פרק 45 - מדריך לבניית תיק השקעות פאסיבי - חלק שני

Building a Passive Investment Portfolio - Part 2 In this chapter (a direct continuation of the previous chapter) we move from principles to implementation: determining the level of risk, choosing indices, choosing funds, and finally, choosing the investment house. ------------------------ 📈 Trading platforms with benefits for those who register through me: ✔️ Excellence Trade https://shorfinancy.co.il/l?l=yt-xnes ✔️ Meitav Trade https://shorfinancy.co.il/l?l=yt-meitav ✔️ IBI Trade https://shorfinancy.co.il/l?l=ibi-y ✔️ Altshuler Shaham Trade https://shorfinancy.co.il/l?l=alt-y ✔️ Psagot Trade https://shorfinancy.co.il/l?l=psagot-y ---------------------- What's inside: ③ Defining the risk level: How to sleep well at night A “good” investment ≠ maximum profit, but one that advances you to your goals and allows you to persevere even in downturns. High returns come with high volatility, statistically over the long term the indices have yielded ~10% nominal including dividends. True risk tolerance only becomes apparent in a “real” crisis with significant amounts. It is natural to adjust the risk later. ④ Portfolio composition selection: which indices make up the exposure A global index base is possible: MSCI ACWI (~85% of the global market, including emerging markets), MSCI World (~85%, excluding EM), FTSE All-World (~90%, including EM). Small Cap: additional risk/return potential, consider as a seasoning, not as a base. S&P 500 is popular due to past performance, but there is no guarantee that this will continue. Overall exposure weighting: If the pension/COPA is on a passive S&P 500 track, you may want to balance in another account (e.g. emerging markets/Europe) to get closer to the world. An IRA gives deep control over composition and exposures (refer to Chapters 6 and 11 for those interested). ⑤ Securities selection: How to choose an ETF that is “right for me” Accumulate vs. distribute: Accumulate reinvest, strengthens compound interest; distribute, money to the account (requires discipline to reinvest). Physical vs. synthetic (swap): Synthetics on American indices sometimes enjoy a tax advantage on dividends, understand risks and operations, the differences are usually minor for the passive investor. Foreign exchange exposure: Default is exposure, foreign exchange-neutralized funds cost money (erosion in yield). Real vs. nominal taxation: Some funds are taxed in real terms (index/forex), others nominally, this changes the net tax you pay. Management fees include: not just the “management fee” line, check also trust fees and variable management fees (up to ~0.3% per year). Domicile (state of the union): Irish people benefit from a tax treaty (usually 15% withholding on dividends), not obligated to distribute. US estate tax: Exposure through direct US assets may be problematic; a passive investor usually has no reason for US funds to distribute. ⑥ Choosing an investment house: Costs: management fees/commissions, foreign exchange conversions. Don’t rule out the bank, sometimes after negotiation the terms are similar to an investment house. Actions and options: What is allowed to trade (Israel/abroad), ability to move portfolio in/out, 867 and withholding tax, trading in fractions of shares (relevant for small amounts). Automation: Standing orders for monthly purchases, reduces “noise” and scheduling. Convenience and service: The interface is a bonus, this service is critical when something gets stuck. Check availability, account opening time, support. Insurance/trust: Securities are held in trust, in the US there is also cash insurance up to a certain limit. Rules of thumb: Passive investor in shekels, real taxation according to the index, few actions: a bank/investment house in Israel on good terms, a great choice. American citizens: A large American broker can be more suitable. Start simple: a global base, then adjustments according to existing exposures, risk tolerance and goals. Bonuses for listeners: A comprehensive PDF guide with examples of investment portfolios (not a recommendation!) + a table of dozens of popular funds: management fees, taxation (index/forex), physical/synthetic, and more. There is also a convenient filtering interface (e.g. “Israeli funds on S&P 500”, “Synthetic on World”). If you liked the guide and want the PDF version: Rate the podcast 5 stars, send a screenshot of your rating to the following address and I will send you the file. [email protected]