I need help to start

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pika7
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I need help to start

Post by pika7 »

Hello from Spain. Although I speak little English, I'm reading what little is published in Spanish Bogle philosophy ... and I am a faithful follower .... Now ... as I start? I explain my situation.
I have about 70000 Euros invested in active management ... and other 150000 in cash, without investing ... waiting to set the strategy. 500 euros monthly savings. I am 42 years old and two children. My idea is that this money on the one hand serve to supplement my retirement in 25 years, ... and on the other hand leave a legacy to my children. I even contemplate the possibility that the college of my children are paid with these returns for which are 15 years. Not if you can help, on the one hand to set up my portfolio and on the other as to the dollar cost avering ... how long, how often, in what quantities. In fin..estoy I made a mess. Thank you in advance for your patience and help.
go_mets
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Re: I need help to start

Post by go_mets »

If you use the Chrome web browser ( https://www.google.com/chrome/browser/desktop/ ), it will automatically offer to translate a web page to any language you want.

It is very helpful.
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pika7
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Re: I need help to start

Post by pika7 »

Thanks
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Peter Foley
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Re: I need help to start

Post by Peter Foley »

Podrìa usted darnos una idea de quales son las inversiones que existen en España? Es posible invertir en el mercado estadounidense?

En cuanto a "dollar cost averaging", el beneficio es más sicològico que monetario. Con las cantidades que usted ha indicado, yo lo harìa cuatro veces al año por dos años.
Topic Author
pika7
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Re: I need help to start

Post by pika7 »

Hello! Thanks for your help. Today exiten numerous ETFs Vanguard also indexed funds Amundi and picket in Spain, and as I communicate the coming weeks Vanguard funds may contract in my trading but do not know too much and also not as set portfolio . On the other hand I have other questions that expose them:
1. In Spain the tax treatment of ETFs is unlike index funds, the latter are more interesting. This free transfers so I think it can be very interesting to rebalance.
2. What worries me the dollar cost avering is to catch all the upside of the bag if I do it in a short period of time, by that I mean the money I have now, is different from the monthly savings iria doing. Here siren songs that are in bullish bond bubble and this has to lose heard.
3. They just authorize in Spain gestion management through automated or robot what are your views? It's rising cost management efficiency?
Thanks so much for your patience and support
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Peter Foley
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Re: I need help to start

Post by Peter Foley »

Interesting post . . .

Does "upside of the bag" mean "top of the market?" If so, yes that is a danger in investing all your money at once. Dollar cost averaging can take two forms: 1. You have cash now and can invest it all at once or over a period of time. Studies have shown that from a financial perspective, it is best to invest it all at once. My preference is to not to do it that way because if the market drops you will be disappointed and may decide to sell. You would need to have good risk tolerance (la habilidad de tolerar el riesgo). 2. You will be contributing to an account on a regular basis and buying shares of a stock or mutual fund when you contribute. This version is also known as periodic investing. You buy more shares when prices are low and fewer shares when prices are high. This is a highly recommended approach.

Some automated investments are good. It depends on the fees they charge. Can you do it yourself for less?
IFKC
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Re: I need help to start

Post by IFKC »

Op, wishing you the best of luck in setting up your path forward. Please be very careful in implementing whatever you read in these forums: for all the simplicity Bogleheads seek, the terminology can be tricky enough for native English speakers. So please be sure 1) that people understand what you are asking and 2) that you understand what is being advised. Your family will thank you. :happy

Generally speaking, and if I understand what you're asking, I'll second what Peter Foley advised (with the caveat that I respectfully disagree with not investing it all at once, for the reason that he described). I'll add in that dollar cost averaging (DCA) has historically produced very good results. Finally, I strongly recommend obtaining Spanish copies (assuming the exist) of the books recommended by this forum (A Random Walk Down Wall Street being a great place to start).
A happy father and tepid lawyer, trying to do the right thing
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pika7
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Re: I need help to start

Post by pika7 »

Thanks for your valuable help. I read Bogle, the small investment book, A Random Walk Down Wall Street and now I'm locked in the four pillars of the investment.
I am convinced that my case it is best to make regular contributions .... the question that arises is whether to start next year and how long to extend it ... two ... three .... meantime ... the monthly savings you'll be doing if they earmark funds to me this advisable. I'm a little liada..¿como I start? Thank you!
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dratkinson
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Re: I need help to start

Post by dratkinson »

Could look here: https://www.bogleheads.org/wiki/EU_investing

Could also read about investing from United Kingdom and Germany (links at bottom of above) as I recall specific ETFs were listed. Will want to resolve any tax issues (to minimize taxes) before investing.

Sorry I can't be of more help.
d.r.a., not dr.a. | I'm a novice investor; you are forewarned.
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Christine_NM
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Re: I need help to start

Post by Christine_NM »

You are busy? (liada) With other things? Wait until you can give this the attention it deserves. Or if you mean busy trying to figure this out, then OK, carry on.

Keep the 70000 invested. Move it to ETFs. Do you know what you want your asset allocation will be?

DCA (or ECA for euro cost average) the 150000 euros within a year from starting. Buy monthly or quarterly. We do not know what will be best, just pick a schedule and stick with it. Buy low or buy high, but buy on time. Averaging in is just a mental trick. All the money will be invested and eventually be at the same risk as if you invested in 1 or 2 months. Hopefully you will be fully invested within a year. If not, you are taking too long and price ranges may get ahead of you.

You are reading the best books! Bear in mind however, that we in the US have had a favorable market for a long time and these books were mostly written with US market history as a positive bias. I have to keep reminding myself that what I have experienced in the past 40 years will not happen again for a long time. Keep your expectations modest.
16% cash 49% stock 35% bond. Retired, w/d rate 2.5%
IFKC
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Re: I need help to start

Post by IFKC »

All good insight. One final thought, taken with a grain of salt: the book Value Cost Averaging by former Harvard Professor Michael Edelsen referenced a study finding that for some reason cash infusions over certain time frame worked better than others. The approach isn't very popular here, but it's something that may be worth consulting for additional information if desired.
A happy father and tepid lawyer, trying to do the right thing
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pika7
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Re: I need help to start

Post by pika7 »

Thank you for your kind answers. I have plan to start with 80 equity and 20 fixed income ... after this I go crazy trying to assign a fair proportion of the assets ... usa, europe, emerging? and which ones are better. I realize after reading Mr. Bogle that more modest returns expected in the coming decades. I worry mostly keep invested capital in a simple way and to leave something for my children. However I am quite austere. Could advise me or show me some recommended funds and percentage? Thank you
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Christine_NM
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Re: I need help to start

Post by Christine_NM »

Pika -

I saw a video of Mr Bogle recently where he basically punted as far as giving specific us/developed/emerging allocation advice. You will have to figure out what makes sense to you, so you will know why you own what you do. We all have our different reasons and our different allocations.

All we can say is, be aware of the global stock portfolio and deviate from there as you see fit. That is roughly 50% US, 50% everyone else. It may be 45% US or it may have increased again, hard to keep track.

A global stock etf is probably the best starting place for you. I do not know what is available at the brokerage you are using.

I really liked (and used) Edleson's book on value averaging. He recommends quarterly investing, that is why I mentioned it. It involves using a spreadsheet so I do not know if that appeals to you or not.
16% cash 49% stock 35% bond. Retired, w/d rate 2.5%
Topic Author
pika7
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Re: I need help to start

Post by pika7 »

THANKS you are wonderful
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dratkinson
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Re: I need help to start

Post by dratkinson »

pika7 wrote:...Could advise me or show me some recommended funds and percentage? Thank you
See: Example of EU domiciled ETF providers: https://www.bogleheads.org/wiki/EU_inve ... _providers

Will need to search each linked provider's website to see what they offer. Then from all possible options, select low-cost (fees + taxes) options that give your desired world stock coverage and local (EU) bonds.
d.r.a., not dr.a. | I'm a novice investor; you are forewarned.
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Peter Foley
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Re: I need help to start

Post by Peter Foley »

At your age 60% in stocks would be reasonable. Half that could be in the US and half in International. While many here recommend some part of international should be in emerging markets, I do not. Emerging markets are optional diversification not obligatory diversification.

30% Vanguard Total Stock Market and 30% Total International would be a good basic approach. Mutual fund o ETF, me da igual.
Topic Author
pika7
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Re: I need help to start

Post by pika7 »

Good morning. Thanks very much for all the information and direction. You are wonderfoul. Thanks
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