Which region to add to UK?

24th Nov '17 by HumourMe

13 comments 4948 reads

I'm trying to decide between Europe and US. One seemingly based on geography and the other on language. Oh number of shares was a factor too!

What basis do people use when considering which region to add and what has the experience been like? Typically do candidate numbers improve in proportion and/or have you imposed stricter criteria?

If technical and fundamental criteria are met I'll buy so I'm indifferent to market and my primary motivation is to add candidates to review. I don't do in depth analysis and try to avoid bulletin board comments influencing my decision so an inability to comprehend news releases may be an advantage to me.

Is one market inherently more volatile than the other?
What are the typical update periods (US quarterly, Europe?) ?
What are spreads typically like?

Any views welcome before midnight!

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Daniel Rudd

24th Nov '17

The EU stock ranks has outperformed the US so far. StockRanks Performance

Rusty2

I would choose Europe also. It has performed much better than the US in terms of Stockopedia 90-100 ranking, see performance.
I added it last year, have picked up about 5 that have gone up over 50%, there are more choices than the UK market. Have not added US, can find information elsewhere for most I'm interested in.

PhilHofGrowYourDough

Europe for me!

Howard Adams

Hi

Roland Head has started to discuss doing an international SIF (Stock In Focus) portfolio.

In his thread yesterday, I posted a summary of some results I have had from setting up a SNAPS type portfolio this time last year (29/11/16) across the three markets of US, Europe and UK. I did a virtual portfolio of 30 stocks (3 from each of 10 sectors - but only best three so one sector might be all from one market ) and have not changed any holdings over the course of the year.

The results are summrised in post #1 here in Roland's article https://www.stockopedia.com/content/will-my-international-sif-portfolio-beat-uk-stocks-243903/

From this experience I concur with Herbie & PhilH above, Europe might be best option. (if you have not already done so, look at Herbie's & then PhiH's fantasy portfolio's https://www.stockopedia.com/fantasy-funds/herbies-growth-fund-7058/ and here https://www.stockopedia.com/fantasy-funds/philhs-fund-4060/ They might be too modest to point them out)

At a macro level US is highly valued, Europe less so. At present, Europe's potential for growth over the near future seems to be gaining traction, America's seems to be less clear cut (but never write the US off).

Having made these points, I augment my UK holdings with both US and Europe holdings. I like the extra diversity. US has world-beating companies at all levels and sectors (you just need to work differently to find them). I have a closer affinity with many European companies than I do US therefore feel more confident in this space than US. I think as an investor I need to become completely international to position myself for the increasing globalisation of the world. So want to push myself to broaden my horizons in individual equities.

I hope this adds into your thoughts. I added US and Europe at last years offer and don't regret it for a moment. The investment has repaid itself many times over.

Regards
Howard

HumourMe

Thank you all for your comments. I took the plunge with adding Europe and like the expansion of the choices my screens now return.

Timmytrump

Earlier this year, having Euros to spare, I added Europe and set up a portfolio €200k using SNAPS screening. Purchased shares, using Saxo Capital Markets, in July and, with ups and downs, am showing 5% gain to date, excluding dividends.
What surprised me was the choice of stocks with high Stockranks compared with UK. Also, most have a decent dividend too; always nice but, I appreciate, Can be tax complicated.
Am very satisfied with the Europe service, both from Stockopedia and Saxo.

Vsihv

HL have stopped including US active managers in their top funds because (and I paraphrase) the efficient market hypothesis holds most true in the US given the amount of research and number of managers. Do with that info what you will! From a portfolio perspective by excluding US from the portfolio outright, I'd suggest you are taking a lot of passive:active risk (probably not the technical term). If it was me, I'd go with Europe (less wild west, less researched and some great businesses)

Having had a quick play I was pleased to discover that I could tighten criteria and still get sufficient candidates with my existing screens. Candidates were added roughly in proportion to the populations added.

The Guru strategies now report returns for both selections providing further evidence of prior returns (although a certain amount of correlation would be expected and black swan events also occur so divergence is the only meaningful result that might raise a flag). They are even more useful now as a start point, before adding pet criteria to 'improve' them.

For screening results it is clear what you are looking at and there are several reminders (the flags are now useful).

Stocko should really find a way to offer a trial for this. I would have got off the fence a lot earlier.

ISAallowance

"Stocko should really find a way to offer a trial for this. I would have got off the fence a lot earlier."

I think they do - when I signed up for UK+US I got all of world for the first 2 weeks.

I think the trial is only for new subscribers, I spoke to Ed about this last year. If you only have a month before your renewal then you can add it for 1 month, as it's pro rata. Yes I would have upgraded sooner with a free trial.

Redrichmond

Personally did both.. I trade with H@l so in pounds into a british bank account

I now stick just with the Uk and now watch US shares but learnt from my mistake

Apart from currency hit (unless you buy in euros and put into a euro bank account and or have a US account and put into a US account then maybe its okay but the uS dividend tax is nonsense for a UK citizen) I kept getting hammered whenever there was euro elections or US governents made changes or other countries effecting US shares made the pound vs the $ or £ v € go up and down like a yoyo

Its hard enough to follow the UK goverment but trying to follow europe and the US was impossible..

After reading 9 books out of the 60 odd guru screens. Im sticking to what I know although shares is a lifetime learning

My 50p worth

JohnEustace

Most of my returns for the last few months have come from US stocks.
I keep a dollar trading account with TD Direct (now Interactive Investor) so I only pay the currency conversion when adding or withdrawing funds, not on every trade.
As for exchange rates, I take the view that I get some natural hedging. A lot of our input costs are dollar denominated - energy, commodities, etc. so given that the bulk of my income is in pounds having a bit of exposure to dollar earnings helps smooth things provided I take a long term view.

jonesj

UK + Developed Asia.

Which region to add to UK?

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HumourMe

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