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Old 02-03-2008, 03:13 PM   #21
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After allowing for some cash reserve, my portfolio is 50-50 equity/fixed.
Of the equity, 20% is in the Vanguard International Equity Index (that is, 10% of total portfolio.) I'm splitting the difference between those who say you should have lots of exposure to international equities and John Bogel who says that due to the amount of business S&P 500 companies do overseas, you have international exposure even if you stay "doomestic". I don't pretend to know the right answer, but during this 2008 downturn, international and domestic have not been as negatatively correlated as I might have liked.
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Old 02-03-2008, 03:21 PM   #22
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Thanks for everyone's feedback! It's been most helpful.

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Originally Posted by mb View Post
I have started looking at DLS and DGS for international small cap exposure but haven't bought any yet. Anyone have any opinions on them or other small cap international plays?
We have an IRA account with T. Rowe Price so I'm looking at TRP International Discovery (T. Rowe Price International Discovery Report (PRIDX) | Snapshot), but it's expense ratio hurts (1.24%). It is internat. small/mid cap growth (but more mid than small)
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less stuff, more time

(49, married; DH 53. I am fully retired as of 2015 (well ok, I still work part-time but only because I love the job and have complete freedom to call off if I want to travel with hubby for work), DH hopes to fully retire 2018 when he turns 55 to access 401K penalty-free...although he may decide to do part-time consulting)
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Old 02-03-2008, 03:38 PM   #23
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Thanks for everyone's feedback! It's been most helpful.



We have an IRA account with T. Rowe Price so I'm looking at TRP International Discovery (T. Rowe Price International Discovery Report (PRIDX) | Snapshot), but it's expense ratio hurts (1.24%). It is internat. small/mid cap growth (but more mid than small)
I like TRP and a good chunk of my non-indexed money is in TRP Small Cap Value and New Asia but I was trying to find something cheaper than International Discovery although for international small cap 1.24% really isn't that bad.

During the time that I have been following them the two exchange traded funds that I cited have had low volume and large spreads - so also expensive just in a different way.

MB
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Old 02-03-2008, 03:51 PM   #24
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About 10% of our portfolio is in DLS; a smaller chunk in DGS. So far we have only lost money. Bought DLS last June, sold all in August and bought GWX in a tax-loss-harvesting move. Sold all GWX in January and bought DLS.

We are probably down almost 20% in total on this stuff. We had more than doubled our money in small cap int'l in the previous 3 years in mutual funds with high expense ratios. I guess it's better to lose money in a low expense ratio place than in a high expense ratio place. At least the tax loss harvesting let us get out of the high e.r. fund without paying any taxes.

[edit] Daily trading volume in DLS and GWX is certainly reasonable nowadays. Bid/ask spread is around 10 cents. Certainly use limit orders and look at the NAV so that you are not paying too much relative to NAV.
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Old 02-03-2008, 04:05 PM   #25
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Just under 15% int'l. Of that, roughly 2/3 in Fidelity Int'l Discovery and 1/3 PID. Would like to add a small % to emerging markets when the time is appropriate.
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Old 02-03-2008, 04:26 PM   #26
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60% stocks with 50% of the stocks international (30% of overall portfolio). And US stocks are tilted towards large cap global companies. Also started buying global REIT (FIREX from Fidelity and looking at others).

I think these numbers are close - the US is:
5% of world's population, which has
15% of the world's consumption, which uses
20% of the world's energy, and the US market capitalization is
50% of global market capitalization

I do not see how this "extreme concentration of energy, consumption, and capitalization" can continue.

I just gotta believe that over the next 20 years the return on capital and equities internationally has to be higher than US.

And if the international returns are not greater, they'll be equal or close -- and hopefully "smooth out" returns overall.
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Old 02-03-2008, 05:13 PM   #27
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Currently 20.5% international in my 401(K)/TSP. I was MUCH higher % recently, but have now adjusted to my current allocation.
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Old 02-03-2008, 09:52 PM   #28
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And yes the Pats have a good football team.
Unfortunately tonight the Giants had a better one. So that means now that my hormones are all stirred up - maybe take another look at PID and things like that since I'm an old Mergent's Handbook buyer from when they only covered US dividend payers.

heh heh heh -
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Old 02-03-2008, 10:57 PM   #29
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24% international (18% VEU, 6% VWO).
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Old 02-04-2008, 02:42 AM   #30
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Think of what happened if you were Japanese and REed in 1990 with all of your assets in the Japanese market. Now think about how much better of you would be if you had half in non-Japanese equities. I think that case study alone is a sufficiently strong argument for international exposure.
I'm at about half domestic (Japan) and half foreign, for both stocks and bonds, for just that reason. I don't care whether domestic or foreign stocks/bonds/currencies do better -- I figure I should come out about the same either way.

Now watch the real action turn out to be in Barbie Dolls or something.
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Old 02-04-2008, 08:15 AM   #31
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About 85% "international" (i.e. non-US) and 15% US. Of that, about 75-25% equity vs fixed income/cash or cash equivalents.

Although proper "decoupling" of other economies from the US is largely a myth at this stage in my view, recovery and growth prospects in emerging markets seem more interesting, again in my view. The ride you get going down and back up is more severe, but the rewards seem to be infinitely more encouraging. It has taken some getting used to, but when a recovery does come about, the rewards tend to be remarkable.
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Old 02-04-2008, 09:26 AM   #32
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Fidelity Diversified International (FDIVX), 10 percent, plus whatever international might be part of other funds (large cap, small cap, etc.). Down 7.6 % since 1/1/2008, but still up 8.9 % since 2/2/07.

Why? Wanted to have a little riskier element in AA that wouldn't kill us if it went way down. Might get out of it when we retire.
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Old 02-04-2008, 10:27 AM   #33
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Roughly 40-50% of equity allocation is in non-US stocks.

Why? See:

The Long-Term Risks of Global Stock Markets

Global Stock Markets in the Twentieth Century

- Alec
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Old 02-04-2008, 10:38 AM   #34
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Please indicate whether the % is of your whole portfolio (i.e. cash, bond, stock) or is just of the stock portion.

We currently have ~15% international (of total portfolio). This includes total international and emerging markets funds.

We are thinking of increasing our exposure but would like to see other's reasons for either holding less or more.

Still actively contributing with retirement hopefully 5-10 years away(overall asset allocation 73% stock, 18% bond, 9% cash).

Thanks!!
25% foreign

Always allocate at least 15% of each account (401k, Roth, rollover) to foreign large cap.

10% can go to International small caps (Rollover and Roth), emerging markets (my 401k) or to foreign large caps (wife's 401k).

I choose not to invest in country sector funds. I prefer more diversified international holdings.

Anything more than 25%, IMO, is too much currency risk.

It should be noted that what is a large cap in many countries (maybe 500M or 1000M market cap) would be small cap or microcap in US. So not all large caps are created equal.
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Old 02-04-2008, 10:45 AM   #35
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My AA is 60/40 stocks/bonds, although right now I'm a little bit higher in bonds.

Current diversification is:
43.5% Bonds
30% Large US stocks
11.1% Mid/Small Stocks
15.4% International stocks (Including emerging markets)

Over the weekend, a local tv station had an hour feature program on the growing auto industry in China and India and how quickly they are gaining on the US/Asian/European mfgs. The big issue is still quality, but they are making significant improvements there and the expectation is that they will soon be a real threat, not only in that part of the world --an emormous market --but in the US as well. Also, I notice that recently two huge Indian-based firms acquired major interests in two local auto suppliers here in southeast Michigan. Maybe I'll take another look at the international/emerging markets when I do my portfolio rebalancing..............
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Old 02-04-2008, 12:09 PM   #36
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80/20 asset allocation between equities/bonds.

Of the equities, roughly 50% in international. Mostly based on my belief that the relative importance of the US economy will decline over my long-term investing horizon (I'm 33).
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Old 02-04-2008, 12:51 PM   #37
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15% for now, I was at 20% from 1999-2006........

I suppose I will always have 15% or so in international, I think our markets have a harder time moving upwards than smaller more "agile" economies........
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Old 02-05-2008, 07:51 AM   #38
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Vanguard used to recommend 20% of equity. Got their quarterly report in mail yesterday and it had their latest "position". Basically 20% is the floor and can be up to 50%. They recommend 20-40% to adequately get diversification benefits at lowest level and perhaps greater growth in the long run at higher levels; i.e., prospects for rest of the world having greater economic growth over US next few decades.

1) Since we are retired and somewhat conservative, and
2) since a high percentage of our US stock has a global footprint and can benefit from the global economy:

we're staying at allocation we've had for a long time, 20% stock allocation( 10% total portfolio).
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Old 02-05-2008, 07:57 AM   #39
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I think that it's important to point out that higher economic growth doesn't necessarily translate into higher returns to shareholders. The whole growth/value effect.

- Alec
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Old 02-05-2008, 08:03 AM   #40
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I'm at 10% and that's the amount I'm comfotable with .
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