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Savings & Investments Germany

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9 minutes ago, scook17 said:

you could largely replicate the fund by buying the largest shareholdings of that fund

 

I disagree. Funds have a certain balance between the small and large holdings.

 

If you decide to only buy stocks, diversification is still key. 

 

All of my funds are no-load so no cost or commissions when buying/selling.

 

I have a very good financial advisor who does all of my trading for me. Worth every cent he gets. When I started out and didn't have much, he didn't cost much. 

 

 

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1 hour ago, fraufruit said:

I disagree. Funds have a certain balance between the small and large holdings.

If you decide to only buy stocks, diversification is still key. 

All of my funds are no-load so no cost or commissions when buying/selling.

I have a very good financial advisor who does all of my trading for me. Worth every cent he gets. When I started out and didn't have much, he didn't cost much. 

Funds have a certain make up, either based on the fund manager, or based on some percentage reflecting the overall index.

You can see the makeup of a given fund at a given time. Just buy the same percentage of each stock. Funds usually have an annual management charge. Some of the better providers refund the commission paid on buy/sell/keep funds. It can be a lot and is often hidden in 'wonderful' financial language most people gloss over. Yes, when you start out, 1% of 1000 Euros is just a euro, but 100K euros is 1K euro in fees which is for what, buying some percentage of a stock index?

 

Diversification is a mechanism to mitigate risk and mitigate returns. In the end if diversification is a good or bad choice, depends on what you wish to do. For most people who pay someone else to 'take care of things', it's a good choice.

 

I personally like to understand things. If I decide it's not worth my effort, then I am happy to give that task to someone else, but only once I understand entirely what the task involves. This allows you to judge if the price being asked for is reasonable given what you know of the task at hand. If you know nothing, you are an uninformed buyer. If the 'salesman' tells you 'ah this xxx is the best thing ever to happen to the field of [vacuum cleaners]' then can you, realistically, independently, judge that claim? 

 

Dyson, btw, are worth every penny/cent they charge. But others copy and their lead will wither away with time. I once did a course to learn how to do block paving, and then how to build a wall. Realistically I have no reason to do this. Was fun. Learned a lot. But most of all I learned I didn't get back more than I put in, and I appreciated the skill of the people who did this well.

 

So one day I may well buy an index fund/managed fund and have owned them in the past along with individual shares. Personally I like to be more involved, but that's me.

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It sounds like you know what you want and what you're doing. I'm sure you'll do just fine.

 

I don't know how old you are but what is your end game? When I started investing many years ago, I want to be able to live off of my dividends in retirement.

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