Hey guys, my asset allocation is :
54% Vanguard S&P 500 ETF (VOO)
20% Vanguard Total Bond Market ETF (BND)
10% PowerShares QQQ ETF (QQQ)
16% Vanguard FTSE All-World ex-US ETF (VEU)
I'm 28 with a 6 figure portfolio held primarily in cash & equity in private companies. What do you think?
Thanks!
Thoughts on my portfolio?
Re: Thoughts on my portfolio?
Your presented list of ETFs is well within what is typically seen on this forum.
There has to be overlap between QQQ and VOO, right?
You are missing small-cap foreign. QQQ is no substitute for small/mid-cap US.
There has to be overlap between QQQ and VOO, right?
You are missing small-cap foreign. QQQ is no substitute for small/mid-cap US.
- sunnywindy
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Re: Thoughts on my portfolio?
What you present is significantly better than your present asset allocation and it will work just fine in the big scheme of things. But, to get better quality answers to your questions, you should give us more information in the approved format for portfolio allocation help.
I do have some (rhetorical) questions and I ask them mainly to challenge you to critically examine your choices.
- Why 54% and 16% allocations? (Usually people pick round numbers like 55% and 15% because they know 1% either way makes little difference. When I see posts with exacting numbers like your's, it's usually a red-flag to me for either performance chasing or some other investor mistake.)
- Why high beta QQQ and low beta BND in the same portfolio? Are you trying to 'barbell' the portfolio? (QQQ is very volatile, potential high returns, but will crash when the next bear market happens; BND is very stable but its real rate of return is close to zero.)
- Why the S&P 500 and not the whole US market (like VTI)? (VTI follows a much broader index of over 3,000 stocks and represents the entire stock market instead of just 500 hand-picked stocks.)
- Why no small caps? (You could improve your choices by using VXUS for VEU, and VTI instead of VOO.)
- Why a 20% bond allocation for someone age 28? (Vanguard Target Date 2060 uses only 10% bond allocation. Personally, I wouldn't use any bonds at that age although many would disagree with me on this.)
Good luck!
I do have some (rhetorical) questions and I ask them mainly to challenge you to critically examine your choices.
- Why 54% and 16% allocations? (Usually people pick round numbers like 55% and 15% because they know 1% either way makes little difference. When I see posts with exacting numbers like your's, it's usually a red-flag to me for either performance chasing or some other investor mistake.)
- Why high beta QQQ and low beta BND in the same portfolio? Are you trying to 'barbell' the portfolio? (QQQ is very volatile, potential high returns, but will crash when the next bear market happens; BND is very stable but its real rate of return is close to zero.)
- Why the S&P 500 and not the whole US market (like VTI)? (VTI follows a much broader index of over 3,000 stocks and represents the entire stock market instead of just 500 hand-picked stocks.)
- Why no small caps? (You could improve your choices by using VXUS for VEU, and VTI instead of VOO.)
- Why a 20% bond allocation for someone age 28? (Vanguard Target Date 2060 uses only 10% bond allocation. Personally, I wouldn't use any bonds at that age although many would disagree with me on this.)
Good luck!
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Re: Thoughts on my portfolio?
I'd ditch QQQ and invest the money in VEU to achieve an AA of approximately 55/20/25.
Global stocks, US bonds, and time.