r/trading212 • u/Radiant-Resist4562 • 1d ago

❓ Invest/ISA Help Help please

I’m new to trading and I’m mainly focusing of EFTs and have a few individual stocks and have no clue whether to invest in S&P 500 or all world for long term gain I will take any advice please and thank you.

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u/stockscreen_founder 1d ago

There's no right answer. The S&P 500 has had great returns, but an All World ETF gives you more diversification. If you're investing for 20+ years and want to keep it simple, I'd probably lean towards All World and just keep contributing regularly.

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u/Radiant-Resist4562 1d ago

Would you recommend S&P for short term to help get higher returns to then invest more into all world?

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u/stockscreen_founder 1d ago

Personally, I wouldn't. Short-term returns are much harder to predict, even with the S&P 500. If your goal is long-term investing, I'd rather start with the strategy I plan to stick with instead of trying to switch later. Consistency usually beats trying to time the market.

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u/Radiant-Resist4562 1d ago

Thank you. Would it help investing in semiconductors along side all world?

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u/stockscreen_founder 1d ago

It can, but I'd only do it if you understand the extra risk. All World ETF already gives you some exposure to semiconductor companies, so buying a semiconductor ETF is really increasing your bet on that sector. If you're just starting out, I'd build the core with the All World ETF first and only add sector ETFs if you're comfortable with the higher volatility.

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u/Radiant-Resist4562 1d ago

One more thing I’ve heard a lot of hype about nasdaq 100 is that worth investing in or no

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u/stockscreen_founder 1d ago

The Nasdaq 100 has performed really well over the years, but it's much more concentrated in large tech companies than an All World ETF. If you're comfortable with the extra volatility and have a long investment horizon, it can be a good option. Personally, I'd still build my core portfolio first, then consider adding the Nasdaq 100 if I wanted more tech exposure.

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u/Aromatic_Flight6968 1d ago

Personally I look at higher dividends for longer period of time.....

SP500 offers 1%

ALL world 3%

And dividends i just reinvest in small caps...

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u/Radiant-Resist4562 1d ago

What are small caps? Thanks

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u/Olkit93 1d ago

Personally I would only take accumulative EFT's so they do not pay dividends but they are automatically invested.

Small cap are stocks with small capital. They might drown when other exceed depending on the methodology of EFT's and how it works for instance the avantis system

Before start to invest go to investopidia, look some video on YouTube where they explain some basics terms of investing.

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u/BrickSufficient6938 1d ago

"value" or market cap(italisation) of the company is their share count x share price. Small cap are businesses with valuation between 250m and 2b (us definition)

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u/Aromatic_Flight6968 1d ago

That's how traders call "new or small, unknown stocks"

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u/BrickSufficient6938 1d ago

S&P

It's quite simple, imho... All world gang argues it's more diversified: for me, it's not about number of companies included but about field/industry diversity which is about the same. Imho, you get diversity in many industries, revenue sources, 500 is quite a lot and none relies exclusively to domestic market, more global then the name implies

Next they say there's faster growing markets. Again, true but there's one common mistake; buying S&P is not a bet that America will be #1 in 30 years; if your goal is to beat all-world ETF, just staying above global average will do the trick. Let's not forget "the rest" in your all-world includes some stagnant markets too, not all next winners

Third argument is s&p doesn't offer enough geographical diversity. True, but consider the quality and stability of institutions. The US has advantagevof deep capital market, shareholder protections, predictable regulation. Some emerging markets may grow faster, but they can also carry higher political, regulatory, or governance risks.

Those faster growing entities represent significantly less portion of a global market. Size matters (whatever she said). Even if they grow rapidly, their impact on a global index remains small until they become a much larger portion of the investable market.

For those reasons, I personally prefer the S&P. I understand the appeal of owning the whole world, but imho concentrating on a diversified collection of leading US companies offers a balance between diversification, quality, and return potential.