SPLV
Invesco S&P 500® Low Volatility ETF
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What Do I Diversify Into? (small $ monthly investments)
Advice on next potential moves for my retirement account
Planning on selling $11,000 worth of mutual funds in my TFSA. Thinking of buying VTI and SPLV (80/20). Should I diversity more? (Canada)
Putting 60%~ of savings in multiple ETFs? VOO, SPY, SPLV
Mentions
Did you do your DD before buying in? Aside from KDP all low/no growth, so with rising costs it means compressed margins. I don't think many are buy such companies for capital appreciation. If you were buying for distributions, better to use a diversifed ETF - SCHD or even SPYD. If buying for capital appreciation just buy VOO, or for less volatility SPLV.
Decreasing volatility comes at the expense of overall return. Are you sure that’s the trade off you want to make? The way I think about it is if you don’t need the money now or tomorrow, volatility does not matter. But to each their own. To your original question, look into low volatility ETFs. SPLV, for example, takes 100 of the lowest volatility stocks from the prior year.
If an ETF is “defensive” and at ATH, that doesn’t automatically mean it’s overvalued. Defensive sectors (staples, utilities, healthcare) often trade at premiums because investors pay for stability. The better question isn’t “what’s not at ATH?” It’s “what am I actually hedging against?” If you want lower volatility, low-volatility ETFs (like SPLV-type strategies) can help but they often concentrate in rate-sensitive sectors. If you want valuation compression, look at: –equal-weight versions of broad indices –dividend growth screens with earnings filters –international developed ex-US exposure But be careful chasing “undervalued defensives.” When something is truly cheap, it’s usually because earnings expectations are deteriorating. Defensive investing isn’t about buying what’s down. It’s about buying what you can hold through cycles.
At 27, time is your biggest edge. A broad ETF like VTI or VOO is plenty on its own. Owning both is mostly redundant, so I’d make one of those your core and keep it simple. If you want, you can add a small slice of something riskier for growth, but keep it small enough that you won’t stress during downturns. SPLV can smooth volatility, but it may lag long-term. Biggest key is consistency and not touching it when markets get rough.
JEPI might be a good investment choice for him. High yield and low volatility. It won’t help with long term growth, but aggressive investing in his 60s could make you both uncomfortable. There are some low volatility equity ETFs out there that might interest you like SPLV, USMV, VFMV, but all of them still had significant drawdowns in 2020 and 2022 like everything else. Another option might be defensive ETFs, but don’t expect S&P level performance: XLU, VDC, XLV, SPHD. I sympathize, my father never invested in the market either. He had a good run living off his own parents until they died and he inherited a fortune in assets, but given his nature he blew thru millions in only a few short years. Now any bills not covered by social security fall to my sister or me. 😡
Switch to SPLV instead, and forget about it.
They're probably just trying to cover their ass. Use a third-party service (like Morningstar) and look at each ticker. "Aggressive" is a broad range from 48-78. Stocks will all be in the aggressive category, even SPLV is aggressive, but only at 50. For moderate or conservative, you'll need to look to bonds. For some equity-adjacent funds which have a low risk, look at BALT or PBFR
I personally think VYMI is the sleeper pick right now, trading at nearly half the forward P/E of VYM or SPLV. It may be international equities but they’re all huge global companies just like the S&P 500, just valued much closer to historic means.
You’re planning to go 30% SPLV, the rest basically cash equivalents, and you think a pro portfolio is conservative? That’s like criticizing a car brand for not offering fast sporty cars when you are designing mini vans… like really slow mini vans. Like slower than a conservative car maker would make slow mini vans. Lol
SGOV is pretty good substitute for MMF or high yield savings acct for 4.1% today. You could get a slightly better rate with brokered CD's like 4.3% for 3month, currently. Do you like how SPLV held up around April-2 this year ? I doubt it. The problem with "exiting" your aggressive strategy, is that to me, it never feels like a good time to get back in, until the top. Of course that is much too late.
Hey man, you're spot on – today's numbers were definitely a mixed bag and didn't really light a fire under the market. Like you said, maybe a *slight* hint of weakness pushing the dollar down, but nothing crazy. It's interesting though, if you look a bit deeper, that drop in 'core capital goods orders' (basically, what businesses are ordering, minus defense and planes) falling 1.3% *is* a bit of a heads-up. It suggests companies might be getting a bit cautious with their spending. That often gives a clue about how industrial stocks (like XLI) and smaller companies (like IWM) might do, and both have been a bit sluggish lately, so it kind of fits. This ties into the bigger 'vibe' of the economy right now – feels like we're in a phase of slower growth but also low inflation. If you look back at times like these, usually 'safer' bets like healthcare (XLV), low-volatility stocks (SPLV, USMV), and solid bonds (AGG) tend to hold up better. Just thinking out loud, but it's a pattern worth watching. If you're into this 'big picture' macro stuff and how it can connect to your own investing, we actually break down these economic 'regimes' and share model portfolios based on them over on our site, [**macrolookup.com**](http://macrolookup.com), which you can check out. We try to make institutional-level insights accessible for regular investors. Might be helpful if you're looking for ways to navigate these kinds of markets! Hope this helps add another angle to your thinking.
Warm up with a light beer first… You should do some long dated options on lower volatility stuff… like calls on WM, USMV, SPLV… you went straight for the cocaine with 2x VIX etf (UVXY)…
JEPI SPLV GLD International Money Market
We’re in the same boat. This is what I did right around the tariff pause, put a couple hundred in. My prior experience was holding Microsoft in 2019 and shitcoins and options on here during the pandemic. Good times but barely came out even. Go for it. Drop a few hundred in to start and throw $20 or $40 in depending on the feelings that week or day. Start diversified. Your gains won’t be massive but everything is so volatile that there’s no winning. Experiment, learn more about different stocks and ETFs. Go international, gold, etc. Look for low volatility like SPLV or even RSP. Maybe there’s another bottom coming and then you can reevaluate putting in significant amounts of money. For now just cut your teeth in this insanity to get a feel for it. Or puts on SPY and fingers cross
I have equal weight in following. SCHD, SPLV, SPY, QQQ, GLD, and BND. It’s less volatile than VOO/QQQ.
I'm doing 80% cash, 20% SPLV, VIG, and SPYD.
That depends on what you're selling. If it's an individual stock and you have reasons to believe that it won't grow as much as you anticipated it to, or if you think there's a better opportunity out there, then yes it would make sense to sell. However, if you're selling an ETF then something was not right with your choice of ETF to begin with, or maybe you didn't consider risk tolerance carefully, which in that case you shouldn't bought an ETF such as SPLV (S&P500 low volatility) instead of QQQ for example.
SPLV and TQQQ start buying $500/week of each starting NOW!!!! U are blessed don’t lose or take those 5 dimes for granted
Never. Because I don't "VOO and chill". I don't do anything "and chill". *Something is always going up.* You don't have to time the market tops and bottoms perfectly. In fact, you can't. What you *can* do is detect the major medium-term shifts in the market, and rotate accordingly. Tactical asset allocation, aka momentum rotation, was researched and published 30 years ago, backtested on the entire market history, and has continued to outperform the market — primarily by significantly reducing the deepest and longest drawdowns by rotating into other (e.g., gold, bonds) or narrower (consumer staples, low volatility) assets. Don't just take my word for it, read the research: [Ned Davis 3-Way Model](https://portfoliodb.co/portfolios/three-way-model-by-ned-davis/) [Meb Faber 3-Way Model](https://mebfaber.com/2015/06/16/three-way-model/) [Gary Antonacci's Global Equity Momentum Strategy](https://svrn.co/blog/2015/8/2/is-gary-antonaccis-global-equity-momentum-strategy-robust) Personally, I did a defensive rotation in early February, when it became clear that unpredictability/volatility was going to be dominant. There were technical indicators as well as just paying attention to the news. There were early warning signs as early as the first of January, but look at what the defensive rotation looks like since the inauguration (1/20) XLP +7.28% SPLV +5.05% REZ +6.96% (you can also check XLRE and VNQ) IAUM +7.24% (or GLD) XLV +5.77% vs VOO -2.71% QQQ -3.80% *Something is always going up.* You can "...and chill" or you can stay in the fast lane.
I just bought some SPLV like a big old pussy
I’ve decided on the following: 1. TLT - Should maintain value or even increase if the economy worsens. Pays a dividend in the meantime. Also, the Trump admin has repeatedly said they want to get the 10 yr rate down. TLT would appreciate in this instance. 2. SPLV - Low volatility stocks appreciate in case we are still in a bull market and lose a lot less than SPY in a bear market. 3. ACWX - Most of the “overpriced” stocks are in the USA. Having exposure to equities is important to maintain purchasing power; buying stocks that are cheaper may help avoid a big crash. As well, individuals and institutions may want to diversify outside the USA b/c of this administration. 4. BTAL - Not really a long term hold. But can appreciate significantly in the event of a crash and not lose much or even gain in a continuing bull market. 5. CTA - Helps maintain purchasing power if commodities take off. 6. IYR - Helps maintain purchasing power by investing in real estate. Should do well if 10 yr yield comes down. 7. TSLQ - Who among us can resist shorting the world’s biggest most overpriced meme stock? Plan to take profits on BTAL/CTA/TSLQ as they come. These aren’t good long term holds.
I’m thinking: 1. SPLV 2. BTAL 3. TLT 4. IYR 5. CTA 6. TSLQ 7. ACWX Decided against GLD b/c it is already overbought.
Really, proper diversification is your best hedge against ups and downs. But if you’re looking for the comfort of a security designed to work for you…look into low volatility ETFs. I can’t speak to which would be best but take a look at SPLV. I think it would be a good replacement for a fraction of the expense ratio.
SPHB. It's not beta-weighted precisely, but... Wait, you want an inverse beta-weighted fund, not a beta weighted fund? There's a bet-against-beta factor. BTAL is a market neutral version, but you want market exposure. I thought there were more BAB but now that I look, they are mostly using the similar min-volatility factor, like USMV SPLV VFMV SPMV. But that should work for your purpose.
There are many reasons why they’re cap weighted. First, it follows the way the market, in aggregate, allocates capital. If you had a lot of money, a reasonable way to allocate would probably be to give more money to solid companies, less to more risky ones, etc. If you follow a cap weighted index you benefit from all the effort that all market participants make in deciding the best way to allocate your capital. A market cap weighted index also requires less parameters, discretion, trading, etc. It’s just more simple to implement. From what you write it seems that you either (1) want to invest in stocks with low beta, or (2) some fund that doesn’t decide what to invest in based on market cap but in valuations related to some fundamental. They’re different ideas and there are funds for each of them. If you want low volatility, there’s SPLV, which invests in the 100 less volatile stocks of the S&P 500. It doesn’t weight all S&P 500 according to volatility because that would just be too hard and costly to implement. If you want something that takes valuation into consideration, AVLV is probably the best option. Both of those funds focus on US large caps, which seems to be the investing universe you’re interested in.
No reason to mess with DIA. The Dow is a bit of an antique. I'd buy SPLV (low vol s&p) or just more SPY with the money. In all honesty, I wouldn't bother with Q's either. But I get more beta with Q's I'm not sure what I get from the Dow.
Hi Op. I too just opened a Roth IRA a few days ago and put 7k into it. Here my port after doing a fuck tone of research . Googl, Botz, QQQM, SOXQ, SPLV, NVDA, and VOO. I especially like SPLV AND (QQQM and VOO) SPLV being super low risk and qqq-voo being good growth ETFs. NVDA is at a dip so I'd buy a few while there on sale.
I just sold my 30 shares in SPLV up 3% and put it all into Nvidia with the dip. Lost 400$ since I bought it
Just go low volatility look at what is in SPLV holdings to get an idea. Consumer Staples and Utilities are usually good bets
NVDA is a good choice if you’re investing in individual stocks. They will be an AI infrastructure leader for at least five more years. In a year from now you’ll be happy that you bought it. VOO and QQQM are great choices but I’m biased towards index funds. If history is any indication, VOO should return 10% annually if you reinvest your dividends. QQQM will do even better for the next few years because we’re in a technology super cycle if you believe in the AI revolution. I don’t know why you bought SPLV. You’re young and shouldn’t be worried about volatility in the market. It goes up and it goes down but 75% of the time it goes higher. In my opinion, you should put those assets into VOO or something similar. Good luck with your portfolio.
Risk/reward is the name of the game. High risk, high reward (especially over the past decade)? TQQQ. Medium risk, medium reward? VOO. Low risk, low reward? SPLV. However, at your age, maximizing personal income will change your trajectory far more than making a smart investment with limited capital. For that reason, I recommend investing in yourself. What skills can you learn, what businesses can you start, etc.
I've used SPLV for years to off-set my other more aggressive holdings
I woke up one morning, and I had one question, could Low-Volatility Dividend Stocks Be a Smart Choice for noob investors? The stock market can be a wild ride, especially in times of uncertainty and volatility. That's why many investors look for ways to reduce their risk and protect their capital, while still generating income and growth. One strategy that can help achieve this goal is investing in low-volatility dividend stocks. Low-volatility dividend stocks are stocks that have a low beta, which means they tend to move less than the overall market. A beta of less than 1 indicates that the stock is less volatile than the market, while a beta of more than 1 indicates that the stock is more volatile than the market. Low-volatility stocks can offer several benefits, such as: - Smoothing out the returns and reducing the drawdowns during market downturns - Providing a steady stream of cash distributions that can be reinvested or used for other purposes - Signaling confidence and financial strength from the management, as dividends are usually paid from earnings or free cash flow - Offering the potential for dividend growth, as companies with low-volatility tend to have stable and growing earnings Of course, not all low-volatility dividend stocks are created equal. Some factors to consider when choosing the best ones are: - The dividend yield, which is the annual dividend divided by the share price. A higher yield means a higher income, but it can also indicate a higher risk or a lower growth. A reasonable range for dividend yield is between 2% and 5%, depending on the industry and the market conditions. - The dividend growth, which is the percentage change in the dividend over time. A higher growth means a higher income and a higher capital appreciation, as dividends tend to reflect the earnings growth. A consistent track record of dividend growth is a sign of a healthy and profitable business. - The payout ratio, which is the percentage of earnings or free cash flow that is paid out as dividends. A lower ratio means a higher safety and a higher flexibility, as the company can retain more earnings for reinvestment or debt reduction. A higher ratio means a higher income, but it can also indicate a lower sustainability or a lower growth. A reasonable range for payout ratio is between 30% and 70%, depending on the industry and the market conditions. Based on these criteria, here are some examples of low-volatility dividend stocks that can be attractive for investors: - Walgreens Boots Alliance (WBA), with a beta of 0.75, a dividend yield of 4.2%, a dividend growth of 6.5% per year for the last 10 years, and a payout ratio of 41% of earnings ¹ - Lockheed Martin Corporation (LMT), with a beta of 0.87, a dividend yield of 3.0%, a dividend growth of 11.6% per year for the last 10 years, and a payout ratio of 40% of earnings - McDonald’s Corporation (MCD), with a beta of 0.58, a dividend yield of 2.2%, a dividend growth of 9.8% per year for the last 10 years, and a payout ratio of 64% of earnings - iShares Edge MSCI Min Vol USA ETF (USMV), with a beta of 0.75, a dividend yield of 1.8%, a dividend growth of 9.4% per year for the last 5 years, and a payout ratio of 42% of earnings - Invesco S&P 500 Low Volatility ETF (SPLV), with a beta of 0.75, a dividend yield of 1.9%, a dividend growth of 8.7% per year for the last 5 years, and a payout ratio of 46% of earnings - iShares Edge MSCI Min Vol Global ETF (ACWV), with a beta of 0.66, a dividend yield of 2.1%, a dividend growth of 7.2% per year for the last 5 years, and a payout ratio of 51% of earnings These low-volatility dividend stocks can offer a balanced mix of income and growth, while reducing the exposure to market fluctuations. They can be a smart choice for investors who want to diversify their portfolio, enhance their returns, and sleep better at night.
No downside to multiple ETFs but VOO and SPY are identical. No need to have both. If in a retirement account, sell SPY and put it into VOO. If in a taxable account, just don't buy any more SPY. No reason to sell and create a taxable event just to simplify things. SPLV and REET are crap. I'd sell them right away. The others all overlap to some degree, but that is no big deal.
I'm 27 and am just talking about saving for retirement here. It would be nice to retire early, but I'm patient. Currently, I am invested in a lot of ETFs (I heard they were good and so just Googled "good etfs" and basically bought some of everything that came up). I currently hold shares in REET, SPLV, IYY, VOO, QQQ, VT, SPY, and VTI. Here are my three questions: 1. Is there any downsides to being invested in this many different ETFs? 2. Should I try to consolidate into just a few of them? If so, which ones? 3. Which ones should I continue to buy into monthly?
Looking for some advice. Still pretty young, and got a long time to save. Planning on doing the thing where you buy a set amount every month and then just hold forever. Right now, I have some money (probably the majority now that I think about it) in single stocks. I'm thinking about selling out of them (most are doing pretty well, a couple are trash) and moving everything to indexes/ETFs. Currently, I already do own some shares in some index funds and/or ETFs (I actually don't know what the difference is or if there is one) VOO, SPLV, IYY, REET, VTI, SPY, and VT are the ones I own shares in. Here are my two questions: 1. Should I go through with my plan to move out of single stocks? I was thinking about doing it over time, selling off only a set amount every month and buying back in on ETFs/Indexes. 2. I recently read a suggestion that you should stick to 2 or 3 ETFs. Obviously I have a lot more than that. Should I also try to consolidate down into a few ETFs, instead of owning shares in so many?
Value stocks on the whole have indeed been more volatile than Growth stocks historically. And so-called "deep value" stocks are those downtrodden, bargain bin stocks which are definitely riskier than mega cap growth stocks. But then of course there are low vol, "defensive" Value stocks with strong earnings with funds like SPLV. So a little more nuance to it. Again, timing, valuations, and recent performance aren't relevant to that assessment.
Never put your all eggs in one basket. Take a look at this mixture for example: - 40% Bonds (BND) - 20% Dividend Stocks & REITs (VIG, SCHD, VUG) - 10% Covered calls ETF (JEPI) - 10% Low Volatility ETFs (USMV, SPLV) - 10% Inflation linked Bonds (TIP) - 10% Short-term Treasury (SHV) Doesn't that seem more sustainable for the long term?
SPLV there used to be a lot more choices, but I think a lot of people got tired of underperformance. I started the position at the end of 2014. Low volatility can greatly out perform over most 30 -40 year time periods. The problem is you have to be comfortable with underperformance for 10-20 year periods. Only thing I found that came close to performing as good as value on backtest over lots of different time periods and countries. Momentum can beat it also if you're willing to hold. I would just really hate to retire and be in the down year for the strategy. With all that being said it has really tried my patience and did worse than high beta SPHB during the COVID drop. I kind of regret starting the position. Back tests are super easy to replicate. All it does is take the 100 least volatile stocks based on trailing 12 months volatility in SPY and weight inversely to their volatility levels. Then just rebalance once a quarter. S&P has a paper somewhere that backtest 50 years into the 70s. This one goes back to the 90s. https://www.spglobal.com/spdji/en/documents/education/education-low-volatility-a-practitioners-guide.pdf
Get some QQQ SPY SPLV VOO and VOOG. Save yourself the worry and enjoy less work than everyone on WSB
OP, use the most common broker Robinhood to buy fractional shares and consistently purchase stable ETF’s like SPY, SPLV, QQQ and use that as a learning mechanism until you finally understand the basics of stock selection.
Any thoughts on low volatility USMV or SPLV?
Unfortunately JEPI doesn't have as long a history as the others to analyze. But since inception SPLV has performed about the same as JEPI (+27-28% with dividends). Decline has been similar. *But* post-tax SPLV would have been better since more of JEPI's gains are dividend income. I previously dismissed covered call ETF's like XYLD, etc because they had equally awful [down capture](https://www.tradingview.com/x/UzOo3VIY/) in 2020 with less recovery and higher taxes. I don't get the infatuation with these. JEPI's ELN's seem interesting but it seems hard to [evaluate](https://www.reddit.com/r/qyldgang/comments/vncwo2/why_would_you_guys_ever_invest_in_in_yld_when_you/ie8pcbj/) this type of opaque derivative. If you have any good analysis of this (or leveraged ELN ETF's that were around in 2020) I'd be interested. They also use leverage so it's kind of trading one risk for another. So JEPI seems more defensive than XYLD/QYLD, but worse post-tax performance than SPLV, has some murky derivatives and leverage, and too short a history to conclude how it'd do in a real panic. Maybe an interesting lower beta allocation but IMO there are better ways to manage risk.
I honestly don’t:/ In my portfolio (which I started this January) I have only have CIBR & the rest of my holdings are individual stocks. My fiancé got a new job that has 401K matching so I’m in the process of finding a few for her & so far all I have on a watchlist for her are: CIBR XLU SPLV VGT VGT seems a bit similar to CIBR conceptually but they have hardly any overlap in their holdings, so I’m most set on VGT & CIBR for her but I’m still doing some googling & whatnot. I wanted to find a good EV related one & came across the KARS etf (KraneShares Electric Vehicles & Future Mobility) but I’m not sure if I like it all that much yet, so I’ll be looking into that kind of stuff once the Bidirectional Charging Act goes from “introduced” to “passed”.
Buy SPLV and forget about it for a decade.
SPLV attempts to do this and is okay at it
If you want to park some money in something relatively safe while you figure out what you're doing, something like the SPLV exchange-traded fund is a pretty safe bet. It's Invesco's S&P 500 low-volatility ETF. It takes the 100 lowest-volatility stocks in the S&P 500 (over the last 12 months) and equal-weights them. It tends to underperform, but the price swings aren't as crazy. The risk is...ehhhh...it's very overbought right now, and the current rally is losing steam on low volume, macro isn't great, it's kinda cyclical-heavy going into a possible recession, Fed is drying up excess liquidity, we never reached true mean reversion, the average PE for SPLV is 20 due to defensive positioning, and if that was the whole bear market, it was comically brief...so I still strongly suspect you'll have a chance soon to buy it cheaper. But I digress. Yeah, as a first buy, it's a fair choice. Or you could just buy the whole US market (or a representative sample, anyway) by buying VTI.
Yea that’s true. I’m just shocked the market is rallying I really didn’t think Powell sounded so dovish. In addition to being invested in JEPI for most of the year (JP Morgan ETF that mirrors SP500 but sells covered calls on holdings to generate ~12% yearly yield) I scooped up some shares of a few companies I think are well poised for the future and any recession/economic down turn (AMZN, TMO, AAPL) as well as some consumer staples and other stable stocks (SPLV etf). I also try to diversify by having about 5% of my portfolio in AGG (a bond ETF) and 5% split between to REITs I believe in (AMT and PSA). That being said, I also recognize this market is nuts and we could be in for another huge down trend, so to hedge I have some SPY puts
I agree. You are heavily weighted in Tech. Even just adding an ETF or 2 like this person suggested. I like SPLV it pays monthly dividends and invests in the safest dividend paying companies in the SP500. I also like DIA its another ETF that pays monthly dividends and it tracks the Dow Jones which has a lot of diverse companies.
SPLV is the subset of VOO that's low volatility. I.e. it's the low volatility companies in the S&P 500. Verizon, Pepsi, J&J, Coke, Berkshire, Duke Energy, etc.
If you want low volatility, there are low volatility ETFs like SPLV.
I recommended rotating to SPHD DEF SPLV and other defensives here in December. Also kept my position in GUNR for commodities. Sold DEF and SPLV as they weren't as defensive as I hoped and took profits on SPHD and GUNR. I have a lot of cash now and dipping into bonds (my first clip was too early).
My GUNR, SPLV, INFL, and BRK have been killing it. Stablecoin lending yields dropped a bit but still a solid 6% yield. I've been researching managed futures funds as another option. PFIX if you think rates have higher to go. Although TLT is so beat up it might be a buy soon. I unfortunately bought some too early. I'd average into Bitcoin in the 30k's.
Higher yield fixed income becomes more attractive than growth companies whose profits may be in the far future so growth takes a hit. Value and dividend stocks have done fine because they are profitable in the present. My BRK, SPHD, INFL and SPLV are at all time highs.
Something like SPLV or USMV sounds like what you are looking for.
In my opinion it's a win-win for you. If the markets go up at the end of the day even though the taxes suck you come out ahead. If you invest and it plummets, use the opportunity to start beating down the IRA balance in chunks by moving more shares to a taxable brokerage. Again, it all boils down to if you need these funds for day to day living or if you want to use this to pay your future self. If you want to invest while also staying conservative to the downside, something like SPLV or DGRO may be what you're looking for. During the downturn in 2020 I used it as an opportunity to do some big Roth conversions. It's worked out really well and I'll never pay taxes on those gains which gives me a sense of comfort at night
I prefer factor style funds like DEF/SPLV or SPHB to move from low beta/defensive to high beta. I wrote about rotating to DEF/SPLV last Nov-Dec which has worked out well. These factor funds group similar sectors together so you just have to make one trade instead of a dozen. I will sometimes overweight one sector. But generally that is too granular for me.
I've been talking about rotating to defensives all month and been getting downvoted. https://www.reddit.com/r/investing/comments/rujpqr/too_many_people_are_getting_influenced_by/hqzs1r0/ >Since the unprecedented 2020 stimulus as little as possible other than emergency fund cash. This year I would be rotating to a more defensive 60/40 at opportune times this quarter if you want to risk manage around the fed starting to tap the brakes. >I put about half of what used to be my bond/cash allocation into stablecoins now to get 8-9.5% yield. https://www.reddit.com/r/investing/comments/rtu6qk/50_years_youngwhat_advice_can_you_give_me_with_my/hqvgtwo/ >Most of this sub still hates this but I'd do a decent allocation to stablecoin lending at 8-9.5% right now rather than the standard 60/40 of negative real yielding bonds. >If I had to go into stocks for the first time this year I'd probably do a more defensive ETF like DEF or Berkshire, treasury bonds, and a few percent BTC/ETH up to your risk tolerance. https://www.reddit.com/r/investing/comments/rtj2oq/where_to_invest_in_a_bubble/hqtqppe/ >DEF Invesco Defensive Equity ETF https://www.reddit.com/r/investing/comments/rfhh51/where_would_you_park_your_cash_reserves/hoevvag/ >To simplify some of those individual equity sectors I like Invesco's DEF Defensive ETF and SPLV low volatility ETF.
I just added JEPI, DIVO and VTI to my Roth. Also looking at SPLV as a hedge against volatility.
Anyone know if SPLV is glitched for the 67 call it say its up 1700%
To simplify some of those individual equity sectors I like Invesco's DEF Defensive ETF and SPLV low volatility ETF.
Unless you have medium term liquidity needs hedges are a waste of $. You’re at least the 100th post of there being a crash coming soon. There are armies of people that work 4000 hrs a year on the markets trying to forecast this shit. In the mid 90s there were reports of an imminent crash (It ran up another 50% over the next few years). GME, and AMC, FWIW, are terrible hedges. If there’s a crash, the apes on here on balance more leveraged than the rest of the market. There is not some $10B pool of reserves on this board to come to the rescue. There ARE a good chunk of folks on here at risk of a margin call. If you really wanna hedge, buy SPY puts, VIX calls, and move more of your portfolio into SPLV. But we’re in a market where the money supply has expanded significantly yet interest rates are STILL low, and all the other major financed assets (houses, cars, etc) also have seen massive price increases. When everything gets more expensive, you don’t have a bubble, you just have inflation. So think twice about if you’re really seeing a bubble, or inflation.
Nothing I say below should be construed as financial advice, and is generally for educational purposes. Firstly, just to touch on VTSAX, it is a nice simple starting point, but IMO, it's not particularly as diversified as people might think. Sure, there's a lot of companies in it and it is somewhat diversified across the cap spectrum, but it's still predominately US Large Cap Equity. It suffers from the same issue that the S&P 500 has with high concentration at the top end of the spectrum with the top 6 names making up for 20% of the portfolio. However, I certainly wouldn't crucify someone for investing in VTSAX because it's good, cheap general U.S. market exposure, but just so you know, investing solely in VTSAX is inherently making a bet that the US large cap equity market is the best market for investing (not necessarily a bad assumption), and large-cap growthy tech in particular is going to drive a lot of the volatility and return in your portfolio. Portfolio management for someone of your mother-in-law's age should take into consideration more things than just growth at all costs as the main goal. Generally, more important than growth is trying to manage the risk such that she doesn't outlive her nest egg and she continues to have enough income or distributions to ensure her lifestyle isn't impaired later. This leads to de-risking the portfolio so it's not exposed to big swings in the market. When you're younger, big swings don't really matter because you're not drawing on the portfolio. When you're in retirement, you are and if you're drawing on a portfolio that's been impaired by 30-40%, even temporarily, can materially impact the future value of the portfolio. Taking into consideration your mother-in-law's age, I'm assuming this is her whole nest egg and doesn't have any other significant income except social security. So if this IRA's value were to materially fall such that it would increase her chance of outliving the pool, that wouldn't be a great outcome if it's positioned for long-term growth when her time horizon is not long-term. You don't want her to run out of money. Now, having said that, when actually looking at the portfolio, the fund mix you presented is unnecessarily diversified with overlapping fund exposures, high expense ratios and sales loads. This isn't atypical for financial advisors, but is indeed infuriating. Assuming each fund is equal weight, the portfolio resembles a 70% equities, 30% bonds portfolio, with allocations to global regions including international stocks and emerging markets. There's also some min-vol factor ETFs (SPLV, XMLV, etc.) in there that I presume are supposed to reduce exposure to the high beta names in the portfolio. The bonds portfolio is primarily core bonds, with some high yield and muni bonds ( \[SMMU\] which is odd in a tax-exempt portfolio...), but nothing super exotic. Generally, I'd say this feels like a relatively generic mix of global equity vs. bond exposures with some volatility dampening characteristics. It has multiple funds that play in the same asset class (i.e. LSGRX, SBLYX, OILGX, and SBLYX are all large-cap growth funds). This is not necessary IMO. The average fund fee here appears to be about 0.75%, which is a little high IMO. Plus 1/2 to 2/3 of these have sales loads, meaning the advisor receives a commission for putting that specific fund in the portfolio. I didn't investigate how each load is applied, but it looks like they can be up to 3-5% on the front end, and 1-1.5% on the back end (when you sell). This is the worst part about working with financial advisors. They're incentivized to select which funds provide them the biggest kick-back, not the ones that are the best for the investor. Plus I'm assuming there's an advisory fee to the advisor of 1%+? So this is an expensive relationship for sure. How has the long-term growth of the portfolio been? I was in your situation with my mom a few years ago, and ended up putting her with a robo advisor and I just monitor it for her. They're super cheap advisory fee-wise and use super cheap funds, often Vanguard. She's been extremely happy with it. Sorry for the wall of text. Clearly I like this kinda stuff...
Low beta; BRK, SPLV, MSFT, COST are examples. You can make your own beta: 1x SPX ETF and 0.2x inverse ETF will give you 0.8x beta. So you will move up/down 0.8x of SPX. Combos allow you to adjust beta; replace the 1x with 2x or 3x levered to add beta for example if u feel you are at some kind of bottom.
This is exactly how I ended up with overlapping ETFs. None of them were/are in tax-advantaged accounts, and other people bought most of them. I bought IVV, was then gifted SPLV, and finally inherited the two vanguard funds. Haven’t touched them since. I guess it was silly to list them all in my post, when the point (e.g. “the market generally is going up over the operative timeframe while TSLA is going down”) could be made with just VTI.
Why on earth do you hold IVV, SPLV, VOO, and VTI? Overlap city
My main ETF plays this week are DIA, SPLV (Low volatility S&P), and VTV (Value Large-Cap). Opinions, am I dumb or ok?
depending on her reaction to a steep drop, might want to look into a low-volatility ETF or fund to replace the S&P 500. look in the fundamentals for a fund/stock for the 'beta', which measures volatility relative to the market. the S&P 500 or a total market index will have a 'beta' of about 1. the ARK funds will have a beta of about 1.6 or 60% sharper ups & downs than the market. a low-volatility fund might have a beta of only 0.5 or 0.7, so the ups & downs will me smoother. low volatility stocks are more likely to be value stocks, big boring established companies, so will often pay a relatively large dividend. SPLV has a beta of .7 and has a yield of 1.7% https://finance.yahoo.com/quote/SPLV plus there are global low volatility funds to add some international exposure https://www.ishares.com/us/products/239605/ishares-msci-all-country-world-minimum-volatility-etf also look at beta for the bond fund, they can be almost as volatile as the market which kinda defeats the purpose of adding stability. Peter Lynch of Fidelity said somewhere that bond funds can give a false sense of security. if longevity counts for something to her, look at DODBX, the Dodge & Cox balanced fund. established in the early 1930s it's one of the oldest mutual funds still in existence, and IIRC the oldest that's still following its original mandate: ~70% blue chips, the remainder in quality bonds. fees are reasonable, and Dodge & Cox has an absolutely spotless reputation (Jack Boggle was a fan, saying they were one of the few active managers he'd recommend due to their long-term mindset, low turnover, and high ethical standards).
SPLV just spent the last 14 months catching up to where it was in January 2020. That ain’t my kind of safe.
Consider that VTI attempts to emulate the entire market and SPY/VOO accounts for most of the market (by market cap). By definition this means that it will include both risky and safe stocks. From there, if you take out the risky ones, and you have a safer basket of stocks. Aside from the obvious non-stock ETFs (bond funds are obviously about 10x safer than SPY), there are low-volatility ETFs that are composed of more stable stocks, and they typically see much smaller pullbacks during times like this. At the time of writing, SPLV is down 1.08% while SPY is down 1.87%. Which is safer?
SCHB, SPDR, SPLV, QQQJ, QQQM (These are all essentially index ETFs that have a price per share that is relatively low). SPLV may be good to start out with because it is low volatility.
Even SPLV - a low volatility ETF, has been a little volatile recently
When I was shopping around for ETFs, I compared all the major ones, and SPY is probably the one that had the highest 10 year return. This was just comparing different index ETFs. You can try this yourself, it's super easy. Yahoo Finance charts let you easily compare multiple tickers on the same chart and then you can zoom out to 10 years and see which one had the highest return. Of course that doesnt guarantee it will continue like that in the future. If I had to guess, although I'm not 100% sure, the reason SPY rose the most is because of its general popularity and it's low expense ratio which lets it track the S&P 500 more accurately. Although don't take my word for it I'm just guessing. You can also look at low-beta/low-volatility ETFs such as SPLV or USMV. Those fluctuate less and over time make less return than others but they are "safer" due to less fluctuations. One way of comparing performance of ETFs is the Sharpe Ratio which is the ratio of the ETFs return to its standard deviation in price. Standard deviation in price is used as a proxy for risk in this case so the ratio acts as the ratio of return to risk. Obviously youd want to maximize return for the lowest amount of risk. Low beta/low volatility ETFs such as USMV and SPLV have some of the highest Sharpe Ratios that I've calculated when shopping around. You can perform the calculation in an Excel spreadsheet as well. Just get the historical price data from yahoo finance for an ETF, download as a CSV file, then calculate the return and use the standard deviation function over the historical prices. Then calculate the Sharpe Ratio and compare them. Ultimately, what you pick depends on your own risk tolerance and investing timeframe.
this gives a bit more insight. Aggressive? Like to hear that. I would be buying a good amount of etfs, diversified, and let them go to work. Check the companies in $MOAT, $SVAL, $USMV, $SMH, $XLY, $SPLV - like em, buy em. Oh and fuck bonds until rate come up. It's coming.