VT

cannythecat

VT would have still fallen 50 percent during the dot com crash, in a broad market sell off everything is going down together

WJKramer

What people arn't considering is how far reaching into other sectors of the market a tech correction will reach. Yes VT will be affected, obviously not as much as funds with higher concentration levels but it still will be felt.

MSFusionHV

Without a doubt it'll be impacted somewhat.. but by being much less concentrated in those names, it won't be as destructive. The difference between the 2000s burst and now is that back then international was richly valued too. Today it's different and VT would definitely fare better (but still take a sizable hit). If one really felt strongly about avoiding a major tech downturn, small value is an option as well as alternatives like managed futures which zig when the markets zag (though beware they are very challenging to hold individually without portable alpha/return stacking). What these high flyers gambling into these tech and semiconductor stocks and funds don't want to realize (or care.. because their capital is so low anyways) is that the downswing can be just as fierce as the upswing. Good luck to them..

L-Quantum-Raccoon

VT won’t tank like semiconductors even if that sector has a big correction. It only has a small exposure to chips and AI stocks, so losses there get diluted across thousands of global companies in other sectors. U might still see a dip if tech drops hard, but it would be much milder compared to SOXX or similar ETFs. That’s basically the whole point of diversification: less upside, but also much smaller crashes.

jcsehak

There is a cure, it’s at r/bogleheads. I learned the hard way betting into GME. Us plebes can give our money to billionaires at the casino or we can ride their coattails by DCAing into VTI (or VOO or VT or whatever you prefer).

MSFusionHV

Why bother with all of that? Just buy VT and be done with it, as most people won't be able to beat it long term. Stop focusing on the headlines and what stock pickers say. None of that analysis is going to benefit you or anyone else.

MSFusionHV

Stock picking is a loser's game. Stick with VT.

NineSidedBox

VT is about 60% US and 40% international. My ratio at the moment is the other way around. I've been moving away from US funds in the past few years, so just doing VXUS + VOO.

CaptainSt0nks

I think global population decline is not just noise and would affect VT

MSFusionHV

Nobody knows what is going to happen. Serious long term investing ignores the noise and what ifs. Pick a highly diversified global strategy (like VT) according to your risk tolerance and let it ride for decades to come. Simple.. but not easy.. and that is how you earn the equity risk premium. Stay in your seat and ignore the headlines. If one was really concerned there could be different styles like alternative strategies that are zero or negatively correlated to the stock market (I believe in these), but they require an enormous amount of conviction that won't be found on here. Best of luck!

MSFusionHV

Anytime someone is talking an individual stock, they likely are performance chasing and have a fear of missing out. If you want to be wise, invest in VT and earn the global market average return which most people, even professionals, will fail to beat after decades..

MSFusionHV

This is one of the reasons why the momentum factor exists. Anyways.. this doesn't really matter as picking individual stocks is a proven loser's game. Vast majority would be better off in VT. If one wanted to systematically pursue higher expected returns, then factor funds are an evidence based way to do that.. but you need very strong belief as negative potential tracking variance allows for potential positive tracking variance over the long term (there is no strategy that can do well at all times).

IBangTokyoWife

That's a lot of work to just likely match VT. Why don't you just go VT?

nanobot_1000

I held NVDA the past decade, cashed out last fall and now am in boring old VT/VOO resisting blowing it, but even that makes me nervous now TBH.

MSFusionHV

How do you know you are "moderately successful"? Are you certain you aren't wildly overconfident in your abilities? Have you tracked your entire performance against VOO or VT? How long have you been doing it, as obviously a lengthy track record is more meaningful than a short term track record.. though technically even 10 years could be luck. Wise long term investors just sit in VT, which will end up outperforming around 90 percent of investors over decades. Good luck.

MSFusionHV

Is this a joke post? Investing for 2 years? You hold cash or a short term bond fund.. You do not know nearly enough about investing if you think a 2 year timeframe is appropriate here for equities. IF you had a 10 year plus horizon you invest wisely into VT or AOA. Not playing the loser's game by picking sectors or individual stocks. All the evidence shows your strategy will not work reliably. Good luck

MSFusionHV

Timing a crash is impossible. People have said for 10 years the US market is overvalued. While I believe the market is due to an extended downturn, I don't know when that will be. It is possible things keep going up for another year or two or three... But there are decent ways to deal with this concern. First.. be exposed to global markets not just US (VT is an excellent fund). Second.. consider adding some value exposure. Third.. consider alternatives that are zero or negatively correlated to the market.. Fourth.. simply add more cash/bonds. All depends on your personal beliefs and tolerance for tracking variance. A crash isn't just about the initial drawdown which could go on for years but also the recovery and for example US large caps could stagnate for a decade while other segments do well. It's possible and many people aren't prepared for that. Good luck..

Ancient-Swordfish292

TSLA is 2.38% of the S&P 500 and 0.96% of VT. I'm doing VT and chill, so I am 1% concerned about TSLA. I actually hope it tanks. Elon is a jackass and bad for society, but please have some perspective here.

Machine8851

Thats good. You'll make more with the 20% VGT than you will with 80% VT

cantthinkofuzername

VT and chill. The math supports this over the long term. Go have a real life!

taplar

Optionally buy a total world etf, like VT.

BillNyeForPrez

Right? Just put 1.5m into VT and withdraw as needed.

subfloorthrowaway

At this level, Id probably be a little bit more conservative, 90% into VT, 10% into whatever bond fund. Then I'd retire.

aronnax512

You don't stick the derisked portion into a savings account, you roll in into a broad market ETF. It's also not going to zero (AMD is still a well run, profitable company with physical assets) but it definitely could tank 70% (it also could keep running). You'd be in a position where it'd be like if you'd bought VT or VOO with that initial money, plus received "free" shares in AMD equal to 2/3 of you current AMD share position. The point is to set a floor under your winnings where you won't backslide below where you'd be if you did the safe thing in the first place, without completely sacrificing future upside.

znightmaree

“VT and chill” income category

dissentmemo

I think if it's in VT I already am. If not, I'm not.

kmouratidis

Buy VT or some shit. Don't like it? Equal weights, small cap, value, small+value... There are many research-backed choices. Or YOLO into one random stock like a proper degen.

witchesbrewm

Whatever diversified ETF of fund you buy, you will always have a lot of tech. You could sell everything and buy a 60% VT and 40% BND or something like that. In Canada we have a lot of asset allocation ETFs (VBAL, XEQT, etc), but for some reason I can’t find a US equivalent.

kmouratidis

How did you get 37% though? VOO/VT are at 28%. Factor tilts? Margin? Includes contributions as gains?

Cruian

What would SCHD be doing for you? Single fund portfolios: https://www.reddit.com/r/Bogleheads/comments/tg1az5/should_i_invest_in_x_index_fund_a_simple_faq/ This is one of over a dozen links I have that can help explain the reasoning behind that: * https://www.pwlcapital.com/should-you-invest-in-the-sp-500-index - invest in the S&P 500, but don't end there (this covers info on both the US extended market and ex-US markets) [a total US market fund combines S&P 500 + extended market into one] US only is single country risk, which is an *uncompensated* risk. An uncompensated risk is one that doesn't bring higher expected long term returns. It should be avoided whenever possible. Compensated vs uncompensated risk: * https://www.whitecoatinvestor.com/uncompensated-risk/ >An uncompensated risk is a risk that you can diversify against. * https://www.northerntrust.com/middle-east/insights-research/2024/wealth-management/compensated-portfolio-risk or if that doesn't work, the archive link: https://web.archive.org/web/20260107205255/https://www.northerntrust.com/middle-east/insights-research/2024/wealth-management/compensated-portfolio-risk >But not all risks are compensated with an expected return premium. * https://www.pwlcapital.com/is-investing-risky-yes-and-no/ (Bold mine) >Uncompensated risk is very different; it is the risk specific to an individual company, sector, **or country.** Consider this: https://www.bogleheads.org/wiki/Three-fund_portfolio The bonds are the part that adjust volatility level (if you really can stomach 100% stock, they can even be set to 0%, however not everyone is actually able to tolerate 100% stock). More bonds should equal less volatility. Alternatively, a target date (index) fund or target allocation (index) fund are effectively the 3 fund concept in a single wrapper, managed for you. They are designed to be "one and done," the only thing you hold. They're fully diversified internally for you. These can be found with expense ratios as low as 0.08%-0.12% for the Fidelity, iShares, Schwab, and Vanguard index based ones. The target date and target allocation funds typically are not recommended for taxable accounts but are fine for tax advantaged. VT (2 letters)/VTWAX would cover both stock roles in one fund. >I want to keep it as passive as possible. Then I'd really be looking at the target date fund.

brotherstoic

Dump it all into VT and let it ride

Empty-Librarian6775

Without the '87, '88 and '89 returns: Risk free rate: 4.3357 VT 8.8874 / 17.4237 P2 with initial weight: 69% US 9.8736 / 16.8207 (B&H) 9.8315 / 16.7229 (R-1) 9.8090 / 16.6840 (R-5/25) 60% US 9.8292 / 16.7189 (B&H) 9.6412 / 16.9113 (R-1) 9.7233 / 16.8746 (R-5/25) 50% US 9.5003 / 17.3797 (B&H) 9.4115 / 17.2484 (R-1) 9.5301 / 17.2628 (R-5/25) P4 60% US 9.7846 / 17.2569 (B&H) 10.0081 / 16.9741 (R-1) 10.0052 / 16.9816 (R-5/25)

PastBuy8484

If it were me I’d do VT and forget about it. Adds some international exposure too.

steve_yo

5 years from retiring, I think I’d be tempted to buy something much broader than the S&P. Maybe something like VT. Sure, you might miss out on some gains, but with your proximity to retirement, you may also not dip as low if there is a correction. You’re nearing capital preservation mode.

Bman282828

VT especially with the short horizon to retirement.

GloomyCardiologist16

Maybe consider adding some VT so that you have a bit of international exposure

Empty-Librarian6775

US market cap was 69% of total market at the beginning of the backtest in 1970. A fair comparison would of used that allocation as a starting point and get even better results. P2 with: 69% US allocation: 10.17/16.51 (B&H), 10.20/16.43 (R1) and 10.22/16.37 (R-5/25). But a 50% US allocation does also well: 9.85/17.09 (B&H), 9.85/16.91 (R1) and 9.99/16.91 (R-5/25). Compared to VT: 9.33/17.08 So it's not the allocation overfit.

kmouratidis

They *think* VOO returns will outpace currency-adjusted VT/VXUS, so they keep pumping money into it, even if they're not Americans. Btw, YTD 9.84% vs 11.19%/13.98% respectively.

Empty-Librarian6775

**VT advantages** are overstated IMO, at some point a part of your portfolio will be fixed income and you will do some sort of re-balancing anyway. **Re "rebalancing premiums"** : the buy-and-hold portfolios, which don't actually rebalance, did better than VT. **Re** **"overfitting"** : I lean more toward a structural flaw in VT that affected it over that time period rather than overfit - last paragraph of the post gives a clue as to why. **RE "effect magnitude"** \- 1% over 30 years is 35% higher end wealth. \- QQQ - S&P500 over the same period is 0.72%

spectra2000_

VT and forget about it

Ancient-Swordfish292

VT

FootbaII

Now compare VT's returns to buying and holding Bitcoin from 2011 to today. VT lost? Hindsight is a powerful too, ain't it?

reggionh

lots of people who VT and chill isn’t doing it to max their gain. the “hidden cost” you identified is a mix of backtest overfitting and rebalancing premiums. even with all that, the edge is meagre. it doesn’t show structural deficiencies of VT.

Ancient-Swordfish292

VT and chill.

dissentmemo

VT

cjorgensen

VT and chill.

emcdeezy22

$VT

LibraryUnlikely2989

Buy VT tank the whole world

Iwubinvesting

VT

taplar

If you want to include international you could buy VXUS, or consider just buying VT. 

Nikoalesce

Yessir. 95% of my port is VT. 5% is whatever individual stock I think might be cool at the time. Currently it's EVLV. 

alteraltissimo

Yep. 90% in VT, 10% picking solid stocks which only go up. Never bought a non-paper option. Life is good.

Primary-Effect-3691

It'll be fast tracked to the FTSE Global All Cap too afaik, so in VT fairly quickly. It'd be significantly diluted in VT though, so a SpaceX crash won't have too much an effect on the portfolio (unless it brings the whole market down)

Ehh_littlecomment

Only QQQ is impacted by the float multiplier right? VT, etc should be relatively safe still.

seanmic1

1. Buy now. Always buy now. Especially if your planned holding period is 6 years. One month is nothing compared to 6 years. 2. A "safer" ETF compared to SP500 ETF would be something like VT, where you buy the whole world instead of just the US essentially. But since you are medium risk, why find a safer option? Go for a riskier ETF. 3. From experience nothing beats the SP500 in terms of the time investment to returns ratio. Especially for a 6 year time span. You can try to find a more niche ETF but that is up to your research. Perhaps some AI or robotics ETF might do well in 6 years? BUT I can't guarantee anything. 4. When having multiple ETFs, make sure they don't overlap, because then you'd rather just invest into one or the other. You can have some stocks as well, but if those stocks are already in one of your ETFs, then I suggest just sticking to the ETF unless you are making some deep calls. 5. The normal suggestion is 30% stocks and 80% ETF but that's again up to your preference. 6. Yes, you should take more risk. If you have a reliable source of funds in case everything goes to shit (e.g parents money), then you can afford to take more risk. Only if you are already financially struggling would I suggest to be safer. Hope this helps :)

Notable_Naps

I know this is a gambling sub but VT really is the single best stock to buy if you legit want to buy and not look at it for 5-10 years and be up. You're buying USA and international stocks in one etf. Alphabet isn't a bad choice but for pure no worry play you buy the market and chill. Obviously it won't have crazy growth levels but it's just about the "safest" stock play.

uncsucks

Yes but VT would be better (Sorry full port MU calls)

DoinIt4DaShorteez

At 35, I would say $70k in SGOV + 6 months of expenses is probably just about right amount of cash, probably a little more than you need. I mean you have to think of what your worst case sceanrio is and have the liquidity for that. You say stable, but $100,000 - $150,000 is a huge range, lol. I'm not familiar with "intelligent portfolio" or "go," i'm just gonna assume they buy individual equities. If you came to me and said you wanted to maintain your cash-equivalent positions as is and put all your retirement account money into VT and/or VOO or split it between them in some fashion, I wouldn't have a bad word to say about it. If you think your don't need 18 months (or how ever much $70k + 6 months adds up to) of expenses, then shave that cash position down a little and put it in VOO/VT or even take a couple small positions that you decide on yourself, to keep things interesting. Not meme shit, real shit.

TempeGrumble

Fidelity Go has a uniform expense ratio of 0.35%. Schwab IP (currently) just carries the ERs of the ETFs it pus you in, IIRC but no guarantee it won’t dump you in high-expense funds. VT and chill has a 0.06% expense ratio.

Valuable-Analyst-464

I was basically 95% equities my whole investing career. I read up on bonds and made the mistake of diversifying with them at too young an age. I am not sure what’s in your brokerage and what’s in the HYSA…maybe locking too much away. Before reallocating in the taxable account, maybe reset your retirement accounts. I would say VT or 75/25 (VOO or VTI)/VXUS.

gnetc

Just put it in a diversified ETF like VTI or VT, Dimensional has good funds as well that are great. If you don’t plan on touching the money for the next 20 years a correction isn’t really going to matter.

Capable_Ordinary_938

bro just VT and chill

Sufficient-Flan1565

VT and chill

BionicSteeze

Get out of index funds because of one company? Like for example would you sell all your VOO and VT ?

the_real_MSU_is_us

In theory, everything would be priced efficiently and you'd only have "winners" (ie beating VT average) from new info that helps a single company/sector, or unexpected innovation, or making good bets on subjective stuff like "the Pentagon will give the contract to this small company and 3x their revenue" Basically, if OP is right VT and chill is the only rational investing strategy

rayquan36

Why 50% of my portfolio is $VT

West_Flounder2840

Half my disposable savings into VT and the other half paying down the principal on my mortgage. I’m up quite a bit this year.

Ausky_Ausky

VT

fozzy71

I am in the process of going 100% AVNM for my exUS core to let them figure out the weights, but my largest core is IVV instead of VT. I was previously doing 1/3 each of VXUS, IDMO, and DFIV for my exUS sleeve.

holdencasey7

it's included in VT + I use AVES for the factor tilted portion

SwingLord420

Put it in VT and tell no one about this. Let it grow while you do your normal life. It's gonna have a huge impact on you down the road (2x/7years is $4mm when you're ready to start a family in early 30s, huge passive income and safety net at that age).  

burn_bridges

Don’t look at your primary residence as an investment. You always need somewhere to live, and should make that decision based on your specific needs/wants. VT and chill is the easy answer. I would caveat that based on your net work, having real estate as a portion of your portfolio for the sake of diversification (as well as tax advantages, as well as liquidity [if that matters in your current age]) is a serious consideration. I don’t know the math exactly, but if you have $2M it doesn’t seem unreasonable to have 20% in a $400k rental and the other $1.6M in VT. Again: primary residence is not an investment.

Interesting_Week_917

Bro the actual resolve it takes not to sell and place it into VT is amazing. If I had a stock worth even half of that I’d just sell and VT rest of my life. But fuck it man if you can ride it and make 10x that then you’ve just changed your bloodline

Legaon

I think what OP is actually referring to is the (capital gains tax distribution) part. Since IPOs + major IPOs, like (SpaceX) — has found a way to be included in these — indexes — S@P 500 index/FTSE Global All Cap index. The ETFs that “track these indexes” = (VOO) or (VT). And (SpaceX total valuation), is also being included with other “company revenue streams”. Tesla + etc. It just does not seem fair that: (1)IPOs, that launch on day 1 — should be able to bend the rules to — allow passive ETF investors to have to: (1)have ETF mangers sell massive amounts of shares in the ETF = massive capital depreciation activity/(2)use that money to now “buy SpaceX shares”. —passively managed ETFs, selling massive amounts of shares very quickly = major capital depreciation event. Big tax event for the (ETF manager). And the (ETF manager will just “have all of the ETF investors) — pay “tax event”. Capital gains distribution tax. Even though I do think that (space exploration + planet colonization of military bases + harvesting of the planet’s resources) — will become astronomically profitable in the next 10+ years. —>It’s just that: (1)if SpaceX IPO can bend the rules — and cause massive amounts of “capital gains distribution taxes”. Then, other IPOs might do something similar in the future.

Legaon

I think what OP is actually referring to is the (capital gains tax distribution) part. Since IPOs + major IPOs, like (SpaceX) — has found a way to be included in these — indexes — S@P 500 index/FTSE Global All Cap index. The ETFs that “track these indexes” = (VOO) or (VT). And (SpaceX total valuation), is also being included with other “company revenue streams”. Tesla + etc. It just does not seem fair that: (1)IPOs, that launch on day 1 — should be able to bend the rules to — allow passive ETF investors to have to: (1)have ETF mangers sell massive amounts of shares in the ETF = massive capital depreciation activity/(2)use that money to now “buy SpaceX shares”. —passively managed ETFs, selling massive amounts of shares very quickly = major capital depreciation event. Big tax event for the (ETF manager). And the (ETF manager will just “have all of the ETF investors) — pay “tax event”. Capital gains distribution tax. Even though I do think that (space exploration + planet colonization of military bases + harvesting of the planet’s resources) — will become astronomically profitable in the next 10+ years. —>It’s just that: (1)if SpaceX IPO can bend the rules — and cause massive amounts of “capital gains distribution taxes”. Then, other IPOs might do something similar in the future.

holdencasey7

WLDU (2x VT, but with possibly high internal costs), and NTSD (1.5x US Large Caps + International Developed Large Caps, rebalanced quarterly)

Singularity-42

The FIRE wisdom says that safe withdrawal rate that also accounts for inflation is 4%-4.5% - so you should be able to withdraw $400k-$450k every year, in 2026 dollars value, in perpetuity. This assumes investments in broad based index funds like VOO or maybe even better VT (or some Bogleheads mix). CDs are gonna get eaten by inflation and by the time you're 90 it may not even be enough to live on. You gotta stay invested in appreciating assets.

killa_volt

Can anyone explain why some stocks trading on the NYSE are up today vs TSX are down? For example XEQT vs VT and TEC.TO vs IXN Arnt they essentially the same or similar, only one is trading in usd and the other in cad?

suspiciousswimming8

man if only i left that VOO/VT and chill shit last year. actual head in the sand

gtd_rad

Hey guys, I'm looking for long term holds but with a bit more risk tolerance and was wondering if there are leveraged ETFS on world diversification stocks like VT / XEQT. Similar to TQQQ / SPMO, are there similar ETFS that leverage VT or XEQT?

One_Talk_3410

Strategically going all in on VT. Did this numerous times recently and made good money. If it goes further down I’m comfortable owning it since it’s fully diversified 

TempeGrumble

OMG another fancy term for trying to market-time. Warning: I'm a Boglehead, so I'm going to be one of the folks advising you and your spouse to focus on low-cost, broad market index funds for equities and avoid trying to guess where and when "the market" is going anywhere. In this perspective, your advisor was wrong, and going with something broad-based within your asset allocation is correct. E.g., with Vanguard ETFs, VT (or VTI and VXUS) for equities, and something like BND for bonds.

Sagelllini

[I wrote this](https://www.reddit.com/r/Bogleheads/comments/1pdlssz/the_latest_morningstar_report_shows_how_to_invest/?utm_source=share&utm_medium=mweb3x&utm_name=mweb3xcss&utm_term=1&utm_content=share_button) on how to invest and [this](https://www.reddit.com/r/Bogleheads/comments/1svxbkk/honoring_jonathon_clements_the_stocks_and_cash/?utm_source=share&utm_medium=mweb3x&utm_name=mweb3xcss&utm_term=1&utm_content=share_button) on funding a retirement. The idea that "sector rotation" works is disproven by the Morningstar numbers because active strategies consistently lag passive investing. As to the corporate bonds, the coupon rates are pretty much irrelevant because the price is marked to Market so the higher price coupons are priced higher and the lower coupons lower. Regardless, you should sell them all. Look again at the Morningstar numbers. Do you want corporate bonds with returns in the mid-5s or stocks that historically do 10%? Personally, for the inherited IRA I would sell everything that is in there, buy VTI and VXUS in some ratio (mine is 80/20) and figure out the most tax efficient method to withdraw over the next 6 years (and a FA won't know the most tax efficient way). Then, you systematically sell, pay the tax you owe, and buy VTI and VXUS in whatever ratio you choose in a taxable brokerage account with the proceeds after paying the tax.That will most likely get you the best returns over the upcoming years. Fire your manager, sell the crap in tax deferred accounts, buy VTI and VXUS (or VT) and if nothing else you'll save yourself fees and aggravation.

brock2063

VT and chill buds

Vlookup_reddit

isn't there a bubble every year since 2021? like at some point just DCA and VT and chill.

Banana_rocket_time

This… 75-90% of all investable cash into vti or voo or VT Then a small portion of investable cash (5-10%) can go toward some high risk stuff or more volatile ETFs like space or semi conductor or long term individual stock holds.

Ahamadrayasbaboon

I sell a surprising amount of broad market LEAP puts, significantly OTM, like measured in SD. On ETFs that have shown in history to have better upside capture and less downside capture than SPY or VT. I sometimes wonder if my counterparties are mentally ill. 

hugh2018

Beating the S&P and safe investments are not compatible goals. If you can recalibrate your expectations and accept the very decent long term, inflation beating returns of the total stock market, VT is a great option (or whatever equivalent is available in your country). Yes VOO works out too long term, but if you study the history of the market, you’ll understand that international does occasionally outperform the US over significant periods (like the lost decade), and having exposure to both is a decent hedge against that back and forth.

badfirstimpression1

Build a hefty 80-90% VT/VOO base and buy stocks with the rest- for me I'm in RKLB, ONDS, and DNN. Use a ROTH IRA if you can as you can rebalsnce within it tax-free.

Ancient-Swordfish292

You can get rich with VT. VT + chill + high savings rate + time.

Ancient-Swordfish292

VT and chill.

Emotional-Power-7242

Not being in the EU actually makes it easier because you can buy US-domiciled funds such as VOO, VXUS, VT, etc. EU investors can't buy these funds and instead have to buy EU-regulated funds (usually domiciled in Ireland). A quick search shows that Serbia has some regulation on transfers to brokerages, that they must come from a local bank. You'd have to ask a Serbian source about that idk. You may also have some Serbian tax advantaged accounts we wouldn't know about (401k equivalent or whatever).

brock2063

So you're buying VT?

Adventurous_Elk_4039

How do you miss out? The US is still like 60% of VT. And portfolio size doesn’t matter when speaking of equities.

xjcln

I thought you were going with only single stocks and not fund tickers... if you're including funds is this even an experiment? A lot of people's entire retirement plans are VT or VTI. Personally I'd just go VT for maximal diversification.

Adventurous_Elk_4039

VT.  Every stock in the world at market weight. You don’t have to worry about picking winners or if this sector or that sector crashes, you will simply BE the market and rise along with it. No rebalancing or adjustments needed.

outsidetheeggshell

VT is the only right answer

Far-Doctor3527

TLDR: VT and chill Hello, responding here because I am also unhappy that my passive funds will buy SpaceX. I have decided to not take any action regarding the SpaceX IPO, and accepting that my funds will buy it even though this IPO seems like an obvious grift. I am not trying to convince you to take action or not take action, just explaining my reasoning because this IPO has made me worry about my portfolio and maybe this will be helpful to you in your own decision. First let's understand what types of funds could be affected by the IPO: \- Total world market funds (VT and the like). These track the total world's equities market, which is roughly $154 trillion in market cap. \- Total US market funds (FSKAX, FZEROX, VTI, VTSAX, and the like). These track the total US equities market, which is roughly $77 trillion in market cap. \- S&P 500 funds (FXAIX, VOO, and the like). These track the largest 500 companies in the US by market cap, which total to about $62 trillion. Note that this is about 80% of the total market. \- S&P 100 funds / Mega cap funds (FGRTX, QQQ, and the like). These track roughly the top 100 companies in the US, totaling roughly $55 trillion. Note that this is roughly 70% of the total market, and roughly 89% of the S&P 500 \- Large cap funds (FNILX, FSPGX, and the like). These are functionally equivalent to the S&P 500 so I will not add anything here, they may be slightly larger or smaller percent of the total market than the S&P 500 depending on holdings. \- Mid cap, small cap, and international funds: unaffected The first thing you want to think about is: what are you invested in? You don't have to go super granular but most passive investors have their investments in some version of the above funds. Are you more of a total market person, or more S&P 100? It doesn't matter which one you are, but take a look at your portfolio and understand what you are invested in. Now let's assume SpaceX does IPO at $2 trillion and let's look at how the SpaceX IPO affects the broad categories: \- Total World Market Funds: 2 / 154 = 1.2% of the total world market \- Total US Market Funds: 2 / 77 = 2.6% of the total US market \- S&P 500 and other large caps: 2 / 62 = 3.2% of the S&P 500 \- S&P 100 and other mega caps: 2 / 55 = 3.6% of the S&P 100 Now let's assume that the worst case happens: SpaceX IPOs at 2 trillion, and then the price goes literally to 0. If you are mostly in total market funds, your portfolio would go down by 2.6%. If you are mostly in large cap funds, your portfolio would go down by 3.2%. If you are mostly in mega caps, your portfolio would go down by 3.6%. But let's be realistic, even with this IPO likely being an Elon grift, do we really think this is going to 0? I don't. Maybe it loses 50% of its price, maybe 80%, I don't know. But it's a real company with real revenue (though small revenue compared to its huge valuation), so it's not going to 0. I'm not going to redo all the calcs but just for example, assuming it goes down by 50% and you are mostly in S&P 500 funds, your portfolio would go down by 1.6%. But here is the biggest consideration: 100% of SpaceX is not going to be publicly tradable. We don't know exactly what the percent it is going to be but likely only like 5%. This means that the indexes will only track 5% of SpaceX's market cap. So assuming SpaceX IPOs at 2 trillion and goes down by 50% and you are mostly in S&P 500 funds, your portfolio would go down by (2 \* .05)/62 = .16%. To be clear, this is like a fifth of a percent, which is inconsequential, the market moves more than this on a daily basis. Another point: I don't know what is going to happen in the future: I don't know if SpaceX's price will actually shoot up for whatever reason, so as an uninformed person, I think actively shorting SpaceX is not a good idea. Remember the famous quote "the market can remain irrational longer than you can remain solvent". I am a regular person and don't have any privileged information about what is going on with SpaceX so I think shorting it would be equally risky to shorting any other company that doesn't have a high-profile controversial figurehead as Elon Musk, which is something I wouldn't do (and likely something other passive investors wouldn't do either). At the end of the day, passive investors get to benefit from all of the companies in the market without having to do the work of researching and understanding each business, and making bets about which one will go up or down. We have benefitted from all the other great businesses that have continued to skyrocket without having to use a second of time to evaluate them. If you want to take action against the SpaceX IPO that is totally ok, but you could be introducing complexity to your portfolio, and spending your valuable time thinking about how to hedge against something that will impact your portfolio less than regular daily market fluctuations. Again, not trying to convince you one way or another, and to reiterate, I am not happy that I will be buying into this IPO passively because I do think it is a grift, but by looking at the actual numbers I have decided that this is not consequential. So to summarize all of this information, even though I am more of a Fidelity stan than Vanguard, "VT and chill".

StegersaurusMark

While your advice is correct, you blatantly ignored the (nice and brief) question that OP explicitly asked. I will rephrase the question “what is the most aggressive investment strategy and what are its expected returns over 20 years if I leave this money untouched” That is a completely orthogonal question to your answer of “keep DCAing for the next 20 years” The expected returns question itself requires volumes of text and is essentially the foundation of financial planning and portfolio management. Or you can be snide and talk about crystal balls. Or you can just say VOO/VT/VBAL and chill and be pretty damn accurate

Foreign-Struggle1723

Depends on how you look at it. You might have to crunch the numbers, but over the last 10 years, VOO has handily outperformed a total world fund like VT. That's because the US has been kicking ass for more than a decade. Even Warren Buffett recommended in his will that his wife's trust be put into a low-cost S&P 500 fund—specifically a 90% S&P 500 and 10% short-term bond split. Another point to consider is that S&P 500 companies do massive business internationally, so you already get plenty of global exposure. But VT is still a safe, conservative bet if you just want a global 'set-it-and-forget-it' portfolio.