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Alec: [00:00:07] Welcome to Bitesize in Get Started Investing. In this series, we feature some of our favourite lessons, quotes and moments from the podcast. If you'd like to listen to the full episode, we've included the link in the shownotes.
Bryce: [00:00:22] We're on the same page. I think, when it comes to the stance for this being an aggressive sort of portfolio construction. Yep. What I mean by that is heavily weighted towards equities as an asset class and then from your defensive assets such as fixed interest gold, I guess property might fall into that, less weighting towards that. So the big question is what is going to be the weighting? If you were to take it from an asset class point of view, not breaking it down into Aussie, US, Europe, etc. yet what would you consider to be your weighting mix?
Alec: [00:00:57] I think there's no right answer here. Obviously I want to be pretty aggressive, so I'd probably be saying 60% equities, 40%, everything else with not a lot of science. But that feels about right to me.
Bryce: [00:01:07] I mean, this is why we do the podcast together because I went away. I haven't spoken to you about this and I have done the exact same weighting, 60% equities, 40% other.
Alec: [00:01:16] Have you done 15-15-15-15-10-10-10-10? Okay. So without speaking to each other, we're completely aligned on how we would structure it. So just to explain the numbers that I just rattled off then. Of the 60%. There's four ETFs for international and Australian equity ETFs, and we basically have both independently said 15% weighting to each of them. So a 15% weighting to the US, 15% weighting to Australia, 15% weighting to Europe, and 15% weighting to Japan, and that equals 60% of the core portfolio.
Bryce: [00:01:52] Asia ex-Japan.
Alec: [00:01:54] Oh, sorry, did I say Japan? Yeah, that's my bad. So that 60% and then the remaining 40%, we've said 10% to the Australian Property ETF, 10% to the International Property ETF or International Infrastructure ETF, 10% to gold, 10% of fixed income. That gold and fixed income allocation potentially is a little bit aggressive.
Bryce: [00:02:15] The other component that we need to consider is are we leaving anything in cash as an asset class in itself? Because that is a consideration. If you think about your total portfolio, I personally have cash available and it makes up a percentage of my total portfolio. Maybe. Is it 5%? Is it? No. And not just for the purpose of the exercise and we'll have cash available in the satellite portfolio. What are your thoughts on that? It's a good
Alec: [00:02:37] Question. I mean, cash is a useful defensive asset for certain situations. When equity markets plunge, you know, cash gives you options, but it is also just it holds its value. It's not a bad call. Maybe we say 5% gold, 5% cash.
Bryce: [00:02:53] Or around 5% cash. So just to close this out, we're going 60% total weighting towards our equities, Aussie, US, Europe and Asia. And we will make this available online at some point. We're just getting the back end ready.
Alec: [00:03:08] I know we said that last time. Yeah, we didn't just ignore what we said. We just are figuring out the best way to show it on our website.
Bryce: [00:03:16] Yes, 10% in Aussie property, ten international property. Then we went to ten infrastructure, five gold, five cash. That's the 100%.
Alec: [00:03:25] Yeah. If Bryce's maths didn't quite add up there. Go to our website and check if it's available. Hopefully it will know.
Bryce: [00:03:31] If you enjoyed that Bitesize, you'll find a link to the full episode in the show notes.
