Boglehead/Vanguard way to retire.

2% just to be picky.

Excellent idea.

 

Re: Asset Allocation

Buffett who's bullish on shares and America, recommended the below 90/10 split for his heirs

My advice to the trustee couldn't be more simple: Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. (I suggest Vanguard's.) I believe the trust's long-term results from this policy will be superior to those attained by most investors — whether pension funds, institutions or individuals — who employ high-fee managers.

 

Thanks @ErYan. Makes sense.

 

I had a look at vanguard's chart from 1970-2017. I was trying to compare performance of VTS vs VGS. i do know vts reflect just total us share market but still returns for vts were significantly higher than vgs. Does any one have a view on this? ( sorry if this come across as naive question)

 

VGS is reasonably new and even VTS doesn't go back too far in Australia (around 2008-2009 from memory)

Regarding any differences, VGS is domiciled in Australia and is a mix (US and World) whilst VTS is US only

 

@austing

Thought of you when I saw this chart

As the table below shows, the worst performing asset in one year often becomes the best performer in the next and vice versa.


Cash V Bonds was interesting

What I’ve learned from 21 years of investing

 

Why?

 

RW loves the BONNDDZZZZZZZZZZZZZ

 

His real name is James, James Bond.

Portfolio Approach - Shaken but not stirred.

I own Bonds undies, does that count as diversification.

 

The other part is the rebalance free lunch

 

Would like to see same chart through to 2016, would love to see cash returning 4% as well.......

 

Is timing important? Is it good time to get in now?

 

Is timing important? Is it good time to get in now?

 

Hi guys, just wondering what peoples thoughts are on the large weighting of the banks in most AU broad based ETFs? (some weighted around 30%)

With the strong correlation between banks and property, should this be of concern in regards to diversification?

 

The alternative is to stock pick or allow someone else to do it for you - which isn't very Boglehead.

Maintaining your International exposure via VGS or similar greatly reduces you exposure and weighting to the concentration of the AU market. International Bogleheaders would probably not agree with AU investors home bias given AU is only 2% of the market - there are some good reasons to do so however.

Anyway you need to invest in a way the makes sense to you and that you are comfortable with.

 

What are peoples thoughts on the Betashares EX20 product?, by removing the top 20 it moves financials exposure down to 10%.

Materials 21.4%

Real Estate 12.9%

Consumer Discretionary 12.1%

Financials 11.1%

Industrials 10.1%

Healthcare 9.7%

Energy 6.9%

Utilities 6.6%

Consumer Staples 4.1%

Information Technology 3.1%

Telecommunication Services 2.1%

What would be the downside from removing the top 20 from the portfolio?

 

No downside if you have other shares that contain top 20, which most people inevitably do.

[edit] obvious downside is if the ex20 shares all decrease in price.

Not advice

 

VAS would cover that?

 

From a post in the LIC thread

The difference is likely from the investor themselves tinkering, in a retirement fund where you continue to regularly add new funds (DCA) buying more units in times of fear and less in times of greed, and with the fund doing its own re-balancing on really bad days, it outperforms its own index benchmark

 

VAS covers top 400 which is predominantly the top 20 cap weighted or there is iShares S&P/ASX 20 ETF | ILC

Not advice