Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
International or Emerging market
Old 08-14-2006, 08:26 PM   #1
Full time employment: Posting here.
Arif's Avatar
 
Join Date: Jun 2005
Posts: 761
International or Emerging market

Recently looked at my asset allocation minus RE holdings and realized that I don't have any international or em investments inside my portfolio. The ETF or fund will be held in my ROTH and won't be touched for about 20 years so I'm not concerned with the recent run up over the years or the decline a few months ago. I'm primarily looking to balance my portfolio. Any have a recommendation on both EM and international ETFs that I should use to fill this void?
__________________

__________________
You take the blue pill - the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill - you stay in Wonderland and I show you how deep the rabbit-hole goes.
Arif is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Re: International or Emerging market
Old 08-14-2006, 08:31 PM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jun 2005
Posts: 8,616
Re: International or Emerging market

I use several international funds, but one I like best is DODFX. I also own EEM.
DODFX has been relatively tax efficient, so good for outside a Roth. Maybe PID inside a Roth?
__________________

__________________
LOL! is offline   Reply With Quote
Re: International or Emerging market
Old 08-14-2006, 08:51 PM   #3
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Ed_The_Gypsy's Avatar
 
Join Date: Dec 2004
Location: the City of Subdued Excitement
Posts: 5,292
Re: International or Emerging market

I got tired of fiddlling with many funds and bought VGTSX, Vanguard's Total International Stock Market Index. It tracks a composite of the MSCI Europe Index, the MSCI Pacific Index, and the Select Emerging Markets Index. I have MACSX, Matthews Asian G&I Fund, to play on China's growth. Since Japan is recovering, I don't shun it anymore, and I found that my emerging market fund was tracking energy, which I already have. So, will try this for a few years.

I am getting closer to set-it-and-forget-it.

Ed
__________________
my bumpersticker:
"I am not in a hurry.
I am retired.
And I don't care how big your truck is."
Ed_The_Gypsy is offline   Reply With Quote
Re: International or Emerging market
Old 08-14-2006, 09:00 PM   #4
Thinks s/he gets paid by the post
Spanky's Avatar
 
Join Date: Dec 2004
Location: Minneapolis
Posts: 4,046
Re: International or Emerging market

Vanguard Total International
__________________
May we live in peace and harmony and be free from all human sufferings.
Spanky is offline   Reply With Quote
Re: International or Emerging market
Old 08-14-2006, 09:30 PM   #5
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
HFWR's Avatar
 
Join Date: May 2005
Location: Lawn chair in Texas
Posts: 12,964
Re: International or Emerging market

In my case, VWO. Cheaper than VEIEX, and I lump-summed in.
__________________
Have Funds, Will Retire

...not doing anything of true substance...
HFWR is offline   Reply With Quote
Re: International or Emerging market
Old 08-14-2006, 09:49 PM   #6
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,074
Re: International or Emerging market

Quote:
Originally Posted by LOL!
I use several international funds, but one I like best is DODFX. I also own EEM.
DODFX has been relatively tax efficient, so good for outside a Roth. Maybe PID inside a Roth?
I also like DODFX...and so do a lot of other investors:

"A whopping $6 billion has flowed into the Dodge & Cox International Stock fund —— in 2006. That's the fourth-largest gain among all funds, according to FRC. Like most international funds, this fund, which is up 30.55% annualized over the last three years, has benefited from weakness in the U.S. dollar and strong economies abroad.

The fund uses a variety of metrics to build a broad portfolio of "temporarily undervalued" foreign stocks with growth potential. Turnover is an exceptionally low 7%, which should assuage the fears of investors who still think foreign markets are for gamblers only. That said, the fund is not immune to dips. Like most of its peers, the fund lost ground in the spring and early summer, losing about 5% from May through July. And about 15% of assets are invested in emerging-markets equities, about three times the average international fund's stake in that ever-volatile segment of the market."


http://www.smartmoney.com/fundscreen...story=20060804

__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 07:54 AM   #7
Full time employment: Posting here.
Arif's Avatar
 
Join Date: Jun 2005
Posts: 761
Re: International or Emerging market

Thanks all. I think I am going to go with DODFX. They offer a meaningful amount of emerging market and international stocks in one complete package. BTW- This is the first mutual fund I've owned in 13 years. I've been investing in individual stock screens with good success but without an international allocation. I'll build on this position until it becomes a meaningful (15-20%) percentage of my portfolio.
__________________
You take the blue pill - the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill - you stay in Wonderland and I show you how deep the rabbit-hole goes.
Arif is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 09:06 AM   #8
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Re: International or Emerging market

Hmmm, allow me to issue a dissenting view. Dodge & Cox is a shop I greatly respect, but they look an awful lot like they may have a serious asset bloat problem. I would probably choose an ETF or VAnguard offering instead.
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 11:48 AM   #9
Full time employment: Posting here.
Arif's Avatar
 
Join Date: Jun 2005
Posts: 761
Re: International or Emerging market

Brewer,
Are there any ETFs that contain a sizable chuck of EM along with international exposure?
__________________
You take the blue pill - the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill - you stay in Wonderland and I show you how deep the rabbit-hole goes.
Arif is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 11:50 AM   #10
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Re: International or Emerging market

Quote:
Originally Posted by Arif
Brewer,
Are there any ETFs that contain a sizable chuck of EM along with international exposure?
Not that I am aware. You would have to roll your own with EFA and EEM, or similar. There is also the Vanguard total international fund, but you'd have to open an account there.
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 12:14 PM   #11
Moderator Emeritus
Nords's Avatar
 
Join Date: Dec 2002
Location: Oahu
Posts: 26,616
Re: International or Emerging market

Quote:
Originally Posted by Arif
Are there any ETFs that contain a sizable chuck of EM along with international exposure?
I'm not Brewer but I've spent a bit of time digging around for a Tweedy, Browne replacement. All the international mutual funds have "suffered" from serious runups and IMO they're all bloated. I notice that as they've quintupled in size that somehow they haven't gotten around to reducing their expense ratios, either...

Try PID for large-cap dividend payers. The theory is that the typical international lack of transparency is more than made up for by a company's ability to pay/raise dividends for long enough to have credibility with Mergent's international index. It's possible that one or two of the companies in their index are from emerging markets.

But I'm not sure that emerging markets are any better than hot growth stocks. Take a look at Bernstein's "Thick as a BRIC" article and see if it's worth chasing a tiny, illiquid market being chased by everyone else. (The Jethro Tull quotes from a neurosurgeon/economist like Bernstein? Priceless.) I think EEM could be of value if there's a severe outbreak of pandemic influenza or a currency devaluation, but otherwise it seems like more hot money to me.

But if you think emerging markets are worth it then try EEM... one commission, a low ETF expense ratio, and decades of dollar depreciation compounding.
__________________
*
*

The book written on E-R.org, "The Military Guide to Financial Independence and Retirement", on sale now! For more info see "About Me" in my profile.
I don't spend much time here anymore, so please send me a PM. Thanks.
Nords is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 12:18 PM   #12
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Re: International or Emerging market

FWIW< I have decided to forgo EM exposure for now. Like Nords says, too much hot money. I'll buy after the inevitable crash.
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 12:20 PM   #13
Full time employment: Posting here.
Arif's Avatar
 
Join Date: Jun 2005
Posts: 761
Re: International or Emerging market

Yeah I know EM has been hot latetly but I'm not chasing returns. Just looking to somewhat balance my asset allocation. Most folks would think I am crazy if they saw my AA.
So to be more balanced (and hopefully a consistent return) I am willing to jump in and take my lumps as they come assuming that in 20 years I will have done OK.

Edit: The positions I'm taking in EM and international are very small (combined 5% of port.) and I'll add to them later after I rebalance at the end of this year. Hopefully there'll be more buying oportunities.
__________________
You take the blue pill - the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill - you stay in Wonderland and I show you how deep the rabbit-hole goes.
Arif is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 12:22 PM   #14
Moderator Emeritus
Nords's Avatar
 
Join Date: Dec 2002
Location: Oahu
Posts: 26,616
Re: International or Emerging market

Quote:
Originally Posted by Arif
Yeah I know EM has been hot latetly but I'm not chasing returns. Just looking to somewhat balance my asset allocation. Most folks would think I am crazy if they saw my AA.
So to be more balanced (and hopefully a consistent return) I am willing to jump in and take my lumps as they come assuming that in 20 years I will have done OK.
If you're willing to wait for 20 years of returns, will it hurt too much to wait another 12 months for an entry point? Or to DCA into it?
__________________
*
*

The book written on E-R.org, "The Military Guide to Financial Independence and Retirement", on sale now! For more info see "About Me" in my profile.
I don't spend much time here anymore, so please send me a PM. Thanks.
Nords is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 12:25 PM   #15
Full time employment: Posting here.
Arif's Avatar
 
Join Date: Jun 2005
Posts: 761
Re: International or Emerging market

Quote:
Edit: The positions I'm taking in EM and international are very small (combined 5% of port.) and I'll add to them later after I rebalance at the end of this year. Hopefully there'll be more buying oportunities.
Quote:
If you're willing to wait for 20 years of returns, will it hurt too much to wait another 12 months for an entry point? Or to DCA into it?
You're right. I think DCA makes sense in this environment of asset bloat. See the edited post above.
__________________
You take the blue pill - the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill - you stay in Wonderland and I show you how deep the rabbit-hole goes.
Arif is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 12:57 PM   #16
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jun 2005
Posts: 8,616
Re: International or Emerging market

Quote:
Originally Posted by Arif
I've been investing in individual stock screens with good success but without an international allocation.
I'm surprised that you have not bought any foreign stocks then.* * Certainly there are ADRs that are easy to purchase.* Over the years, I have owned a few ADRs.* I currently own ING which has doubled in the last two years.* (I'm not recommending it at its current price.)

For large cap international, though I own DODFX, I think that ETFs are fine (EFA, EFV, EEM, EWJ).* For small cap international, I own MIDAX and FSCOX.* Many of the best small cap international funds are closed to new investors.
__________________
LOL! is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 01:24 PM   #17
Full time employment: Posting here.
 
Join Date: Feb 2004
Location: Okanagan Valley
Posts: 805
Re: International or Emerging market

I'd give it at least a year, perhaps more, to consider EM. You have to just take a look at the 90's experience to get a taste of a very large highs and very large lows. A financial crisis somewhere in Latin Ameria or SE Asia would provide an excellent entry point. Patience is key.
__________________
AltaRed is offline   Reply With Quote
Re: International or Emerging market
Old 08-15-2006, 04:32 PM   #18
Thinks s/he gets paid by the post
saluki9's Avatar
 
Join Date: Feb 2005
Posts: 2,032
Re: International or Emerging market



Considering the streaky nature of EM, I would suggest you keep it in a separate position from your basic international exposure. That way, when valuations get totally out of whack you can trim back your EM exposure without effecting your international core position

__________________
saluki9 is offline   Reply With Quote
Re: International or Emerging market
Old 08-16-2006, 10:26 AM   #19
Recycles dryer sheets
 
Join Date: Oct 2004
Posts: 183
Re: International or Emerging market

Vanguard international growth and international value, I know they are not index funds but they are vanguard with relatively low cost and I've been happy with them. They fit into my coffee house like port very well. I think/hope that their stock picking international funds may have some benefits. All the rest of my stock funds are vanguard index funds....Duane
__________________
Shredder is offline   Reply With Quote
Re: International or Emerging market
Old 08-16-2006, 02:08 PM   #20
Moderator Emeritus
Nords's Avatar
 
Join Date: Dec 2002
Location: Oahu
Posts: 26,616
Re: International or Emerging market

WisdomTree has been kicking around for a few months and has been mentioned on other threads, but they're just getting onto my radar screen.

One of their newer ETFs is the International Smallcap Dividend Fund (DLS). I haven't done my own due diligence yet but I'm intrigued just as I was by PID-- a combination of "transparency" implied by the ability to pay dividends, plus the possibility of a smallcap risk premium.

Of course there's also the near certainty of getting whipsawed by an "index" that's 25% industrials, 25% financials, and 17% consumer cyclicals. Not for the faint of volatility, although reinvesting dividends will be Siegel's own reward with compounding...
__________________

__________________
*
*

The book written on E-R.org, "The Military Guide to Financial Independence and Retirement", on sale now! For more info see "About Me" in my profile.
I don't spend much time here anymore, so please send me a PM. Thanks.
Nords is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
International investing-- a year later Nords FIRE and Money 57 04-29-2007 01:03 PM
Market Efficiency Q devo FIRE and Money 17 12-17-2006 12:51 PM
High Yield Bond Market ats5g FIRE and Money 23 11-11-2006 04:24 PM
My favorite market timing metric wabmester FIRE and Money 15 05-07-2006 11:46 AM
Money market in 401K Bill FIRE and Money 2 05-31-2003 08:15 AM

 

 
All times are GMT -6. The time now is 08:10 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.