Investing using Rick Ferri's 4 core. Need execution help !

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
mixinvest
Posts: 118
Joined: Sun Jan 31, 2016 2:45 pm

Investing using Rick Ferri's 4 core. Need execution help !

Post by mixinvest » Sat May 14, 2016 7:31 am

Hi all

I am going to investing $200K using Rick Ferri's 4 core lazy portfolio
- Vanguard Total Bond Market Index Fund (40%)
- Vanguard Total Stock Market Index Fund (30%)
- Vanguard Total International Stock Index Fund (24%)
- Vanguard REIT Index Fund (6%)

Any particular advice in terms of how to execute the purchase of shares?
- Limit order: otherwise the price will go mad with a market order, but i get the risk of the order not filling ?
- Online or on the phone? I read that for high volumes brokers can find liquidity that is not seen online. What is considered high volume?
- Dollar Cost average or not: maybe 4 chunks of 50k?

Thanks

staybalanced
Posts: 321
Joined: Wed Jan 14, 2015 7:36 am

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by staybalanced » Sat May 14, 2016 8:08 am

mixinvest wrote:Hi all

I am going to investing $200K using Rick Ferri's 4 core lazy portfolio
- Vanguard Total Bond Market Index Fund (40%)
- Vanguard Total Stock Market Index Fund (30%)
- Vanguard Total International Stock Index Fund (24%)
- Vanguard REIT Index Fund (6%)

Any particular advice in terms of how to execute the purchase of shares?
- Limit order: otherwise the price will go mad with a market order, but i get the risk of the order not filling ?
- Online or on the phone? I read that for high volumes brokers can find liquidity that is not seen online. What is considered high volume?
- Dollar Cost average or not: maybe 4 chunks of 50k?

Thanks


You could use mutual funds (admiral shares) and not have to worry about the order. Otherwise use a limit order and enter it at the ask price, it will execute immediately. Those funds are very liquid so bid/ask spreads are usually pennies.

I would use online, I don't see a reason to call unless you need help.

I would do it all at once, Jack Bogle has said the same. If you are using ETF you may need to do a couple of orders in round lots like 500 shares each time. Just depends.

User avatar
in_reality
Posts: 4278
Joined: Fri Jul 12, 2013 6:13 am

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by in_reality » Sat May 14, 2016 8:16 am

mixinvest wrote: - Limit order: otherwise the price will go mad with a market order, but i get the risk of the order not filling ?


Use a marketable limit order. It will get filled with risk of madness.

Example

Bid $21.50 Ask $21.53

Place your limit to buy at $21.55

You might get a better price that $21.55, (maybe $21.53 or whatever is on the table) but that is the most you will pay. If the market is volatile and moves to $21.56, then yes it won't get filled. Just reenter it maybe with a little more too to spare.

User avatar
samsoes
Posts: 406
Joined: Tue Mar 05, 2013 9:12 am

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by samsoes » Sat May 14, 2016 8:31 am

Just to make things easier, less chaotic:

I'd suggest filling completely each of the 4 ETF's one-at-a-time, in inverse order of the allocation % (completely fill REIT fund at 6% allocation then move on to the 24% international fund, then 30% stock fund, then 40% bond fund).
"Happiness Is Not My Companion" - Gen. Gouverneur K. Warren. (Avatar is the statue of Gen. Warren at Little Round Top @ Gettysburg National Military Park.)

staybalanced
Posts: 321
Joined: Wed Jan 14, 2015 7:36 am

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by staybalanced » Sat May 14, 2016 8:33 am

Another Idea would be to use the life strategy moderate growth and forget the reits. Keep it simple. You may or may not have better results with a slice and dice.

I have read ricks book and think he is very smart and brings a lot to the forum etc. However I mostly use target retirement funds. It is much easier to stay the course this way.

mixinvest
Posts: 118
Joined: Sun Jan 31, 2016 2:45 pm

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by mixinvest » Sat May 14, 2016 9:01 am

InvestorAdam wrote:You could use mutual funds (admiral shares) and not have to worry about the order. .


I honestly know nothing about admiral shares, but i will take a look
Last edited by mixinvest on Sat May 14, 2016 9:03 am, edited 1 time in total.

mixinvest
Posts: 118
Joined: Sun Jan 31, 2016 2:45 pm

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by mixinvest » Sat May 14, 2016 9:02 am

samsoes wrote:Just to make things easier, less chaotic:

I'd suggest filling completely each of the 4 ETF's one-at-a-time, in inverse order of the allocation % (completely fill REIT fund at 6% allocation then move on to the 24% international fund, then 30% stock fund, then 40% bond fund).


I like this idea. thanks

Lafder
Posts: 3553
Joined: Sat Aug 03, 2013 7:56 pm
Location: East of the Rio Grande

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by Lafder » Sat May 14, 2016 9:48 am

Admiral shares have the same expenses as the ETF versions at Vanguard.

Buying and selling mutual funds is much easier than ETFs since all you do is enter how much to buy or sell and you do not have to enter anything about the price. The price is just what it is at the end of that day. The orders to buy/sell can be made at any time even if the markets are closed and are applied the next day.( I believe ETF orders can only be placed when markets are open, which is when many folks are at work).

You can search more on this site for ETF vs mutual funds. Yes you can own ETFs of a mutual fund. But the mechanics are different.

lafder

looking
Posts: 613
Joined: Thu Mar 01, 2007 7:14 pm
Location: morgan hill ,ca

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by looking » Sat May 14, 2016 9:52 am

i rather sd is better

mixinvest
Posts: 118
Joined: Sun Jan 31, 2016 2:45 pm

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by mixinvest » Sat May 14, 2016 11:01 am

Lafder wrote:Admiral shares have the same expenses as the ETF versions at Vanguard.

Buying and selling mutual funds is much easier than ETFs since all you do is enter how much to buy or sell and you do not have to enter anything about the price. The price is just what it is at the end of that day. The orders to buy/sell can be made at any time even if the markets are closed and are applied the next day.( I believe ETF orders can only be placed when markets are open, which is when many folks are at work).

You can search more on this site for ETF vs mutual funds. Yes you can own ETFs of a mutual fund. But the mechanics are different.

lafder


Interesting. I will check if they can be bought from Ireland

Thanks

User avatar
in_reality
Posts: 4278
Joined: Fri Jul 12, 2013 6:13 am

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by in_reality » Sat May 14, 2016 11:37 am

mixinvest wrote:
Lafder wrote:Admiral shares have the same expenses as the ETF versions at Vanguard.

Buying and selling mutual funds is much easier than ETFs since all you do is enter how much to buy or sell and you do not have to enter anything about the price. The price is just what it is at the end of that day. The orders to buy/sell can be made at any time even if the markets are closed and are applied the next day.( I believe ETF orders can only be placed when markets are open, which is when many folks are at work).

You can search more on this site for ETF vs mutual funds. Yes you can own ETFs of a mutual fund. But the mechanics are different.

lafder


Interesting. I will check if they can be bought from Ireland

Thanks


I'd be surprised if you can.

Non-US residents including US citizens abroad usually can't for tax reasons. Somebody will probably post ...but Vanguard has been letting me do it for years....those are generally exceptions for one reason or another though I think.

See about the middle where Non US Residents holding mutual funds is discussed.

http://thunfinancial.com/us-brokerage-a ... osed-2015/

User avatar
Rick Ferri
Posts: 8202
Joined: Mon Feb 26, 2007 11:40 am
Location: Vagabond, USA, Twitter: @Rick_Ferri
Contact:

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by Rick Ferri » Sat May 14, 2016 12:14 pm

This is really cool...

PORTFOLIO CHARTS: Rick Ferri Core Four Portfolio

Rick Ferri

Note: the data used to calculate returns is as the author reported it and I have not independently verified this data.
Last edited by Rick Ferri on Sat May 14, 2016 12:50 pm, edited 2 times in total.
The views expressed by Rick Ferri are strictly his own as a private investor and author and do not reflect the views of any entity or other persons.

User avatar
samsoes
Posts: 406
Joined: Tue Mar 05, 2013 9:12 am

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by samsoes » Sat May 14, 2016 12:49 pm

Rick Ferri wrote:This is really cool...

PORTFOLIO CHARTS: Rice Ferri Core Four Portfolio

Rick Ferri

Note: the data used to calculate returns is as the author reported it and I have not independently verified this data.


With apologies to Mr. Delman, I presume. :happy
"Happiness Is Not My Companion" - Gen. Gouverneur K. Warren. (Avatar is the statue of Gen. Warren at Little Round Top @ Gettysburg National Military Park.)

User avatar
Rick Ferri
Posts: 8202
Joined: Mon Feb 26, 2007 11:40 am
Location: Vagabond, USA, Twitter: @Rick_Ferri
Contact:

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by Rick Ferri » Sat May 14, 2016 12:51 pm

:oops:
The views expressed by Rick Ferri are strictly his own as a private investor and author and do not reflect the views of any entity or other persons.

wawoodjr
Posts: 39
Joined: Sun May 10, 2009 9:43 am

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by wawoodjr » Sat May 14, 2016 2:25 pm

samsoes wrote:
Rick Ferri wrote:This is really cool...

PORTFOLIO CHARTS: Rice Ferri Core Four Portfolio

Rick Ferri

Note: the data used to calculate returns is as the author reported it and I have not independently verified this data.


With apologies to Mr. Delman, I presume. :happy


Always nice to see Rick posting. Thanks for passing along the Portfolio Charts website. He owes no one any apologies.

User avatar
samsoes
Posts: 406
Joined: Tue Mar 05, 2013 9:12 am

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by samsoes » Sat May 14, 2016 2:57 pm

wawoodjr wrote:
samsoes wrote:
Rick Ferri wrote:This is really cool...

PORTFOLIO CHARTS: Rice Ferri Core Four Portfolio

Rick Ferri

Note: the data used to calculate returns is as the author reported it and I have not independently verified this data.


With apologies to Mr. Delman, I presume. :happy


Always nice to see Rick posting. Thanks for passing along the Portfolio Charts website. He owes no one any apologies.


With all due respect, wawoodjr, I don't think you got the joke. Rick got it :mrgreen: .
"Happiness Is Not My Companion" - Gen. Gouverneur K. Warren. (Avatar is the statue of Gen. Warren at Little Round Top @ Gettysburg National Military Park.)

User avatar
stratton
Posts: 11080
Joined: Sun Mar 04, 2007 5:05 pm
Location: Puget Sound

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by stratton » Sat May 14, 2016 3:02 pm

Rick Ferri wrote::oops:

"Ric Eferri" has a nice ring to it! :P
...and then Buffy staked Edward. The end.

User avatar
abuss368
Posts: 11670
Joined: Mon Aug 03, 2009 2:33 pm
Location: Where the water is warm, the drinks are cold, and I don't know the names of the players!

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by abuss368 » Sat May 14, 2016 6:04 pm

The Core Four is an excellent investment portfolio that includes all os the major asset classes: stocks, bonds, real estate, and assuming you hold cash in a bank account.

This portfolio is low cost, very diversified, no manager risks, no style risks, and best of all simple and easy to manage.
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + U.S. & International REITs

User avatar
in_reality
Posts: 4278
Joined: Fri Jul 12, 2013 6:13 am

Re: Investing using Rick Ferri's 4 core. Need execution help !

Post by in_reality » Sat May 14, 2016 10:05 pm

@mixinvest

Did you ever get your thinking on currency figured out.

You mentioned euro bonds and maybe looking at an international REIT. VNQI is a good choice but not so heavy in EURO which is your home currency I
believe.

Also, you mentioned being in USD now so you want to invest in USD. Did you get the point that other mentioned that your currency exposure is determined by the stocks and not the funds. So even if VNQI is USD denominated, your currency exposure is not USD but rather 20% EURO 50% asian currencies etc. etc. or whatever the breakdown of the fund is in terms of where it's invested.

Just checking....

Post Reply