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US ETFs are no longer diversification. Now that everybody is doing it, when market goes down ETFs will fall from sky as well at same or faster rates. More impor
by sytelus 9y ago
US ETFs are no longer diversification. Now that everybody is doing it, when market goes down ETFs will fall from sky as well at same or faster rates. More importantly, most ETFs are tied with one market, one country and one currency. For true diversification, you want to have gold, oil, Chinese, Russian, Asian along with usual American ETFs.
- pnathan 9y agoYou expose yourself to currency risk as well with that strategy. I primarily worry about single company failures and wobbles; if the US economy implodes, the rest of the world will be caught up in it. But you're right, you should balance with non-US as well. I've steered clear of them, myself, but that's not per se ideal practice and I'm overdue for a rebalancing. But, to be clear, I was sketching an entry level into investing, not a more sophisticated approach.