Justetf lists one accumulating version, UBS MSCI EMU Value UCITS ETF EUR acc. On Nordnet with the ticker AW1T.
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Well, what on earth now.
Whenever you think youâve figured something out, itâs still worth asking others, and it apparently paid off this time as well. I might have found that before, but I might have been tripped up by the Luxembourg thingâbut that doesnât matter tax-wise within the eurozone, does it?
Thanks. Unless thereâs something Iâm not getting? It could be a bit cheaper, of course.
Thereâs nothing inherently wrong with that, I suppose. IMO, a plain value filter is a bit âmehâ when there are better multi-factor products available, such as ZPRX or the upcoming Avantis ETF.
Gemini gave a pretty solid explanation of the benefits of multi-factors
Here is an analytical look at why a multi-factor approach is usually a more sensible choice than focusing solely on Value:
1. Diversification between factors (Synergy benefit)
Factors such as Value, Momentum, and Quality perform differently in various market conditions. Value stocks can underperform for years on end (as we saw in the 2010s), but at the same time, Quality or Momentum factors can carry the portfolio.
- Multi-factor benefit: When you combine multiple factors, the portfolioâs return curve smoothens. According to research, there is often a low or even negative correlation between factors, meaning they âoffsetâ or complement each other.
- Single factor risk: An investor relying solely on value takes on a massive âstyle risk.â If the market favors growth companies for the next five years, the value portfolio will lag behind, testing the investorâs nerves (so-called tracking error regret).
2. âValue Trapâ and the importance of profitability
The biggest risk in pure value investing is the Value Trap. A company may be cheap because its business is dying, and it will never return to its former glory.
- Avantisâs solution: Avantis doesnât just look at a cheap price; it combines it with profitability.
- Why does this work? Fama & French (2015) showed in their five-factor model that profitability is a critical factor. By investing in companies that are both cheap and efficient at making money, you filter out the âjunk companiesâ that a purely price-based screening might stumble upon.
3. Trading and tax efficiency
If you were to build a multi-factor portfolio yourself by buying five different single-factor ETFs, you would face significant efficiency issues:
- Overlapping trading: A Value ETF might sell a stock just as it starts to rise (because it becomes more expensive), while a Momentum ETF would want to buy it at that exact moment. If both are in the same package, like an Avantis fund, redundant trading is avoided.
- Internal netting: Factor rebalancing occurring within the fund saves on trading costs and tax consequences compared to a portfolio manager having to sell and buy stocks across several different funds.
4. Practical example: Avantis Global Equity UCITS
Avantisâs approach is systematically active. It doesnât follow a rigid index that only updates twice a year; instead, portfolio managers can react daily to changes in companiesâ valuation levels and profitability.
| Feature | Plain Value ETF | Avantis Global Equity (Multifactor) |
|---|---|---|
| Main focused factor | Cheap price (P/B, P/E) | Price + Profitability + Size |
| Portfolio character | Highly cyclical | More balanced pursuit of outperformance |
| Risk management | Focuses on one style | Diversifies across multiple risk premiums |
| Expected return | High, but inconsistent | High and better risk-adjusted return |
Summary
A multi-factor product like Avantis is preferable because it offers better protection against âlean yearsâ by diversifying across different investment styles, while using more advanced screening (profitability) to avoid low-quality cheap companies. It is scientifically more grounded and psychologically easier for an investor to hold in a portfolio for the long term.
And youâre not wrong about that rather concentrated sector breakdown, either.
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What makes ZPRX a multi-factor? SC and value, or? Even Geminiâs response doesnât support this? Besides, the SC quota is indeed starting to be full.
I donât remember the methodology off the top of my head, but here are the regression analysis results.
AW1T can expect something like this.
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The main point was home bias, however, plus value, which will surely result in some tilt as well.
Do forum members have any recommendations for US SaaS ETFs? It would probably be easier to get in through one of those at some point instead of guessing who will win the AI race or what will be disrupted.
Can you do these kinds of analyses yourself, or where is this from? Does that result have any actual substance?
Interesting that value doesnât stand out more than that, if Iâm reading this correctly.
In principle, I could take even more SCV, but I donât have time to wait 20 years, and SC itself is otherwise at about market weight, which Iâve mostly tried to maintain âanywayâ.
This is from the Rational Reminder forum, from a portfolio manager named Brent Van den Broeck. You can find for US ETFs online, but I donât know if there is a tool with good and comprehensive data for UCITS ETFs.
Of course, itâs possible even with Python, if you have the diligence. It requires the ETFâs closing price data for as long a period as possible, and factor and interest rate data from the French Data Library.
In practice, all interesting factor ETFs are scrutinized on the RR forum, and the results can be found there, done by professionals.
Regression analysis thus tells which factors together explain the ETFâs historical returns. So, in that sense, it is based on fact. Factors have historically generated outperformance, but there has been some fading, and naturally, no one knows for sure if outperformance can be achieved with them in the future. Quiz an AI on the subject or check out Ben Felixâs YouTube channel to get a better understanding of the topic.
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I intend to focus more and more on broad ETFs for all my investments. But what should I buy for an equity savings account (OST)? The account is so far in profit that I donât want to withdraw money from it. Until now, Iâve put the proceeds from sales in the OST into Investor AB shares, but the allocation is starting to get unnecessarily large. My question is: any good stock ideas for âholding companiesâ with at least some level of diversification, that own ETFs, etc.? Letâs stick to the Nordics and Germany. On the book-entry account (AOT), the rest of the world is covered via ETFs.
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Actual investment advice is prohibited, so you wonât really find âbuy stock Xâ style advice here. You can certainly ask for ideas, and the foreign serial acquirers thread at least could provide some potential ideas.
One that also comes to mind is Scottish Mortgage Trust. Its portfolio includes, among others, SpaceX, TSMC, MercadoLibre, Amazon, Meta, Spotify, etc. Considering an equity savings account, it is UK-listed, meaning dividends are received without withholding tax. I emphasize that this is not a recommendation; I do not own it myself, and this is just an idea for further investigation.
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Ok. Iâm familiar with Ben as such, but not so deeply with factors. Home bias doesnât really relate to factors. Itâs a pity I canât find that piece where it was explained so well.
Is this what you are referring to?
You can get home bias at a low cost with PRAZ. There was even a comprehensive comparison of this in the RR, where PRAZ performed the best, so itâs not just cheap on paper. Of course, you can get it even cheaper with the Nordnet Finland index, but Finland is such a small market that I would keep the bias a bit smaller.
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Similar types of stocks include at least Latour and IndustrivĂ€rden. I donât know, nor am I saying whether theyâre worth buying. At least there is a bit of extra tax on dividends to Sweden. I personally hold the latter and was considering the former on Friday.
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Is there more information on this somewhere? Blackrockâs website still lists the fees as 0.05%.
I wonder what the most cost-effective choice for a Europe fund would be? Iâm considering these, but Iâm puzzled by how Storebrand has racked up a 280% return for the max period, while Handels is at 161%.
These funds werenât started on the same day, after all 
Out of Nordnetâs selection, at least, I would choose Storebrand. Itâs the most diversified and appears to be the cheapest in terms of costs based on the KIID.
As an added bonus, these Storebrand index funds are actually ânear-indexâ funds, so with any luck, they might also manage to avoid the hidden costs associated with index funds.
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Hello fellow investors! Iâve been investing in index funds for nearly 3 years now and Iâm reflecting a bit on my index investing at the moment.
Currently, my portfolio contains the following funds where âŹ500 goes automatically every monthâmeaning âŹ100 into each fund:
- Nordnet Finland
- Nordnet World
- Nordnet Technology
- Nordnet Europe
- Handelsbanken USA
Iâm currently thinking about the weighting of my portfolio and would be interested in finding another good ETF/index fund to add, or what do you think about the diversification?
Iâve been considering, for example, Nordnetâs emerging markets fundâdoes that make any sense, or would some ETF be better?
Thanks in advance for all the tips!
Here is a sensible comment from @Paapaa from a year ago â I wonât even try to come up with anything better.
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Itâs a bit difficult to find information on the fund in question, so Iâll ask directly in response to the post. Is it the case that Storebrand invests in the ânormalâ MSCI index, but excludes the âbad-guyâ companies? And they donât admit to being an index fund âbut track the index,â so they donât have to pay costs to the index provider. This is the impression I got from a quick search. I couldnât find a tracking index anywhere.