Thinking of Dropping Out of International Stock Funds

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wootwoot
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Joined: Tue Jan 27, 2009 6:37 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by wootwoot »

Good call OP. International funds are perpetually lagging in performance.
Visitor76
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Joined: Tue Mar 17, 2020 7:08 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Visitor76 »

Triple digit golfer wrote: Wed Jul 28, 2021 7:08 am
Visitor76 wrote: Wed Jul 28, 2021 6:41 am
Triple digit golfer wrote: Tue Jul 27, 2021 2:47 pm
Visitor76 wrote: Tue Jul 27, 2021 2:46 pm
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?
I sold all of my International positions this past spring and never looked back. On top of under performing the US market, International also doesn't provide any balance to US stocks... when the US market is down, International follows suit. :thumbsdown
Since you were looking for something not fully correlated with U.S. stocks, what did you add in place of international that suited your portfolio better?
I meant that International stocks are not correlated to US stocks in a way that bonds usually are.
I agree, and that is to be expected. So you sold them and bought bonds instead?
No, I reallocated the capital from the International funds into my existing US funds. So now I am 100% in US equities and plan to stay the course until I reach my FI number.
Wealth is not about having a lot of money; it's about having a lot of options.
Triple digit golfer
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Re: Thinking of Dropping Out of International Stock Funds

Post by Triple digit golfer »

Visitor76 wrote: Wed Jul 28, 2021 9:07 am
Triple digit golfer wrote: Wed Jul 28, 2021 7:08 am
Visitor76 wrote: Wed Jul 28, 2021 6:41 am
Triple digit golfer wrote: Tue Jul 27, 2021 2:47 pm
Visitor76 wrote: Tue Jul 27, 2021 2:46 pm

I sold all of my International positions this past spring and never looked back. On top of under performing the US market, International also doesn't provide any balance to US stocks... when the US market is down, International follows suit. :thumbsdown
Since you were looking for something not fully correlated with U.S. stocks, what did you add in place of international that suited your portfolio better?
I meant that International stocks are not correlated to US stocks in a way that bonds usually are.
I agree, and that is to be expected. So you sold them and bought bonds instead?
No, I reallocated the capital from the International funds into my existing US funds. So now I am 100% in US equities and plan to stay the course until I reach my FI number.
So you sold out of international stocks because they were too correlated with U.S. stocks, then bought U.S. stocks instead, which are even more correlated with U.S. stocks.
Visitor76
Posts: 326
Joined: Tue Mar 17, 2020 7:08 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Visitor76 »

Triple digit golfer wrote: Wed Jul 28, 2021 9:15 am
Visitor76 wrote: Wed Jul 28, 2021 9:07 am
Triple digit golfer wrote: Wed Jul 28, 2021 7:08 am
Visitor76 wrote: Wed Jul 28, 2021 6:41 am
Triple digit golfer wrote: Tue Jul 27, 2021 2:47 pm

Since you were looking for something not fully correlated with U.S. stocks, what did you add in place of international that suited your portfolio better?
I meant that International stocks are not correlated to US stocks in a way that bonds usually are.
I agree, and that is to be expected. So you sold them and bought bonds instead?
No, I reallocated the capital from the International funds into my existing US funds. So now I am 100% in US equities and plan to stay the course until I reach my FI number.
So you sold out of international stocks because they were too correlated with U.S. stocks, then bought U.S. stocks instead, which are even more correlated with U.S. stocks.
I sold my International fund because it was a drag on my portfolio (I don't own individual stocks). Then I reallocated my existing portfolio into a growth/value blend.
Wealth is not about having a lot of money; it's about having a lot of options.
lostdog
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Joined: Thu Feb 04, 2016 1:15 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by lostdog »

I hope novice investors see this and learn.

We have great examples of idolatry, performance chasing, regret bias, recency bias, etc....

This is not long term investing and sticking to your plan. It's called giving in to human emotion. :oops:
Stocks-80% || Bonds-20% || Taxable-VTI/VXUS || IRA-VT/BNDW
YRT70
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Re: Thinking of Dropping Out of International Stock Funds

Post by YRT70 »

Might not be the best timing. Then again, who knows.

Image

Image
lostdog
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Re: Thinking of Dropping Out of International Stock Funds

Post by lostdog »

Visitor76 wrote: Wed Jul 28, 2021 9:25 am
Triple digit golfer wrote: Wed Jul 28, 2021 9:15 am
Visitor76 wrote: Wed Jul 28, 2021 9:07 am
Triple digit golfer wrote: Wed Jul 28, 2021 7:08 am
Visitor76 wrote: Wed Jul 28, 2021 6:41 am

I meant that International stocks are not correlated to US stocks in a way that bonds usually are.
I agree, and that is to be expected. So you sold them and bought bonds instead?
No, I reallocated the capital from the International funds into my existing US funds. So now I am 100% in US equities and plan to stay the course until I reach my FI number.
So you sold out of international stocks because they were too correlated with U.S. stocks, then bought U.S. stocks instead, which are even more correlated with U.S. stocks.
I sold my International fund because it was a drag on my portfolio (I don't own individual stocks). Then I reallocated my existing portfolio into a growth/value blend.
When will you get back in? If the US index was lagging, would you have dropped that?
Last edited by lostdog on Wed Jul 28, 2021 9:27 am, edited 1 time in total.
Stocks-80% || Bonds-20% || Taxable-VTI/VXUS || IRA-VT/BNDW
Triple digit golfer
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Re: Thinking of Dropping Out of International Stock Funds

Post by Triple digit golfer »

lostdog wrote: Wed Jul 28, 2021 9:25 am I hope novice investors see this and learn.

We have great examples of idolatry, performance chasing, regret bias, recency bias, etc....

This is not long term investing and sticking to your plan. It's called giving in to human emotion. :oops:
:sharebeer
Nathan Drake
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Joined: Mon Apr 11, 2011 12:28 am

Re: Thinking of Dropping Out of International Stock Funds

Post by Nathan Drake »

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

Image

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!!!
20% VOO | 20% VXUS | 20% AVUV | 20% AVDV | 20% AVES
lostdog
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Re: Thinking of Dropping Out of International Stock Funds

Post by lostdog »

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

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!
Stocks-80% || Bonds-20% || Taxable-VTI/VXUS || IRA-VT/BNDW
fatherjames
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Re: Thinking of Dropping Out of International Stock Funds

Post by fatherjames »

starboi wrote: Tue Jul 27, 2021 12:08 pm
Marseille07 wrote: Tue Jul 27, 2021 11:57 am
MrCheapo wrote: Tue Jul 27, 2021 11:17 am 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.
Lots of posters are US-only, including myself. Neither Buffett nor Bogle believed in ex-US, not sure what other evidence you need.
"Warren Buffett's $6 billion investment in Japanese trading companies is paying off"

https://www.bloomberg.com/news/articles ... king-stock
The article said Buffett invested in just a few commodity type companies. So he was very picky about where he put his money. The rest of us usually buy index funds which can be tough to own mentally when they lag for years. Also you get quite a bit of international exposure owning Coca-Cola, Starbucks, Tesla, IBM, Microsoft, Apple, etc. It is a personal choice and I tried to own international index funds when I started investing thirty years ago but failed due to the same issues you are having with poor performance.

Full disclosure I am not a Boglehead but I am trying to become one now that I am 50 years old.

James
TimeTheMarket
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Re: Thinking of Dropping Out of International Stock Funds

Post by TimeTheMarket »

I'm light international. It's done poorly for a long time and is likely to continue to, IMO. I'm only 15-20% (most I can stomach) because so many advisers seem to recommend it (though certainly not all).

It is difficult to see the next 10-20 years of Europe outperforming the USA in stocks.
Username is not serious :)
Visitor76
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Re: Thinking of Dropping Out of International Stock Funds

Post by Visitor76 »

lostdog wrote: Wed Jul 28, 2021 9:27 am
Visitor76 wrote: Wed Jul 28, 2021 9:25 am
Triple digit golfer wrote: Wed Jul 28, 2021 9:15 am
Visitor76 wrote: Wed Jul 28, 2021 9:07 am
Triple digit golfer wrote: Wed Jul 28, 2021 7:08 am

I agree, and that is to be expected. So you sold them and bought bonds instead?
No, I reallocated the capital from the International funds into my existing US funds. So now I am 100% in US equities and plan to stay the course until I reach my FI number.
So you sold out of international stocks because they were too correlated with U.S. stocks, then bought U.S. stocks instead, which are even more correlated with U.S. stocks.
I sold my International fund because it was a drag on my portfolio (I don't own individual stocks). Then I reallocated my existing portfolio into a growth/value blend.
When will you get back in? If the US index was lagging, would you have dropped that?
I would not drop out of US equities entirely if International was out performing. I see International is being far more volatile than US.

I have no plans of getting back into International; but would consider International funds again if they can produce annual competitive returns with that of the US.
Last edited by Visitor76 on Wed Jul 28, 2021 10:15 am, edited 1 time in total.
Wealth is not about having a lot of money; it's about having a lot of options.
Triple digit golfer
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Joined: Mon May 18, 2009 5:57 pm

Re: Thinking of Dropping Out of International Stock Funds

Post by Triple digit golfer »

TimeTheMarket wrote: Wed Jul 28, 2021 10:06 am I'm light international. It's done poorly for a long time and is likely to continue to, IMO. I'm only 15-20% (most I can stomach) because so many advisers seem to recommend it (though certainly not all).

It is difficult to see the next 10-20 years of Europe outperforming the USA in stocks.
Serious question. Why do you feel it is likely to continue to perform poorly? Remember that anything that you answer, whatever knowledge or facts you bring, is already known by the market and therefore factored into the current price. If it were so easy to know what will perform best or worst, everybody would quickly buy/sell and any advantaged would be arbitraged away before you could blink.

Also, it's all relative. Over the last 20 years, it has had a 4%+ real return. I don't consider that poor performance, but I acknowledge that U.S. has performed significantly better over that time period.
smalliebigs
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Re: Thinking of Dropping Out of International Stock Funds

Post by smalliebigs »

Yeah, so relative to US, the performance was poor
nigel_ht
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Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

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!
Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
smalliebigs
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Re: Thinking of Dropping Out of International Stock Funds

Post by smalliebigs »

nigel_ht wrote: Wed Jul 28, 2021 10:55 am Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
I think it simply is because Jack said "international is not needed, Vanguard said "20% recommended". So there's the discussion. Added to the fact that it's underperforming, so people are thinking it's going to skyrocket any day.
lostdog
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Re: Thinking of Dropping Out of International Stock Funds

Post by lostdog »

nigel_ht wrote: Wed Jul 28, 2021 10:55 am
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!
Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
It's mostly about protecting young/novice investors.
Stocks-80% || Bonds-20% || Taxable-VTI/VXUS || IRA-VT/BNDW
Nathan Drake
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Re: Thinking of Dropping Out of International Stock Funds

Post by Nathan Drake »

Visitor76 wrote: Wed Jul 28, 2021 10:12 am
lostdog wrote: Wed Jul 28, 2021 9:27 am
Visitor76 wrote: Wed Jul 28, 2021 9:25 am
Triple digit golfer wrote: Wed Jul 28, 2021 9:15 am
Visitor76 wrote: Wed Jul 28, 2021 9:07 am

No, I reallocated the capital from the International funds into my existing US funds. So now I am 100% in US equities and plan to stay the course until I reach my FI number.
So you sold out of international stocks because they were too correlated with U.S. stocks, then bought U.S. stocks instead, which are even more correlated with U.S. stocks.
I sold my International fund because it was a drag on my portfolio (I don't own individual stocks). Then I reallocated my existing portfolio into a growth/value blend.
When will you get back in? If the US index was lagging, would you have dropped that?
I would not drop out of US equities entirely if International was out performing. I see International is being far more volatile than US.

I have no plans of getting back into International; but would consider International funds again if they can produce annual competitive returns with that of the US.
So you’ll get in after the price has already gone up?

Okay…
20% VOO | 20% VXUS | 20% AVUV | 20% AVDV | 20% AVES
smalliebigs
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Re: Thinking of Dropping Out of International Stock Funds

Post by smalliebigs »

Protect them? From what? People that are on this forum are already considered very successful (in theory) when it comes to investing/personal finance.
Triple digit golfer
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Re: Thinking of Dropping Out of International Stock Funds

Post by Triple digit golfer »

nigel_ht wrote: Wed Jul 28, 2021 10:55 am
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!
Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
Perhaps you're biased and just reading it that way. Emotion is hard to detect through typed words on an internet forum. I don't know how I come across on here, but in reality I am very light-hearted and don't take much other than work and my family's well-being seriously.
nigel_ht
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Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

smalliebigs wrote: Wed Jul 28, 2021 11:01 am
nigel_ht wrote: Wed Jul 28, 2021 10:55 am Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
I think it simply is because Jack said "international is not needed, Vanguard said "20% recommended". So there's the discussion. Added to the fact that it's underperforming, so people are thinking it's going to skyrocket any day.
Maybe it will skyrocket. Or VTI will crater. Okay, great...but why the need to ridicule others? Do your own thing and be confident about it.
Triple digit golfer
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Re: Thinking of Dropping Out of International Stock Funds

Post by Triple digit golfer »

smalliebigs wrote: Wed Jul 28, 2021 11:06 am Protect them? From what? People that are on this forum are already considered very successful (in theory) when it comes to investing/personal finance.
People often discover this forum by accident when starting out their investing journey and are looking for advice.

The people with thousands of posts are probably successful, but look at all the posters with just a handful of posts. On top of that, there are probably 20x as many non-members lurking, reading these posts right now. I'd love for even one to read one of my posts and take something good from it. A good start would be starting their investing journey with world market cap equities or close to it, and only adjusting from there if they can justify it.
nigel_ht
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Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

Triple digit golfer wrote: Wed Jul 28, 2021 11:07 am
nigel_ht wrote: Wed Jul 28, 2021 10:55 am
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!
Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
Perhaps you're biased and just reading it that way. Emotion is hard to detect through typed words on an internet forum.
Given there are a gazillion international threads here and its not just these two posts I don't think I'm reading it wrong.
nigel_ht
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Joined: Tue Jan 01, 2019 9:14 am

Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

Triple digit golfer wrote: Wed Jul 28, 2021 11:10 am
smalliebigs wrote: Wed Jul 28, 2021 11:06 am Protect them? From what? People that are on this forum are already considered very successful (in theory) when it comes to investing/personal finance.
People often discover this forum by accident when starting out their investing journey and are looking for advice.

The people with thousands of posts are probably successful, but look at all the posters with just a handful of posts. On top of that, there are probably 20x as many non-members lurking, reading these posts right now. I'd love for even one to read one of my posts and take something good from it. A good start would be starting their investing journey with world market cap equities or close to it, and only adjusting from there if they can justify it.
That's your opinion.

It CAN be a good starting point but there are multiple good starting points. Others believe that 20% international is good enough for diversification. Others believe that just doing VTI is good enough to start with.

And post count isn't indicative of success.
nigel_ht
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Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

lostdog wrote: Wed Jul 28, 2021 11:02 am
nigel_ht wrote: Wed Jul 28, 2021 10:55 am
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!
Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
It's mostly about protecting young/novice investors.
So they need protection from Jack Bogle?

Or maybe they should hear all the sides and make their own informed decision rather than just accept your opinion is the correct one.
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Candor
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Re: Thinking of Dropping Out of International Stock Funds

Post by Candor »

lostdog wrote: Wed Jul 28, 2021 11:02 am
nigel_ht wrote: Wed Jul 28, 2021 10:55 am
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!
Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
It's mostly about protecting young/novice investors.
Your quote on another one of these threads regarding 100% US folks:

"It's mainly performance chasing, jingoism, personal ideologies of countries and cultures outside the U.S., lack.of formal education, dogma and crystal balls."

Seems pretty emotional to me.
The fool, with all his other faults, has this also - he is always getting ready to live. - Seneca Epistles < c. 65AD
Triple digit golfer
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Re: Thinking of Dropping Out of International Stock Funds

Post by Triple digit golfer »

nigel_ht wrote: Wed Jul 28, 2021 11:17 am
Triple digit golfer wrote: Wed Jul 28, 2021 11:10 am
smalliebigs wrote: Wed Jul 28, 2021 11:06 am Protect them? From what? People that are on this forum are already considered very successful (in theory) when it comes to investing/personal finance.
People often discover this forum by accident when starting out their investing journey and are looking for advice.

The people with thousands of posts are probably successful, but look at all the posters with just a handful of posts. On top of that, there are probably 20x as many non-members lurking, reading these posts right now. I'd love for even one to read one of my posts and take something good from it. A good start would be starting their investing journey with world market cap equities or close to it, and only adjusting from there if they can justify it.
That's your opinion.

It CAN be a good starting point but there are multiple good starting points. Others believe that 20% international is good enough for diversification. Others believe that just doing VTI is good enough to start with.

And post count isn't indicative of success.
Of course it is my opinion. I would never claim otherwise.

No, post count is not necessarily indicative of success, but I would guess that people with thousands of posts have figured out the basics by now or they never will. They've put in the time here. Someone with thousands of posts is not likely to be swayed by opinions about U.S. vs. international ratio, but a new member may be. The new members are often recent college graduates, people just starting to make enough money to be able to invest, or people reaching mid-career and realizing they haven't gotten the start they would have liked, among others.

Generally speaking, I think it is highly likely that people with 0-10 posts are more likely to be influenced by opinion than people with 1,000+ posts. And yes, that is my opinion as well. :happy
Triple digit golfer
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Re: Thinking of Dropping Out of International Stock Funds

Post by Triple digit golfer »

nigel_ht wrote: Wed Jul 28, 2021 11:20 am
lostdog wrote: Wed Jul 28, 2021 11:02 am
nigel_ht wrote: Wed Jul 28, 2021 10:55 am
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!
Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
It's mostly about protecting young/novice investors.
So they need protection from Jack Bogle?

Or maybe they should hear all the sides and make their own informed decision rather than just accept your opinion is the correct one.
I agree with you. They should hear all sides and make their own informed decision rather than just accepting one person's opinion as correct. That's why I jump in these threads regularly, so that my opinion is available for others to read and digest.
Marseille07
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Re: Thinking of Dropping Out of International Stock Funds

Post by Marseille07 »

Triple digit golfer wrote: Wed Jul 28, 2021 11:22 am Generally speaking, I think it is highly likely that people with 0-10 posts are more likely to be influenced by opinion than people with 1,000+ posts. And yes, that is my opinion as well. :happy
This is correct. Us US camp tried hard to convert TDG and we couldn't do it :sharebeer
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FIREchief
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Re: Thinking of Dropping Out of International Stock Funds

Post by FIREchief »

Nathan Drake wrote: Tue Jul 27, 2021 7:46 pm Image

What a terrible time to invest!
I'll bite. What's the date on that? I can't make it out on my screen.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.
nigel_ht
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Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

Triple digit golfer wrote: Wed Jul 28, 2021 11:23 am
nigel_ht wrote: Wed Jul 28, 2021 11:20 am
lostdog wrote: Wed Jul 28, 2021 11:02 am
nigel_ht wrote: Wed Jul 28, 2021 10:55 am
lostdog wrote: Wed Jul 28, 2021 9:49 am

I invest in U.S. only because it will outperform to infinity and beyond! Thanks Jack, you are right and will be right forever!
Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
It's mostly about protecting young/novice investors.
So they need protection from Jack Bogle?

Or maybe they should hear all the sides and make their own informed decision rather than just accept your opinion is the correct one.
I agree with you. They should hear all sides and make their own informed decision rather than just accepting one person's opinion as correct. That's why I jump in these threads regularly, so that my opinion is available for others to read and digest.
As Candor pointed out, their posts exceed providing opinion and into the ridicule of others. Or perhaps we're just reading it wrong?
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Re: Thinking of Dropping Out of International Stock Funds

Post by wesgreen »

nigel_ht wrote: Wed Jul 28, 2021 10:55 am
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!
Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
Don't discourage them. I think these particular posters give very useful insight into their minds. They certainly prompted me to wonder if I wanted to invest like them, and I am very grateful for the help. Bogle was never afraid to go against the preconceived notions of the industry.
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Re: Thinking of Dropping Out of International Stock Funds

Post by neurosphere »

FIREchief wrote: Wed Jul 28, 2021 11:28 am I'll bite. What's the date on that? I can't make it out on my screen.
1979: https://twitter.com/i/events/1161378717 ... 44?lang=en
If you have to ask "Is a Target Date fund right for me?", the answer is "Yes" (even in taxable accounts).
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Re: Thinking of Dropping Out of International Stock Funds

Post by Triple digit golfer »

nigel_ht wrote: Wed Jul 28, 2021 11:29 am
Triple digit golfer wrote: Wed Jul 28, 2021 11:23 am
nigel_ht wrote: Wed Jul 28, 2021 11:20 am
lostdog wrote: Wed Jul 28, 2021 11:02 am
nigel_ht wrote: Wed Jul 28, 2021 10:55 am

Why does it seem like the international proponents are the most emotional about it on these forums?

Does it really matter to you if someone else loses money being overweight US? Why don't we just wait and see and then you guys can tell everyone else "I told you so"?

There are good points for diversifying into international. There there are post like these that attempt to denigrate everyone else with a differing opinion.
It's mostly about protecting young/novice investors.
So they need protection from Jack Bogle?

Or maybe they should hear all the sides and make their own informed decision rather than just accept your opinion is the correct one.
I agree with you. They should hear all sides and make their own informed decision rather than just accepting one person's opinion as correct. That's why I jump in these threads regularly, so that my opinion is available for others to read and digest.
As Candor pointed out, their posts exceed providing opinion and into the ridicule of others. Or perhaps we're just reading it wrong?
Likely. It seems to me like it goes both ways.
Robot Monster
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Re: Thinking of Dropping Out of International Stock Funds

Post by Robot Monster »

wesgreen wrote: Wed Jul 28, 2021 11:33 am I think these particular posters give very useful insight into their minds.
Did this thread just go Freudian?! Way to jump the sharknado. :wink:
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Re: Thinking of Dropping Out of International Stock Funds

Post by Nathan Drake »

neurosphere wrote: Wed Jul 28, 2021 11:37 am
FIREchief wrote: Wed Jul 28, 2021 11:28 am I'll bite. What's the date on that? I can't make it out on my screen.
1979: https://twitter.com/i/events/1161378717 ... 44?lang=en
At the time US equities looked awful with abysmal performance vs exUS

The best time to invest is when there is blood on the streets
20% VOO | 20% VXUS | 20% AVUV | 20% AVDV | 20% AVES
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Re: Thinking of Dropping Out of International Stock Funds

Post by nigel_ht »

FIREchief wrote: Wed Jul 28, 2021 11:28 am
Nathan Drake wrote: Tue Jul 27, 2021 7:46 pm
What a terrible time to invest!
I'll bite. What's the date on that? I can't make it out on my screen.
August 13, 1979

https://www.bloomberg.com/news/articles ... f-equities

"Besides, in the three years after the cover story appeared, stocks fell and inflation rose, meaning that stocks really were comatose, if not dead. Justin Lahart of the Wall Street Journal—bless his heart—observed in 2005: “And that August 1979 Business Week cover story wasn't quite as wrong as people remember. When it came out, the Dow Jones Industrial Average was at 867. Three years later, it was at 779. Adjust that for inflation, the Dow had fallen 32%."

And

"If financial journalists could truly see the future, we wouldn’t be typing for a living. We’d be on an island somewhere. Other than Manhattan."

Lol.
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Re: Thinking of Dropping Out of International Stock Funds

Post by Marseille07 »

Nathan Drake wrote: Wed Jul 28, 2021 11:41 am
neurosphere wrote: Wed Jul 28, 2021 11:37 am
FIREchief wrote: Wed Jul 28, 2021 11:28 am I'll bite. What's the date on that? I can't make it out on my screen.
1979: https://twitter.com/i/events/1161378717 ... 44?lang=en
At the time US equities looked awful with abysmal performance vs exUS

The best time to invest is when there is blood on the streets
But how was 1979 a good time to invest in US? ex-US soared for another decade thanks to Japan.
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Re: Thinking of Dropping Out of International Stock Funds

Post by Nathan Drake »

Marseille07 wrote: Wed Jul 28, 2021 11:48 am
Nathan Drake wrote: Wed Jul 28, 2021 11:41 am
neurosphere wrote: Wed Jul 28, 2021 11:37 am
FIREchief wrote: Wed Jul 28, 2021 11:28 am I'll bite. What's the date on that? I can't make it out on my screen.
1979: https://twitter.com/i/events/1161378717 ... 44?lang=en
At the time US equities looked awful with abysmal performance vs exUS

The best time to invest is when there is blood on the streets
But how was 1979 a good time to invest in US? ex-US soared for another decade thanks to Japan.
Because exUS soaring was not based on fundamentals. Feels great to cheer while your stocks are going up but in the background P/Es are going to 40+, but it’s a mirage

US stocks did well in the 80s and as we all know much better in the 90s because they were so badly undervalued in the late 70s and early 80s
20% VOO | 20% VXUS | 20% AVUV | 20% AVDV | 20% AVES
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Re: Thinking of Dropping Out of International Stock Funds

Post by UpsetRaptor »

nigel_ht wrote: Wed Jul 28, 2021 10:55 am Why does it seem like the international proponents are the most emotional about it on these forums?
For some of the loudest international proponents, I honestly think some of it is emotional justification for their own investments, and even sometimes just plain sour grapes. Not TDG, but the ones who often resort into mass generalizations / ad-hominems regarding US overweighting, like others are pointing out occurring earlier in this thread.

And I get that. I believe I'm a more intelligent investor than my friend who made a fortune on Apple, and while I'm 90% happy for him, there's that other 10%...
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Re: Thinking of Dropping Out of International Stock Funds

Post by Visitor76 »

Nathan Drake wrote: Wed Jul 28, 2021 11:05 am
Visitor76 wrote: Wed Jul 28, 2021 10:12 am
lostdog wrote: Wed Jul 28, 2021 9:27 am
Visitor76 wrote: Wed Jul 28, 2021 9:25 am
Triple digit golfer wrote: Wed Jul 28, 2021 9:15 am

So you sold out of international stocks because they were too correlated with U.S. stocks, then bought U.S. stocks instead, which are even more correlated with U.S. stocks.
I sold my International fund because it was a drag on my portfolio (I don't own individual stocks). Then I reallocated my existing portfolio into a growth/value blend.
When will you get back in? If the US index was lagging, would you have dropped that?
I would not drop out of US equities entirely if International was out performing. I see International is being far more volatile than US.

I have no plans of getting back into International; but would consider International funds again if they can produce annual competitive returns with that of the US.
So you’ll get in after the price has already gone up?

Okay…
I would rather put money into a fund that is on the way up as opposed to investing said money into an under performer.
Wealth is not about having a lot of money; it's about having a lot of options.
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Re: Thinking of Dropping Out of International Stock Funds

Post by Triple digit golfer »

UpsetRaptor wrote: Wed Jul 28, 2021 11:57 am
nigel_ht wrote: Wed Jul 28, 2021 10:55 am Why does it seem like the international proponents are the most emotional about it on these forums?
For some of the loudest international proponents, I honestly think some of it is emotional justification for their own investments, and even sometimes just plain sour grapes. Not TDG, but the ones who often resort into mass generalizations / ad-hominems regarding US overweighting, like others are pointing out occurring earlier in this thread.

And I get that. I believe I'm a more intelligent investor than my friend who made a fortune on Apple, and while I'm 90% happy for him, there's that other 10%...
I guess I don't get upset about my international having under performed for the following reasons:

1. My benchmark isn't the S&P 500. It is VTWAX or VT. That's the fund I look at most days, although I don't hold it directly. I hold a 60/40 split of U.S./international, among four Vanguard funds: S&P 500 Index, Total Stock, Total International Stock, FTSE all world ex-U.S. index. The reason for the various funds is multiple accounts, tax loss harvesting, yadda yadda.

2. I am happier when U.S. outperforms because I own more of it. I'd rather U.S. return 10% and international 8% than U.S. 5% and international 7%. In the former I make much more money. In the latter, I make less money, but I do better than U.S. only investors. I'd rather make more money than do better than others.

3. There's something that clicks in my mindset about holding a portfolio that is close to what most of the industry recommends and uses and also that is close to what investors actually hold across the world (I know, not necessarily across the U.S., and this part bothered me for a short time). Ultimately, I'd have loved to use a Vanguard target date or LifeStrategy fund and would do so if I only had one account and it was available. In that case, I'd hold the same U.S./international split as I do now. I hold 20% bonds, so essentially my portfolio comes close to replicating the Vanguard LifeStrategy Growth Fund (VASGX). I find it hard to believe that plopping money into that fund over a few decades would turn out bad for an accumulator. That's essentially what I'm doing.
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Re: Thinking of Dropping Out of International Stock Funds

Post by Triple digit golfer »

Visitor76 wrote: Wed Jul 28, 2021 12:26 pm
Nathan Drake wrote: Wed Jul 28, 2021 11:05 am
Visitor76 wrote: Wed Jul 28, 2021 10:12 am
lostdog wrote: Wed Jul 28, 2021 9:27 am
Visitor76 wrote: Wed Jul 28, 2021 9:25 am

I sold my International fund because it was a drag on my portfolio (I don't own individual stocks). Then I reallocated my existing portfolio into a growth/value blend.
When will you get back in? If the US index was lagging, would you have dropped that?
I would not drop out of US equities entirely if International was out performing. I see International is being far more volatile than US.

I have no plans of getting back into International; but would consider International funds again if they can produce annual competitive returns with that of the US.
So you’ll get in after the price has already gone up?

Okay…
I would rather put money into a fund that is on the way up as opposed to investing said money into an under performer.
You can't predict the future. A fund having gone up recently doesn't mean it's on the way up. It means it's gone up.

Also, international has gone up. What you really mean is that you would rather put money into a fund that has performed better in the past.

And that's okay. But most would say that picking funds based on past performance is not a good strategy.
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Re: Thinking of Dropping Out of International Stock Funds

Post by SocalLiving »

Visitor76 wrote: Wed Jul 28, 2021 10:12 am
I would not drop out of US equities entirely if International was out performing. I see International is being far more volatile than US.

I have no plans of getting back into International; but would consider International funds again if they can produce annual competitive returns with that of the US.
This carries a risk of selling low and buying high.

I don't see any issues with people holding only US, or any amount of International or bonds. Investing is personal and your AA should be one that you are comfortable with and can stick with through all the ups and downs. If you think you might sell International today but get back in later if it starts performing better - write down when you would get back in. If you are moving in and out based on recent returns, you will always be selling low.

For me - everything goes back to my IPS. I put a lot of thought into WHY I wanted a certain % in fixed income, international and US. I definitely took into consideration the advice of many on this forum as well as the books and wiki - but the decision was based on what I required from my portfolio in terms of returns and risk.

In the early years I would freak out a bit when bonds or international or US underperformed or crashed. People second guessing allocations on the forum would also provoke anxiety. I even tinkered in the first year or two, and basically it made everything worse because I was then second guessing the second guessing.

For the last 5 years anytime I am tempted to tinker with my portfolio to chase past performance or react to the markets I just go read my IPS. It reminds me of why I decided to invest in International/bonds/US at my AA. I am personally not comfortable with my entire portfolio in US stocks, but totally understand why this is not an issue for a lot of people. I also want to get to 10 years expenses in fixed income before I retire. So I came up with a AA that has bonds and International that works for me through all the craziness.

Figure out the WHY for your AA, and that will help you stick to it.
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Re: Thinking of Dropping Out of International Stock Funds

Post by Yesterdaysnews »

I was enjoying the discussion on the other China thread and felt is was quality. But they locked the thread. Why is the moderation on here so heavy handed? It was a good and interesting discussion.
DB2
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Re: Thinking of Dropping Out of International Stock Funds

Post by DB2 »

anon_investor wrote: Tue Jul 27, 2021 2:37 pm
DB2 wrote: Tue Jul 27, 2021 2:21 pm
gasman wrote: Tue Jul 27, 2021 1:25 pm My international allocation with a tilt towards EM makes me feel like the knight in Indian Jones and the last crusade guarding the grail.
Waiting a very long time.
I've been watching the 4K Blu-ray of these movies lately. :)
IMHO Raiders was the best...
For sure!!
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Re: Thinking of Dropping Out of International Stock Funds

Post by Da5id »

Yesterdaysnews wrote: Wed Jul 28, 2021 4:30 pm I was enjoying the discussion on the other China thread and felt is was quality. But they locked the thread. Why is the moderation on here so heavy handed? It was a good and interesting discussion.
At least in good part because of active moderation Bogleheads is an oasis in the cesspool that is the wider internet. I've been dinged a time or two, but nonetheless very much appreciate what the mods do to keep it civil here. Politics (presumably what happened in the China thread?) rarely leads to a productive or civil discussion related to investing. IMO.
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Re: Thinking of Dropping Out of International Stock Funds

Post by GoneOnTilt »

Da5id wrote: Wed Jul 28, 2021 4:44 pm
Yesterdaysnews wrote: Wed Jul 28, 2021 4:30 pm I was enjoying the discussion on the other China thread and felt is was quality. But they locked the thread. Why is the moderation on here so heavy handed? It was a good and interesting discussion.
At least in good part because of active moderation Bogleheads is an oasis in the cesspool that is the wider internet. I've been dinged a time or two, but nonetheless very much appreciate what the mods do to keep it civil here. Politics (presumably what happened in the China thread?) rarely leads to a productive or civil discussion related to investing. IMO.
^^Well said. Agreed.
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Re: Thinking of Dropping Out of International Stock Funds

Post by Johnathon Livingston »

Look, I get it. I can’t stand ex-US. But I stay in it because I understand diversification across markets. Diversification spreads risk across assets. When one asset is flat and doing nothing another one is firing off. The net result is you have liftoff.

Look at how your portfolio or fund is performing as a whole and don’t fixate on a given asset. Equities are your accumulators. Bonds are your defensive assets and capital preservers. You can add in other diversifiers like REITs or commodities if that’s your thing.

That being said, you don’t have to do market weight. View ex-US as a diversifier if you don’t view it as the rest of the market.

But, the biggest risk is behavioral risk. If you need to go all US to stay invested and not tinker then that’s what you need to do. But just recognize that if the US goes flat you won’t have another equity class that will fire off for you.

Best of luck.
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