Rate my portfolio (factor tilt + Eurozone bias)
I am 30 years old, living in Germany, and I recently started investing into the following ETF portfolio through Trading212:
AVWC: 57%
AVWS: 8%
AVEM: 9%
PRAZ: 26%
I plan on contributing monthly for a long time (till retirement). I employed a moderate factor tilt because I do appreciate the empirical data supporting factors and the theoretical justification behind them (especially small-cap value), but I am not convinced that their theoretical foundation is as strong as CAPM's, which is why I keep the tilts reasonably small.
Here is my reasoning behind the allocations:
AVWC+AVWS is developed world, and I keep its total contribution vs. AVEM match the respective market capitalizations. I set AVWS such that the total percentage of the small cap stocks in my portfolio (according to Morningstar) is about 16%, matching the Rational Reminder (RR) 2020 model portfolio.
In order to match the home bias of 30% (as in the RR portfolio, as well as according to the findings of this paper), I include PRAZ (Cederburg, one of the authors of the paper, said that he would consider the whole Eurozone as the home market for those living in it)
Any thoughts/perspectivees would be appreciated!
Posted May 28, 2026, 10:38 AM UTC