Lazy portfolio - calculations

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ejvyas
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Lazy portfolio - calculations

Post by ejvyas »

I have been a Boglehead for the last 6 yrs. One of the good things about this is I dont have to look at markets everyday or return to my calculations. But when I do look at my portfolio every few months I dont remember my calculations :oops:

I was updating my spreadsheet to manage my core 4 lazy portfolio: https://www.bogleheads.org/wiki/Lazy_po ... portfolios and I ran into an issue.
If I add FFKHX Fidelity Freedom K® 2050 Fund ER:0.64 in my account. I do morning star X-Ray on that http://portfolio.morningstar.com/Rtport ... Entry.aspx here is what I get

US Stocks 60%
Foreign Stocks 30%
Bonds 6%
Real Estate 2.81%
Cash 4%

Questions:
1. Do I use these values multiplied by the total money I am going to invest? Reason being the Real Estate might be already counted as the US Stocks or Foreign Stocks
2. Where do I account for the 4% Cash
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whatusername?
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Re: Lazy portfolio - calculations

Post by whatusername? »

You are 103% invested... you might want to do some more digging to get better numbers. That may give you a better idea of where the real estate is being counted. And cash is cash, though bonds (fixed income) is the most logical place to categorize it if you're trying to fit the 4 categories.
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ejvyas
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Re: Lazy portfolio - calculations

Post by ejvyas »

whatusername? wrote:You are 103% invested... you might want to do some more digging to get better numbers. That may give you a better idea of where the real estate is being counted. And cash is cash, though bonds (fixed income) is the most logical place to categorize it if you're trying to fit the 4 categories.
Hence the question :?

Real Estate will always be US or International. Should I decrease the US/Intl percentage according to which Real Estate it is ?
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whatusername?
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Re: Lazy portfolio - calculations

Post by whatusername? »

How can you tell which it is?
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whaleknives
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Re: Lazy portfolio - calculations

Post by whaleknives »

Rick Ferri's Core Four portfolio is made up of separate REIT, Total Stock Market Index, Total International Stock Index, and Total Bond index funds. He is aware, and you should be, that there is about 4% real estate in both the Total Stock and Total International Stock funds already. The separate REIT fund is intended to overweight real estate.

If you have to buy the target fund, you can ignore the % real estate and cash, and consider it part of the Total Stock, International, and Bond contributions. It's not a separate REIT fund.
"I'm an indexer. I own the market. And I'm happy." (John Bogle, "BusinessWeek", 8/17/07) ☕ Maritime signal flag W - Whiskey: "I require medical assistance."
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ejvyas
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Re: Lazy portfolio - calculations

Post by ejvyas »

ok so I can dissect some funds like S&P500 into US, Intl, Bonds but for REIT I just need to consider funds like VGSLX which are exclusively marked REIT
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whaleknives
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Re: Lazy portfolio - calculations

Post by whaleknives »

ejvyas wrote:ok so I can dissect some funds like S&P500 into US, Intl, Bonds but for REIT I just need to consider funds like VGSLX which are exclusively marked REIT
This works, but I think you're ignoring the lazy part of the Core Four. The S&P 500 is already in the Total Stock Index. There's no reason to track sectors in each of the 4 funds, only the allocations of the funds themselves.
"I'm an indexer. I own the market. And I'm happy." (John Bogle, "BusinessWeek", 8/17/07) ☕ Maritime signal flag W - Whiskey: "I require medical assistance."
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Re: Lazy portfolio - calculations

Post by ejvyas »

Thank you everyone. I have simplified my calculations. So just to clarify here is my classification now:

Total US Market
VTSAX Vanguard Total Stock Market Index Fund Admiral Shares
Dryden S&P500
FFKHX Fidelity Freedom K® 2050 Fund

All-World ex-US
VTIAX Vanguard Total International Stock Index Fund Admiral Shares
VTPSX Vanguard Total International Stock Index Fund Institutional Plus Shares

REIT
VGSLX Vanguard REIT Index Fund Admiral Shares

Bonds
VBMPX Vanguard Total Bond Market Index Fund Institutional Plus Shares
various CD

These are various different accounts - HSA, 401k, Roth IRA, Taxable etc. Looks ok?
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