Investing

Last updated in October 2018.

What I currently do

Most of the money on ETFs. A little money on individual stocks. Some cash as emergency fund.

ETFs

  US Dev - US Eme
Market cap SCHB + SCHA SCHF + SCHC SCHE
Fundamental FNDB + FNDA FNDF + FNDC FNDE

All 6 table cells equally weighted, and all pairs of funds also equally weighted inside each cell.

Individual stocks

Selected based on P/E, P/B, Debt to Equity, Net Profit Margin.

How

Schwab broker for buying funds.

CapTrader (Interactive Brokers) for exchanging CHF to USD.

Buy every week, fixed cost, target the desired proportion.

Why

Market cap funds in general provide diversification at low cost. Weighting by market cap invests a quantity of money proportional to the market value of each company / sector / country.

SCH* funds have low cost (low TER, low turnover, low bid/ask spread – and at Schwab also no buy/sell fees). The 3 funds together can be used to emulate VT at a lower cost, with the downside of having to manually rebalance (upside of being able to choose a different proportion), and owning fewer companies (~4k vs ~6k).

The downside of market cap weighting is that when a company (or sector, or country) is overpriced (e.g. during a bubble) it ends up buying more of it, and less of it when it is under priced.

I choose to give equal weights to US, Developed (- US) and Emerging Markets. This currently means under weighting US and over weighting Emerging Markets vs the current market caps. This avoids bubbles across funds but not inside each fund.

Fundamentally weighted funds (like FND*) weight independent of the price, using other factors like sales, cash flow and dividends/buybacks. In theory this buys more of the under priced companies and less of the over priced companies. The downside is that those funds have higher cost (higher TER, higher turnover, higher bid/ask spread).

I choose to weight SCH* and FND* funds equally.

I choose to give equal weights to funds tracking large and small companies. This reduces concentration and likely increases returns, with the downside of increasing risk.

The downside of funds in general is that they have a yearly cost. Buying individual stocks avoids the yearly cost, with the downside of less diversification and more time spent choosing.

I choose to put a little money on individual stocks.

Summary:

  Market cap Fundamental Individual
Holding cost Medium Worse Better
Diversification Medium Better Worse
Value Medium Better < Medium

Composition

Key Stats

ticker Expense Ratio Portfolio Turnover Assets Under Management Number of Holdings Total Top 10 Weighting Weighted Average Market Cap Distribution Yield Average Spread (%) Average Spread ($) Average Daily $ Volume Avg. Daily Share Volume Median Daily Volume ($) Median Daily Share Volume
SCHB 0.03% 4.00% $12.72B 2283 18.25% $207.34B 1.84% 0.02% $0.01 $70.71M 1035780 $44.02M 625967
SCHA 0.05% 11.00% $7.51B 1634 2.30% $3.14B 1.40% 0.04% $0.03 $36.56M 492496 $29.47M 378937
SCHF 0.06% 5.00% $15.25B 1401 10.33% $59.57B 2.66% 0.03% $0.01 $113.75M 3511731 $83.57M 2538173
SCHC 0.12% 12.00% $2.02B 2038 3.42% $2.34B 3.17% 0.10% $0.03 $9.50M 275900 $6.53M 185889
SCHE 0.13% 7.00% $4.49B 901 22.61% $85.55B 2.76% 0.04% $0.01 $34.80M 1402102 $29.98M 1252100
SCHE 0.13% 7.00% $4.49B 901 22.61% $85.55B 2.76% 0.04% $0.01 $34.80M 1402102 $29.98M 1252100
FNDB 0.25% 10.00% $257.25M 1522 19.11% $165.76B 2.17% 0.20% $0.08 $822.95K 20906 $698.11K 18185
FNDA 0.25% 21.00% $3.13B 863 3.17% $4.82B 1.40% 0.09% $0.04 $11.00M 277347 $8.41M 210038
FNDF 0.25% 10.00% $3.83B 837 13.39% $61.74B 2.60% 0.10% $0.03 $22.42M 768074 $10.64M 359542
FNDC 0.39% 18.00% $1.76B 1485 1.86% $3.74B 2.27% 0.14% $0.05 $9.51M 284929 $4.85M 142398
FNDE 0.39% 14.00% $2.11B 307 26.49% $71.69B 2.29% 0.09% $0.03 $10.25M 366821 $7.21M 253335
FNDE 0.39% 14.00% $2.11B 307 26.49% $71.69B 2.29% 0.09% $0.03 $10.25M 366821 $7.21M 253335
avg 0.20% 11.08% 14.17% 2.30% 0.08% $0.03

By Sector

ticker SCHB SCHA SCHF SCHC SCHE SCHE FNDB FNDA FNDF FNDC FNDE FNDE avg
Financials 17.00% 25.10% 23.67% 19.89% 27.59% 27.59% 14.79% 22.23% 19.44% 15.84% 20.68% 20.68% 21.21%
Technology 24.63% 12.72% 7.16% 8.35% 25.08% 25.08% 16.03% 10.44% 3.82% 7.10% 19.14% 19.14% 14.89%
Industrials 10.88% 14.62% 14.63% 20.48% 5.75% 5.75% 11.63% 19.69% 13.49% 23.32% 4.18% 4.18% 12.38%
Consumer Cyclicals 13.13% 13.86% 12.02% 13.64% 6.23% 6.23% 13.41% 17.45% 13.46% 18.97% 5.44% 5.44% 11.61%
Energy 5.73% 4.45% 7.50% 6.47% 9.94% 9.94% 12.16% 5.63% 13.21% 5.15% 23.77% 23.77% 10.64%
Basic Materials 2.50% 5.74% 7.52% 11.02% 7.79% 7.79% 3.06% 7.93% 8.42% 10.22% 9.04% 9.04% 7.51%
Consumer Non-Cyclicals 6.60% 3.64% 9.90% 7.16% 6.03% 6.03% 10.32% 4.58% 8.78% 9.42% 4.99% 4.99% 6.87%
Healthcare 13.87% 13.42% 9.81% 6.32% 2.43% 2.43% 10.49% 6.01% 7.05% 4.42% 0.14% 0.14% 6.38%
Telecommunications Services 1.86% 0.88% 3.53% 1.69% 5.33% 5.33% 3.45% 0.80% 5.89% 1.42% 9.23% 9.23% 4.05%
Utilities 2.75% 2.75% 2.83% 2.19% 2.96% 2.96% 3.65% 3.04% 5.05% 2.68% 2.98% 2.98% 3.07%
sum 98.95% 97.18% 98.57% 97.21% 99.13% 99.13% 98.99% 97.80% 98.61% 98.54% 99.59% 99.59% 98.61%

By Region

ticker SCHB SCHA SCHF SCHC SCHE SCHE FNDB FNDA FNDF FNDC FNDE FNDE avg
North America 100.00% 100.00% 7.50% 17.77% 0.45% 0.45% 100.00% 100.00% 7.90% 10.15% 0.16% 0.16% 37.05%
Asia-Pacific 0.00% 0.00% 38.00% 36.48% 70.69% 70.69% 0.00% 0.00% 33.62% 50.00% 62.23% 62.23% 35.33%
Europe 0.00% 0.00% 54.02% 45.31% 5.62% 5.62% 0.00% 0.00% 58.05% 39.06% 18.44% 18.44% 20.38%
Latin America 0.00% 0.00% 0.00% 0.00% 13.45% 13.45% 0.00% 0.00% 0.00% 0.00% 14.52% 14.52% 4.66%
Middle East & Africa 0.00% 0.00% 0.49% 0.44% 9.78% 9.78% 0.00% 0.00% 0.43% 0.79% 4.64% 4.64% 2.58%
sum 100.00% 100.00% 100.01% 100.00% 99.99% 99.99% 100.00% 100.00% 100.00% 100.00% 99.99% 99.99% 100.00%

By Country

ticker SCHB SCHA SCHF SCHC SCHE SCHE FNDB FNDA FNDF FNDC FNDE FNDE avg
United States 100.00% 100.00% 0.00% 0.00% 0.00% 0.00% 99.99% 99.86% 0.00% 0.00% 0.00% 0.00% 33.32%
Japan 0.00% 0.00% 23.12% 19.79% 0.00% 0.00% 0.00% 0.00% 24.90% 37.02% 0.00% 0.00% 8.74%
Hong Kong 0.00% 0.00% 3.04% 0.00% 25.73% 25.73% 0.00% 0.00% 0.00% 4.43% 19.62% 19.62% 8.18%
United Kingdom 0.00% 0.00% 15.55% 13.19% 0.00% 0.00% 0.00% 0.00% 18.50% 11.75% 0.00% 0.00% 4.92%
Taiwan, Province of China 0.00% 0.00% 0.00% 0.00% 14.40% 14.40% 0.00% 0.00% 0.00% 0.00% 12.54% 12.54% 4.49%
Korea, Republic of 0.00% 0.00% 4.36% 6.22% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 19.53% 19.53% 4.14%
Canada 0.00% 0.00% 7.27% 17.47% 0.00% 0.00% 0.01% 0.14% 7.01% 9.04% 0.00% 0.00% 3.41%
Russian Federation 0.00% 0.00% 0.00% 0.00% 3.91% 3.91% 0.00% 0.00% 0.00% 0.00% 14.65% 14.65% 3.09%
Brazil 0.00% 0.00% 0.00% 0.00% 7.44% 7.44% 0.00% 0.00% 0.00% 0.00% 9.16% 9.16% 2.77%
India 0.00% 0.00% 0.00% 0.00% 11.30% 11.30% 0.00% 0.00% 0.00% 0.00% 4.57% 4.57% 2.65%
France 0.00% 0.00% 9.07% 2.94% 0.00% 0.00% 0.00% 0.00% 9.50% 4.31% 0.00% 0.00% 2.15%
Germany 0.00% 0.00% 8.11% 5.06% 0.00% 0.00% 0.00% 0.00% 8.96% 3.48% 0.00% 0.00% 2.13%
Australia 0.00% 0.00% 6.01% 5.99% 0.00% 0.00% 0.00% 0.00% 6.17% 5.53% 0.00% 0.00% 1.98%
South Africa 0.00% 0.00% 0.00% 0.00% 7.23% 7.23% 0.00% 0.00% 0.00% 0.00% 4.52% 4.52% 1.96%
Switzerland 0.00% 0.00% 6.94% 4.05% 0.00% 0.00% 0.00% 0.00% 5.43% 3.08% 0.00% 0.00% 1.63%
China 0.00% 0.00% 0.00% 0.00% 8.49% 8.49% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 1.42%
Mexico 0.00% 0.00% 0.00% 0.00% 4.04% 4.04% 0.00% 0.00% 0.00% 0.00% 4.01% 4.01% 1.34%
Thailand 0.00% 0.00% 0.00% 0.00% 3.93% 3.93% 0.00% 0.00% 0.00% 0.00% 2.52% 2.52% 1.08%
Italy 0.00% 0.00% 0.00% 2.96% 0.00% 0.00% 0.00% 0.00% 3.17% 2.73% 0.00% 0.00% 0.74%
Sweden 0.00% 0.00% 0.00% 3.99% 0.00% 0.00% 0.00% 0.00% 0.00% 2.81% 0.00% 0.00% 0.57%
Malaysia 0.00% 0.00% 0.00% 0.00% 3.29% 3.29% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.55%
Netherlands 0.00% 0.00% 2.78% 0.00% 0.00% 0.00% 0.00% 0.00% 2.58% 0.00% 0.00% 0.00% 0.45%
Spain 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 3.36% 0.00% 0.00% 0.00% 0.28%
Poland 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 1.65% 1.65% 0.28%
sum 100.00% 100.00% 86.25% 81.66% 89.76% 89.76% 100.00% 100.00% 89.58% 84.18% 92.77% 92.77% 92.23%

By Size

ticker SCHB SCHA SCHF SCHC SCHE SCHE FNDB FNDA FNDF FNDC FNDE FNDE avg
Large (>12.9B) 81.96% 0.06% 76.05% 0.00% 62.90% 62.90% 81.54% 4.86% 79.41% 2.66% 68.31% 68.31% 49.08%
Mid (>2.7B) 13.59% 54.80% 22.67% 32.88% 31.35% 31.35% 13.57% 52.67% 19.24% 43.93% 26.91% 26.91% 30.82%
Small (>600M) 4.20% 42.24% 1.29% 59.91% 5.70% 5.70% 4.54% 38.48% 1.15% 48.08% 4.76% 4.76% 18.40%
Micro (<600M) 0.24% 2.91% 0.00% 7.20% 0.04% 0.04% 0.35% 3.99% 0.16% 5.33% 0.02% 0.02% 1.69%
sum 99.99% 100.01% 100.01% 99.99% 99.99% 99.99% 100.00% 100.00% 99.96% 100.00% 100.00% 100.00% 100.00%

By Style

size Value Blend Growth
Large 26 17 13
Mid 9 8 7
Small 8 7 4

Top Companies

Name Sector Country Assets %
Taiwan Semiconductor Manufacturi… Technology Taiwan 1.00
Samsung Electronics Co Ltd Technology Republic of Korea 0.83
Tencent Holdings Ltd Technology China 0.79
China Construction Bank Corp H Financial Services China 0.69
Gazprom PJSC Energy Russian Federation 0.67
Alibaba Group Holding Ltd ADR Consumer Cyclical China 0.64
Apple Inc Technology United States 0.63
China Mobile Ltd Communication Services China 0.53
Vale SA Basic Materials Brazil 0.52
Oil Co Lukoil Pjsc - Russian Federation 0.49

Valuation

Holding P/E P/CF P/B
SCHB 17.93 12.39 3.00
SCHA 17.21 9.35 2.07
SCHF 13.56 4.51 1.56
SCHC 14.59 6.40 1.45
SCHE 12.04 4.85 1.58
FNDB 15.31 9.79 2.44
FNDA 16.79 8.93 1.96
FNDF 12.63 3.79 1.37
FNDC 14.65 5.74 1.29
FNDE 7.72 3.36 0.93
Overall 13.61 6.51 1.69

Past Allocations

Without small cap companies

  US Dev - US Eme
Market cap SCHB SCHF SCHE
Fundamental FNDB FNDF FNDE

With equal weights.

Without fundamentally weighted ETFs

  US Dev - US Eme
Market cap SCHB SCHF SCHE

With equal weights.

Without equal weights

  US Dev - US Eme
Market cap SCHB SCHF SCHE

With weights matching VT (i.e. more US and less Emerging Markets).

Alternatives

TODO: discuss savings account, bonds, buying a house, retirement, peer-to-peer lending, etc.