How to Beat the Market Like a Boglehead
HTML-код
- Опубликовано: 4 мар 2024
- The three-stock portfolio has been a hot topic on our premium Discord server lately, understandably so. This passive portfolio was the work of John Bogle, founder and ex-CEO of Vanguard, known for their low-cost index funds. Bogle's advice is so sound that it's resonated with a community of 120,000 people who call themselves "Bogleheads".
The Bogleheads are a group of like-minded individuals with a mission to make sure investors get their fair share of the market returns. They emphasize investing early and often, living below your means, and lowering costs whenever possible. Are the Bogleheads a cult? Are they on to something? We'll explore that in today's video.
RESEARCH PIECES USED IN THIS VIDEO:
1. Judging the Two Biggest Dividend ETFs
• Judging the Two Bigges...
2. The Impact of Taxes on Dividends and Gains
www.nanalyze.com/2023/11/taxe...
3. Quantigence - A Dividend Growth Investing Strategy
www.nanalyze.com/dividend-gro...
CHAPTERS:
00:48 About Bogle
02:14 Stock cults
03:21 Cultural cults
03:50 The Bogleheads
05:25 The 3-fund portfolio
07:42 Principles of Bogle
11:18 The "quilt"
14:23 Parting thoughts
ABOUT US:
This video is brought to you by Nanalyze, a media and research firm founded by finance professionals with decades of experience. We share insights about #DisruptiveTechnology #stocks and #DividendGrowth stocks in a language that is future-proof and easy to understand.
Read all the Nanalyze Premium articles you'd like for free! Sign up for a 30-day trial of our monthly subscription with no strings attached: www.nanalyze.com/subscription...
DISCLAIMER: Our content is intended to be used and must be used for informational purposes only. It is very important to do your own analysis before making any investment based on your own personal circumstances. You should take independent financial advice from a professional in connection with, along with independently researching and verifying, any information contained within our RUclips videos or on our website, whether for the purpose of making an investment or otherwise.
#etfs
#vanguard
#johnbogle
#bogleheads
#bogle
Welcome, Bogleheads! If you're interested in joining our global community of sensible investors, sign up to our free newsletter: bit.ly/NanalyzeWeeklyYT
I enjoy this channel. Keeps me grounded.
Thank you for the kind words! That's what we're here for!
Great video and content. Subscribed.
Thank you for the feedback and sub!
Is there any advantage to having three funds if instead you can have a weighted total world ETF (which has most of the stocks as US stocks) ... For example: FTSE All-World UCITS ETF - (USD) Accumulating (VWRP)
That is a great question. We recently covered the idea of a single ETF covering the world's stocks here (ruclips.net/video/D45ioke9VCU/видео.html). Maybe open this one up to the class. Can anyone think of why you'd want two ETFs here? Sure, you can balance them easier, but why not let the experts do that with an MSCI ACWI IMI sort of ETF?
I would be curious how many of the broad market ETFs, over the past 30 years, when adjusted for fees, inflation and taxes bring actual net positive gains.
Good point here. Most broad market ETFs today have very low expense ratios (and very low tracking errors) so they're coming pretty close to providing market performance.
I love Vanguard and that's where I started my personal investing journey, great video. Speaking of cannabis and thematic shematics, could you cover the POTX delisting?
"Thematic schematics" :) So Global X (a pretty decent ETF provider from what we've seen) did a regular review of underperforming ETFs and decided to close a few. POTX was one of them. This is why it's very important for ETFs to amass AUM or they can't survive. Investors just sell back their holdings to Global X before the ETF goes away and move on with their lives.
Also, this says less about the viability of the investment theme and more about the ETFs inability to attract assets for whatever reason. People always ask us when we're debuting an ETF and the answer is "hopefully in the future but we're going to do it right because it's very tough."
@@Nanalyze would you consider doing a video on delisted ETFs and what to watch out for before they are delisted? The reverse stock split was the first warning for POTX. At what point should a thematic ETF be sold based on AUM?
@@Nanalyze following you through the process of debuting a ETF would be fascinating. Love the honest content you provide and thoughtful approach in everything you do.
@@william.stafford Note that investors do not lose out when an ETF is delisted. You simply sell your shares and move on. If you don't, your brokerage firm sells them and you get the cash, or they provide you advance notice of the delisting. That's my experience. Others can chime in if they've had different experiences. Joe P.
Interesting👌
Glad you enjoyed! Didn't really know much about these folks before this video but really impressed with the work they do. Joe P.
I don't yet understand how does margin of safety differ from timing the market. If I don't want to buy a company yet because of its high price, am I timing the market? Isn't the whole point to buy stocks at good prices so wouldn't that be "timing it". I am quite new to investing so I would want to learn whats the difference and when to not time the market
Good question. This is where dollar cost averaging comes into play. Nobody can predict where a stock will be at any given time so spread out your buys. You can combine that with some valuation measure. For example, we use a "simple valuation ratio" for tech stocks to make sure we don't overpay. When it comes to quality stocks (dividend champions, for example) you'll find they trade more consistently over time and you can get away with just buying the portfolio every month (ETFs as well).
You’re not timing the market because you’re not buying the market at that point, you’re buying a company. The market could be overvalued yet a company you like is at the perfect price, or vice versa the market is undervalued yet a company you like is still overvalued. People who are trying to time the market assume all the companies they want to buy move at the same wavelength as the entire market, and that’s not true. If you’re sitting in cash waiting for some economic apocalypse to happen so you can “buy the dip” that’s trying to time the market, and that is what people fail miserably at.
In my view, the difference is in buying something at a price that's right for you, vs buying something at the lowest possible price. For example, say you decide that Microsoft is a great buy at a PE of 20, and the stock drops to that price. If, instead of buying at that price (based on what you think Microsoft is worth), you wait because "the market might make the stock go lower", then you are timing the market.
You can apply this to anything you spend money on really. If you see a great deal at the grocery store for potatoes (well below your potato budget for the week), do you buy the potatoes now (based on the value these potatoes have to you), or do you wait because you speculate that the price might drop further (timing the market)?
Saint Jack!
Pray for our us...
My investment mostly VTI
Mostly betting on America
🙏
Glad you found this video useful!
boglehead types usually attack dividend strategies some of them are rather extreme.
That's very interesting. Moving from debating to attacking is what the video warned about. If one truly understands what dividend growth strategies accomplish then they would understand the appeal. Joe P.
Great strategies for people _investors_ who are too lazy, don't have time, or for whatever reason have no interest in learning to *trade* stock. Although, to be completely fair I should concede the fact that only a small percentage of people can *ever* become consistently profitable in the stock trading game because, in the final equation, it is more of an art than a craft.
When only the smallest fraction of "traders" make and keep money over the long term, sounds like it's more intelligence than laziness exhibited by Bogleheads.
Hmmm, I noticed your Asia Funds allocation is pretty small. Really, diversification seems to be an art. It is difficult to diversify properly when the term itself is unclear. Country GDP based diversification might be one way, but that doesn't account for communist regime (funny numbers), for example. I'm not doubting your Asia allocation, and I find your overall allocation very interesting (nice touch with a small % wine, art, btc, gold). It's just that I am surprised, Boggleheads (and many others) seem to happily go overweight on US stocks. It's odd to me, China seems pretty advanced, in some areas. Although they have many ongoing problems right now (demographics, economy, corruption), it just seems odd that from what I've seen, investors tend to keep allocation to a minimum.
How can investors justify their overweight in a specific region? 🤔 Which metric should be used for diversification? These questions seem really hard and have no guaranteed right answer, I think. Maybe correlation matters too in this...
You're asking some good questions here. We've touched on this before, but the "best" way to diversify globally may be to take a look at the MSCI ACWI (All Country World Index) and allocate according to that. It's an inexact science, as you alluded to. We always appreciate your comments! -Wyatt C.
In addition some of the big US companies have significant revenues from overseas. Even Meta gets Chinese advertising revenue even though the platform is banned in China. Being overweight US is in my opinion healthy as other markets, emerging or otherwise, are correlated to the US and from my reading do not offer diversification benefits from negative correlation or outperformance.
@stephengalea9447 Good point on multinationals which is why we have an "international sales" factor in our dividend growth strategy.
Thanks very much for the answer. I explored the msci acwi deeper and I understand things better now.
While I've built a successful stock portfolio, beating the index, it comes at a cost. The constant analysis and news monitoring are stressful and time-consuming. After seeing the success of the Boglehead approach for my children portfolio, I'm making the switch to a more passive style for myself, prioritizing reduced stress over potentially higher returns. ETFs are the way
Always great to hear from you Borat. Interesting thoughts you raise here. The older we get, the less stress we want in our lives, but the more time we have on our hands to manage our investments. ETFs are a no-brainer way to accumulate wealth and it's surprising how many "experts" get paid to tell people otherwise.
Please analyze a Schwab 3-fund portfolio. Newer investors may not be able to buy VOO or some of the other higher cost funds. I find very little info on Schwab funds, besides SCHD. I opened an account with the help of a Schwab “advisor” and it made very little. I kept one fund from the original portfolio and now I’m seeing gains. Is the slide around 7:20 “Keeping it in the family” the foundation Nanalyze recommends for each brokerage?