Global equities with a weak £

[simong800]

Hi All,

I am not one to try to play the FX game, time the market, or do anything too clever - I have a reasonable size 100% equity portfolio which is simply 45% global trackers, a small handful (4) active global equity funds and 10% exposure to private equity.

However, my portfolio probably reflects the global index in so much as most of it isn't in GBP, and the GBP being so weak is giving me pause for thought before dumping £10k into the market to fill my wife's S&S ISA.

Is anyone doing anything differently considering the weakness of the £ and the fact a global tracker or fund gets you a heap of holdings priced in USD?

Main consideration is whether I'd be better off buying global tracker hedged to GBP such as IGWD;

https://www.ishares.com/uk/individual/en/products/...

Would welcome any thoughts!

[Panamax]

I'll be interested to learn the answer as I dumped a lot of UK when Boris Johnson came on the scene.

I'm particularly heavily invested in North America so wondering whether there will be benefits from the FX situation.

Equally, I well understand that many FTSE100 companies will benefit from the increased ££ of their foreign earnings.

[Derek Chevalier]

si800 said:

Hi All,

I am not one to try to play the FX game, time the market, or do anything too clever - I have a reasonable size 100% equity portfolio which is simply 45% global trackers, a small handful (4) active global equity funds and 10% exposure to private equity.

However, my portfolio probably reflects the global index in so much as most of it isn't in GBP, and the GBP being so weak is giving me pause for thought before dumping £10k into the market to fill my wife's S&S ISA.

Is anyone doing anything differently considering the weakness of the £ and the fact a global tracker or fund gets you a heap of holdings priced in USD?

Main consideration is whether I'd be better off buying global tracker hedged to GBP such as IGWD;

https://www.ishares.com/uk/individual/en/products/...
https://www.dimensional.com/us-en/insights/to-hedg...

Would welcome any thoughts!

https://intl.assets.vgdynamic.info/intl/australia/documents/research/brief-to-hedge-or-not-tlrv.pdf
https://www.dimensional.com/us-en/insights/to-hedg...

I've not come across many that hedge equity and, conversely, choose not to hedge (global) bonds.

Edited by Derek Chevalier on Wednesday 28th September 08:40

[simong800]

Derek Chevalier said:

https://intl.assets.vgdynamic.info/intl/australia/...

I've not come across many that hedge equity and, conversely, choose not to hedge (global) bonds.

Edited by Derek Chevalier on Tuesday 27th September 18:38

Thanks for the link Derek, an interesting read.

Given I have zero home bias, a v.small % of overall portfolio in GBP, access to what appears at first glance (though need to review further) a reasonably priced hedged ETF and the potential ongoing volatility of GBP based on the article I think I have a case for at least "partial hedging".

I need to read it in more detail (have to admit I scanned it) but initial reaction is hedging say 10-15% of my portfolio could make sense....