Thankfully some Bogleheads don't blindly follow everything Bogle said. Are there any areas where you stray from his teachings? Let me know in the comments.
As you said, Bogle is and isn't wrong about ETFs. He would eventually state in interviews that ETFs in and of themselves were not bad, so long as investors could stick to a buy-and-hold strategy. Retail investor behavior PLUS marketing turned him off regarding the instant trading potential. Derivatives markets in particular have proven Bogle correct that ETFs would become another slot at the casino. Cooler heads have done well with them, though.
Bogle did more for the average investor than anyone in history and his contributions should never be forgotten. But we shouldn’t disregard new information because Bogle had a differing opinion something 20+ years ago.
A recent rational reminder episode discusses an improved historic multi-country dataset showing that domestic-only investing has(at least historically) a much higher chance of significant losses over long terms compared to international investing. To be fair, I don't think they accounted for taxes or fees, but it's another good reason to invest internationally.
I love index funds as much as other Bogleheads but it’s interesting how Jack Bogle’s tastes on US vs International still heavily influence a lot of other Bogleheads into very international-light portfolios. I believe on the Bogleheads forum, I see common allocations between 40% at most to sometimes 0% international allocation. Those are just really heavy underweights for often seemingly arbitrary preferences in my view when there is good evidence that international exposure provides good diversification. For full disclosure I have slight US tilt and some SCV factor exposure.
Not a fan of international. I'm pretty happy with just holding VTSAX. Even if a mix of US and international is optimal, I still prefer the simple way for wealth accumulation.
One of the authority biases of Bogleheads is avoiding SCV stocks. They say that SCV stocks are present enough in the total stock market. Indeed, SCV stocks comprise
True, and I tilt SCV myself, but that one isn't so cut and dry and the investor must be prepared for tracking error regret in doing so. SCV comprises about 3% of VTI IIRC.
#1. for the average investor, Bogle is mostly correct. ETF,s are more easily to move in and out of and from Bogle's view, staying in and nver selling has proven to be a winning stratagey. for #3, one only has to look at the past fourty years of international performance.
40 years? Int'l beat US for the decades 1980-1989 and 2000-2009, and Emerging beat the US for the 2 decade period 2000-2019. US dominance is basically a recent phenomenon after about 2009. More importantly, past performance - especially the recent past - does not predict future performance.
Great vid, but I'm not sure I agree with the corp bonds vs treasuries point. They both play an important role in portfolio and it is likely any backtest since the 80s where a government printed money to religiously its own debt is going to skew results.
Corporate bonds do not play an important role in a portfolio that already holds stocks. Granted, they're not going to make or break anything either. Time period is irrelevant. I delved into this in more detail in this video: ruclips.net/video/kusdFCwwxLw/видео.html Here's the blog post with references at the bottom if you don't want to take my word for it: www.optimizedportfolio.com/treasury-bonds-vs-corporate-bonds/
@@yoshortyb MBS tend to be more correlated with stocks than treasuries but less so than corporates. Not so clear cut on that one. But yes I'd still take pure treasuries over MBS.
Thankfully some Bogleheads don't blindly follow everything Bogle said. Are there any areas where you stray from his teachings? Let me know in the comments.
As you said, Bogle is and isn't wrong about ETFs. He would eventually state in interviews that ETFs in and of themselves were not bad, so long as investors could stick to a buy-and-hold strategy. Retail investor behavior PLUS marketing turned him off regarding the instant trading potential. Derivatives markets in particular have proven Bogle correct that ETFs would become another slot at the casino. Cooler heads have done well with them, though.
Good take. Thanks for the comment, Thomas!
Bogle did more for the average investor than anyone in history and his contributions should never be forgotten. But we shouldn’t disregard new information because Bogle had a differing opinion something 20+ years ago.
Indeed.
A recent rational reminder episode discusses an improved historic multi-country dataset showing that domestic-only investing has(at least historically) a much higher chance of significant losses over long terms compared to international investing. To be fair, I don't think they accounted for taxes or fees, but it's another good reason to invest internationally.
Great point! Thanks for sharing.
I love index funds as much as other Bogleheads but it’s interesting how Jack Bogle’s tastes on US vs International still heavily influence a lot of other Bogleheads into very international-light portfolios. I believe on the Bogleheads forum, I see common allocations between 40% at most to sometimes 0% international allocation. Those are just really heavy underweights for often seemingly arbitrary preferences in my view when there is good evidence that international exposure provides good diversification.
For full disclosure I have slight US tilt and some SCV factor exposure.
Indeed
Not a fan of international. I'm pretty happy with just holding VTSAX. Even if a mix of US and international is optimal, I still prefer the simple way for wealth accumulation.
Thanks for watching and sharing, Jeffrey. What's your reason for not being a fan of international? I'd argue VT/VTWAX is just as simple as VTI/VTSAX.
@@OptimizedPortfolio I share the same view as Buffet, Bogle, and JL Collins. 100% 🇺🇲. So far so good.
@@OptimizedPortfolio I'll probably end up using a target date fund for the wealth preservation part which has international in it.
@@MrJeffgonz Sounds like a plan :)
Great video, just wondering what’s you educational background
Thanks! Math; specifically statistics.
One of the authority biases of Bogleheads is avoiding SCV stocks. They say that SCV stocks are present enough in the total stock market. Indeed, SCV stocks comprise
True, and I tilt SCV myself, but that one isn't so cut and dry and the investor must be prepared for tracking error regret in doing so. SCV comprises about 3% of VTI IIRC.
#1. for the average investor, Bogle is mostly correct. ETF,s are more easily to move in and out of and from Bogle's view, staying in and nver selling has proven to be a winning stratagey. for #3, one only has to look at the past fourty years of international performance.
40 years? Int'l beat US for the decades 1980-1989 and 2000-2009, and Emerging beat the US for the 2 decade period 2000-2019. US dominance is basically a recent phenomenon after about 2009. More importantly, past performance - especially the recent past - does not predict future performance.
Great content as always. Thank you!
Thanks, Robert!
Great vid. I wish I discovered your content earlier.
Thanks, Peter!
Great video idea!
Thanks! :)
Excellent video
Thanks!
Great vid, but I'm not sure I agree with the corp bonds vs treasuries point. They both play an important role in portfolio and it is likely any backtest since the 80s where a government printed money to religiously its own debt is going to skew results.
Corporate bonds do not play an important role in a portfolio that already holds stocks. Granted, they're not going to make or break anything either. Time period is irrelevant. I delved into this in more detail in this video: ruclips.net/video/kusdFCwwxLw/видео.html
Here's the blog post with references at the bottom if you don't want to take my word for it: www.optimizedportfolio.com/treasury-bonds-vs-corporate-bonds/
@@OptimizedPortfolio Thanks for the response, do you think this applies to MBS as well? They are a huge part of the agg.
@@yoshortyb MBS tend to be more correlated with stocks than treasuries but less so than corporates. Not so clear cut on that one. But yes I'd still take pure treasuries over MBS.
Warren Buffet is The Goat
🙌