INVESTING STRATEGY
Focus on diversification
I’ve just started my investment journey in my early 20’s looking to work into a long term investment portfolio. I was just wondering opinions on my current focus to see if this covers decent diversification. I currently am investing into VAS at 25%, IVV at 35%, IJH at 15% and VGS at 25%. Please and thank you
Connor Jones.
17 June 2023
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Hi Connor, nice work getting started!
In terms of diversification, those holdings in combination definitely does provide a decent level of diversification. There’s Aussie shares, US shares, and other developed markets. So one would have a hard time saying it’s not diversified.
Just to point out though, there are some obvious overlaps. IJH is US mid caps, which are already represented inside IVV. And VGS itself also includes about 70% US shares, so this is doubling up.
You may wish to overweight those shares for some reason, I’m not sure. But if you wanted to simplify it down a bit without losing diversification, that’s definitely doable. The main overlap is IVV and IJH. VGS is the broadest fund overall which has the most companies including all those inside IVV and IJH.
Hope that helps.
Dave
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