having a balanced ETF portfolio

[mogiletsiZA]

Coreshares TOP 50 provides exposure to high market cap industrials/resource stocks (rand hedged - that is, will "perform" better if rand weakens) as well as higher exposure to financials compared to TOP 40 which allows for good performance if rand strengthens - this is a good balance. Nerina Visser (EtfSA) likes this etf very much. She is probably the most educated person on SA ETFs at the moment.

 

[supersunbird]

Yes, Warren is a smart guy. He actually does recommend CSEW40 in his book "HOW TO MAKE YOUR FIRST MILLION" - suppose you haven't read it

Quote from warren on JustOneLap:

The CSEW40 is a great hybrid between a normal (pure) index tracking ETF and a more active ETF such as a RAFI or DIVI investment that has an element of decision-making that can impact the investment positively or negatively. The most valid criticism of index tracking investments is that one or two shares could become so large in your investment that you effectively have no diversification. If you try to address that issue, you need to do so without trying to predict what investments will do well. The CSEW40 strikes a great balance because you get the same shares as a normal Top40 but each share gets the same allocation. This means the costs of the ETF can be limited and there are no “active” decisions that might harm your performance. I also like the fact that you get a larger than normal allocation to the smallest companies in the Top40.” - https://justonelap.com/etf-csew40/

STX40 is NOT the same as CSEW40 - Yes, it is the same stocks, but different amounts of exposure and therefore different risk.

Satrix does have the Satrix Equally Weighted Top 40, but not in ETF form, only Unit Trust.

 

[supersunbird]

Coreshares TOP 50 provides exposure to high market cap industrials/resource stocks (rand hedged - that is, will "perform" better if rand weakens) as well as higher exposure to financials compared to TOP 40 which allows for good performance if rand strengthens - this is a good balance. Nerina Visser (EtfSA) likes this etf very much. She is probably the most educated person on SA ETFs at the moment.

And the ETF limits constituents to 10% max weighting on how much is in a single share:

For example, as at 29 Sept 2017 Naspers only had 10,13% weighting in the ETF.

I like that ETF.

 

[Hamster]

Yes, Warren is a smart guy. He actually does recommend CSEW40 in his book "HOW TO MAKE YOUR FIRST MILLION" - suppose you haven't read it

Quote from warren on JustOneLap:

The CSEW40 is a great hybrid between a normal (pure) index tracking ETF and a more active ETF such as a RAFI or DIVI investment that has an element of decision-making that can impact the investment positively or negatively. The most valid criticism of index tracking investments is that one or two shares could become so large in your investment that you effectively have no diversification. If you try to address that issue, you need to do so without trying to predict what investments will do well. The CSEW40 strikes a great balance because you get the same shares as a normal Top40 but each share gets the same allocation. This means the costs of the ETF can be limited and there are no “active” decisions that might harm your performance. I also like the fact that you get a larger than normal allocation to the smallest companies in the Top40.” - https://justonelap.com/etf-csew40/

STX40 is NOT the same as CSEW40 - Yes, it is the same stocks, but different amounts of exposure and therefore different risk.

Try reading what was said before commenting. It's less embarrassing that way.

 

[mogiletsiZA]

Try reading what was said before commenting. It's less embarrassing that way.

I was responding to your comment, Hami, but ok. I disagree on your idea of "buying the same thing" they're not priced the same, constituent weighting differs and so performance will differ. The TOP40 etf from Ashburton is the cheapest etf on market and so pairing it with CSEW40 is a sensible strategy to reduce costs and risks in a portfolio. Something Warren would advocate

 

[Hamster]

I was responding to your comment, Hami, but ok. I disagree on your idea of "buying the same thing" they're not priced the same, constituent weighting differs and so performance will differ. The TOP40 etf from Ashburton is the cheapest etf on market and so pairing it with CSEW40 is a sensible strategy to reduce costs and risks in a portfolio. Something Warren would advocate

We're not arguing which is better, just that both in the same portfolio is duplication. Same instrumetnts, different weighting mechanism.

Further, some of the bigger companies deserve a bigger allocation in the top 40 than the 2.5% CSEW40 allows for. I don't think anybody here would advocate a regular top 40 being all that great considering the ludacris size of Naspers and the like compared to others. Hence CTOP50.

All this has been covered.

And lastly, only clones call me Hami. Will wait for this one to be banned as well.

 

[supersunbird]

Hami, take it easy on the guy.

mogiletsiZA, I can see the value of a 50/50 AshTop40 and CSEW40 mix. It will actually kind of be like the TOP 50. Share would have to be crazy big in such a portfolio to reach 20%, you exposure to current Naspers size would still only be about 11.5% in that portfolio mix.

But the CTOP50 would indeed be a good alternative (3 biggest shares would compose 29% of portfolio , then next 7 biggest shares another 28% in total, so 10 shares will hold 58% and then the other 40, 42%) and give exposure to shares not on the Top 40.

 

[mogiletsiZA]

Hami, take it easy on the guy.

mogiletsiZA, I can see the value of a 50/50 AshTop40 and CSEW40 mix. It will actually kind of be like the TOP 50. Share would have to be crazy big in such a portfolio to reach 20%, you exposure to current Naspers size would still only be about 11.5% in that portfolio mix.

But the CTOP50 would indeed be a good alternative (3 biggest shares would compose 29% of portfolio , then next 7 biggest shares another 28% in total, so 10 shares will hold 58% and then the other 40, 42%) and give exposure to shares not on the Top 40.

Agree 100% that CSTOP50 is a good low cost alternative. That with some Midcap would be sufficient for a well diversified portfolio along with a property etf.

 

[supersunbird]

Agree 100% that CSTOP50 is a good low cost alternative. That with some Midcap would be sufficient for a well diversified portfolio along with a property etf.

Well, thats 50% of the portfolio.

The other 50% would be foreign focused in my portfolio :
CSP500 (20% or 17.5%)
GLODIV (20% or 17.5%)
GLPROP (10% or 15%)

 

[mogiletsiZA]

And lastly, only clones call me Hami. Will wait for this one to be banned as well.

That escalated quickly. Don't hold your breath.

 

[mogiletsiZA]

Well, thats 50% of the portfolio.

The other 50% would be foreign focused in my portfolio :
CSP500 (20% or 17.5%)
GLODIV (20% or 17.5%)
GLPROP (10% or 15%)

Yes, offshore and some dividends too.

Regarding the CSP500, do you not think the Satrix or Sygnia World etf with it's allocation of roughly 60% US, is a good option for better diversification from US only in sp500 while getting exposure to other large economies (UK, EU, Japan)?

 

[supersunbird]

Yes, offshore and some dividends too.

Regarding the CSP500, do you not think the Satrix or Sygnia World etf with it's allocation of roughly 60% US, is a good option for better diversification from US only in sp500 while getting exposure to other large economies (UK, EU, Japan)?

Indeed it's something you can look at.

 

[Magandroid]

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[Bravos]

Thanks, what in your opinion is the cheapest provider of ETFs?

Just checkout out index-funds.co.za, it's literally a list of all index funds and ETF's available in South Africa. You're welcome