Fifth Avenue Forum

Outside of the 2011 dip in the US market, we never got much action in another version of this thread.
(Possibly because no one gives a **** and this will suffer a similar fate. )
But I figured I'd give it another shot...

I'll admit to having a spotty record, in terms of being a disciplined investor. Not from performance chasing, but because of not being able to make up my mind. In the interest of simplifying things and hoping to lessen the chance of me screwing up, I decided to simply my investments across tax deferred and taxable accounts. I now only own two funds:

Vanguard Total World Stock Fund
This tracks the global stock market and goes where it goes. Currently 52%/48% US/world.
US stocks have seen a mammoth run up, including against the rest of the world. This seemed like a decent time to pull the the trigger (given the relatively low price of international equities) and put my chips in for a global portfolio.

Vanguard Total Bond Fund
70% US government/30% corporates
Steady as a rock in turbulent times. You could do far worse for your fixed income.

My target is to end up at a 50/50 stock/bond ratio, when I retire. My crystal ball is cloudy, so who the hell knows what the right decision will be.

What are you yinz doing and why?

5dimes.eu


it hasn't been working out...

Colombia, are you doing the total stock market etf or mutual fund?

this gentleman has most of his taxable fund (aka the house down payment/child/marriage/other life changing event that isn't coming around fund) in the VTI etf. Kenny the kangaroo is getting the impression that the world part is dragging down the US portion.

From the nobody knows nothing department....

Swedroe: ‘Sure Things’ That Didn’t Pan Out
http://www.etf.com/sections/index-inves ... nopaging=1

what can i get for the 88 cents i currently have to my name

^ penny stocks.

If you put your money in a Roth 401k or Roth IRA the money goes in after taxes. You have to keep it in the R. IRA for five years (I think, unless they changed it,) before taking it out. There is no limit to when you can take the money out after that (ie you don't have to wait until you are 70.5). There are no penalties. The money grows tax free and you take the money out tax free. You can invest in both stocks and bonds, ETFs, etc, depending on the provider.

Also, not all stocks and bonds are taxable such as municipal bonds.

The catch is that you can not make above a certain income. So it depends on the person's financial circumstamces.

MSNBC has a game where they give you x amount of money (don't remember what it is) and you can invest on the NYSE as well as Forex. Whoever has the most after a couple of weeks (I want to say it's 3 to 4 weeks) wins!
Prize is 1mm before taxes.

Pretty penny for retirement building money!!! I think so at least.

Colombia, are you doing the total stock market etf or mutual fund?

this gentleman has most of his taxable fund (aka the house down payment/child/marriage/other life changing event that isn't coming around fund) in the VTI etf. Kenny the kangaroo is getting the impression that the world part is dragging down the US portion.

Just my $0.02: The fees for Vanguard index mutual funds and Vanguard index ETFs are next to nothing, so I'd always go with ETF. It takes one day advance to either buy or sell the mutual fund, but you can transact in real time with ETFs. VAst majority of time it would not make a difference, but I'd be quite angry if I traded on a big upswing/downswing that nobody could predict one day ago.

Vanguard ETFs are also liquid enough, so any concerns about illiquidity (i.e. that you would not bet the full asset value behind the share) do not apply here much, IMO.

Last, you don't invest in the "world part" to get return, but to get diversification benefits. Basically, for a small drop in expected return you get even better drop in volatility. I can't believe I remembered "columbia"'s post from 2013, but I indeed did:

http://www.letsgopens.com/scripts/phpBB ... e#p2592294

I think whether you buy ETFs or mutual funds etc one of the main factors in building and maintaining a portfolio is time horizon, balance and taxes.

What's the point of making gains when you give up a percentage to taxes?
At this rate, if you wanted you could buy life insurance, stuff the policy with money and use it as your own bank account. Infinite Banking.

Everything is after tax dollars and retirement ready. All types of investments including ETFs and Mutual funds, REITS, bonds, stocks, are available to you. You pay a built in fee for investing but anywhere you go the fee is built in.

"Last, you don't invest in the "world part" to get return, but to get diversification benefits."

That's too broad of a generalization.

I ran some back test numbers through:
https://www.portfoliovisualizer.com

Initial $10,000 investment growth for 1972-2014

100% US: $702,919
100% International: $620,691
50% US/50% International (rebalanced annually): $741,745




What does that mean for the future? Well, nothing really.
Does that tell me that there is a *potential* benefit of investing globally vs just the US? Yes, it does, and I accept that I'm unable to guess whether Team USA will outperform the rest of the world.

Not that it was possible to invest in an Emerging Markets index fund in 1972 (or even a pure S&P 500 index fund until 1976), but that's a lot of cheddar...and volatility.



Most of the growth in the coming 20 years is expected to be in developing markets, but - like all predictions - that's only worth something if it actually happens. I imagine that there are *some* people out there, who are daring enough to only ride that horse. Not me.

I ran some back test numbers through:
https://www.portfoliovisualizer.com

Initial $10,000 investment growth for 1972-2014

100% US: $702,919
100% International: $620,691
50% US/50% International (rebalanced annually): $741,745




What does that mean for the future? Well, nothing really.
Does that tell me that there is a *potential* benefit of investing globally vs just the US? Yes, it does, and I accept that I'm unable to guess whether Team USA will outperform the rest of the world.

When in doubt, Diversify!
The future is always doubtful.

Also, in general markets go up just because of the nature of markets. It doesn't really mean anything except that if you invest you'll probably be successful in the long run.

Is this fall the 7 year drop year?

1980, 1987, 1994, 2001, 2008, 2015

Back to the bubble talk for a moment....Jeremy Siegel thinks that the anticipation of Fed rate hike is actually keeping equity prices down.

http://www.cnbc.com/id/102725157

http://www.bloomberg.com/news/articles/ ... n-a-bubble

They're both smart guys, but I can't get too worked about who is more right/wrong. Who the **** knows...they certainly don't.

Exactly.

I have a dual retirement set-up, one is a "legacy" type through my employer which I do not expect to exist in 35 years when I retire and the other one is a multi-faceted term-life/401K/thingy I have through Prudential which is doing well.

But my real retirement plan is that I have a 25% chance one of my four kids will make it financially and they'll build me a shack out back with wifi.

I have a dual retirement set-up, one is a "legacy" type through my employer which I do not expect to exist in 35 years when I retire and the other one is a multi-faceted term-life/401K/thingy I have through Prudential which is doing well.

But my real retirement plan is that I have a 25% chance one of my four kids will make it financially and they'll build me a shack out back with wifi.

Why term? Does it expire when you retire?

I have a dual retirement set-up, one is a "legacy" type through my employer which I do not expect to exist in 35 years when I retire and the other one is a multi-faceted term-life/401K/thingy I have through Prudential which is doing well.

But my real retirement plan is that I have a 25% chance one of my four kids will make it financially and they'll build me a shack out back with wifi.

Why term? Does it expire when you retire?

It is not a traditional "term" policy it is a hybrid between term and life policy.

I have a dual retirement set-up, one is a "legacy" type through my employer which I do not expect to exist in 35 years when I retire

You can't move your money out of it to an IRA?

But my real retirement plan is that I have a 25% chance one of my four kids will make it financially and they'll build me a shack out back with wifi.

Enough to stream dem Buccos games.

I have a dual retirement set-up, one is a "legacy" type through my employer which I do not expect to exist in 35 years when I retire

You can't move your money out of it to an IRA?

We'll see. Hopefully I am wrong when that day comes.

But my real retirement plan is that I have a 25% chance one of my four kids will make it financially and they'll build me a shack out back with wifi.

Enough to stream dem Buccos games.

It is all I need.

I have a dual retirement set-up, one is a "legacy" type through my employer which I do not expect to exist in 35 years when I retire and the other one is a multi-faceted term-life/401K/thingy I have through Prudential which is doing well.

But my real retirement plan is that I have a 25% chance one of my four kids will make it financially and they'll build me a shack out back with wifi.

Why term? Does it expire when you retire?

It is not a traditional "term" policy it is a hybrid between term and life policy.

Gotcha, how long do you have until retirement? I only ask because sometimes there are ways to maximize your retirement income at little to no cost for your employer regarding the legacy retirement plan.

If I remember correctly my hybrid term thingy matures when I am 70 so that is my goal for retirement as well.

@ExPatriatePen

Vanguard to add China A-shares to its broad emerging markets ETF
http://in.mobile.reuters.com/article/id ... 2?irpc=932

Chinese investment opportunities scare me

Chinese investment opportunities scare me

I was reading today that the consensus is that their market is going to crash. Their stocks are overvalued by a lot P/E is about 65 plus a bunch of other stuff like the fact that most people take out loans to pay for stocks, government policies etc. But it may be avoided for a while. Not sure how long.