VTINX vs three fund portfolio

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bethanybeachreader
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Joined: Mon Mar 12, 2018 6:55 am

VTINX vs three fund portfolio

Post by bethanybeachreader »

I was lazy and used VTINX (vanguard target retirement income fund) instead of the three fund portfolio that is widely discussed here. VTINX is down 12% for the year.

Just curious, how are you all that follow the three funds portfolio doing. I know that result will vary depending on what three funds you pick and the allocation percentages. Don't need to know the details on which funds, just the amount you're down for the year.
Mike Scott
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Re: VTINX vs three fund portfolio

Post by Mike Scott »

You can run the equivalent comparisons in something like portfolio visualizer. Tweak it any way you want.
dbr
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Re: VTINX vs three fund portfolio

Post by dbr »

Here are two data points.

In 2022 my portfolio returned -12.83% and VTINX returned -11.17% Portfolio Visualizer 1/22-8/22.

In the period 1/2012 to 8/2022 my portfolio returned 7.68% and VTINX returned 4.33% in Portfolio Visualizer. The date range is limited by having data for the funds. Those numbers are fund performance. My personal IRR would be different because there have been withdrawals all along. I don't have a number for that.

Without getting into specifics the difference is that I have more in US total stock market than VTINX does. I also have less in international stocks and bonds and more in TIPS. My portfolio was also more volatile but had a larger Sharpe ratio indicating an efficiency or risk adjusted return measure.

I would be sure to emphasize that this is a different choice and not a superior choice.
Robot Monster
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Re: VTINX vs three fund portfolio

Post by Robot Monster »

VTINX is 17.10% Short-Term Inflation-Protected Securities, which gave it an edge, as rate rose, over an equivalent portfolio that only has intermediate-term bonds.
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grabiner
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Re: VTINX vs three fund portfolio

Post by grabiner »

There is no single three-fund portfolio; you can have a three-fund portfolio with any stock/bond ratio, depending on your risk tolerance.

The Target Retirement funds are similar to the three-fund portfolios, also holding different amounts of stock. (They hold a small amount in international bonds, and short-term TIPS for some funds, but this doesn't make much difference.) Therefore, a Target Retirement fund should have essentially the same returns as a three-fund portfolio with the same stock allocation.
Wiki David Grabiner
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