Raindrops on roses... (a few of my favourite ETFs)

Raindrops on roses and whiskers on kittens 

Bright copper kettles and warm woolen mittens

Brown paper packages tied up with strings

These are a few of my favorite things [ETFs]

I do use a small part of my investment portfolio to buy individual company stocks like NVidia or Amazon or Tower Resources (!), but as I am no expert in company analysis, I tend to only break even with these at the best of times!

Index ETFs on the other hand will never go down to zero and usually tend to go up or at least keep pace with inflation.

The only exception is if I buy a very risky stock. In this case, I will buy it inside my GIA account so that if I make a loss, I can deduct that loss from my total gains and thus pay less CGT. If it makes a large gain, then I don't mind paying the CGT! On the other hand, if I held it inside my ISA and I lost 90% of it, I cannot even make use of that loss. Trading outside of an ISA does have sometimes have an advantage...

The ETFs I have listed below are my favourites.

My ratio of holdings in these however will vary depending on the current stock market climate.

My favourite ETFs ordered by fund size

I tend to not sell ETFs such as SWDA, XDEQ, XLKQ, HMWS, CSP1 and EQQQ, and so I hold these in my SIPP and GIA accounts and don't sell them so as not to incur capital gains tax.

The other ETFs in the list are factor ETFs which I may sell or buy according to the current market conditions and I try to hold these inside my ISA so that I do not incur Capital Gains tax if and when I Sell them to buy something else.

You will see that over the last year, surprisingly, IUCD\ICDU tops the list at 40% (above Tech, the NASDAQ and Gold). IUCD currently has a large holding in Amazon (31%) and Tesla(18%).

IUCD (aka ICDU for GBP version)

Consumer S&P 500 top holdings (Amazon and Tesla, etc.)...

IUCD - Consumer Discretionary top holdings

IITU Tech S&P

Apple, NVidia and Microsoft...

IITU Top ten holdings

IUCM

Then we have IUCM (Google 31%, Meta 17%, Netflix 14%)...

IUCM - Communications top holdings

IUFS (USD)/UIFS (GBP) Financials is always a steady ETF too..

IUFS top holdings

S&P 500 and the Magnificent 7

We can see how much of the S&P 500 is now taken up by just the 7 top companies:

My favourite ETFs for today

Let's order them for gains in the last 3 months...

I tend to vary my holdings of IITU, IUCM, IUFS and IUCD...

• £ICDU/$IUCD mainly Amazon and Tesla
• $IUCM mainly Google, Meta and Netflix
• £IITU mainly Apple, NVidia and Microsoft
• £UIFS/$IUFS Finance
• £IUSU Utilities Energy, etc. 

If I think the UK Pound will keep falling, then I buy the $ version of the ETF. Currently, I am buying the $ version!

These are satellite positions for me. Rather than buy Amazon, I buy IUCD. Rather than buy Meta, I buy IUCM, etc. etc. These ETFs provide a less thrilling ride but I should still come out on top.

I fully realise that I also hold these companies in my global and USA ETFs and so I am increasing my USA weighting even more.

The recent DeepSeek panic has affected NVidia and so IITU suffered yesterday, so I bought some more while it was nice and low.

I try to take full advantages of UK tax allowances. This year (2024/25) we have allowances of:

• Personal Savings allowance £1000 (= £20k at 5%)
• Dividend allowance £500 (= £20k at 5% or 40k at 2.5%)
• Capital Gains allowance £3000 (= £15k at 20%)

So I keep an eye on my savings interest, paid dividends and capital gains for the current tax year in an attempt to maximise these quotas (after all, its free money!). Since we have a generous (not!) £500 dividend allowance, I use EQQQ to give me some dividends and all the rest of my ETFs are accumulating versions which don't pay out a dividend.

The above is not financial advice and you must please do your own research!