaArchitect.com. I spoke to Jack Vogel over there today.

https://freedometfs.com/

It only invests in Emerging Markets with a high quotient for human liberty and economic freedom. A capital idea!

While I am 100% in favor of human liberty and economic freedom, mixing politics and investing* is not the way to maximize profits. As long as you realize this going in, have at it.

I will also, again, recommend staying away from ETFs that trade on low volume.

*mixing politics and sports is also not the way to maximize profits. (see ESPN, NFL, NBA)
*mixing politics and Thanksgiving, however, is a way to save on Christmas gifts.

Challenging to trade low volume ETFs. You have to use limit orders, take a look at the charts, trade small blocks. But at some level you have to mix politics and investing. I just don't think you could invest in the late 1930s and into the early 1940s and be OK with holding German war stocks.

Fully one fifth of the equity portfolio of my portfolio is invested in emerging markets. Emerging markets SCV to be exact.

Emerging markets are riskier than developed markets. And markets are very efficient. It stands to reason that the market will then price emerging market stocks to have higher expected returns. This is doubly true for the SCV regime.

The PP has a limited amount of equity exposure. Tilting the stock portion of the portfolio towards the riskiest parts of the market makes eminent sense IMO.

Smith1776 wrote: ↑Sun Nov 10, 2019 12:24 am Fully one fifth of the equity portfolio of my portfolio is invested in emerging markets. Emerging markets SCV to be exact.

Emerging markets are riskier than developed markets. And markets are very efficient. It stands to reason that the market will then price emerging market stocks to have higher expected returns. This is doubly true for the SCV regime.

The PP has a limited amount of equity exposure. Tilting the stock portion of the portfolio towards the riskiest parts of the market makes eminent sense IMO.

That sounds familiar... https://portfoliocharts.com/portfolio/s ... fat-tails/

Yeah, I'm torn about this tiny fund. FRDM. It is so friggin' small. I think it would be a nightmare to momentum trade it. I think the only way to own it is to really buy it and hold it, have a small strategic allocation to it, and kind of forget about it. Then maybe you wake up to a pile of cash in your account and an email from your brokerage saying, "Oh, by the way, your ETF holding FRDM got delisted and liquidated last week"

If you pair up some international developed market ETFs with certain other emerging market ETFs, you either omit or double-dose on South Korea.

XSOE and FRDM, discussed here earlier, both have S. Korea in them, so if you also get Vanguard VEA, you double-dose the kimchi.

IDEV is a developed market ETF that does not feature S. Korea, so if you pair that with EEM, you totally omit S. Korea.

Just thought I'd point that out...

Smith1776 wrote: ↑Sun Nov 10, 2019 12:24 am Fully one fifth of the equity portfolio of my portfolio is invested in emerging markets. Emerging markets SCV to be exact.
...
It stands to reason that the market will then price emerging market stocks to have higher expected returns. This is doubly true for the SCV regime.

How long have you held emerging markets?

dualstow wrote: ↑Sun Nov 24, 2019 10:02 am

Smith1776 wrote: ↑Sun Nov 10, 2019 12:24 am Fully one fifth of the equity portfolio of my portfolio is invested in emerging markets. Emerging markets SCV to be exact.
...
It stands to reason that the market will then price emerging market stocks to have higher expected returns. This is doubly true for the SCV regime.

How long have you held emerging markets?

I occupied a position in EM using dual momentum principles, but haven't owned any since mid-2018. I keep monitoring them. Currently don't have any.

dualstow wrote: ↑Sun Nov 24, 2019 10:02 am

Smith1776 wrote: ↑Sun Nov 10, 2019 12:24 am Fully one fifth of the equity portfolio of my portfolio is invested in emerging markets. Emerging markets SCV to be exact.
...
It stands to reason that the market will then price emerging market stocks to have higher expected returns. This is doubly true for the SCV regime.

How long have you held emerging markets?

I've always had some exposure to EM. At first it was through simply holding market weight index funds.

However, after reading/hearing the excellent work of the likes of Larry Swedroe and Eugene Fama, I'm convinced that factor diversification has efficacy. At the very least, I don't expect it will hurt. In the best case, there should be some benefit.

My current EM factor fund of choice is MEME.B. It's a fund that has Manulife's name on it, but it's actually managed by DFA (scroll down on the page and there are implementation details. yay!).

https://funds.manulife.ca/en-us/etfs/MEME.B

Thanks

MEME.B, less than $8 million AUM? Not dead already?

ochotona wrote: ↑Sun Nov 24, 2019 3:27 pm MEME.B, less than $8 million AUM? Not dead already?

If you think that's bad, their U.S. SCV has even less: $2.76 million.

https://retail.manulifeinvestmentmgmt.c ... tfs/MUSC.B

It's a risk i'm willing to take. Just about all my funds are tax sheltered, so no risk of cap gains in the event of a shutdown for me. Additionally, these are the only funds in Canada with truly decent multifactor exposure (at least IMHO).

MangoMan wrote: ↑Sat Nov 09, 2019 7:40 am

ochotona wrote: ↑Fri Nov 08, 2019 6:59 pm A new, tiny ETF, offered by AlphaArchitect.com. I spoke to Jack Vogel over there today.

https://freedometfs.com/

It only invests in Emerging Markets with a high quotient for human liberty and economic freedom. A capital idea!

While I am 100% in favor of human liberty and economic freedom, mixing politics and investing* is not the way to maximize profits. As long as you realize this going in, have at it.

I will also, again, recommend staying away from ETFs that trade on low volume.

*mixing politics and sports is also not the way to maximize profits. (see ESPN, NFL, NBA)
*mixing politics and Thanksgiving, however, is a way to save on Christmas gifts.

Not only is freedom not free, it is a bit expensive.