Portfolio Visualizer

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
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houtx101
Posts: 1
Joined: Sun Jan 25, 2015 7:06 pm

Portfolio Visualizer

Post by houtx101 » Mon Jan 15, 2018 6:14 am

I recently found the portfolio visualizer through the forum and have been doing some assessments on the best mix of things for my portfolio. Of course a couple of scenarios have brought up some questions.
I did a comparison of a growth portfolio 52% VTSMX, 28% VGTSX, 16% VBMFX and 4% PIGlX compared to 100% VBLTX (Bonds) and 100% VTSMX (equities). For a long run, Jan 2001 to Dec 2017 the 100% bonds outperformed the other portfolios all the way through.
I have read that we have been on a bond bull run for years, but does this make sense or am I missing something?

https://www.portfoliovisualizer.com/bac ... sisResults

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GreatOdinsRaven
Posts: 531
Joined: Thu Apr 23, 2015 8:47 pm

Re: Portfolio Visualizer

Post by GreatOdinsRaven » Mon Jan 15, 2018 7:14 pm

houtx101 wrote:
Mon Jan 15, 2018 6:14 am
I recently found the portfolio visualizer through the forum and have been doing some assessments on the best mix of things for my portfolio. Of course a couple of scenarios have brought up some questions.
I did a comparison of a growth portfolio 52% VTSMX, 28% VGTSX, 16% VBMFX and 4% PIGlX compared to 100% VBLTX (Bonds) and 100% VTSMX (equities). For a long run, Jan 2001 to Dec 2017 the 100% bonds outperformed the other portfolios all the way through.
I have read that we have been on a bond bull run for years, but does this make sense or am I missing something?

https://www.portfoliovisualizer.com/bac ... sisResults
Your link doesn’t work because you didn’t click the icon labeled “link” under portfolio analysis results. Redo it. Click “link” and then cut and paste the link here, again.

GOR
"The greatest enemies of the equity investor are expenses and emotions." -John C. Bogle, Little Book of Common Sense Investing. | | "Winter is coming." Lord Eddard Stark.

venkman
Posts: 712
Joined: Tue Mar 14, 2017 10:33 pm

Re: Portfolio Visualizer

Post by venkman » Mon Jan 15, 2018 11:25 pm

houtx101 wrote:
Mon Jan 15, 2018 6:14 am
I did a comparison of a growth portfolio 52% VTSMX, 28% VGTSX, 16% VBMFX and 4% PIGlX compared to 100% VBLTX (Bonds) and 100% VTSMX (equities). For a long run, Jan 2001 to Dec 2017 the 100% bonds outperformed the other portfolios all the way through.
I have read that we have been on a bond bull run for years, but does this make sense or am I missing something?
No, it's right. It's just that your time period includes a bull market for bonds AND two big bear markets for stocks. If you start one year later, stocks pull ahead slightly. If you start two years later, stocks win by a mile.

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arcticpineapplecorp.
Posts: 3337
Joined: Tue Mar 06, 2012 9:22 pm

Re: Portfolio Visualizer

Post by arcticpineapplecorp. » Mon Jan 15, 2018 11:35 pm

welcome to the group.

Are you planning on investing for just 17 years and then never again? If not, then why do you care what the last 17 years did?

Do you think interest rates for bonds will repeat the same cylce as the last 17 years? If not, then what do the last 17 years of interst rates tell you about the next 17 years?

The past is not prologue. You can play with portfolio visualizer all day long (it is a great and fun and amazing and free tool, so I'm not downplaying it) and at the end of the day after you settle on what you think was the best portfolio over a certain period, you will still find other portfolios that could do better going forward.

Pick a portfolio, then read this article that shows 150 portfolios better than yours:

https://www.whitecoatinvestor.com/150-p ... han-yours/

don't let the perfect be the enemy of the good enough.

The most important decision in building your portfolio is the proportion of stocks to bonds. There is no perfect proportion between the two. Well, there might be, but there's no way to know that beforehand. So just pick an allocation of stocks to bonds that meets your need for growth and only has the amount of risk you have the need, ability and willingness to take, but no more. To get an idea of the differnt portfolio allocations read more here about the historical long term returns (back to 1926...a bit longer than back to 2001):

https://personal.vanguard.com/us/insigh ... llocations

Let us know what mix of stocks/bonds you decide. It's always interesting to hear how people make these decisions.
"Invest we must." -- Jack Bogle | “The purpose of investing is not to simply optimise returns and make yourself rich. The purpose is not to die poor.” -- William Bernstein

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