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10-12-2008, 08:12 PM
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#1
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Recycles dryer sheets
Join Date: Oct 2007
Posts: 332
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Lazy Portfolios
Just wondering if anyone uses these "Lazy Portfolios" and if so, any comments. Even comments on anyone thinking about redoing there portfolio along these lines.
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10-18-2008, 10:52 AM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2004
Location: the City of Subdued Excitement
Posts: 5,588
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cash,
Your link is messed up. Please try again.
Are you thinking of the Couch Potato portfolios or something similar?
__________________
I have outlived most of the people I don't like and I am working on the rest.
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10-18-2008, 12:07 PM
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#3
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Thinks s/he gets paid by the post
Join Date: Sep 2008
Posts: 2,171
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Quote:
Originally Posted by cashflo2u2
Just wondering if anyone uses these "Lazy Portfolios" and if so, any comments. Even comments on anyone thinking about redoing there portfolio along these lines.
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You mean these?
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10-18-2008, 03:18 PM
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#4
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Recycles dryer sheets
Join Date: Oct 2007
Posts: 133
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10-19-2008, 10:19 AM
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#5
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Recycles dryer sheets
Join Date: Nov 2005
Posts: 337
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Margaritaville is the one I have recommend to nieces and nephews. Though now I recommend 2/3 Vanguard's total world market index and 1/3 the TIPS fund.
Margaritaville guides my own portfolio, but I never manage to keep it that simple. For fixed income, I use a TIPS ladder, MM and short-term bond funds instead of just the TIPS fund. On the equity side, I have a mix of index funds with more of a small tilt in the US, more of an emerging/pacific tilt internationally, and a number of legacy individual stocks with unrealized capital gains I don't want to realize yet.
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10-19-2008, 10:29 AM
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#6
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Thinks s/he gets paid by the post
Join Date: Mar 2006
Location: Houston
Posts: 4,337
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I refuse to buy a bond mutual fund so I have the fun of picking CDs for my ladder. I want to know how much I'll have available and when. I don't want my principle to be subject to interest rate risk. I want to know that one June 15, 2011 I'll have $30,000 show up in my account.
As for the equity portion, it is almost all in just a couple index funds.
__________________
The object of life is not to be on the side of the majority, but to escape finding oneself in the ranks of the insane -- Marcus Aurelius
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10-19-2008, 10:42 AM
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#7
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2004
Location: the City of Subdued Excitement
Posts: 5,588
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I have been trying to keep my equities 50/50 US/International, but I have added a TIPs fund, foreign bond fund and am now building a 5-year CD ladder in anticipation of retirement, so it is drifting towards the Margaritaville model. My instructions to my wife in case I peg out first include converting the entire portfolio to Margaritaville for simplicity.
I have not been a big fan of bond funds but have been persuaded to include them. It seems to have been a good thing to do. (Old Dutch saying: "We grow too soon old and too late smart.")
__________________
I have outlived most of the people I don't like and I am working on the rest.
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10-19-2008, 07:02 PM
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#8
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Recycles dryer sheets
Join Date: Oct 2007
Posts: 332
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Sorry, that link did not work. But it seems everybody figured out what portfolios I was trying to get to. I guess they are not all that popular. I'm looking for a cookie cutter portfolio that will do me right for the duration without a lot of worrying.
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10-19-2008, 07:52 PM
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#9
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Recycles dryer sheets
Join Date: Oct 2007
Posts: 332
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They like to show how well these have held up in the down market, but have they done any back testing in a bull market?
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10-20-2008, 09:12 AM
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#10
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Recycles dryer sheets
Join Date: Nov 2005
Posts: 337
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Quote:
Originally Posted by cashflo2u2
Sorry, that link did not work. But it seems everybody figured out what portfolios I was trying to get to. I guess they are not all that popular. I'm looking for a cookie cutter portfolio that will do me right for the duration without a lot of worrying.
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I think you will find the individuals who post regularly to the "FIRE and Money" forum are generally self-selected invest-it-yourself tinkerers. Most of us are constantly studying and talking about improving our investing, because we enjoy doing so. We almost all save a lot on portfolio management fees, and we almost all make investing much more complex than it needs to be.
Imagine a forum for people who rebuild old cars in their garages, to which you post the question: "Should I go to the dealer or to Jiffy Lube to have the oil changed in my brand new car?" Most of the responses would probably be: "Well, I would just change it myself, but I send my MIL/daughter/cousin to ____."
If you want set it and forget it, your basic choices are hire someone, though that can easily cost you 25% of your safe withdrawal annually, or use some variant of the lazy automated portfolios. Personally, if I had just been told I had a brain disorder, and would soon be unable to manage my portfolio, I would put:
- 64% in Vanguard Total World Stock Index (VTWSX)
- 32% in Vanguard Inflation Protected Securities (VIPSX)
- 4% in a Vanguard money market fund
I would tell my wife that whenever the money market fund ran low, she should transfer money from either VTWSX or VIPSX trying to always move the portfolio towards 2 parts VTWSX to 1 part VIPSX. I would also tell her that once a year she should calculate 4% of the portfolio, and compare it with last years 4%. Each year she should not spend more than the greater of the two numbers, and never more than 8% of the current portfolio until she was in a nursing home. Lastly, I would tell her to otherwise just ignore the portfolio regardless of what was in the news, and where anyone told her to invest.
Obviously feel free to use Admiral funds if your portfolio size permits. A 1 part VTWSX to 1 part VIPSX variant is also very reasonable if you want to be more conservative. You can also pick some other lazy portfolio if you prefer.
If pressed, I might even admit that the simple portfolio I describe has a good chance of beating my actual portfolio's performance, and would definitely be less volatile than my actual portfolio. However, I expect to continue tinkering.
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10-20-2008, 12:35 PM
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#11
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Recycles dryer sheets
Join Date: Oct 2007
Posts: 332
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VTWSX seems kind of new to put all the equity funds into. I almost did with the new VG payout funds and I'm glad I didn't.
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10-20-2008, 01:39 PM
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#12
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Recycles dryer sheets
Join Date: Nov 2005
Posts: 337
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Quote:
Originally Posted by cashflo2u2
VTWSX seems kind of new to put all the equity funds into. I almost did with the new VG payout funds and I'm glad I didn't.
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Feel free to use:
- 1/3 VTSMX
- 1/3 VGTSX
- 1/3 VIPSX
if that makes you more comfortable. Because VTWSX is a Vanguard index fund, I don't worry about its youth the way I would with a managed fund or a smaller fund company.
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10-20-2008, 06:01 PM
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#13
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Full time employment: Posting here.
Join Date: Jan 2006
Location: Boston
Posts: 620
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Quote:
Originally Posted by bamsphd
Personally, if I had just been told I had a brain disorder ...
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One of my last sane acts was to realize I had just such a disorder, when I found Enron in my portfolio circa late 2001.
Since then, I've reformed my ways and become a set-it-and-forget-it kind of guy.
Sing it with me ...
"Lazy.
I just want to be lazy.
How I long to be out, in the sun, with no work to be done ... "
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10-21-2008, 05:06 AM
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#14
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Thinks s/he gets paid by the post
Join Date: Feb 2008
Posts: 1,281
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Quote:
Originally Posted by tgotch
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Interesting - "Ultimate Buy & Hold" portfolio did the best of these over the past 1, 3, & 5 years (+3.99 over 5 years)
32% intermediate & short term Treasuries & 8% VIPSX - seems that 40% really helped shelter it from the storm.
Anybody doing that one?
__________________
Retired 2009!
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10-22-2008, 03:11 AM
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#15
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Thinks s/he gets paid by the post
Join Date: Mar 2006
Location: Houston
Posts: 4,337
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Quote:
Originally Posted by Lusitan
One of my last sane acts was to realize I had just such a disorder, when I found Enron in my portfolio circa late 2001.
Since then, I've reformed my ways and become a set-it-and-forget-it kind of guy.
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Enron was my last individual stock buy. When they went into the first part of their death dive, I looked at their assets and figured that their pipelines and other hard assets would keep their breakup value above $15. I bought a bunch at $8. I never sold. I guess you could say I'm waiting for the rebound.
After that, I went from being about half indexer to 100% index. I still have a small amount of BAC that I haven't sold because of a large capital gain. It's still positive but I might move my after tax index funds around a little to capture the tax loss and cover the gain on my BAC.
__________________
The object of life is not to be on the side of the majority, but to escape finding oneself in the ranks of the insane -- Marcus Aurelius
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10-22-2008, 08:25 AM
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#16
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Recycles dryer sheets
Join Date: Oct 2007
Posts: 332
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I wonder if DVFAX, that is relatively new also, would be an excellent addition to portfolio at this point.
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01-03-2012, 07:11 AM
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#17
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Aug 2011
Location: West of the Mississippi
Posts: 17,173
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When I look at the Lazy Portfolios, some of them have so many funds in them, that they seem to be creating their own Total World Index Fund.
__________________
Comparison is the thief of joy
The worst decisions are usually made in times of anger and impatience.
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01-03-2012, 08:29 AM
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#18
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2008
Posts: 13,132
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Though my percentages are different. I'm closest to the Second Grader Starter portfolio.
__________________
Have you ever seen a headstone with these words
"If only I had spent more time at work" ... from "Busy Man" sung by Billy Ray Cyrus
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01-03-2012, 08:34 AM
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#19
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2008
Location: NC
Posts: 21,204
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I suspect many here have portfolios that resemble the lazy portfolios, with an eye on minimizing expenses and taxes. Mine is a subtle variation on William Bernstein's The Four Pillars or Investing, close to two shown by the link but not exactly the same as any. They all have their place, you may put your own spin on them (as I am sure we all do) but the lazy portfolios are fundamentally similar.
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57
Target AA: 50% equity funds / 45% bonds / 5% cash
Target WR: Approx 1.5% Approx 20% SI (secure income, SS only)
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01-03-2012, 08:42 AM
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#20
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2006
Location: Boise
Posts: 7,866
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As I've said here before, I am basically 100% VFIAX/VTSMX and have been so in my investments for years. I do have some cash in an emergency fund and the kids' college funds are a mixture of VxxxX and those target funds. I also have some private stock in a former employer, but will convert that to VxxxX as soon as they do their IPO (or delete it from Quicken and take the capital loss if they go bankrupt.)
No individual stocks, no options, no commodities, no actively managed mutual funds, no trading.
2Cor521
__________________
"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
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