The new 1 fund portfolio

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jmaga1
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The new 1 fund portfolio

Post by jmaga1 » Sat Jul 27, 2019 1:19 am

Hello,

I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.


Thank you!!

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walletless
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Re: The new 1 fund portfolio

Post by walletless » Sat Jul 27, 2019 1:39 am

If you like one fund, look at Vanguard LifeStrategy funds. It's a single diversified fund containing U.S & International equity, as well as bonds.

If you don't want bonds for some reason, then Vanguard total world market (VTWAX) should suffice.

I don't know if it'll beat VTSAX or not (nobody does), but it's a good diversified fund.

minimalistmarc
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Re: The new 1 fund portfolio

Post by minimalistmarc » Sat Jul 27, 2019 2:33 am

At 23 you don’t want bonds so I would go for vanguard all world VTWAX, and then just keep chucking any money you have into it.

Shamb3
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Re: The new 1 fund portfolio

Post by Shamb3 » Sat Jul 27, 2019 7:11 am

Obviously, no one knows what will perform better in the next 20-30 years.
It could easily go either way especially in the short term.
Figure out If you want the market in international or not.

I personally like the US and a few specific countries a lot better than the total world market, but I have a small percentage in international now just for diversification sake.

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Re: The new 1 fund portfolio

Post by Sandtrap » Sat Jul 27, 2019 7:34 am

jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
Hello,

I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.


Thank you!!
Options:

1. Pick a Lifestrategy Fund and stick with it.
2. Pick a Target Retirement Fund and stick with it.
3. Pick Balanced Index Fund at 60/40 and stick with it.

All would do well.
However, what is "top performing" is a myth. At any one period of time certain funds and allocations will do well, other times not so. Over the long haul, not a huge difference.

j
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Re: The new 1 fund portfolio

Post by pokebowl » Sat Jul 27, 2019 9:39 am

jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
Hello,

I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.


Thank you!!
If your choices are only between those two funds, then VTWAX total world would be the better of the two options. A counter argument however, is if you will be making regular recurring contributions to this fund, it may make more sense to split VTWAX into its sub-components (VTSAX/VTIAX) for better tax loss harvesting opportunities. Regardless VTWAX is a great fund, for long term holding. In terms of top performing, no one knows the future.
Nullius in verba.

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Re: The new 1 fund portfolio

Post by fortyofforty » Sat Jul 27, 2019 9:58 am

jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
Hello,

I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.


Thank you!!
Welcome.

For the elusive "one fund" solution, I'd suggest LifeStrategy Growth. However, if you prefer to go all in on equities, perhaps divide up your allocation, half in Total International and Total Stock Market. Then, as money comes in, keep "rebalancing" back to 50% in each. That way, you're forced to buy more of the underperforming fund (buying low) and less of the outperforming fund. Keep in mind you might seem to be adding more to one or the other for months or years, as it never seems to catch up, so patience and confidence are required.
Indexing works, not because of magic, but because of math. | Diligentia. Vis. Celeritas. - Jeff Cooper | Original Vanguard Diehard

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nisiprius
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Re: The new 1 fund portfolio

Post by nisiprius » Sat Jul 27, 2019 10:27 am

VTSAX isn't "the top-performing index." And nobody should expect it to be.

It is reasonable to hope that investors will demand more return in exchange for taking more risk. Therefore, indexes of riskier stock subsets ought to have higher return than VTSAX.

The most familiar example is small-cap value. And indeed, since inception--and if you bought it before 2000-2002--the Vanguard Small-Cap Value Index Fund, VISVX, has outperformed VTSAX. For those who held it, or similar funds--I didn't--it must really have felt wonderful to watch it going up when the stock market as a whole was going down. Alas, that didn't happen in 2008-2009.

Source

Image

Whether or not investors should have a "small-cap value tilt" is one of the most perennial topics of debate in the forum. One point is that is that it has had, and is expected to have, higher risk to go along with the higher return. Another point is that for the last ten years or so, small-cap value has about tied the market.

As for VTSAX vs VTWAX, there is intense debate on how much international stocks a conservative, prudent, US investor ought to hold. There is no objectively right answer. It depends on your personal convictions.

VTSAX is an obvious, sensible "default choice" for investors who want to invest in the US stock market.

VTWAX is an obvious, sensible "default choice" for investors who want to invest globally, roughly 50/50 US/international, giving international the full capitalization weight it has within the total set of national stock markets of all countries (there is no "global stock market.")

It would be foolish to predict which will be "top-performing" going forward.

I personally am in between. I don't use VTWAX because I prefer to hold more than 50% US and less than 50% international. That is just "full disclosure," not a recommendation.

I am now going to throw a little gasoline on the fire by stating an accurate fact but also warning you that it is highly misleading if you don't look behind it. From 1900 through 2017, the average real returns (CAGR inflation-adjusted and including dividends) were:

6.5% for the US stock market (i.e. like VTSAX)
5.2% for the total of the world's stock markets, including the US (i.e. like VTWAX)

So: tell me, what am I hiding? Why is 118 years of data misleading?
Last edited by nisiprius on Sat Jul 27, 2019 11:49 am, edited 3 times in total.
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Taylor Larimore
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Misleading numbers. Why?

Post by Taylor Larimore » Sat Jul 27, 2019 10:33 am

So: tell me, what am I not mentioning? Why are these numbers highly misleading?
Because past performance does not forecast future performance.
Best wishes.
Taylor
Jack Bogle's Words of Wisdom: ""The biggest mistake investors make is looking backward at performance and thinking it’ll recur in the future."
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Re: Misleading numbers. Why?

Post by dharrythomas » Sat Jul 27, 2019 10:52 am

Taylor Larimore wrote:
Sat Jul 27, 2019 10:33 am
So: tell me, what am I not mentioning? Why are these numbers highly misleading?
Because past performance does not forecast future performance.
Best wishes.
Taylor
Jack Bogle's Words of Wisdom: ""The biggest mistake investors make is looking backward at performance and thinking it’ll recur in the future."
Taylor,

I’m surprised at you. Nisiprius left out the fact that a large proportion of the world’s productive capability were destroyed in WWI and WWII, the US was called the “Arsenal of Democracy” for a reason.

We rebuilt Western Europe with the Marshall Plan, rebuilt Japan & South Korea, and designed the World Bank, International Monetary Fund, the World Trade Organization, and the entire global economic regime to benefit US banks and business. Taking over as the world’s reserve currency helps, But, everything I mentioned stems from not being a locus of ground warfare in two world wars.

I will again thank you for your service as a paratrooper in the 101st Airborne Division in WWII.

Harry

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Re: The new 1 fund portfolio

Post by chevca » Sat Jul 27, 2019 10:59 am

jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.
Top performing index? Where did you get that either of them are the top performer?

Either way, both a reasonable choices, IMO. Obviously, you have the international side with one of them. When the US is doing well or better than international, VTSAX will be doing better. When international is doing well or better than the US, VTWAX will be doing better. It's just that simple. It will likely go back and forth though, so I'd wager neither will perform better than the other forever. Take your pick.

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Re: Misleading numbers. Why?

Post by nisiprius » Sat Jul 27, 2019 11:56 am

dharrythomas wrote:
Sat Jul 27, 2019 10:52 am
I wrote:So: tell me, what am I not mentioning? Why are these numbers highly misleading?
Taylor Larimore wrote:Because past performance does not forecast future performance.
...Nisiprius left out the fact that a large proportion of the world’s productive capability were destroyed in WWI and WWII, the US was called the “Arsenal of Democracy” for a reason.

We rebuilt Western Europe with the Marshall Plan, rebuilt Japan & South Korea, and designed the World Bank, International Monetary Fund, the World Trade Organization, and the entire global economic regime to benefit US banks and business. Taking over as the world’s reserve currency helps, But, everything I mentioned stems from not being a locus of ground warfare in two world wars.

[Taylor], I will again thank you for your service as a paratrooper in the 101st Airborne Division in WWII.

Harry
+1

I was hoping I could be the one to do the "reveal" but I can't really add anything to this excellent answer, except to add my thanks to Taylor Larimore, too.
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.

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Re: The new 1 fund portfolio

Post by LadyGeek » Sat Jul 27, 2019 12:23 pm

This thread is now in the Personal Investments forum (portfolio help).

The wiki has some background info: Vanguard LifeStrategy Funds
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Re: The new 1 fund portfolio

Post by abuss368 » Sat Jul 27, 2019 12:44 pm

jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
Hello,

I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.


Thank you!!
Not sure what the ticker symbols are. Total Stock and Total World possibly? I would stick with individual funds as it may be lower cost, more holdings and thus additional diversification, and affords possible rebalancing opportunities.
John C. Bogle - Two Fund Portfolio: Total Stock & Total Bond. "Simplicity is the master key to financial success."

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Re: The new 1 fund portfolio

Post by abuss368 » Sat Jul 27, 2019 12:47 pm

jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
Hello,

I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.


Thank you!!
Remember Jack Bogle has always said “simplicity is the master key to financial success”!
John C. Bogle - Two Fund Portfolio: Total Stock & Total Bond. "Simplicity is the master key to financial success."

jibantik
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Re: The new 1 fund portfolio

Post by jibantik » Sat Jul 27, 2019 1:11 pm

VTWAX hands down. Buy the haystack.

UpperNwGuy
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Re: The new 1 fund portfolio

Post by UpperNwGuy » Sat Jul 27, 2019 1:26 pm

VTSAX.

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Taylor Larimore
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Re: The new 1 fund portfolio ?

Post by Taylor Larimore » Sat Jul 27, 2019 3:03 pm

jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
Hello,

I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.


Thank you!!
jmaga1:

I suggest you sell your individual stocks before you get locked-in with taxable capital-gains:

What Expert Say About Individual Stocks

Take a look at the The Three-Fund Portfolio.

Best wishes.
Taylor
"Simplicity is the master key to financial success." -- Jack Bogle

nix4me
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Re: The new 1 fund portfolio

Post by nix4me » Sat Jul 27, 2019 3:14 pm

Bonds don't belong in a taxable Brokerage account. So all the people recommending Lifestrategy funds are wrong. Don't do that.

I have no confidence in International - thus i use VTI in my taxable brokerage.
VTSAX would be my recommendation. Total world would be fine choice as long as you realize international has/is not performing well.

https://www.portfoliovisualizer.com/bac ... 0&total3=0

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Re: The new 1 fund portfolio

Post by 9-5 Suited » Sat Jul 27, 2019 3:28 pm

nix4me wrote:
Sat Jul 27, 2019 3:14 pm
Bonds don't belong in a taxable Brokerage account. So all the people recommending Lifestrategy funds are wrong. Don't do that.

I have no confidence in International - thus i use VTI in my taxable brokerage.
VTSAX would be my recommendation. Total world would be fine choice as long as you realize international has/is not performing well.

https://www.portfoliovisualizer.com/bac ... 0&total3=0
Those people aren’t wrong. It’s okay for an individual to opt to trade off tax efficiency for simplicity in a portfolio. Right and wrong isn’t a helpful framework for investing choices like that so long as the person understands the trade off. I optimize for tax efficiency like you do, but I think it’s very overrated in the sense that it’s not that likely to change the tangible outcome of one’s financial life.

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Re: The new 1 fund portfolio

Post by pokebowl » Sat Jul 27, 2019 5:01 pm

nix4me wrote:
Sat Jul 27, 2019 3:14 pm
Total world would be fine choice as long as you realize international has/is not performing well.

https://www.portfoliovisualizer.com/bac ... 0&total3=0
Your initial link shows international and US from 2009-present. Using the same criteria of 10 years, here is another link for the prior decade to that.

Granted the decade prior to even that was in U.S. favor (Dot com boom), then the 60s-80s went to international. Plenty of history of U.S. and Ex-US markets playing leap frog with each other. Enough that I would not want to bet the house/retirement on either in isolation. :beer
Nullius in verba.

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Re: The new 1 fund portfolio

Post by schooner » Sat Jul 27, 2019 5:22 pm

All good Vanguard option above. I think the most important decision is not which fund, but the ability to stick with it for the long term.

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Re: The new 1 fund portfolio

Post by burt » Sat Jul 27, 2019 5:34 pm

Sandtrap wrote:
Sat Jul 27, 2019 7:34 am
jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
Hello,

I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.


Thank you!!
Options:

1. Pick a Lifestrategy Fund and stick with it.
2. Pick a Target Retirement Fund and stick with it.
3. Pick Balanced Index Fund at 60/40 and stick with it.

All would do well.
However, what is "top performing" is a myth. At any one period of time certain funds and allocations will do well, other times not so. Over the long haul, not a huge difference.

j
+1
Very Good.

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Re: The new 1 fund portfolio

Post by oldzey » Sat Jul 27, 2019 6:03 pm

jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
Hello,

I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.


Thank you!!
For a 23 year old U.S. investor, here's my recommendation:

Image

Here's a comparison between the two funds (note that VT is the ETF version of VTWAX): M* Chart
"The broker said the stock was 'poised to move.' Silly me, I thought he meant up." ― Randy Thurman

jibantik
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Re: The new 1 fund portfolio

Post by jibantik » Sat Jul 27, 2019 7:45 pm

UpperNwGuy wrote:
Sat Jul 27, 2019 1:26 pm
VTSAX.
Why VTSAX over VTWAX?
oldzey wrote:
Sat Jul 27, 2019 6:03 pm
For a 23 year old U.S. investor, here's my recommendation:

Image

Here's a comparison between the two funds (note that VT is the ETF version of VTWAX): M* Chart
I am curious, what should be the takeaway of that chart? Are you suggesting that his decision should be influenced by that chart? As you probably know, basing decision on past performance is terribly stupid and goes against core philosophies of being a boglehead.

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Re: The new 1 fund portfolio

Post by David Jay » Sat Jul 27, 2019 8:14 pm

9-5 Suited wrote:
Sat Jul 27, 2019 3:28 pm
Right and wrong isn’t a helpful framework for investing choices...
Can we carve out an exception for Variable Annuities inside an IRA? :annoyed
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

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jmaga1
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Re: The new 1 fund portfolio

Post by jmaga1 » Sat Jul 27, 2019 8:33 pm

abuss368 wrote:
Sat Jul 27, 2019 12:47 pm
jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
Hello,

I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.


Thank you!!
Remember Jack Bogle has always said “simplicity is the master key to financial success”!
That's exactly why I'm asking because I want to simply just put in as much money possible

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Re: The new 1 fund portfolio

Post by Chris K Jones » Sat Jul 27, 2019 8:59 pm

Personally 50% international is a bit much for me. I use 20%. How about 80% VTSAX and 20 % VTIAX or 60% VTSAX and 40% VTWAX?

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Re: The new 1 fund portfolio

Post by oldzey » Sat Jul 27, 2019 9:03 pm

Let's go back 23 years, to the inception date of VTIAX, and compare its performance with VTSAX: M* Chart
"The broker said the stock was 'poised to move.' Silly me, I thought he meant up." ― Randy Thurman

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Re: The new 1 fund portfolio

Post by lostdog » Sat Jul 27, 2019 9:27 pm

oldzey wrote:
Sat Jul 27, 2019 9:03 pm
Let's go back 23 years, to the inception date of VTIAX, and compare its performance with VTSAX: M* Chart
Make sure to let the OP know you're full of recency bias, performance chasing, American exceptionalism, have a make believe crystal ball , don't invest in international because Jack said so and you throw the boglehead principles out the window.

Yeah he was "right" for the last 10 years and the cherry picked years but OP you literally need to buy the haystack. No one knows nuthin.
VTWAX and chill.

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Re: The new 1 fund portfolio

Post by oldzey » Sun Jul 28, 2019 12:51 am

As a 1 fund portfolio (which has healthily outperformed both VTWAX and VTIAX since inception), VTSAX has the additional benefit of sparking joy.

Image
"The broker said the stock was 'poised to move.' Silly me, I thought he meant up." ― Randy Thurman

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Re: The new 1 fund portfolio

Post by Longtermgrowth » Sun Jul 28, 2019 4:56 am

oldzey wrote:
Sun Jul 28, 2019 12:51 am
As a 1 fund portfolio (which has healthily outperformed both VTWAX and VTIAX since inception), VTSAX has the additional benefit of sparking joy.

Image
LOL! While I'm all for the US continuing to dominate even in the equity markets, valuations ex-US can't be ignored. I'm probably in the majority here in the belief that holding all equity in one country isn't the wisest decision.

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Re: The new 1 fund portfolio

Post by bogledogle87 » Sun Jul 28, 2019 7:30 am

I am a fellow 100% VTWAX one-funder in my early 30's. It fascinates me that most investors are in favor of passive equity indexing in the form of the S&P 500 or the Total US Market, many support the same approach to a fixed international exposure, but for some reason can't get on board with passively indexing the entire World.

For the 100% US investors, It seems hypocritical to sing the praises of the market cap approach, but then turn right around and limit that very approach to a single country while pointing to out-performance. With that logic, you might as well consider market cap weighting specific sectors like US Technology and avoid US Energy at all costs. I can understand some hesitation with currency, political, and regulation risk, but it's important to know that these factors are generally priced in to markets already. Diversification across currencies and valuations can be a very powerful for investors as well, especially if they have behaved differently in recent years.

For those with 30-50% already allocated to international, I might argue for at least considering taking the plunge into Total World instead of the fixed allocation/rebalance strategy. You have already accepted the market cap approach for the most part, along with the currency and political risks. What made you decide your specific % to international was optimal for you? What made you decide to reblancing international as if it were a different asset class rather than just carrying the market weight?

For any investor that is already sold on market cap weighting equities and acknowledges the benefits of international diversification, VTWAX is the natural starting point, with any other tilt in allocation requiring additional justification.
VTWAX and chill

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Re: The new 1 fund portfolio

Post by averagedude » Sun Jul 28, 2019 8:19 am

Yet another thread that ends up being a debate about what percentage of International should be in your portfolio. OP, i would determine what allocation you desire on domestic/international and then make a decision on what to invest in. You may achieve this with one fund, or you might need two funds to accomplish this. Having two funds instead of one fund is not complicated at all, and should require less than 15 minutes of your time in a given year. Don't get hung up on the idea that you can only invest in only one fund. Choosing to invest in VTSAX and VTIAX at 23 years old is reasonable and is very simple. If you are having a difficult time making a decision, just invest in VTWAX until you decide.

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Re: The new 1 fund portfolio

Post by Silence Dogood » Sun Jul 28, 2019 8:43 am

OP,

I would recommend at least 10% in bonds.

When I first started visiting this forum (circa 2010), it would have been considered reckless not to invest in bonds, at any age. Stocks have had an impressive 10 year run, but we don't know how long that will last.

Are you able to contribute to a tax advantaged account at all? Regardless, I still think bonds make sense.

Also, for what it's worth, I believe a combination of VTSAX (Vanguard Total U.S. Stock Market) and VTIAX (Vanguard Total International Stock Market) will give you more U.S. small-cap value exposure.

Personally, I think you would do well to choose a Vanguard Target Retirement fund with a 90/10 asset allocation. This would include both domestic/international stocks/bonds and would accomplish your goal of only one fund. I don't see a lot of downside for 90/10 compared to 100/0.

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Re: The new 1 fund portfolio

Post by LadyGeek » Sun Jul 28, 2019 9:24 am

The thread is starting to derail on the never-ending "US vs. International" equity allocation debate. Please stay on-topic to help the OP directly.
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Re: The new 1 fund portfolio

Post by dbr » Sun Jul 28, 2019 9:31 am

In general when investing in a taxable account for the long run you want to avoid building up unrealized gains in something you might not want to hold later. I think TSM is almost certainly going to be a fund you will want to hold in taxable forever and would therefore pick that for sure. It is likely an international stock fund would be wanted so that can be held as well. I think for my reasoning it would be a bad idea to start accumulating any form of balanced fund in a taxable account.

The bottom line is that it is probably not such a good idea to become enamored of a one fund solution.

jibantik
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Re: The new 1 fund portfolio

Post by jibantik » Sun Jul 28, 2019 11:09 am

Everyone suggesting that a 23yr old should hold 100% VTSAX instead of the global market (on a Bogleheads forum no less) should be absolutely ashamed of themselves. Very dangerous advice for someone with a 60 year investment horizon. I am sorry but you do not have a crystal ball that will tell you what is going to happen with tens of thousands of companies 60 years from now.

Also, the people trying to justify such a decision (probably as much to themselves as everyone else) using past performance shouldn't be allowed to call themselves a Boglehead.

Do whatever you want in your portfolio, speculate all you want, but to suggest it to a young person with such a long investment horizon is irresponsible.

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Re: The new 1 fund portfolio

Post by dbr » Sun Jul 28, 2019 11:20 am

jibantik wrote:
Sun Jul 28, 2019 11:09 am
Everyone suggesting that a 23yr old should hold 100% VTSAX instead of the global market (on a Bogleheads forum no less) should be absolutely ashamed of themselves. Very dangerous advice for someone with a 60 year investment horizon. I am sorry but you do not have a crystal ball that will tell you what is going to happen with tens of thousands of companies 60 years from now.

Also, the people trying to justify such a decision (probably as much to themselves as everyone else) using past performance shouldn't be allowed to call themselves a Boglehead.

Do whatever you want in your portfolio, speculate all you want, but to suggest it to a young person with such a long investment horizon is irresponsible.
A problem easily avoided if one recognizes that the problem is not about which fund but rather in going too far to boil everything down to one fund. LIke everything else in life things should be done in moderation, including simplification beyond reasonable.

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nisiprius
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Re: The new 1 fund portfolio

Post by nisiprius » Sun Jul 28, 2019 11:40 am

lostdog wrote:
Sat Jul 27, 2019 9:27 pm
...you literally need to buy the haystack...
There isn't a single global haystack. There's a haystack and a heuhaufen and an almiar and a meule de foin and a couple of dozen other national haystacks, and they are separate from each other. People run around between the haystacks carrying bits of hay from one and putting it on another when they think things are out of balance, but to get from one to another they have to climb over regulatory stiles and pay tolls at currency-exchange bridges. So it is not exactly "the" haystack.
Last edited by nisiprius on Sun Jul 28, 2019 5:55 pm, edited 1 time in total.
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.

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Re: The new 1 fund portfolio

Post by Silence Dogood » Sun Jul 28, 2019 5:47 pm

OP,

Looking at your prior posts, it appears that you may have both credit card debt (around $6K) and an auto loan (around $16k).

Do you still have this debt?

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Re: The new 1 fund portfolio

Post by UpperNwGuy » Sun Jul 28, 2019 6:33 pm

nisiprius wrote:
Sun Jul 28, 2019 11:40 am
lostdog wrote:
Sat Jul 27, 2019 9:27 pm
...you literally need to buy the haystack...
There isn't a single global haystack. There's a haystack and a heuhaufen and an almiar and a meule de foin and a couple of dozen other national haystacks, and they are separate from each other. People run around between the haystacks carrying bits of hay from one and putting it on another when they think things are out of balance, but to get from one to another they have to climb over regulatory stiles and pay tolls at currency-exchange bridges. So it is not exactly "the" haystack.
+1

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Re: The new 1 fund portfolio

Post by UpperNwGuy » Sun Jul 28, 2019 6:34 pm

Silence Dogood wrote:
Sun Jul 28, 2019 5:47 pm
OP,

Looking at your prior posts, it appears that you may have both credit card debt (around $6K) and an auto loan (around $16k).

Do you still have this debt?
Credit card debt is a problem. An auto loan is not a problem.

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Re: The new 1 fund portfolio

Post by Silence Dogood » Sun Jul 28, 2019 6:41 pm

nisiprius wrote:
Sun Jul 28, 2019 11:40 am
lostdog wrote:
Sat Jul 27, 2019 9:27 pm
...you literally need to buy the haystack...
There isn't a single global haystack. There's a haystack and a heuhaufen and an almiar and a meule de foin and a couple of dozen other national haystacks, and they are separate from each other. People run around between the haystacks carrying bits of hay from one and putting it on another when they think things are out of balance, but to get from one to another they have to climb over regulatory stiles and pay tolls at currency-exchange bridges. So it is not exactly "the" haystack.
I've always been curious why VTSAX (Vanguard Total U.S. Stock) and VTIAX (Vanguard Total International Stock) hold more stocks (combined) than VTWAX (Vanguard Total World Stock). Why is this the case?

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Re: The new 1 fund portfolio

Post by Silence Dogood » Sun Jul 28, 2019 6:47 pm

UpperNwGuy wrote:
Sun Jul 28, 2019 6:34 pm
Credit card debt is a problem. An auto loan is not a problem.
It looks like the OP has an auto loan at 4.8%. In my opinion, he/she should pay this off.

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Re: The new 1 fund portfolio

Post by asset_chaos » Sun Jul 28, 2019 6:57 pm

jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.
I have owned total world since inception, and my reasoning for holding total world stock index fund (vtwax) is markedly different than that. Just as total US stock fund (vtsax) hides the roiling noise of which subsectors of the US market are leading or lagging, total world dissolves all questions of how much invest in or worry about various subsets of companies. US, Europe, Asia, emerging markets, small, value, growth, foreign, domestic, how much in each? Total world simply obliterates these distinctions, and I find that makes total world simpler and easier for me to hold. That's ultimately my reasoning for choosing total world. Performance just didn't enter into it. I expect---as I do with all total market type funds---that total world will every year lag some subsets of stocks and beat some other subsets of stocks. Notice that unless you chose to look up the performance of subsets, you don't even have to aware of subset performance. Most importantly, as I am certain that I will not be able to identify these subsets in advance, I will simply own all of the subsets and just have stocks.

Others argue vehemently that they must at least set their foreign-domestic stock split, and I argue with no one investing in the way that makes it easier for them to hold stocks. But total world and the idea of just having stocks suits me better. I believe the real question for you is will total world suit you in a way that makes it easier for you to hold your stock investments through the inevitable stock market surprises and gyrations to come over your investing lifetime. Not potential for out performance, but that is a question worth pondering.
Regards, | | Guy

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Re: The new 1 fund portfolio

Post by UpperNwGuy » Sun Jul 28, 2019 7:31 pm

Silence Dogood wrote:
Sun Jul 28, 2019 6:47 pm
UpperNwGuy wrote:
Sun Jul 28, 2019 6:34 pm
Credit card debt is a problem. An auto loan is not a problem.
It looks like the OP has an auto loan at 4.8%. In my opinion, he/she should pay this off.
Why?

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Re: The new 1 fund portfolio

Post by UpperNwGuy » Sun Jul 28, 2019 7:38 pm

asset_chaos wrote:
Sun Jul 28, 2019 6:57 pm
jmaga1 wrote:
Sat Jul 27, 2019 1:19 am
I have about 20k in cash and about 60k in my brokerage account in which I've picked individual stocks. I want to do 1 fund portfolio as I can simply just add money monthly, currently 23 years of age. The real question is should it be invested in VTSAX or VTWAX. I've come upon the new VTWAX fund, and would like to see if you think its soon to replace VTSAX as the top performing index.
I have owned total world since inception, and my reasoning for holding total world stock index fund (vtwax) is markedly different than that. Just as total US stock fund (vtsax) hides the roiling noise of which subsectors of the US market are leading or lagging, total world dissolves all questions of how much invest in or worry about various subsets of companies. US, Europe, Asia, emerging markets, small, value, growth, foreign, domestic, how much in each? Total world simply obliterates these distinctions, and I find that makes total world simpler and easier for me to hold. That's ultimately my reasoning for choosing total world. Performance just didn't enter into it. I expect---as I do with all total market type funds---that total world will every year lag some subsets of stocks and beat some other subsets of stocks. Notice that unless you chose to look up the performance of subsets, you don't even have to aware of subset performance. Most importantly, as I am certain that I will not be able to identify these subsets in advance, I will simply own all of the subsets and just have stocks.

Others argue vehemently that they must at least set their foreign-domestic stock split, and I argue with no one investing in the way that makes it easier for them to hold stocks. But total world and the idea of just having stocks suits me better. I believe the real question for you is will total world suit you in a way that makes it easier for you to hold your stock investments through the inevitable stock market surprises and gyrations to come over your investing lifetime. Not potential for out performance, but that is a question worth pondering.
And I own a mix of Total Stock and Total International for most of the reasons you have given. The one decision I don't want to give up is my asset allocation between US and non-US stocks. Holding two funds instead of one allows me to do that.

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Re: The new 1 fund portfolio

Post by Silence Dogood » Sun Jul 28, 2019 8:23 pm

UpperNwGuy wrote:
Sun Jul 28, 2019 7:31 pm
Silence Dogood wrote:
Sun Jul 28, 2019 6:47 pm
It looks like the OP has an auto loan at 4.8%. In my opinion, he/she should pay this off.
Why?
In general, I don't like debt.

4.8% interest on a depreciating asset?

I have a small amount of student loan debt (around $6K). I'm not paying this off because my employer makes my monthly payments for me (a use-it-or-lose-it benefit: i.e. I would not be able to pocket this money).

Growing up (I'm in my late 20s), my family survived on debt - when the "great recession" hit, things went very badly.

Never again...

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Re: The new 1 fund portfolio

Post by jmaga1 » Mon Jul 29, 2019 11:41 pm

Silence Dogood wrote:
Sun Jul 28, 2019 5:47 pm
OP,

Looking at your prior posts, it appears that you may have both credit card debt (around $6K) and an auto loan (around $16k).

Do you still have this debt?
No longer have credit card debt and only have the loan, but I want to use it to build my credit.

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