AVES
Avantis® Emerging Markets Value ETF
Mentions (24Hr)
0.00% Today
Reddit Posts
Would AVLV theoretically be any more profitable than a passively managed fund like VOO?
What stocks or funds can I add to optimize and strengthen my portfolio?
FT: "Emerging markets hit by worst sell-off in decades" -- Time to Diversify Internationally?
FT: "Emerging markets hit by worst sell-off in decades" -- Time to Diversify?
Mentions
The most important principle in investing (in my opinion) is diversification. You want to buy a globally diversified portfolio of stocks, and the ETF that achieves this is VT (Vanguard Total World Stock Market Index Fund). If you invest $100 into VT, your money effectively goes to all the publicly traded companies in the world according to their market capitalization. Nvidia Corporation is 4.26% of the world's stock market capitalization, so $4.26 of your money would be invested in Nvidia Corporation. Similarly, Rolls-Royce Holdings is 0.13% of the world's stock market capitalization so $0.13 would be invested in Rolls-Royce Holdings. You get the idea. The point is that you are not betting on any individual country, sector etc. by investing in VT. The safe option to start off with is to buy VT, and keep investing whenever you can. Now, there are ways of "beating the market". Financial science suggests that there is no publicly known way to do so without taking on more risk (if there was a less risky way to do so that was publicly known, wouldn't everyone do it and then it wouldn't work anymore?). For example, factor exposure (which was introduced by Eugene Fama and Kenneth French in their Nobel Prize winning paper) suggests that, for example, small cap value stocks are expected to outperform the market over long time horizons because they are inherently riskier. The historical data suggests this is the case. You could tilt toward small cap value with ETFs such as AVUV (Avantis US Small Cap Value) and AVDV (Avantis International Small Cap Value). Emerging Markets is another sector of the market that is inherently riskier and has historically delivered higher long-term returns than the US Stock Market, for example. You could tilt a bit to Emerging Markets with AVEM (Avantis Emerging Markets), and especially AVES (Avantis Emerging Markets Value) and AVEE (Avantis Emerging Markets Small Cap). Avantis' methodology is based on the Fama-French model and their research and this has also historically outperformed the market over long time horizons. My suggestion is to buy VT, and if you want some tilts you could buy some AVUV, AVDV, AVEM, AVES, AVEE (of the latter three, AVEM is the best if you want to go with one). I would keep at least 75% of your investment in VT (maybe more) and tilt according to your preference after you have done some research and asked lots of questions. The other method to outperform the market is buying individual shares. Unfortunately, this is really risky and mostly does not pay off unless you are willing to do a lot of research and buy and hold for long periods of time. I couldn't tell you what individual shares will take off in the next 10 years with any sort of guarantee. On the other hand, there is a third method to beat the market, by buying leveraged ETFs. It turns out that leveraged ETFs, provided the leverage isn't too high, do outperform the market over long time horizons, but I wouldn't recommend getting into them until you have accumulated more knowledge and started with the core base of VT. I wish you the best in your investment journey! You absolutely can't go wrong, over long time horizons, with VT. Remember that investments in stocks (including VT) is for the long haul, these do not function as savings accounts, because they can be volatile in the short term and have drawdowns lasting several years. You should look at the historical performance over decades, however, to see that if you stick with them, and provided capitalism continues to thrive on Earth (which in my mind is a safe bet, unless something really disastrous happens), then VT will give you strong growth over a long time horizon. I would estimate it will beat inflation by around 5% on average per year based on historical performance, and that compounding effect can really snowball over several decades. A cool stat is that $5 a day invested for 45 years at 10% annual return, would be around 1.4 million dollars, where 80k of that is your own money, and nearly 1.4 million of that is interest earned from investments. If you contribute more early, then of course, you can see faster results. I wish you all the best in your investment journey! 😊
Hey man, I saw you a lot around here and your advice is pretty easy for a beginner like me to understand. Mind if I ask you a question? Right now, I’m in a similar position. I only hold SPYM but want to add more international diversification. If I plan to hold long term, what do you think of IDMO + AVDV. I feel like this cover both ends of developing markets. But I’m also willing to switch out IDMO for AVDE, IDEV or FENI. I also plan to add some forms of EM like AVEM, AVES or FRDM. Personally, what do you think about these funds? I plan to do 20% for DM and 10% for EM.
Note: AVEEX has a 5M min investment, but AVEM is a close equivalent Also, DEMGX tilts towards small caps so AVES is the better comparison In short: 1. if you want SMB & HML, go DEMGX 2. if you just want HML, go AVES 3. if you want the most minor tilt, go AVEM
Bonds are just as risky as stocks with low return potential. The ten year return of BND is around 1.5% per year, not even keeping up with inflation. They are okay for diversification and peace of mind but I think 70% bonds is reckless. If you are scared of another lost decade I highly recommend investing 70% into funds negatively correlated with big tech. AVUV, AVDV, AVMV, AVIV, AVES, 0r just AVGV to get all of them. I’d recommend 30% AVUQ, 70% AVGV. But it sounds like you need a financial adviser who can teach you emotional management. Behavioral risk is the biggest risk of investing.
Yeah its been an absolute beast; my smaller allocation to AVES has been doing really well this year too.
AVUV AVDV and AVES bc I'm young and willing to take on more risk.
Some great options: VXUS - basically the whole market outside the US VEA - the whole developed markets (Europe and Japan/Australia mostly) VWO - the whole emerging markets VYMI and VIGI - international high-dividend and dividend growth ETFs: these are large-cap funds tilted slightly towards value, profitability, and lower volatility VT - the ultimate “I just want average returns” stock, it holds essentially all investable stocks on earth weighted by market cap (size), so you could just sell whatever you have, buy this, and call it a day. Some higher expense ratio options you might want for specific purposes: AVDV and AVES - these are well regarded small-cap value funds for developed and emerging markets FEZ and AIA - these are ETFs of the largest 50 companies in Europe and Asia. If your investing thesis is “I like companies that have already cornered the market because they probably have competitive advantages”, this might be for you
Huawei is privately owned. There's a higher risk premium to be expected for investing in emerging markets, and particularly for the Chinese market to US and Western investors given geopolitical tensions. But at some point the valuation becomes enticing. Note that approximately 50% of the responses in any thread related to China suggest they would not invest in China at all, suggesting that they are ideologically opposed to it (i.e. there is no valuation cheap enough to make it worth their while). Personally, I don't own Chinese stocks or ADRs, nor do I own Chinese-specific ETFs (paying 50-75 bps is ridiculous, why pay a much higher expense ratio for single country risk when you could diversify while get it much cheaper?). But I'm more than happy to get that exposure by paying 7 bps for passively managed emerging market ETFs like VWO or 33-36 bps for factor-tilted AVEM or AVES (where value premia have outperformed and which return some of the expense ratio in the form of higher foreign tax credits anyway). Likewise their counterparts in developed countries.
Same here but threw in AVES for some emerging markets exposure as well 35 VOO 35 AVUV 15 VXUS 7.5 AVDV 7.5 AVES This is for taxable brokerage. 70/30 us / international with heavy SCV tilt. My 401ks are standard target date funds so wanted more risk exposure with this one
Here are the performances of VOO (S&P 500), VTI (total US stock market), VXUS (total international stock market), and a DFIV/AVDV/AVES portfolio (international value tilted portfolio, as the value factor has performed much better in international equities). I chose two time frames, since [Inauguration Day](https://testfol.io/?s=aUi41pgL4Sa) and since the [April 8 bottom](https://testfol.io/?s=c6zwkit3ZtK) (which would assume you had perfect insider info): |Returns as of 6/26/25|VOO|VTI|VXUS|Intl Value| |:-|:-|:-|:-|:-| |Since 1/20/25|2.10%|1.29%|14.57%|18.12%| |Since 4/8/25|23.52%|23.87%|24.47%|26.88%| Even if you had insider info telling you to buy on 4/8/25 right before the stock market recovered, you would have still done better to rotate to international.
International stocks have trounced US stocks and actually recovered even more quickly. From a comment I made on r/ValueInvesting , so this includes a value-tilted portfolio. Here are the performances of VOO (S&P 500), VTI (total US stock market), VXUS (total international stock market), and a DFIV/AVDV/AVES portfolio (international value tilted portfolio, as the value factor has performed much better in international equities). I chose two time frames, since [Inauguration Day](https://testfol.io/?s=aUi41pgL4Sa) and since the [April 8 bottom](https://testfol.io/?s=c6zwkit3ZtK) (which would assume you had perfect insider info): |Returns as of 6/25/25|VOO|VTI|VXUS|Intl Value| |:-|:-|:-|:-|:-| |Since 1/20/25|1.30%|0.43%|13.45%|16.75%| |Since 4/8/25|22.55%|22.81%|23.25%|25.40%| That's right, even if you had insider info telling you to buy on 4/8/25 right before the stock market recovered, you would have still done better to be in international.
Yeah, the tilts are intentional. SPLG and VEA/VWO give broad global exposure. QQQM is a growth tilt I believe in long-term. AVUV, AVDV, and AVES add small/value exposure in the U.S., international, and emerging markets. Areas with strong evidence for long-term outperformance. Might look complex, but the goal is to diversify globally and tilt toward factors that historically add return.
Well, I can tell you what I use. But I don't think you actually _do_ care about that - you want to know what _you_ should use. And since we are different people with different situations, it would be intellectually lazy of me to just jump to the end, and not helpful (and being helpful is why I'm here). If you insist though: portfolio: - 85: # equity - 60: # US - 85: SCHB # broad - 15: AVUV # small cap value tilt - 40: # international - 75: # developed ex-US - 85: SCHF # broad - 15: AVDV # small cap value tilt - 25: # emerging - 85: SCHE # broad - 15: AVES # value tilt - 15: # bonds - 100: SCHQ # long-term treasuries
Its as simple as purchasing ex-US etfs like VXUS or VEA or VEU or AVDV or AVES, etc
If you’ve already got VOO/QQQ you’re skewed to large cap growth. That’s fine but you should mix in some small cap value. If you want to go international too, that’s fine. So maybe AVDV and AVES. Rebalance with the large caps once a year or so.
40% AVUV; 40% AVDV; 10% AVES; 10% VNQ YTD performance: something like +.95%
Is there an “optimal” strategy in terms of splitting which ETFs are in a taxable brokerage vs Roth IRA? I’m aware that for stuff like bond ETFs and REITs the Roth IRA is preferred, so I was wondering if there are other similar “strategies”? If so, what’s the play with my (27m) current portfolio: Brokerage: VOO 45% AVMV 15% AVUV 15% VXUS 10% AVDV 10% AVES 5% Roth IRA: SPLG 40% SCHG 10% AVMV 15% AVUV 15% AVNM 20%
I (27m) just started investing end of January, thanks to my supervisor suggesting not to start in my late 30’s like him (thanks man). Since I’m trying to go the long-term investment route, my portfolio will be all/mostly ETFs. (I did buy 5 shares in the Nvidia dip when it was like $117) From my “quick” research this is my current portfolio in my taxable brokerage: Vanguard S&P 500 ETF (VOO) - 55% Avantis US SCV ETF (AVUV) - 20% Vanguard Total Int’l Stock ETF (VXUS)- 10% Avantis Int’l SCV ETF (AVDV) - 10% Avantis EM Value ETF (AVES) - 5% I’ve been on the fence about adding either a large-cap growth ETF or a tech ETF. The former makes more sense to me to have more ✨diversity✨ and Schwab US Large-Cap Growth ETF (SCHG) is what I’d choose. But after doing some research into the value vs. growth debate, I’ve admittedly been hit by paralysis by analysis and I’ve come to you all to break the tie in my head. Should I invest in Large Cap Growth/SCHG? If so, what percentage of my portfolio should it take? Or should I go into a more large cap value tilt? If so, what ETFs do you recommend and what percentage should that be? Or should I stop overthinking and stick with my original portfolio since we don’t know the future? (Probably) Either way, how does the portfolio look? P.S. My Roth IRA is similar but with SPLG (VOO equivalent) and replaced all my ex-US with Avantis All Int’l Markets Equity ETF (AVNM). I did also invest 15% of my portfolio into SCHG, since I can sell within the account tax-free if I have regrets. P.S.S. Does anyone else like to compare their daily performance with the S&P 500? Like in a fun “I hope I’m beating my gym rival (who doesn’t even know me) today” way.
Ahh… a case for AVDV and AVES! Hehehe. 10% each and call it a day for international diversification?
Consider this mix: 1. S&P 500: Use an index fund or ETF for broad market exposure. 2.Small-Cap Value: Check out AVUV (Avantis U.S. Small Cap Value ETF) and AVDV (Avantis International Small Cap Value ETF) for potential high returns. 3. Emerging Markets: Go with AVES or FRDM for growth in developing economies. 4. Managed Futures: Add a sprinkle of DBMF or KMLM to hedge against volatility. This combo balances growth and risk across diverse asset classes. Happy investing!
Surprised to see these three bullets coexisting. To add some context here: * The argument for tilting toward small-cap value is that historically, over the very long-term, small cap stocks and value stocks (those trading at low valuations according to things like P/E, P/B, P/S, etc) tend to outperform large cap stocks and growth stocks respectively, and the combination of those two factors performs best of all. This outperformance has *not* happened in recent history (10+ years now) and there are those who think the small-cap / value premium doesn't exist anymore for a variety of reasons (an economy ever more dependent on high-growth tech companies, broader market participation and better data meaning hidden gems are harder to find, globalization and deregulation leading to oligopolies, etc). Others (myself included) think the pendulum will swing back as it always does, and small-cap value will outperform again in the long-term. I own some AVUV. * The argument for tilting toward emerging markets is two-fold: they too historically showed superior returns (although the data showing this is not as robust as for small-cap value stocks and, returns in the last decade have been terrible), and they also offer diversification in that they tend not to move in lockstep with developed markets. Here too I'm betting on a pendulum swing and do own some AVES and AVEE. * The argument for growth funds is that they target companies that are fast growing. Note that this does not exist on the same axis as the other bullets. You buy small-cap value ETFs and emerging markets value ETFs because you think the *stocks* contained in those funds will outperform the market. One buys growth ETFs because they think the *companies* will grow. One set of strategies is looking at what gives the investor a better return. The other is looking for the best companies and just hoping/assuming that a good return for the investor will follow. This has been a fantastic strategy for the last 15 years, as large cap American tech/growth firms have outperformed every other asset class. It's been a bad strategy for most of history previously because, by ignoring stock valuation entirely, investors end up buying into overvalued stocks that don't do well even if the underlying company does. I don't own any growth funds and don't intend to buy any. Again, I'm expecting a pendulum swing, and even if that doesn't come, I already own *plenty* of growth stocks through broad-based index funds which are already dominated by big growth companies. I agree with allocating more toward VXUS (or just buying VT instead of trying to balance the allocation yourself). American stocks have rarely if ever been more expensive relative to international counterparts, and I've never found the arguments for a strong home-country bias to be convincing.
I would forgo the moonshot in place of another ETF with exposure to something like * small-value (AVUV, IJS, VBR) * emerging market value (AVES, EVLU) * growth (QQQ, VGT, VUG) (tech isn’t really a proxy for growth but these are low cost index funds that include a lot of growth companies). I would also recommend higher allocations to VXUS due to lower relative valuations.
5 year horizon till retirement but also a long retirement, so lets take a long term view. You should buy the whole US market at least, SCHB or VTI or whatever. Its recommended to hold 20-30% international equities. Im not saying VXUS since its not my favorite. I prefer VEU (intl large and mid caps) + AVDV and AVES/DGS, some dude a few days ago likes LVHI for its lower vol large cap value approach. Whatever you choose, *long term*, international diversification makes the portfolio more robust, hedges country and currency idiosyncracies, and is one of the only free lunches in investing. 10-30% of your portfolio should be long treasury bonds. This will hedge your fear of a market correction or recession. When stocks crash fast, flight to safety assets like long treasury bonds spike up. Historically this method of holding 10-30% long T bonds like ZROZ along with equities like VTI or VT outperforms 100% equities by a lot, with far smaller drawdowns.
AVES has a higher dividend yield than DGS (3.64% vs 3.47%). Dividend payment and exposure to factor tilts is much more deeply linked than in the USA. For example, AVUV gives you very deep factor tilts in US small caps but only has a 1.65% dividend yield (share buybacks are much more prevalent). While unqualified dividends are unfortunate, due to the unknowability of future expected returns in different regions/markets/caps/factors, its best practice is likely to hold your diversified portfolio in all places.
DGS or AVES. Keep DGS only in an IRA though due to its dividends
Here’s a few good ones… - VEA international developed total market - VWO emerging markets total market - AVDV international developed SCV - DGS/AVES emerging markets SCV - VXUS total international markets
More aggressive would be buying small value (AVUV, AVDV, AVES), not mega growth stocks.
If you want a fund to do this all for you, consider AVGV. Great compliment to VOO. It’s global 60/40 US/ex and all value. AVGE is a less tilted one, 70% US, and could be your entire portfolio. Or add small value directly with AVUV (US), AVDV (DM), and AVES (EM).
Stick to your funds. Maybe tilt to small value with AVUV, AVDV, AVES. Defense or growth? Nah.
Foreign stocks, small value, and especially foreign small value is ridiculously cheap. Priced at recession lows. If the worst doesn’t come, we could be looking at another 2000-2007 situation (20% CAGR) for those stocks. AVUV, QVAL, AVDV, IVAL, AVES.
You really like paying taxes I see. AVUV for US, AVDV/AVES or just AVNV for ex.
You want systematic exposure to it. AVUV for US. AVDV/AVES for international.
AVUV, AVDV, AVES. Or just AVGV for global value all in one.
Someone that is a child can very easily buy AVUV, AVDV, and AVES. Or just buy AVGV which invests in global large and small value stocks. Or if you want a bit less tracking error, just invest in AVGE which has a bit more US (70% vs. 60%) and is a more modest tilt. None of this is difficult to implement, the hard part is dealing with tracking error. But to say that investing in small-value as a young person with a long horizon is a "terrible" idea is just flat wrong, but I get it, you just learned what the term means. But for someone with a truly long horizon, it is your best chance at outperforming.
I have 6 that have a value and small cap weight overall, with world market cap allocations based on US, International, and Emerging Markets. Historically weighting towards small caps and value provide the best return, whether that holds up is anyone’s guess… anyway these are my 6 that I think are tilted as aggressively as possible and give me the best change for the highest risk adjusted return without going overboard and doing something wild like 100% small caps. This is 65/35 us to international weighted, and 8% is emerging value. Small cap to med/large cap is around 1:1. AVUV-32.5% RPV-32% AVDV-14% DFIV-13.5% DGS-4-% AVES-4% Edit: There are no bonds here since you are in your 20s. Personally I am 100% stocks because I have diamond hands and don’t sell and don’t get emotional no matter how bad things get…I also have a pension when I retire which replaces the need for bonds for me
I have 6 that have a value and small cap weight overall, with world market cap allocations based on US, International, and Emerging Markets. Historically weighting towards small caps and value provide the best return, whether that holds up is anyone’s guess… anyway these are my 6 that I think are tilted as aggressively as possible and give me the best change for the highest risk adjusted return without going overboard and doing something wild like 100% small caps. This is 65/35 us to international weighted, and 8% is emerging value. Small cap to med/large cap is around 1:1. AVUV-32.5% RPV-32% AVDV-14% DFIV-13.5% DGS-4-% AVES-4%
Small-value. AVUV, AVDV, AVES. Or just buy AVGV and get global value exposure tax-efficiently (holds those funds plus some large-value ones). Will be true diversification to VTI/VOO which are dominated by mega-cap growth. Want even more diversification but still want your S&P500 exposure? For every $1 into RSST you get $1 of S&P500 plus $1 of a managed-futures replication overlay, which historically was uncorrelated to equities but had a \~3% excess return. Not quite as tax-efficient but stellar in an IRA.
AVES, Avantis emerging markets value fund
How are you evaluating the 5 year prospect of ex-US returns? This makes no sense at all. If you really must be 100% US, at-least add some small-value (AVUV) to further diversify (and boost expected returns). Similarly if you can only stomach a small amount of ex-US, put it into some factor funds to diversify further (AVNV would include AVIV, AVDV, and AVES all in one fund, giving you global ex-US exposure to value/size/profitability factors). 100% S&P500 is a bit silly frankly, but even more silly is changing how much ex-US you have every 5 years based on feelings... if you were using any form of fundamental analysis it would suggest ex-US has higher expected returns over the next 5 years (see Vanguard and every other major brokers market predictions).
AVUV (US), AVDV (dev ex-US), AVES (EM value, smaller cap but not actually small)
Lol, then that's just the alphabet! Exposure helps you remember, but ideally you won't need to care much later once you've picked your allocation for the long haul buy and hold. Personally, I use an S&P index fund, AVUV, AVDV, AVES. Yeah, I left out international market cap weight.
I use a international fund that has a value tilt to it. AVNV (fund of funds) it holds: 46% AVIV (International Large Cap w Value tilt) 30% AVES (Emerging Market w Value tilt) 23% AVDV (International Small Cap w Value tilt)
Here we are basically talking about Dimensional Fund Advisors and Avantis fund advisors. The make the best value /size/profitability factor tilt funds. Classics involve AVUV/DFSV, AVES, DFIV, AVDV, AVGV, AVMV, AVLV, AVNV, etc
Small-value is what you want to hold given your second to last paragraph. AVUV, AVDV, AVES. Recency bias is only reason to hold Q’s. And not a good reason ever.
No, for a mixture of reasons, somewhat personal / gut based too: - I don't like their heavy tilts to China/Taiwan - I think AVDV adds sufficient geographic diversification to allay my fears of single country risk in the SCV factor. Margin gain of diversification from AVUV --> AVUV + AVDV much larger than from AVUV + AVDV to AVUV + AVDV + AVES even if the latter feels the most logical application of all this factor tilting resarch. - I don't think we have much good empirical data on factor tilts in emerging markets, at least I don't trust it too much. - SCV is already increasing my risk, adding even more risk due to bad corporate governance, shady accounting, regime instability, geopolitical threats doesn't seem worth it.
DFSVX is an equity fund, no managed-futures there. This is live fund data, expenses are included. Today you can get even cheaper and more tax efficient exposure with many well designed ETFs (AVUV, AVDV, AVES). We are talking longterm (10y) rolling return averages that are 3%+ higher. That’s huge.
I was thinking like 60% VTI, 10% AVUV, 20% VXUS, 5% AVDV, 5% AVES
I hold AVUV/QVAL for US, AVDV/IVAL for developed exUS, and AVES for EM.
Emerging markets (value) is a better option (aprox +16% YTD and 25%1Y). 29% is China. Tickers Europe 5MVL. US AVES
Intra-day? Would be surprised. I use the much more liquid underlying AVDV and AVES.
Small growth is the lowest performing of all the 9 size/style boxes. Buying small value (some great funds are AVUV for US, AVDV DM, AVES EM) would be a worthy consideration for more risk/return. Growth has to do with the business fundamental growth, not equity prices.
And by bet I literally just have a position in AVES
I agree the obvious missing piece here is ex-US equities. Since you are open to a value tilt (AVUV), and I presume you won't be willing to hold a meaningful amount of ex-US stocks given you are 100% US at the moment, perhaps add 20% into AVNV, an ETF-of-ETFs from Avantis that includes AVIV, AVDV, and AVES, giving you coverage across all ex-US regions with a nice value/size tilt? A 60/20/20 VOO (I would use VTI but not a big difference), AVUV, AVNV portfolio is a solid setup much better than what you often see here. VGT/VUG is just recency-bias, no real reason to expect outperformance there in my humble opinion. If open to alternatives you could also replace some of your VOO with RSST. For every $1 into RSST you get $1 of S&P500 exposure plus $1 of a managed-futures trend replication system, basically a levered long/short portfolio of equities, bonds, currencies, and commodities. Historically this has added 2-3% of excess return while reduce drawdowns and volatility since managed-futures has a \~0 correlation to equities (and often negative during crises). But at a minimum, I would add some international value...
SCHD has very little tracking error (diversification) relative to S&P500. AVUV/AVDV/AVES would be night and day difference. I’m not sure why SCHD (or most of these funds you hold) are the Reddit golden standard, but it’s not a well diversified or constructed portfolio at all (VOO, SCHD, QQQ types), it’s recency bias.
Some small value, US or foreign. AVUV, AVDV, AVES.
Remindme! 20 years “Boglehead cultist who claimed he’d see 30% gains from ex-US in a decade actually needs 20 years instead. The clown is investing in AVDV, AVES, and IVAL and IMOM”
AVDV, AVES, and IVAL are my ex-US funds. See you in 20 years. I also use IMOM for foreign momentum.
Was your 401k a Roth or pre-tax/traditional like most 401ks by default? If the latter, be careful as moving to Roth is a taxable event. May make sense in your tax-bracket, but just pointing that out. I would focus on small-value personally. AVUV, AVDV, and AVES would give you global exposure. Want to make life simpler? Just buy AVGV which is a global value fund (holds those tickers plus some large-value). Don't want as much value exposure (want less tracking error, but less expected return)? AVGE is a similar product but with more modest tilts, and with 70% US instead of 60%.
You should regard all of your assets as one portfolio. The sum of its parts play together under the markowitz portfolio framework to give you an overall risk / expected return characteristic. Some accounts are better for different things, however. My 401k is limited in its options, so I get a lot of my international exposure in my 401k. It's basically 50/50 FXAIX/FTIHX. In my Roth IRA, because rebalancing is free, I engage in the "hedgefundie's excellent adventure" portfolio as of very recently in order to access leveraged beta exposure since I am very young. Rebalancing is every three months between UPRO and TMF to reduce the worst case drawback periods while still benefitting from leveraged exposure to equities and long term treasuries. This is pursuant to the works of Ayers and Nalebuff about time diversification of equity exposure. See the below paper if interested. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1687272. I also invest in small cap value funds in my IRA and brokerage, since I cannot do so in my 401k, again that's why my 401k serves as a traditional core portfolio of diversified equities with an overweight to international since my IRA is largely leveraged S&P500 exposure and small cap value. Avantis funds AVUV, AVDV, AVES for systematic factor tilt exposure.
I would go looking at their individual expectation of return and volatility, then I'd calculate the allocation that can maximise me the return from all 3 together Use Excel if you know how to calculate it... I use Diversiview (diversiview.online) as I found it's the single one it does this stuff... Tried your example and it gives AVDV 48.12%, AVUV 46.88% and AVES 5% for an expected portfolio return of 10.93% (compared with portf expected return 6.31% if you keep each equal at 33.33%). The %s will change in time so keep an eye on it..
I think if you were looking specifically at small value market cap, the US would have less than 60% of the global small value market. AVES is value but not small value, so you'd probably want to weight it differently. AVDV is smaller companies and has double the dividend. In other words, there is probably no answer. Pick what you like. Personally, I'd favor AVDV and AVES to reduce the black swan risk with a single country ETF.
AVLV, AVIV, AVUV, AVDV, AVES, AVMV. Or AVGV that captures them all.
I use AVUV, AVDV and AVES.
25% is AVUV, 5% each of AVDV and AVES. rest is VOO
How do you weigh out your AVUV AVDV and AVES holdings? 33/33/33? or mirror the global market?
AVUV has only been around a few years but it has outperformed SLYV and IWM pretty significantly since inception Disclaimer: I own AVUV, AVDV and AVES [https://www.portfoliovisualizer.com/backtest-portfolio?s=y&sl=rqiyLcyPmbzKEA7Woj3ak](https://www.portfoliovisualizer.com/backtest-portfolio?s=y&sl=rqiyLcyPmbzKEA7Woj3ak)
QVAL, AVUV, QMOM, IVAL, AVDV, IMOM, AVES and a bunch of commodity and bond futures (long/short trend following). Overall 100% equities 100% exposure to a \~20% volatility managed-futures program. No S&P500 in sight...
Rabbit hole time! What you're looking for is *risk factors*. Efficient markets only systematically compensate risks that investors cannot diversify. These priced risks have been defined in the 5-factor capital asset pricing model by Fama and French. The factors are equity, value, size, reinvestment, and profitability. Equity risk premium is the expected return in excess of the risk free rate (tbills or bonds or whatever is the best yielding risk free asset at the time). You get the equity risk premium exposure in your portfolio by simply holding stocks at market cap weights, like VTI in the USA or VT for global markets. Other priced risks are small caps, value stocks, and then especially value stocks with robust profitability or value stocks that reinvest conservatively (this means small cap value instead of small cap growth). Value in essence means that investors are demanding a greater discount on future cash flows (aka larger *expected* returns) because they precieve some risk in that company. Diversifying among risky companies like this leads to higher expected returns, so your portfolio grows faster/larger. Small cap value has outperformed the market since 1993 when the first true small cap value fund was deployed by Dimensional Fund Advisors, DFSVX. This fund returned like 11.18% CAGR when the s&p500 returned 9.95%. that's 30 years of over a percent per year outperformance, enormous implications for compound growth. We now have multiple great products in the small cap value space. AVUV (Avantis small cap value, very similar to DFSVX) and DFSV (ETF version of DFSVX released 2021). In a different vein, some small value funds have focused on free cash flows and future cash flows and lean into raw profitability like CALF and RWJ. AVUV/DFSV focus on low price to book companies with robust operating profitability so they have a financial focus, CALF and RWJ are focused on raw cashflows so they lean into consumer discretionary. I personally have 30% of my portfolio between AVUV, AVDV, and AVES. AVDV is international small cap value. AVES is emerging markets value.
SPLG for S&P500 AVUV for US small cap value. AVDV for developed international small cap value. VEA seems pretty good for developed mid and large cap. AVES for emerging markets value.
I’m around 25% AVUV. I also have around 5% each of AVDV and AVES for international. Like AVUV over slyv for the profitability/quality screen. Outperformed it significantly last year. Tbd if it continues
If you want to invest only in India, I imagine there would be an ETF for Indian markets, which sounds like what you are looking for. If you are looking to invest in emerging markets in general with an emphasis on India, there are a few ways to do this. I am a supporter of Avantis products. I gain 50% of my emerging markets exposure through their ETF, AVES. This is an emerging markets value ETF. 21% of its holdings are from India. It is surpassed only by China at 23% and followed by Taiwan, South Korea, Brazil, South Africa, Mexico, Indonesia, Thailand & Malaysia. Avantis products have higher expense ratios, but I believe it is worth the cost. If you wanted a more passive emerging markets fund, you could use VWO.
With this mindset you should be going 100% into global small-value, not growth. Growth (glamour, expensive stocks) historically has underperformed the market, and even more so value. 10-15 years in investing is noise. Buying something like AVGV would be a nice balanced approach to global value. Want more hardcore? Buy AVUV, AVDV, and AVES.
I’d ditch the growth and bolster value tilt (AVUV is solid), maybe add some foreign value (AVDV, AVES). SCHD is fine but very correlated to VTI. Better off with more small value.
0%. You want more risk? Hold small-value (AVUV), maybe momentum (QMOM), or even add a managed futures overlay (RSST is 100% S&P500 plus 100% trend overlay). And don’t forget foreign stocks (AVDV, AVES, IMOM, etc).
Eh, I dont think what judge is appointed is going to help much when the USD depreciates again. I'm going to keep my AVES allocation.
The 5-factor capital asset pricing model begs to differ. I've got a 40 yr time horizon and you're telling me to buy large caps when their shiller cape levels are at the same magnitude as pre great-depression and as the dotcom bubble runup? It's not over complicated when youre a college educated chemical engineer whose hobby is reading dissertations and financial treatises. It's also only recently possible for the retail investor due to the deployment of Avantis and Dimensional ETFs that allow domestic and international value targeted investing. Even with the value winter and the last 15 years of easy money era large crap growth, small value has still beaten large growth over the last 30 years. DSFVX, dimensional's small cap value mutual fund now available as DFSV in ETF format returned a geometric CAGR of 11.13% after fees. that's 118 basis points above the s&p500's geometric return of 9.95%. I'm perfectly content with my portfolio. 401k is maxed each year at 50/50 FXAIX/FTIHX (VOO, VXUS essentially) and my IRA is 100% small cap value or emerging markets value funds a la AVUV, AVDV, and AVES (mostly AVUV, keeping it roughly 60/40 US/international access all accounts). It's five funds, each with their own risk profile. It's extremely more diversified than a simple s&p index fund, and as a student of finance and history, the expected returns are potently higher, especially with country diversification. The safe withdrawal rate in retirement will be substantially higher than a pure large cap, one country strategy. All the gen Z and millennials on this site seem to have no understanding that the US underperformed international markets from 1950-1989 (do the math, that's 39 years) and the US underperformed in the 00's. They also seem completely oblivious to the fact that over every single rolling 20 year period, small cap value has outperformed the market. Every single 20 year period. That's how you capitalize on undiversifiable systemic risk premia (have a long time horizon to weather sequence risk). The practical complications involved with rebalancing a portfolio once a year between 5 simple buckets based on percentages is trivial. It takes minutes every year.
Index funds and risk premia funds for factor tilts. VTI/VXUS for market cap weights. Tilt the portfolio to long term 5-factor CAPM risk factors for higher long term expected returns (more volatile and has sequence risk, wider return outcomes range) using factor funds like AVUV for US small cap value, AVDV for international developed SCV, AVES for emerging markets value.
I ended up going with VOO AVUV AVDV VEA VWO and AVES. Probably going to condense the ETF's though because I want to use 10% of my IRA for holding some individual companies. I'll probably switch to VT + AVGV + AVUV to overweight US small cap a little.
The diversification doesn't result in lower expected returns. It results in higher expected returns (sans bonds). The manager is taking a fee to (ideally) provide a high sharpe ratio portfolio on the efficient frontier. When you look backwards, all data is skewed to the US due to price multiple expansion, so saying that diversifying to international stocks for example results in lower returns is a fallacy. It resulted in lower returns, but future forecasts over long time frames EXPECT high average returns with international diversification. This is especially true with emerging markets and small cap value, both of which also had a rough patch the last decade compared to large cap growths returns. Diversification increases EXPECTED returns, not decreases. Of course, adding bonds decreases volatility and expected returns, so they're a flavor to add depending on the desired sharpe ratio and risk tolerance. For example, I may wish to optimize a portfolio to the efficient frontier by adding a risk free asset, but what if I don't want an optimized sharpe ratio? If I'm willing to increase the denominator and stomach more volatility in exchange for a theoretically higher CAGR (based on 5-factor CAPM + efficient markets) I could invest in high volatility, higher expected return assets classes like small cap value using DFSV or AVUV. Paired with a domestic index, an international index, and some additional overweight to emerging markets value (AVES) and international small cap value (AVDV), the overall risks of the portfolio are less than the sum of their parts pursuant to markowitz portfolio theory.
AVNV, AVUV, AVES. The Avantis respecter has logged on. He is me. I am him.
Basically all of China is an emerging markets value play. The priced risks from Xi posturing like a warmonger and the undemocratic markets in China (limited inflows and outflows, and funky access structures) means that valuations are lower than their theoretical "fair" price. I'm debating going 10% of my portfolio into AVES which has a fair amount of China exposure and targets emerging market value stocks.
I wouldn't have AVES at all but I'd see the split better than having VXUS. If you want some emerging markets, pick them don't just take them all, especially those heaviest in China.
So do I just split the VXUS allocation to AVDV and AVES?
So I’d just replace 10% of my VXUS allocation with AVES Excellent, thank you
I hold emerging markets at market cap weights (between 10-12%). Within that allocation I tilt slightly towards value with AVES
If it was me I'd probably do something like this: 25% VOO, 15% AVUS, 10% AVUV, 20% QQQM, 20% VXUS, 10% AVES
That sounds pretty similar to what I may end up doing. My 401k is limited to Vanguard funds so I would keep it market cap weighted whereas my taxable and Roth IRA are likely going to be 50/25/25 AVUV/AVDV/AVES.
I don't go all in, mostly because of constraints on what's available in our 401(k) accounts, which only have DFFVX (Dimensional US SCV) besides some Vanguard MCW funds. But we have a strong tilt wherever we can (e.g. our Roth IRAs and HSAs are 40/40/20 AVUV/AVDV/AVES). Our overall retirement portfolio aims to maintain a 50/35/15 allocation for US/Developed/Emerging markets, with a factor loading of 1 on global market beta and a loading of at least 0.20-0.30 on both SmB and HmL (and some on RmW) by using Avantis and DFA funds wherever we can. Most of our SCV tilt is coming from US funds due to constraints, hence the slight overweighting of AVDV and AVES in our Roth IRAs and HSAs.
I tilt wherever I can. \- Roth IRAs and HSAs are 40 / 40 / 20 split between AVUV / AVDV / AVES. \- Brokerage is roughly 25 / 25 / 20 / 20 / 10 split between VTI / AVUV / VXUS / AVDV / AVES. \- My 401k has roughly 30% in DFFVX (Dimensional small value), since it's the only non-MCW fund available. My reasoning: all of these factor funds still have a market beta loading of around 1, so all I'm doing is exposing myself to different risk factors and sources of expected return to hopefully improve the long-run reliability of the portfolio. The funds in those accounts have a long time to run free, and I don't really care about tracking error anyway.
Nothing wrong with it but personally I like to keep it simple with something resembling VT + AVUV/AVDV. Or you could just do AVGV and let Avantis do the tilting for you. Breaking down VEA / VWO / AVES / etc. just seems like a lot of work. I'm also not convinced it is worth tilting emerging market to begin with.
In 401k, HSA, and IRA : AVLV, AVUV, AVDV, AVIV, AVES.
Does it make sense to load up on intermediate term bond ETFs like VGIT & BND and selling when rates drop again? I'm 32 and 12% of my retirement is in BND. I anticipated I'd be 100% in equities until I'm 45 or older but there seems to be great opportunities with bonds now and I'd love to get some insight about this. My equity portion is essentially VOO, AVUV, VEA, AVDV, VWO & AVES with a 24% factor tilt and 31% ex-US. As a newer investor, I'm still trying to figure out what my investing "style" is. I came in through the passive indexing door but am finding myself to be more of a tinkerer. I can't bring myself to just buy the same thing each month if one fund/company is perhaps trading higher or being overvalued while others are on sale. While these bond fund prices are at an all-time low, does it make sense to allocate, say 30% of my retirement to these intermediate bond funds and try to sell in 1-7 years when rates drop for a capital gain (is it called that with bonds too?)? I guess the worst-case scenario is that I'd have a 30% bond portfolio if interest rates somehow don't drop in that timeframe. My net income is about 38K as an apprentice in the trades, but I anticipate netting over 80K within 4 years. I've managed to cut my expenses severely to the point where I'm either saving or investing 45% of my current net income. I'd appreciate any feedback and apologize if I'm making any beginner assumptions. I'm here to educate myself and share that with others. Thank you!
Looking for downsides on my total portfolio. Or a 1-10 rating against my goal. VOO is only good option in roth 401k with match maxed annually. 1% on stocks are including fund overlap. Going for value tilts and believe in small cap premium Goal: 10-15M with index fund dividends > 100k after tax. Time Horizon: 20 years. High Risk 30-35% VTI 18% VOO 15% AVUV 5% AVDV 5% AVES 5% VEA 5% EFV 5% VWO 1% Google 1% Microsoft. 1% Apple 1% Tesla 1% Nvidia 1% Bitcoin 6% in Money Market
The podcast he mentioned also explains the full tilts as well. Long, but it goes into the history of the capital asset pricing model and how it performs. He is a Canadian tho. His fund recommendations for Canadians are different than ours. However, Avantis products are the same here in the US. AVUV for US SCV, AVDV for intl SCV in developed markets, and VWO or AVES for intl emerging markets.
Really depends. The most simple answer would be to market cap weight. The US is about 43% of the global equities market, so some might say to have 43% USA, 57% everything else. However, withholding taxes and historic returns should be considered too. I hold a majority American stocks as an American because the ETFs and mutual funds have now expense ratios and I will pay low taxes on it. I do hold AVDV for international small cap value exposure and AVES for emerging markets, but mostly I hold USA personally. I just don't care all that much for global developed markets due to their rising covariance with US equities. I save on foreign withholding taxes by staying in my country. The blanket answer you would get from the Bogleheads is 60% VTI/40% VXUS. Ample diversification in developed markets is a really simple and powerful way to invest for the long term.
I personally have VTI, AVUV, AVDV, and AVES, but if you buy Avantis products for small cap value or emerging markets, just make sure you understand why. Those investments suppose that you are going to hold a very very long time and that you believe that the small cap value risk premium is worth it for you. It's volatile, higher risk, and only for people willing to have a decade or more of underperformance, like this last couple decades where mega cap companies in the S&P took center stage. I invest roughly 30% of my portfolio in small cap value, both near and Abroad. It's because I believe in that risk premium and the negative covariance it has with market volatility. Also my time horizon is 36 years.
I can't be sure about the Schwab TDF you're seeing, but the "small-cap allocation" may be small-cap blend, which is different from small-cap value. Small-cap value tends to outperform over time but small-cap blend is often dragged down by small-cap growth stocks. What I do is own a total U.S. stock market fund, a total international fund and then 25% of my portfolio is titled toward Avantis small value ETFs. A 20% tilt like you have is still fairly aggressive if that's what you're going for. I will say though that I would seriously consider — if you are interested in tilting toward small value — adding international value funds. AVDV is a small value developed market fund and AVES is an emerging market value fund (all cap, because capturing small value emerging market stocks is difficult and expensive). Here's my portfolio for reference: 55% VTI, 20% VXUS, 15% AVUV, 5% AVDV, 5% AVES I would personally use Vanguard ETFs for your index position and Avantis for your value position. You can own these no problem at Schwab.
I haven't really changed anything yet, still researching. I split 80/20 for US/International, so actually the entirety of my international allocation just sits in my 401k which is just Fidelity's total international mutual fund. Outside of my 401k I do hold AVDV and AVES along with AVUV, those are all split along that same 80/20 ratio.