Thinking of Dropping Out of International Stock Funds

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
Johnathon Livingston
Posts: 163
Joined: Sun May 09, 2021 6:10 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by Johnathon Livingston »

nigel_ht wrote: Thu Jul 29, 2021 7:23 am
pokebowl wrote: Thu Jul 29, 2021 2:13 am
wootwoot wrote: Wed Jul 28, 2021 8:35 am Good call OP. International funds are perpetually lagging in performance.
If that is the only criteria to invest or not invest. Let me steal an old image from forum member vineviz:

Image

The year is 1991 instead of 2021, based on the initial criteria above, do you bother with US at all after 20 years of under performance?
Chart is hugely misleading. There isn’t 20 years of underperformance.

Image

There are periods where one or the other leads in performance.

Picking a advantageous starting point to imply US trailed international for 20 years is disingenuous. Especially since it’s been pointed out several times.
Ok, perhaps this market is different than 1991, but if performance is the basis, why US? When its lagged other countries significantly over the last 20 years, for example Australia:

Image

Hopefully when the all US folks retire, it will be similar to 2010 and not the 1960s. Would be a shame to have 20+ years of under-performance. :beer
Same story:

Image

Using a different start date has US ahead.

https://www.portfoliovisualizer.com/bac ... tion3_3=40

All you have to do is look at the other chart and pick a start date where one or the other outperforms and then incorrectly claim X years of outperformance.

The other aspect is if you use a cap weight index like VXUS Australia is just 4-5%. To capture outperformance in smaller countries means giving them outsized impact on your portfolio…for every Australia there are likely a couple under performers.

I’ll keep 20% VXUS as a hedge but nothing so far in the data is compelling enough to say global market weight should be a default for all investors vs 80/20 VTI/VXUS.
I think this is a healthy way to look at it. I view the US as my haystack,” and ex-US as a hedge. That’s different than a global market cap weight disciple that views the world as the haystack.
nigel_ht
Posts: 4742
Joined: Tue Jan 01, 2019 9:14 am

Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

EnjoyIt wrote: Thu Jul 29, 2021 10:27 am
lostdog wrote: Wed Jul 28, 2021 9:49 am
Nathan Drake wrote: Wed Jul 28, 2021 9:37 am
YRT70 wrote: Wed Jul 28, 2021 9:26 am Might not be the best timing. Then again, who knows.

Image
Valuations don’t matter. US stocks going to Japan levels of P/E!

Apple stock to be worth more than all exUS market caps combined!!!

Thank you Jack!!!
I invest in U.S. only because it will outperform to infinity and beyond! Thanks Jack, you are right and will be right forever!
It sounds like sarcasm, but I’m concerned it is not.

The shear thought that valuations don’t matter and stocks have only one way to go but up especially if those stocks are based in the US is nonsensical. Bogle also talked about reversion to the mean.

I’m no international evangelist but I do realize that “to the moon” is not a rational strategy
If you watch the squiggly lines move up and down together since 2000, even if there is space between them, I don't link that ex-US is a robust alternative to TINA...

I dunno what IS the alternative to TINA...but if VTI collapses I would bet my crystal ball that VXUS will crater along with it. Granted probably not as deep but that's a relatively cold comfort and I'm not sure that my bonds will be much more than "ballast". The last time I checked "ballast" was dead weight that doesn't actually help the boat float...just stay more stable. Which has a lot of value but not as much when the boat is taking on water and foundering...

GLD is the Hail Mary in my portfolio and I dunno that I have enough of it to matter.
Nathan Drake
Posts: 6235
Joined: Mon Apr 11, 2011 12:28 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Nathan Drake »

nigel_ht wrote: Thu Jul 29, 2021 11:33 am
EnjoyIt wrote: Thu Jul 29, 2021 10:27 am
lostdog wrote: Wed Jul 28, 2021 9:49 am
Nathan Drake wrote: Wed Jul 28, 2021 9:37 am
YRT70 wrote: Wed Jul 28, 2021 9:26 am Might not be the best timing. Then again, who knows.

Image
Valuations don’t matter. US stocks going to Japan levels of P/E!

Apple stock to be worth more than all exUS market caps combined!!!

Thank you Jack!!!
I invest in U.S. only because it will outperform to infinity and beyond! Thanks Jack, you are right and will be right forever!
It sounds like sarcasm, but I’m concerned it is not.

The shear thought that valuations don’t matter and stocks have only one way to go but up especially if those stocks are based in the US is nonsensical. Bogle also talked about reversion to the mean.

I’m no international evangelist but I do realize that “to the moon” is not a rational strategy
If you watch the squiggly lines move up and down together since 2000, even if there is space between them, I don't link that ex-US is a robust alternative to TINA...

I dunno what IS the alternative to TINA...but if VTI collapses I would bet my crystal ball that VXUS will crater along with it. Granted probably not as deep but that's a relatively cold comfort and I'm not sure that my bonds will be much more than "ballast". The last time I checked "ballast" was dead weight that doesn't actually help the boat float...just stay more stable. Which has a lot of value but not as much when the boat is taking on water and foundering...

GLD is the Hail Mary in my portfolio and I dunno that I have enough of it to matter.
Yep! It’ll crater for a year or two, one may crater more than the other, and the growth over the next decade will likely diverge just as the graph indicates.

I don’t diversify to protect against acute risk

This shouldn’t be hard to grasp
20% VOO | 20% VXUS | 20% AVUV | 20% AVDV | 20% AVES
fcf18
Posts: 57
Joined: Wed Jun 13, 2018 9:35 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by fcf18 »

This same argument can be applied to US sectors or even individual companies. If we knew 20 years how the US market and international market would have performed, you are correct, there is no reason to invest in international. However, if we knew how things are going to pan out, there is no reason to invest in the US market index either, you should have just invested in the FANG companies only, and add some bitcoin and TESLA at the right time, you are golden.
nigel_ht
Posts: 4742
Joined: Tue Jan 01, 2019 9:14 am

Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

fcf18 wrote: Thu Jul 29, 2021 11:38 am This same argument can be applied to US sectors or even individual companies. If we knew 20 years how the US market and international market would have performed, you are correct, there is no reason to invest in international. However, if we knew how things are going to pan out, there is no reason to invest in the US market index either, you should have just invested in the FANG companies only, and add some bitcoin and TESLA at the right time, you are golden.
Lol...if you had diversified 1% into bitcoin really early on...

It's why I have a 5% play stash but have never been willing to gamble to that degree...
User avatar
burritoLover
Posts: 4097
Joined: Sun Jul 05, 2020 12:13 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by burritoLover »

A total U.S. stock market index contains a huge amount of crappy companies that can't perform even as well as short-term treasuries in the long-term - something like 94% of all companies. If you are so good at predicting the future returns of a country like the US vs ex-US, then you should be trading individual US stocks instead - use your skill to weed out the duds from the total market.
EnjoyIt
Posts: 8272
Joined: Sun Dec 29, 2013 7:06 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by EnjoyIt »

I would say, my one suggestion to anyone who is strongly considering dropping out of international is to instead adjust their AA by 5%. Say from 30% to 25% as an example. If you are still contributing, then stop contributing to international and only add to US equities allowing your portfolio to drift to your desired AA. If you are in the retirement phase then allow US equities to increase via growth to the new desired AA or sell from international for living expenses or a combination of the two.

Don't make drastic changes with your portfolio. Let the 5% difference sit there for a year or two or three and then re-evaluate. Write it in your IPS so that you don't use emotions in your decision making. Personally I think having some international has its merits though I fault no one for thinking otherwise. What I do fault is adjusting your holding quickly based on past performance.
A time to EVALUATE your jitters: | viewtopic.php?p=1139732#p1139732
seajay
Posts: 1656
Joined: Sat May 01, 2021 3:26 pm
Contact:

Re: Thinking of Dropping Out of International Stock Funds

Post by seajay »

Circumstances/events/fear (Covid/financial crisis etc.) has seen a massive flow to safety (US$). When such fears subside so greed will return and investors will seek 'better Value'.
User avatar
burritoLover
Posts: 4097
Joined: Sun Jul 05, 2020 12:13 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by burritoLover »

What's funny is that these investors always start with some international. What were they expecting then? That both would perform similarly for all time? That one or the other would only trail by a small margin all the time?
EnjoyIt
Posts: 8272
Joined: Sun Dec 29, 2013 7:06 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by EnjoyIt »

nigel_ht wrote: Thu Jul 29, 2021 11:33 am
EnjoyIt wrote: Thu Jul 29, 2021 10:27 am
lostdog wrote: Wed Jul 28, 2021 9:49 am
Nathan Drake wrote: Wed Jul 28, 2021 9:37 am
YRT70 wrote: Wed Jul 28, 2021 9:26 am Might not be the best timing. Then again, who knows.

Image
Valuations don’t matter. US stocks going to Japan levels of P/E!

Apple stock to be worth more than all exUS market caps combined!!!

Thank you Jack!!!
I invest in U.S. only because it will outperform to infinity and beyond! Thanks Jack, you are right and will be right forever!
It sounds like sarcasm, but I’m concerned it is not.

The shear thought that valuations don’t matter and stocks have only one way to go but up especially if those stocks are based in the US is nonsensical. Bogle also talked about reversion to the mean.

I’m no international evangelist but I do realize that “to the moon” is not a rational strategy
If you watch the squiggly lines move up and down together since 2000, even if there is space between them, I don't link that ex-US is a robust alternative to TINA...

I dunno what IS the alternative to TINA...but if VTI collapses I would bet my crystal ball that VXUS will crater along with it. Granted probably not as deep but that's a relatively cold comfort and I'm not sure that my bonds will be much more than "ballast". The last time I checked "ballast" was dead weight that doesn't actually help the boat float...just stay more stable. Which has a lot of value but not as much when the boat is taking on water and foundering...

GLD is the Hail Mary in my portfolio and I dunno that I have enough of it to matter.
Not sure why you brought up TINA. I just don't think "to the moon" and "valuations don't matter" is a logical strategy. "This time it's different" is not a logical strategy. That is probably the exact reason why it can benefit someone to have diversification in one's portfolio.

But to your specific comment, yeah Ex-US will likely go down if US goes down. That may not be the case if the reason US goes down is if the dollar is not the reserve currency. Or something specific to the US such as massive California earthquake that takes down some our biggest companies. Or some other very US specific calamity. Who know, that's the point...who knows?
A time to EVALUATE your jitters: | viewtopic.php?p=1139732#p1139732
garlandwhizzer
Posts: 3565
Joined: Fri Aug 06, 2010 3:42 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by garlandwhizzer »

I have held close to global cap weight holdings of INTL for at least a decade. INTL fundamental measures from a value standpoint like PE, PB, etc., have consistently been far more attractive than richly priced US equity in both LC and SC spaces. On paper if relative valuations matter at all, I should have been a big winner. Instead I have been a big loser, even a bigger loser than a cap weight mix of DM and EM because I have held 50% EM/50% DM, again because EM valuations have looked more attractive than DM.

I'm not the only one who has suffered from my focus on traditional measure of valuations. Many value oriented investment experts including Rob Arnott and Dr. Bernstein viewing the stark differences in relative valuations suggested a decade ago that INTL stocks were expected to significantly outperform US stocks going forward. In fact, the opposite has happened. To a much lesser extent, US value has trailed both US blend and especially US growth over the last decade, although US value has in the last year come to life and outperformed. INTL and especially ultra-cheap EM continue to suffer. These facts raises the question of how reliable fundamental measures of valuation are in predicting future returns. The cheap have gotten even cheaper and the expensive have gotten even more expensive, the opposite of what we expect for a long time. Meanwhile Bogle, an advocate of 100% cap weight US or if you must 20% INTL, once again looks like an investing sage not fooled by fundamental analysis numbers.

What are we to conclude from this? Only one thing is certain and that is uncertainty. No one knows reliably whether INTL and to a lesser extent value in general will make a startling comeback after more than a decade of struggle or continue to struggle going forward. Personally, I believe that given the massive stretch in relative valuation measures between US and INTL at present, reversion to the mean is likely to occur at some point. I am not selling my substantial INTL holdings because I stubbornly believe that this long period of suffering by INTL will at some point reverse. That is my opinion and opinions are all we have on this question going forward. I fully realize that the markets may prove me wrong in my belief just as they have done for the last decade. It is against my religion to sell risk assets in weakness. Many US investors are now giving up on INTL now and understandably so, but I refuse to be one of them. Market history suggests that persistent long term outperformance of a certain slice of the market does not last forever. I'll hold on to 60 US/40 INTL which covers both bases rather than putting all my eggs in the basket that has been so successful for so long.

Garland Whizzer
User avatar
Miriam2
Posts: 4387
Joined: Fri Nov 14, 2014 10:51 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Miriam2 »

garlandwhizzer wrote: I have held close to global cap weight holdings of INTL for at least a decade. INTL fundamental measures from a value standpoint like PE, PB, etc., have consistently been far more attractive than richly priced US equity in both LC and SC spaces. On paper if relative valuations matter at all, I should have been a big winner. Instead I have been a big loser, even a bigger loser than a cap weight mix of DM and EM because I have held 50% EM/50% DM, again because EM valuations have looked more attractive than DM.

I'm not the only one who has suffered from my focus on traditional measure of valuations. Many value oriented investment experts including Rob Arnott and Dr. Bernstein viewing the stark differences in relative valuations suggested a decade ago that INTL stocks were expected to significantly outperform US stocks going forward. In fact, the opposite has happened. To a much lesser extent, US value has trailed both US blend and especially US growth over the last decade, although US value has in the last year come to life and outperformed. INTL and especially ultra-cheap EM continue to suffer. These facts raises the question of how reliable fundamental measures of valuation are in predicting future returns. The cheap have gotten even cheaper and the expensive have gotten even more expensive, the opposite of what we expect for a long time. Meanwhile Bogle, an advocate of 100% cap weight US or if you must 20% INTL, once again looks like an investing sage not fooled by fundamental analysis numbers.

What are we to conclude from this? Only one thing is certain and that is uncertainty. No one knows reliably whether INTL and to a lesser extent value in general will make a startling comeback after more than a decade of struggle or continue to struggle going forward. Personally, I believe that given the massive stretch in relative valuation measures between US and INTL at present, reversion to the mean is likely to occur at some point. I am not selling my substantial INTL holdings because I stubbornly believe that this long period of suffering by INTL will at some point reverse. That is my opinion and opinions are all we have on this question going forward. I fully realize that the markets may prove me wrong in my belief just as they have done for the last decade. It is against my religion to sell risk assets in weakness. Many US investors are now giving up on INTL now and understandably so, but I refuse to be one of them. Market history suggests that persistent long term outperformance of a certain slice of the market does not last forever. I'll hold on to 60 US/40 INTL which covers both bases rather than putting all my eggs in the basket that has been so successful for so long.

Garland Whizzer
Thank you GW for your insightful post. I remember that, back in the old days, you very eloquently discussed why you were interested in investing in emerging markets, perhaps more than plain International. I wondered what you did over the years - now I enjoyed learning about your current thoughts on this. Appreciate you taking the time to post your thoughts.
Visitor76
Posts: 326
Joined: Tue Mar 17, 2020 7:08 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Visitor76 »

EnjoyIt wrote: Thu Jul 29, 2021 11:04 am
Marseille07 wrote: Thu Jul 29, 2021 10:54 am
EnjoyIt wrote: Thu Jul 29, 2021 10:46 am Studies show that performance chasing underperforms buy and hold.
Not sure who is performance chasing here then. We're talking about US vs ex-US, but both are B&H.
The person who wrote they will buy EX-US if EX-US starts performing better.
Yes, if after a period of time I see a fund begin to perform better I will add it to my portfolio if it meets my long term goals. The type of "performance chasing" that you are describing belongs to traders.
Wealth is not about having a lot of money; it's about having a lot of options.
EnjoyIt
Posts: 8272
Joined: Sun Dec 29, 2013 7:06 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by EnjoyIt »

Visitor76 wrote: Thu Jul 29, 2021 2:18 pm
EnjoyIt wrote: Thu Jul 29, 2021 11:04 am
Marseille07 wrote: Thu Jul 29, 2021 10:54 am
EnjoyIt wrote: Thu Jul 29, 2021 10:46 am Studies show that performance chasing underperforms buy and hold.
Not sure who is performance chasing here then. We're talking about US vs ex-US, but both are B&H.
The person who wrote they will buy EX-US if EX-US starts performing better.
Yes, if after a period of time I see a fund begin to perform better I will add it to my portfolio if it meets my long term goals. The type of "performance chasing" that you are describing belongs to traders.
History shows that performance chasing underperforms buy and hold.
A time to EVALUATE your jitters: | viewtopic.php?p=1139732#p1139732
EnjoyIt
Posts: 8272
Joined: Sun Dec 29, 2013 7:06 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by EnjoyIt »

garlandwhizzer wrote: Thu Jul 29, 2021 1:32 pm I have held close to global cap weight holdings of INTL for at least a decade. INTL fundamental measures from a value standpoint like PE, PB, etc., have consistently been far more attractive than richly priced US equity in both LC and SC spaces. On paper if relative valuations matter at all, I should have been a big winner. Instead I have been a big loser, even a bigger loser than a cap weight mix of DM and EM because I have held 50% EM/50% DM, again because EM valuations have looked more attractive than DM.

I'm not the only one who has suffered from my focus on traditional measure of valuations. Many value oriented investment experts including Rob Arnott and Dr. Bernstein viewing the stark differences in relative valuations suggested a decade ago that INTL stocks were expected to significantly outperform US stocks going forward. In fact, the opposite has happened. To a much lesser extent, US value has trailed both US blend and especially US growth over the last decade, although US value has in the last year come to life and outperformed. INTL and especially ultra-cheap EM continue to suffer. These facts raises the question of how reliable fundamental measures of valuation are in predicting future returns. The cheap have gotten even cheaper and the expensive have gotten even more expensive, the opposite of what we expect for a long time. Meanwhile Bogle, an advocate of 100% cap weight US or if you must 20% INTL, once again looks like an investing sage not fooled by fundamental analysis numbers.

What are we to conclude from this? Only one thing is certain and that is uncertainty. No one knows reliably whether INTL and to a lesser extent value in general will make a startling comeback after more than a decade of struggle or continue to struggle going forward. Personally, I believe that given the massive stretch in relative valuation measures between US and INTL at present, reversion to the mean is likely to occur at some point. I am not selling my substantial INTL holdings because I stubbornly believe that this long period of suffering by INTL will at some point reverse. That is my opinion and opinions are all we have on this question going forward. I fully realize that the markets may prove me wrong in my belief just as they have done for the last decade. It is against my religion to sell risk assets in weakness. Many US investors are now giving up on INTL now and understandably so, but I refuse to be one of them. Market history suggests that persistent long term outperformance of a certain slice of the market does not last forever. I'll hold on to 60 US/40 INTL which covers both bases rather than putting all my eggs in the basket that has been so successful for so long.

Garland Whizzer
Great post.

Though I do wonder if maybe investors are willing to pay a bit more for their equities compared to the past so that PE ratios will run a bit higher in the decades to come. I hope I'm not saying "this time is different."
A time to EVALUATE your jitters: | viewtopic.php?p=1139732#p1139732
nigel_ht
Posts: 4742
Joined: Tue Jan 01, 2019 9:14 am

Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

EnjoyIt wrote: Thu Jul 29, 2021 2:40 pm I hope I'm not saying "this time is different."
The thing is, this time IS different. It almost always is.

The question is it different enough to matter.

Plus it's unlikely that the Fed will screw things up the same way twice...they tend to be pretty bright folks so they will invent new ways to screw up.
Marseille07
Posts: 16054
Joined: Fri Nov 06, 2020 12:41 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by Marseille07 »

nigel_ht wrote: Thu Jul 29, 2021 2:44 pm Plus it's unlikely that the Fed will screw things up the same way twice...they tend to be pretty bright folks so they will invent new ways to screw up.
Imo the issue - good and bad - is that their past policies often help the Wall Street moreso than the Main Street. It's bad for the Main Street, but good for the US stockholders like us.
stan1
Posts: 14246
Joined: Mon Oct 08, 2007 4:35 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by stan1 »

Part of the problem is the "diversification is the only free lunch in investing" quote from Nobel prize winner Harry Markowitz made in 1952. I don't like "free lunch" quotes. There is no such thing as a true "free lunch". There are always strings.

In a theoretical sense of not knowing what future returns will be the quote makes sense, but when it is applied to past performance where actual returns are known it can be shown to be incorrect. In execution diversification may have a cost which is under performance of some asset classes potentially for many years.
Last edited by stan1 on Thu Jul 29, 2021 5:41 pm, edited 1 time in total.
tibbitts
Posts: 23728
Joined: Tue Feb 27, 2007 5:50 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by tibbitts »

Visitor76 wrote: Thu Jul 29, 2021 2:18 pm
EnjoyIt wrote: Thu Jul 29, 2021 11:04 am
Marseille07 wrote: Thu Jul 29, 2021 10:54 am
EnjoyIt wrote: Thu Jul 29, 2021 10:46 am Studies show that performance chasing underperforms buy and hold.
Not sure who is performance chasing here then. We're talking about US vs ex-US, but both are B&H.
The person who wrote they will buy EX-US if EX-US starts performing better.
Yes, if after a period of time I see a fund begin to perform better I will add it to my portfolio if it meets my long term goals. The type of "performance chasing" that you are describing belongs to traders.
The problem is quantifying "period of time" and "perform better." It has to be something you can create a rule for. Where people get into the most trouble is when they try to invest by "feel." So what are your rules for adding (and dropping) funds?
User avatar
burritoLover
Posts: 4097
Joined: Sun Jul 05, 2020 12:13 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by burritoLover »

stan1 wrote: Thu Jul 29, 2021 4:24 pm Part of the problem is the "diversification is the only free lunch in investing" quote from Nobel prize winner Harry Markowitz made in 1952. I don't like "free lunch" quotes. There is no such thing as a true "free lunch". There are always strings.

In a theoretical sense of not knowing what future returns will be the quote makes sense, but when it is applied to past performance where actual returns are known it can be shown to be incorrect. In execution diversification may have a cost which is under performance of some asset classes potentially for many years.
Lol what
kimura king
Posts: 264
Joined: Tue Dec 31, 2019 3:59 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by kimura king »

Per the wikipedia page, International index funds are an individual asset class and separate from the US allocated index funds, even though both are equities.

Is that accurate? Are international stocks really a separate asset class, just as cash, reits, gold, bonds, etc? Sorry for the dumb question but I just wanted to confirm.
TropikThunder
Posts: 3918
Joined: Sun Apr 03, 2016 5:41 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by TropikThunder »

lostdog wrote: Wed Jul 28, 2021 9:49 am
Nathan Drake wrote: Wed Jul 28, 2021 9:37 am Valuations don’t matter. US stocks going to Japan levels of P/E!

Apple stock to be worth more than all exUS market caps combined!!!

Thank you Jack!!!
I invest in U.S. only because it will outperform to infinity and beyond! Thanks Jack, you are right and will be right forever!
I mean, it's really only a matter of time before US is 100% of global market cap since it will always outperform Int'l.
EnjoyIt
Posts: 8272
Joined: Sun Dec 29, 2013 7:06 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by EnjoyIt »

nigel_ht wrote: Thu Jul 29, 2021 2:44 pm
EnjoyIt wrote: Thu Jul 29, 2021 2:40 pm I hope I'm not saying "this time is different."
The thing is, this time IS different. It almost always is.

The question is it different enough to matter.

Plus it's unlikely that the Fed will screw things up the same way twice...they tend to be pretty bright folks so they will invent new ways to screw up.
It is always different, but it isn't. There are always new and different calamities that can make one feel like the world is crumbling. But, the market behaves as the market has behaved. Things are different, but in the grand scheme of things they are the same.
A time to EVALUATE your jitters: | viewtopic.php?p=1139732#p1139732
stan1
Posts: 14246
Joined: Mon Oct 08, 2007 4:35 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by stan1 »

kimura king wrote: Thu Jul 29, 2021 6:10 pm Per the wikipedia page, International index funds are an individual asset class and separate from the US allocated index funds, even though both are equities.

Is that accurate? Are international stocks really a separate asset class, just as cash, reits, gold, bonds, etc? Sorry for the dumb question but I just wanted to confirm.
There is no single, universal definition of what an asset class is. If you search for "asset class definitions" in Google you will see many different ones. Under the "People Also Ask" section I see:
What are the 5, 7, 9, 12, 10, and 4 asset classes.

Some definitions would have US equities and ex US equities as different asset classes, under other definitions US and ex US would be sub asset classes of the equities asset class. Just depends what model you choose to follow for your purposes.
Wannaretireearly
Posts: 4881
Joined: Wed Mar 31, 2010 4:39 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by Wannaretireearly »

YRT70 wrote: Wed Jul 28, 2021 9:26 am Might not be the best timing. Then again, who knows.

Image

Image
These charts are all I need to stick with Intl.
Aren't we due a US financial crisis? Wonder what Wall St and Hedge fund managers have dreamed up past few years 🤔.
“At some point you are trading time you will never get back for money you will never spend.“ | “How do you want to spend the best remaining year of your life?“
Visitor76
Posts: 326
Joined: Tue Mar 17, 2020 7:08 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Visitor76 »

tibbitts wrote: Thu Jul 29, 2021 4:54 pm
Visitor76 wrote: Thu Jul 29, 2021 2:18 pm
EnjoyIt wrote: Thu Jul 29, 2021 11:04 am
Marseille07 wrote: Thu Jul 29, 2021 10:54 am
EnjoyIt wrote: Thu Jul 29, 2021 10:46 am Studies show that performance chasing underperforms buy and hold.
Not sure who is performance chasing here then. We're talking about US vs ex-US, but both are B&H.
The person who wrote they will buy EX-US if EX-US starts performing better.
Yes, if after a period of time I see a fund begin to perform better I will add it to my portfolio if it meets my long term goals. The type of "performance chasing" that you are describing belongs to traders.
The problem is quantifying "period of time" and "perform better." It has to be something you can create a rule for. Where people get into the most trouble is when they try to invest by "feel." So what are your rules for adding (and dropping) funds?
I do annual evaluations of my portfolio, and if I see that a fund under performed from the previous year I look for a replacement fund with a better performance. If none exist I stick with the original fund.
Wealth is not about having a lot of money; it's about having a lot of options.
User avatar
midareff
Posts: 7711
Joined: Mon Nov 29, 2010 9:43 am
Location: Biscayne Bay, South Florida

Re: Thinking of Dropping Out of International Stock Funds

Post by midareff »

MrCheapo wrote: Tue Jul 27, 2021 11:17 am Hi

So like a good Bogle-head I split my assets b/w US-Stocks, International Stocks and Fixed Assets (Bonds, MM etc.) for the last few decades.

Reviewing performance over the last 20 years of say VGTSX (total international stock fund) I see it's barely up 30% compared to say VTSMX (total stock fund) which is up 250%.

Looking at my portfolio of funds ALL of my Vanguard international funds (Total, European, Pacific) are all up less than 30% and often flat (i.e. VEURX)

Fortunately, I'm heavily exposed to US stocks which have put me in a nice position. But I'm seriously thinking, why on earth invest in these international funds if they barely beat inflation.

Thoughts?
That way you can have the free lunch diversification brings..... or is it paying filet prices for bad hamburger meat? Another option is that it is a fund you can keep a long time and not have the capital gains break the bank.
Da5id
Posts: 5066
Joined: Fri Feb 26, 2016 7:20 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Da5id »

Visitor76 wrote: Fri Jul 30, 2021 7:21 am
tibbitts wrote: Thu Jul 29, 2021 4:54 pm
Visitor76 wrote: Thu Jul 29, 2021 2:18 pm
EnjoyIt wrote: Thu Jul 29, 2021 11:04 am
Marseille07 wrote: Thu Jul 29, 2021 10:54 am

Not sure who is performance chasing here then. We're talking about US vs ex-US, but both are B&H.
The person who wrote they will buy EX-US if EX-US starts performing better.
Yes, if after a period of time I see a fund begin to perform better I will add it to my portfolio if it meets my long term goals. The type of "performance chasing" that you are describing belongs to traders.
The problem is quantifying "period of time" and "perform better." It has to be something you can create a rule for. Where people get into the most trouble is when they try to invest by "feel." So what are your rules for adding (and dropping) funds?
I do annual evaluations of my portfolio, and if I see that a fund under performed from the previous year I look for a replacement fund with a better performance. If none exist I stick with the original fund.
That sounds like classic performance chasing. Which doesn't seem to work very well. see e.g. https://www.spglobal.com/spdji/en/spiva ... -scorecard. Last years winners have little persistence.
seajay
Posts: 1656
Joined: Sat May 01, 2021 3:26 pm
Contact:

Re: Thinking of Dropping Out of International Stock Funds

Post by seajay »

MrCheapo wrote: Tue Jul 27, 2021 11:17 am Looking at my portfolio of funds ALL of my Vanguard international funds (Total, European, Pacific) are all up less than 30% and often flat (i.e. VEURX)
Why stop there. Look at the US stock index and many individual shares will likely have lagged the broad average, ditch those as well? <rhetoric>
Triple digit golfer
Posts: 10433
Joined: Mon May 18, 2009 5:57 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by Triple digit golfer »

Visitor76 wrote: Fri Jul 30, 2021 7:21 am
tibbitts wrote: Thu Jul 29, 2021 4:54 pm
Visitor76 wrote: Thu Jul 29, 2021 2:18 pm
EnjoyIt wrote: Thu Jul 29, 2021 11:04 am
Marseille07 wrote: Thu Jul 29, 2021 10:54 am

Not sure who is performance chasing here then. We're talking about US vs ex-US, but both are B&H.
The person who wrote they will buy EX-US if EX-US starts performing better.
Yes, if after a period of time I see a fund begin to perform better I will add it to my portfolio if it meets my long term goals. The type of "performance chasing" that you are describing belongs to traders.
The problem is quantifying "period of time" and "perform better." It has to be something you can create a rule for. Where people get into the most trouble is when they try to invest by "feel." So what are your rules for adding (and dropping) funds?
I do annual evaluations of my portfolio, and if I see that a fund under performed from the previous year I look for a replacement fund with a better performance. If none exist I stick with the original fund.
That is a really bad strategy, but you do you.
Visitor76
Posts: 326
Joined: Tue Mar 17, 2020 7:08 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Visitor76 »

Da5id wrote: Fri Jul 30, 2021 7:34 am
Visitor76 wrote: Fri Jul 30, 2021 7:21 am
tibbitts wrote: Thu Jul 29, 2021 4:54 pm
Visitor76 wrote: Thu Jul 29, 2021 2:18 pm
EnjoyIt wrote: Thu Jul 29, 2021 11:04 am

The person who wrote they will buy EX-US if EX-US starts performing better.
Yes, if after a period of time I see a fund begin to perform better I will add it to my portfolio if it meets my long term goals. The type of "performance chasing" that you are describing belongs to traders.
The problem is quantifying "period of time" and "perform better." It has to be something you can create a rule for. Where people get into the most trouble is when they try to invest by "feel." So what are your rules for adding (and dropping) funds?
I do annual evaluations of my portfolio, and if I see that a fund under performed from the previous year I look for a replacement fund with a better performance. If none exist I stick with the original fund.
That sounds like classic performance chasing. Which doesn't seem to work very well. see e.g. https://www.spglobal.com/spdji/en/spiva ... -scorecard. Last years winners have little persistence.
Perhaps, but I sleep better at night with the knowledge there aren't any weak links in my portfolio.
Wealth is not about having a lot of money; it's about having a lot of options.
Da5id
Posts: 5066
Joined: Fri Feb 26, 2016 7:20 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Da5id »

Visitor76 wrote: Fri Jul 30, 2021 8:49 am
Da5id wrote: Fri Jul 30, 2021 7:34 am
Visitor76 wrote: Fri Jul 30, 2021 7:21 am
tibbitts wrote: Thu Jul 29, 2021 4:54 pm
Visitor76 wrote: Thu Jul 29, 2021 2:18 pm

Yes, if after a period of time I see a fund begin to perform better I will add it to my portfolio if it meets my long term goals. The type of "performance chasing" that you are describing belongs to traders.
The problem is quantifying "period of time" and "perform better." It has to be something you can create a rule for. Where people get into the most trouble is when they try to invest by "feel." So what are your rules for adding (and dropping) funds?
I do annual evaluations of my portfolio, and if I see that a fund under performed from the previous year I look for a replacement fund with a better performance. If none exist I stick with the original fund.
That sounds like classic performance chasing. Which doesn't seem to work very well. see e.g. https://www.spglobal.com/spdji/en/spiva ... -scorecard. Last years winners have little persistence.
Perhaps, but I sleep better at night with the knowledge there aren't any weak links in my portfolio.
Your assumption that past weak links are future losers, or that past winners are the future winners is the issue. But good luck with your chasing.

And the use of sleep well at night as a trump card in bogleheads is a bit tired. It seems to be an excuse for pretty much anything and everything.
asif408
Posts: 2616
Joined: Sun Mar 02, 2014 7:34 am
Location: Florida

Re: Thinking of Dropping Out of International Stock Funds

Post by asif408 »

Visitor76 wrote: Fri Jul 30, 2021 7:21 am
tibbitts wrote: Thu Jul 29, 2021 4:54 pm
Visitor76 wrote: Thu Jul 29, 2021 2:18 pm
EnjoyIt wrote: Thu Jul 29, 2021 11:04 am
Marseille07 wrote: Thu Jul 29, 2021 10:54 am

Not sure who is performance chasing here then. We're talking about US vs ex-US, but both are B&H.
The person who wrote they will buy EX-US if EX-US starts performing better.
Yes, if after a period of time I see a fund begin to perform better I will add it to my portfolio if it meets my long term goals. The type of "performance chasing" that you are describing belongs to traders.
The problem is quantifying "period of time" and "perform better." It has to be something you can create a rule for. Where people get into the most trouble is when they try to invest by "feel." So what are your rules for adding (and dropping) funds?
I do annual evaluations of my portfolio, and if I see that a fund under performed from the previous year I look for a replacement fund with a better performance. If none exist I stick with the original fund.
I do triennial evaluations of my portfolio, and if I see that a fund underperformed I add more to it. For the funds that have outperformed I sell off some. I sleep great at night knowing I own more of the losers and less of the winners.
Robot Monster
Posts: 4215
Joined: Sun May 05, 2019 11:23 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Robot Monster »

Da5id wrote: Fri Jul 30, 2021 8:52 am And the use of sleep well at night as a trump card in bogleheads is a bit tired. It seems to be an excuse for pretty much anything and everything.
I know, right? Is this Bogleheads, or a sleep clinic?!
lostdog
Posts: 5368
Joined: Thu Feb 04, 2016 1:15 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by lostdog »

Robot Monster wrote: Fri Jul 30, 2021 9:03 am
Da5id wrote: Fri Jul 30, 2021 8:52 am And the use of sleep well at night as a trump card in bogleheads is a bit tired. It seems to be an excuse for pretty much anything and everything.
I know, right? Is this Bogleheads, or a sleep clinic?!
I think there is a mattress that will figure out your "sleep number".
Stocks-80% || Bonds-20% || Taxable-VTI/VXUS || IRA-VT/BNDW
Da5id
Posts: 5066
Joined: Fri Feb 26, 2016 7:20 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Da5id »

lostdog wrote: Fri Jul 30, 2021 9:05 am
Robot Monster wrote: Fri Jul 30, 2021 9:03 am
Da5id wrote: Fri Jul 30, 2021 8:52 am And the use of sleep well at night as a trump card in bogleheads is a bit tired. It seems to be an excuse for pretty much anything and everything.
I know, right? Is this Bogleheads, or a sleep clinic?!
I think there is a mattress that will figure out your "sleep number".
Yep. I think "sleep well at night" makes most sense in the context of volatility. Can't sleep well at night because of having a high percentage of equities and ones portfolio has fallen 20% in a month, sure I can get that. Though it hasn't bother my sleep over the years.

I've seen "can't sleep at night because my (small allocation of) bonds are lagging my stocks too much". In the context of this thread, "can't sleep well at night because my international is underperforming my US" (not sure I've seen it here, but something like that in another thread). Or above "can't sleep well at night because one of my funds has underperformed the competition for the past calendar year". Those are the ones that make me SMH.
SteadyOne
Posts: 688
Joined: Fri Mar 22, 2019 5:26 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by SteadyOne »

kimura king wrote: Thu Jul 29, 2021 6:10 pm Per the wikipedia page, International index funds are an individual asset class and separate from the US allocated index funds, even though both are equities.

Is that accurate? Are international stocks really a separate asset class, just as cash, reits, gold, bonds, etc? Sorry for the dumb question but I just wanted to confirm.
I personally believe that those are separate due to the different legal regimes in non-US world. Either it’s better or worse, but there is a difference. Also, only USD is a world reserve currency, so here is an additional differentiator. Breaking it into developed and emerging markets might be an additional useful step, but things get muddy after that.
“Every de­duc­tion is al­lowed as a mat­ter of leg­isla­tive grace.” US Federal Court
peppers
Posts: 1650
Joined: Tue Oct 25, 2011 7:05 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by peppers »

Robot Monster wrote: Fri Jul 30, 2021 9:03 am
Da5id wrote: Fri Jul 30, 2021 8:52 am And the use of sleep well at night as a trump card in bogleheads is a bit tired. It seems to be an excuse for pretty much anything and everything.
I know, right? Is this Bogleheads, or a sleep clinic?!
Thank you for that.
"..the cavalry ain't comin' kid, you're on your own..."
nigel_ht
Posts: 4742
Joined: Tue Jan 01, 2019 9:14 am

Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

Da5id wrote: Fri Jul 30, 2021 8:52 am
Visitor76 wrote: Fri Jul 30, 2021 8:49 am Perhaps, but I sleep better at night with the knowledge there aren't any weak links in my portfolio.
And the use of sleep well at night as a trump card in bogleheads is a bit tired. It seems to be an excuse for pretty much anything and everything.
AA is based on risk tolerance and is therefore mostly emotional or folks would be 90/10 (the 10 being some sort of EF) over the long haul and then shifting to more defensive as retirement nears.

The two primary things most folks here try to ignore here is luck trumps strategy and "strategy" is often based on some subjective criteria for success.
Da5id
Posts: 5066
Joined: Fri Feb 26, 2016 7:20 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Da5id »

nigel_ht wrote: Fri Jul 30, 2021 10:04 am
Da5id wrote: Fri Jul 30, 2021 8:52 am
Visitor76 wrote: Fri Jul 30, 2021 8:49 am Perhaps, but I sleep better at night with the knowledge there aren't any weak links in my portfolio.
And the use of sleep well at night as a trump card in bogleheads is a bit tired. It seems to be an excuse for pretty much anything and everything.
AA is based on risk tolerance and is therefore mostly emotional or folks would be 90/10 (the 10 being some sort of EF) over the long haul and then shifting to more defensive as retirement nears.

The two primary things most folks here try to ignore here is luck trumps strategy and "strategy" is often based on some subjective criteria for success.
His lack of sleep wasn't about AA (in the sense of % equities vs fixed income). It was that he couldn't sleep well at night having a fund that underperformed other comparable funds for a single year. I just find that level of can't SWAN hard to accept as a reason given for explicit performance chasing.
Visitor76
Posts: 326
Joined: Tue Mar 17, 2020 7:08 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Visitor76 »

asif408 wrote: Fri Jul 30, 2021 8:54 am
Visitor76 wrote: Fri Jul 30, 2021 7:21 am
tibbitts wrote: Thu Jul 29, 2021 4:54 pm
Visitor76 wrote: Thu Jul 29, 2021 2:18 pm
EnjoyIt wrote: Thu Jul 29, 2021 11:04 am

The person who wrote they will buy EX-US if EX-US starts performing better.
Yes, if after a period of time I see a fund begin to perform better I will add it to my portfolio if it meets my long term goals. The type of "performance chasing" that you are describing belongs to traders.
The problem is quantifying "period of time" and "perform better." It has to be something you can create a rule for. Where people get into the most trouble is when they try to invest by "feel." So what are your rules for adding (and dropping) funds?
I do annual evaluations of my portfolio, and if I see that a fund under performed from the previous year I look for a replacement fund with a better performance. If none exist I stick with the original fund.
I do triennial evaluations of my portfolio, and if I see that a fund underperformed I add more to it. For the funds that have outperformed I sell off some. I sleep great at night knowing I own more of the losers and less of the winners.
Yes, but how long do you keep throwing money into the losers?
Wealth is not about having a lot of money; it's about having a lot of options.
Visitor76
Posts: 326
Joined: Tue Mar 17, 2020 7:08 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Visitor76 »

Da5id wrote: Fri Jul 30, 2021 10:13 am
nigel_ht wrote: Fri Jul 30, 2021 10:04 am
Da5id wrote: Fri Jul 30, 2021 8:52 am
Visitor76 wrote: Fri Jul 30, 2021 8:49 am Perhaps, but I sleep better at night with the knowledge there aren't any weak links in my portfolio.
And the use of sleep well at night as a trump card in bogleheads is a bit tired. It seems to be an excuse for pretty much anything and everything.
AA is based on risk tolerance and is therefore mostly emotional or folks would be 90/10 (the 10 being some sort of EF) over the long haul and then shifting to more defensive as retirement nears.

The two primary things most folks here try to ignore here is luck trumps strategy and "strategy" is often based on some subjective criteria for success.
His lack of sleep wasn't about AA (in the sense of % equities vs fixed income). It was that he couldn't sleep well at night having a fund that underperformed other comparable funds for a single year. I just find that level of can't SWAN hard to accept as a reason given for explicit performance chasing.
Given that my portfolio is 100% equities, I have very little patience for under performers. Therefore 12 months is my grace period.
Wealth is not about having a lot of money; it's about having a lot of options.
Marseille07
Posts: 16054
Joined: Fri Nov 06, 2020 12:41 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by Marseille07 »

Da5id wrote: Fri Jul 30, 2021 10:13 am His lack of sleep wasn't about AA (in the sense of % equities vs fixed income). It was that he couldn't sleep well at night having a fund that underperformed other comparable funds for a single year. I just find that level of can't SWAN hard to accept as a reason given for explicit performance chasing.
Both are valid reasons. One side is the fear of losing money, the other side is the FOMO. I had something similar when I held LTTs at one point.

And someone holding US & ex-US consolidating into US-only isn't performance-chasing in my book, provided they don't reverse the course if/when ex-US starts to outperform US.
Nathan Drake
Posts: 6235
Joined: Mon Apr 11, 2011 12:28 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Nathan Drake »

Visitor76 wrote: Fri Jul 30, 2021 10:23 am
asif408 wrote: Fri Jul 30, 2021 8:54 am
Visitor76 wrote: Fri Jul 30, 2021 7:21 am
tibbitts wrote: Thu Jul 29, 2021 4:54 pm
Visitor76 wrote: Thu Jul 29, 2021 2:18 pm

Yes, if after a period of time I see a fund begin to perform better I will add it to my portfolio if it meets my long term goals. The type of "performance chasing" that you are describing belongs to traders.
The problem is quantifying "period of time" and "perform better." It has to be something you can create a rule for. Where people get into the most trouble is when they try to invest by "feel." So what are your rules for adding (and dropping) funds?
I do annual evaluations of my portfolio, and if I see that a fund under performed from the previous year I look for a replacement fund with a better performance. If none exist I stick with the original fund.
I do triennial evaluations of my portfolio, and if I see that a fund underperformed I add more to it. For the funds that have outperformed I sell off some. I sleep great at night knowing I own more of the losers and less of the winners.
Yes, but how long do you keep throwing money into the losers?
Is a 4-5 % real return for VTIAX a loser?

Have you dissected VTSAX to find out what the losers are?
20% VOO | 20% VXUS | 20% AVUV | 20% AVDV | 20% AVES
Da5id
Posts: 5066
Joined: Fri Feb 26, 2016 7:20 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Da5id »

Marseille07 wrote: Fri Jul 30, 2021 10:26 am
Da5id wrote: Fri Jul 30, 2021 10:13 am His lack of sleep wasn't about AA (in the sense of % equities vs fixed income). It was that he couldn't sleep well at night having a fund that underperformed other comparable funds for a single year. I just find that level of can't SWAN hard to accept as a reason given for explicit performance chasing.
Both are valid reasons. One side is the fear of losing money, the other side is the FOMO. I had something similar when I held LTTs at one point.

And someone holding US & ex-US consolidating into US-only isn't performance-chasing in my book, provided they don't reverse the course if/when ex-US starts to outperform US.
His philosophy has nothing to do with international per se as far as I'm aware. But yes, he explicitly does state upthread that he'd buy back into ex-US if it starts outperforming.

He is *annually* evaluating his funds and selling those that underperformed in the past year and buying funds that outperformed. Because he can't sleep well at night. That is classic performance chasing. I guess you are also all in on the SWAN trump card for rationalizing any investment choices, however illogical. Seems like a bad way to manage a portfolio.
Marseille07
Posts: 16054
Joined: Fri Nov 06, 2020 12:41 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by Marseille07 »

Da5id wrote: Fri Jul 30, 2021 10:33 am
Marseille07 wrote: Fri Jul 30, 2021 10:26 am
Da5id wrote: Fri Jul 30, 2021 10:13 am His lack of sleep wasn't about AA (in the sense of % equities vs fixed income). It was that he couldn't sleep well at night having a fund that underperformed other comparable funds for a single year. I just find that level of can't SWAN hard to accept as a reason given for explicit performance chasing.
Both are valid reasons. One side is the fear of losing money, the other side is the FOMO. I had something similar when I held LTTs at one point.

And someone holding US & ex-US consolidating into US-only isn't performance-chasing in my book, provided they don't reverse the course if/when ex-US starts to outperform US.
His philosophy has nothing to do with international per se as far as I'm aware. But yes, he explicitly does state upthread that he'd buy back into ex-US if it starts outperforming.

He is *annually* evaluating his funds and selling those that underperformed in the past year and buying funds that outperformed. Because he can't sleep well at night. That is classic performance chasing.
My bad, I thought we were talking about the OP. We seem to be talking about Visitor76, and if so, I agree that poster is a performance chaser.
nigel_ht
Posts: 4742
Joined: Tue Jan 01, 2019 9:14 am

Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

Da5id wrote: Fri Jul 30, 2021 10:13 am
nigel_ht wrote: Fri Jul 30, 2021 10:04 am
Da5id wrote: Fri Jul 30, 2021 8:52 am
Visitor76 wrote: Fri Jul 30, 2021 8:49 am Perhaps, but I sleep better at night with the knowledge there aren't any weak links in my portfolio.
And the use of sleep well at night as a trump card in bogleheads is a bit tired. It seems to be an excuse for pretty much anything and everything.
AA is based on risk tolerance and is therefore mostly emotional or folks would be 90/10 (the 10 being some sort of EF) over the long haul and then shifting to more defensive as retirement nears.

The two primary things most folks here try to ignore here is luck trumps strategy and "strategy" is often based on some subjective criteria for success.
His lack of sleep wasn't about AA (in the sense of % equities vs fixed income). It was that he couldn't sleep well at night having a fund that underperformed other comparable funds for a single year. I just find that level of can't SWAN hard to accept as a reason given for explicit performance chasing.
My fixed income underperforms vs historical and it bothers me a bit because it puts more pressure on the rest of the portfolio. It doesn't keep me from sleeping but based on comments by people I've talked to they share similar concerns that traditional AAs used by many retirees may be too conservative.

It has impacted my AA selection in my IPS.
Marseille07
Posts: 16054
Joined: Fri Nov 06, 2020 12:41 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by Marseille07 »

Da5id wrote: Fri Jul 30, 2021 10:33 am I guess you are also all in on the SWAN trump card for rationalizing any investment choices, however illogical. Seems like a bad way to manage a portfolio.
Suggesting it's OK to go from US & ex-US to US only is not rationalizing any investment choices. It's also not illogical. I do not appreciate your nonsensical labeling of what I mentioned.
Somethingwitty92912
Posts: 490
Joined: Mon Sep 14, 2020 9:43 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by Somethingwitty92912 »

Begins slow clap* 👏
Da5id
Posts: 5066
Joined: Fri Feb 26, 2016 7:20 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Da5id »

Marseille07 wrote: Fri Jul 30, 2021 11:04 am
Da5id wrote: Fri Jul 30, 2021 10:33 am I guess you are also all in on the SWAN trump card for rationalizing any investment choices, however illogical. Seems like a bad way to manage a portfolio.
Suggesting it's OK to go from US & ex-US to US only is not rationalizing any investment choices. It's also not illogical. I do not appreciate your nonsensical labeling of what I mentioned.
I wasn't talking about you, only visitor76, and you seemed to be endorsing his SWAN to performance chase rationale. You agreed a few posts above that you had misinterpreted me so?
Locked