Faut-il remplacer son ETF Monde ?

You may have a global ETF in your

portfolio, whether in a PEA, a

securities account or a

life insurance policy. And it's true that on

social media, it's by far the

most recommended stock market investment. And that's

normal in the end, since with this

ETF you have a single fund but in that

fund you have access to 1300 companies

in 23 developed countries. So it

really is the epitome of simplicity for

investing in the stock market. In addition, you

are super diverse. So there you have it, you just need to

invest the

amount you want every month in a

global ETF type ETF and then we won't talk about it anymore. But

if you have this famous global ETF, I

'm sure you've already asked yourself the

question, is it really the

best solution? Because when you

look at its composition, you quickly

realize that ultimately this global ETF

is mostly made up of US stocks. We have 73%

American shares, about 15

% European, a little over 5% Japanese

and then it spreads out a bit with some

Canada, some Australia and so on

and then no emerging markets.

So naturally, we avoid trying to

say to ourselves, "Hey, couldn't I

make my own little recipe, my own little

homemade mix, always using

ETFs, for example, very simply with

an SP500 ETF for the United States and a

Europe ETF for Europe." It could

be stock, MSI Europe, it doesn't matter. And

then, as an option, I can also include

a small emerging market ETF. It's true

that on paper, it's quite clever;

firstly, it's more flexible, it's

potentially a little cheaper in

terms of costs, and above all, we have

the impression of regaining control.

But you'll see that when we do

the math, it's not just "Oh look,

I ended up rebuilding pretty much

the same thing, even with lower fees

, because sometimes we think we're

optimizing our portfolio, but in

reality we're completely changing its

composition." Okay now, to

make this a little bit concrete, I'm going to say to myself,

here's how to do it if I have

€1000 to invest in a PEA to invest

worldwide. The first option, as we've already

discussed, is that famous global ETF.

For the example, I used the TF Amundi

PEA world. The ticker is DCAM and at the

time I am preparing this video, the

share is worth €6. So with €1000 I can

buy 166 shares. 166 shares at €6 each

makes €996 invested. So I have

about €4 in cash left. But given that the

price of this ETF is quite low,

it's convenient, right? Almost everything is

invested. And in concrete terms today

with the current weights of this MSI

world index, but at €996 they will look roughly like

this. €724 from

US shares, €154 from Europe in the

broadest sense, €56 from Japan, €34 from Canada,

€16 from Australia and then it's

really sprinkled out in Hong Kong,

Singapore, Israel, New Zealand and

then other developed

but much smaller countries. So

when you buy a Mond ETF, as I've

already said, you are mainly buying

United States. I think it's not a

surprise to you, we hear about it

regularly, it doesn't just make people

talk, it makes people scared and so on.

But what may

surprise you a little more is that

this American dominance hasn't

always been so strong. And even going back a long way

, if I go back to 2000, we

had about 53% American shares

in the MSI world. And if I go back to

1988, it was more like 32%.

You see the evolution, it's

quite remarkable, isn't it? 32%, 53%, 73%,

it really makes you wonder where

it's going to stop. So buying

developed markets today means

accepting a large weighting on the

United States. We've already talked about it, it's

not necessarily a problem but you need to

know about it, you need to be aware of it. And

since there is no emerging market in

a global ETF, we quickly tend to

summarize that the

simplest composition to summarize is United

States plus Europe. But that's a

bit too simplistic because in the end

you also buy lots of

tiny bricks that are often forgotten.

So, there's Japan, there's Canada, there's

Australia, uh, there's Switzerland

and the United Kingdom, I want to get out

of the Eurozone a little bit. And these

little bricks, they are ultimately

not insignificant. So yes, the amount

isn't huge, it's not something that

will completely change your

portfolio, but ultimately it's still

good for you to diversify.

Now, if I move away from the countries a bit

to get down to the level of

companies, but 996 € they are

invested in roughly 57 € of Nvidia,

51 € of Apple, 41 € of Alphabet, 34 € of

Microsoft, 27 € of Amazon. So

unsurprisingly, we mostly buy

American champions. But we must also not

forget that we have this long

international network of more than 1000

companies. Now, the second option is that

instead of

buying a global ETF, I'll

rebuild it myself. So I'm going to

use an SP500 ETF as an example in

the video. I'm going to take the PSP5 ticker

and then for Europe, I'm going to take

an MSI Europe ETF and the ticker for

the example is PCEU. With

current prices, I can buy 12 shares of

SP500 which will cost me approximately €686. I

can buy h shares of the TF MSI

Europe, which makes €307 invested in

the ob. So in total, I invested €993.

So, I end up with approximately 69%

American stocks and 31%

European stocks. So, on paper, it's

quite clean. But do I

really have the same thing as my Mond ETF

? Well, I think you guessed it,

not at all, because in my

home portfolio I have roughly the

same proportion of US and I aimed

like that, but I have much more

Europe. Why do I have so much more

of Europe? because I ultimately have

zero on Japan, I have zero on

Canada, zero on Australia, zero on

Hong Kong and so on and €0 on

emerging markets. But that's already the

case for the global ETF. So we see him

having an SP500 ETF plus a European ETF, that's

not at all the same as having a global ETF.

That's really just an approximation. And

this approximation is not neutral

because what it says is "I keep

the United States but I

ultimately replace Japan, Canada, Australia and

then the rest of the developed world with

more Europe." So it might be a

good choice, but in any case, it's a

choice. Now, if I look at

the biggest companies, in reality

it doesn't change the

portfolio much, or rather the top of the

portfolio, since I end up

with roughly €57 from Nvidia, €49

from Apple, and so on. So, for the

largest American stocks, I am

ultimately very close to the global ETF. That

's not the real difference. The

real difference, as I was saying, is that I have

much more of Europe. So if

I go down a little bit in the

ranking, I find myself, for example,

with €15 in ASML versus €7 in the OTF

world. I end up with €7 from HSBC

compared to €4 in the rest of the world and so on.

So I pre-decline but basically I

double almost all my

European positions and above all, this is my

important point, I tend

to forget certain areas of the MSI world,

notably, as I said, Japan, Canada,

Australia, so obviously we can be

very comfortable with this approximation,

saying that the big

American and European companies sell

all over the world. Yes Apple sells in

Japan, yes LVMH sells in China, Microsoft

sells everywhere and so on, but despite all that, I no longer have

Toyota, I no longer have Sony, I no longer have

Shopify, I no longer have Royal Bank of

Canada. So individually, these are

tiny lines, but

collectively, they represent about

10% of our world, and especially this 10%

which helps to diversify because

Canada is not the United States even

if it is very close, and then Japan

remains an economy that is really

apart. So, a quick aside since

this video is sponsored by my

partner Saxobank. You know that at

Saxo, you can open or transfer

a PEA, but also a securities account or

even a company account. You have access

to more than 50 markets, that is to say 23000

shares, 7000 ETFs, more than 5000

bonds. So whether you wanted to keep it

very simple with a global ETF or

you wanted to build a

slightly more personalized portfolio,

you have access to a very

wide universe. Another point I like is that Saxo

offers two platforms. You have Saxo

Investor, which is a very

intuitive and simple platform, and then you have

Saxo Trader Go, which is much more

complete if you want to go further.

And right now, with my link in the

description, Saxo is offering €500 in

brokerage fees waived for 3 months for

opening or transferring an account.

So let's get back to our TF portfolio.

An interesting point is that neither of the

two current portfolios has an

emerging market component. And yet we are still in a

world where South Korea, Taiwan and

obviously China are still classified

as emerging markets. What does that mean

? That means we don't have Samsung,

we don't have TSMC. So the foundry that

makes most of the semiconductors

in the world, we obviously don't have

Tencent, Alibaba and no big

Indian companies. And that's

probably the biggest advantage of the

home TF. That is to say, from the

moment we say to ourselves, well, I'm going to make

my own portfolio and I don't want to stick

to a global ETF, I

can choose to have a little more or

less of the United States, more or less

of Europe, and obviously that famous

emerging market pocket. But before we get to

that, we're going to try to better replicate the

TF world because we've seen that the

SP500 and Europe version is simple

but it forgets quite a few countries and in

particular the very country or rather

geographical area which is Japan. And

Japan is a good

diversification option. This is very

different from previous economies. So what we

can do is keep an

SP500 ETF, keep an MSI world ETF and

then add a Japanese ETF. So for

today's example, I took an

Amundi PEA Japan Top ETF. The ticker

is PTPE. And seeing the number of

parks I can buy, I end up

with €971 invested, which is

roughly 76% from the United States, 16%

from Europe and 8% from Japan. So here we

are already a little closer to

TF worldwide, but we can see that it's not

perfect. We got Japan back but we

still don't have Canada, Australia,

Hong Kong and so on. And then we see

that, inevitably, depending on the

ETF prices, we cannot replicate

exactly, for example, 72% of the

United States. Now we can

expand further and make a version 3. This

time, we will add an Amundi

PEA Asia Pacific ex Japan ETF. The ticker

is PEJ. We end up with €988

invested. We are at 69% United States, 16%

Europe, 4% Japan and 11%

Asia-Pacific excluding Japan. Here, we

begin to see that we are diversifying quite a bit

. So, we're not really replicating the

MSI world anymore. For what ? Because the

brick we have just added at the moment

, that is to say Asia-Pacific,

excluding Japan, also includes

emerging countries. So, we end up with

Taiwan, Korea, China, India, and so on.

We can see that the choice quickly becomes

endless. We start thinking, "Well,

S&P 500 plus Europe, yes, but

Japan is missing. Yes, but part

of Asia is missing. Oh, well, I've added

emerging markets. Then, I

added only

Asian emerging markets, but why not

emerging markets in a broader sense?"

And so, when we try to rebuild

like that with a global ETF, very quickly, the more

layers we add, the more complexity we add,

and ultimately we lose

the main initial advantage of global ETFs,

which was that it's simple: you have

a single line item, and that's it, you don't have to

bother with anything. So, for me, when

we start asking ourselves the question, "Do

I keep it simple with

a global ETF, or do I create my

own ETF portfolio?" For me, there are

three things to consider. The

first question is really this

question of simplicity. Do I

just want to invest all the Months of

automatic adjustments, just one line? Well,

the TFON, it's true, it has a

huge advantage. We place our

regular order, there's no rebalancing, and

so on. It's really the solution. There you have it

, it's

absolute simplicity. We also don't have to

wonder, "Are the US

too expensive? Will Europe

catch up? Should I

allocate that famous 5% to Japan in my portfolio, or should

I stay at 0%?" Now,

it's true that a global TF is less

intellectually stimulating, especially if

you're interested in the stock market. And since

you watch my videos, I know

you're interested in the stock market. So, there's

always that slightly

frustrating aspect of having a global ETF. But you

have to keep one thing in mind:

having a simple stock market strategy

that you stick to for 20 years without

questioning it is much better than a

strategy that's supposedly more optimized on paper.

You'll make changes every

6 months and then you

might give up because it's

too complicated. Maybe you'll

lose confidence in what you're

doing. You'll doubt yourself at some point;

for example, you've added juice to the

bridge, and you'll say, "Did I do the right thing

or not?" Did I miss the

emerging market positions or not? So

, the first question is

simplicity. The second question is, do I have

a problem with the

weightings? Am I comfortable

with 73% of the

US, 73% of the dollars?

Because ultimately, the best

question to avoid settling for just one

global TF is this: whether we

think there's too much or too little US

, too much or too little

Europe, Japan, Asia, and so on. And

naturally, if you have a problem with

the weightings of your global TF

today, that can be a good

reason to have your own

TF portfolio. But let's be clear, you're

voluntarily deciding to deviate

from the market. It's not a

neutral optimization; it's truly a

geographical choice, a strategic choice.

You shouldn't have regrets. You shouldn't

reduce the US to 50% and then

turn around two years later and say, well,

I missed the boat, and so on. And then the

third question, an obvious one,

is: do I want

emerging markets? And here you have to be careful

because this notion of an emerging market has

changed a lot in the minds of

investors. When I

started investing, you know, I

'm an old-timer, so I was in the late

90s, early 2000s,

emerging markets were really just a collection of

small developing economies.

That's it, it was risky, it was unstable,

it was a bit of an exception, but China

was small, everything was small in fact, it was

Vietnam, Brazil, and

so on. Whereas today, it's

much more complicated because not

having emerging markets is a real

choice. It's not just that I'm depriving myself of a

few small, exotic markets; we're

also depriving ourselves of some of the

biggest economies on the planet. We're

depriving ourselves of China, we're depriving ourselves From India, and what

I find even worse,

in quotes, is Taiwan and

South Korea. We're depriving ourselves of huge companies. I was

talking about TSMC, which is, after all,

the leading foundry in the

semiconductor world, a sector that's

booming right now. We're depriving ourselves of

companies like Samsung. So it's

really a choice. And what you have to

understand is that this "developed"

or "emerging" category is solely the choice

of an index issuer—well, not an

issuer, sorry, an index creator

like MSI. They don't consider whether it's

a rich country or not.

What they look at is the

size of the stock market, its

liquidity, the currency, and how

accessible the market is. Then there are

very technical things like

settlement, delivery of securities, and

so on. If you want a

truly broader index that will

include emerging countries, that exists.

It exists. We no longer talk about global ETFs, we

often talk about ACWI ETFs, which stands for All

Countries World Index. These are

indices that

combine developed and

emerging countries. They include all

the issuers, all the major ones. So

you'll find them at Vanguard and

Amundi. And it changes things quite a bit

. For example, if I look at

the top holdings of this

ACWI index, we find

TSMC, the famous

semiconductor foundry, in the 7th position in the

portfolio. And globally, the

United States is down 63%. So we

realize that there's a real

advantage to this

global ETF. The problem is that, to

my knowledge at least, it doesn't exist

in PEA accounts and it's even quite rare to

find it in life insurance policies. So that's why we're somewhat

forced to either accept the The drawbacks of a

global ETF are,

for example, having to create your own by adding a

separate component. You could take

an emerging market ETFPA, for instance. But you

see, with all the questions

we've been asking ourselves since the beginning, we

realize that every time we

delve a little deeper into the concept

of passive management, it becomes more

nuanced. In fact, we're always making

choices. Even a global ETF is

a choice in itself. It's a choice of market

capitalization weighting. It's the

choice to have a large US portfolio, and

as I said, it's primarily the

choice to exclude emerging markets.

Incidentally, I don't know if you've seen,

but a few days ago, Amundi

launched a GDP-weighted ETF, and that

completely changes the weightings.

The US drops

to 31%, China rises to 17%,

Germany and Japan, for example, are

next at around 4%, and after that...

would have been spread much more widely

among the other economies, and we even have

a total of 4,200 companies. But be

careful, it's not a solution to everything.

And besides, I'm very wary

of this notion of

GDP weighting because the philosophy

is completely different. But, uh, that's

not really the purpose of this video.

Maybe I'll make a video dedicated

to this GDP-weighted ETF. When

you invest in ETFs, you have to be

aware that absolute passive management doesn't

really exist. There's

always an initial decision. A

global ETF is an initial decision

with biases towards emerging markets, with whether

or not to hedge against currency fluctuations, and so on. But you have to admit

that if what you're looking for is

simplicity, if you want to do your

little monthly trading on a single stock,

then the global ETF is extremely

difficult to beat, not in terms of

performance, although yes, it's

difficult to beat in terms of

performance, but especially in terms of

simplicity. And It's not that it's

perfect, but above all it prevents you from asking yourself a

lot of questions every

month. It prevents you from saying every month or every

two months or every day,

"Do I have too much

Europe? Don't I have too much

of the United States? Is it a

problem not to be focused on emerging markets?

Do I have too much or not? Assz Japan

and so on." And in the end, it all

depends on your philosophy. Either you

say to yourself, "I take the market as it

is with its flaws, with its

American domination, with its lack

of emerging markets and so on, and I prioritize

simplicity." Or you say to yourself, "

I want to adapt this market to my vision."

I want to lose some weight, I want to

gain some. I want to add

missing areas and so on. sometimes even

live actions saying well,

what interests me is not the

emerging trends and especially TSMC for example,

but there are really two

different philosophies. One philosophy is truly a

follower approach, and another is where you start

to inject a little conviction because

ultimately the real question is

really whether you want to buy

the market or whether you want to

choose your market? So now

tell me in the comments which

team you're on. Are you

more into global ETFs or do I prefer to create my own

strategy? I admit that I have both

approaches. That is to say, in certain

life insurance policies that I do not want to

touch. I'm going to have global ETFs and that's all

.

[grunt]

And uh in other portfolios, I

'll have a mix of TF SP500 Europe

emerging and so on, plus obviously

direct shares, but that's

another story. That's all for

today. Don't forget that if you

listen to me on podcast, I'm always

very open to notes on Apple

Podcasts, Spotify and so on, on

YouTube, you know, it's my

historical platform, so you know that I really like

likes, comments

too and then don't hesitate to

subscribe, it doesn't make you receive

all the videos. For that, you have to

activate the little bell, but you

know the story of knowing how to

see all this feedback from

my audience, that's what motivates me to

try to keep up the pace which is not

always easy, I won't hide it from you,

knowing that I do everything myself, I

am really all alone from the writing,

the script, to the thumbnail, to the editing and

everything. So it's still quite a lot of

work, but it continues to

fascinate me. So, getting your

feedback, especially in the comments,

is always really great for me. Okay

, see you soon.