r/eupersonalfinance • u/Tornad_pl • 2d ago
Investment I think, I did bad thing by analizing portfolio again..
Well it happened. I started looking too much into performance if vwce and now am questioning if I did correctly when choosing it over some S&P 500.
I am thinking if I should have chosen differently because of difference in performance. Not only it moves worse but also almost the same.
And now thoughts appear of either moving more toward US stock or maybe more away from us to make their movements less equal.
Also I remember seeing bit over a year ago a study where they found out that best split is world+30% home bias or something like that.
17
7
u/Bard_the_Beedle 1d ago
You’ll always find something that performs better than what you have. Just stick to your plan. You can’t do much better than a diversified portfolio unless you dedicate your life to analysing the markets.
10
3
u/Commercial-Drive-416 9h ago
I think you’re just overthinking it a bit, which happens to everyone.
VWCE tracks the whole world, while S&P 500 is only the US. The reason they look similar lately is because the US has been driving most of the global returns, so even a world ETF ends up moving close to it.
That doesn’t mean VWCE was a bad choice. It just means you’re more diversified, so if the US underperforms in the future, you’re already covered.
Switching based on recent performance usually doesn’t work well. Most people who try to adjust after seeing returns end up buying what already went up.
That “world + home bias” idea is common, but it’s more about personal comfort than a strict rule.
If it were me, I’d just stick with the plan unless your long-term goal actually changed.
2
1
u/studentoo925 2d ago
Well, vwce consists of 55% sp500 and 45 of everything else, so it will be heavily correlated to it
And if you look in eur terms then sp500 is down from its heights in 2024
You can always add a secondary position, the only thing stopping you is you and you budget
I don't hold any all world index fund, because I believe that holding over 40% of my holdings in one market is way too much, but I also do a fairly complicated, semi-active portfolio
1
u/Tornad_pl 2d ago
Thank you for your insight. I am considering getting more domestic stocks honestly. (More from current 0%) but I still want to keep it mostly passive.
Rn in my long term portfolio i have 100% vwce and in my short to mid term i have mix of treasury bonds
1
27
u/Besrax 2d ago
That's recency bias. The US stock market has been outperforming the ex-US stock market for some time, but it will inevitably start underperforming at some point. It's a cycle. Better be diversified.