I am relatively new to the PP, just finished reading Craig's book, and am now looking at implementing it myself. I am also new to the financial investment world, so please bear with me if any questions or comments seem obvious.
Since I'm based in Germany, I did some Google research on good candidates for the 4 asset classes as a German, and I came across this:
Wikifolio seems to be a site where people can publish their portfolios and others can invest alongside them. The page is in German, but you should be able to Google Translate it.
My question is not regarding this site though, but more concerning the selection of assets:
- 25% COMST. ETF IBOXX LIQI SOVGS DIVERSIF. 25+ TR - LU0444606619
- 25% DB GOLD OEZT - DE000A0S9GB0
- 1% EUWAX GOLD - DE000EWG0LD1
- 24% ISHARES DJ STOXX 600 (DE) - DE0002635307
- 25% Cash (not specified)
So, apart from the question regarding Gold (above), I guess I'd be interested in the general opinion on this portfolio by the people in this forum, especially from a European/German perspective.
- Is ISHARES DJ STOXX 600 (DE) a good candidate for a stock index fund? It seems rather inexpensive 0.2%, but I could not find the % turnover which is an important criterion according to Craig.
- Is the STOXX 600 a good index to track or would be DAX (and maybe mDAX) be better suited?
- The ISHARES DJ STOXX 600 is distributing dividends (rather than reinvesting). Craig says reinvesting is not a good option for the PP, but he says so mostly because it makes tax reporting more difficult and it can "distort" the rebalancing bands. I am not sure the tax stuff applies to Germany since our brokerages deduct the tax automatically. Also, how are the rebalancing bands distorted? Isn't it the same thing if dividends just go into my cash allocation only that the cash bands would be "distorted" instead of the stock bands?
- Is there an obvious advantage of using COMST. ETF IBOXX LIQI SOVGS DIVERSIF. 25+ TR over directly buying long running German govt bonds? I think they are regarded as being the "safest", is diversification (using the ETF) a good idea or just the "lazy" approach?
- Since Germany stopped offering Tagesanleihen (our T-Bill equivalent), it seems that regular savings accounts ("Tagesgeld") seem to be the only option for cash. Am I correct or are there better options for cash?
(I am not affiliated with wikifolio or the person running this portfolio...)