Pick your portfolio

Steve Cronin, founder of Wise (wiseuae.com) a non-profit organisation to help UAE expats invest their wealth, is campaigning to alert people to the dangers posed by 25-year investment plans.

He says expats would do far better building a small portfolio of low-cost passive funds that track key stock market indexes because they give you access to a diversified range of stocks and their low costs boost your overall investment return.

Funds in your portfolio should vary according to your attitude to risk and the investments you already hold, Mr Cronin says.


He has produced four sample portfolios for The National, each containing a balanced blend of five different funds covering asset classes and markets. The funds listed below boast total annual charges, as measured by the total expense ratio (TER) of as low as 0.2 per cent a year.

1. The Abra – slow, steady and cautious

20% inflation-linked government bonds (global): iShares Global Inflation-Linked Government Bond ETF USD (IGIL). Total expense ratio (TER): 0.25%

20% government bonds (global): iShares Global AAA-AA Government Bond ETF USD (IAAA). TER: 0.2%

20% short-term government bonds (US): iShares $ Treasury Bond 1-3yr ETF USD (CSBGU3). TER: 0.2%

20% corporate bonds (global): iShares Global Corporate Bond ETF USD (CORP 0.2%)

20% equities (global): HSBC MSCI World ETF USD (HMWO). TER: 0.15%

2. The Reliable Brunch – a conservative choice with a bit of everything

25% cash: in a long-term savings account,

25% long-term bonds: iShares $ Treasury Bond 20+ year ETF USD (IDTL). TER: 0.2%

25% equities (global): Vanguard FTSE All-World ETF USD (VWRD). TER: 0.25%

25% gold: iShares Physical Gold ETC USD (SGLN). TER: 0.25%

3. The Desert Safari – a great adventure that still gets you home safely

20% government bonds (global): iShares Global Government Bond ETF USD (IGLO). TER: 0.2%

20% corporate bonds (global): iShares $ Short Duration Corporate Bond ETF USD (SDIG). TER: 0.2%

50% equities (developed): Vanguard FTSE Developed World ETF USD (VDEV). TER: 0.18%

10% equities (emerging): Vanguard FTSE Emerging Markets ETF USD (VDEM). TER: 0.25%

4. The Supercar Roller Coaster – exhilarating but not for the over-50s

20% corporate bonds (global): iShares $ Short Duration Corporate Bond ETF USD (SDIG). TER: 0.2%

30% equities (developed): Vanguard FTSE Developed World ETF USD (VDEV). TER: 0.18%

30% value equities (global): Vanguard Global Value Factor ETF Shares USD (VDVA). TER: 0.22%

10% equities (emerging): Vanguard FTSE Emerging Markets ETF USD (VDEM). TER: 0.25%

10% small cap equities (US): iShares MSCI USA Small Cap ETF (CUSS). TER: 0.43%

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