A low-cost 5 fund Boglehead portfolio

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
User avatar
Topic Author
vineviz
Posts: 5077
Joined: Tue May 15, 2018 1:55 pm

A low-cost 5 fund Boglehead portfolio

Post by vineviz » Mon Jul 29, 2019 6:48 pm

I'm frequently asked, sometimes by private message, if it's possible to build a low-cost portfolio that is both consistent with the Bogleheads investment philosophy (e.g. simplicity, low-cost, broadly diversified, etc.) and makes use of advances in financial research that have taken place over the past forty years.

This is definitely possible.

In order to avoid potentially confusing people with the well-established 3 and 4 fund Boglehead portfolios, I thought it might be instructive to put forward an example 5 fund portfolio that ticks all the Bogleheads boxes. I know that others (e.g. Larry Swedroe and Rick Ferri ) have done this before, so nothing radically new here. Just a fresh discussion.

My goal was to keep expenses low (less than 0.10% if possible), rely on Vanguard-issued market-cap weighted index funds as much as possible, and to create a significantly more diversified portfolio than is possible using the the typical total market funds. As an example, this portfolio is 80% stocks and 20% bonds but could easily be made more or less conservative.

32.00% Vanguard Total Stock Market ETF (VTI)
16.00% Vanguard S&P Small-Cap 600 Value ETF (VIOV)
16.00% Vanguard FTSE All-Wld ex-US SmCp ETF (VSS)
16.00% Vanguard FTSE Emerging Markets ETF (VWO)
20.00% Vanguard Long-Term Bond ETF (BLV)

Some or all of these funds could be swapped out for funds from other issuers (though not all of equivalent portfolios are quite as cheap). For example:

32.00% iShares Core S&P Total US Stock Mkt ETF (ITOT)
16.00% iShares S&P Small-Cap 600 Value ETF (IJS)
16.00% iShares MSCI EAFE Small-Cap ETF (SCZ)
16.00% iShares Core MSCI Emerging Markets ETF (IEMG)
20.00% iShares Core 10+ Year USD Bond ETF (ILTB)

or

32.00% SPDR Portfolio Total Stock Market ETF (SPTM)
16.00% SPDR S&P 600 Small Cap Value ETF (SLYV)
16.00% SPDR S&P International Small Cap ETF (GWX)
16.00% SPDR Portfolio Emerging Markets ETF (SPEM)
20.00% SPDR Portfolio Long Term Treasury ETF (SPTL)

and so on.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

PackersFan12
Posts: 60
Joined: Fri Jan 05, 2018 7:40 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by PackersFan12 » Mon Jul 29, 2019 6:53 pm

Vineviz, can you construct something comparable using Vanguard mutual funds; not ETFs?

User avatar
Topic Author
vineviz
Posts: 5077
Joined: Tue May 15, 2018 1:55 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by vineviz » Mon Jul 29, 2019 7:04 pm

PackersFan12 wrote:
Mon Jul 29, 2019 6:53 pm
Vineviz, can you construct something comparable using Vanguard mutual funds; not ETFs?
Definitely. All but one of those ETFs has a direct retail mutual fund equivalent. Instead of VIOV you’d used the mutual fund equivalent of VBR. I can look these up later, when I’m at my computer.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

HawkeyePierce
Posts: 629
Joined: Tue Mar 05, 2019 10:29 pm
Location: Colorado

Re: A low-cost 5 fund Boglehead portfolio

Post by HawkeyePierce » Mon Jul 29, 2019 7:13 pm

The mutual fund equivalents are:

Vanguard Total Stock Market VTI == VTSAX (0.03% vs 0.04%)
Vanguard S&P Small-Cap 600 Value VIOV is not offered as a mutual fund. Vanguard offers VSIAX but it tracks a different index (CRSP US Small Cap Value Index)
Vanguard FTSE All-World ex-US Small-Cap VSS == VFSAX (0.12% vs. 0.16%)
Vanguard FTSE Emerging Markets VWO == VEMAX (0.12% vs 0.14%)
Vanguard Long-Term Bond BLV == VBLAX (0.07% vs 0.07% with a 0.5% purchase fee)

I've been moving somewhat in this direction, at least on the bond side. I recently split my bond holdings 50:50 between total US bond and long-term Treasuries. My investment horizon for those bond holdings is multiple decades so I'm comfortable leaning towards LTTs. If I ever manage to get back into TreasuryDirect I'll max out my annual I-Bond purchase as well.

megabad
Posts: 2363
Joined: Fri Jun 01, 2018 4:00 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by megabad » Mon Jul 29, 2019 7:45 pm

vineviz wrote:
Mon Jul 29, 2019 6:48 pm
I'm frequently asked, sometimes by private message, if it's possible to build a low-cost portfolio that is both consistent with the Bogleheads investment philosophy (e.g. simplicity, low-cost, broadly diversified, etc.) and makes use of advances in financial research that have taken place over the past forty years.

This is definitely possible.
Is the long term bond holding persistent in your portfolio? As in, suppose the core AA blend is 50/50 equities/fixed income and the time horizon is shorter--is the entire fixed income portion long term?

retiringwhen
Posts: 1286
Joined: Sat Jul 08, 2017 10:09 am
Location: New Jersey, USA

Re: A low-cost 5 fund Boglehead portfolio

Post by retiringwhen » Mon Jul 29, 2019 8:26 pm

What is the principle/observation that keeps Large Cap Developed Markets out of the portfolio? High correlation with US Stocks?

CJC000
Posts: 73
Joined: Sat Jul 09, 2016 11:41 am

Re: A low-cost 5 fund Boglehead portfolio

Post by CJC000 » Mon Jul 29, 2019 8:30 pm

We're all in at Schwab. Do you mind making a similar portfolio with their ETF"s??
Thanks!

stan1
Posts: 7315
Joined: Mon Oct 08, 2007 4:35 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by stan1 » Mon Jul 29, 2019 8:58 pm

CJC000 wrote:
Mon Jul 29, 2019 8:30 pm
We're all in at Schwab. Do you mind making a similar portfolio with their ETF"s??
Thanks!
VTI -> SCHB
VIOV -> SLYV [no commission ETF list]

VWO -> SCHE
VSS -> SCHC

bluquark
Posts: 680
Joined: Mon Oct 22, 2018 2:30 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by bluquark » Mon Jul 29, 2019 8:59 pm

retiringwhen wrote:
Mon Jul 29, 2019 8:26 pm
What is the principle/observation that keeps Large Cap Developed Markets out of the portfolio? High correlation with US Stocks?
Right, this is also what jumped out at me here. I doubt the theoretical financial literature supports the idea that an ideally diversified portfolio should hold 0% of the second-largest equity class. It seems to have been omitted because it's the world's most boring type of equity and the portfolio needed "space" for the strong tilts to small and emerging, given the self-imposed restriction of neat 16% slices.

I was first going to suggest replacing Total US Stock with Total World Stock, but that winds up creating a weird anti-home-biased portfolio. So I would suggest instead replacing the 16% ex-US Small Cap with 16% ex-US Developed. Then, the Small tilt is probably weaker than Vineviz would like, but it's more important that the portfolio doesn't sacrifice traditional diversification (which the research has never undermined per se) in trying to go hard for fancy factor diversification.

Tedd
Posts: 17
Joined: Sat Jan 05, 2019 5:18 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by Tedd » Mon Jul 29, 2019 9:08 pm

vineviz wrote:
Mon Jul 29, 2019 6:48 pm

32.00% Vanguard Total Stock Market ETF (VTI)
16.00% Vanguard S&P Small-Cap 600 Value ETF (VIOV)
16.00% Vanguard FTSE All-Wld ex-US SmCp ETF (VSS)
16.00% Vanguard FTSE Emerging Markets ETF (VWO)
20.00% Vanguard Long-Term Bond ETF (BLV)
Why use long term bonds?

retiringwhen
Posts: 1286
Joined: Sat Jul 08, 2017 10:09 am
Location: New Jersey, USA

Re: A low-cost 5 fund Boglehead portfolio

Post by retiringwhen » Mon Jul 29, 2019 9:18 pm

bluquark wrote:
Mon Jul 29, 2019 8:59 pm
So I would suggest instead replacing the 16% ex-US Small Cap with 16% ex-US Developed.
Ironically, One of the things that attracts me to this portfolio is the avoidance of Developed Markets. Sort of like Global Bond funds, I don't see the need to hold alot of them just for completion sake. A quick look at Portfolio Visualizer hints at confirmation of the idea that Developed Markets are much more highly correlated with US Markets than either Emerging or the ex-US Small Cap.

bluquark
Posts: 680
Joined: Mon Oct 22, 2018 2:30 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by bluquark » Mon Jul 29, 2019 9:26 pm

retiringwhen wrote:
Mon Jul 29, 2019 9:18 pm
bluquark wrote:
Mon Jul 29, 2019 8:59 pm
So I would suggest instead replacing the 16% ex-US Small Cap with 16% ex-US Developed.
Ironically, One of the things that attracts me to this portfolio is the avoidance of Developed Markets. Sort of like Global Bond funds, I don't see the need to hold alot of them just for completion sake. A quick look at Portfolio Visualizer hints at confirmation of the idea that Developed Markets are much more highly correlated with US Markets than either Emerging or the ex-US Small Cap.
Looking at portfolio visualizer also shows their returns have been about 4x lower than the US over the last decade. Quite a coincidence that at the very same time that the simple investor on the street decides to avoid this asset class after naively looking at past returns, portfolios entirely based on sophisticated "financial research" also just so happen to omit it (to be fair, in favor of some other intl classes with equally lackluster recent performance)

If developed ex-US large cap can return 4x lower than the US over a decade timeframe, then it's well within the realm of possibility that it returns 4x higher than the US over a future decade. It's essential to have it in any portfolio.
Last edited by bluquark on Mon Jul 29, 2019 9:47 pm, edited 1 time in total.

User avatar
Topic Author
vineviz
Posts: 5077
Joined: Tue May 15, 2018 1:55 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by vineviz » Mon Jul 29, 2019 9:27 pm

megabad wrote:
Mon Jul 29, 2019 7:45 pm
Is the long term bond holding persistent in your portfolio? As in, suppose the core AA blend is 50/50 equities/fixed income and the time horizon is shorter--is the entire fixed income portion long term?
The fund I used in this example (ILTB) has an average effective duration of just over 14 years, and I'd say that it surely wouldn't be appropriate as the only bond fund in a portfolio with an investment horizon shorter than that (e.g in a retirement portfolio for an investor over age 70) though it could definitely persist as one of the bond holdings for such an investor.

The other consideration for a 50/50 portfolio would the the investor's exposure to the risk of unexpected inflation. I'd imagine that most investors with a 50/50 portfolio should probably be considering at least a partial allocation to TIPS.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

User avatar
noraz123
Posts: 268
Joined: Tue Jun 10, 2014 1:23 am
Location: SF Bay Area

Re: A low-cost 5 fund Boglehead portfolio

Post by noraz123 » Mon Jul 29, 2019 9:40 pm

vineviz wrote:
Mon Jul 29, 2019 6:48 pm
...
My goal was to keep expenses low (less than 0.10% if possible), rely on Vanguard-issued market-cap weighted index funds as much as possible, and to create a significantly more diversified portfolio than is possible using the the typical total market funds.
...
Is this 5 fund portfolio more diversified than the typical 3 fund portfolio (Total Stock, Total International, and Total Bond)?

I can see in a taxable account that a 5-fund portfolio allows for more tax loss harvesting, but unclear to me that that there is more diversification, especially "significantly" more.

A quick run through PortfolioVisualizer of your portfolio vs corresponding 3 fund (48% Total Stock, 32% Total International, 20% Total Bond), show remarkably similar results.
Link: https://www.portfoliovisualizer.com/bac ... 0&total3=0

User avatar
Sandtrap
Posts: 8289
Joined: Sat Nov 26, 2016 6:32 pm
Location: Hawaii No Ka Oi , N. Arizona

Re: A low-cost 5 fund Boglehead portfolio

Post by Sandtrap » Mon Jul 29, 2019 9:55 pm

noraz123 wrote:
Mon Jul 29, 2019 9:40 pm
vineviz wrote:
Mon Jul 29, 2019 6:48 pm
...
My goal was to keep expenses low (less than 0.10% if possible), rely on Vanguard-issued market-cap weighted index funds as much as possible, and to create a significantly more diversified portfolio than is possible using the the typical total market funds.
...
Is this 5 fund portfolio more diversified than the typical 3 fund portfolio (Total Stock, Total International, and Total Bond)?

I can see in a taxable account that a 5-fund portfolio allows for more tax loss harvesting, but unclear to me that that there is more diversification, especially "significantly" more.

A quick run through PortfolioVisualizer of your portfolio vs corresponding 3 fund (48% Total Stock, 32% Total International, 20% Total Bond), show remarkably similar results.
Link: https://www.portfoliovisualizer.com/bac ... 0&total3=0
Nice work.
Thanks for the link.
Does question the logic of making something more complex vs simple if the results are similar.

j
Wiki Bogleheads Wiki: Everything You Need to Know

User avatar
Topic Author
vineviz
Posts: 5077
Joined: Tue May 15, 2018 1:55 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by vineviz » Mon Jul 29, 2019 9:59 pm

retiringwhen wrote:
Mon Jul 29, 2019 8:26 pm
What is the principle/observation that keeps Large Cap Developed Markets out of the portfolio? High correlation with US Stocks?
Basically, yes.

In effect, exposure to large cap developed market stocks to being captured by "replication": the combined exposure to large cap US stocks and small cap developed market stocks give the portfolio exposure to the large cap developed stocks without actually needing to hold them directly.

Imagine a typical ink jet printer, which only contains four different colors of pigment but can combine them to produced thousands (or perhaps millions) of different colors on the printed page. Many of what we traditionally view as different assets or asset classes work the same way: high yield bonds can be replicated using stocks and treasury bonds; mid-cap stocks can be replicated using large-cap stocks and small-cap stocks; etc. This replication is never perfect, obviously, but when employed intelligently it can provide the investor a diversified portfolio without needing to hold absurdly large numbers of funds (e.g. the 15+ ETF portfolios advocated by Paul Merriman).

If you added a dedicated large cap developed market fund as a sixth fund to the portfolio, for instance, it would add virtually no additional sources of unique risk or return. The five fund portfolio captures something like 99.4% of the variation in returns that the six fund portfolio would provide.

A 20% increase in the number of holdings doesn't seem to me like a reasonable tradeoff for a mere 0.6% boost in diversification.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

mcraepat9
Posts: 1248
Joined: Thu Jul 16, 2015 11:46 am

Re: A low-cost 5 fund Boglehead portfolio

Post by mcraepat9 » Mon Jul 29, 2019 10:05 pm

Weird this is almost my exact portfolio. No long term bonds.
Amateur investors are not cool-headed logicians.

bluquark
Posts: 680
Joined: Mon Oct 22, 2018 2:30 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by bluquark » Mon Jul 29, 2019 10:29 pm

vineviz wrote:
Mon Jul 29, 2019 9:59 pm
If you added a dedicated large cap developed market fund as a sixth fund to the portfolio, for instance, it would add virtually no additional sources of unique risk or return. The five fund portfolio captures something like 99.4% of the variation in returns that the six fund portfolio would provide.

A 20% increase in the number of holdings doesn't seem to me like a reasonable tradeoff for a mere 0.6% boost in diversification.
OK, that's a pretty solid rationale, I'll concede.

How much boost in diversification does the US Small-Cap Value add by this metric? Could it be omitted by the same criterium?

MoneyMarathon
Posts: 556
Joined: Sun Sep 30, 2012 3:38 am

Re: A low-cost 5 fund Boglehead portfolio

Post by MoneyMarathon » Mon Jul 29, 2019 10:33 pm

vineviz wrote:
Mon Jul 29, 2019 9:59 pm
If you added a dedicated large cap developed market fund as a sixth fund to the portfolio, for instance, it would add virtually no additional sources of unique risk or return. The five fund portfolio captures something like 99.4% of the variation in returns that the six fund portfolio would provide.
What's your opinion on the Vanguard International Dividend Appreciation ETF (VIGI)?

https://investor.vanguard.com/etf/profile/VIGI

Would it have the same issue?

schismal
Posts: 121
Joined: Sat Apr 13, 2019 8:53 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by schismal » Tue Jul 30, 2019 4:27 am

noraz123 wrote:
Mon Jul 29, 2019 9:40 pm
vineviz wrote:
Mon Jul 29, 2019 6:48 pm
...
My goal was to keep expenses low (less than 0.10% if possible), rely on Vanguard-issued market-cap weighted index funds as much as possible, and to create a significantly more diversified portfolio than is possible using the the typical total market funds.
...
Is this 5 fund portfolio more diversified than the typical 3 fund portfolio (Total Stock, Total International, and Total Bond)?

I can see in a taxable account that a 5-fund portfolio allows for more tax loss harvesting, but unclear to me that that there is more diversification, especially "significantly" more.

A quick run through PortfolioVisualizer of your portfolio vs corresponding 3 fund (48% Total Stock, 32% Total International, 20% Total Bond), show remarkably similar results.
Link: https://www.portfoliovisualizer.com/bac ... 0&total3=0
Your PV link only goes back ~8 years. A quick substitution with equivalent funds takes us back just a few more years, and the performance difference becomes clear.

LINK

james22
Posts: 1408
Joined: Tue Aug 21, 2007 2:22 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by james22 » Tue Jul 30, 2019 5:17 am

vineviz wrote:
Mon Jul 29, 2019 6:48 pm
32.00% Vanguard Total Stock Market ETF (VTI)
16.00% Vanguard S&P Small-Cap 600 Value ETF (VIOV)
16.00% Vanguard FTSE All-Wld ex-US SmCp ETF (VSS)
16.00% Vanguard FTSE Emerging Markets ETF (VWO)
20.00% Vanguard Long-Term Bond ETF (BLV)
Why Total Stock Market?


I assume anything but the 3-fund Boglehead portfolio requires a pretty good understanding of financial research.

Without it, tilted portfolios like the proposed probably won't withstand periods of underperformance or even much tracking error.

With it, maybe something more like the Larry Portfolio:

30% SV (VSIAX)
30% EM (VEMAX) or IS (VFSAX)
30% LTT (VUSUX)
10% CCF (VCMDX)

Go big or go home. :happy

User avatar
Topic Author
vineviz
Posts: 5077
Joined: Tue May 15, 2018 1:55 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by vineviz » Tue Jul 30, 2019 6:04 am

noraz123 wrote:
Mon Jul 29, 2019 9:40 pm
vineviz wrote:
Mon Jul 29, 2019 6:48 pm
...
My goal was to keep expenses low (less than 0.10% if possible), rely on Vanguard-issued market-cap weighted index funds as much as possible, and to create a significantly more diversified portfolio than is possible using the the typical total market funds.
...
Is this 5 fund portfolio more diversified than the typical 3 fund portfolio (Total Stock, Total International, and Total Bond)?
It is more diversified in that it is more balanced in its exposure to independent sources of risk and return.

Differences in diversification aren't always going to be obvious when looking at the pattern of returns, especially over short time frames: it is always best to look at direct measures of diversification when possible.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

stan1
Posts: 7315
Joined: Mon Oct 08, 2007 4:35 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by stan1 » Tue Jul 30, 2019 7:15 am

mcraepat9 wrote:
Mon Jul 29, 2019 10:05 pm
Weird this is almost my exact portfolio. No long term bonds.
And pretty similar to mine created in 2009 [although I do have developed markets in the international slice].

I use a "Ninths" split for equity

6/9 domestic
3/9 international

4/9 VTI or SCHB [TLH pairs]
2/9 IJS, VIOV, VBR

1/9 VEA [now buying VXUS instead]
1/9 VWO
1/9 ISCF [formerly VINEX, this is in an IRA so I'll keep looking for better]

stan1
Posts: 7315
Joined: Mon Oct 08, 2007 4:35 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by stan1 » Tue Jul 30, 2019 7:39 am

schismal wrote:
Tue Jul 30, 2019 4:27 am
noraz123 wrote:
Mon Jul 29, 2019 9:40 pm
vineviz wrote:
Mon Jul 29, 2019 6:48 pm
...
My goal was to keep expenses low (less than 0.10% if possible), rely on Vanguard-issued market-cap weighted index funds as much as possible, and to create a significantly more diversified portfolio than is possible using the the typical total market funds.
...
Is this 5 fund portfolio more diversified than the typical 3 fund portfolio (Total Stock, Total International, and Total Bond)?

I can see in a taxable account that a 5-fund portfolio allows for more tax loss harvesting, but unclear to me that that there is more diversification, especially "significantly" more.

A quick run through PortfolioVisualizer of your portfolio vs corresponding 3 fund (48% Total Stock, 32% Total International, 20% Total Bond), show remarkably similar results.
Link: https://www.portfoliovisualizer.com/bac ... 0&total3=0
Your PV link only goes back ~8 years. A quick substitution with equivalent funds takes us back just a few more years, and the performance difference becomes clear.

LINK
You can go back to Jan 2001 with a few more changes (investor share mutual funds, VINEX for international small, and IJS for small value):
https://www.portfoliovisualizer.com/bac ... 0&total3=0

azanon
Posts: 2549
Joined: Mon Nov 07, 2011 10:34 am

Re: A low-cost 5 fund Boglehead portfolio

Post by azanon » Tue Jul 30, 2019 7:40 am

vineviz wrote:
Mon Jul 29, 2019 6:48 pm
16.00% Vanguard S&P Small-Cap 600 Value ETF (VIOV)
I had no idea Vanguard offered this. VBR is all that shows up when i screen for US small value. Is there some convenient place I can go on Vanguard's website to find all of the "secret" ETFs (and mutual funds, if applicable) that don't show up on the regular screens?

User avatar
Topic Author
vineviz
Posts: 5077
Joined: Tue May 15, 2018 1:55 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by vineviz » Tue Jul 30, 2019 7:43 am

azanon wrote:
Tue Jul 30, 2019 7:40 am
vineviz wrote:
Mon Jul 29, 2019 6:48 pm
16.00% Vanguard S&P Small-Cap 600 Value ETF (VIOV)
I had no idea Vanguard offered this. VBR is all that shows up when i screen for US small value. Is there some convenient place I can go on Vanguard's website to find all of the "secret" ETFs (and mutual funds, if applicable) that don't show up on the regular screens?
The version of the Vanguard website for financial advisors includes all of their funds, including the institutional funds (which is effectively what Vanguard considers ETFs like VIOV and their factor funds).

https://advisors.vanguard.com/VGApp/iip ... tClass_all
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

azanon
Posts: 2549
Joined: Mon Nov 07, 2011 10:34 am

Re: A low-cost 5 fund Boglehead portfolio

Post by azanon » Tue Jul 30, 2019 7:48 am

vineviz wrote:
Tue Jul 30, 2019 7:43 am
azanon wrote:
Tue Jul 30, 2019 7:40 am
vineviz wrote:
Mon Jul 29, 2019 6:48 pm
16.00% Vanguard S&P Small-Cap 600 Value ETF (VIOV)
I had no idea Vanguard offered this. VBR is all that shows up when i screen for US small value. Is there some convenient place I can go on Vanguard's website to find all of the "secret" ETFs (and mutual funds, if applicable) that don't show up on the regular screens?
The version of the Vanguard website for financial advisors includes all of their funds, including the institutional funds (which is effectively what Vanguard considers ETFs like VIOV and their factor funds).

https://advisors.vanguard.com/VGApp/iip ... tClass_all
Awesome, thx Vineviz. I'll never use the other screen again.

User avatar
Carlos Danger
Posts: 113
Joined: Fri Mar 16, 2018 6:32 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by Carlos Danger » Tue Jul 30, 2019 7:58 am

There are many ways to skin a cat. :sharebeer


Our 5-fund portolio, which is less than ideal given that I'm forced to use STFAX (State Street S&P 500 Index) and JAFLX (Janus Intermediate Term Bond Fund) in a crummy 403(b) plan, has performed almost identically through the 2008-2009 crash and subsequent Bull Market. A bit lower return, higher sharpe and sortino w/ lower standarrd deviation. 60% equities, 40% bonds/gold. Recently ditched TLT for EDV:

36% STFAX
24% JAFLX
24% VT
12% EDV
4% IAU

https://www.portfoliovisualizer.com/bac ... 0&total3=0


Your idea is obviously much heavier on international and mid/small cap. Our portfolio much heavier on fixed income.

fsh71
Posts: 61
Joined: Mon Jun 04, 2018 3:03 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by fsh71 » Tue Jul 30, 2019 8:01 am

This is a timely post for me as I have been seriously considering a permanent adjustment to my portfolio to better capture uncorrelated sources of risk and return.

I have leaned heavily on Merriman's ultimate buy & hold, and specifically the simplified 4-slice version (which is coincidentally also a 5-fund portfolio once bonds are added). It's admittedly not as aggressive as OP's tilt, but I have a feeling it may be more palatable for some.

32% Total US Stock Market Index
16% US Small Cap Value Index
21% Total International Stock Market Index
11% International Small Cap Index
20% Total Bond Market Index

I like the simplicity because the US and International equities are each 2/3rds large, 1/3rd small.

The 4 equity categories held are LCB, SCV, ILB, ISB.

azanon
Posts: 2549
Joined: Mon Nov 07, 2011 10:34 am

Re: A low-cost 5 fund Boglehead portfolio

Post by azanon » Tue Jul 30, 2019 8:02 am

vineviz wrote:
Mon Jul 29, 2019 6:48 pm
I'm frequently asked, sometimes by private message, if it's possible to build a low-cost portfolio that is both consistent with the Bogleheads investment philosophy (e.g. simplicity, low-cost, broadly diversified, etc.) and makes use of advances in financial research that have taken place over the past forty years.

This is definitely possible.

In order to avoid potentially confusing people with the well-established 3 and 4 fund Boglehead portfolios, I thought it might be instructive to put forward an example 5 fund portfolio that ticks all the Bogleheads boxes. I know that others (e.g. Larry Swedroe and Rick Ferri ) have done this before, so nothing radically new here. Just a fresh discussion.

My goal was to keep expenses low (less than 0.10% if possible), rely on Vanguard-issued market-cap weighted index funds as much as possible, and to create a significantly more diversified portfolio than is possible using the the typical total market funds. As an example, this portfolio is 80% stocks and 20% bonds but could easily be made more or less conservative.

32.00% Vanguard Total Stock Market ETF (VTI)
16.00% Vanguard S&P Small-Cap 600 Value ETF (VIOV)
16.00% Vanguard FTSE All-Wld ex-US SmCp ETF (VSS)
16.00% Vanguard FTSE Emerging Markets ETF (VWO)
20.00% Vanguard Long-Term Bond ETF (BLV)
Before I comment, I went back and reread the current Boglehead definition of "diversified" on wiki, and I admit it does meet that definition. That being said:

My comment would just be, before diving in, to think long and hard as to whether a portfolio containing 80% stocks is really diversified, and whether a portfolio like this is making use of all of the significant advances in financial research. A portfolio with 80% stocks, will have about 98% of its risk in that one asset class.

There were also financial advancements such as the creation of inflation-linked treasuries and I bonds, which have true inflation protection rather than just positive correlation with inflation. There were advancements in risk parity, and discoveries/demonstrations that low-equity portfolios produce the greatest amount of return per unit of risk (which is traditionally measured by most professionals with volatility). At any point and time, you can simulate this yourself at www.portfoliovisualizer.com. And it's not an anomaly, because if you consider the mathematics of combining multiple assets with varying volatilities and correlations, that outcome could have been predicted even beforehand, with no reason to see that being different in the future.

I also can't help but also reflect on the work and insight Tyler has at www.portfoliocharts.com (and Harry Brown's work), and many others (Mebane Faber comes to mind) where the inclusion of real assets enhances the risk-adjusted return of a portfolio. That portfolio doesn't have any.

I'll stop here, but I could list other examples. To recap - just consider whether YOU think that is diversified. I know "V" thinks it is because he said so. But I just glance at that, and I see 80% in stocks, and I don't see diversification. YMMV.

retiringwhen
Posts: 1286
Joined: Sat Jul 08, 2017 10:09 am
Location: New Jersey, USA

Re: A low-cost 5 fund Boglehead portfolio

Post by retiringwhen » Tue Jul 30, 2019 8:08 am

https://advisors.vanguard.com/VGApp/iip ... tClass_all

Awesome, thx Vineviz. I'll never use the other screen again.
When using the normal individual site ETF listings (Vanguard ETFs), there is a filter (click the Filters button in the top right corner of the page) under the heading Other Indexes with a checkbox for S&P and Russell. If you select that option, the list of ETFs is the "alternative" ETFs.

Also, on the VIOV fund description age, they explicitly tell you that VBR is cheaper and you should consider it as an alternative.

It is clear that Vanguard considers these second class citizens.

azanon
Posts: 2549
Joined: Mon Nov 07, 2011 10:34 am

Re: A low-cost 5 fund Boglehead portfolio

Post by azanon » Tue Jul 30, 2019 8:14 am

retiringwhen wrote:
Tue Jul 30, 2019 8:08 am
https://advisors.vanguard.com/VGApp/iip ... tClass_all

Awesome, thx Vineviz. I'll never use the other screen again.
When using the normal individual site ETF listings (Vanguard ETFs), there is a filter (click the Filters button in the top right corner of the page) under the heading Other Indexes with a checkbox for S&P and Russell. If you select that option, the list of ETFs is the "alternative" ETFs.

Also, on the VIOV fund description age, they explicitly tell you that VBR is cheaper and you should consider it as an alternative.

It is clear that Vanguard considers these second class citizens.
Is it that, or is that they're exclusive and hoping the common investor doesn't find out about them, only "institutions" with the big bucks.

livesoft
Posts: 67775
Joined: Thu Mar 01, 2007 8:00 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by livesoft » Tue Jul 30, 2019 8:21 am

I have a general question for many who responded in this thread. Given that vineviz gave a portfolio (paraphrasing):

32.00% Total US Stock Market Index
16.00% S&P US Small-Cap 600 Value Index
16.00% FTSE All-Wld ex-US SmCp Index
16.00% FTSE Emerging Markets Index
20.00% US Long-Term Bond Index

Why couldn't one just come up with their own ticker symbols and investments at their own brokerage that were low-cost and commission free whether that brokerage was Vanguard, Schwab, Fidelity, TDAmerirade, WellsTrade, et al. and whether one wanted to use mutual funds or ETFs? Does one really need help in choosing the actual investments/tickers when the asset classes (indexes) and ideas are presented so clearly?

PS: Taylor Larimore needs to drop in and state that this is not really a Boglehead portfolio, doesn't he?
Wiki This signature message sponsored by sscritic: Learn to fish.

retiringwhen
Posts: 1286
Joined: Sat Jul 08, 2017 10:09 am
Location: New Jersey, USA

Re: A low-cost 5 fund Boglehead portfolio

Post by retiringwhen » Tue Jul 30, 2019 8:24 am

azanon wrote:
Tue Jul 30, 2019 8:02 am
To recap - just consider whether YOU think that is diversified. I know "V" thinks it is because he said so. But I just glance at that, and I see 80% in stocks, and I don't see diversification. YMMV.
I took vineviz's proposal in the spirit of the 3-fund portfolio, meaning, you can scale your stock / bond AA as risk appropriate to the individual situation. Of course, that does raise the question of just how to decide if that Long-term Bond allocation actually makes sense. To my 56 year old self, it is looking kinda long for my entire bond allocation, for my 81 year-old dad, most definitely. For my 35 year old self (in the rear-view mirror) it may have been more appropriate (I held PTTRX back in those days, so Bill Gross decided my duration :shock:).

From a portfolio construction perspective, understanding the bond selection reasoning would be helpful. Vineviz's answer to my question related to the lack of Developed Markets for example is very helpful in evaluating the approach.

azanon
Posts: 2549
Joined: Mon Nov 07, 2011 10:34 am

Re: A low-cost 5 fund Boglehead portfolio

Post by azanon » Tue Jul 30, 2019 8:35 am

retiringwhen wrote:
Tue Jul 30, 2019 8:24 am
azanon wrote:
Tue Jul 30, 2019 8:02 am
To recap - just consider whether YOU think that is diversified. I know "V" thinks it is because he said so. But I just glance at that, and I see 80% in stocks, and I don't see diversification. YMMV.
I took vineviz's proposal in the spirit of the 3-fund portfolio, meaning, you can scale your stock / bond AA as risk appropriate to the individual situation. Of course, that does raise the question of just how to decide if that Long-term Bond allocation actually makes sense. To my 56 year old self, it is looking kinda long for my entire bond allocation, for my 81 year-old dad, most definitely. For my 35 year old self (in the rear-view mirror) it may have been more appropriate (I held PTTRX back in those days, so Bill Gross decided my duration :shock:).

From a portfolio construction perspective, understanding the bond selection reasoning would be helpful. Vineviz's answer to my question related to the lack of Developed Markets for example is very helpful in evaluating the approach.
Well, "you got me", so let me just go ahead and admit the 3-fund doesn't have any real assets either (or inflation-linked bonds), so it's not as diversified as it could be either. I just thought the comment here was appropriate because vineviz was making the claim that this one was including all of the latest research, and I saw a lot of the research (and new assets such as TIPS) wasn't being considered, or was, but was rejected for some reason.

Now one thing I believe vineviz and I probably agree on is that being troubled by the long-bond duration because of your age, might be that it's a bit myopic to just evaluate long-term bonds solely in terms of matching duration with one's time horizon. The reason "I" use LT bonds in my risk parity portfolio is because of their low degree of correlation, but high expected return relative to cash - in other words, I gain both lowered volatility and enhanced return when the LT bonds are periodically rebalanced. I couldn't care less whether the duration matches one's time horizon. Besides, hopefully you won't expire in 5 years so IT bonds aren't going to solve your issue either.

retiringwhen
Posts: 1286
Joined: Sat Jul 08, 2017 10:09 am
Location: New Jersey, USA

Re: A low-cost 5 fund Boglehead portfolio

Post by retiringwhen » Tue Jul 30, 2019 8:40 am

livesoft wrote:
Tue Jul 30, 2019 8:21 am
PS: Taylor Larimore needs to drop in and state that this is not really a Boglehead portfolio, doesn't he?
Of course, Taylor does....

Now, the interesting point is, as noted by the OP, it ticks all of the boxes for an Orthodox BH portfolio with one exception: How to define diversification.

We know vineviz has been working that question for a long-time here, and I find his approach unique, even if the results are relatively in-line with a larger community.

So, from that BH perspective, the question is can you be a BH and believe in tilting? In other words, the single biggest point of contention on the forum for the past eon..... This portfolio distills that question down pretty cleanly.

retiringwhen
Posts: 1286
Joined: Sat Jul 08, 2017 10:09 am
Location: New Jersey, USA

Re: A low-cost 5 fund Boglehead portfolio

Post by retiringwhen » Tue Jul 30, 2019 8:48 am

azanon wrote:
Tue Jul 30, 2019 8:35 am
Now one thing I believe vineviz and I probably agree on is that being troubled by the long-bond duration because of your age, might be that it's a bit myopic to just evaluate long-term bonds solely in terms of matching duration with one's time horizon. The reason "I" use LT bonds in my risk parity portfolio is because of their low degree of correlation, but high expected return relative to cash - in other words, I gain both lowered volatility and enhanced return when the LT bonds are periodically rebalanced. I couldn't care less whether the duration matches one's time horizon. Besides, hopefully you won't expire in 5 years so IT bonds aren't going to solve your issue either.
It too am aware that the LT bond approach acts quite differently wrt volatility and return, just think to make this portfolio approach actionable for the average investor, some sort of rationale is necessary to evaluate (I am starting to sound like a broken record on this thread :wink: )

User avatar
Topic Author
vineviz
Posts: 5077
Joined: Tue May 15, 2018 1:55 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by vineviz » Tue Jul 30, 2019 10:39 am

retiringwhen wrote:
Tue Jul 30, 2019 8:24 am
azanon wrote:
Tue Jul 30, 2019 8:02 am
To recap - just consider whether YOU think that is diversified. I know "V" thinks it is because he said so. But I just glance at that, and I see 80% in stocks, and I don't see diversification. YMMV.
I took vineviz's proposal in the spirit of the 3-fund portfolio, meaning, you can scale your stock / bond AA as risk appropriate to the individual situation.
Yes, thank you.

I chose an 80/20 allocation as the example in part because IMHO that allocation neutralizes many of the other confounding issues with respect to portfolio allocation: pretty much anyone who is 80% in stocks should allocate the other 20% to long-term bonds. And if long-term bonds aren't appropriate for an investor, an 80/20 portfolio probably isn't either.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

dbr
Posts: 30096
Joined: Sun Mar 04, 2007 9:50 am

Re: A low-cost 5 fund Boglehead portfolio

Post by dbr » Tue Jul 30, 2019 10:52 am

I'm not sure how this fits Point 3 in BH philosophy "Never bear too much or too little risk." The missing component is how to adjust this for risk. That adjustment is simple and obvious for the 3 fund portfolio. Is the adjustment here to put 60% in long term bonds and reduce everything else proportionately. A comparison might be made to versions of the Larry Portfolio, which is all stocks in small cap value but uses short (I think Treasuries) in significant fraction to balance out risk.

User avatar
Taylor Larimore
Advisory Board
Posts: 28584
Joined: Tue Feb 27, 2007 8:09 pm
Location: Miami FL

Re: A low-cost 5 fund Boglehead portfolio

Post by Taylor Larimore » Tue Jul 30, 2019 10:54 am

livesoft wrote:
Tue Jul 30, 2019 8:21 am
I have a general question for many who responded in this thread. Given that vineviz gave a portfolio (paraphrasing):

32.00% Total US Stock Market Index
16.00% S&P US Small-Cap 600 Value Index
16.00% FTSE All-Wld ex-US SmCp Index
16.00% FTSE Emerging Markets Index
20.00% US Long-Term Bond Index

Why couldn't one just come up with their own ticker symbols and investments at their own brokerage that were low-cost and commission free whether that brokerage was Vanguard, Schwab, Fidelity, TDAmerirade, WellsTrade, et al. and whether one wanted to use mutual funds or ETFs? Does one really need help in choosing the actual investments/tickers when the asset classes (indexes) and ideas are presented so clearly?

PS: Taylor Larimore needs to drop in and state that this is not really a Boglehead portfolio, doesn't he?
livesoft:

A Boglehead portfolio is one that meets all, or most of the criteria, in The Bogleheads Investment Philosophy:
1 Develop a workable plan
2 Invest early and often
3 Never bear too much or too little risk
4 Diversify
5 Never try to time the market
6 Use index funds when possible
7 Keep costs low
8 Minimize taxes
9 Invest with simplicity
10 Stay the course
In my opinion, vineviz's 5-fund portfolio meets this test.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "Don't think you know more than the market. Nobody does."
"Simplicity is the master key to financial success." -- Jack Bogle

User avatar
Steadfast
Posts: 181
Joined: Wed Nov 06, 2013 3:44 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by Steadfast » Tue Jul 30, 2019 11:15 am

If I was doing this I'd use VFVA for the U.S. small value fund. Way smaller, way more valuey.

But, I'm not doing this.
We don't see things as they are, we see things as we are.

azanon
Posts: 2549
Joined: Mon Nov 07, 2011 10:34 am

Re: A low-cost 5 fund Boglehead portfolio

Post by azanon » Tue Jul 30, 2019 11:27 am

Steadfast wrote:
Tue Jul 30, 2019 11:15 am
If I was doing this I'd use VFVA for the U.S. small value fund. Way smaller, way more valuey.

But, I'm not doing this.
VFVA is more mid-cap (on average), and VIOV is well within the small cap range. You're right about VFVA being more valuey though.

klaus14
Posts: 238
Joined: Sun Nov 25, 2018 7:43 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by klaus14 » Tue Jul 30, 2019 11:46 am

vineviz wrote:
Mon Jul 29, 2019 6:48 pm

32.00% Vanguard Total Stock Market ETF (VTI)
16.00% Vanguard S&P Small-Cap 600 Value ETF (VIOV)
16.00% Vanguard FTSE All-Wld ex-US SmCp ETF (VSS)
16.00% Vanguard FTSE Emerging Markets ETF (VWO)
20.00% Vanguard Long-Term Bond ETF (BLV)
isn't this too heavy on emerging equities? especially considering VSS also has 20% EM. i think even in your own portfolio you aimed at only 40% of INT for EM.

-----

I think this portfolio is great, but can be enhanced even further by:
- moving 8% of VTI to gold (GLDM). Gold as a portfolio insurance. In addition, now stocks are world market cap split between US and ExUS but portfolio is still home biased because of USD bonds.
- moving 8% of VWO to Emerging Debt (LEMB). Now you have much better geographic diversity (no more China/Taiwan concentration) and much lower volatility from EM.
- moving BLV to EDV + LTPZ for better efficiency (EDV even longer term) and inflation protection.

Now it becomes:

24.00% Vanguard Total Stock Market ETF (VTI)
16.00% Vanguard S&P Small-Cap 600 Value ETF (VIOV)
16.00% Vanguard FTSE All-Wld ex-US SmCp ETF (VSS)
8.00% Vanguard FTSE Emerging Markets ETF (VWO)
8.00% iShares J.P. Morgan EM Local Currency Bond ETF (LEMB) (ER: 0.30%)
10.00% Vanguard Extended Duration Treasury ETF (EDV) (ER: 0.07%)
10.00% PIMCO 15+ Year U.S. TIPS Index Exchange-Traded Fund (LTPZ) (ER: 0.20%)
8% SPDR® Gold MiniSharesSM Trust (ER: 0.18%)

Slightly more complex/expensive, but gold, EM Debt and TIPS are different sources of return, risk and protection that are not provided by original portfolio. So in that sense, this version is more diversified.

I should also add that best way to make this portfolio more conservative is to move funds from stocks to CDs. CDs are only available to small investors, as safe as treasuries and offers much better return. One more small improvement is to use IBonds, to the extend allowed, instead of TIPS when they offer better rates (like right now)
Last edited by klaus14 on Tue Jul 30, 2019 12:18 pm, edited 7 times in total.

MoneyMarathon
Posts: 556
Joined: Sun Sep 30, 2012 3:38 am

Re: A low-cost 5 fund Boglehead portfolio

Post by MoneyMarathon » Tue Jul 30, 2019 11:53 am

vineviz wrote:
Mon Jul 29, 2019 9:59 pm
The five fund portfolio captures something like 99.4% of the variation in returns that the six fund portfolio would provide.
How are you doing this calculation? How can others do the calculation, is there any easy way?

azanon
Posts: 2549
Joined: Mon Nov 07, 2011 10:34 am

Re: A low-cost 5 fund Boglehead portfolio

Post by azanon » Tue Jul 30, 2019 12:22 pm

klaus14 wrote:
Tue Jul 30, 2019 11:46 am
vineviz wrote:
Mon Jul 29, 2019 6:48 pm

Slightly more complex/expensive, but gold, EM Debt and TIPS are different sources of return, risk and protection that are not provided by original portfolio. So in that sense, this version is more diversified.

I should also add that best way to make this portfolio more conservative is to move funds from stocks to CDs. CDs are only available to small investors, as safe as treasuries and offers much better return. One more small improvement is to use IBonds to the extend allowed instead of TIPS when they offer better rates (like right now)
A step in the right direction, but still a stock-lovers only portfolio (still ~ 2/3rds stocks). Basically, do it ony if you consider stocks to be a superior asset class (defined as, provides more return relative to risk vs. other asset classes return-to-risk profile).

The way I'd make it more conservative is to increase the allocation to EDV and LTPZ in your proposed modification, but more LTPZ than EDV. You can't rebalance with CDs, and those have no inflation protection. You can't rebalance with ibonds either.

KyleAAA
Posts: 7368
Joined: Wed Jul 01, 2009 5:35 pm
Contact:

Re: A low-cost 5 fund Boglehead portfolio

Post by KyleAAA » Tue Jul 30, 2019 12:30 pm

The only change I would make would be to use long term treasuries rather than the long term bond fund to make the portfolio slightly more efficient.

klaus14
Posts: 238
Joined: Sun Nov 25, 2018 7:43 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by klaus14 » Tue Jul 30, 2019 12:36 pm

azanon wrote:
Tue Jul 30, 2019 12:22 pm
klaus14 wrote:
Tue Jul 30, 2019 11:46 am
vineviz wrote:
Mon Jul 29, 2019 6:48 pm

Slightly more complex/expensive, but gold, EM Debt and TIPS are different sources of return, risk and protection that are not provided by original portfolio. So in that sense, this version is more diversified.

I should also add that best way to make this portfolio more conservative is to move funds from stocks to CDs. CDs are only available to small investors, as safe as treasuries and offers much better return. One more small improvement is to use IBonds to the extend allowed instead of TIPS when they offer better rates (like right now)
A step in the right direction, but still a stock-lovers only portfolio (still ~ 2/3rds stocks). Basically, do it ony if you consider stocks to be a superior asset class (defined as, provides more return relative to risk vs. other asset classes return-to-risk profile).

The way I'd make it more conservative is to increase the allocation to EDV and LTPZ in your proposed modification, but more LTPZ than EDV. You can't rebalance with CDs, and those have no inflation protection. You can't rebalance with ibonds either.
CDs have unique properties. I recently opened a 5 year 2.75% CD in Ally. Early withdrawal penalty is just 150 days of interest. So if an inflation spike and interest rate spike happens, i am only at risk for 1.1%.

Biggest allure of IBonds is that they are tax efficient.

And for the readers, i think the reason azanon wants more LTPZ than EDV is that: 1) LTPZ has less volatility than EDV, 2) He wants to increase inflation protection.

Morse Code
Posts: 128
Joined: Wed Mar 14, 2007 12:02 pm
Location: Grand Rapids, MI

Re: A low-cost 5 fund Boglehead portfolio

Post by Morse Code » Tue Jul 30, 2019 12:43 pm

Steadfast wrote:
Tue Jul 30, 2019 11:15 am
If I was doing this I'd use VFVA for the U.S. small value fund. Way smaller, way more valuey.

But, I'm not doing this.
VFVA median market cap, 6.0 billion. VIOV median market cap, 1.6 billion.
Livin' the dream

dorster
Posts: 19
Joined: Tue Aug 15, 2017 4:20 pm

Re: A low-cost 5 fund Boglehead portfolio

Post by dorster » Tue Jul 30, 2019 12:49 pm

vineviz wrote:
Mon Jul 29, 2019 6:48 pm
32.00% Vanguard Total Stock Market ETF (VTI)
16.00% Vanguard S&P Small-Cap 600 Value ETF (VIOV)
16.00% Vanguard FTSE All-Wld ex-US SmCp ETF (VSS)
16.00% Vanguard FTSE Emerging Markets ETF (VWO)
20.00% Vanguard Long-Term Bond ETF (BLV)
Vineviz, would you mind commenting on your choice of Vanguard Long-Term Bond Fund (roughly half investment-grade bonds and half treasuries)?

I was under the impression that it was usually better to increase equity exposure and use pure treasuries (VGLT or EDV) instead of investment-grade bonds. For example 84/16 Stocks/EDV instead of 80/20 Stocks/BLV.

I did note that in the State Street portfolio example you did use treasuries so maybe I'm reading more into this than is warranted.

Any thoughts or observations on BLV vs VGLT/EDV would be appreciated.

I always appreciate your posts. Thanks!

User avatar
ray.james
Posts: 1126
Joined: Tue Jul 19, 2011 4:08 am

Re: A low-cost 5 fund Boglehead portfolio

Post by ray.james » Tue Jul 30, 2019 12:53 pm

This is very akin to 4 fund slice and dice discussion except for emerging markets(By TrevH). I used that as a basis to my allocation.

In general VSS is more like mid+ small cap. VWO is very large cap heavy. SO the risk and return curve is probably converging with TrevH 4 fund slice and dice portfolio. Great overall portfolio vineviz
When in doubt, http://www.bogleheads.org/forum/viewtopic.php?f=1&t=79939

Post Reply