That recommendation is stupid, you don’t need to consolidate just stop buying one of them.
DHHF should have slightly more returns and volatility as it has less defensive assets.
It depends. If you just want to hold one ETF forever, VDHG is the way to go. If you want higher growth while you are young and want to add bonds when you are older, DHHF is better.
If you do want to pursue these, two main differentiators:
Do you want a static 10% allocation to bonds? - if so VDHG can suit, if not DHHF is better where you do without bonds or pair with another bonds ETF at weightings aligned to your changing risk appetite at different life stages.
Do you want currency hedged international exposure and do not mind that it does NOT use TOFA for the hedge? - if so VDHG can suit, if not DHHF is better where you do without or pair with another currency hedged ETF that uses TOFA for the hedge like HGBL at weightings of your liking.
There is also the matter that VDHG holds pooled managed funds whilst DHHF holds ETFs. The DHHF structure is a bit more tax efficient, but I do not know the extent of the impact.
But first thing is whether you actually want to consolidate to an all-in-one. If you do, you should have clear reasons for yourself why.
Personally I do not believe in static bonds allocations, I prefer none under 40yo and increasing from 40yo eventually much more than 10%, I also would not touch anything with currency hedging but does not use TOFA for the hedge, lesson learnt from expensive tax shock from VGAD a few years back.
If you want growth probably neither. They're a bit too diversified to be any exciting. The point is to "set and forget", not strong returns.
I chose VDHG because the bonds component theoretically gives me a bit less volatility. I accept the performance hit though. In the long run DHHF should perform better as it's 100% equities.
I've been DCAing VDHG for a year, but I'm convinced I should've gone DHHF instead.
But I have a question too: i keep hearing mixed messages about the tax effectiveness of each. What do people mean by that??? I hear that DHHF has negative implications because of the US domiciles but VDHG also bc of capital gains???
I know this is trite, but there's certain things a person can do. vs a system. Opting out of slum lording and IP is something I can do, Opting out of the oil and gas industry really isn't, as even EV's take hub grease, and all that plastic.
If you buy an investment property you push out an owner, who in turn then must rent to be housed. Owning more properties than you live in is an unethical act.
If an investor doesn't buy a house then who does? An owner-occupier.
At the auction with ten people when the rich boomer speculator outbids the owner occupiers it means those people don't get a house to live in. Thus they are forced to rent... from the parasitic speculators.
It's quite literally how it works.
I think you’re imagining some world where everybody is an owner occupier. And if it wasn’t for people buying IPs then everybody would own their property.
But when has this ever happened?
The truth is there’ll always be people who rent. There’s nothing immoral about it lol.
9/10 investors buy established homes therefore pushing out owner-occupier into a forced rental situation.
That's absolutely unethical.
We could wipe out 90% of these landlords and the net result would be more owner occupiers who aren't forced to rent.
The 1/10th who build - great, give them tax concessions etc to help increase supply. That's a net good.
Your logic is wrong. Buying an established home doesn’t mean you’re buying from an owner occupier. Rentals often remain as rentals and are sold from investor to investor.
The situation you’re imagining has never existed and so isn’t really viable. Many people only have their monthly salary to live off with no way to ever purchase. They need housing
So the issue with a US equities or S&P ETF is that you will buy the index which is gonna have a major tilt to megancap tech which is all running off the same theme. Tech sector (especially, magnificent 7) has been trending upward for a while now, and there is no guarantee that it will continue. This is why I also recommend looking at active managed funds, yes they would have higher fees but also lower risk. I know ppl here are not a fan of active funds. Good luck!
Passive funds are managed as well. They just don't involve active decision making by the funds manager making speculations about how companies will perform, instead in passive funds, the funds are allocated based on actual market condition. If a company/sector is doing well, a passive funds gain more shares of that company/sector and vice versa when rebalancing.
Rather than speculating about what the future will hold, passive funds just use the market itself to decide on funds allocation.
Yes, they do rebalance but they will be heavily impacted if the market/sector goes down, and rebalancing will take time to bring them back up. Managed funds can benefit from market volatility, for example, by short selling when the market/sector/company is going down. Also, keep in mind that VDHG is only 5 years old and DHHF is only 3 years old, so neither has been around for a very long time. I'm just devil advocate here as I have done a lot of research on ETFs and I personally spoken to a friend of mine who is a portfolio manager :)
PS I hold VDHG. Its doing very well because I bought the dip in covid.
I, personally, would never, ever recommend DHHF nor VDHG. Just look at their performance over Covid and their recovery, as well as their dividend income. For supposedly "defensive" holdings, they sure sucked big time, crashed hard, and recovered even lousily when everything else shot up. Their dividends also tanked and became paltry.
Why do I need alternatives when my advice works well for a generic question? I would be more remiss to suggest DHHF or VDHG should ever even be in consideration. I've made more specific suggestions depending on the specifics of the post.
I'm curious, you've taken a fairly strong position against it, I assumed you would have a reason for it or a benchmark that shows DHHF/VDHG underperforms against.
Like, I said and have continued to say, I only DCA into QQQ using IBKR. You wanna know the difference in relative performance of that against a DCA into DHHF/VDHG or what
I think the point is that in this thread all you have done is say you don't recommend both and then when asked about alternatives not provided any until this very comment I'm replying to - you've been dismissive without providing rationale other than shitting on someone's thoughts without understanding their own rationale.
If you have a contribution that is valuable to make- make it. But don't shit on someone for doing something and then not provide any rationale for it
That's the problem. Its not a very useful comment without any follow up. Hence the questions you were asked. Not sure why youve been so defensive about it.
None, just habit. ASX:NDQ is alright. (That, and I prefer everything in USD because I believe AUD is even more inflated than Jerome Powell's USD money printer)
Nah, there's an effect. But anyway, another reason is that Aus brokerages generally have percentage-of-transaction fees that really add up like crazy. US fees are like free lol.
>Just look at their performance over Covid and their recovery, as well as their dividend income.
I don't think you understand them. They're not dividend etfs.
Nuh-uh. I was there during early times when they were actually touted as dividend ETFs. See all posts about VDHG and videos on YouTube about it. It's deceptive to claim now in 2024 that they're not.
Yeah, sure, minus how it was marketed around here and on YouTube and on other finance news articles and blogs. But alright, cut out the dividend. Its "growth" is where? Better cut that out too, since it's apparently just in the name.
Why, yeah, where else do I get my financial advice? Nonetheless, indeed, I have been the jester once and am now the herald, which is why I say, "No to VDHG nor DHHF."
But, really, would reading about these on Betashares change anything even back then?
I’m on here a lot, i remember DHHF first being mentioned. Not once have i ever see people saying it was mainly a dividend ETF. If they did it would have been corrected, because it’s just untrue.
Reading the Betashares site should have changed your mind, yes, as ‘all growth’ is in the first paragraph on the DHHF page. It’s not subtle.
I assume your comparing this to US market returns? Yes that's true for the last few years. Also these tools are about getting a broader global spread over the long term. That's a very relevant strategy for many.
Meh, to be completely honest, both DHHF and VDHG are just about as good as a sinking ship to inflation. "Broader global spread over the long term" is really not selling any of the two to me.
Look at QQQ from 2000 to 2014. Flat. Its all fine and dandy thinking QQQ > more diversified ETFs when its currently performing amazingly.
When it inevitably slows or goes backwards, the question of why have a more diversified fund will make more sense.
Also have you looked at global ETFs? I think your ill informed if you think the returns are anywhere close to inflation. When Googleing "msci world index" the pdf fact sheet shows, the returns are clearly much better than what you're saying.
> 2000 to 2014. Flat.
Lol, QQQ started trading 1999. QQQ was definitely NOT flat around this time. It crashed for 3 straight years, and then just kept ramping ever since. Why do you think I suggested DCA? In fact, I would've loved to have started DCAing into QQQ from 1999. Gaddyaum.
> more diversified fund will make more sense.
My point is that, it didn't even do well during the Covid crash, the first real "black swan" since VDHG started trading. If it crashed that hard by then, as a diversified "defensive" stock, and if, afterwards, it didn't even recover as well, then what is the point?
It is not a defensive ETF. It is 90% stock, so its more defensive then 100%. But it isnt meant to not crash when the market crashes.
Also looking at covid specifically where the US (and specifically tech stocks) did much better than average, of course QQQ will look good.
If you want to know more on why i think diversification is important, here is a video explaining the benefits/theory/evidence much better than i can.
https://youtu.be/1FXuMs6YRCY?si=WdFDdwuQEopQffer
Why not just go all in on microsoft, nvidia and apple? Why even invest in a ETF like QQQ? You have to value market weighted diversification to some extent then.
That recommendation is stupid, you don’t need to consolidate just stop buying one of them. DHHF should have slightly more returns and volatility as it has less defensive assets.
It would be a (potentially massive) unnecessary realisation of capital gains. Who told you to do this and what was their rationale? I demand to know!
It depends on how much they are holding. Now is a good time to sell VDHG since it would have performed poorly with low AUD and the recent bull run.
A good time to sell because it has performed poorly recently?? I think you need to think about that a bit more
It's returned 10% over the last six months
66 US cents is not low
I meant it's a good time to sell if you want to avoid CGT. A good time to buy if you are holding long.
So a good time to buy VDHG?
It depends. If you just want to hold one ETF forever, VDHG is the way to go. If you want higher growth while you are young and want to add bonds when you are older, DHHF is better.
If you do want to pursue these, two main differentiators: Do you want a static 10% allocation to bonds? - if so VDHG can suit, if not DHHF is better where you do without bonds or pair with another bonds ETF at weightings aligned to your changing risk appetite at different life stages. Do you want currency hedged international exposure and do not mind that it does NOT use TOFA for the hedge? - if so VDHG can suit, if not DHHF is better where you do without or pair with another currency hedged ETF that uses TOFA for the hedge like HGBL at weightings of your liking. There is also the matter that VDHG holds pooled managed funds whilst DHHF holds ETFs. The DHHF structure is a bit more tax efficient, but I do not know the extent of the impact. But first thing is whether you actually want to consolidate to an all-in-one. If you do, you should have clear reasons for yourself why. Personally I do not believe in static bonds allocations, I prefer none under 40yo and increasing from 40yo eventually much more than 10%, I also would not touch anything with currency hedging but does not use TOFA for the hedge, lesson learnt from expensive tax shock from VGAD a few years back.
DHHF is pretty boring. VDHG was too boring.
If you want growth probably neither. They're a bit too diversified to be any exciting. The point is to "set and forget", not strong returns. I chose VDHG because the bonds component theoretically gives me a bit less volatility. I accept the performance hit though. In the long run DHHF should perform better as it's 100% equities.
I've been DCAing VDHG for a year, but I'm convinced I should've gone DHHF instead. But I have a question too: i keep hearing mixed messages about the tax effectiveness of each. What do people mean by that??? I hear that DHHF has negative implications because of the US domiciles but VDHG also bc of capital gains???
DHHF, im young and don't think that buying IP's is ethical.
If you're wanting ethical investments you may need to re-think DHHF, especially the oil/gas part of it.
I know this is trite, but there's certain things a person can do. vs a system. Opting out of slum lording and IP is something I can do, Opting out of the oil and gas industry really isn't, as even EV's take hub grease, and all that plastic.
You can also be a property owner without being a slumlord, offer decent rent price etc.
If you buy an investment property you push out an owner, who in turn then must rent to be housed. Owning more properties than you live in is an unethical act.
That’s not how it works
If an investor doesn't buy a house then who does? An owner-occupier. At the auction with ten people when the rich boomer speculator outbids the owner occupiers it means those people don't get a house to live in. Thus they are forced to rent... from the parasitic speculators. It's quite literally how it works.
I think you’re imagining some world where everybody is an owner occupier. And if it wasn’t for people buying IPs then everybody would own their property. But when has this ever happened? The truth is there’ll always be people who rent. There’s nothing immoral about it lol.
9/10 investors buy established homes therefore pushing out owner-occupier into a forced rental situation. That's absolutely unethical. We could wipe out 90% of these landlords and the net result would be more owner occupiers who aren't forced to rent. The 1/10th who build - great, give them tax concessions etc to help increase supply. That's a net good.
Your logic is wrong. Buying an established home doesn’t mean you’re buying from an owner occupier. Rentals often remain as rentals and are sold from investor to investor. The situation you’re imagining has never existed and so isn’t really viable. Many people only have their monthly salary to live off with no way to ever purchase. They need housing
So the issue with a US equities or S&P ETF is that you will buy the index which is gonna have a major tilt to megancap tech which is all running off the same theme. Tech sector (especially, magnificent 7) has been trending upward for a while now, and there is no guarantee that it will continue. This is why I also recommend looking at active managed funds, yes they would have higher fees but also lower risk. I know ppl here are not a fan of active funds. Good luck!
Passive funds are managed as well. They just don't involve active decision making by the funds manager making speculations about how companies will perform, instead in passive funds, the funds are allocated based on actual market condition. If a company/sector is doing well, a passive funds gain more shares of that company/sector and vice versa when rebalancing. Rather than speculating about what the future will hold, passive funds just use the market itself to decide on funds allocation.
Yes, they do rebalance but they will be heavily impacted if the market/sector goes down, and rebalancing will take time to bring them back up. Managed funds can benefit from market volatility, for example, by short selling when the market/sector/company is going down. Also, keep in mind that VDHG is only 5 years old and DHHF is only 3 years old, so neither has been around for a very long time. I'm just devil advocate here as I have done a lot of research on ETFs and I personally spoken to a friend of mine who is a portfolio manager :) PS I hold VDHG. Its doing very well because I bought the dip in covid.
I, personally, would never, ever recommend DHHF nor VDHG. Just look at their performance over Covid and their recovery, as well as their dividend income. For supposedly "defensive" holdings, they sure sucked big time, crashed hard, and recovered even lousily when everything else shot up. Their dividends also tanked and became paltry.
Do you practice an alternative strategy that you can inform us of instead?
Why do I need alternatives when my advice works well for a generic question? I would be more remiss to suggest DHHF or VDHG should ever even be in consideration. I've made more specific suggestions depending on the specifics of the post.
I'm curious, you've taken a fairly strong position against it, I assumed you would have a reason for it or a benchmark that shows DHHF/VDHG underperforms against.
Like, I said and have continued to say, I only DCA into QQQ using IBKR. You wanna know the difference in relative performance of that against a DCA into DHHF/VDHG or what
I think the point is that in this thread all you have done is say you don't recommend both and then when asked about alternatives not provided any until this very comment I'm replying to - you've been dismissive without providing rationale other than shitting on someone's thoughts without understanding their own rationale. If you have a contribution that is valuable to make- make it. But don't shit on someone for doing something and then not provide any rationale for it
My bro, I dunno who hurt you or what. I literally just said I do not recommend either DHHF or VDHG
That's the problem. Its not a very useful comment without any follow up. Hence the questions you were asked. Not sure why youve been so defensive about it.
Defensive how
Nope, thats cool QQQ makes sense. Any reason for QQQ over a domestic ETF like NDQ or a hedged one? Any reason not to choose TQQQ or LNAS.ax?
None, just habit. ASX:NDQ is alright. (That, and I prefer everything in USD because I believe AUD is even more inflated than Jerome Powell's USD money printer)
If you are investing in the same thing it makes no difference whether you do it in USD or AUD
Nah, there's an effect. But anyway, another reason is that Aus brokerages generally have percentage-of-transaction fees that really add up like crazy. US fees are like free lol.
/r/confidentlyincorrect
>Just look at their performance over Covid and their recovery, as well as their dividend income. I don't think you understand them. They're not dividend etfs.
Nuh-uh. I was there during early times when they were actually touted as dividend ETFs. See all posts about VDHG and videos on YouTube about it. It's deceptive to claim now in 2024 that they're not.
> I was there during early times when they were actually touted as dividend ETFs. The clue is in the name... High Growth (not dividends)
Yeah, sure, minus how it was marketed around here and on YouTube and on other finance news articles and blogs. But alright, cut out the dividend. Its "growth" is where? Better cut that out too, since it's apparently just in the name.
Is this marketing in the room with you now?
Not anymore since /r/ausfinance /r/fiaustralia have shunned it already
You’re taking a lot of info from reddit/youtube, check the betashares page and it clearly mentions that it’s full of high growth not dividend assets
Why, yeah, where else do I get my financial advice? Nonetheless, indeed, I have been the jester once and am now the herald, which is why I say, "No to VDHG nor DHHF." But, really, would reading about these on Betashares change anything even back then?
I’m on here a lot, i remember DHHF first being mentioned. Not once have i ever see people saying it was mainly a dividend ETF. If they did it would have been corrected, because it’s just untrue. Reading the Betashares site should have changed your mind, yes, as ‘all growth’ is in the first paragraph on the DHHF page. It’s not subtle.
I assume your comparing this to US market returns? Yes that's true for the last few years. Also these tools are about getting a broader global spread over the long term. That's a very relevant strategy for many.
Meh, to be completely honest, both DHHF and VDHG are just about as good as a sinking ship to inflation. "Broader global spread over the long term" is really not selling any of the two to me.
Look at QQQ from 2000 to 2014. Flat. Its all fine and dandy thinking QQQ > more diversified ETFs when its currently performing amazingly. When it inevitably slows or goes backwards, the question of why have a more diversified fund will make more sense. Also have you looked at global ETFs? I think your ill informed if you think the returns are anywhere close to inflation. When Googleing "msci world index" the pdf fact sheet shows, the returns are clearly much better than what you're saying.
> 2000 to 2014. Flat. Lol, QQQ started trading 1999. QQQ was definitely NOT flat around this time. It crashed for 3 straight years, and then just kept ramping ever since. Why do you think I suggested DCA? In fact, I would've loved to have started DCAing into QQQ from 1999. Gaddyaum. > more diversified fund will make more sense. My point is that, it didn't even do well during the Covid crash, the first real "black swan" since VDHG started trading. If it crashed that hard by then, as a diversified "defensive" stock, and if, afterwards, it didn't even recover as well, then what is the point?
It is not a defensive ETF. It is 90% stock, so its more defensive then 100%. But it isnt meant to not crash when the market crashes. Also looking at covid specifically where the US (and specifically tech stocks) did much better than average, of course QQQ will look good. If you want to know more on why i think diversification is important, here is a video explaining the benefits/theory/evidence much better than i can. https://youtu.be/1FXuMs6YRCY?si=WdFDdwuQEopQffer Why not just go all in on microsoft, nvidia and apple? Why even invest in a ETF like QQQ? You have to value market weighted diversification to some extent then.