Strategy for the 2025 NISA

[sutebayashi]

However, you have got me thinking that a yen-hedged international bond fund might be a good play right now.

Not my intent at all but each to their own!

I thought I was the only currency speculator around here, but it seems that I’ve actually got good company

[northSaver]

You're essentially paying a few ¥100k insurance to guarantee you won't lose money or pay any tax.

A few ¥100k of opportunity cost in insurance, as you wouldn't actually pay anything and would be better off if the prices dropped.

I'm not sure if I'm being helpful or just confusing myself, so I'll stop now.

Thanks adamu for your thoughts. Always appreciated, they make me think. I think most people would suggest keeping money you need within the next four years as cash, but the fact you're buying a tax-free investment with it adds an interesting angle! Anyway, I'll stick to half cash / half funds and see what happens. Another advantage of the cash component I've just thought of is that it can double as an emergency fund until towards the end, because in an emergency you wouldn't need to add it to NISA.

I thought I was the only currency speculator around here, but it seems that I’ve actually got good company

Well, this would be more of a small corner of my portfolio than a currency trade, but yes, I agree there is some speculation involved! I've actually been trading currencies and other instruments on and off for a long time, way before I became interested in investing. I remember the days of phoning my orders to a broker (no online brokers back then) and buying German Mark futures!

[bryanc]

this is an interesting thread!
am having a similar dilemma in that im worried if the emaxis slim is now the best fund to be in for the next few yrs..
i have a lot in the s+p ,also the all country fund..

[northSaver]

this is an interesting thread!
am having a similar dilemma in that im worried if the emaxis slim is now the best fund to be in for the next few yrs..
i have a lot in the s+p ,also the all country fund..

If you probably won't need the money for at least the next ten years then I would say no problem - keep investing in the All Country. And if you're worried about a continual decline then DCA into it, once a month or quarter. If you're worried about a crash then keep some cash aside so you can lump sum in at a good price. Statistically a 10% drop from the last high is a good place to lump sum some cash (but not all), and a 20% drop is a very good place to lump sum some more. A 30% drop is the best place but very rare. Note that these figures apply to the US stock market and could be different for All Country due to currency movements. It's not an exact science! Good luck.

Edit: eMAXIS Slim All Country is about 6% down from the last high right now (Sun 2nd March).

[JimmyK]

Hi all
Wow! It’s been a rough couple of days on the markets. Things not looking too good so far, with pretty much all gains on the US markets since last December wiped out in the past few weeks. Dollar has weakened considerably too in the past 24hrs, all of which has had a direct impact on my NISA account (which is all emaxis slim all country right now). Overseas investments in similarly global focused funds (and 1 tech focused) have also taken a battering.

Anyone investing in the stock market must accept short term volatility, but this is especially gut wrenching. Sure, we could see this as a buying opportunity, but with little spare cash, that’s not an option for me at present. In any case, I might need that if job situation worsens. Anyone else feeling the heat? Coping strategies (besides waiting and hoping it’s a short term blip, rather than a long term correction)? Call me Mr. Gloomy if you wish!

[RetireJapan]

Hi all
Wow! It’s been a rough couple of days on the markets. Things not looking too good

This is nothing, and, as long as you don't need the money now you should be happy that your monthly purchases are now buying more stuff.

Automate everything and ignore the news.

In ten years time you won't remember any of it, unless you do something stupid like sell everything

[JimmyK]

Cheers. I’ve yet to set up the Tsumitate side. Only started NISA late last year and scrabbled to get lump sums in in December and earlier this year. Need to set up monthly contributions soon. So emaxis slim all country is still the way to go?

[northSaver]

Yes, tsumitate All Country is the way to go. And according to this chart it is still only about 6% down from the highs, which is absolutely nothing. The horizontal blue lines I've added are 10% and 20% down from the highs. The worst this type of yen-based fund has dropped in recent memory is about 60% during the GFC (2007-2009). That is the time to be worried!

[sutebayashi]

Cheers. I’ve yet to set up the Tsumitate side. Only started NISA late last year and scrabbled to get lump sums in in December and earlier this year. Need to set up monthly contributions soon. So emaxis slim all country is still the way to go?

That’s the beauty of putting money in tsumitate style - it’s boring and you don’t feel the market corrections.

I plan to lump sum in if there is something in excess of a 20% downturn, if I am quick enough… but defaulting to tsumitate means I’m on autopilot.

emaxis slim all country is all stocks, which is fine if you are putting the money away for 10+ years in the future, but not for everyone. It’s not for me. I don’t want to be so massively exposed to a few stocks like the MAG7, even if that’s what such and such an index says. (I have approx 40% in emaxis developed market stocks - a much lower exposure to the US for better or worse, 25% in the developing markets one, 12 and 8 in developed and developing market bond funds, and the rest in reits and gold and cash. I see I’m down 1.79% on the year including new money, so it looks pretty flat to me. This year might be a poor one though - the last two were really good so we’re possibly due.)

[beanhead]

Wow! It’s been a rough couple of days on the markets. Things not looking too good so far, with pretty much all gains on the US markets since last December wiped out in the past few weeks.

If this is long-term investing, looking at ups and downs from 2 or 3 months ago is basically pointless.
Ignore it if you can, and set up regular monthly purchases if you can.