Nathaniel Gration isn’t one to be tempted by passing trends. “One of the biggest challenges that I think every investor faces is the emotional pull to do this or that,” says the eToro Popular Investor from Australia. “The way I combat that is to look at the facts rather than my feelings, as well as stick to my long term strategy.”
“That being said,” Gration continues, “your strategy should have some wiggle room to make adjustments along the way if need be.”
One of the adjustments Gration has made recently is investing in artificial intelligence (AI) by way of innovative yet well-established tech industry players. “Investing in Nvidia and Microsoft is an AI play for my portfolio. There is enough push towards AI that it looks like this industry will be with us and not fade out,” he predicts. “When you look at Microsoft’s suite of products, such as Word, Excel, Outlook and more, you can see how intuitive it would be to plug a good AI system into them.”
Another tech trend Gration believes has staying power is electric vehicles (EV), and he is invested in General Motors specifically. “I like where GM is going with their vehicles in the electric sector,” he says. “I believe they will be a good performer over time and a bit of a surprise story in that industry.”
A carefully composed strategy
These are good examples of trends which fit well into Gration’s long-term investment strategy, thoughtfully devised with his family’s financial goals in mind. “We are investing for two reasons. The first is our retirement and the second is for our kids’ college or future endeavours.”
Gration has carefully composed his portfolio in order to protect his investments for the long term, while still benefiting from some higher risk/higher gain assets. “There is exposure to all risk levels, but I minimise the percentage of higher-risk assets in the overall portfolio,” he explains.
Like many smart investors, diversification factors heavily into Gration’s risk management strategy. This includes investing in a variety of global assets. “I mostly invest in the US market, but have exposure, to some level, to all sectors and markets,” he says.
“As far as the international market goes, I currently hold VEU which is Vanguard’s international ETF. I am also looking at being a bit more specific in my selection of international markets, by putting funds in the AUS200 (Australia’s top 200 companies), the UK100 (the UK’s top 100 companies) and the GER40 (Germany’s top 40 companies).”
Breaking it down
How does a well-diversified, long-term investment strategy translate into a portfolio? While this may vary and be different for each investor, Gration’s portfolio is structured so that the largest positions are in assets with the least risk, and higher risk assets are held in much smaller positions:
- Markets: ~65% to 70% allocation. Includes assets with exposure across multiple sectors and industries, such as the Vanguard Total Stock Market Index Fund ETF (VTI), which tracks the entire US market.
- Income-producing assets: ~15% to 20% allocation. Includes assets paying strong dividends, oftentimes monthly, which allows for consistent reinvestment. Examples are assets like the Global X NASDAQ 100 Covered Call ETF (QYLD), the Invesco S&P 500 High Div Low Volatility ETF (SPHD), and the Schwab US Dividend Equity ETF (SCHD).
- Sector-specific assets: ~15% allocation. Includes assets that are specific to an industry sector, such as the Invesco Solar ETF (TAN) composed of solar energy sector holdings, or the Vanguard Financials Index Fund ETF (VFH) which focuses on the financial sector.
- Single stocks and crypto: ~5% allocation. Includes cryptocurrencies such as Bitcoin and some higher-risk assets stocks such as Rivian and SoFi.
Expect the unexpected
How does Gration handle market volatility and other challenges? He is optimistic while remaining practical. “You can’t be afraid of seeing red in the market and your portfolio,” he says. “As long as your strategy is well planned and diversified, you will have steady gains over time.”
Gration’s own strategy allows flexibility and takes volatility into account. “For example, SPHD in the income-producing category performs well in volatile times. VTI will also help keep things stable. So in volatile times we will move more funds into holdings like these,” he explains. “I also keep a strong focus on the facts of history, which show us that everything will be ok.”
Facing challenges with positivity
Growing up, Gration was diagnosed with Stargardt’s Disease, an uncorrectable eye condition which leaves him with only about 10 to 15 percent of his vision. Even so, he has admirably overcome limitations with ingenuity, positivity and a sense of humour that comes through in his attitude towards life as well as investing.
“I use audio to listen to my emails. I have done a lot of personal study via audio books, as my impaired vision doesn’t allow me to read. I received my Bachelors of Science in Organisational Leadership, I am a certified personal trainer, and I am currently studying for my certifications in investment and wealth management with CISI (The Chartered Institute for Securities and Investments).” Gration is even a pastor at his local church in Alice Springs, Australia.
Nate’s tips for investing beginners
- Trade without leverage. “There are quite a few rules that I have when it comes to my investments, but one of the big ones is no leverage of any kind.”
- Use real money. “Virtual is great… but you learn lessons pretty quickly with real money. This has brought me to my current portfolio structure and strategy.”
- Invest consistently. “The biggest piece of advice I give to people who want to start investing is to set themselves up to be able to deposit and invest consistently.”
- Invest what you can afford. “Try to minimise debt, such as loans and credit cards; get those payments out of the way. Then set up an emergency fund; only after which, start investing. This means when an emergency happens – and they do happen – you don’t have to close positions in your investments.”
Making investing simpler
Gration has been active on the eToro platform since 2020, working his way up to Champion level Popular Investor status and leading others in our social investing community. “One of the big things that attracted me to the financial space was the desire to try and simplify it,” says Gration. “In my posts on eToro, I try to keep things simple, so that everyone can understand them. I enjoy teaching and empowering others to take the same steps – I do the same as a pastor and as a personal trainer.”
“eToro is an awesome platform to invest on,” he adds. “It combines two of my passions – finance and helping each other simplify and make sense of things.”
“Money is something that so many people tend to shy away from discussing, but on eToro everyone is comfortable talking about it. Everyone wants the best for each other.”
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