Page 1 of 1

VTTSX (TR 2060) vs VLXVX (TR 2065)

Posted: Thu Jul 13, 2017 5:20 pm
by jb1
Vanguard just released VLXVX (target retirement 2065). At a price of $20 im rather intrigued to swap it in place of my TR 2060. I feel all these target retirement fund start at $20, go up $10-15 then linger (am i wrong here)?

Thoughts on doing so? TR 2065 still has a 90/10 stock/bond split.

Re: VTTSX (TR 2060) vs VLXVX (TR 2065)

Posted: Thu Jul 13, 2017 5:26 pm
by PFInterest
do you realize the price has nothing to do with it?

Re: VTTSX (TR 2060) vs VLXVX (TR 2065)

Posted: Thu Jul 13, 2017 5:41 pm
by FiveK
jb1 wrote: (am i wrong here)?
Yes. Would that it were so easy....

Note that the funds underlying these two funds of funds are identical: Vanguard - Vanguard Target Retirement 2060 Fund and Vanguard - Vanguard launches Target Retirement 2065 products.

When you buy one share of VLXVX, in effect your $20 will be split in the 54/36/7/3 ratio to buy the respective fraction of each underlying fund. Buying 1 share of VTTSX, your ~$32 will be split in the same way, buying 32/20 as much of the underlying funds.

Whatever the underlying funds do from here on out, the percentage change in VTTSX and VLXVX will be identical (until Vanguard starts changing the target date fund's composition).

Does that make sense?

Re: VTTSX (TR 2060) vs VLXVX (TR 2065)

Posted: Thu Jul 13, 2017 6:16 pm
by raven15
jb1 wrote:Vanguard just released VLXVX (target retirement 2065). At a price of $20 im rather intrigued to swap it in place of my TR 2060. I feel all these target retirement fund start at $20, go up $10-15 then linger (am i wrong here)?

Thoughts on doing so? TR 2065 still has a 90/10 stock/bond split.
I would just choose whichever date was nearest to me turning 70, based on the current glide path.

Re: VTTSX (TR 2060) vs VLXVX (TR 2065)

Posted: Thu Jul 13, 2017 7:00 pm
by billfromct
When it comes to the Vanguard Target Date Funds, they all start out 90%/10% stocks/bonds, then migrate the asset allocation is about 50%/50%, stocks/bonds at their target year & something like 30%/70% stocks/bonds 7 years after the target year & there after.

Maybe a little too conservative for me, but you got to love the ease of use.

bill

Re: VTTSX (TR 2060) vs VLXVX (TR 2065)

Posted: Fri Jul 14, 2017 6:26 am
by nps
Take a look at the glidepaths for these funds on the Vanguard website and note how many years it will take until they cease to invest exactly the same way in exactly the same underlying funds.