Finally starting Investing!

[Hárbarðr]

Hi,

I'll try to keep it simple.

It's been a year since my first beginners post, and then the Covid hit.
But i thought that I should get back on in and try to start investing, or at least do my research well from now.

My goal for investing:
Simply keep it long term, and get some gains for when i get older/ retire. Investing a few man yen every month.
Im 42 years old now. I have an account with Rakuten Security, and love the points (it helps pay for my gas bill, which is always from Rakuten)

My questions:

1: How do anyone go about choosing what to invest in? (as in, which stocks, or what kind of investments. I think a lot is individual based, but what are some of the key factors for your choices?)

2: How much would you invest monthly? (again, this is very subjective to ones salary and how much one can afford/ want to invest)

3: Is now a good time to start investing? or Should i hold on for, what ever really?

4: Any good advice, would be greatly appreciated.

Thank you again....

[RetireJapan]

Congrats on keeping at this. You just need to get started now, and the hard part is over.

1) I think the best thing most people can do is to invest in the stock market as a whole. This is the easiest thing to do, and has a good chance of success over the long term.
2) As much as possible without making your life miserable.
3) Best time to start was ten years ago, next best time is now. Don't try to time the market.
4) Start with small amounts so you can get used to investing and feel comfortable with the process.

[Hárbarðr]

Thank you for the prompt reply.

And I agree with you. Not planing on timing the market, that would be too much of a gamble and a waste of time.

As for investing in it self, since I am starting, I think I should focus on few equities rather than to diversify too much.
My idea, was to get a good ETF, and one good US company and one EU company to invest in. Something with a good track record/ dividend yield (long and steady consecutive annual dividend increases)

Does that make any sense?

[Kanto]

Thank you for the prompt reply.

And I agree with you. Not planing on timing the market, that would be too much of a gamble and a waste of time.

As for investing in it self, since I am starting, I think I should focus on few equities rather than to diversify too much.
My idea, was to get a good ETF, and one good US company and one EU company to invest in. Something with a good track record/ dividend yield (long and steady consecutive annual dividend increases)

Does that make any sense?

Direct investing in the EU is difficult in Japan.

For tax purposes and currency reasons for investing in Japanese domiciled funds is preferable.

Stick with low-cost diverse index-tracking funds.

This would invest in the whole global market: You can buy it in YEN amounts and hold it in most tax-advantaged accounts.

1. https://emaxis.jp/pdf/geppou/253425/253425_202012.pdf

Here is a similar mutual fund that skips Emerging markets and only focuses on developed countries.

2, https://emaxis.jp/pdf/geppou/252653/252653_202012.pdf

[Yossarian]

1) I think the best thing most people can do is to invest in the stock market as a whole. This is the easiest thing to do, and has a good chance of success over the long term.

I have a follow up question about this: When doing this how does one diversify? Or is a whole market investment already diverse?

My wife and I both max tsumitate NISA with emaxis all country fund. I'm going to start investing our left over cash each month too - should we continue with the whole country fund or do we need to diversify? For example one of the S & P 500 funds or developing fund? But I suppose their must be some overlap between them and the all country fund anyway.

I'm more interested in the lazy style of investing where I can set it up, put the money in each month, but not have to think about it too much.

[Kanto]

1) I think the best thing most people can do is to invest in the stock market as a whole. This is the easiest thing to do, and has a good chance of success over the long term.

I have a follow up question about this: When doing this how does one diversify? Or is a whole market investment already diverse?

My wife and I both max tsumitate NISA with emaxis all country fund. I'm going to start investing our left over cash each month too - should we continue with the whole country fund or do we need to diversify? For example one of the S & P 500 funds or developing fund? But I suppose their must be some overlap between them and the all country fund anyway.

I'm more interested in the lazy style of investing where I can set it up, put the money in each month, but not have to think about it too much.

Emaxis-Slim all country is as diverse as it gets for equities (stocks).

Diversification beyond that would be into Bonds (government), bonds (corporate), REITs, or Precious metals or commodities.

For the risk adverse government bonds are a great diversifier as they are inversely correlated with stocks. However currently due to historically low interest rates they are not returning much at present.

[Yossarian]

Emaxis-Slim all country is as diverse as it gets for equities (stocks).

Diversification beyond that would be into Bonds (government), bonds (corporate), REITs, or Precious metals or commodities.

For the risk adverse government bonds are a great diversifier as they are inversely correlated with stocks. However currently due to historically low interest rates they are not returning much at present.

Great - I'll keep putting it in the all country fund then. Thank you.