advisor tom

A Lazy ETF Portfolio With U.S./Foreign Mixture

for a so- called low correlated investment it seems to track dia closely with an increase in beta by some 56%. I know this etf has not been out for very long, but with time one would think that more offerings will be available that may increase alpha without using high beta and highly correlated investments.


On Nov 17 08:27 PM goatfarmer wrote:

> This is a very interesting concept, made possible by the recent proliferation
> of global ETFs. I made a tally from ETF connect and count around
> 150 global, regional and country funds. My comment would be that
> domestic/foreign needn'tbe an either/or decision. Rather, one could
> easily have twenty ETF's: 10 domestic and 10 foreign. Ratios of holdings
> could be according to a chosen benchmark, domestic or international
> and varied according to preferences such as the inversion of the
> yield curve.
>
> This is a tantalizing proposition for the conservative investor.
> It has the benefit of diversification, globalizaation and benchmarking
> without picking stocks.
>
> One potential problem is counterparty risk. Are ETF's as safe as
> the underlying shares? Is there a risk that Ishares could make a
> computer error, or suffer from fraud? Should one consciously diversify
> among ETF holders to avoid such a risk?