IVVB11 it’s a stock ETF from SP500 like IVV (ishares) that can be purchased by Brazilians in Brazil.
Good morning, today I’m going to talk a little bit about this fantastic investment tool called IVVB11 (according to the requests of the readers’ friends), which can be bought by any Brazilian with a brokerage account in Brazil.
Remembering that I am not an analyst and that this is not the recommendation of purchase, it is only an opinion of a common citizen and an asset review. I believe that Ivvb11 is a good asset to diversify the assets of anyone here and that in addition to being a direct investment in more than 500 companies listed on the NYSE, is also an inexpensive way to buy and keep part of your equity in dollars.
How to buy ivvb11?
It’s simple, open an account with a Brazilian securities broker, such as Clear, XP, Rico, etc … enter the home broker (the brokerage software page where you give a purchase order “order” the action you want, Enter ivvb11, enter the amount you want and the price you are willing to buy – I always look at the quote for the moment and put the same value as the last deal, no more, no less). If the order is executed, it means you bought it, and if you bought it will be yours until the day you decide to sell it.
Ivvb11 is managed by the powerful Black Rocks, the world’s largest global ETFs and fund manager, with more than $ 7 TRILLION in management, buying and selling stocks and funds worldwide, with ETFs from various countries and industries, bonds Governments and corporations, and global and national REITs (those that are similar to our real estate funds).
Black Rocks most often manage index ETFs, passive products that only follow the markets. I do not think that future has to buy ETFs in Brazil, but abroad the figure changes a thing. Brazil represents only 3% of the global economy, the United States represents 50%.
Choosing 30 companies and tracking to be a partner in Brazil is relatively easy, but in the US, the thing changes in figure, first because there are more than 10,000 companies listed and secondly why hardly pick stock (stock picking) will come out Winner there, outside the time it will consume in your life. The current management fee that Black Rocks charges are only 0.24% per annum on the value of the fund, that is, of every $ 10,000.00 you have in there, you will only pay 24 reais for Black Rocks to have this Work to buy and distribute the product, I think much more than fair and valid, is the price of half a pizza that you buy one night.
Let’s know a bit more about IVVB11, it represents the SP500 which is the main index of the American stock exchange and which lists just over 500 companies, so when I talk about IVVB11, it’s the same as SP500.
First axiom – THE MARKET ALWAYS GO UP.
Yes, it’s sunny, the market will always rise, and it’s not me who says that it’s history, with wars, without wars, with the crisis, without crisis, despite crises and scoundrel governments, the market will always rise. The stock market is the largest means of wealth creation that humanity has ever seen, exactly why the stock exchange represents companies, and whoever creates wealth is a company. The picture below is a classic from Jeremy Siegel’s book – Stocks to the long run, the top row is the SP500:
Stocks – in the top row are stocks, the return of the index.
Bonds – are government bonds, the same as the US Treasury.
Bills – are also government bonds of shorter maturity.
Gold is gold.
As we have seen, NADA outperforms the stock investment in a series of more than 200 years. Even after the crises, the stocks recover.
Below is another image, this time from the Dow Jones, which is another US index, the industrial index, older and more classic than the SP500.
See the mountain of money being formed, looks like the 1929 crisis notorious was cleared in 42 another crisis in 1971 another crisis in 2000 another crisis in 2008 another crisis … see that crises always fade with time. The crisis is good for selling newspapers and the media have what to say, for those who buy stocks is a good time to buy more stocks and accumulate MORE for a lower price. As I said, the market ALWAYS rises, considering the long term, there is no way not to rise, companies are always generating wealth, charging for their services and gaining ABOVE inflation.
As I said in another post, the return on equity in the US over the past 86 years, investing in the SP500 index was 6.6% ABOVE annualized inflation, slightly more than our venerated Treasury Direct IPCA +, in which the bastard government Correct the bonds for inflation and tell you that this was your profit and charge you for it.
Second axiom – Buying the SP500 you buy the world.
Did you know that more than 50% of US corporate profits are NOT generated in the US? That’s right, you heard right. More than half of the companies’ profits from the sp500 index are realized outside the US. See, these companies are GLOBAL, have revenues in HUNDREDS of COINS and sell their products and services across the globe. Do you want to see it? Let’s take a look at the top 25 companies in the index, in the first column after the company name we see the WEIGHT of each company in the index, in the penultimate we see how much it yielded from the beginning of 2016 until now, and in the last we have the P / E Which is our famous P / L.
Note that these companies have revenue worldwide. Apple? Sells iphone and MacBook pro worldwide, Microsoft too, Coca-Cola? You do not even need to talk. Google? Everybody comes in all day. Facebook? More than 1.3 billion users. Johnson and Johnson? idem. Pfizer (that of viagra) always developing new drugs. Intel and Cisco system are the cream of the processors that go into several computers and servers.
Anyway just so you have an idea. You can join these companies with just a few clicks on your broker’s home broker. Over there are the charts of what happens to the index over the decades. The index will not FAIL, no one will hit the index, any bad action from any company (breaking or theft) will not impact as much on the index. Buying the index is buying diversification, is buying peace and buying a product of value (as I see it).
Third axiom – It is useless to try to “hit” the American market.
As I said, you can try to make a stock pick in the US, study, lose time, worry, read lots of balance and go at the most, after a lot of loss and hours away from the coolest things to do Surfing, sleeping, training, staying with family, dating, watching movies and TV shows, going to the beach, traveling), having a mediocre result to the index, EXCEPT, if you’re a Peter Lynch, a Warren Buffet of life, .
The source is this article from the excellent website Market Watch (which has here in the links of my blog)
And here I am talking about professional managers.
Guys who studied economics and finance at the best colleges and universities in the United States, guys who spend all day analyzing business reports, meeting, visiting companies, talking to business boards, insider trading on new products and services, etc. .. etc … The profession of the fund manager is increasingly threatened, and this is good for us small global investors.
Highlights of the study:
“The results are even more shocking. As the article says:
“Bars, Scaillet and Wermers tracked 2,076 Actively managed US domestic equity mutual funds between 1976 and 2006.
“And – are you sitting down? Only 0.6% – you read that right, 0.6% – showed any true skill at beating the market consistently, ‘statistically indistinguishable from zero,’ the three researchers concluded. ”
That is, by evaluating 2076 active funds (which the manager buys and sells shares actively) between 1976 and 2006, only 0.6% hit the market consistently. That is, you want to do this, will have to be very good, lose a LOT of time and count on luck to make a legal license and at least about 60 companies from NYSE to start getting a relatively quiet diversification.
Now let’s face it, no one has the mission or the obligation to beat the index. You can and do have the right to choose individual stocks and buy (for this you will have to open a brokerage abroad, send money, pay shipping fees – look at the cost) to TRY to challenge the entire global market. Yes, we know that there is a lot of bad company in the index after all the index is the index, it is a passive thing, so lots of junk goes in too. Not everything in life is flowers. There had to be some downside.
Another thing, how much does your time cost? You see, imagine that you will spend the next 45 years of your life buying stocks. Imagine the future time this will cost you watching news, worrying about this or that company from your wallet, reading report, surfing the internet, having to sell some, leaving at the loss, buying others, hours and hours and hours and more hours Lost her life to make a decent stock picking off, for almost nothing. Being able to be a little more modest, buy the passive index and simply forget that you have to worry about it all. Your relationship with your family may even be healthier if it is so.
And I say this very calmly, since I already have 26 Brazilian shares and I already feel a certain difficulty in following all of them, and also added another 20 real estate funds to my portfolio, so there are already 46 assets to follow, I see discussions here and there about A tenant of such a fund that is going to come out, that such a fund will pay 10 cents less than income from in a year etc etc … personal, will it be worth all this of wasted time to earn more cents?
Each one who does a self-assessment about his particular case, I will not waste my life analyzing real estate funds and stocks every month to define which to take and which to place, which to sell, which to stop buying, which to give a time, which has worsened, Which will improve in 5 months …
Now let’s go back a bit to ivvb11, or the SP500, let’s see a little of the return of this and what it’s done financially. The chosen asset is the VOO (the cheapest ETF to accompany the SP500, distributed by Vanguard) at a rate of only 0.05% per year.
Look there in the third line of the price of the SP500 that it only fell in 2008, a year that had a bad crisis. It fell -35% (it looks good time to BUY), then in 2009 roses 26.46%, in 2010 rose another 15%, in 2001 rose 2.11%, in 2012 rose 16%, in 2013 rose 32.39% , In 2014 rose 13.69, in 2015 rose by 1.38 and this year already rose 5.87%. That is, the first axiom that said, The SOAR MARKET ALWAYS and rises ABOVE INFLATION IS TOTALLY COHERENT.
Here below we see the types of companies that make up the index, half of the companies are giant, and BOTA giant in this, a single company of these is larger than the whole Brazilian bovespa, 36% are large companies (which are equally gigantic) and less than 1 % Are small (did not want to know the size of a small American).
The current valuation is below, many would say that at the moment the US stock market is expensive, yes okay, it is, but as I said THE MARKET ALWAYS GO UP, so if you buy now or in 3 years will not make so much difference in Long-term because the market will rise with or without you. And even more buying it does not make a difference, can you believe, does it make a difference if you buy today at 75 or 80 dollars if in 3 years it will be at $ 100 for everyone? Think carefully.
In the US, the VOO pays dividends, at just 2.29% per year. Buying ivvb11 here in Brazil you do not receive the dividends, they will be reinvested automatically to buy more shares of the fund, so it does not change anything in your equity, it is even better that you do not worry and will not need to pay another order in the Your broker to buy more ivvb11.
Let’s see how the IVVB11 left Brazil in those times:
From April 30, 2014, until November 3, 2016, the IVVB11 rose + 65.96%.
Understand one thing, you’re also investing in dollars.
You know the news like this:
“Today the dollar skyrocketed and reached its historical maximum at 8 reais?”
So if you’re invested in IVVB11 you’ll laugh out loud, the $ will no longer be a problem for you. If you continue to invest only in REAIS, this news is HORSE, because you have impoverished in dollars, it is difficult to travel, take vacations abroad or emigrate. The more IVVB11 you have, the less the $ R $ will be trouble because when the dollar rises, the IVVB11 rises like a rocket.
So if in 15 years the Brazilian government gives one of Venezuela and devalue our fragile currency as if there were no tomorrow, its capital will be protected in dollars. Plus this beautiful PLUS for you, for your peace and for your family. And investing is this, it is to protect your money, your assets, your peace, your work and your future. Forget this profitability thing a little and think outside the box a little, investing is not just winning, winning and winning.
Now let’s look a little bit by sector of the SP500:
19% in technology and 14% in health and also in financial, the three largest. Then 11% in cyclical consumption, 10% in industrial and almost 10% in defensive consumption. Only then was almost everything, the rest in real estate, basic materials, communication, and utilities (water, energy, telephone. As you can see, diversification.
Buying the index is an exercise in humility, neither better nor worse than anyone, just follow the tide. It is an exercise in diversification, strong currency protection that is the dollar, society with brands and global companies (more than 500 in one click only), protection against their own ignorance and insignificance (in terms of volume of money) and inability to select Winning companies in the long run. It also has protection against Brazil’s junk policy and protection against the melting of our own currency (mitigation of foreign exchange risk).
You will find various studies on the internet showing the best performance of investing in LIABILITIES index funds than in active funds managed by managers in any series at any time such as:
What I did here was just to show an asset and the advantages of investing in it.
I would say that putting at least 50% of your stock portfolio by investing in the SP500 is a sensible, mature and prudent attitude. That’s 99.99% of people in Brazil or the world. This is a very personal choice and each one has to see their own reality and person history. Investing is a very peculiar and very personal science of each individual, as well as the allocation in stocks, income gets and other funds and even real estate. This little post was just for a better clarification.
The name is IVVB11 in Brazil, in the USA the name of the same fund distributed by the same Black Rocks is called IVV. If you want to know more about the IVVB11 visit his own page on his official site on the Black Rocks page:
Big hug to everyone,