Vanguard 2020-2030 Returns Projection Table

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watchnerd
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Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

Taken from:

https://advisors.vanguard.com/iwe/pdf/FAVEMOSP.pdf

Equities
U.S. equities 3.5%–5.5%
U.S. growth 2.5%–4.5%
U.S. value 6.0%–8.0%
U.S. large-cap 3.5%–5.5%
U.S. small-cap 4.5%–6.5%
U.S. real estate investment trusts 2.5%–4.5%
Global equities ex-U.S. (unhedged) 6.5%–8.5%


Fixed income
U.S. bonds 2.0%–3.0%
U.S. Treasury bonds 1.5%–2.5%
U.S. credit bonds 2.5%–3.5%
U.S. high-yield corporate bonds 3.0%–4.0%
U.S. Treasury inflation-protected securities 1.0%–2.0%
U.S. cash 1.5%–2.5%
Global bonds ex-U.S. (hedged) 1.5%–2.5%


Note:

1. Cash looks decent in comparison to Treasury or Global bonds ex-US (hedged).

2. ex-US DM & EM seem to be lumped together

3. US large cap / TSM looks 'meh'


I average these with JP Morgan and Blackrock numbers for return projection modeling for next 10 years.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by midareff »

LIke most guesses, some will be right, some not.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by bryanm »

Note that these are projected nominal returns, not real.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

bryanm wrote: Fri Feb 21, 2020 11:16 am Note that these are projected nominal returns, not real.
Correct.

The PDF has them forecasting inflation <2%.
Last edited by watchnerd on Fri Feb 21, 2020 11:23 am, edited 1 time in total.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Starfox »

I keep 18 months of near-term spending in cash. Our portfolio excluding this cash is 75% stocks, 25% bonds.
For near term spending, I like Vanguard Prime money market earning 1.61% SEC, compared to Vanguard Short-term Treasury Index earning 1.41% SEC.
I suppose I could split the difference and have it in Vanguard Treasury Money Market earning 1.52% SEC.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

Starfox wrote: Fri Feb 21, 2020 11:18 am I keep 18 months of near-term spending in cash. Our portfolio excluding this cash is 75% stocks, 25% bonds.
For near term spending, I like Vanguard Prime money market earning 1.61% SEC, compared to Vanguard Short-term Treasury Index earning 1.41% SEC.
I suppose I could split the difference and have it in Vanguard Treasury Money Market earning 1.52% SEC.
My short end is currently cash + short TIPS.

As I glide from 70/30 to 60/40, I may increase the cash portion.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by DB2 »

U.S. Value not looking bad.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Doc »

Starfox wrote: Fri Feb 21, 2020 11:18 am I keep 18 months of near-term spending in cash. Our portfolio excluding this cash is 75% stocks, 25% bonds.
For near term spending, I like Vanguard Prime money market earning 1.61% SEC, compared to Vanguard Short-term Treasury Index earning 1.41% SEC.
I suppose I could split the difference and have it in Vanguard Treasury Money Market earning 1.52% SEC.
If you are not going to use your settlement fund:

Vanguard Ultra-Short-Term Bond Investor VUBFX SEC 1.93%
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

Doc wrote: Fri Feb 21, 2020 11:33 am
Starfox wrote: Fri Feb 21, 2020 11:18 am I keep 18 months of near-term spending in cash. Our portfolio excluding this cash is 75% stocks, 25% bonds.
For near term spending, I like Vanguard Prime money market earning 1.61% SEC, compared to Vanguard Short-term Treasury Index earning 1.41% SEC.
I suppose I could split the difference and have it in Vanguard Treasury Money Market earning 1.52% SEC.
If you are not going to use your settlement fund:

Vanguard Ultra-Short-Term Bond Investor VUBFX SEC 1.93%
I've looked at VUBFX several times, but haven't pulled the trigger because I'm not sure how it will do in a downturn given all the financials it holds and whether the 20 bps or so over Prime MM is worth that risk.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Coltrane75 »

watchnerd wrote: Fri Feb 21, 2020 11:18 am
bryanm wrote: Fri Feb 21, 2020 11:16 am Note that these are projected nominal returns, not real.
Correct.

The PDF has them forecasting inflation <2%.
That's interesting considering that inflation has been on a recent short term trend upward. I think its around 2.5(?).
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Starfox »

Doc wrote: Fri Feb 21, 2020 11:33 am
Starfox wrote: Fri Feb 21, 2020 11:18 am I keep 18 months of near-term spending in cash. Our portfolio excluding this cash is 75% stocks, 25% bonds.
For near term spending, I like Vanguard Prime money market earning 1.61% SEC, compared to Vanguard Short-term Treasury Index earning 1.41% SEC.
I suppose I could split the difference and have it in Vanguard Treasury Money Market earning 1.52% SEC.
If you are not going to use your settlement fund:

Vanguard Ultra-Short-Term Bond Investor VUBFX SEC 1.93%
I think for the 18 month near-term spending, it would be ideal to have a known amount of money and just earn interest. The price fluctuation looks high, its changed in price 1% this past year, compared to Vanguard Prime or Vanguard Treasury MM, which has no price change, yielding 1.52-1.62% SEC. The cash I would be disappointed if it went the other way, losing 1% in price right as I am about to spend it.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

Coltrane75 wrote: Fri Feb 21, 2020 11:37 am
watchnerd wrote: Fri Feb 21, 2020 11:18 am
bryanm wrote: Fri Feb 21, 2020 11:16 am Note that these are projected nominal returns, not real.
Correct.

The PDF has them forecasting inflation <2%.
That's interesting considering that inflation has been on a recent short term trend upward. I think its around 2.5(?).
2019 CPI ended at 1.76% for the year
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Re: Vanguard 2020-2030 Returns Projection Table

Post by aristotelian »

To put these forecasts in perspective, I went back and looked at all of Vanguard's projections I could find going back to 2014. Basically they have forecasted below average returns and recommended caution/stay the course every year since 2014, and probably before that. 2020 is just the latest example. Their projections are always vague enough that they can never be wrong but also never particularly helpful either. I do follow the advice to stay the course, but would have done so regardless of their projection.

2020
Policy uncertainty constraining economic growth. No end in sight to low inflation.
Modest upgrade in equity valuation but elevated risk of drawdown. Return outlook much lower than previous years.

2019
Concerns are growing recession may be imminent. Slowdown led by US and China is most likely outcome. Long term outlook “guarded”.

2018
Modest growth and low inflation here to stay but risks increasing. Elevated downside risks. Recommend staying the course.

2017
Modest growth outlook. More challenging than previous 5 years.

2016
Global growth will remain frustratingly fragile. US economy unlikely to accelerate but will maintain expansion. Most guarded since 2006.

2015
Continued recovery supported by low interest rates. Volatility combined with resiliency.Below average returns over next 10 years, 3-5% real

2014
Pickup in global growth, low risk of inflation. Expect below average global equity returns. Uneasy about signs of froth. Balanced portfolio returns expected below average, 3-5% real, but principles of portfolio construction remain unchanged.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by rascott »

aristotelian wrote: Fri Feb 21, 2020 11:50 am To put these forecasts in perspective, I went back and looked at all of Vanguard's projections I could find going back to 2014. Basically they have forecasted below average returns and recommended caution/stay the course every year since 2014, and probably before that. 2020 is just the latest example. Their projections are always vague enough that they can never be wrong but also never particularly helpful either. I do follow the advice to stay the course, but would have done so regardless of their projection.

2020
Policy uncertainty constraining economic growth. No end in sight to low inflation.
Modest upgrade in equity valuation but elevated risk of drawdown. Return outlook much lower than previous years.

2019
Concerns are growing recession may be imminent. Slowdown led by US and China is most likely outcome. Long term outlook “guarded”.

2018
Modest growth and low inflation here to stay but risks increasing. Elevated downside risks. Recommend staying the course.

2017
Modest growth outlook. More challenging than previous 5 years.

2016
Global growth will remain frustratingly fragile. US economy unlikely to accelerate but will maintain expansion. Most guarded since 2006.

2015
Continued recovery supported by low interest rates. Volatility combined with resiliency.Below average returns over next 10 years, 3-5% real

2014
Pickup in global growth, low risk of inflation. Expect below average global equity returns. Uneasy about signs of froth. Balanced portfolio returns expected below average, 3-5% real, but principles of portfolio construction remain unchanged.

Ignored them then.... ignored them now. Totally worthless projections.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by TheDDC »

aristotelian wrote: Fri Feb 21, 2020 11:50 am To put these forecasts in perspective, I went back and looked at all of Vanguard's projections I could find going back to 2014. Basically they have forecasted below average returns and recommended caution/stay the course every year since 2014, and probably before that. 2020 is just the latest example. Their projections are always vague enough that they can never be wrong but also never particularly helpful either. I do follow the advice to stay the course, but would have done so regardless of their projection.

2020
Policy uncertainty constraining economic growth. No end in sight to low inflation.
Modest upgrade in equity valuation but elevated risk of drawdown. Return outlook much lower than previous years.

2019
Concerns are growing recession may be imminent. Slowdown led by US and China is most likely outcome. Long term outlook “guarded”.

2018
Modest growth and low inflation here to stay but risks increasing. Elevated downside risks. Recommend staying the course.

2017
Modest growth outlook. More challenging than previous 5 years.

2016
Global growth will remain frustratingly fragile. US economy unlikely to accelerate but will maintain expansion. Most guarded since 2006.

2015
Continued recovery supported by low interest rates. Volatility combined with resiliency.Below average returns over next 10 years, 3-5% real

2014
Pickup in global growth, low risk of inflation. Expect below average global equity returns. Uneasy about signs of froth. Balanced portfolio returns expected below average, 3-5% real, but principles of portfolio construction remain unchanged.
As we suspected.

My “projection charts” show different results anyway. Because they’re about as worthless as Vanguard’s.

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Re: Vanguard 2020-2030 Returns Projection Table

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watchnerd wrote: Fri Feb 21, 2020 11:36 am I've looked at VUBFX several times, but haven't pulled the trigger because I'm not sure how it will do in a downturn given all the financials it holds and whether the 20 bps or so over Prime MM is worth that risk.
VUBFX vs. VMFXX (Federal MM)

Price:

Image

3 month rolling return:

Image

FWIW: T-Bills are at ~ 1.57% (annual) currently. Price is stable. https://www.treasury.gov/resource-cente ... data=yield
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Uncorrelated »

It's interesting to note that vanguard deliberately seems to hide their factor funds, but they also expect US SVC to outperform TSM by 3.5%. Pretty strong indication that vanguard believes the value premium to be alive for US.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Thesaints »

According to Vanguard's table a 70/30 allocation, with a 30% foreign stocks, would yield in real terms anywhere from 1.7% to 4.4% annual, which seems about right.
Of course, actual result 10 years from now could be different, but I'd be surprised if they will be substantially different.
Incidentally, at the lower end of results and ignoring volatility, which would make things worse, a 4% withdrawal rate would deplete a portfolio by about a quarter of its value.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by anil686 »

Not super actionable IMO. I think VG’s Joe Davis gave a good response to Rick Ferri in the Jan podcast when asked how he would use these projections:
A). If retiring in the next few years - it gives you an idea of what VG expects - obviously anything can happen
B). If retiring in 10 -15 years, it probably gives you an idea of what expected returns in particular asset classes could be while your are still accumulating
C) Retiring over 15 years, does not matter - stay the course - not actionable

Again, I am paraphrasing his responses but that was his opinion on these. So for those of us more than 15 years out, all of this stuff is not really material — continue with your plan....
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

anil686 wrote: Fri Feb 21, 2020 4:36 pm Not super actionable IMO. I think VG’s Joe Davis gave a good response to Rick Ferri in the Jan podcast when asked how he would use these projections:
A). If retiring in the next few years - it gives you an idea of what VG expects - obviously anything can happen
B). If retiring in 10 -15 years, it probably gives you an idea of what expected returns in particular asset classes could be while your are still accumulating
C) Retiring over 15 years, does not matter - stay the course - not actionable

Again, I am paraphrasing his responses but that was his opinion on these. So for those of us more than 15 years out, all of this stuff is not really material — continue with your plan....
I'm 5-7 years from RE.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Thesaints »

anil686 wrote: Fri Feb 21, 2020 4:36 pm Again, I am paraphrasing his responses but that was his opinion on these. So for those of us more than 15 years out, all of this stuff is not really material — continue with your plan....
Unless your plan was built on a 10% average return. In which case 10 years from now one would very likely find himself with a far smaller capital than planned and maybe have to postpone his 2040 retirement date.
Unless, of course, one takes notice of current forecasts and maybe increases savings, or something like that.
I'd say it is quite material and reassessing plans in the light of any new information never hurt anybody. Of course assuming that one can discern between new information and usual junk.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by dharrythomas »

When markets are high and interest rates are low, we should expect lower than average returns going forward. Though there have been some rough spots, investors have had the wind at their back for the last 40 years. Reversion to the mean happens whether we want it to or not. Stay the course, accept what the market gives you, don’t reach too far for yield.

The actionable part is to realize that you may need to adjust your savings rate or retirement date because future returns on a real basis will probably be lower than the historical average.

Good luck.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

dharrythomas wrote: Fri Feb 21, 2020 5:11 pm When markets are high and interest rates are low, we should expect lower than average returns going forward. Though there have been some rough spots, investors have had the wind at their back for the last 40 years. Reversion to the mean happens whether we want it to or not. Stay the course, accept what the market gives you, don’t reach too far for yield.

The actionable part is to realize that you may need to adjust your savings rate or retirement date because future returns on a real basis will probably be lower than the historical average.

Good luck.
Reaching for yield and staying the course isn't the danger, IMHO.

It's people not realizing they may have to save more than they think if returns are lower.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by TomCat96 »

What gives these numbers any sort of crediblity?
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Thesaints »

TomCat96 wrote: Fri Feb 21, 2020 6:56 pm What gives these numbers any sort of crediblity?
VCMM ?
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

TomCat96 wrote: Fri Feb 21, 2020 6:56 pm What gives these numbers any sort of crediblity?
Something of a consensus, actually, between Vanguard, JP Morgan, and Blackrock in their 2020 forecasts.

All predict lower returns over the next decade, all predict international developed and emerging markets to give higher returns than US TSM.

None of the above forecasts that predicts another 10 years of US stock TSM / large cap dominance, or developed market sovereign bonds returning anything beyond the 1-3% range (nominal).

They're all pretty consistent on these themes, with small variances on the percentages assigned.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Puretaxableindexer »

The same "experts" who predict future returns are the ones that missed the DotCom bust and the financial crisis in 2008.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Uncorrelated »

Puretaxableindexer wrote: Fri Feb 21, 2020 9:44 pm The same "experts" who predict future returns are the ones that missed the DotCom bust and the financial crisis in 2008.
Predicting short-term returns is a very different problem from predicting long term returns. Not saying these forecasts are accurate, but it would be a mistake to dismiss them just because the short term forecasts are known to be unreliable.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by north2016 »

These predictions are educated guesses at best and definitely not actionable.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by thelateinvestor43 »

So what would my FSKAX Total Market Index fund return according to these predictions?

How about my FXNAX Bond fund?

Thanks
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Re: Vanguard 2020-2030 Returns Projection Table

Post by thelateinvestor43 »

DB2 wrote: Fri Feb 21, 2020 11:29 am U.S. Value not looking bad.
What's a good US value Fidelity index fund?

Does that mean small or large value?

Should I ditch my Total Stock Market FSKAX? :shock:
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Re: Vanguard 2020-2030 Returns Projection Table

Post by vipertom1970 »

Good thing I only need 2% return to cover 1 year of expenses.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Forester »

TomCat96 wrote: Fri Feb 21, 2020 6:56 pm What gives these numbers any sort of crediblity?
Divergences between value & growth aka infotech & energy, spread between top decile price-to-sales etc etc, all reminiscent of 2000. Some measures as extreme, others not so.

So the 2020s resemble the 2000s but with a twist... perhaps US megacap goes sideways without a big bust and what is hated now (value, ex-US) doesn't have exciting returns yet still comfortably outperforms VOO, QQQ.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

north2016 wrote: Sat Feb 22, 2020 4:45 am These predictions are educated guesses at best and definitely not actionable.
They're actionable for me.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

thelateinvestor43 wrote: Sat Feb 22, 2020 5:10 am So what would my FSKAX Total Market Index fund return according to these predictions?

How about my FXNAX Bond fund?

Thanks
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Re: Vanguard 2020-2030 Returns Projection Table

Post by DB2 »

thelateinvestor43 wrote: Sat Feb 22, 2020 5:38 am
DB2 wrote: Fri Feb 21, 2020 11:29 am U.S. Value not looking bad.
What's a good US value Fidelity index fund?

Does that mean small or large value?

Should I ditch my Total Stock Market FSKAX? :shock:
At the end of the day no one knows what will happen, hence, I lean Total Market index.

But Growth has outperformed Value for around the last 15 years, so reversion to the mean is probably inevitable at some point (when? who knows).

One could always do Total Market and then do a tilt toward Value. Some people on the forum do that today.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by BogleBoogie »

These projections are a great reminder to starting investing early and often! :o
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Re: Vanguard 2020-2030 Returns Projection Table

Post by JoMoney »

BlackRock has a nice page with their expectations as well:
https://www.blackrock.com/institutions/ ... ssumptions
Most striking to me, was the bottom-end range for longer term bonds relative to everything else.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

JoMoney wrote: Sat Feb 22, 2020 10:33 am BlackRock has a nice page with their expectations as well:
https://www.blackrock.com/institutions/ ... ssumptions
Most striking to me, was the bottom-end range for longer term bonds relative to everything else.
Between Blackrock, JP Morgan, and Vanguard, the Blackrock projections skew a bit lower. This is why I average all 3 of them (not possible for all assets).

But the secular trends are the same between them:

--US stocks lower than in the past and underperforming international
--Bonds returning more or less 0 real return (maybe a hair positive, maybe a hair negative) above inflation

Blackrock is more bullish on EM bonds.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

DB2 wrote: Sat Feb 22, 2020 10:13 am
thelateinvestor43 wrote: Sat Feb 22, 2020 5:38 am
DB2 wrote: Fri Feb 21, 2020 11:29 am U.S. Value not looking bad.
What's a good US value Fidelity index fund?

Does that mean small or large value?

Should I ditch my Total Stock Market FSKAX? :shock:
At the end of the day no one knows what will happen, hence, I lean Total Market index.

But Growth has outperformed Value for around the last 15 years, so reversion to the mean is probably inevitable at some point (when? who knows).

One could always do Total Market and then do a tilt toward Value. Some people on the forum do that today.
My tilt towards value is international stock.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Grogs »

The thing is, even if their crystal ball is working perfectly and those 10-year return figures are spot on, the direction of the markets during those years can matter almost as much as the total return. If a chart of the next 10 years looks like a 'V' (i.e., a long steady decline followed by a long steady period of growth) an early accumulator could get fantastic returns during that period. For a retiree, that same 'V' shape would be terrible. A long period of slow steady growth or a pyramid shape would result in vastly different personal rates of return even if the total market returns over the 10 years were identical.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by thelateinvestor43 »

I've got the FSPGX Large Cap Growth Index fund in my Roth at Fidelity along with the Total Market. It's gotten 4.06% and FSKAX 6.47% so far and I've only had them now for a little over 3 months.

Is Large cap growth different from just plain Large cap?

Is U.S cash similar to Fidelity's money market funds?

Is Global equities emerging markets? or just international?

I noticed though that the Fidelity small cap value index is in the negative so far YTD. I guess small caps aren't doing good right now?
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Re: Vanguard 2020-2030 Returns Projection Table

Post by mbasherp »

At least the forecast seems to indicate my plan is a good one:

Hold as much equity as possible, maintain 1/3 international allocation, don’t pay extra on the mortgage. Keep accumulating. Check back in a decade or two.
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watchnerd
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

thelateinvestor43 wrote: Sat Feb 22, 2020 1:38 pm I've got the FSPGX Large Cap Growth Index fund in my Roth at Fidelity along with the Total Market. It's gotten 4.06% and FSKAX 6.47% so far and I've only had them now for a little over 3 months.

Is Large cap growth different from just plain Large cap?

Is U.S cash similar to Fidelity's money market funds?

Is Global equities emerging markets? or just international?

I noticed though that the Fidelity small cap value index is in the negative so far YTD. I guess small caps aren't doing good right now?

1. Large cap growth is a subset of "large cap", which is short hand for "large cap blend"

2. Yes, US cash = money market funds or similar, wherever

3. Global equities would be developed and emerging markets blended together

4. Whatever small cap value is doing now is a bit moot in the context of a 10 year forecast
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

mbasherp wrote: Sat Feb 22, 2020 1:58 pm At least the forecast seems to indicate my plan is a good one:

Hold as much equity as possible, maintain 1/3 international allocation, don’t pay extra on the mortgage. Keep accumulating. Check back in a decade or two.
I would question 1/3 international based on the forecast.

If you think the forecasts have any value, and that US will underperform international over the next decade, it begs the question why you're underweighting international compared to the global market cap.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by mbasherp »

watchnerd wrote: Sat Feb 22, 2020 2:00 pm
mbasherp wrote: Sat Feb 22, 2020 1:58 pm At least the forecast seems to indicate my plan is a good one:

Hold as much equity as possible, maintain 1/3 international allocation, don’t pay extra on the mortgage. Keep accumulating. Check back in a decade or two.
I would question 1/3 international based on the forecast.

If you think the forecasts have any value, and that US will underperform international over the next decade, it begs the question why you're underweighting international compared to the global market cap.
You’re correct. If I thought this forecast was a crystal ball, my plan wouldn’t be the best plan. It would remain a good one though. Combine that with the fact that I don’t believe anyone (even Vanguard) has a crystal ball, and I’m definitely comfortable with a “good enough” plan.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

mbasherp wrote: Sat Feb 22, 2020 2:09 pm
watchnerd wrote: Sat Feb 22, 2020 2:00 pm
mbasherp wrote: Sat Feb 22, 2020 1:58 pm At least the forecast seems to indicate my plan is a good one:

Hold as much equity as possible, maintain 1/3 international allocation, don’t pay extra on the mortgage. Keep accumulating. Check back in a decade or two.
I would question 1/3 international based on the forecast.

If you think the forecasts have any value, and that US will underperform international over the next decade, it begs the question why you're underweighting international compared to the global market cap.
You’re correct. If I thought this forecast was a crystal ball, my plan wouldn’t be the best plan. It would remain a good one though. Combine that with the fact that I don’t believe anyone (even Vanguard) has a crystal ball, and I’m definitely comfortable with a “good enough” plan.
I just got global market cap, that way I don't have to choose. ;)
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Re: Vanguard 2020-2030 Returns Projection Table

Post by mbasherp »

watchnerd wrote: Sat Feb 22, 2020 2:20 pm I just got global market cap, that way I don't have to choose. ;)
That is also a good plan!

Although, it is still a choice. :wink:
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Re: Vanguard 2020-2030 Returns Projection Table

Post by watchnerd »

mbasherp wrote: Sat Feb 22, 2020 2:31 pm
watchnerd wrote: Sat Feb 22, 2020 2:20 pm I just got global market cap, that way I don't have to choose. ;)
That is also a good plan!

Although, it is still a choice. :wink:
It's the passive choice.

Anything else is a tilt.
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Re: Vanguard 2020-2030 Returns Projection Table

Post by Hank Moody »

Puretaxableindexer wrote: Fri Feb 21, 2020 9:44 pm The same "experts" who predict future returns are the ones that missed the DotCom bust and the financial crisis in 2008.
These aren't predictions -- they're capital market expectations. They're not forecasting how to time the markets, but rather how asset classes are expected to perform, in nominal terms, over an extended period of time.
-HM
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