Ignoring International Investments – Is Ian an Idiot?

Hi everyone, Ian here again!

That title might be a little harsh, but some of you are no doubt asking the question if you read my original post!

I’ve previously explained my strategy for index investing, which involves sticking to my home country of Australia.

You may be wondering, why on earth would I restrict myself to a region that only makes up around 3% of the world equity markets? Am I lazy? Patriotic? Or just plain ignorant?

Fair questions, but I actually have two reasons – and I’ll let you judge whether they’re compelling enough…

1) I’m Not Convinced Global Will Perform Better

History is always a useful starting point to set the scene. How has Australia fared over the years compared with the rest of the world?

I absolutely love this interactive chart from Vanguard. It allows you to compare the growth of $10,000 invested in different asset classes over any historic period since 1970. I’ve focused on shares in three different regions – Australia, US, and International – over a few different periods.

Let’s start with the performance since 2010:

(PS – that little straight line at the bottom is cash)

Introducing… Indexing Ian!

Hi everyone! I’m Ian, or ‘Indexing Ian’ as Frankie likes to call me.

You’ve heard Frankie’s Investment ‘F’hilosophy, so let me tell you a bit about mine. I haven’t always been an ‘Indexer’, in fact, for many, many years, I spent HUGE amounts of time analysing stocks, buying and selling, trying to time my investments perfectly. I’m a pretty smart guy, always thought of myself as ‘above average’ in many ways, and like Frankie, have plenty of experience in the finance industry, so I didn’t want to settle for an ‘average’ index fund – how BORING!…