Welcome Guest ( Log In | Register )

Outline · [ Standard ] · Linear+

 [DIY] S&P 500 Index w/ 0.07% Annual Fee, Buy the best companies in the world

views
     
KingArthurVI
post Jan 17 2022, 06:47 PM

BWOAHHHH
******
Senior Member
1,124 posts

Joined: Feb 2011
From: Penang



Hi sifus I'm in a dilemma between SWRD/IWDA (both track MSCI World Index, meaning developed markets large and small caps) and of course the almighty S&P500 (CSPX/VUAA, etc...)

One of the reasons I think SWRD/IWDA is attractive is it's more diversified than S&P500 and it reduces the withholding tax exposure (although only 15% coz Ireland-domiciled). Anyone went with one over the other and have some thoughts to share?
KingArthurVI
post Jan 17 2022, 07:11 PM

BWOAHHHH
******
Senior Member
1,124 posts

Joined: Feb 2011
From: Penang



QUOTE(honsiong @ Jan 17 2022, 06:51 PM)
Or just buy VWRA. No dividends, it's just accumulating by itself.
*
VWRA 0.22% TER vs. SWRD's 0.12%, the 0.10% difference is quite huge cry.gif
KingArthurVI
post Jan 17 2022, 10:21 PM

BWOAHHHH
******
Senior Member
1,124 posts

Joined: Feb 2011
From: Penang



QUOTE(Davidtcf @ Jan 17 2022, 09:43 PM)
Would suggest to buy BNKS and XDWF.. Both invest in banks and financial institutions amidst this interest rate hike period by Fed. BNKS focus on US financial institution. XDWF on developed market's financial institutions.

For S&P500 better go for VUAA (same thing as CSPX). Cheaper and it is rising in value. Easier to get into it due to price.

If you're into ESG - environmental social and governance companies, buy SUSW or SASU.

SMH good pick also due to shortage of semiconductors globally. Likely price hikes incoming for all things semiconductors.

All listed here are Irish Domiciled ETFs. I did some research on my own, and also reading articles before recommending.

I would avoid tech stocks for time being as they are expected to go down a lot. Energy and consumer staples another good etf to invest in.

My VWRA, SWRD and CSPX went down alot in last two weeks. So will stay away from them first till stabilize. Not sure how much more they can drop.
*
Thanks bro for the valuable input. Will seriously consider VUAA when I’m ready to get in smile.gif
KingArthurVI
post Jan 18 2022, 01:30 AM

BWOAHHHH
******
Senior Member
1,124 posts

Joined: Feb 2011
From: Penang



QUOTE(Hoshiyuu @ Jan 18 2022, 12:43 AM)
I'd advice to avoid advice from people who have just started investing, jumping from one failed investment vehicle to another, repeatedly timing the market then get burned, yet go around regurgitate whatever they just read yesterday without fundamentally understanding it ... if they can provide sound justification or reference material for you, then take those and do your own research.

Just because it's an act of considerate kindness doesn't mean its factually true, always do your own due diligence...
Depending on your capital, you might want to consider some of the following factors:

SWRD only covers developed country large and mid caps, so no Alibaba, no Tencent, no TSMC, usually people who go with SWRD will mix in EIMI or WSML for either emerging market exposure and/or developed country small caps exposure. The cheaper TER is likely due to missing such coverage. You are trading exposure for fees reduction.

If you end up holding multiple ETF due to wanting exposure to certain segments, you need to take into consideration of your purchase and rebalance cost - buying 3 tickers monthly is going to eat into your cost if you aren't throwing in a decently large amount.

---

If you wanted to chase performance, you can just all in SP500(VUAA/CSPX), if you wanted to diversify (via buying SWRD), why stop at large caps and mid caps of developed countries?
Winners rotate, Large/Mid and Small caps take turns getting returns, US and the rest of the World take turns getting returns - hence why VWRA is recommended - and I am sure those who hold VWRA would happily hold VT instead of it didnt had a 30% withholding tax.

Personally I recommend to VWRA and chill too, hold one ticker, get rich slowly but surely.
*
Thanks for taking the time to write your recommendation biggrin.gif

One thing I wanted to point out is that VWRA doesn't seem to carry small caps at all, the factsheet mentions it only carries large and mid-cap companies. But aside from that, I wholeheartedly agree with your general philosophy of holding total global market and chilling. I'm currently in the midst of rotating out of my Bursa dividend stocks into IBKR and looking to build a braindead portfolio. I was initially thinking SWRD+EIMI for some time (was thinking Eimi Fukada holding a sword.... lol sweat.gif) because of the lower TER as compared to VWRA, but you made a good point about rebalancing and purchasing separate tickers adding to the hidden costs of the portfolio.

I also think about IWDA which is the OG developed markets ETF with 0.20% TER until SWRD came with 0.12% TER. If you compare IWDA's 0.20% with VWRA's 0.22% it's a no-brainer to just "VWRA-and-chill". I think this is a convincing-enough argument for me to go VWRA for my core "safe" portion of my portfolio.

If I have about RM50k, do people generally recommend lump sum since VWRA is relatively stable, or does it still make sense to DCA one's entry over maybe 3–6 months?

This post has been edited by KingArthurVI: Jan 18 2022, 01:45 AM
KingArthurVI
post Jan 18 2022, 01:53 PM

BWOAHHHH
******
Senior Member
1,124 posts

Joined: Feb 2011
From: Penang



QUOTE(Hoshiyuu @ Jan 18 2022, 02:59 AM)
Yeap, VWRA unfortunately do not carry small caps, its not ideal but it's impact is smaller than you might think. I've posted this before somewhere else so don't mind the copy paste:
Of course, if you believe in small cap value tilt or factor tilting in general, it's very easy to quickly dig back into the rabbit hole that we just crawled out of, like adding in AVUV/AVDV and just ignore the withholding tax since small caps rarely generate enough dividend to matter, and since they are US listed, the trading cost is way lower, etc.

But my personal recommendation is always, keep it simple, hold VWRA, spend the time on increasing one's income instead.

As for lump-sum vs DCA, it's a much debated topic so I'll just give you my personal opinion:

Time in the market > Timing the market, lump sum should give you a higher return - keyword being should.
While VWRA is relatively stable, with VWRA being basically ~60% US, and lump-sum into a decade long bull market is always scary, can you really withstand your 50k poofing to 30k overnight, and keep holding it for another decade or two?

For me, I have a good 20 year horizon minimum ahead of me, I'm looking forward to a crash to test my resolve, get cheap shares, and I believe in investing in VWRA enough that I haven't really found another place that I would put the majority of my money into (e.g. if for any reason VWRA drops 50% overnight, well, chances are nowhere else is really safe anyway), so personally I will lump-sum that amount in today.

Besides, I think I'll have much bigger regret seeing VWRA go up by 3 dollars when I only deposited only 5k out of 50k and end up panic FOMO lump-sum anyway  tongue.gif
*
Wow rclxms.gif thanks for the much valuable insight! I like the idea of a braindead portfolio a lot, coming from someone who thinks buying dividend stocks on Bursa is even too much of a pain, so I think I'll go with your recommendation of VWRA over micro-managing multiple ETFs. Lump-sum investing is a bit scary for me, but I think my investment horizon is definitely very far out, 10-20 years, so short-term volatility shouldn't factor in too much over time.

Just out of curiosity, how often do you top up your ETFs? And are you using IBKR? On IBKR, the LSE commissions seem to encourage less frequent / higher amount top-ups rather than like US exchanges which are $0.35 minimum.

 

Change to:
| Lo-Fi Version
0.0489sec    0.26    7 queries    GZIP Disabled
Time is now: 30th November 2025 - 06:44 PM