WisdomTree 90/60 US Efficient Core Fund [NTSX] (formerly US Balanced Fund)

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muffins14
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by muffins14 »

If the worst-case scenario is 0.065%, that’s not bad. You’ll likely not get the worst of both bid and ask at every trade you make, and even if you did, it’s in the noise relative to daily price movements
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by jakobkeys »

I'm considering NTSX as a significant holding from a windfall I'm investing, i.e., held in taxable, majority of my net worth. It seems like the right way to think about it is as a lower-volatility/higher-upside replacement for VTI/VOO — obviously not that it will always outperform (current conditions being a good example), but over the long run.

I'm curious if other NTSX-holders are using it this way, or how they think about NTSX in an Bogldeheads portfolio? If my AA would normally be 70/20/10 US/Intl/Bonds (I'm in my accumulation phase), would folks just use NTSX for the US piece, or is there reason that I should think about still having plain VTI?
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kevinf
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by kevinf »

jakobkeys wrote: Mon Mar 22, 2021 9:24 pm I'm considering NTSX as a significant holding from a windfall I'm investing, i.e., held in taxable... think about it is as a lower-volatility/higher-upside replacement for VTI.. I'm curious if other NTSX-holders are using it this way,...
That's pretty much how I'm using it for now. Also as a holding fund in my Roth until I have enough to justify the purchase fee for a conversion to PSLDX.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by ljford7 »

jakobkeys wrote: Mon Mar 22, 2021 9:24 pm I'm considering NTSX as a significant holding from a windfall I'm investing, i.e., held in taxable, majority of my net worth. It seems like the right way to think about it is as a lower-volatility/higher-upside replacement for VTI/VOO — obviously not that it will always outperform (current conditions being a good example), but over the long run.

I'm curious if other NTSX-holders are using it this way, or how they think about NTSX in an Bogldeheads portfolio? If my AA would normally be 70/20/10 US/Intl/Bonds (I'm in my accumulation phase), would folks just use NTSX for the US piece, or is there reason that I should think about still having plain VTI?
I hold it as part of my US stock allocation (I also hold it in taxable and IRA). I still hold some VOO, just for the reason that I like to cap how much NTSX and PSLDX I have in my total portfolio. The remainder goes to VOO (it is a small amount, but still serves it purpose).
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by Kal1981 »

What are the risk of PSLDX? I understand it’s leveraged with underlying in S&P500 and treasuries. Does it mean in a down market, the losses are multiplied? So if S&P 500 is down 20%, PSLDX will be down 35%?
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by kevinf »

Kal1981 wrote: Sun Mar 28, 2021 4:34 pm What are the risk of PSLDX? I understand it’s leveraged with underlying in S&P500 and treasuries. Does it mean in a down market, the losses are multiplied? So if S&P 500 is down 20%, PSLDX will be down 35%?
Why not 100% PSLDX?
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by tj »

Kal1981 wrote: Sun Mar 28, 2021 4:34 pm What are the risk of PSLDX? I understand it’s leveraged with underlying in S&P500 and treasuries. Does it mean in a down market, the losses are multiplied? So if S&P 500 is down 20%, PSLDX will be down 35%?
That fund does not use treasuries. It's a much riskier fund than NTSX.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by DMoogle »

Simplest way to think of NTSX is 90% stock exposure + 60% bond exposure. Simplest way to think of PSLDX is 100% stock exposure + 100% bond exposure. It's not perfect, but close enough.

If S&P500 drops 20% in a day, then NTSX will drop 18% and PSLDX will drop 20% assuming the bonds don't move for that day. But there are two important caveats:
  1. I specified "in a day" because I'm not sure how often they're rebalanced. If the S&P500 dropped 20% over the course of a week, and these funds are daily rebalanced, then their impact will not match the drop 1:1.
  2. Historically, bonds are negatively correlated with stocks. Meaning, if stocks have a good day, there's a good chance bonds will have a bad day, and vice versa. It's by no means guaranteed, and "good" vs. "bad" day means above/below their mean return.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by tj »

How do the movements in bond yields affect the leveraged treasury futures in NTSX?

On a day like today, stocks are up ~0.8%, bond yields are down almost 4%, but NTSX is lagging the stock index. How does this work, mathematically?
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by watchnerd »

The default portfolio in my signature has a pretty decent Sharpe ratio.

But...I'm not realizing it's full potential due to lack of leverage.

I think I can get pretty close to the same AA I currently have via:

60% VT = 36% NTSX / 24% VXUS

Comments / questions:

1. Some may ask, "why are you talking leverage when you have 10% cash?". Indeed. But there are other potential plans for that.

2. My current bond barbell, with the cash, has a weight duration of ~7.6. From what I can tell, the embedded Treasury futures of NTSX would raise my weighted duration to about 10. Correct me if wrong.

3. Splicing NTSX + VXUS is inelegant. But I thought I read somewhere that Wisdom Tree is making an international version of NTSX?
Global stocks, IG/HY bonds, gold & digital assets at market weights 75% / 19% / 6% || LMP: TIPS ladder
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by occambogle »

watchnerd wrote: Sat Apr 10, 2021 12:19 pm 3. Splicing NTSX + VXUS is inelegant. But I thought I read somewhere that Wisdom Tree is making an international version of NTSX?
I read that too somewhere and was looking yesterday to find the info again but now I can’t find it. Would be interested in it....
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by Mortgasm »

They merely registered tickers that appear to be International versions, but many times fun firms sit on these tickers for years. I do not believe there are any firm plans announced.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by watchnerd »

Mortgasm wrote: Sat Apr 10, 2021 12:30 pm They merely registered tickers that appear to be International versions, but many times fun firms sit on these tickers for years. I do not believe there are any firm plans announced.
occambogle wrote: Sat Apr 10, 2021 12:23 pm
watchnerd wrote: Sat Apr 10, 2021 12:19 pm 3. Splicing NTSX + VXUS is inelegant. But I thought I read somewhere that Wisdom Tree is making an international version of NTSX?
I read that too somewhere and was looking yesterday to find the info again but now I can’t find it. Would be interested in it....
I couldn't find it, either.

They're probably going to wait until International starts outperforming US before launching it.

At least, that's what I would do if I were in their marketing dept... ;)
Global stocks, IG/HY bonds, gold & digital assets at market weights 75% / 19% / 6% || LMP: TIPS ladder
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by corp_sharecropper »

watchnerd wrote: Sat Apr 10, 2021 12:55 pm
Mortgasm wrote: Sat Apr 10, 2021 12:30 pm They merely registered tickers that appear to be International versions, but many times fun firms sit on these tickers for years. I do not believe there are any firm plans announced.
occambogle wrote: Sat Apr 10, 2021 12:23 pm
watchnerd wrote: Sat Apr 10, 2021 12:19 pm 3. Splicing NTSX + VXUS is inelegant. But I thought I read somewhere that Wisdom Tree is making an international version of NTSX?
I read that too somewhere and was looking yesterday to find the info again but now I can’t find it. Would be interested in it....
I couldn't find it, either.

They're probably going to wait until International starts outperforming US before launching it.

At least, that's what I would do if I were in their marketing dept... ;)
WisdomTree Emerging Markets Efficient Core Fund
https://www.sec.gov/Archives/edgar/data ... 85apos.htm


WisdomTree International Efficient Core Fund
https://www.sec.gov/Archives/edgar/data ... 85apos.htm
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watchnerd
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by watchnerd »

corp_sharecropper wrote: Sat Apr 10, 2021 1:38 pm
watchnerd wrote: Sat Apr 10, 2021 12:55 pm
Mortgasm wrote: Sat Apr 10, 2021 12:30 pm They merely registered tickers that appear to be International versions, but many times fun firms sit on these tickers for years. I do not believe there are any firm plans announced.
occambogle wrote: Sat Apr 10, 2021 12:23 pm
watchnerd wrote: Sat Apr 10, 2021 12:19 pm 3. Splicing NTSX + VXUS is inelegant. But I thought I read somewhere that Wisdom Tree is making an international version of NTSX?
I read that too somewhere and was looking yesterday to find the info again but now I can’t find it. Would be interested in it....
I couldn't find it, either.

They're probably going to wait until International starts outperforming US before launching it.

At least, that's what I would do if I were in their marketing dept... ;)
WisdomTree Emerging Markets Efficient Core Fund
https://www.sec.gov/Archives/edgar/data ... 85apos.htm


WisdomTree International Efficient Core Fund
https://www.sec.gov/Archives/edgar/data ... 85apos.htm
Thanks!
Global stocks, IG/HY bonds, gold & digital assets at market weights 75% / 19% / 6% || LMP: TIPS ladder
TheDoctor91
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by TheDoctor91 »

What would be the best way to model NTSX in portfoliocharts?

90 LCB 60 ITT and -50 BIL?
occambogle
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by occambogle »

TheDoctor91 wrote: Tue Apr 13, 2021 3:26 am What would be the best way to model NTSX in portfoliocharts?

90 LCB 60 ITT and -50 BIL?
Not sure about portfoliocharts but in PortfolioVisualizer this is the best simulation I have come across (from someone on this forum but I forget who originally):

NTSX-Simulation vs NTSX-Actual vs S&P500
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by keanoz »

Someone posted this earlier in the thread
https://www.portfoliovisualizer.com/bac ... tion9_3=10
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by thenextguy »

Someone posted this a while back in this thread or another thread.
I realize this is just a backtest approximation, but I tried to use it calculated expected return of this fund compared to 100% S&P 500 given current low rate environement.

The current yield on short-term fund is 0.43%. For intermediate 0.93%. And 1.98% for long-term fund. So the expected return on the bond portion is (0.43% * 20% + 0.93% * 20% + 1.98% * 20%) is 0.67%.

And since VOO is 100% S&P 500 and NTSX is 90% S&P 500, for the S&P 500 to return exactly the same as NTSX, it would have to return 6.67%.

Did I do this right? I realize that NTSX would have lower volatility, but I'm just looking at absolute return.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by EfficientInvestor »

thenextguy wrote: Fri Apr 23, 2021 9:20 am Someone posted this a while back in this thread or another thread.
I realize this is just a backtest approximation, but I tried to use it calculated expected return of this fund compared to 100% S&P 500 given current low rate environement.

The current yield on short-term fund is 0.43%. For intermediate 0.93%. And 1.98% for long-term fund. So the expected return on the bond portion is (0.43% * 20% + 0.93% * 20% + 1.98% * 20%) is 0.67%.

And since VOO is 100% S&P 500 and NTSX is 90% S&P 500, for the S&P 500 to return exactly the same as NTSX, it would have to return 6.67%.

Did I do this right? I realize that NTSX would have lower volatility, but I'm just looking at absolute return.
WisdomTree says the typical average bond duration of the fund is around 7 years. The current US 7 Year rate is around 1.25%, so let's use that as the assumed return on the bonds. The current borrowing rate (risk free rate) is somewhere between 0-0.25%. Let's assume 0.15% for the sake of the calculation. For stocks, let's assume a 6% return. If that's the case, here is the comparison:

S&P 500 Return = 6%

NTSX Return = 0.9*6% + 0.6*1.25% - 0.5*0.15% = 6.075%

So the expected returns are similar but the expected volatility of NTSX should theoretically be less than 100% stocks due to the diversification.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by tj »

I don't think you can use some math formula to predict what this fund will do. Right now, the 500 index is up 0.69%, NTSX is up 0.5%.
Tipro
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by Tipro »

thenextguy wrote: Fri Apr 23, 2021 9:20 am Someone posted this a while back in this thread or another thread.
I realize this is just a backtest approximation, but I tried to use it calculated expected return of this fund compared to 100% S&P 500 given current low rate environement.

The current yield on short-term fund is 0.43%. For intermediate 0.93%. And 1.98% for long-term fund. So the expected return on the bond portion is (0.43% * 20% + 0.93% * 20% + 1.98% * 20%) is 0.67%.

And since VOO is 100% S&P 500 and NTSX is 90% S&P 500, for the S&P 500 to return exactly the same as NTSX, it would have to return 6.67%.

Did I do this right? I realize that NTSX would have lower volatility, but I'm just looking at absolute return.
NTSX purchases treasury futures, not bonds. As such it's a play on interest rates only and pays no coupon.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by inbox788 »

tj wrote: Fri Apr 23, 2021 9:48 am I don't think you can use some math formula to predict what this fund will do. Right now, the 500 index is up 0.69%, NTSX is up 0.5%.
Not predict, but you can project how it will perform relative to a benchmark or what the fund is designed to do and calculate the tracking error.

https://www.google.com/finance/quote/NT ... SDAQ%3ABND
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by thenextguy »

Tipro wrote: Fri Apr 23, 2021 10:34 am
thenextguy wrote: Fri Apr 23, 2021 9:20 am Someone posted this a while back in this thread or another thread.
I realize this is just a backtest approximation, but I tried to use it calculated expected return of this fund compared to 100% S&P 500 given current low rate environement.

The current yield on short-term fund is 0.43%. For intermediate 0.93%. And 1.98% for long-term fund. So the expected return on the bond portion is (0.43% * 20% + 0.93% * 20% + 1.98% * 20%) is 0.67%.

And since VOO is 100% S&P 500 and NTSX is 90% S&P 500, for the S&P 500 to return exactly the same as NTSX, it would have to return 6.67%.

Did I do this right? I realize that NTSX would have lower volatility, but I'm just looking at absolute return.
NTSX purchases treasury futures, not bonds. As such it's a play on interest rates only and pays no coupon.
Yes, I know. But the returns are similar. (Did you miss the part of my post where I said it’s an approximation?) It’s an attempt to calculate expected return. If you’ve got a batter idea, I’m all ears.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by Tipro »

thenextguy wrote: Fri Apr 23, 2021 12:14 pm
Tipro wrote: Fri Apr 23, 2021 10:34 am
thenextguy wrote: Fri Apr 23, 2021 9:20 am Someone posted this a while back in this thread or another thread.
I realize this is just a backtest approximation, but I tried to use it calculated expected return of this fund compared to 100% S&P 500 given current low rate environement.

The current yield on short-term fund is 0.43%. For intermediate 0.93%. And 1.98% for long-term fund. So the expected return on the bond portion is (0.43% * 20% + 0.93% * 20% + 1.98% * 20%) is 0.67%.

And since VOO is 100% S&P 500 and NTSX is 90% S&P 500, for the S&P 500 to return exactly the same as NTSX, it would have to return 6.67%.

Did I do this right? I realize that NTSX would have lower volatility, but I'm just looking at absolute return.
NTSX purchases treasury futures, not bonds. As such it's a play on interest rates only and pays no coupon.
Yes, I know. But the returns are similar. (Did you miss the part of my post where I said it’s an approximation?) It’s an attempt to calculate expected return. If you’ve got a batter idea, I’m all ears.
I'm just not sure why, knowing futures don't pay interest, you would run your approximation using yield. Since we know the rough average duration of NTSX futures (seven or eight years I believe) and we know how bond values shift with changes in interest rates as a multiple of duration, I would start there and model future returns against how you think the bond market might play out.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by thenextguy »

Tipro wrote: Fri Apr 23, 2021 12:22 pm
thenextguy wrote: Fri Apr 23, 2021 12:14 pm
Tipro wrote: Fri Apr 23, 2021 10:34 am
thenextguy wrote: Fri Apr 23, 2021 9:20 am Someone posted this a while back in this thread or another thread.
I realize this is just a backtest approximation, but I tried to use it calculated expected return of this fund compared to 100% S&P 500 given current low rate environement.

The current yield on short-term fund is 0.43%. For intermediate 0.93%. And 1.98% for long-term fund. So the expected return on the bond portion is (0.43% * 20% + 0.93% * 20% + 1.98% * 20%) is 0.67%.

And since VOO is 100% S&P 500 and NTSX is 90% S&P 500, for the S&P 500 to return exactly the same as NTSX, it would have to return 6.67%.

Did I do this right? I realize that NTSX would have lower volatility, but I'm just looking at absolute return.
NTSX purchases treasury futures, not bonds. As such it's a play on interest rates only and pays no coupon.
Yes, I know. But the returns are similar. (Did you miss the part of my post where I said it’s an approximation?) It’s an attempt to calculate expected return. If you’ve got a batter idea, I’m all ears.
I'm just not sure why, knowing futures don't pay interest, you would run your approximation using yield.
Because it has done a very good job of tracking with actual returns of NTSX.
DMoogle
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by DMoogle »

The fact that futures don't pay interest directly means squat. The future interest payments (or rather, lack thereof) are baked into the price of the futures contract. So it's still a good proxy for the contract's expect value.

thenextguy, I think your approach is correct.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by corp_sharecropper »

Interesting/good news for those that like NTSX but also want international exposure. Jeremy Schwartz, EVP of research at WisdomTree, was giving a talk last week and though he isn't allowed to comment in certain detail about those two pending ETF filings we've discussed before (Developed & Emerging Efficient Core) he clearly indicated that they will in fact be launching, and soon. This is why NTSX is changing names to be part of this "Efficient Core" family of funds. He also said WisdomTree was quite happy, and almost pleasantly surprised, with the AUM that NTSX has garnered. Apparently there were initial doubts about the viability of a multi asset ETF like NTSX before launch (eg. too complex for retail to understand and disliked by advisors as it steps on their toes) so they're looking at more opportunities in the space due to the success of NTSX.

I got the impression that the timeline was <3 months out but no guarantees of course, just the impression I got.
Last edited by corp_sharecropper on Thu May 20, 2021 8:32 am, edited 1 time in total.
DMoogle
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by DMoogle »

corp_sharecropper wrote: Thu May 20, 2021 8:27 am Interesting/good news for those that like NTSX but also want international exposure. Jeremy Schwartz, EVP of research at WisdomTree, was giving a talk last week and though he isn't allowed to comment in certain detail about those two pending ETF filings we've discussed before (Developed & Emerging Efficient Core) he clearly indicated that they will in fact be launching, and soon. This is why NTSX is changing names to be part of this "Efficient Core" family of funds.

I got the impression that the timeline was <3 months out but no guarantees of course, just the impression I got.
Nice, that's awesome, thanks for sharing. Will probably shift out of VXUS and into whatever they launch.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by stormcrow »

corp_sharecropper wrote: Thu May 20, 2021 8:27 am I got the impression that the timeline was <3 months out but no guarantees of course, just the impression I got.
That is exciting, thanks for the update!
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by imak »

This seems to be the launch of 90/60 International and Emerging ETFs as per the blog posted today:
https://www.wisdomtree.com/blog/2021-05 ... ered-60-40

NTSI ETF:
https://www.wisdomtree.com/etfs/efficient-core/ntsi

NTSE ETF:
https://www.wisdomtree.com/etfs/efficient-core/ntse
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by snailderby »

That's great. Thanks for the update! Looks like NTSI will have an ER of 0.26% and NTSE will have an ER of 0.32%.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by stormcrow »

imak wrote: Thu May 20, 2021 9:12 am This seems to be the launch of 90/60 International and Emerging ETFs as per the blog posted today:
https://www.wisdomtree.com/blog/2021-05 ... ered-60-40

NTSI ETF:
https://www.wisdomtree.com/etfs/efficient-core/ntsi

NTSE ETF:
https://www.wisdomtree.com/etfs/efficient-core/ntse
Can confirm they are already live. Just bought some at TDA.
Polymorphic
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by Polymorphic »

Neat! Curious to see what allocation of NTSX/NTSI/NTSE/Non-Core other Bogleheads will choose.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by CulchaCity »

imak wrote: Thu May 20, 2021 9:12 am This seems to be the launch of 90/60 International and Emerging ETFs as per the blog posted today:
https://www.wisdomtree.com/blog/2021-05 ... ered-60-40

NTSI ETF:
https://www.wisdomtree.com/etfs/efficient-core/ntsi

NTSE ETF:
https://www.wisdomtree.com/etfs/efficient-core/ntse
Will these new etfs follow an index strategy?
DMoogle
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by DMoogle »

Polymorphic wrote: Thu May 20, 2021 9:43 am Neat! Curious to see what allocation of NTSX/NTSI/NTSE/Non-Core other Bogleheads will choose.
Thinking about slapping my whole taxable portfolio moving forward (not liquidating current holdings for tax reasons) in:
70% NTSX
20% NTSI
10% NTSE

Doesn't look like they're live in Interactive Brokers just yet.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by EfficientInvestor »

I have been eagerly anticipating the arrival of the international versions of the fund. I think the branding of them being the "efficient core" is quite appropriate as well. I have viewed NTSX as a "core" position that helps me move my portfolio towards more "efficiency" and now the international versions help to do that even better. These funds greatly improve the ability of investors to implement risk parity strategies in a more tax efficient manner since they hold the futures contracts inside the ETF wrapper. I would probably supplement the core funds with long term treasuries and gold. If I was targeting a 10% standard deviation portfolio, it would probably look something like this:

45% NTSX
15% NTSI
10% NTSE
15% TLT
15% GLDM
rchmx1
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by rchmx1 »

Ah, cool to see that these have launched. When do people plan to start moving funds into them? I see that they're live via Schwab, but not sure if there is a reason to wait until there's actual trading action going on. Right now it's mostly static.
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kevinf
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by kevinf »

Bummer, I was longing for a total world fund and holding a 1-fund portfolio! Still, it's nice to see that WisdomTree is all in on these funds. That takes a few concerns about longevity off the table for now.

I think I'll start building my NTSI allocation in my Roth, I like to keep my taxable as simple as possible.
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anon_investor
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by anon_investor »

EfficientInvestor wrote: Thu May 20, 2021 10:58 am I have been eagerly anticipating the arrival of the international versions of the fund. I think the branding of them being the "efficient core" is quite appropriate as well. I have viewed NTSX as a "core" position that helps me move my portfolio towards more "efficiency" and now the international versions help to do that even better. These funds greatly improve the ability of investors to implement risk parity strategies in a more tax efficient manner since they hold the futures contracts inside the ETF wrapper. I would probably supplement the core funds with long term treasuries and gold. If I was targeting a 10% standard deviation portfolio, it would probably look something like this:

45% NTSX
15% NTSI
10% NTSE
15% TLT
15% GLDM
How tax efficient has NTSX ended up being?
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by EfficientInvestor »

anon_investor wrote: Thu May 20, 2021 11:11 am How tax efficient has NTSX ended up being?
I was just looking at their total distributions from 2020. Overall distribution for the year was $0.335 against an average share price through 2020 of around $33. So let's call it a 1% yield, which is pretty tax efficient. Looks like a little less than 10% of the distribution was long term capital gains and the rest was ordinary income.

Charles Schwab has a tax cost ratio analysis that shows NTSX has had a lower tax cost ratio (0.45%) than SPY (0.65%) over the last year.

NTSX - https://www.schwab.com/research/etfs/qu ... lysis/ntsx
SPY - https://www.schwab.com/research/etfs/qu ... alysis/spy
Last edited by EfficientInvestor on Thu May 20, 2021 11:49 am, edited 1 time in total.
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anon_investor
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by anon_investor »

EfficientInvestor wrote: Thu May 20, 2021 11:21 am
anon_investor wrote: Thu May 20, 2021 11:11 am How tax efficient has NTSX ended up being?
I was just looking at their total distributions from 2020. Overall distribution for the year was $0.335 against an average share price through 2020 of around $33. So let's call it a 1% yield, which is pretty tax efficient. Looks like a little less than 10% of the distribution was long term capital gains and the rest was ordinary income.
I couldn't find it on the WisdomTree website, how much of those non-long term capital gains were from qualified dividends? I am just trying to understand how NTSX compares to VTI tax efficiency wise. I know after 2019, people mentioned that it had comparable tax efficiency to VTI, I wonder if that trend continued for 2020.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by EfficientInvestor »

anon_investor wrote: Thu May 20, 2021 11:36 am I couldn't find it on the WisdomTree website, how much of those non-long term capital gains were from qualified dividends? I am just trying to understand how NTSX compares to VTI tax efficiency wise. I know after 2019, people mentioned that it had comparable tax efficiency to VTI, I wonder if that trend continued for 2020.
See my updated post just above yours that includes links to the Schwab cost ratio analysis.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by Polymorphic »

We are spoiled for choice these days, but a fund like this in global market weight form (think VT) would be perfect. The only thing really holding me back from the WisdomTree core funds is not wanting to give up the simplicity of VT. I'd rather not have to rebalance three funds to market weight across all my accounts.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by HawkeyePierce »

I'd love to see a total world version. I also wouldn't complain about an ex-US small cap version.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by bjcleaver »

DMoogle wrote: Thu May 20, 2021 10:42 am Thinking about slapping my whole taxable portfolio moving forward (not liquidating current holdings for tax reasons) in:
70% NTSX
20% NTSI
10% NTSE

Doesn't look like they're live in Interactive Brokers just yet.
I have a good chunk of my taxable in NTSX since earlier this year. I'll probably add new funds to NTSI/E to add some exposure.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by drzzzzz »

Will the new funds (NTSI and NTSE) use treasury futures as well? Also what are the funds indexed to? thanks
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by Elysium »

Question to folks out here following these funds.

I need to help out a young person who is interested in investing for their future. They don't have a lot of money, or a stable job with a lot of income at present, they are trying to improve their situation, but they have some money they like to invest for future. That person is aware of what other friends are doing with Crypto, FAANG stocks, etc, but not interested in following it. Risk is a factor they are aware of, the idea of investing in S&P 500 index appeals to them.

That said, I believe in the situation this person is they need little bit more than steady index investing, since their economic situation isn't great, and the pay is not steady. I'd like to help them get a little bit more than standard S&P 500 index but without risking too much. Would you say these funds are good candidates for that.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by cos »

Elysium wrote: Thu May 20, 2021 6:39 pm Question to folks out here following these funds.

I need to help out a young person who is interested in investing for their future. They don't have a lot of money, or a stable job with a lot of income at present, they are trying to improve their situation, but they have some money they like to invest for future. That person is aware of what other friends are doing with Crypto, FAANG stocks, etc, but not interested in following it. Risk is a factor they are aware of, the idea of investing in S&P 500 index appeals to them.

That said, I believe in the situation this person is they need little bit more than steady index investing, since their economic situation isn't great, and the pay is not steady. I'd like to help them get a little bit more than standard S&P 500 index but without risking too much. Would you say these funds are good candidates for that.
If anything, these funds carry less risk than a straight S&P 500 index.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by DMoogle »

Elysium wrote: Thu May 20, 2021 6:39 pm Question to folks out here following these funds.

I need to help out a young person who is interested in investing for their future. They don't have a lot of money, or a stable job with a lot of income at present, they are trying to improve their situation, but they have some money they like to invest for future. That person is aware of what other friends are doing with Crypto, FAANG stocks, etc, but not interested in following it. Risk is a factor they are aware of, the idea of investing in S&P 500 index appeals to them.

That said, I believe in the situation this person is they need little bit more than steady index investing, since their economic situation isn't great, and the pay is not steady. I'd like to help them get a little bit more than standard S&P 500 index but without risking too much. Would you say these funds are good candidates for that.
First thing I would do is gauge their true risk appetite. If they have $10,000 and invested it in say the S&P 500, would they be mentally OK if, a month from now, there was a horrible crash and they lost half their investment? If they're not comfortable with that, then figure out what they are comfortable with.

I think this fund targets returns similar to the S&P500, but with lower risk. For a taxable account, I think it's a really solid option. If it's a taxed-sheltered account, then PSLDX would be a more aggressive option.
cos wrote: Thu May 20, 2021 9:13 pm If anything, these funds carry less risk than a straight S&P 500 index.
Although I agree, but it's kind of debatable. Tail-end risk is higher, but you could certainly argue that that's inconsequential.
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