QUOTE(Ramjade @ Sep 3 2020, 11:57 PM)
IB doesn't support deposit of USD from 3rd party even with proof. So if are paying USD, you need to deposit in say EUR.
Oh thanks for the info. Didn't know that IBKR doesn't accept USD deposits from 3rd parties. Looks like it's down to either EUR or GBP.
QUOTE(Yggdrasil @ Sep 4 2020, 12:23 AM)
Currency only matters if you plan to lump sum without DCA and matters when you exit.
If a US stock is priced in EUR, it will give you the same return in MYR terms as compared to USD.
Notice that investing in either EQQQ or QQQ gives us the same return in MYR terms as long as USD/MYR rate does not change.
Your returns only change if USD/MYR changes.
Meaning if you bought US ETF when MYR was weak and sold when MYR is strong, you lose a due to exchange rate (suppose ETF did not change).
However, if you bought US ETF when MYR was strong and sold when MYR was weak, you gain due to exchange rate (suppose ETF did not change).
However, this currency fluctuation tends to be around 10% only. If you lump sum RM30,000 today and in 10 years it's RM60,000 (a 100% return), you can expect to either make 110% return or 90% return after converting back to MYR.
QUOTE(Yggdrasil @ Sep 4 2020, 01:16 AM)
IMO, it's more important that you choose the ETF that gives you the higher expected return than obsessing with liquidity/currency issues. Choosing a shit ETF will give you shit returns even if you have the best liquidity/currency rate.
But then again, no one can predict the future.
Also, beware of expense fees. Unpopular ETFs tend to have higher expense fees. IMO, anything above 0.25% p.a. is high.
Thank you Yggdrasil for the very detailed explanation. Your post basically illustrates the effects of currency movements on investment value. It's like macroeconomics 101. Your illustration assumes that USD/MYR exchange rate remains constant, but in the real world scenario, exchange rates constantly fluctuate. I actually plan to DCA into this ETF every 6 months, so hopefully I will average-out the exchange rate fluctuations.
But as you have mentioned in your second post, no one can predict the future, and that we should not obsess with liquidity or currency issues. I am not here to debate/speculate on currency movements. I am here for low-cost diversified investing. I agree that choosing the right (low-cost) index is more important. A lousy index gives lousy returns, and a hyped-up index may just be another bubble waiting to burst.
QUOTE(Gwynbleidd @ Sep 4 2020, 01:48 PM)
I'm a big fan of Vanguard FTSE All-World ETF too until an ETF that tracks the Global All Cap Index is introduced (hopefully by Vanguard too).
Global All Cap Index? Meaning the index covers developed + emerging markets across large, medium, and small-cap sectors? It's gonna be expensive to track so many stocks across the globe. Most ETFs will "optimally replicate" the index to reduce operational fees. Even the Vanguard FTSE All-World doesn't fully replicate the index. And the weightage allocated to small-cap stocks are so small, their contributions (or lack-of) are insignificant to the overall index.
This post has been edited by pigscanfly: Sep 4 2020, 11:08 PM 
Jun 28 2020, 06:24 PM
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