Originally Posted by
Snoopy
Your idea of putting everything into a US index tracker fund is not indexing in a New Zealand context. IMV much of the 'investment' in an index that is driven by the 'magnificent seven' or whatever they call then since NVIDIA joined in, is just speculation. I have absolutely zero interest in joining such a party.
If you look back over the NZX contests I have entered, which are representative of my actual NZX portfolio, you will see that I slightly underperform the index in good years (down a couple of percentage points maybe) and dramatically outperform it in bad years. This is largely because I tend to invest in defensive dividend paying shares as I appreciate the steady income and the optionality that income gives me. Over the business cycle if I can outperform all the brokers, and beat the index by a couple of percentage points each year, I am happy. So far it seems to be working out, even if I do 'cheat' by holding some NZX investments outside of the NZX50. Small caps tend to perform better over time, with the downside that liquidity is worse. So I am very careful in selecting my small caps such that I would be happy to hold them if the market closed for five years.
SNOOPY