Here’s a condensed May 2013 update for my Beat the Market Experiment, a series of three portfolios started on November 1st, 2012: $10,000 Passive Benchmark Portfolio that would serve as both a performance benchmark and an real-world, low-cost portfolio that would be easy to replicate and maintain for DIY investors. $10,000 Beat-the-Benchmark Speculative Portfolio that [...]
Here is a check-in on the trailing 10-year total returns for the David Swensen model portfolio, courtesy of ETFPM.com. Last update was in 2011. As a reminder, here is the model portfolio asset allocation with representative ETFs: 30% Domestic US Equity (VTI) 15% Foreign Developed Equity (VEA) 10% Emerging Markets (VWO) 15% Real Estate (VNQ) [...]
In many investing books such as David Swensen’s Unconventional Success or Bill Schultheis’ The Coffeehouse Investor, you may see model portfolios that include an allocation to smaller companies and/or real estate investment trusts (REITs). Historically, adding these less-correlated asset classes have improved a portfolio’s overall return while reducing volatility. Author and portfolio manager Rick Ferri [...]
Motif Investing is a new brokerage firm that is unique in that it lets you buy an entire basket of up to 30 stocks for only $9.95 per trade. I previously thought that this would be useful to creating your own “custom ETF” of whatever you want, for example dividend stocks. This week, they rolled [...]
Halfway Update – 5 Years Later! Carol Loomis has posted the 5-year update in Fortune of the $1,000,000 index fund vs. hedge fund bet. Halfway through the 10-year bet (1/1/08 to 12/31/17), the Vanguard S&P 500 index fund backed by Buffett is up by 8.69%. The group of hedge funds hand-picked by Protégé Partners are [...]
It’s time for a end-of-year checkup on the ole’ portfolio, as I’m afraid that I’ll forget about it between Christmas and New Year’s. There isn’t much change to my investment portfolio itself, the target asset allocation is the same, and the specific fund holdings are pretty much the same. I’m closer to 70% stocks and [...]
A reader recently told me that he was no longer investing in the stock market after seeing the chart below from the Savings Bond Advisor. It shows the total portfolio value after investing equal monthly amounts in either the S&P 500 stock market index or Series I US Savings Bonds. The time period is from [...]
Last week, I shared a chart that showed how a diversified portfolio that was rebalanced regularly still managed to nearly double in value over the last decade. Here’s another similar finding based on the David Swensen portfolio as compiled by an advisor group called ETF Portfolio Management. Swensen manages the Yale University endowment and wrote [...]
Mark Cuban recently had a post on his blog called Wall Street’s new lie to Main Street – Asset Allocation. In it, he quotes a recent newspaper article that presents this model asset allocation: 15% in an S&P 500 index fund 5% in a small-capitalization value fund 20% in a diversified international stock fund 5% [...]
Asset allocation (AA) is an important part of portfolio design, and I like pinning down a target asset allocation for personal reference. This helps keep me focused as my portfolio shifts over time and makes it easy to re-balance back. For some educational posts on this topic, please refer to my asset allocation starter guide. [...]
New start-up website Betterment.com wants to make investing more easy… imagine something as simple as your existing savings account but with higher returns. Too good to be true? How does it work? At it’s very core, Betterment is a standard brokerage account, like E*Trade or Scottrade, which holds stocks and bonds in the form of [...]
If you don’t know the name David Swensen, he is an investment manager who is best know for managing Yale Universities huge endowment. What makes him interesting is that even though he does invest in some hedge funds and private equity, he doesn’t believe that the common investor should try to emulate this. An excerpt [...]
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