Low Cost Index Funds vs. Active Management?

What Are You Doing with Your Money?

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#1
n_huffhines

n_huffhines

I want for you what you want for immigrants
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#1
Just curious what the investors on VN are doing with their money.
 
#2
#2
n_huffhines said:
Just curious what the investors on VN are doing with their money.
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Vast majority is actively managed, but not by me. They invest it in a wide array of individual stocks. I have a little in index funds that I bought.

The reason that I have an advisor is that it is easier for them to manage cutting me a monthly paycheck now that I am retired. Also, they are able to manage the account better for tax implications than I can.

When I was saving for retirement I mostly invested in a few individual stocks (probably not smart, but turned out well) and index funds. If you want fund suggestions, feel free to ask.
 
#3
#3
1972 Grad said:
Vast majority is actively managed, but not by me. They invest it in a wide array of individual stocks. I have a little in index funds that I bought.

The reason that I have an advisor is that it is easier for them to manage cutting me a monthly paycheck now that I am retired. Also, they are able to manage the account better for tax implications than I can.

When I was saving for retirement I mostly invested in a few individual stocks (probably not smart, but turned out well) and index funds. If you want fund suggestions, feel free to ask.
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Yeah, what funds do you like?
 
#5
#5
This would be a good thread to post this in:

Who can suggest an S&P Fund with lower fees than Vanguard?

Their basic index fund is .14% and their admiral shares is .04%
 
#7
#7
Vol8188 said:
This would be a good thread to post this in:

Who can suggest an S&P Fund with lower fees than Vanguard?

Their basic index fund is .14% and their admiral shares is .04%
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That would be Schwab (SWPPX) at .03%, and you don't have to invest the bigger bucks of the Admiral shares.
 
#11
#11
n_huffhines said:
36
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I would think that you need to be 85-90% in stocks. If you want to add some bonds to the mix to reduce the volatility, you could do 10-15% bonds.

You could do 85-90% in VFIAX (Vang S&P 500). I don't remember if that is the Admiral shares version symbol or the other one. Vanguard's Admiral Shares charge a lesser percentage, but require a bigger investment. I think the Admiral version minimum is $10,000, versus $3,000 for the standard version. You could put the other 10-15% in Vanguard's Total Bond VBTLX. Returns are low, but it may make you feel not quite as bad when the other goes down the tubes, which it will at some point.

Schwab has an S&P 500 fund SWPPX, which charges a lower percentage than Vanguard's S&P with smaller investments. Also, Vanguard's Total Stock Market (VTSAX) provides about the same historical returns as their S&P 500 fund. Either would be fine.


Some other Vanguard funds which have done well over the long haul (with some volatility) are Small Cap Explorer (VEXPX), Mid Cap Strategic Equity (VSEQX), and Large Cap Morgan Growth (VMRGX).
 
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#12
#12
1972 Grad said:
That would be Schwab (SWPPX) at .03%, and you don't have to invest the bigger bucks of the Admiral shares.
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Impressive. Thanks for the advice. Don’t have the time to research individual stocks currently so I’ve been wanting to find the right index fund
 
#13
#13
Huff, another question that I meant to ask was if you wanted to invest in stocks other than U.S. You could add some portion to developed markets and/or emerging markets. Vanguard has funds for both, which will get you some exposure to the U.K., Germany, Japan, China, India, Brazil, etc. I have some exposure....maybe 6-7%. I'm afraid to do a lot.
 
#14
#14
Vol8188 said:
Impressive. Thanks for the advice. Don’t have the time to research individual stocks currently so I’ve been wanting to find the right index fund
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Sure. I'm not really an ass. I just play one on here sometimes for entertainment purposes only.
 
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#15
#15
If you're serious about investing on your own, take some time out and browse BogleHeads forums. 1972 knows what he's talking about here, but in general it will provide some more diverse advice.
 
#16
#16
Also, unless you're a real heavy hitter I doubt your active management is as active as you'd hope.
 
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#17
#17
Nobody will beat the Vanguard S&P 500 index fund over 30 years. Make it simple and put all of your money in that until you get close to retirement and then move some money into fixed income.
 
#19
#19
On 11/13/2000, Vanguard started 7 new funds. In order of returns since inception, over the last 17 years and 4 months:

1) VSMAX Small Cap Index 9.23%
2) VEXAX Extended Market Index 8.16%
3) VTSAX Total Stock Market 6.71%
4) VVIAX Value Index 6.61%
5) VBIAX Balanced 60/40 stock 6.22%
6) VFIAX S&P 500 Fund 6.17%
7) VIGAX Growth Index 6.07%

These funds have all been in existence for the same amount of time, and have gone through both good and bad markets. That doesn't mean they will react the same in the future.
 
#22
#22
1972 Grad said:
Still better than the vast majority of stock pickers.
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I agree, and I value your opinion more than most in the stock threads. The average investor is best to diversify via the John Bogle model. However, there are opportunities for better returns with disciplined trading and investing, and TGO is on point. The beauty of the market is that opportunities and investors change over time. Buffett used to buy fair companies at good prices. He shifted philosophy to buying good companies at fair prices. Personally, I enjoy trading individual stocks, and it has yielded a return that I am satisfied with. As I get older, I am starting to look for other investment strategies.
 
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#23
#23
Have a goali, stick to your goal, invest for the long term month after month and become wealthy
 
#24
#24
This might be a stupid question, but all the investing I've done has been through employer provided 401K's and now I'm going to be self-employed and going through a Roth IRA....

With the VSMAX Small Cap Index I'm seeing the minimum investment is $3k, but that's just to get in, right? Once I'm in, I don't have to come up with $3K every time I add to the fund, I can add $500/month or whatever, right?
 
#25
#25
n_huffhines said:
This might be a stupid question, but all the investing I've done has been through employer provided 401K's and now I'm going to be self-employed and going through a Roth IRA....

With the VSMAX Small Cap Index I'm seeing the minimum investment is $3k, but that's just to get in, right? Once I'm in, I don't have to come up with $3K every time I add to the fund, I can add $500/month or whatever, right?
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It's not a stupid question.

That's how I've always seen them set up. There's possibly not even a minimum deposit amount after the initial amount. IRAs often have lower minimums.
 
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