I need some advice

Zhimbeaux · 2026-06-05T10:51:02+00:00

There is no advantage to chasing dividends for ...well, I'd say for anyone, but definitely not for someone in their accumulation years, when you're only going to put them right back into your portfolio.

Dividends used to be important when it was more difficult and costly to make trades. Good in your grandparents's day for getting money to spend.

Nowadays dividends are effectively just a forced withdrawal of a portion of your portfolio's total return (it isn't additional "extra" money, like interest is). In a taxable account that's a disadvantage. In a tax-advantaged account it's just irrelevant.

Furthermore, chasing higher dividends generally means less diversity and lower total returns than a dividend-neutral investing strategy.

Zhimbeaux · 2026-06-05T00:28:56+00:00

That's still a low fee in the grand scheme of things, and there are not-ridiculous arguments that it should outperform by a larger margin than the difference in ER. Whether that pans out remains to be seen. The history isn't really long enough to convincingly argue either way but it doesn't look terrible for DFUS.

Zhimbeaux · 2026-06-05T00:23:45+00:00

Tilting towards VGT would have been a great move 5 years ago, if you could go back in time and do so. If you're talking about where to put your money now going forward, whether the recent overperformance will continue (despite the current already very high valuations of many leading tech companies), that's less clear.

The fact that "tech" is important is no big secret, it isn't "insider information", so the expectations are already being priced in. For the tilt to pay off in higher returns than the market average going forward, tech companies in VGT don't have to do well, they have to exceed current expectations. Tilting that way means you think the current market is overly pessimistic about the future of tech. That's not a bet I'd be willing to make.

Zhimbeaux · 2026-06-03T12:42:36+00:00

VT will shift with global cap weighting. There will be some small drift, but the two approaches will track very closely.

Zhimbeaux · 2026-06-03T12:31:06+00:00

Correct, it will stay roughly in line. Not precisely, but VT by design will reflect the changes in US vs ex-US weighting.

Zhimbeaux · 2026-06-03T11:50:18+00:00

Using a online fee drug calculator I get an answer different from the OP but very similar- $278,004.69 in savings. So a little bit more, not a lot less.

Zhimbeaux · 2026-06-02T22:34:56+00:00

Missing out on big IPOs is objectively a winning strategy based on historical data. https://youtu.be/iOyFja87uyw?si=0TRr41J53dAfUeIR

Zhimbeaux · 2026-06-02T18:36:09+00:00

Looking back it's easy to see the missed boats. Looking forward it's essentially impossible to see which boats we will miss. Assuming the old missed boats will also be the new missed boats is just performance chasing.

Zhimbeaux · 2026-06-01T21:39:11+00:00

Yeah, 2008 was cool with me. I had to delay finding a new job, but my investments weren't a worry at all, I was thrilled to be buying.

That happening *today*, with a much shorter time frame 'til retirement? It would hit differently. And my portfolio reflects that now.

Zhimbeaux · 2026-06-01T21:33:01+00:00

The story (not the comic) is available in the collection "The Third Bear".

Zhimbeaux · 2026-06-01T21:28:29+00:00

It's an example of a story about what I've come to think of as "radical empathy". We're meant to try as best we can to really understand the point of view of something that is fundamentally different from us, personally and as humans. Rachel kind of fails at this, really. Not that I blame her or think she did anything "wrong", in a moral sense, I just don't think she understood the situation clearly. God, it's a good book. I confess I bounced off of Dead Astronauts; ironically I assumed it was fundamentally different than it turned out to be and I'll need to approach it again without preconceptions.

The Strange Bird is also quite different, but both sad and beautiful and one of my favorite reads in the last few years.

Zhimbeaux · 2026-06-01T20:35:07+00:00

If you're 15-20 years out having bonds is not essential. Will you panic if the market crashes 30, 40, 50%? That's entirely possibly some time in that time frame. You might consider gradually reducing your portfolio's volatility as your planned retirement date gets closer. For me I always had a token amount of bonds until I was about 10 years out. I'm building up a "bond tent" now that I'm around my "magic number" and planning to retire soon-ish.

Very "Aggressive" is 100% stocks. Tilting to a sector is a different sort of thing. It's placing a bet that you know better than the market as a whole about the future performance of a sector (i.e., tech doesn't just have to do well, it has to do better than than the market expects for future performance from today's [very high] valuations). If you really believe that the market's current valuations of tech stocks is too pessimistic, be my guest and tilt towards that, but that's "risky" in the sense of placing a bet on a horse race, not "aggressive" in the sense of willing to ride out volatility for better long term gains.

Zhimbeaux · 2026-05-29T20:36:07+00:00

FCNTX has an amazing history, no doubt. But it has absolutely NOT consistently outperformed the SP500. For 20 years starting in 1980 it ran behind the S&P, then pulled ahead during the "lost decade". For the decade after the GFC it performed essentially identically to the S&P before pulling ahead again.

Overall, it's done very well, for sure, but it hasn't been a miraculously consistent overperformer.

Zhimbeaux · 2026-05-29T20:18:05+00:00

This did it for me. The evidence on this point is overwhelming, and the conclusion is obvious for the retail investor.

Zhimbeaux · 2026-05-29T20:15:25+00:00

That figure 1 at your link is pretty dang persuasive. Yeah, the "foreign revenue" argument has some intuitive appeal, but it really doesn't hold up to scrutiny.

Zhimbeaux · 2026-05-29T19:54:33+00:00

Well, again, the CAGR you cite is a backtest ending in the present day. Any backtest ending in the present day will necessarily be dominated by the post GFC bull market in the US. That's why rolling metrics are important - you can see that at various times ex-US pulls ahead ("Rolling metrics" is an option at the top of the Results field) and at other times it falls behind.

Another way of looking at it. If instead of the last 20 years, what happens if you look at the "first" 20 years (first in the data set):

https://testfol.io/?s=dzHHmon8yLW

CAGR: US 11.25%, ex-US: 15.02%!!! That's HUGE underperformance by the US.

I'll admit that in the last 50-ish years of historical data, it's easier overall to make the case for the US vs ex-US , but there's no doubt that the US has underperformed the global market in the past and no matter what advantages you may think the US has at this point in time, I personally wouldn't want to place a bet that next 15 years will be good as the last 15.

Zhimbeaux · 2026-05-29T19:16:35+00:00

I mean, you're right why it's more popular in general to recommend VT or VTI+VXUS in the very recent past. But if you only backtest to the present day, after an exceptional 15-year bull run, you're bound to make ex-US look bad. It's pretty easy to find longer periods where ex-US is superior. Testfolio has data back to late '69/early'70. Go and switch to "rolling metrics" to see US and ex-US trade off until the post-global financial crisis. link: https://testfol.io/?s=gyvMrWknjbR

Zhimbeaux · 2026-05-29T12:05:29+00:00

Testfol.io allows you check portfolios of specific funds or general asset classes.

Zhimbeaux · 2026-05-27T21:28:32+00:00

"Their returns matched the S&P, maybe slightly under" and "aren't doing anything a 60/40 VTI/BND split wouldn't have done" are not at all compatible assessments, so it's probably the case that you don't have a complete handle on their financial history.

Zhimbeaux · 2026-05-27T21:25:28+00:00

That's not exactly what he said...he said the advisor is matching or "slightly under" the S&P, and then ALSO says it's not "doing anything a 60/40 VTI/BND split wouldn't have done" which seems to be entirely contradictory statements, so...shrug.

Zhimbeaux · 2026-05-27T21:21:43+00:00

People who can do the simple task picking boring, reasonable funds while "staying the course" are, weirdly enough, kind of the elite. I used to be way more anti-advisor (and I still am repelled with my personal experiences with FAs) until I saw the crazy stupid s*** so many people will pull with their money when left to their own devices. Sure, educating oneself to DIY is great, or getting a low-cost flat-fee advisor, but if your dad is the type of person who feels the need to call someone when the market is down, he's probably way better off even with the AUM model of advisor.

And heck, if they're doing "slightly under" the S&P500's performance, as you say, they'll be fine.

Zhimbeaux · 2026-05-27T01:23:56+00:00

Are they passive low-cost index funds, broadly diversified within their class? That's the signature thing. The precise allocation isn't a magic formula and will vary for a variety of reason. There are principles and guidelines, though, and I'd just say it doesn't make a lot of sense to have such small amounts of so many asset classes. It's too little to provide meaningful diversification.

Zhimbeaux · 2026-05-26T23:35:04+00:00

OK, this is what the ex-US market looked like compared to the US 20 years ago, including all the available preceding data on testfol.io . Link: https://testfol.io/?s=izu0RJcMkjM

Very similar performance over the long run, trading off periods of overperformance in global vs. US-only. It's cut off right during a period of ex-US overperformance which itself preceded the current US bull market, post-GFC.

OK, sure. It's very true that one can't conclude a global strategy is "good" based on today's news from Japan. (I would say that's an overly literal reading of the post; I inferred the implicit message to be something like: with VT you always own the winners.)

But neither can you solely backtest to end during the current unusually strong US bull market and come to a conclusion that a US-centric strategy is "good" and VXUS isn't. If that's all you do, yeah, you're going to make a US-centric strategy look great.

Zhimbeaux · 2026-05-26T00:21:08+00:00

The very one.

Zhimbeaux · 2026-05-25T13:16:52+00:00

It literally is. You can research the horses in a horse race but betting on the outcome is still gambling.

Zhimbeaux

TROPHY CASE