Author Topic: 401k Investing Options  (Read 3550 times)

Mephistopheles

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Re: 401k Investing Options
« Reply #10 on: August 18, 2020, 04:40:50 PM »
I had my 401k 1/3 each in s&p 500, mid, and small cap because I was hoping to get a full market exposure as opposed to just the largest 500 companies.

But I hear that the 500 is a better bet because it has an advantaged survivorship bias in that only the best companies can get that large. The mid and small caps will have a lot more busts over time.

Thoughts?


clutch

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Re: 401k Investing Options
« Reply #11 on: August 18, 2020, 04:59:17 PM »
I had my 401k 1/3 each in s&p 500, mid, and small cap because I was hoping to get a full market exposure as opposed to just the largest 500 companies.

But I hear that the 500 is a better bet because it has an advantaged survivorship bias in that only the best companies can get that large. The mid and small caps will have a lot more busts over time.

Thoughts?

Just listen to Buffet? ;-)

RadMan24

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Re: 401k Investing Options
« Reply #12 on: August 18, 2020, 05:02:49 PM »
Did Munger actually say that or is that speculation?

Munger's three biggest investments in his life are Berkshire, Costco and Li Lu (China) and has repeatedly said investors don't have enough exposure to China. What I referenced to Munger was reading between the lines. For what its worth, most 401ks don't even offer direct exposure to China so its a non-event, but if you were to have a Roth/IRA - it's worth considering given the low cost ETFs available. 

LearningMachine

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Re: 401k Investing Options
« Reply #13 on: August 18, 2020, 10:05:49 PM »
Did Munger actually say that or is that speculation?

Munger's three biggest investments in his life are Berkshire, Costco and Li Lu (China) and has repeatedly said investors don't have enough exposure to China. What I referenced to Munger was reading between the lines. For what its worth, most 401ks don't even offer direct exposure to China so its a non-event, but if you were to have a Roth/IRA - it's worth considering given the low cost ETFs available.

Investing in a Chinese ETF is different from making specific investments in China.  Probability is high for Chinese economy to keep growing long term while not rewarding shareholders.

undervalued

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Re: 401k Investing Options
« Reply #14 on: August 18, 2020, 10:39:06 PM »
Did Munger actually say that or is that speculation?

Munger's three biggest investments in his life are Berkshire, Costco and Li Lu (China) and has repeatedly said investors don't have enough exposure to China. What I referenced to Munger was reading between the lines. For what its worth, most 401ks don't even offer direct exposure to China so its a non-event, but if you were to have a Roth/IRA - it's worth considering given the low cost ETFs available.

Which ETF/Index fund do you consider for China?
Don't gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it. - Will Rogers

RadMan24

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Re: 401k Investing Options
« Reply #15 on: August 18, 2020, 10:57:43 PM »
Did Munger actually say that or is that speculation?

Munger's three biggest investments in his life are Berkshire, Costco and Li Lu (China) and has repeatedly said investors don't have enough exposure to China. What I referenced to Munger was reading between the lines. For what its worth, most 401ks don't even offer direct exposure to China so its a non-event, but if you were to have a Roth/IRA - it's worth considering given the low cost ETFs available.

Which ETF/Index fund do you consider for China?

MCHI will cover China's large tech companies BABA, Tencent, and others.
CNYA will cover CSI 300 - mainland index a-shares (this is like investing in domestic small caps, you won't get much exposure to big tech names).
FXI is another option, captures top 50 China/Hong Kong excludes Baba, JD, among other listings. 

There could be cheaper options eventually than just using iShares.

Mutual Fund - Fidelity China Region is another good option.

Individual stock selection in China usually requires a little bit of cloning strategy, less you have deep knowledge of that market.

I once did a deeper dive about Li Lu, what he has to say about investing in general, as well as books he has recommended people read to gain a new perspective on China. This is definitely recommended. There's a thread on this forum about him as well, fairly recent too.

With all that said, as Buffett notoriously notes, most of the S&P 500 companies gain you exposure internationally, and to China, like Apple.