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I want to drop a huge thanks to investment goons in general as well as whomever I took seriously some years ago when I started a roth and stumbled across their suggestion of VASGX. That led me down the path of researching Vanguard and their funds, and my retirement savings have benefited as a result. Okay now real talk: are the zero-fee Fidelity funds a trap or what? The price is right, and their performance against similar funds from rival brokerages tends to be comparable, but I can't help but worry their management is too passive or they're quietly siphoning profits elsewhere.
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Jan 9, 2021 19:56
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I think it was on the Bogleheads forum where someone expressed anxiety over their allocations because they seemed simultaneously too risky AND too safe. Someone else chimed in that that's when you know you've found the right ratio for you. Am I understanding REITs correctly in that they tend to pay healthy dividends but attract lots of tax (and are therefore ideal for a Roth IRA), while REIT ETFs offer greater diversity at the expense of lower payout? Similar question for bonds vs bond ETFs in America - government bonds don't take a hit from state nor federal taxes, right? It looks like (nearly all) bond ETFs don't get such a break.
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Jan 13, 2021 19:56
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Sanguinia posted:I hope every person gets to feel that feeling I did earlier today someday when they look at their setup for retirement and realize the situation may not be totally hopeless. A slice of my Roth was planted in Nintendo as soon as the Switch was announced, based on how it seemed unique and superior to the competition in several ways (yes I am a giant nerd). I kind of forgot about it until late last year, when I checked on my long-term investments and saw NTDOY had more than tripled. Then, keeping in mind how earnings reports often cause a dip in company value even when expecting good news, I ejected from my position just before it started dipping over 3.5% to date. I'm all about buy and hold, but this particular mountain-followed-by-pothole seemed too apparent not to hop. So, yeah. Feels good.
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Jan 29, 2021 21:32
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What if the profits were spread across my indexes?
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Jan 29, 2021 22:03
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Pennywise the Frown posted:Hi thread. You guys helped me out huge in maybe 2014 with investing. I know nothing about investing and you told me to get a Vanguard account, get VASGX and VTSAX. Well, it turned $18,000 into $38,000 by me sitting here doing nothing. Thank you for that. I haven't been paying attention to it at all lately. Hell yeah, 2014 VASGX buyer! It turned my $6,500 into $11,227 in my roth, then I meddled around and converted it into an identical mix of FSKAX / FTIHX / FUAMX for the lower expense ratios (though bond indexes swap roles over time between taxable-friendly and untaxed-friendly). If you test an array of time ranges for getting into the market, you get the following best-to-worst case scenarios: A) At the best possible time B) Chucking everything in at the moment C) Dollar Cost Averaging throughout the year D) Chucking everything in at the worst possible moment Note that, even if you accidentally wind up doing D, you will be primed for the bounce and more than likely come out ahead. Meanwhile, C will more than likely dilute your gains simply because of lost time.
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Feb 1, 2021 21:43
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Thinking out loud, because I keep picking at FUAMX as my bond index fund choice, yet whenever I compare it against alternatives it comes out on top. Am I missing anything here? Sometimes FXNAX looks better with its higher yield (1.08 vs 0.69 30-day) and barely-lower expense ratio (0.025 vs 0.03), but looking back at large dips, FUAMX distinctly rises while FXNAX mostly sits flat. Ordinarily, they perform nearly identically, which reconfirms how treasuries remain a safe harbor in times of uncertainty. My bond allocation is for counterbalance, and FUAMX seems to perform that function well. Then there are higher-return bond funds like FAGIX, which has a much higher yield (2.61) accompanied by higher expense ratio (0.67), but its performance is strongly correlated to the market (comparing with FSKAX bears this out). If I want market returns I should just buy more of a total stock index. In either case, does the higher yield compensate for shortcomings? FWIW I'm still decades out from depending on dividends for passive income and I currently pursue a fairly aggressive allocation strategy (tapering toward bonds as I approach retirement, of course). Bonus: every time I research this or that fund variation, stocks bonds or otherwise, Fidelity will recommend a handful of funds I've never seen before. The ones marked high return, low expense always grab my attention, only to inevitably charge a comparatively high expense ratio (usually in the 0.7 range) and consistently underperform the S&P 500. Why even bother, Fidelity? (To fool customers and make more money) Space Fish fucked around with this message at 04:25 on Feb 4, 2021 |
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Feb 4, 2021 04:13
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Pennywise the Frown posted:
Admiral funds have a lower expense ratio in exchange for a minimum amount to invest (used to be $10,000, I think the bar's been lowered to $3,000 in most cases). Once you cross that minimum threshold you can make smaller contributions. Yes, go for the Admiral version whenever possible.
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Feb 5, 2021 20:56
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Sardonik posted:Is this always true though? VTI is a 0.03% expense ratio whereas VTSAX is 0.04%, or is this just a temporary situation as I see the expense ratio is assessed on what seems to be a yearly basis. https://www.tictoclife.com/vtsax-vs-vti/ VTSAX is a mutual fund (price updates and shares sell at end of day; more exclusive to brokerage; can set auto-purchasing and fractional shares) VTI is an Exchange-Traded Fund (price changes and shares sell instantly; open trading outside of Vanguard; cannot auto-purchase and not always available in fractional shares)
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Feb 5, 2021 22:30
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Wifi Toilet posted:If you're already in Fidelity, just use one of their zero expense funds. That chart at the bottom, got-drat. Didn't realize how consistently Fidelity's indexes beat Vanguard in expense ratios, often by a significant margin (for now...) The only commentary I've seen from Bogle about Fidelity's zero-expense indexes was something like "you can't get much lower than zero." Good job leading the industry, Vanguard?
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Feb 7, 2021 07:13
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So long as indexers have a far-off time horizon for retirement, yeah, they can most likely weather market corrections and crashes and ultimately come out ahead. How is that not low-risk? A question about bonds: if rising interest rates cut down bonds' payouts, and the interest rate is already near zero, and bonds are already paying pretty low... what would happen if rates started going up now? Would bond returns become 0.01% crumbs? And how would they bounce back?
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Feb 10, 2021 19:40
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Your state's department of revenue website likely lists tax websites that will file your federal + state for free if you earn below a given amount (and the amount will vary from service to service).
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Feb 17, 2021 02:33
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Click around NerdWallet and pick the benefits that fit your spending habits best. At the very least, get a cash-back rewards card like: Citi Double Cash - 2% cash back Fidelity Rewards - 2% cash back, need a Fidelity account to redeem Capital One Quicksilver - 1.5% cash back, no international (outside USA) transaction fee
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Feb 24, 2021 21:28
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There are several (too many!) slice-and-dice methods, and they all show great promise based on past results. Which one will show the greatest return in the future? That sounds like revolving sectors, whereas the three-fund portfolio's advantage is supposed to be in its ease and simplicity. At the same time I say that, I hypocritically have a small slice of my roth in domestic and international REIT indexes. Yes it's a weighting gamble, but hey, Burton Malkiel made an impression on me and I like the low correlation to the overall market, even if they can be volatile. There are compelling cases for equal weightings of all value cap sizes, but I'm also partial to Bogle's reasoning that market indexes weight by size, so if a smaller company does well, it will climb the weighting ladder and be reflected in the index accordingly (I use total market over S&P 500 for this reason, even if performance is nearly identical).
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Mar 1, 2021 22:14
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pokeyman posted:This Ben Felix video lays out why you shouldn't prefer stocks that pay dividends: https://youtu.be/f5j9v9dfinQ I need to see Average Joe On Money's dividend portfolio go up against Felix's claims. Joe is right about to drop a video about his "high quality dividend stocks" after comparing a dozen different combinations of indexes/ETFs. Joe seems to target a combination of dividend and long-term performance that I find compelling, I'd just like to know his criteria for selection.
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Mar 3, 2021 07:02
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I am not a smart investor but I concur with Koushiro.
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Mar 5, 2021 07:02
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jeeves posted:I’ve seen people on Reddit’s Rate My ETF portfolio threads post stuff like this: I'm SMH, all right. Just VTI (which isn't blue chips??) and chill.
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Mar 11, 2021 01:40
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Nathan Winklepeck is giving me plenty to chew on with his dividend ETF analysis: https://youtu.be/TPSw7On2gUo Any downsides to holding SCHD in a tax-advantaged account? I would of course set dividends to automatically reinvest. Edit: as a counterpoint, I'm not asking about chasing dividends or valuing the percentage payout for its own sake, just as a useful tool for passively increasing a stake in a set of screened companies. I understand the case against chasing dividends as explained here: https://www.optimizedportfolio.com/dividends/ Space Fish fucked around with this message at 07:23 on Mar 11, 2021 |
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Mar 11, 2021 07:16
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I was digging through VTI and VOO's holdings to make some comparisons for myself and noticed that each of the bottom 2,176 companies in VTI registers as less than 0.01% of the fund's holdings. That leaves 1,428 companies that each constitutes at least 0.01% of the fund's value in holdings. Starting at the 500th lowest company in VTI's pecking order, companies start out worth 0.03% of the fund's holdings. In VOO, the 500th lowest company is worth 0.01%. The bottom four (there are 509 holdings in it) each register as less than 0.01% of the fund's holdings. What of dividends? VOO currently costs $362.36 per share and pays a recent average quarterly dividend of $1.33/share. (averages based on past six payouts for a recent snapshot) VTI currently costs $207.40 per share and pays a quarterly dividend of $0.72/share. A price comparison shows VTI as having 57% VOO's price and 54% its dividend value, or dividend/price of VTI's 0.35% to VOO's 0.367% (today, in a fluctuating and irrational bull market), so it appears either is fine for tracking the US stock market while also, ideally, reinvesting the dividends of either to increase one's stake as the respective fund grows. Another comparison: VIG, a fairly popular dividend ETF running $144.65/share today, recent average dividend payout of $0.57/share. Price is 39.9% VOO's while dividend is 42.8%, so, fairly consistent. Compared to VTI, VIG is currently 69.7% VTI's price and 79% its dividend payout. Hmmm, VIG seems to have a slight dividend value advantage over both! In terms of sector differences, VTI compares as follows to VOO: Basic Materials -0.8% Consumer Discretionary +3.8% Consumer Staples -1.2% Energy +0.1% Financials +0.1% Health Care +0.2% Industrials +5.2% Real Estate +0.9% Technology -1.2% (vs VOO's "Information Technology") Telecommunications -6.4% (vs VOO's "Communication Services") Utilities +0.2% While each ETF historically performs nearly the same going back to 2011, there are blips from about 2016 onward where VOO ticks a little higher every so often. Going back even further to their respective indexes, the total market outperforms compared to the S&P 500 going back to 1974, though good luck finding any total market funds back then when Bogle had to push as hard and as long as he did to get a meager version of an S&P 500 fund off the ground. Even though VOO is 82% of VTI and slightly outperforms, I can't resist VTI's minor exposure to mid caps (12%) and small caps (6%). Thank you for indulging this useless spur-of-the-moment personal homework. Had to see the numbers for myself.
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Mar 13, 2021 05:06
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acidx posted:S&P 500 to drop 40% by Friday. Gotta give the new kids on the block a good sale to jump into the markets. Dumb question: is everyone upset/suspicious about bond yields rising because they went 100% stocks and assumed there'd be no downside from focusing so hard on equities?
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Mar 17, 2021 13:58
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Besides, even if you did luck out and invest your cash at the tail end of a crash, there'd be renewed daily warnings of the next crash as soon as things began evening out. Market and indicator charts look progressively crazier by the day, but maybe they'll average upward for another year or more before tripping. That's value you'd have lost - time in the market beats timing the market.
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Mar 21, 2021 04:22
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pmchem posted:If anyone has like a best practices method for finding good, fixed-fee, local fiduciaries I'd like to know it. https://www.napfa.org/
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Mar 23, 2021 14:35
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runawayturtles posted:My wife has a taxable account her parents set up for her around 15 years ago. They put in $4k, which was apparently split between two actively managed funds. The account has grown to around $11k by now. Long-term capital gains tax rate / Your income 0% / $0 to $40,000 15% / $40,001 to $441,450 20% / $441,451 or more Source
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Mar 23, 2021 21:00
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KYOON GRIFFEY JR posted:edit: note that poster above included information for single filers, not MFJ. MFJ is 80/496,6 for the bounds of the 15% bracket. I assumed MFJ since you mentioned MY WIFE I jumped the gun, my bad!
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Mar 24, 2021 17:22
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MJP posted:The expense ratio for this fund is 0.73 basis points (0.0073%). Shorty got low, low, low, low, low...
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Mar 25, 2021 18:45
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I can't escape the allure of small-cap value tilt, what are y'all using? AVUV seems to be the current darling, but I'm not opposed to VBR.
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Apr 1, 2021 06:07
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GhostofJohnMuir posted:it gets reposted often here, but the story of bob the unluckiest investor is pretty enlightening on this front Related and recent: https://youtu.be/MyqCUmGu3Z8
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Apr 18, 2021 21:42
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Kylaer posted:The Mammon Machine powered the Kingdom of Zeal And the Black Omen still hovers to this day!
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Apr 29, 2021 14:24
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Sundae posted:The context of the original statement was that Americans don't understand tax brackets / marginal tax rates. That's not a complicated topic, doesn't conceptually change with tax code iterations, and can be explained to someone in literally five minutes. (This makes it all the more ridiculous that we don't teach it. It's EASY.) Oh, Americans are taught to understand taxes in a bite-sized format, but that format is "taxation is theft" and "don't tread on me." Then the aforementioned deduction stretching begins as taxpayers convince themselves they're going to beat the SYSTEM... that THEY use to rob US!
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Apr 29, 2021 19:32
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EmmaDilemma posted:Is it incredibly insecure to just remember your passwords, instead of using a fancy password manager, and if you can't remember, utilize the site's lost password feature? I used to let password security slide until I received an expensive appliance from Amazon, charged to my account. The thief forgot to enter their own address! I changed my passwords, returned the appliance, canceled/replaced the card, and shifted everything to 2fa on the spot.
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May 6, 2021 05:39
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Fidelity's app recently updated with night mode on by default. Now it looks more like an addictive casino app and less like people's grandparents' (ewwwww!!) investing sites. Wheee, greater emphasis on green and red everywhere! Or mostly red, in my case...
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May 7, 2021 19:40
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Ramrod Hotshot posted:I will still have some cash to spend after fully funding my 401k. I've heard VTSAX and VTI talked about in the last few pages. They look very similar, what's the difference? VTI is an ETF that exists as an extension of VTSAX the mutual fund. Vanguard has a patent that allows VTI to exist as shares of VTSAX, though once the patent expires you can expect a lot of brokerages to pull that trick. What's weird about the arrangement, at least to me, is that VTI has a lower expense ratio (0.03% and no barriers for VTI across brokerages vs 0.04% and need to invest at least $3,000 to start in VTSAX, and there'll likely be a purchasing fee if you're not using Vanguard).
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May 10, 2021 04:14
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jokes posted:Also, the historical data we all lean on to justify passive index fund investments and poo poo happened during arguably more immediate existential crises. I mean, the same basic financial advice was correct during a global depression, the largest military conflict in the history of the world, a draft (US), looming nuclear warfare between superpowers, many many genocides, record-breaking natural disasters, multiple seemingly forever-wars, the largest act of foreign terrorism in the history of the US, blah blah blah. I've been reading up on the market crash of 1929 and financial crisis of 2007-2008, and the parallels are frustratingly alike. I need to find out more about the rules and regulations behind trading on margin. People use money they don't have to load up on stock that will, by the law of averages, go down sometimes, and the resulting domino effect is inevitable. Worse yet, in both instances a bunch of finger-pointing resulted about where the first domino was placed that started the chain reaction, when the brokerages and money managers had countless opportunities over a course of years to slow people's rolls and take a short-term hit to ensure long-term prosperity. But a manic mass has to get as rich as possible right now, leveraging every possible cent this very second, consequences be damned. Even Groucho Marx's losses stopped at his net worth, and he thought borrowing to invest was easy theft. I am venting to agree with you, jokes. Broad indexes, some fun money set aside for controlled gambling to reduce FOMO, all after having an emergency fund set in place.
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May 17, 2021 15:52
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Fama & French updated their factor research in 2020 to say they didn't know if the SCV cat was out of the bag or not. It will be a while before people acknowledge this update against the decades of prevailing performance and advice, especially if SCV continues to do well.Strong Sauce posted:so how "balanced" do we need to have our retirement funds? i read the posts from friday-ish or so where people are talking small cap, large cap, 500 index, etc... does that matter that much? The usual weighted US market balance is roughly 80% S&P 500, 20% mid and small cap. You can chuck everything into a total market index and do fine. Keep in mind that extended market funds were created to complement S&P 500 funds before total market funds were invented, so one-and-done is a tool of efficiency and convenience. Feel free to tilt more mid or small cap if the top large-cap holdings give you pause. Space Fish fucked around with this message at 14:29 on Jun 7, 2021 |
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Jun 7, 2021 14:18
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Grand Fromage posted:There will be another crash. The mitigating factor is you're investing in the long term. There have been lots of stock market crashes, but it always recovers and goes back above what it was before the crash. So if you're investing for 20+ years, the crashes don't really matter. Quality post, right here.
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Jun 14, 2021 02:22
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Strong Sauce posted:what's the diff between FSKAX and FZROX ? FSKAX has ~900 more holdings than FZROX, but considering they still have 2,500 holdings in common, their performance is drat near identical. They have the same allocations to large/mid/small cap (72/20/8, last I checked). FSKAX has a miniscule expense ratio that won't be felt until you're too rich to care; FZROX has no fee.
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Jun 16, 2021 04:51
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Fhqwhgads posted:What am I looking at for something like that with these three? 70/20/10 FXAIX/FXMAX/FTIHX? Pretty much. drat, what a wholesome allocation, I wish you great long-term returns!
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Jun 16, 2021 14:41
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Animal posted:Can I live in a Rolex watch? You can live in a Citizen Promaster. It even separates its massive face into time zones for easy navigation!
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Jun 21, 2021 20:27
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Among neat Roth options is M1 Finance. Their claim to fame is saveable "pies," or ratios for splitting money across several funds. Some investment sites/advisors will share the "pie" for a specific strategy, which an M1 user can designate as the strategy for this or that chunk of money in their account, including future deposits. The three-fund strategy is simple enough to set up, but automating future contributions is a neat feature. I don't use M1 personally, but I know people who do and I might have relied on M1 if they'd been around last time I changed brokerages. Space Fish fucked around with this message at 03:47 on Jul 15, 2021 |
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Jul 15, 2021 01:56
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Strong Sauce posted:isn't foreign tax credit to offset double taxation? so you're still getting taxed anyways right? Yes.
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Jul 15, 2021 20:24
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Average Joe On Investing makes some compelling cases for going after, not just dividends for their own sake, but quality dividend stocks. Involves a lot more attention and tweaking than dumping it all in SCHD and VYM, but vigilantly screened dividend stocks can lead to significantly greater long-term return than a three-fund portfolio. Worth mentioning that Average Joe is all for indexing as a long-term strategy, too, but he's an example of a dividend investor who rises above shallow investment YouTubers.
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Jul 17, 2021 22:04
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