MoneyMarathon wrote: ↑Wed Jul 24, 2019 5:19 pm
JBeck wrote: ↑Sun Jul 21, 2019 6:41 pm
Curious as to if anyone has decided to change their asset allocation based on all the possible alternatives MoneyMarathon has provided
I've actually made my changes. Unlike others in this thread, I haven't started a play money or side bet account. I was able to buy PSLDX in the Roth IRAs at Vanguard and in my 401k by using a Schwab PCRA brokerage window. The fees were $20 x 2 at Vanguard and $49.95 x 1 at Schwab.
I decided that I really like PSLDX (S&P 500 and long-term treasury/corporate/other bonds) in tax-advantaged. Part of the reason I like it is behavioral. It generally hugs the S&P 500 index with some of what might be called "alpha" from using bonds, which is ideal for someone who tends to be happy when not underperforming the market. Another behavioral aspect is that there is no button-pushing. This is huge, we're not robots. I didn't even check the financial news at all in 2018 and didn't know there was a stock correction in December until this summer. Ignorance is bliss, I guess. Another reason is that it was easy to explain and get my spouse on board. Having it go through 2008, for real, and be basically fine is another selling point. Being at PIMCO instead of a tiny ETF provider is another selling point. Not having to wonder about optimal rebalancing strategies or forgetting to do it optimally could be considered a plus. Being able to focus more free time and energy on other, income-generating opportunities is a plus. Not having to worry about what would happen if someone inherited the account and left it alone is a plus.
I also decided that I didn't like PISIX, the international fund. They're a bit too active for my tastes on the bond side, whipping around their duration exposure based on manager decisions, I guess because they have no "secondary index" or duration target like PSLDX (that secondary index and duration target forces the PSLDX guys to be sort-of closet indexers at heart, which is good).
The other reason that I don't like PISIX is that PSLDX is too darn good. It takes up valuable tax-advantaged space that is better used by PSLDX, which throws off more income on the bond side. My goal is actually to have 100% of tax advantaged in PSLDX, while keeping international in taxable. I'm not there yet, need to build up my taxable account more. Currently I'm a a little over 80% of tax advantaged in PSLDX, the rest in the institutional version of VXUS (ex-US world equities). Over time, I'd like to shift to using IXUS in taxable (since it seems somewhat more tax-efficient than VXUS) for my international exposure.
Personal Capital says my allocation now looks like this:
13.95% International Bonds
77.7% US Bonds
17.44% International Stock
80.55% US Stock
3.34% Alternatives (Real Estate, etc.)
My paycheck 401k contributions (traditional and after-tax) are going to the international stock fund.
I can't get this fund (PSLDX) out of my head. Have been thinking about it for the last couple of weeks. And trying to figure out why I shouldn't put basically all my LC blend allocation into this fund (or as much as I can get into it).
Under what scenario will this thing greatly lag the SP500? Beyond inflation spikes.... which would be theoretically temporary? And in 'normal' world how could it not over-perform the index?
My only issue right now is that I can't buy it anywhere where I have funds. (TDA will do it for $0 min, but $50 fee, but I have only a tiny account there right now). Other than that... a small Roth at Ally that's my wife's (and has anyone actually confirmed Ally will do it for $10/$100 min?).
Dang, Merrill Edge....come on man. Closed.
I do have brokerage link through Fidelity for both our 401ks.... but think someone mentioned that didn't work either. This is one tough fund to get, lol.
How would one setup a similar position with ETFs? It's obviously not as leveraged as OP (which I'm still doing in a M1 Roth). I still believe futures are the best way to do this type of setup over LETFs...and I'd much rather the pros handle the futures than me.