Help with ETF Portfolio?

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Styx1977
Posts: 1
Joined: Tue Jan 23, 2018 12:57 pm

Help with ETF Portfolio?

Post by Styx1977 »

Hi everyone!

I hope you are well. I am 23 and very new to the investment world, but just put some money into ETFs:

-Vanguard Total International Stock Market (34 shares)
-Vanguard Total World Stock (13)
-First Trust Nasdaq 100 Technology Index (26)
-iShares Core S&P Total US Stock Market (32)
-iShares Edge MSCI Multifactor International (26)
-Schwab US Broad Market (30)

Do you all think these were good decisions. And if I want to invest a few thousand more, would you recommend I stick to these or move onto a different ETF?

Thanks so much for your help!
Captain kangaroo
Posts: 94
Joined: Sun Nov 26, 2017 11:45 pm

Re: Help with ETF Portfolio?

Post by Captain kangaroo »

Way too much overlap. You're holding the same stocks in multiple funds.

Consolidate to a US total market fund and a international fund.
bloom2708
Posts: 9859
Joined: Wed Apr 02, 2014 2:08 pm

Re: Help with ETF Portfolio?

Post by bloom2708 »

Welcome!

Start here: https://www.bogleheads.org/wiki/Boglehe ... philosophy

You bought some good funds. You just bought similar things over and over again. Much overlap and redundancy.

Take away the tickers the think about the market:

All the stocks in the US (Fund 1)
All the stocks everywhere except the US (Fund 2)


If you bought these two index funds, you would own all the stocks in the world at the market cap (how big the companies are).

Now, if you buy the biggest 100 in the US, did you already own them? Yep. They are in Fund 1.

So you bought the World (US + International). You bought the US 2 times. You bought all the international stocks 2 times. You bought the top 100 US.

It is difficult not to think of index funds like stocks. Buying more gives you more diversity. With index funds, it doesn't work like that. You are buying the same thing over and over and paying little fees (expense ratios, trade fees) for each purchase.

You can look under the covers of each fund and see how many stocks each fund owns. Vanguard Total US has ~3,600 stocks. Vanguard Total International has ~9,600 stocks.

Even at 23, I'd recommend 10 to 20% bonds. Bonds add safety to your portfolio.

Total US stock index
Total International stock index (20 to 50% of your stocks)
Total US Bond index (401k, Roth IRA, IRA) or Int-Term Tax-Exempt bonds (taxable account)

That is your 3 fund portfolio. Low cost and diversified. When you have more money you buy more of those 3 things.

At 23, you are off to a great start. If you hang out here you will learn a bunch and course correct. The key at your age is saving. Pre-tax 401k. Roth IRA. HSA. Use your retirement buckets and work toward filling them up.

Welcome again!
Last edited by bloom2708 on Tue Jan 23, 2018 2:48 pm, edited 1 time in total.
livesoft
Posts: 86075
Joined: Thu Mar 01, 2007 7:00 pm

Re: Help with ETF Portfolio?

Post by livesoft »

How about taking a step back and tell us what your goals for this money are AND what your desired asset allocation is without reference to any ETFs whatsoever. Also which broker are you using, because if you are paying commissions for any of these, then you are probably doing it in a way that I would not recommend.
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Mors
Posts: 277
Joined: Wed Aug 16, 2017 10:06 am

Re: Help with ETF Portfolio?

Post by Mors »

Greetings. Etfs are cheap and diversified usually (your technology etf is definitely a focused sector bet), however another important thing of a portfolio is simplicity. There is no reason to have stocks, countries and sectors overlapping in different etfs if there is not something of value to gain. so this is a place where you can imrove as others have said. Start with a core of us stock market etf (VTI) / international stock market etf (VXUS) and add upon this whatever else you fancy, in small allocations (the core and satellites model).
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