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sschullo

How Did Your Portfolio Perform In 2009?

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Ill start.

Before distributions, our portfolio grew by 12%. After distribution, 9%.

 

70% bonds (GNMA, Treasuries, Intermediate Investment grade, TIPS, iBonds)

18% Stock funds, all indexes

12% Corporate Bonds

 

Participate in a survey and see what other investors did:

http://www.bogleheads.org/forum/viewtopic....p=631274#631274

 

 

 

My portfolio grew by 34%.

 

All stock funds since I am still very young. Now, need to figure out how I want my asset allocation to be for 2010.

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Ill start.

Before distributions, our portfolio grew by 12%. After distribution, 9%.

 

70% bonds (GNMA, Treasuries, Intermediate Investment grade, TIPS, iBonds)

18% Stock funds, all indexes

12% Corporate Bonds

 

Participate in a survey and see what other investors did:

http://www.bogleheads.org/forum/viewtopic....p=631274#631274

 

 

 

My portfolio grew by 34%.

 

All stock funds since I am still very young. Now, need to figure out how I want my asset allocation to be for 2010.

 

 

DK,

Let us know what you decide.

We rebalance from bonds to equities since our plan call for up to 30% equities. We will do some more as time goes on.

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Our overall financial portfolio went up 18% in 2009. But it dropped 18.8% in 2008, so we haven't fully recovered. My wife begins monthly withdrawals from her VG IRA Wellesley fund starting this month. I am doing monthly withdrawals from my 401k fund (Federal TSP), so far things are going up faster than withdrawals, our annual withdrawal rate is under 4%. All looks good on paper, we'll see how this adventure of retiring goes, 2009 was the first full calendar year we were both retired.

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Up 21%. What a relief from 2008!

 

This decade has been very challenging. I have continued to dollar cost average each year, so I am hoping that all will work out in the long run.

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Okay. Here is what my portfolio might look like in 2010. I am betting the world's market does better than the U.S. market in 2010. Let me know what you think. I haven't changed my allocation yet until I get feedback. Thanks

 

 

20.00% Vanguard Small Cap Index Instl (VSCIX)

10.00% American Funds Capital World G/I R6 (RWIGX)

10.00% Vanguard Institutional Index (VINIX)

10.00% DFA Emerging Markets I (DFEMX)

10.00% Vanguard Mid Capitalization Index Ins (VMCIX)

10.00% Vanguard Inflation-Protected Secs Instl (VIPIX)

10.00% DFA Intl Small Company I (DFISX)

10.00% Dodge & Cox International Stock (DODFX)

10.00% American Funds EuroPacific Gr R6 (RERGX)

 

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Okay. Here is what my portfolio might look like in 2010. I am betting the world's market does better than the U.S. market in 2010. Let me know what you think. I haven't changed my allocation yet until I get feedback. Thanks

 

 

20.00% Vanguard Small Cap Index Instl (VSCIX)

10.00% American Funds Capital World G/I R6 (RWIGX)

10.00% Vanguard Institutional Index (VINIX)

10.00% DFA Emerging Markets I (DFEMX)

10.00% Vanguard Mid Capitalization Index Ins (VMCIX)

10.00% Vanguard Inflation-Protected Secs Instl (VIPIX)

10.00% DFA Intl Small Company I (DFISX)

10.00% Dodge & Cox International Stock (DODFX)

10.00% American Funds EuroPacific Gr R6 (RERGX)

 

If I read that right you have 10% bonds 90% equities? 40% US, 50% Intl equities with a heavy small cap weighting?

Is this your whole AA? That is an exciting AA, sort of like 'betting the rent'.If I were young & brave I would consider something like this but at my age I'll stick with VG Wellesley and other balanced funds and a smattering of stocks & ETFs that generate dividends.

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Yeah. Just looking at that AA is very exciting to me. I'm thinking about taking the bond and switching it to RLLGX, which is a world smallCap fund

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Okay. Here is what my portfolio might look like in 2010. I am betting the world's market does better than the U.S. market in 2010. Let me know what you think. I haven't changed my allocation yet until I get feedback. Thanks

 

 

20.00% Vanguard Small Cap Index Instl (VSCIX)

10.00% American Funds Capital World G/I R6 (RWIGX)

10.00% Vanguard Institutional Index (VINIX)

10.00% DFA Emerging Markets I (DFEMX)

10.00% Vanguard Mid Capitalization Index Ins (VMCIX)

10.00% Vanguard Inflation-Protected Secs Instl (VIPIX)

10.00% DFA Intl Small Company I (DFISX)

10.00% Dodge & Cox International Stock (DODFX)

10.00% American Funds EuroPacific Gr R6 (RERGX)

 

If I read that right you have 10% bonds 90% equities? 40% US, 50% Intl equities with a heavy small cap weighting?

Is this your whole AA? That is an exciting AA, sort of like 'betting the rent'.If I were young & brave I would consider something like this but at my age I'll stick with VG Wellesley and other balanced funds and a smattering of stocks & ETFs that generate dividends.

 

Yakers,

DK said he was very young so the 90%-10% equity to bond split is appropriate. Of course it would never be appropriate for a nearly retired or in retirement, unless that person wants it to be passed on to descendents.

 

DK,

You have good diversification as yakers pointed out. You have done your homework!

Some questions and couple of comments:

1. What percentage is tax deferred and what percentage is taxable money? Make sure your taxable allocation is with equities.

 

2. You have two international funds. What was the reason to specialize in a Europacific fund. I would think the international funds have included the Europacific sector already (Seeking ways to simplify and to eliminate the American fund that may charge commissions).

 

3. I would keep the ten percent bond fund and slowly increase that portion as you get older, doesn't have to be TIPS. Bogle says that your age should equal your bond allocation. Its not a hard rule, but a general rule of thumb.

The bond fund is important because it can be used to rebalanced so if your equities grow and your bond fund will shrink as a result, you want to trim from the high flying equities and purchase into your bond fund. It keeps your portfolio balanced between equities and bonds and you reap some of the gains from your equities. Some people would suggest a MM fund to rebalance. Choice is yours.

 

4. Do you have a large cap domestic fund? A REIT fund?

 

Anyway, just some ideas to keep building your portfolio as time goes on.

 

Good job and explains how you got 34%.

Steve

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1. All the funds I listed above will be tax deferred. It's the choices that I picked from Pension2.

 

2. I picked EuroPacific to get more exposure to the pacific rim area while trying to lower my allocation to U.S.

 

3. The reason for the bond is what you stated there. If bond increases and equity decrease, it'll give me a chance to sell the bond when it's higher to get equity fund when equity is lower.

 

4. Yeah, there is large cap and reit fund.

 

 

My contribution to my portfolio was half in 403 and half in roth ira. my roth had Vanguard Capital Value because I liked the fund investment idea since it invested in stocks that they believed were undervalue and because of the crash in 2008, i thought this fund was perfect. This returned 50% for me. My 403 returned was 20%, which was invested in 35% foreign fund, 35% domestic small cap, and 30% domestic large cap.

 

thanks for your feedback

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DK,

Wanted to post history of VG Captial Value fund for readers to know that this fund is very risky and volatile. While you made a great call and got 50% so far, you have earned bragging rights.

Two problems that readers might have with this information:

1. Some readers might think to jump in now thinking that they will also get 50% (good thing its closed for now).

2. This fund is not a good choice for long term planning.

 

https://personal.vanguard.com/us/funds/snap...;FundIntExt=INT (Note to webmaster: the automatic editor of the Invision Power Board is very annoying. I cannot get the link right because it deletes the word

s h o t in the URL). Readers have to go to the Vanguard website and look for Capital Value, sorry I could not find a working link.

 

I think the rest of your portfolio is fine. I am just concerned about volatile sector funds that have great short term runs. If its a tiny part of your portfolio, thats fine, you know what you are doing and you have youth on your side, why not take some risks to learn about it. One can read and read about risks, but until one feels the effects of risks, both gains and loses, one does not really know.

 

I am just the old burnt out investor who has seen some great funds come and go and the investor is left with little or nothing. I remember Fidelity electronics made 144% in 1999. I really ended up with 12% when I finally got out of that horrible fund and I consider myself lucky that I made any money.

 

Have a great weekend,

Steve

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Mr. Schullo

 

In placing equities in a taxable account to those who have multiple accounts, what if you have an equity mutual fund that is tax inefficient? Or are we assuming that we are using index funds if we are using mutual funds since tax inefficiency is not an issue?

 

I saw one study that indicates that even for a tax inefficient mutual fund the taxable portfolio was the proper placement, but I am curious as to your thoughts.

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DK.

 

Did you ever read the story of Janus Fund Fiasco when Tom Bailey was running the shop?

 

Take it from me. I had over a million dollar portfolio a few years back with a high flying portfolio similiar to yours

and I paid the price twice. If I were you I would reduce the risk of this portfolio now .

 

In investing, time is as important as contributions made. It takes years to get money back when the market plummets.

 

Slow and steadywith boring funds will get you more money in the long run.

 

 

You are betting world markets will do better than domestic. I totally disagree . International funds sound great until they go south and then you've lost a bundle. Reduce your exposure to 25%

 

 

My Two cents

 

Tony

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Mr. Schullo,

Hi Benefits geek,

You may call me Steve.

 

In placing equities in a taxable account to those who have multiple accounts, what if you have an equity mutual fund that is tax inefficient?

I don't understand what you mean by "multiple accounts"?

A tax inefficient equity mutual fund is a managed fund, so if you have after tax money in a managed account it is tax inefficient? don't understand your question.

 

Or are we assuming that we are using index funds if we are using mutual funds since tax inefficiency is not an issue? We use index funds for both tax deferred and taxable accounts not because they are tax efficient, its because of low costs, diversification across the broad domestic and international economies. We strive for the benchmarks, never try to beat them. You are right tax inefficiency is not an issue with tax deferred money, if that is what you meant.

 

I saw one study that indicates that even for a tax inefficient mutual fund the taxable portfolio was the proper placement, but I am curious as to your thoughts.

I don't know what study you are citing, but no, the taxable portfolio should be with tax efficent, passive or index funds. Taxes will be lower because there is almost no trading.

 

Have a good day,

Steve

 

 

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Thanks, Steve. The article summarizing the variouys studies is in the attached link:

 

http://www.tiaa-crefinstitute.org/pdf/rese...dialogue/85.pdf

 

The issue I am referencing is at the begining of page 7. Sorry if I was not articulate about it, this equity investing in taxable accounts and bond investing in tax-deferred accounts is new to me as I always thought that one should diversify among equity and bond accounts in a tax-deferred retirement plan.

 

 

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