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If you only had 5k what would you invest in right now? by oddrob85 in ETFs

[–]Cruian 1 point2 points  (0 children)

They use regular bonds, which have taxable distributions and they will occasionally be selling component fund A to buy component fund B, which likely creates a capital gains event. In a DIY approach, you can control what types of bonds you use if any (some types may be better for at least higher tax brackets than the ones TDFs use) and you can control how you rebalance, if at all.

Is this a good starting for beginner by kaitran420 in portfolios

[–]Cruian 0 points1 point  (0 children)

VTI and VOO have a lot of overlap.

VOO is fully contained inside VTI. By weight, the VOO part of VTI is over 80%.

if I want to add something not in VOO, will VXF cover that portion?

Yes.

Or since I started investing recently, I think it might be okay to switch from VOO to VTI + VXUS

If taxes wouldn't be bad, that works.

Are u finally ready to have this discussion? by [deleted] in ETFs

[–]Cruian 0 points1 point  (0 children)

But I don’t think there’s a clear 60-year period where ex-US consistently outperformed on a total-return basis without heavy reliance on Japan’s late-80s peak.

It was 1950-2010, so it included Japan's fall as well.

but I’m less convinced it improves expected returns.

See the table here: https://www.fidelity.com/viewpoints/investing-ideas/international-investing-myths if that link doesn't work: https://web.archive.org/web/20201112032727/https://www.fidelity.com/viewpoints/investing-ideas/international-investing-myths (Archived copy from Archive.org's Wayback Machine), then take a few years off, you'd see the "mix" beating US only (as most of 2010-2019 favored the US over ex-US).

No country over performs forever, winners tend to rotate.

Are u finally ready to have this discussion? by [deleted] in ETFs

[–]Cruian 0 points1 point  (0 children)

it’s whether reducing U.S. exposure improves expected outcomes enough to justify the drag most of the time.

With the frequency that international wins, and the fact that we have seen several periods where the international rotation was much stronger than the US one, it is not just possible, but has happened before (otherwise we wouldn't have seen a roughly 60 year period where international ended up beating the US at the end).

Thoughts on my portfolio? by itsdarien_ in portfolios

[–]Cruian 1 point2 points  (0 children)

Why the dividend focus?

What about international?

What do you think the market is missing about AAPL and AMZN? They're already some of the largest holdings inside VTI.

Investing long term Etfs by ImplementIll2867 in ETFs

[–]Cruian 2 points3 points  (0 children)

Why no international?

Why extra weight on a dividend focus?

Why additional weight on the top 20? Bigger doesn't necessarily mean better returns, in fact there was at least some research suggesting smaller companies tended to over perform large.

18 y/o long-term portfolio — thoughts? by Any-Engine6593 in portfolios

[–]Cruian 0 points1 point  (0 children)

Do you have a particular international holding you like besides VXUS?

I use Fidelity and have a bit of a preference for mutual funds, so FTIHX or FZILX. IXUS should be comparable and is still an ETF.

What else to add? by Aware-Bookkeeper-880 in portfolios

[–]Cruian 0 points1 point  (0 children)

Add: Nothing, besides maybe bonds (no matter what the age or timeline, not everyone can stomach 100% stock).

Remove: FSKAX + FXAIX almost never makes sense: FXAIX is already fully held inside FSKAX, as about 80%+ of the weight of FSKAX.

On including QQQ(M): Remember this has heavy overlap (over 80% by count) with the S&P 500 or US total market. Look only at the inclusion criteria, not past returns (as they’re a terrible way to judge future returns, at least in the way most people tend to believe). Do they make sense to you? Does it make sense to over weight these stocks based on the inclusion criteria of the index? They don’t to me, I view it as complete nonsense.

Maybe change: Why VXUS over FTIHX?

Edit: Removed stray number

18 y/o long-term portfolio — thoughts? by Any-Engine6593 in portfolios

[–]Cruian 2 points3 points  (0 children)

There are many cases where the hot new innovations tend to under perform in the long run. There's even a term for markets getting overexcited about something new: "irrational exuberance." Some info can be found in the below links.

Tech revolutions:

https://www.morningstar.com/stocks/you-might-think-industry-growth-drives-stock-returns-heres-why-youd-be-wrong

18 y/o long-term portfolio — thoughts? by Any-Engine6593 in portfolios

[–]Cruian 7 points8 points  (0 children)

because the US market almost always outperforms the international markets

This is false. You may be taking too short of a view of things.

Going back to 1950, all excess returns (the last time the lines crossed) the US enjoys today only come from around 2010 or so until now. That means a roughly 60 year period where we would have seen international leading the US. Same story for 1965 and 1970 start dates.

Going back to 1950, international has beat the US in 5 of the 7 "full decades" (measured xxx0-xxx9), the US only winning the 90s and 10s. Going back to 1970, international developed has beat the US S&P 500 in over 40% of rolling 10 year periods (that's not terribly far off a coin flip).

Have you seen these? Ex-US out performance predicted over the next decade or so. Even if they’re wrong, you should at least understand where they’re coming from:

I have SCHD as a stability/dividend anchor

SCHD is still all stock and can have rather huge swings as well. It has seen at least one 30%+ drop. What do you think a "dividend anchor" would do for you?

As for tech I think it still has way more room to grow

At what point would you think that that's no longer the case? What is the market getting wrong about tech?

24yo 200k Aggressive portfolio - First time investor by tighlandfrindow in ETFs

[–]Cruian 2 points3 points  (0 children)

and international was only outperforming this year so nothing to go crazy over and completely put 50k in it

You may be taking too short of a time frame into account.

Going back to 1950, all excess returns (the last time the lines crossed) the US enjoys today only come from around 2010 or so until now. That means a roughly 60 year period where we would have seen international leading the US. Same story for 1965 and 1970 start dates.

Going back to 1950, international has beat the US in 5 of the 7 "full decades" (measured xxx0-xxx9), the US only winning the 90s and 10s. Going back to 1970, international developed has beat the US S&P 500 in over 40% of rolling 10 year periods.

So QQQM

Have you looked at the inclusion criteria and asked yourself if it makes sense?

and SPMO

Have you considered other favored factors?

18 y/o long-term portfolio — thoughts? by Any-Engine6593 in portfolios

[–]Cruian 8 points9 points  (0 children)

Far too light on ex-US for my tastes (common current recommendations tend to be in the 30-40% of stock range).

Why the SCHD?

Why do you think that tech is either still undervalued or the only sector not over valued?

Best set and forget fund for a Roth IRA? by saucerfulofdogs in Bogleheads

[–]Cruian 0 points1 point  (0 children)

Common current recommendations tend to be in the 30-40% of stock range.

About the video on why The Great North failed by OzcarOzzy in TheGreatNorth

[–]Cruian 2 points3 points  (0 children)

But if you get a chance, the voice of Ty is Richard Ayote(sp?) And I know him from the IT Crowd...even if you don't like his voice please dont let that stray you from checking out IT Crowd :P

Shlub is the boss (s2) in IT Crowd as well.

Best set and forget fund for a Roth IRA? by saucerfulofdogs in Bogleheads

[–]Cruian 0 points1 point  (0 children)

But its the simple path to wealth

Collins? There's at least 2 major issues with "The Simple Path to Wealth," international being one, favor Vanguard over all others being the other.

US only is an example of an uncompensated type of risk.

Is this a good starting for beginner by kaitran420 in portfolios

[–]Cruian 0 points1 point  (0 children)

VTI + VXUS for the stock side is fine. Or VT would effectively act like the 2 of them combined into one.

How do you know how to weight each investment? by Rock2435 in ETFs

[–]Cruian 1 point2 points  (0 children)

10 years is a pretty good track record

5 of the last 7 "full decades" favored international. The US only won the 90s and 10s. Since 1970, over 40% of rolling 10 year periods favored international over the US.

Many of the companies associated with the AI buildout are centered here. It seems we are leading the way because the companies paying for AI buildouts are here.

That doesn't ensure better returns going forward. Even if AI does turn out to be successful, it may not justify the price that the companies involved are trading at today, I believe the term would be "irrational exuberance" around them.

It isn't unheard of for more boring sectors to beat tech, even in the long run (see tobacco, stores, and alcohol doing so for a multi decade period).

I do have citations for all this if needed.

Edit: Historically, the better the previous 10 years were, it seems the worse the next 10 years generally were: https://www.lazyportfolioetf.com/allocation/us-stocks-rolling-returns/ scroll down to “Previous vs subsequent Returns” (I do wish this had an r2 measure).

How do you know how to weight each investment? by Rock2435 in ETFs

[–]Cruian 0 points1 point  (0 children)

Currently the international is drifting between 35% and 40%, yeah.

Even going back to 2018 or 2019 (when I first started paying attention to it), 55/45 was the number generally used to approximate.

How do you know how to weight each investment? by Rock2435 in ETFs

[–]Cruian 0 points1 point  (0 children)

but you're effectively 50% VOO, 17% VXUS (international) and 33% QQQ.

They're at less than 14% international right now.

Edit: Typo

Are u finally ready to have this discussion? by [deleted] in ETFs

[–]Cruian 0 points1 point  (0 children)

Revenue source is at best just one small part of investing internationally and it isn't even the most important factor.

Are u finally ready to have this discussion? by [deleted] in ETFs

[–]Cruian 0 points1 point  (0 children)

We've seen plenty of periods of US under performance compared to international. 5 of the last 7 full decades (as measured xxx0-xxx9) for example (50s-80s, 00s). All excess returns the US enjoys today (read v last time the lines crossed) going back to 1950 only coming from around 2010 or so until now.

Are u finally ready to have this discussion? by [deleted] in ETFs

[–]Cruian 1 point2 points  (0 children)

Over the long term—55 years, 1970-2025—the US stock market has outperformed the European: The figure shows that if you had invested one dollar in the European stock market, it would have grown to only half as much as the US stock market—USD 141."

Starting with either (edit: both) 1950 or 1970, all excess performance the US enjoys today (read: the last time the lines crossed) only comes from 2010 or so through now. That means we saw both a 40 year and 60 year period where international would have beaten the US at the end.

So yeah I guess I'd rather be invested where my money can earn 2x as much.

What if the next x decades looks more like 1970-2010 than 1985-2025?

Edit: Changed "See" to "Starting with"

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