Why is investing in IWDA or SWRA recommended for world exposure? Or even VWRA for both developed + emerging markets?

Looking at the top holdings of global funds, it resembles the S&P500. So am wondering what is the optimum ETF strategy. My plan is to diversify with a strong focus on US, China and their tech:
1. S&P500 e.g. CSPX
2. US Tech e.g. QQQ
3. China top companies e.g.FXI
4. China Tech e.g. CQQQ,
5. Emerging markets e.g. EIMI

Understand the sum of the expense ratio above may be high (~1.9%), so that could be a reason many will choose IWDA as a simplified form of diversification. Any other reasons?

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Discussion (3)

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Frankie Rappaport

06 Sep 2020

Hi, yes, to concentrate on U.S. and China, and technologies particularly, seems interesting, also to me, but - of course - very risky.

Textbook wisdom would tell, however, that one (besides other allocations) should mostly, f.ex., as 'core investment', diversify globally into stocks via passive indexing ETFs and having sector ETFs (tech) only as a smaller add-on.

To be successful one should periodically re-buy (and hold for almost forever) with a cheap online broker, reducing all fees to the minimum.

The ETFs should favorably be accumulating (though distributing ones are still o.k.), have a low TER, have a high AUM, being replicated physically (not synthetically via SWAPs which is possible in Europe's ETFs).

You cannot add up the TER expense ratios but have to average to calculate correctly.

For global investing there are:

MSCI World (SWRD)

MSCI ACWI (SPYY, ACWI), has China integrated, more expensive TER

FTSE Global All Cap Net TR US RIC (VT)

Vanguard FTSE All-World UCITS ETF (VWRA/VWCE)

For global technology investing:

XDWT, FDNI

For U.S. investing:

CSPX, VOO

For China investing:

CNYA, MCHI, PGJ