Jack Bogle - Two Fund Portfolio

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FIREchief
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Re: Jack Bogle - Two Fund Portfolio

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Northern Flicker wrote: Sun May 16, 2021 6:51 pm
FIREchief wrote: Sun May 16, 2021 5:41 pm I'm sure glad I didn't have target date funds over three decades ago when I started investing. I just put 100% into S&P 500 index funds and focused on life. It worked out well! 8-) You won't find that in any target date funds. They're much more "sophisticated." :oops:
A lot of individual investors are 100% stock because they want the robust return. But when the market is down 40%, some/many of them lose their nerve and bail. TDF's and balanced funds help investors with less resolve than yourself stay the course, improving returns for them.
All true for "a lot" of investors. They likely just need some good coaching rather than a "forced" TDF approach.
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Re: Jack Bogle - Two Fund Portfolio

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Da5id wrote: Sun May 16, 2021 5:51 pm
FIREchief wrote: Sun May 16, 2021 5:41 pm I'm sure glad I didn't have target date funds over three decades ago when I started investing. I just put 100% into S&P 500 index funds and focused on life. It worked out well! 8-) You won't find that in any target date funds. They're much more "sophisticated." :oops:
Target date funds 30 years out are maybe 90% stocks.
Yes, but they have those icky foreign stocks in them. Also, what's the point of 10% fixed for a 30 year horizon? (That's rhetorical, I know the answer) 8-)
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Re: Jack Bogle - Two Fund Portfolio

Post by Da5id »

FIREchief wrote: Sun May 16, 2021 7:55 pm
Da5id wrote: Sun May 16, 2021 5:51 pm
FIREchief wrote: Sun May 16, 2021 5:41 pm I'm sure glad I didn't have target date funds over three decades ago when I started investing. I just put 100% into S&P 500 index funds and focused on life. It worked out well! 8-) You won't find that in any target date funds. They're much more "sophisticated." :oops:
Target date funds 30 years out are maybe 90% stocks.
Yes, but they have those icky foreign stocks in them. Also, what's the point of 10% fixed for a 30 year horizon? (That's rhetorical, I know the answer) 8-)
Meh.
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Re: Jack Bogle - Two Fund Portfolio

Post by 1789 »

FIREchief wrote: Sun May 16, 2021 5:41 pm I'm sure glad I didn't have target date funds over three decades ago when I started investing. I just put 100% into S&P 500 index funds and focused on life. It worked out well! 8-) You won't find that in any target date funds. They're much more "sophisticated." :oops:
Congratulations. Decades ago you knew what would be one of the best portfolios one could ever constructed.
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Re: Jack Bogle - Two Fund Portfolio

Post by Nathan Drake »

1789 wrote: Sun May 16, 2021 9:10 pm
FIREchief wrote: Sun May 16, 2021 5:41 pm I'm sure glad I didn't have target date funds over three decades ago when I started investing. I just put 100% into S&P 500 index funds and focused on life. It worked out well! 8-) You won't find that in any target date funds. They're much more "sophisticated." :oops:
Congratulations. Decades ago you knew what would be one of the best portfolios one could ever constructed.
Too bad he didn't place it all into Small Cap Value, he would have a lot more today.
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Re: Jack Bogle - Two Fund Portfolio

Post by 1789 »

Nathan Drake wrote: Sun May 16, 2021 9:18 pm
1789 wrote: Sun May 16, 2021 9:10 pm
FIREchief wrote: Sun May 16, 2021 5:41 pm I'm sure glad I didn't have target date funds over three decades ago when I started investing. I just put 100% into S&P 500 index funds and focused on life. It worked out well! 8-) You won't find that in any target date funds. They're much more "sophisticated." :oops:
Congratulations. Decades ago you knew what would be one of the best portfolios one could ever constructed.
Too bad he didn't place it all into Small Cap Value, he would have a lot more today.
True. Putting 100% SP500 worked for him. Means probably he would not stick with 100% SCV, thats the big issue there.
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Re: Jack Bogle - Two Fund Portfolio

Post by Northern Flicker »

FIREchief wrote: Sun May 16, 2021 7:53 pm
Northern Flicker wrote: Sun May 16, 2021 6:51 pm
FIREchief wrote: Sun May 16, 2021 5:41 pm I'm sure glad I didn't have target date funds over three decades ago when I started investing. I just put 100% into S&P 500 index funds and focused on life. It worked out well! 8-) You won't find that in any target date funds. They're much more "sophisticated." :oops:
A lot of individual investors are 100% stock because they want the robust return. But when the market is down 40%, some/many of them lose their nerve and bail. TDF's and balanced funds help investors with less resolve than yourself stay the course, improving returns for them.
All true for "a lot" of investors. They likely just need some good coaching rather than a "forced" TDF approach.
It is difficult to coach away emotions. If someone is not comfortable managing themselves and the situation with a 50-55% portfolio drawdown, they should not be 100% stocks.

The main flaw that I see in TDF's is that the ratio of contribution amount to account balance is not an input to the glide path determination, despite regular contributions being one of the mitigators of equity risk.
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Re: Jack Bogle - Two Fund Portfolio

Post by anon_investor »

Northern Flicker wrote: Sun May 16, 2021 10:12 pm
FIREchief wrote: Sun May 16, 2021 7:53 pm
Northern Flicker wrote: Sun May 16, 2021 6:51 pm
FIREchief wrote: Sun May 16, 2021 5:41 pm I'm sure glad I didn't have target date funds over three decades ago when I started investing. I just put 100% into S&P 500 index funds and focused on life. It worked out well! 8-) You won't find that in any target date funds. They're much more "sophisticated." :oops:
A lot of individual investors are 100% stock because they want the robust return. But when the market is down 40%, some/many of them lose their nerve and bail. TDF's and balanced funds help investors with less resolve than yourself stay the course, improving returns for them.
All true for "a lot" of investors. They likely just need some good coaching rather than a "forced" TDF approach.
It is difficult to coach away emotions. If someone is not comfortable managing themselves and the situation with a 50-55% portfolio drawdown, they should not be 100% stocks.

The main flaw that I see in TDF's is that the ratio of contribution amount to account balance is not an input to the glide path determination, despite regular contributions being one of the mitigators of equity risk.
Not sure how someone who is not comfortable with a 50% drawdown is going to fare much better with a TDF that is 90% equities. I think the equity/fixed income ratio is more important for someone in matching their risk tolerance than their US/international equity ratio.
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Re: Jack Bogle - Two Fund Portfolio

Post by Northern Flicker »

That's true, but they do have the advantage of being hands off. I did mention both TDFs and balanced funds in my posting. The LifeStrategy Funds, Balanced Index Fund, Star Fund, or Wellington Fund are all part of the range of options I was referring to, along with TDFs.

I think a young saver using tax-qualified accounts could start with LifeStrategy Growth (vasgx) and switch to LifeStrategy Moderate Growth (vsmgx) around age 50-55 and possibly switch to Target Retirement Income (vtinx) around age 70-75 for a less aggressive stance than a TDF glide path today.
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Re: Jack Bogle - Two Fund Portfolio

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1789 wrote: Sun May 16, 2021 10:04 pm
Nathan Drake wrote: Sun May 16, 2021 9:18 pm
1789 wrote: Sun May 16, 2021 9:10 pm
FIREchief wrote: Sun May 16, 2021 5:41 pm I'm sure glad I didn't have target date funds over three decades ago when I started investing. I just put 100% into S&P 500 index funds and focused on life. It worked out well! 8-) You won't find that in any target date funds. They're much more "sophisticated." :oops:
Congratulations. Decades ago you knew what would be one of the best portfolios one could ever constructed.
Too bad he didn't place it all into Small Cap Value, he would have a lot more today.
True. Putting 100% SP500 worked for him. Means probably he would not stick with 100% SCV, thats the big issue there.
Thanks. You get it. Fact is, I didn't know nothing back then. I just knew that US stocks were a good long term wager. I used to listen to G. Gordon Liddy's AM talk radio program. That man was a genius on many topics. One day, a lady called in and shared what she had received as a suggestion for investing. In his typical style, he suggested that "no, you don't need any of that" and proceeded to explain in about five minutes the value of a low cost investment in an S&P 500 index fund. That man was a Boglehead whether he knew it or not (I don't believe they existed back then). Made sense to me, so that's what I did. He had no profit motive and didn't recommend any specific fund. Just a passive S&P 500 index fund. I never really had any reason to revisit that decision. When I approached FIRE a little more than five years ago, I found this forum and learned a LOT more. Guess what? It really didn't change much. So why can't that work for new investors today? Is it too "unsophisticated?" :oops: Do we really need target date funds with their higher expenses and awful foreign exposure? I think not.... 8-)
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Re: Jack Bogle - Two Fund Portfolio

Post by Northern Flicker »

If an investor is going to stay 100% stock, a TDF serves no purpose. It happens that you started investing when interest rates were still high from the overhang of the inflation of the 1970's. Your investment trajectory had the tailwind of interest rates falling consistently, lowering the discount rate for future cash flows of corporate revenue, which boosts the present value of those cash flows, all else equal.

This was not inevitable. With some quite plausible different macroeconomic trajectories, my guess is that we would be having a different conversation about it. That it worked out does not mean that it was the best strategy probabilistically.

We manage retirement assets in a manner we think is prudent and well suited to meeting our goals, and it has proved to work out well, but I would feel presumptuous to claim it was a priori a superior strategy to that used for any particular TDF product.
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Re: Jack Bogle - Two Fund Portfolio

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Northern Flicker wrote: Sun May 16, 2021 10:12 pm The main flaw that I see in TDF's is that the ratio of contribution amount to account balance is not an input to the glide path determination, despite regular contributions being one of the mitigators of equity risk.
This is only true in the sense that the glide path is not custom tailored to each individual investor, but that “flaw” would be present for any mutual fund.

But the shape of the glide path does take into account the fact that the ratio of contributions to account balances changes over time. In fact, this change is the MAIN determinant of the glide path shape.
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Re: Jack Bogle - Two Fund Portfolio

Post by abuss368 »

Bogleheads -

Excellent interview from Christine Benz with our mentor Jack Bogle “Why Jack Bogle does not own non-US stocks”

https://www.morningstar.com/articles/88 ... -us-stocks

Enjoy!
Tony
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Re: Jack Bogle - Two Fund Portfolio

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abuss368 wrote: Mon May 17, 2021 9:23 am Bogleheads -

Excellent interview from Christine Benz with our mentor Jack Bogle “Why Jack Bogle does not own non-US stocks”

https://www.morningstar.com/articles/88 ... -us-stocks

Enjoy!
Tony
That's great. Thanks for posting. I'm keeping with my US only portfolio.
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Re: Jack Bogle - Two Fund Portfolio

Post by Da5id »

Vanguard has offered their projections for the coming decade here: https://advisors.vanguard.com/insights/ ... vesmay2021. The basis for their projections is here https://personal.vanguard.com/pdf/ISGUS ... online.pdf. They project that international stocks over the next 10 years will outperform US by about 3%. I think perhaps the most interesting part about the whole thing is the breakdown of the sources of US outperformance over the 10 years from 2010-2020.

Image

The lions share of US outperformance over the period was relative increase in valuations of US vs International. Maybe this aspect of the outperformance will go on forever. Historically it hasn't though.

Now you may be skeptical about the accuracy of such projections of future returns. I certainly am. If so, it may be worth considering that the fundamental tenet of this thread is a projection of future returns. It is an assertion that US will out perform International in the future. And maybe it will. But why go all in on such a risky bet? Why chase recent US outperformance predicting it will go on into the indefinite future?
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Re: Jack Bogle - Two Fund Portfolio

Post by FIREchief »

Da5id wrote: Mon May 17, 2021 12:12 pm Why chase recent US outperformance predicting it will go on into the indefinite future?
Is it "chasing" if a person has been 100% US for decades? Or, is it just sticking with the horse that got you "here." 8-)
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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Re: Jack Bogle - Two Fund Portfolio

Post by Nathan Drake »

FIREchief wrote: Mon May 17, 2021 1:48 pm
Da5id wrote: Mon May 17, 2021 12:12 pm Why chase recent US outperformance predicting it will go on into the indefinite future?
Is it "chasing" if a person has been 100% US for decades? Or, is it just sticking with the horse that got you "here." 8-)
It’s getting lucky over a certain period, and probably better off adjusting the allocation to something more diversified going forward
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Re: Jack Bogle - Two Fund Portfolio

Post by Da5id »

FIREchief wrote: Mon May 17, 2021 1:48 pm
Da5id wrote: Mon May 17, 2021 12:12 pm Why chase recent US outperformance predicting it will go on into the indefinite future?
Is it "chasing" if a person has been 100% US for decades? Or, is it just sticking with the horse that got you "here." 8-)
Advocating for 100% US based on past performance in the present, or advocating that others adopt 100% in the present feels like chasing to me.
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Re: Jack Bogle - Two Fund Portfolio

Post by DB2 »

Da5id wrote: Mon May 17, 2021 12:12 pm Vanguard has offered their projections for the coming decade here: https://advisors.vanguard.com/insights/ ... vesmay2021. The basis for their projections is here https://personal.vanguard.com/pdf/ISGUS ... online.pdf. They project that international stocks over the next 10 years will outperform US by about 3%. I think perhaps the most interesting part about the whole thing is the breakdown of the sources of US outperformance over the 10 years from 2010-2020.

Image

The lions share of US outperformance over the period was relative increase in valuations of US vs International. Maybe this aspect of the outperformance will go on forever. Historically it hasn't though.

Now you may be skeptical about the accuracy of such projections of future returns. I certainly am. If so, it may be worth considering that the fundamental tenet of this thread is a projection of future returns. It is an assertion that US will out perform International in the future. And maybe it will. But why go all in on such a risky bet? Why chase recent US outperformance predicting it will go on into the indefinite future?
If the U.S. becomes a Japan situation (and there are some similarities already), are those holding 100% U.S. willing to stay the course for 20-30+ years? It's an honest question for one to ask him/herself. The vast majority of truly globally diversified investors on this forum seem to have no problem holding international stocks despite significantly lagging U.S. since the late 2000s. This is an especially interesting question for those with a longer time horizon.
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Re: Jack Bogle - Two Fund Portfolio

Post by Nathan Drake »

DB2 wrote: Mon May 17, 2021 2:10 pm
Da5id wrote: Mon May 17, 2021 12:12 pm Vanguard has offered their projections for the coming decade here: https://advisors.vanguard.com/insights/ ... vesmay2021. The basis for their projections is here https://personal.vanguard.com/pdf/ISGUS ... online.pdf. They project that international stocks over the next 10 years will outperform US by about 3%. I think perhaps the most interesting part about the whole thing is the breakdown of the sources of US outperformance over the 10 years from 2010-2020.

Image

The lions share of US outperformance over the period was relative increase in valuations of US vs International. Maybe this aspect of the outperformance will go on forever. Historically it hasn't though.

Now you may be skeptical about the accuracy of such projections of future returns. I certainly am. If so, it may be worth considering that the fundamental tenet of this thread is a projection of future returns. It is an assertion that US will out perform International in the future. And maybe it will. But why go all in on such a risky bet? Why chase recent US outperformance predicting it will go on into the indefinite future?
If the U.S. becomes a Japan situation (and there are some similarities already), are those holding 100% U.S. willing to stay the course for 20-30+ years? It's an honest question for one to ask him/herself. The vast majority of truly globally diversified investors on this forum seem to have no problem holding international stocks despite significantly lagging U.S. since the late 2000s. This is an especially interesting question for those with a longer time horizon.
As someone holding around market weight for international, the fact that the majority of US outperformance recently has been due to speculative increase in price, it just gives me more confidence that being diversified is the right move to make
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Re: Jack Bogle - Two Fund Portfolio

Post by Northern Flicker »

abuss368 wrote: Mon May 17, 2021 9:23 am Bogleheads -

Excellent interview from Christine Benz with our mentor Jack Bogle “Why Jack Bogle does not own non-US stocks”

https://www.morningstar.com/articles/88 ... -us-stocks

Enjoy!
Tony
Jack Bogle's argument, particularly around currency risk, is why I limited non-US equities to 25% of equities, though Mr. Bogle was not the source of that information when I established the allocation. In all of his interviews or writings on the subject, I've never heard him discuss inflation risk. From 1967 to 1981, the real return of the S&P500 was zero. USD-denominated bonds had a negative real return. T-bills or cash had real
return of zero. Real estate had a positive real return, amplified if holding a mortgage. Non-US stocks had a positive real return.

Mr. Bogle does mention that large cap US companies now derive half their revenue from overseas, which was not true in the 1970's, but it was by no means zero then either. Globalization has also increased US consumption from overseas, and the US equity market has less sector diversification than it used to. This means that US sector diversification does not align with US consumption. I believe that this is a non-trivial residual inflation risk for covering US retirement liabilities with US equities.

I would add that the increase in overseas revenue for US equities, and the high level of revenue from the US derived by non-US companies (Samsung, Toyota, TSMC ...) makes it very difficult to assess the currency exposure of equity portfolios today, whether US-only or globally diversified.

I do not know of a compelling argument to assume that inflation risk is adequately mitigated with a US-only equity portfolio. Because I'm not aware of Mr. Bogle ever discussing this point, his input on the matter is incomplete for the purposes of constructing a portfolio that mitigates all of the risks we prefer to address.

When TIPS or i-bonds have a positive real return, using them for a bond allocation would at least offset some of the risk. If you want to support even a 3% SWR, and hold 60% US stock and 40% i-bonds, you need a 7.5% real yield on the i-bonds if the stock portfolio has a zero real return. For a 4% SWR, the bond real yield needed is 10%.

But the portfolio recommendation that is the basis of this thread does not even include any inflation-indexing in the bond portfolio. The 2-fund portfolio recommended here is substantially overexposed to inflation risk in my view.
Last edited by Northern Flicker on Mon May 17, 2021 3:11 pm, edited 1 time in total.
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Re: Jack Bogle - Two Fund Portfolio

Post by seajay »

DB2 wrote: Mon May 17, 2021 2:10 pmIf the U.S. becomes a Japan situation (and there are some similarities already)
Comparing a Japanese investor in 50/50 Japanese Stock/US stock to that of a US investor in 50/50 US/Global excluding US, 1986 to 2019 inclusive inflation adjusted (domestic inflation rates) ...

Image

... and more than 'some similarities already'.

Yes the Yen based investor saw a 1% lower annualised real gain compared to the US$ investor, but the cost of buying from the US near halved. Dec 1985 and US$ bought 203 Yen, Dec 2019 and US$ bought 109 Yen.

For a Japanese investor solely in domestic large cap stock then they saw fantastic 1980's gains when many firms rose to become global household names, Yamaha, Toshiba, Sony ...etc. Absolute giants. That then faltered in the 1990's, but in being so large even after they'd halved or more in value they still remained the largest/dominant stocks and acted as a broad index drag factor, such that from 1986 to the end of 2019 there was a lot of zigzagging around but that broadly achieved 0% annualised real.
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Re: Jack Bogle - Two Fund Portfolio

Post by Northern Flicker »

Be sure to include the Japan real estate bubble in the analysis. At one time, the total value in USD of real estate in Tokyo exceeded the total value of all real estate in the US.
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Re: Jack Bogle - Two Fund Portfolio

Post by FIREchief »

Nathan Drake wrote: Mon May 17, 2021 2:00 pm
FIREchief wrote: Mon May 17, 2021 1:48 pm
Da5id wrote: Mon May 17, 2021 12:12 pm Why chase recent US outperformance predicting it will go on into the indefinite future?
Is it "chasing" if a person has been 100% US for decades? Or, is it just sticking with the horse that got you "here." 8-)
It’s getting lucky over a certain period, and probably better off adjusting the allocation to something more diversified going forward
You may be right, but I'm too old to move to a different horse. If my current horse lags for 10 years, I'll still win the race. I don't buy any of the crap out there about valuations. They're comparing our tech heavy US market with foreign markets that are more heavy in traditional sectors. Manufacturing has always had lower P/Es than high tech. It's apples and oranges. Plus, I don't trust the socialist/communist foreign governments to provide more healthy environments for capitalism than what we have in the US. Invest as you will. I'll stick with 100% US TMI thank you! :beer

Diversification is something, but it ain't everything. I'm not diversifying into Crypto. I'm not diversifying into commodities. I'm not diversifying into my brother in law's crazy small business schemes. I did diversify from S&P 500 to US TMI. That's where it ends. :D
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Re: Jack Bogle - Two Fund Portfolio

Post by Da5id »

FIREchief wrote: Mon May 17, 2021 4:48 pm
Nathan Drake wrote: Mon May 17, 2021 2:00 pm
FIREchief wrote: Mon May 17, 2021 1:48 pm
Da5id wrote: Mon May 17, 2021 12:12 pm Why chase recent US outperformance predicting it will go on into the indefinite future?
Is it "chasing" if a person has been 100% US for decades? Or, is it just sticking with the horse that got you "here." 8-)
It’s getting lucky over a certain period, and probably better off adjusting the allocation to something more diversified going forward
You may be right, but I'm too old to move to a different horse. If my current horse lags for 10 years, I'll still win the race. I don't buy any of the crap out there about valuations. They're comparing our tech heavy US market with foreign markets that are more heavy in traditional sectors. Manufacturing has always had lower P/Es than high tech. It's apples and oranges. Plus, I don't trust the socialist/communist foreign governments to provide more healthy environments for capitalism than what we have in the US. Invest as you will. I'll stick with 100% US TMI thank you! :beer

Diversification is something, but it ain't everything. I'm not diversifying into Crypto. I'm not diversifying into commodities. I'm not diversifying into my brother in law's crazy small business schemes. I did diversify from S&P 500 to US TMI. That's where it ends. :D
US valuations have doubled relative to Int'l in the past 10 years. Do you think that trend will continue?
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Re: Jack Bogle - Two Fund Portfolio

Post by FIREchief »

Da5id wrote: Mon May 17, 2021 4:50 pm
FIREchief wrote: Mon May 17, 2021 4:48 pm
Nathan Drake wrote: Mon May 17, 2021 2:00 pm
FIREchief wrote: Mon May 17, 2021 1:48 pm
Da5id wrote: Mon May 17, 2021 12:12 pm Why chase recent US outperformance predicting it will go on into the indefinite future?
Is it "chasing" if a person has been 100% US for decades? Or, is it just sticking with the horse that got you "here." 8-)
It’s getting lucky over a certain period, and probably better off adjusting the allocation to something more diversified going forward
You may be right, but I'm too old to move to a different horse. If my current horse lags for 10 years, I'll still win the race. I don't buy any of the crap out there about valuations. They're comparing our tech heavy US market with foreign markets that are more heavy in traditional sectors. Manufacturing has always had lower P/Es than high tech. It's apples and oranges. Plus, I don't trust the socialist/communist foreign governments to provide more healthy environments for capitalism than what we have in the US. Invest as you will. I'll stick with 100% US TMI thank you! :beer

Diversification is something, but it ain't everything. I'm not diversifying into Crypto. I'm not diversifying into commodities. I'm not diversifying into my brother in law's crazy small business schemes. I did diversify from S&P 500 to US TMI. That's where it ends. :D
US valuations have doubled relative to Int'l in the past 10 years. Do you think that trend will continue?
I have no idea, nor do I care.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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Re: Jack Bogle - Two Fund Portfolio

Post by Nathan Drake »

FIREchief wrote: Mon May 17, 2021 4:48 pm
Nathan Drake wrote: Mon May 17, 2021 2:00 pm
FIREchief wrote: Mon May 17, 2021 1:48 pm
Da5id wrote: Mon May 17, 2021 12:12 pm Why chase recent US outperformance predicting it will go on into the indefinite future?
Is it "chasing" if a person has been 100% US for decades? Or, is it just sticking with the horse that got you "here." 8-)
It’s getting lucky over a certain period, and probably better off adjusting the allocation to something more diversified going forward
You may be right, but I'm too old to move to a different horse. If my current horse lags for 10 years, I'll still win the race. I don't buy any of the crap out there about valuations. They're comparing our tech heavy US market with foreign markets that are more heavy in traditional sectors. Manufacturing has always had lower P/Es than high tech. It's apples and oranges. Plus, I don't trust the socialist/communist foreign governments to provide more healthy environments for capitalism than what we have in the US. Invest as you will. I'll stick with 100% US TMI thank you! :beer

Diversification is something, but it ain't everything. I'm not diversifying into Crypto. I'm not diversifying into commodities. I'm not diversifying into my brother in law's crazy small business schemes. I did diversify from S&P 500 to US TMI. That's where it ends. :D
25-30% is tech related, it doesn’t explain valuations as a whole

Furthermore, a huge portion of EM is also in tech and yet it has about half the level of valuations

Not knowing how old or what % you have in equities, but even a smallish allocation to international could help quite a bit in terms of mitigating risk
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Re: Jack Bogle - Two Fund Portfolio

Post by FIREchief »

Nathan Drake wrote: Mon May 17, 2021 5:00 pm 25-30% is tech related, it doesn’t explain valuations as a whole
Sure, but between that and our more capitalism-friendly government, I have no problem ignoring the differences in valuations between US and foreign.
Furthermore, a huge portion of EM is also in tech and yet it has about half the level of valuations
"tech" is a broad, ill-defined term. EM ain't FAANG.
Not knowing how old or what % you have in equities, but even a smallish allocation to international could help quite a bit in terms of mitigating risk
Thanks, but I'm not concerned with the "risks" of investing in US TMI. Never have been. Never will be.

That said, and back on topic..... I use an LMP/RP asset allocation strategy and my LMP is 100% TIPS. Risk doesn't really enter into that equation for myself and DW. 8-)
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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Re: Jack Bogle - Two Fund Portfolio

Post by Da5id »

FIREchief wrote: Mon May 17, 2021 4:52 pm
Da5id wrote: Mon May 17, 2021 4:50 pm
FIREchief wrote: Mon May 17, 2021 4:48 pm
Nathan Drake wrote: Mon May 17, 2021 2:00 pm
FIREchief wrote: Mon May 17, 2021 1:48 pm

Is it "chasing" if a person has been 100% US for decades? Or, is it just sticking with the horse that got you "here." 8-)
It’s getting lucky over a certain period, and probably better off adjusting the allocation to something more diversified going forward
You may be right, but I'm too old to move to a different horse. If my current horse lags for 10 years, I'll still win the race. I don't buy any of the crap out there about valuations. They're comparing our tech heavy US market with foreign markets that are more heavy in traditional sectors. Manufacturing has always had lower P/Es than high tech. It's apples and oranges. Plus, I don't trust the socialist/communist foreign governments to provide more healthy environments for capitalism than what we have in the US. Invest as you will. I'll stick with 100% US TMI thank you! :beer

Diversification is something, but it ain't everything. I'm not diversifying into Crypto. I'm not diversifying into commodities. I'm not diversifying into my brother in law's crazy small business schemes. I did diversify from S&P 500 to US TMI. That's where it ends. :D
US valuations have doubled relative to Int'l in the past 10 years. Do you think that trend will continue?
I have no idea, nor do I care.
That theory went badly in Japan when values got extreme, but good luck. Worth saying I don't do tactical allocations based on valuations, but think they mean something anyway.
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Re: Jack Bogle - Two Fund Portfolio

Post by Nathan Drake »

FIREchief wrote: Mon May 17, 2021 5:06 pm
Nathan Drake wrote: Mon May 17, 2021 5:00 pm 25-30% is tech related, it doesn’t explain valuations as a whole
Sure, but between that and our more capitalism-friendly government, I have no problem ignoring the differences in valuations between US and foreign.
Furthermore, a huge portion of EM is also in tech and yet it has about half the level of valuations
"tech" is a broad, ill-defined term. EM ain't FAANG.
Not knowing how old or what % you have in equities, but even a smallish allocation to international could help quite a bit in terms of mitigating risk
Thanks, but I'm not concerned with the "risks" of investing in US TMI. Never have been. Never will be.

That said, and back on topic..... I use an LMP/RP asset allocation strategy and my LMP is 100% TIPS. Risk doesn't really enter into that equation for myself and DW. 8-)
Top holdings in EM are very similar to Asian versions of FAANG
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Re: Jack Bogle - Two Fund Portfolio

Post by abuss368 »

FIREchief wrote: Mon May 17, 2021 4:48 pm
I don't buy any of the crap out there about valuations. They're comparing our tech heavy US market with foreign markets that are more heavy in traditional sectors. Manufacturing has always had lower P/Es than high tech. It's apples and oranges. Plus, I don't trust the socialist/communist foreign governments to provide more healthy environments for capitalism than what we have in the US. Invest as you will. I'll stick with 100% US TMI thank you! :beer

Diversification is something, but it ain't everything. I'm not diversifying into Crypto. I'm not diversifying into commodities. I'm not diversifying into my brother in law's crazy small business schemes. I did diversify from S&P 500 to US TMI. That's where it ends. :D
Hi FIREchief -

Your post speaks to me and is very well said. :beer

Hope you are well.
Tony
John C. Bogle: “Simplicity is the master key to financial success."
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Re: Jack Bogle - Two Fund Portfolio

Post by FIREchief »

abuss368 wrote: Mon May 17, 2021 5:44 pm
FIREchief wrote: Mon May 17, 2021 4:48 pm
I don't buy any of the crap out there about valuations. They're comparing our tech heavy US market with foreign markets that are more heavy in traditional sectors. Manufacturing has always had lower P/Es than high tech. It's apples and oranges. Plus, I don't trust the socialist/communist foreign governments to provide more healthy environments for capitalism than what we have in the US. Invest as you will. I'll stick with 100% US TMI thank you! :beer

Diversification is something, but it ain't everything. I'm not diversifying into Crypto. I'm not diversifying into commodities. I'm not diversifying into my brother in law's crazy small business schemes. I did diversify from S&P 500 to US TMI. That's where it ends. :D
Hi FIREchief -

Your post speaks to me and is very well said. :beer

Hope you are well.
Tony
8-)
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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Re: Jack Bogle - Two Fund Portfolio

Post by FIREchief »

Nathan Drake wrote: Mon May 17, 2021 5:31 pm
FIREchief wrote: Mon May 17, 2021 5:06 pm
Nathan Drake wrote: Mon May 17, 2021 5:00 pm 25-30% is tech related, it doesn’t explain valuations as a whole
Sure, but between that and our more capitalism-friendly government, I have no problem ignoring the differences in valuations between US and foreign.
Furthermore, a huge portion of EM is also in tech and yet it has about half the level of valuations
"tech" is a broad, ill-defined term. EM ain't FAANG.
Not knowing how old or what % you have in equities, but even a smallish allocation to international could help quite a bit in terms of mitigating risk
Thanks, but I'm not concerned with the "risks" of investing in US TMI. Never have been. Never will be.

That said, and back on topic..... I use an LMP/RP asset allocation strategy and my LMP is 100% TIPS. Risk doesn't really enter into that equation for myself and DW. 8-)
Top holdings in EM are very similar to Asian versions of FAANG
Really? They have an Amazon in a third world country? And no, I'm not talking about the river.... :P
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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Re: Jack Bogle - Two Fund Portfolio

Post by FIREchief »

Da5id wrote: Mon May 17, 2021 5:12 pm
FIREchief wrote: Mon May 17, 2021 4:52 pm
Da5id wrote: Mon May 17, 2021 4:50 pm
FIREchief wrote: Mon May 17, 2021 4:48 pm
Nathan Drake wrote: Mon May 17, 2021 2:00 pm

It’s getting lucky over a certain period, and probably better off adjusting the allocation to something more diversified going forward
You may be right, but I'm too old to move to a different horse. If my current horse lags for 10 years, I'll still win the race. I don't buy any of the crap out there about valuations. They're comparing our tech heavy US market with foreign markets that are more heavy in traditional sectors. Manufacturing has always had lower P/Es than high tech. It's apples and oranges. Plus, I don't trust the socialist/communist foreign governments to provide more healthy environments for capitalism than what we have in the US. Invest as you will. I'll stick with 100% US TMI thank you! :beer

Diversification is something, but it ain't everything. I'm not diversifying into Crypto. I'm not diversifying into commodities. I'm not diversifying into my brother in law's crazy small business schemes. I did diversify from S&P 500 to US TMI. That's where it ends. :D
US valuations have doubled relative to Int'l in the past 10 years. Do you think that trend will continue?
I have no idea, nor do I care.
That theory went badly in Japan when values got extreme, but good luck. Worth saying I don't do tactical allocations based on valuations, but think they mean something anyway.
Other than some ongoing (minor) 401k contributions, we bough our last meaningful stocks years ago. Up, down, all around.... It doesn't much matter at this point. I'm not buying (or selling much) at a peak so why would I care about valuations? Market goes up. Market goes down. Long live the US market! :beer
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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Re: Jack Bogle - Two Fund Portfolio

Post by Da5id »

FIREchief wrote: Mon May 17, 2021 8:39 pm Other than some ongoing (minor) 401k contributions, we bough our last meaningful stocks years ago. Up, down, all around.... It doesn't much matter at this point. I'm not buying (or selling much) at a peak so why would I care about valuations? Market goes up. Market goes down. Long live the US market! :beer
I'm in a similar position, but no longer buying other than rebalancing (and HSA funding and such) as I early retired a few years. I see owning int'l as damping volatility some and as hedging against US underforming Int'l for a sustained period, which I gather you think somewhere between unlikely and inconceivable. If US overperforms forever, well that is 60% of my stocks. If Int'l overperforms I'm covered there. If neither does well, hey I have bonds including some TIPS for that (and some commercial real estate for that matter). I prefer to be diversified against what I think are reasonable risks
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Re: Jack Bogle - Two Fund Portfolio

Post by FIREchief »

Da5id wrote: Mon May 17, 2021 8:56 pm
FIREchief wrote: Mon May 17, 2021 8:39 pm Other than some ongoing (minor) 401k contributions, we bough our last meaningful stocks years ago. Up, down, all around.... It doesn't much matter at this point. I'm not buying (or selling much) at a peak so why would I care about valuations? Market goes up. Market goes down. Long live the US market! :beer
I'm in a similar position, but no longer buying other than rebalancing (and HSA funding and such) as I early retired a few years. I see owning int'l as damping volatility some and as hedging against US underforming Int'l for a sustained period, which I gather you think somewhere between unlikely and inconceivable.
Not at all. I readily admit that I don't know anything. Total US has served me very well and I have no desire to deviate from my "course." Certainly, it will underperform at some point, but who knows when? :confused
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
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Re: Jack Bogle - Two Fund Portfolio

Post by Northern Flicker »

FIREchief wrote: Mon May 17, 2021 8:36 pm
Nathan Drake wrote: Mon May 17, 2021 5:31 pm
FIREchief wrote: Mon May 17, 2021 5:06 pm
Nathan Drake wrote: Mon May 17, 2021 5:00 pm 25-30% is tech related, it doesn’t explain valuations as a whole
Sure, but between that and our more capitalism-friendly government, I have no problem ignoring the differences in valuations between US and foreign.
Furthermore, a huge portion of EM is also in tech and yet it has about half the level of valuations
"tech" is a broad, ill-defined term. EM ain't FAANG.
Not knowing how old or what % you have in equities, but even a smallish allocation to international could help quite a bit in terms of mitigating risk
Thanks, but I'm not concerned with the "risks" of investing in US TMI. Never have been. Never will be.

That said, and back on topic..... I use an LMP/RP asset allocation strategy and my LMP is 100% TIPS. Risk doesn't really enter into that equation for myself and DW. 8-)
Top holdings in EM are very similar to Asian versions of FAANG
Really? They have an Amazon in a third world country? And no, I'm not talking about the river.... :P
Yes, it's called Alibaba.

http://quotes.morningstar.com/chart/fun ... 2%3A955%7D
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Re: Jack Bogle - Two Fund Portfolio

Post by abuss368 »

FIREchief wrote: Mon May 17, 2021 9:24 pm
Da5id wrote: Mon May 17, 2021 8:56 pm
FIREchief wrote: Mon May 17, 2021 8:39 pm Other than some ongoing (minor) 401k contributions, we bough our last meaningful stocks years ago. Up, down, all around.... It doesn't much matter at this point. I'm not buying (or selling much) at a peak so why would I care about valuations? Market goes up. Market goes down. Long live the US market! :beer
I'm in a similar position, but no longer buying other than rebalancing (and HSA funding and such) as I early retired a few years. I see owning int'l as damping volatility some and as hedging against US underforming Int'l for a sustained period, which I gather you think somewhere between unlikely and inconceivable.
Not at all. I readily admit that I don't know anything. Total US has served me very well and I have no desire to deviate from my "course." Certainly, it will underperform at some point, but who knows when? :confused
It is most important to be able to stay the course and also to sleep well at night. You have found what work best for YOU! This is key.

Tony
John C. Bogle: “Simplicity is the master key to financial success."
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Re: Jack Bogle - Two Fund Portfolio

Post by Ferdinand2014 »

abuss368 wrote: Tue May 18, 2021 6:37 am
FIREchief wrote: Mon May 17, 2021 9:24 pm
Da5id wrote: Mon May 17, 2021 8:56 pm
FIREchief wrote: Mon May 17, 2021 8:39 pm Other than some ongoing (minor) 401k contributions, we bough our last meaningful stocks years ago. Up, down, all around.... It doesn't much matter at this point. I'm not buying (or selling much) at a peak so why would I care about valuations? Market goes up. Market goes down. Long live the US market! :beer
I'm in a similar position, but no longer buying other than rebalancing (and HSA funding and such) as I early retired a few years. I see owning int'l as damping volatility some and as hedging against US underforming Int'l for a sustained period, which I gather you think somewhere between unlikely and inconceivable.
Not at all. I readily admit that I don't know anything. Total US has served me very well and I have no desire to deviate from my "course." Certainly, it will underperform at some point, but who knows when? :confused
It is most important to be able to stay the course and also to sleep well at night. You have found what work best for YOU! This is key.

Tony
True. In the end we need to focus on the things we can control - costs (including taxes, transactions, expense ratios), savings rate and sticking with a plan. The best plan is likely the plan that we can stick with. Most topics on this forum that are vigorously debated are the ones that will only be known to be correct in hindsight as we can only rely on backtesting and human behavior.
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Re: Jack Bogle - Two Fund Portfolio

Post by Da5id »

abuss368 wrote: Tue May 18, 2021 6:37 am It is most important to be able to stay the course and also to sleep well at night. You have found what work best for YOU! This is key.
If 100% US lets you "sleep well at night" during the current period of US outperformance, it is rather hard to understand why 100% US wouldn't cause insomnia during a future prolonged period of international outperformance. People with such insomnia issues probably would be better off paying less attention to the relative performance of the mixture of holdings in their equities allocation, perhaps by buying all-in-one funds. If paying too close attention, someone owning 100% US could get insomnia over the poor individual performing stocks VTI owns, or the poorly performing US sectors that they are investing in.

Note that if someone wants to stay the course and remain all US (as they always have), that is one thing. If one removes international, not staying the course, in order to "sleep well at night", they seem like they could easily have the troubles I mentioned above.
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Re: Jack Bogle - Two Fund Portfolio

Post by NiceUnparticularMan »

Da5id wrote: Tue May 18, 2021 6:59 am
abuss368 wrote: Tue May 18, 2021 6:37 am It is most important to be able to stay the course and also to sleep well at night. You have found what work best for YOU! This is key.
If 100% US lets you "sleep well at night" during the current period of US outperformance, it is rather hard to understand why 100% US wouldn't cause insomnia during a future prolonged period of international outperformance. People with such insomnia issues probably would be better off paying less attention to the relative performance of the mixture of holdings in their equities allocation, perhaps by buying all-in-one funds. If paying too close attention, someone owning 100% US could get insomnia over the poor individual performing stocks VTI owns, or the poorly performing US sectors that they are investing in.

Note that if someone wants to stay the course and remain all US (as they always have), that is one thing. If one removes international, not staying the course, in order to "sleep well at night", they seem like they could easily have the troubles I mentioned above.
Indeed.

And I am troubled when I see people here effectively say a combination of that they anticipate that going to, or starting with, all-U.S. will be something they can stick with, and that they also expect all-U.S. to continue to do as well or better anyway.

It would be more credible to me if they said something like, "I expect all-U.S. to do worse, but I think it will be easier to stick with anyway." Or at least, "I acknowledge at least a 50% chance that all-U.S. will do worse, but I think it will be easier to stick with anyway." Because then they are really contemplating the sort of pressure they will feel to change their minds if in fact all-U.S. does worse.

But when they imagine all-U.S. doing better anyway, they are not in fact really testing whether all-U.S. will be something they can stick with in the event their expectation proves wrong.

Now I understand some investors here may have been all-U.S. so long they may have really tested this, not just as a hypothetical. So, they may have watched their all-U.S. portfolio lag in the 2000-2009 period, or 1980-89 period, or so on, and had no problems sticking with it. And I don't see much reason to quarrel with such people.

But, I do think such people should be very hesitant to assume what worked for them will work for others today. Things have changed a lot over the years, and I think between the new investment vehicles available, new research being done, the rise of the Internet, changing norms, and on and on, the social and psychological pressure people will feel after a period of lagging U.S. performance in the future will not be the same as what might have happened in the past.

Again, that is not to suggest those people need to change their own plans. I just think they just should be very, very cautious about promoting what worked for them to others who will be operating in a different context.
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Re: Jack Bogle - Two Fund Portfolio

Post by goonie »

I asked the following a few pages back and didn't get a response.

goonie wrote: Mon May 10, 2021 6:57 pm
abuss368 wrote: Mon May 10, 2021 6:35 pm Bogleheads -

An excellent article “Jack Bogle: My new winning portfolio strategy” discussing 60% to Total Stock and 40% to Total Bond.

In my opinion this is key:

4. Bogle believes that if you make the 'simple' portfolio choices, you'll spend a lot less time worrying.

The genius of Bogle's portfolio, for him, is its simplicity. It's easy for him to track and understand, and therefore stick to. You might like the challenge of trying to maximize your returns by adding diversification or rebalancing — just be sure you can stick to what you decided and won't sell in a panic or buy in greed. The fundamental thing you want from your portfolio is a sense that it's the right choice for you over the long term.


Enjoy!
Tony
You like to mention often the importance of being able to stick to your allocation. Considering that you dropped International in 2016 after 7 years of US outperformance and that, in the 5 years since, you haven't been through a prolonged period of US underperformance...how are you so certain that you're going to be able to stick with your new allocation?

Also, how is Total World more complicated than Total US?
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Re: Jack Bogle - Two Fund Portfolio

Post by seajay »

Spun the other way around, bonds.

"Bonds" might be T-Bills, 10 year treasury bullet, 1 year/20 year treasury barbell, corporate bonds, foreign bonds .. etc, but let's just look at one who chose to 50/50 stock/bond, holding the entire set of bonds (TBM), and another who opted for 50/50 stock and 10 year Treasury.

Over 1 year stock/TBM is ahead, over 3 years stock/10 year won, over 5 years stock/TBM won, over 10 years stock/10 year won. The differences were relatively small, could be generally summarized as being comparable, so just go with what feels the most comfortable for you or that is the more cost/tax efficient. One might opt to hold a 10 year ladder of Treasury bonds for instance, rebalancing/withdrawing as each bond matures. No fund fees, no foreign withholding taxes. Over the last 10 years 50/50 Total Stock VTI, Total Bond VBMFX has yielded the near exact same total gross gain as 50/50 Berkshire Hathaway/10 year Treasury.
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Re: Jack Bogle - Two Fund Portfolio

Post by spdoublebass »

abuss368 wrote: Tue May 18, 2021 6:37 am
FIREchief wrote: Mon May 17, 2021 9:24 pm
Da5id wrote: Mon May 17, 2021 8:56 pm
FIREchief wrote: Mon May 17, 2021 8:39 pm Other than some ongoing (minor) 401k contributions, we bough our last meaningful stocks years ago. Up, down, all around.... It doesn't much matter at this point. I'm not buying (or selling much) at a peak so why would I care about valuations? Market goes up. Market goes down. Long live the US market! :beer
I'm in a similar position, but no longer buying other than rebalancing (and HSA funding and such) as I early retired a few years. I see owning int'l as damping volatility some and as hedging against US underforming Int'l for a sustained period, which I gather you think somewhere between unlikely and inconceivable.
Not at all. I readily admit that I don't know anything. Total US has served me very well and I have no desire to deviate from my "course." Certainly, it will underperform at some point, but who knows when? :confused
It is most important to be able to stay the course and also to sleep well at night. You have found what work best for YOU! This is key.

Tony
Do you feel you are an example of an investor that stays the course?
I'm trying to think, but nothing happens
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Re: Jack Bogle - Two Fund Portfolio

Post by LadyGeek »

I removed several off-topic posts. As a reminder, see: General Etiquette
At all times we must conduct ourselves in a respectful manner to other posters.
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Re: Jack Bogle - Two Fund Portfolio

Post by Northern Flicker »

I can think of all sorts of plausible, but different outcomes of various events of the last year and a half that may have led us to having a different discussion right now about idiosyncratic risk of individual countries.
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Re: Jack Bogle - Two Fund Portfolio

Post by 000 »

The "Two Fund Portfolio" has been in a long-term secular bull market for the last 40 years, after the 1970s stagflation was contained.

Both US stocks and US bonds have done exceptionally over that time period. Investors would be wise to realize this was a fairly unusual period.

This can't continue forever.

We can be reasonably sure that a sustained period of rising rates will end the Two Fund bull market. And not just briefly, like during the fairly tame bear markets we've seen recently. The underlying forces that caused the security returns of the last 40 years may not recur.

We can also be reasonably sure that something even mildly "bad" happening to one particular country could end the dominance of the Two Fund Portfolio. The usual responses to this point are some drivel about "meteors from outer space" or "nuclear war", but a catastrophe of that magnitude is not what we're talking about. All that is required is for world sentiment towards the US and its institutions to change. People around the world use the US stock market and USD as safe havens, so they have a premium built in. If you live in the US, you get doubly exposed to the upside and the downside of this effect.
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Re: Jack Bogle - Two Fund Portfolio

Post by mrspock »

goonie wrote: Mon May 10, 2021 6:57 pm
abuss368 wrote: Mon May 10, 2021 6:35 pm Bogleheads -

An excellent article “Jack Bogle: My new winning portfolio strategy” discussing 60% to Total Stock and 40% to Total Bond.

In my opinion this is key:

4. Bogle believes that if you make the 'simple' portfolio choices, you'll spend a lot less time worrying.

The genius of Bogle's portfolio, for him, is its simplicity. It's easy for him to track and understand, and therefore stick to. You might like the challenge of trying to maximize your returns by adding diversification or rebalancing — just be sure you can stick to what you decided and won't sell in a panic or buy in greed. The fundamental thing you want from your portfolio is a sense that it's the right choice for you over the long term.


Enjoy!
Tony
You like to mention often the importance of being able to stick to your allocation. Considering that you dropped International in 2016 after 7 years of US outperformance and that, in the 5 years since, you haven't been through a prolonged period of US underperformance...how are you so certain that you're going to be able to stick with your new allocation?

Also, how is Total World more complicated than Total US?
:shock: Read what you wrote again to yourself, maybe aloud.

It reminds me of engineers who make complex unworkable designs, then proceed to draw a box around the complexity give it a clever name, and say “See… look it’s simple!”
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Re: Jack Bogle - Two Fund Portfolio

Post by Da5id »

mrspock wrote: Sat May 22, 2021 5:14 pm
goonie wrote: Mon May 10, 2021 6:57 pm You like to mention often the importance of being able to stick to your allocation. Considering that you dropped International in 2016 after 7 years of US outperformance and that, in the 5 years since, you haven't been through a prolonged period of US underperformance...how are you so certain that you're going to be able to stick with your new allocation?

Also, how is Total World more complicated than Total US?
:shock: Read what you wrote again to yourself, maybe aloud.

It reminds me of engineers who make complex unworkable designs, then proceed to draw a box around the complexity give it a clever name, and say “See… look it’s simple!”
I'm not clear on your point. Owning two funds, a bond fund and a stock fund, is the same complexity for the owner regardless of which particular stock fund is owned?!?
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Re: Jack Bogle - Two Fund Portfolio

Post by goonie »

Da5id wrote: Sat May 22, 2021 9:06 pm
mrspock wrote: Sat May 22, 2021 5:14 pm
goonie wrote: Mon May 10, 2021 6:57 pm
Also, how is Total World more complicated than Total US?
:shock: Read what you wrote again to yourself, maybe aloud.

It reminds me of engineers who make complex unworkable designs, then proceed to draw a box around the complexity give it a clever name, and say “See… look it’s simple!”
I'm not clear on your point. Owning two funds, a bond fund and a stock fund, is the same complexity for the owner regardless of which particular stock fund is owned?!?
Exactly. I asked that question in response to the repeated claims that since owning 2 funds is simpler than owning 3 funds, owning a US stock fund is simpler than owning both a US fund and an ex-US fund.

If someone feels that owning 3 funds is just too overwhelming and stressful, they can cut down to 2 by going with a global stock fund. They don't have to sacrifice ex-US at the altar of marginal simplicity.
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