VXUS vs VTI -- why invest in VXUS?

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pappupager
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VXUS vs VTI -- why invest in VXUS?

Post by pappupager »

I am 75-15-10 (VTI/VXUS/BND). Looking at VXUS specifically, the price has been the same in 2012 vs 2022, while during the same duration, VTI has quadrupled. No one has the crystal ball, and past performance is no indicator of the future, but why does everyone push heavily for VXUS as a counter for VTI? I would like a counter that has been profitable over a long duration of time.

Thoughts?
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Re: VXUS vs VTI -- why invest in VXUS?

Post by pizzy »

pappupager wrote: Wed Sep 21, 2022 10:31 am past performance is no indicator of the future
pappupager wrote: Wed Sep 21, 2022 10:31 am I would like a counter that has been profitable over a long duration of time.
I think you need to pick a side.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by acegolfer »

pappupager wrote: Wed Sep 21, 2022 10:31 am I am 75-15-10 (VTI/VXUS/BND). Looking at VXUS specifically, the price has been the same in 2012 vs 2022, while during the same duration, VTI has quadrupled. No one has the crystal ball, and past performance is no indicator of the future, but why does everyone push heavily for VXUS as a counter for VTI? I would like a counter that has been profitable over a long duration of time.

Thoughts?
Since the correlation between VTI and VXUS is less than 1.00, and the 2 don't overlap, there will be positive diversification effect.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Triple digit golfer »

Because it is more diversified to hold VXUS in addition to VTI than just VTI. Holding one but not the other increases risk but not expected return.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by retired@50 »

VXUS has a compound annual growth rate of 5.08% since Feb. 2011 through Aug. 2022 according to Portfolio Visualizer.

Looking at share price alone ignores dividends. Don't ignore dividends.

Source: https://www.portfoliovisualizer.com/bac ... ion1_1=100

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pappupager
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Re: VXUS vs VTI -- why invest in VXUS?

Post by pappupager »

retired@50 wrote: Wed Sep 21, 2022 10:40 am VXUS has a compound annual growth rate of 5.08% since Feb. 2011 through Aug. 2022 according to Portfolio Visualizer.

Looking at share price alone ignores dividends. Don't ignore dividends.

Source: https://www.portfoliovisualizer.com/bac ... ion1_1=100

Regards,
Good point about dividends. Also love the visualizer tool!
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Re: VXUS vs VTI -- why invest in VXUS?

Post by ApeAttack »

OP, there are countless threads on US only vs US+international. Try searching for "US versus International", read some threads, and I'll bet your question will be answered.

You still may prefer US only, but the reasons why someone may want some international diversification will become clear.

I personally have about 75/25 US/ex-US for my stocks because it feels like a reasonable compromise between US only and market cap weight.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Robot Monster »

Small observation:

The US dollar has strengthened a lot since 2012, weighing down on international. Just look at Invesco DB US Dollar Index Bullish Fund (UUP)

https://finance.yahoo.com/quote/uup

On Jan 1st, 2012 it was at $22.12, and it's been increasing all these years since up to $29.74 at the moment.

BTW...

International has been talked about to death on this forum. I used to keep a list of the endless threads about it, link, but got tired of maintaining it.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by TomatoTomahto »

You may believe in “buy the haystack,” or you may believe in “only buy the US haystack.” Pick your poison, or perhaps pick another completely different poison. This topic is so tired and so am I.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Marseille07 »

pappupager wrote: Wed Sep 21, 2022 10:31 am I am 75-15-10 (VTI/VXUS/BND). Looking at VXUS specifically, the price has been the same in 2012 vs 2022, while during the same duration, VTI has quadrupled. No one has the crystal ball, and past performance is no indicator of the future, but why does everyone push heavily for VXUS as a counter for VTI? I would like a counter that has been profitable over a long duration of time.

Thoughts?
Places like Vanguard have to sell international to some degree. Imagine the uproar if they come out and say "we don't recommend international, please invest US-only, don't buy our product VXUS." They obviously can't say that.

As an individual investor, however, you get to decide what you want to do for your portfolio.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by dbr »

pappupager wrote: Wed Sep 21, 2022 10:31 am I am 75-15-10 (VTI/VXUS/BND). Looking at VXUS specifically, the price has been the same in 2012 vs 2022, while during the same duration, VTI has quadrupled. No one has the crystal ball, and past performance is no indicator of the future, but why does everyone push heavily for VXUS as a counter for VTI? I would like a counter that has been profitable over a long duration of time.

Thoughts?
Go to https://www.google.com/search?sitesearc ... nal+stocks and start reading.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Varsh »

How about VT and take it from there on the equity side? One fund and add your bond percentage to taste?
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Beensabu »

pappupager wrote: Wed Sep 21, 2022 10:31 am I would like a counter that has been profitable over a long duration of time.
Like what?
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Re: VXUS vs VTI -- why invest in VXUS?

Post by HMSVictory »

I don't drive looking through the rear view mirror and you shouldn't either. Todays "laggards" are tomorrows "winners".

There is diversification benefit to adding VXUS to VTI. VXUS yields 3%+ and has tax benefits.
Stay the course!
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Marseille07 »

HMSVictory wrote: Wed Sep 21, 2022 11:46 am Todays "laggards" are tomorrows "winners".
https://en.wikipedia.org/wiki/Gambler%27s_fallacy
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Re: VXUS vs VTI -- why invest in VXUS?

Post by BitTooAggressive »

Adding VXUS and VSS would add a vast number of companies to your portfolio that you don’t currently own.

Sure you can exclude international because of recent performance.

Why not exclude US value because of recent performance and US small cap?

Instead of VTI why not pick a US large growth fund and exclude the less productive US market segments, at least recently?

Where you draw your line is a bit arbitrary. I am about 40% International with 70% of international VXUS and 30% VSS.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by lostdog »

I wouldn't want to miss out on these top holdings in VXUS:

Taiwan Semiconductor Manufacturing Co. Ltd.
Nestle SA
Tencent Holdings Ltd.
Roche Holding AG
Samsung Electronics Co. Ltd.
Toyota Motor Corp.
Alibaba Group Holding Ltd.
Last edited by lostdog on Wed Sep 21, 2022 12:10 pm, edited 2 times in total.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by strummer6969 »

"I'm disappointed that the rest of the world didn't artificially inflate when the U.S. went though its biggest monetary and fiscal expansion in history."
Last edited by strummer6969 on Wed Sep 21, 2022 12:15 pm, edited 1 time in total.
manuvns
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Re: VXUS vs VTI -- why invest in VXUS?

Post by manuvns »

because VXUS include high growth and highly profitable companies outside of US
Thanks!
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Lawrence of Suburbia »

I'd be in international simply because it's at least a possibility that the U.S. run as #1 dominant economic/military power may be ending.

I've currently got about 8% of my portfolio in international -- I need to add some more. Will probably shift my Schwab dividend ETF (SCHD) into VT in the near future, which makes my whole portfolio look a lot more diversified in Portfolio Visualizer.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by the_wiki »

HMSVictory wrote: Wed Sep 21, 2022 11:46 am I don't drive looking through the rear view mirror and you shouldn't either. Todays "laggards" are tomorrows "winners".
A lot of today's laggards are also tomorrow's bankrupties.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Beensabu »

My gosh, that red line is as vertical as vertical as can be...
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Marseille07 »

Beensabu wrote: Wed Sep 21, 2022 1:05 pm My gosh, that red line is as vertical as vertical as can be...
The FOMC rates decision. 75 bps it is. Stay alert, the press conference coming up.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by nisiprius »

First, never look at price, always look at total return. The percentage return you get, and the percentage return shown in mutual fund literature, on Morningstar, etc. is total return, and charted on a "growth of $10,000 chart."

Price charts are primarily useful for short-term traders, and price charts were established by custom before the computer era when price was what was reported by the exchange, and total return needed to be researched to include dividends.

Second, whatever can or cannot be said about "the long run," for periods of time of ten years or less, the warning about past performance not being an indicator of future results is true. Financial assets experience ups and downs that persist for five, ten, or fifteen years or so... and then change. What is typically found in arguments e.g. about VXUS versus VTI is that the two competing assets, over long periods of time, play leapfrog... and it is very rare to have enough data to be very sure of anything.

Over the period of time in which Vanguard has offered an international stock index fund, there was a long period when it did about the same as the US, then a long period when it did quite a lot better, and now we are in a long period when it is doing worse. It's all a big shrug.

I personally believe that there are fairly good reasons to hold some international stocks, but I also believe what John C. Bogle said, which was that you don't need to invest in international stocks, but if you want to, fine, but don't invest more than 20% of your stocks internationally. My own feeling is that stocks are stocks and there isn't much reason to expect international stocks to be different, and that you get some uncompensated risk because of currency fluctuations when you buy financial assets that are not denominated in your home currency. This is one of the perennial topics of intense debate in the forum, be warned, and the debate is strangely intense, much more intense than I think it should be.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by visualguy »

nisiprius wrote: Wed Sep 21, 2022 1:33 pm Over the period of time in which Vanguard has offered an international stock index fund, there was a long period when it did about the same as the US, then a long period when it did quite a lot better, and now we are in a long period when it is doing worse. It's all a big shrug.
A big shrug??? The difference in performance has been huge over that period (1986-2022). The CAGR for US has been 10.14%, and for ex-US it has been 5.36%. This means that $10,000 grew to $326,699 with US, and $65,696 with ex-US over that period. That's a big chasm, not a big shrug.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by vineviz »

visualguy wrote: Wed Sep 21, 2022 8:06 pm
nisiprius wrote: Wed Sep 21, 2022 1:33 pm Over the period of time in which Vanguard has offered an international stock index fund, there was a long period when it did about the same as the US, then a long period when it did quite a lot better, and now we are in a long period when it is doing worse. It's all a big shrug.
A big shrug??? The difference in performance has been huge over that period (1986-2022). The CAGR for US has been 10.14%, and for ex-US it has been 5.36%. This means that $10,000 grew to $326,699 with US, and $65,696 with ex-US over that period. That's a big chasm, not a big shrug.
The point is that this is what diversification looks like.

This isn't Lake Wobegon: the funds can't all outperform at the same time.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch
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Re: VXUS vs VTI -- why invest in VXUS?

Post by abuss368 »

lostdog wrote: Wed Sep 21, 2022 12:10 pm I wouldn't want to miss out on these top holdings in VXUS:

Taiwan Semiconductor Manufacturing Co. Ltd.
Nestle SA
Tencent Holdings Ltd.
Roche Holding AG
Samsung Electronics Co. Ltd.
Toyota Motor Corp.
Alibaba Group Holding Ltd.
Hi lostdog -

Did you pull the trigger on investing in international? I thought you were Vanguard Balanced Index Index?

Best.
Tony
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Re: VXUS vs VTI -- why invest in VXUS?

Post by abuss368 »

pappupager wrote: Wed Sep 21, 2022 10:31 am I am 75-15-10 (VTI/VXUS/BND). Looking at VXUS specifically, the price has been the same in 2012 vs 2022, while during the same duration, VTI has quadrupled. No one has the crystal ball, and past performance is no indicator of the future, but why does everyone push heavily for VXUS as a counter for VTI? I would like a counter that has been profitable over a long duration of time.

Thoughts?
Fortunately this is diversification and the moving parts of different asset classes. The markets could just as easily have International out performing US (as it did previously).

No one know nuttin!

The best strategy is to own a few low cost and diversified total market index funds that you can stay the course with.

Best.
Tony
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arcticpineapplecorp.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by arcticpineapplecorp. »

would you really be saying this if it were 1972, 1979, 1989 or 2008:

Image

how about because I don't/can't know more than the global stock market, so why am I trying:

Image

read this:

viewtopic.php?f=10&t=253686

Image

the efficient frontier in the past was holding 30% international:

Image

Image

some other things to read:

https://corporate.vanguard.com/content/ ... Online.pdf

viewtopic.php?p=6409018#p6409018

viewtopic.php?p=6330800#p6330800

https://static1.squarespace.com/static/ ... +World.pdf

viewtopic.php?p=5340551#p5340551
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Re: VXUS vs VTI -- why invest in VXUS?

Post by visualguy »

vineviz wrote: Wed Sep 21, 2022 8:17 pm
visualguy wrote: Wed Sep 21, 2022 8:06 pm
nisiprius wrote: Wed Sep 21, 2022 1:33 pm Over the period of time in which Vanguard has offered an international stock index fund, there was a long period when it did about the same as the US, then a long period when it did quite a lot better, and now we are in a long period when it is doing worse. It's all a big shrug.
A big shrug??? The difference in performance has been huge over that period (1986-2022). The CAGR for US has been 10.14%, and for ex-US it has been 5.36%. This means that $10,000 grew to $326,699 with US, and $65,696 with ex-US over that period. That's a big chasm, not a big shrug.
The point is that this is what diversification looks like.

This isn't Lake Wobegon: the funds can't all outperform at the same time.
Sorry, looks like very serious diworsification to me.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by vineviz »

visualguy wrote: Wed Sep 21, 2022 8:39 pm
vineviz wrote: Wed Sep 21, 2022 8:17 pm
visualguy wrote: Wed Sep 21, 2022 8:06 pm
nisiprius wrote: Wed Sep 21, 2022 1:33 pm Over the period of time in which Vanguard has offered an international stock index fund, there was a long period when it did about the same as the US, then a long period when it did quite a lot better, and now we are in a long period when it is doing worse. It's all a big shrug.
A big shrug??? The difference in performance has been huge over that period (1986-2022). The CAGR for US has been 10.14%, and for ex-US it has been 5.36%. This means that $10,000 grew to $326,699 with US, and $65,696 with ex-US over that period. That's a big chasm, not a big shrug.
The point is that this is what diversification looks like.

This isn't Lake Wobegon: the funds can't all outperform at the same time.
Sorry, looks like very serious diworsification to me.
"Diworsification" is a term invented by performance chasers.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch
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Re: VXUS vs VTI -- why invest in VXUS?

Post by abuss368 »

vineviz wrote: Wed Sep 21, 2022 8:41 pm
visualguy wrote: Wed Sep 21, 2022 8:39 pm
vineviz wrote: Wed Sep 21, 2022 8:17 pm
visualguy wrote: Wed Sep 21, 2022 8:06 pm
nisiprius wrote: Wed Sep 21, 2022 1:33 pm Over the period of time in which Vanguard has offered an international stock index fund, there was a long period when it did about the same as the US, then a long period when it did quite a lot better, and now we are in a long period when it is doing worse. It's all a big shrug.
A big shrug??? The difference in performance has been huge over that period (1986-2022). The CAGR for US has been 10.14%, and for ex-US it has been 5.36%. This means that $10,000 grew to $326,699 with US, and $65,696 with ex-US over that period. That's a big chasm, not a big shrug.
The point is that this is what diversification looks like.

This isn't Lake Wobegon: the funds can't all outperform at the same time.
Sorry, looks like very serious diworsification to me.
"Diworsification" is a term invented by performance chasers.
I had never heard of that term until seeing it here on the forum for the first time many years ago!

Best.
Tony
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Re: VXUS vs VTI -- why invest in VXUS?

Post by abuss368 »

arcticpineapplecorp. wrote: Wed Sep 21, 2022 8:28 pm would you really be saying this if it were 1972, 1979, 1989 or 2008:

Image

how about because I don't/can't know more than the global stock market, so why am I trying:

Image

read this:

viewtopic.php?f=10&t=253686

Image

the efficient frontier in the past was holding 30% international:

Image

Image

some other things to read:

https://corporate.vanguard.com/content/ ... Online.pdf

viewtopic.php?p=6409018#p6409018

viewtopic.php?p=6330800#p6330800

https://static1.squarespace.com/static/ ... +World.pdf

viewtopic.php?p=5340551#p5340551
Wow! This graphs paint a very unique performance picture. A picture is worth a lot!

Thank you for sharing that.
Tony
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Re: VXUS vs VTI -- why invest in VXUS?

Post by JoMoney »

acegolfer wrote: Wed Sep 21, 2022 10:35 am ... Since the correlation between VTI and VXUS is less than 1.00, and the 2 don't overlap, there will be positive diversification effect.
There's no guarantee that that the correlations won't be the same, it was pretty close to 1 (.90) over the decade 2008-2017

...and depending on what is meant by "diversification effect", it should be noted that rebalancing between assets can cause the portfolio to have a higher standard deviation, and lower return, then if the portfolio had just been left alone (not rebalanced). Holding different assets means you don't have all the risk, nor the all the gains, of either asset alone, but the portfolio effect from rebalancing isn't always positive.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by lostdog »

abuss368 wrote: Wed Sep 21, 2022 8:20 pm
lostdog wrote: Wed Sep 21, 2022 12:10 pm I wouldn't want to miss out on these top holdings in VXUS:

Taiwan Semiconductor Manufacturing Co. Ltd.
Nestle SA
Tencent Holdings Ltd.
Roche Holding AG
Samsung Electronics Co. Ltd.
Toyota Motor Corp.
Alibaba Group Holding Ltd.
Hi lostdog -

Did you pull the trigger on investing in international? I thought you were Vanguard Balanced Index Index?

Best.
Tony
I was Balanced Index Fund many years ago. I pulled the trigger into international years ago and this is the way.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by strummer6969 »

vineviz wrote: Wed Sep 21, 2022 8:41 pm
visualguy wrote: Wed Sep 21, 2022 8:39 pm
vineviz wrote: Wed Sep 21, 2022 8:17 pm
visualguy wrote: Wed Sep 21, 2022 8:06 pm
nisiprius wrote: Wed Sep 21, 2022 1:33 pm Over the period of time in which Vanguard has offered an international stock index fund, there was a long period when it did about the same as the US, then a long period when it did quite a lot better, and now we are in a long period when it is doing worse. It's all a big shrug.
A big shrug??? The difference in performance has been huge over that period (1986-2022). The CAGR for US has been 10.14%, and for ex-US it has been 5.36%. This means that $10,000 grew to $326,699 with US, and $65,696 with ex-US over that period. That's a big chasm, not a big shrug.
The point is that this is what diversification looks like.

This isn't Lake Wobegon: the funds can't all outperform at the same time.
Sorry, looks like very serious diworsification to me.
"Diworsification" is a term invented by performance chasers.
Right. If all your investments are going up at the same time, that's not diversification. It has its place in a lifetime of regular investment. Some will not be able to see the big picture.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by visualguy »

strummer6969 wrote: Wed Sep 21, 2022 9:29 pm
vineviz wrote: Wed Sep 21, 2022 8:41 pm
visualguy wrote: Wed Sep 21, 2022 8:39 pm
vineviz wrote: Wed Sep 21, 2022 8:17 pm
visualguy wrote: Wed Sep 21, 2022 8:06 pm

A big shrug??? The difference in performance has been huge over that period (1986-2022). The CAGR for US has been 10.14%, and for ex-US it has been 5.36%. This means that $10,000 grew to $326,699 with US, and $65,696 with ex-US over that period. That's a big chasm, not a big shrug.
The point is that this is what diversification looks like.

This isn't Lake Wobegon: the funds can't all outperform at the same time.
Sorry, looks like very serious diworsification to me.
"Diworsification" is a term invented by performance chasers.
Right. If all your investments are going up at the same time, that's not diversification. It has its place in a lifetime of regular investment. Some will not be able to see the big picture.
120 years is more than long-enough to paint a mighty big picture.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by abuss368 »

lostdog wrote: Wed Sep 21, 2022 9:19 pm
abuss368 wrote: Wed Sep 21, 2022 8:20 pm
lostdog wrote: Wed Sep 21, 2022 12:10 pm I wouldn't want to miss out on these top holdings in VXUS:

Taiwan Semiconductor Manufacturing Co. Ltd.
Nestle SA
Tencent Holdings Ltd.
Roche Holding AG
Samsung Electronics Co. Ltd.
Toyota Motor Corp.
Alibaba Group Holding Ltd.
Hi lostdog -

Did you pull the trigger on investing in international? I thought you were Vanguard Balanced Index Index?

Best.
Tony
I was Balanced Index Fund many years ago. I pulled the trigger into international years ago and this is the way.
Hi lostdog.

Thanks for clarifying. Some international funds are yielding more than a bond fund!

Best.
Tony
John C. Bogle: “Simplicity is the master key to financial success."
strummer6969
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Re: VXUS vs VTI -- why invest in VXUS?

Post by strummer6969 »

visualguy wrote: Wed Sep 21, 2022 9:34 pm
strummer6969 wrote: Wed Sep 21, 2022 9:29 pm
vineviz wrote: Wed Sep 21, 2022 8:41 pm
visualguy wrote: Wed Sep 21, 2022 8:39 pm
vineviz wrote: Wed Sep 21, 2022 8:17 pm

The point is that this is what diversification looks like.

This isn't Lake Wobegon: the funds can't all outperform at the same time.
Sorry, looks like very serious diworsification to me.
"Diworsification" is a term invented by performance chasers.
Right. If all your investments are going up at the same time, that's not diversification. It has its place in a lifetime of regular investment. Some will not be able to see the big picture.
120 years is more than long-enough to paint a mighty big picture.
Having the reserve currency is a major privilege. I cannot be 100% confident that this power will not erode over time. I'm sure the British thought their empire would never end.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by visualguy »

strummer6969 wrote: Wed Sep 21, 2022 9:45 pm
visualguy wrote: Wed Sep 21, 2022 9:34 pm
strummer6969 wrote: Wed Sep 21, 2022 9:29 pm
vineviz wrote: Wed Sep 21, 2022 8:41 pm
visualguy wrote: Wed Sep 21, 2022 8:39 pm

Sorry, looks like very serious diworsification to me.
"Diworsification" is a term invented by performance chasers.
Right. If all your investments are going up at the same time, that's not diversification. It has its place in a lifetime of regular investment. Some will not be able to see the big picture.
120 years is more than long-enough to paint a mighty big picture.
Having the reserve currency is a major privilege. I cannot be 100% confident that this power will not erode over time. I'm sure the British thought their empire would never end.
TINOE - There Is No Other Empire for us to invest in. Well, there's China, but the investment part is, shall we say, a little bit problematic there. We're stuck with the world we have for the rest of our lives at least.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by vineviz »

visualguy wrote: Wed Sep 21, 2022 9:34 pm 120 years is more than long-enough to paint a mighty big picture.
But obviously some people just see what they want to see.

Which is fine, but I prefer to rely on evidence instead of emotion when I can.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch
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Re: VXUS vs VTI -- why invest in VXUS?

Post by strummer6969 »

visualguy wrote: Wed Sep 21, 2022 10:05 pm
strummer6969 wrote: Wed Sep 21, 2022 9:45 pm
visualguy wrote: Wed Sep 21, 2022 9:34 pm
strummer6969 wrote: Wed Sep 21, 2022 9:29 pm
vineviz wrote: Wed Sep 21, 2022 8:41 pm

"Diworsification" is a term invented by performance chasers.
Right. If all your investments are going up at the same time, that's not diversification. It has its place in a lifetime of regular investment. Some will not be able to see the big picture.
120 years is more than long-enough to paint a mighty big picture.
Having the reserve currency is a major privilege. I cannot be 100% confident that this power will not erode over time. I'm sure the British thought their empire would never end.
TINOE - There Is No Other Empire for us to invest in. Well, there's China, but the investment part is, shall we say, a little bit problematic there. We're stuck with the world we have for the rest of our lives at least.
That sounds similar to TINA - There is No Alternative. People kept saying that last year about stocks. Well, we know how that one turns out. There is no alternative until there is. Sure you can allocate to international when that happens. But then you don't know if that alternative is temporary so you continue with your original allocation. I'm going to skip the guessing game.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Marseille07 »

strummer6969 wrote: Wed Sep 21, 2022 10:25 pm That sounds similar to TINA - There is No Alternative. People kept saying that last year about stocks. Well, we know how that one turns out. There is no alternative until there is. Sure you can allocate to international when that happens. But then you don't know if that alternative is temporary so you continue with your original allocation. I'm going to skip the guessing game.
No, it doesn't sound similar to TINA. TINA means other assets look unattractive (low yields) so we'd have to buy stocks. It doesn't apply at all when we're talking about US vs ex-US.
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strummer6969
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Re: VXUS vs VTI -- why invest in VXUS?

Post by strummer6969 »

Marseille07 wrote: Wed Sep 21, 2022 10:34 pm
strummer6969 wrote: Wed Sep 21, 2022 10:25 pm That sounds similar to TINA - There is No Alternative. People kept saying that last year about stocks. Well, we know how that one turns out. There is no alternative until there is. Sure you can allocate to international when that happens. But then you don't know if that alternative is temporary so you continue with your original allocation. I'm going to skip the guessing game.
No, it doesn't sound similar to TINA. TINA means other assets look unattractive (low yields) so we'd have to buy stocks. It doesn't apply at all when we're talking about US vs ex-US.
Right. The point is that "there is no alternative " is a short sighted view. There is no alternative at the time. If you allocated 100% to stocks or 100% U.S. when you couldn't see an alternative, I don't know what to say, other than it is a failure of the imagination.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Marseille07 »

strummer6969 wrote: Wed Sep 21, 2022 10:45 pm Right. The point is that "there is no alternative " is a short sighted view. There is no alternative at the time. If you allocated 100% to stocks or 100% U.S. when you couldn't see an alternative, I don't know what to say, other than it is a failure of the imagination.
Actually we couldn't see alternatives. When the FF rate was 0% until March 2022, where do you put your money? Bonds would've sucked, cash wasn't great...thus everyone bought stocks. This was TINA in a nutshell, not lacking imagination.

Only recently people started talking about money-market funds.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by whodidntante »

I wonder what Tina Turner is doing right now?
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Re: VXUS vs VTI -- why invest in VXUS?

Post by strummer6969 »

Marseille07 wrote: Wed Sep 21, 2022 10:50 pm
strummer6969 wrote: Wed Sep 21, 2022 10:45 pm Right. The point is that "there is no alternative " is a short sighted view. There is no alternative at the time. If you allocated 100% to stocks or 100% U.S. when you couldn't see an alternative, I don't know what to say, other than it is a failure of the imagination.
Actually we couldn't see alternatives. When the FF rate was 0% until March 2022, where do you put your money? Bonds would've sucked, cash wasn't great...thus everyone bought stocks. This was TINA in a nutshell, not lacking imagination.
Building up cash, no bonds. 60/40 stocks/cash. I've always been a little wary of the MMT experiment. I never thought that helicopter dropping all that money would end up going well. Plus they had to unwind the balance sheet and get out of 0% FF at some point right.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by Marseille07 »

strummer6969 wrote: Wed Sep 21, 2022 10:56 pm Building up cash, no bonds. 60/40 stocks/cash. I've always been a little wary of the MMT experiment. I never thought that helicopter dropping all that money would end up going well. Plus they had to unwind the balance sheet and get out of 0% FF at some point right.
You positioned yourself well then. Lots of cash bashers here, still bashing cash even today.
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strummer6969
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Re: VXUS vs VTI -- why invest in VXUS?

Post by strummer6969 »

Marseille07 wrote: Wed Sep 21, 2022 10:59 pm
strummer6969 wrote: Wed Sep 21, 2022 10:56 pm Building up cash, no bonds. 60/40 stocks/cash. I've always been a little wary of the MMT experiment. I never thought that helicopter dropping all that money would end up going well. Plus they had to unwind the balance sheet and get out of 0% FF at some point right.
You positioned yourself well then. Lots of cash bashers here, still bashing cash even today.
Yes, there's always a bashing when things underperform. Not to say that some of it is not deserved.
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Re: VXUS vs VTI -- why invest in VXUS?

Post by visualguy »

strummer6969 wrote: Wed Sep 21, 2022 10:25 pm That sounds similar to TINA - There is No Alternative. People kept saying that last year about stocks. Well, we know how that one turns out. There is no alternative until there is. Sure you can allocate to international when that happens. But then you don't know if that alternative is temporary so you continue with your original allocation. I'm going to skip the guessing game.
No need for guessing. The new empire of Atlantis or whatever it ends up being isn't coming in our lifetime. Empires don't suddenly materialize out of thin air. We're stuck with the countries we have, and no US alternative. Empire lifecycles are long, while human life is short. A future generation may see a different world, but not us. For our generation, do it the Bogle way - VTI and chill.
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