Wanting some feedback about Asset Allocation

[LOL!]

Better to have your brokerage text you when something hits a theoretical stop loss target and then assess the situation.

I agree. One can get "alerts" texted or e-mailed from their broker, so price alerts can be seen almost instantly.

 

[Scuba]

I am not sure where you got your Tax Cost Ratio, but if from Morningstar.com, the numbers are incorrect for many investors because the assumptions that morningstar.com makes do not apply to those investors.

But your point is well-taken: Some index funds are more tax-efficient than others even if they follow the exact same index.

For those that want a more detailed analysis for their own personal tax situation, please see: https://www.bogleheads.org/forum/viewtopic.php?t=208818

And some folks would rather use a Fidelity fund even if it cost them 0.05% more in taxes on the value of their holding.

All I know is that both my MIL & I were hit with significant tax consequences when we owned several MF's. The problem went away when we switched to similar ETF's. Perhaps there are ways to avoid this by researching tax efficient MF's but just sticking with ETF's has resolved it for us.

 

[Scuba]

I hope this doesn't sound incredibly stupid but I've always been of the opinion that investing in the stock market is like controlled gambling. You pick investments that have a proven track record, invest money you don't need atm and hang in there. It's been my experience that my attempts at timing the market end in failure. My choices have always been based on long term results.
This investment I'm talking about in my first post will be a long term goal. I simply want to maximize my chances for the greatest gains during the 15 year cooking period and then turn conservative for the next 5 years. This is money that will not be needed until then. I have fixed income from secure sources that meet all my spending needs.

If I wanted to maximize returns on long term money and was confident I wouldn't touch it for at least 15 years, I'd go 80-100% equities. Picking a broad index fund or target date fund with an aggressive AA would be a good way to go IMO.

 

[Chuckanut]

This is a very interesting discussion, but I get the impression the OP wants to keep things simple. So, if I were him I would invest in something like the Vanguard Total Market of USA funds. That would be highly weighted in large cap stocks he likes and still give some exposure to mid and small cap. And, I think, he would sleep well at night, and not be tempted to panic [-]if[/-] when the market has a significant correction

 

[LOL!]

All I know is that both my MIL & I were hit with significant tax consequences when we owned several MF's. The problem went away when we switched to similar ETF's. Perhaps there are ways to avoid this by researching tax efficient MF's but just sticking with ETF's has resolved it for us.

Give us the ticker symbols of the MF's and ETF's and we can do a post-mortem analysis for you.

BTW, I love ETFs and use them for most of our portfolio. OTOH, mutual funds have some advantages for me as well and I use them as appropriate. I have one single mutual fund left in a taxable account -- the others are in tax-advantaged accounts.

 

[Scuba]

Give us the ticker symbols of the MF's and ETF's and we can do a post-mortem analysis for you.

BTW, I love ETFs and use them for most of our portfolio. OTOH, mutual funds have some advantages for me as well and I use them as appropriate. I have one single mutual fund left in a taxable account -- the others are in tax-advantaged accounts.

Thanks for the offer but that would require a fair bit of work on my part to dig through old records and find fund tickers that we previously held. We've been really happy with the ETF's and tax consequences have been minimal compared to the MF's so our own experience is good enough analysis for me.

 

[MrBig1]

If I wanted to maximize returns on long term money and was confident I wouldn't touch it for at least 15 years, I'd go 80-100% equities. Picking a broad index fund or target date fund with an aggressive AA would be a good way to go IMO.

Thanks Scuba. That's exactly the kind of feedback that I was requesting. Information both supportive and cautionary is what I need. As I stated, I don't feel that I'm as experienced or as informed as many of the folks here. The informational discussion being carried on here about the tax differences between MF and ETF's is great stuff. I didn't know that ETF's existed. Will be digging up information about them and learning. Thanks guys/gals for your time.
BTW, I don't panic with market corrections. During the 2009 crash I did move my money to bonds at 11000 and then back into stocks at 9000. It wasn't panic it just seemed like I needed to try something. Pay checks got thin during the crash so I did stop my contributions. This is my only investing regret. What an opportunity that was to buy really cheap.

 

[MrBig1]

OP,
Expense ratios (fees) are a big factor in selecting funds. An index fund that charges 0.5% is 10x more expensive than one that charges 0.05%. This is galling and a terrible deal if they are following the same index. And with compounding interest, this makes quite a difference over 15 years.

Thanks again for more teaching cooch96. I didn't have many investment choices available in the past. This thread is giving me a lot of desire to learn more about various options available to me now.

 

[Scuba]

Thanks Scuba. That's exactly the kind of feedback that I was requesting. Information both supportive and cautionary is what I need. As I stated, I don't feel that I'm as experienced or as informed as many of the folks here. The informational discussion being carried on here about the tax differences between MF and ETF's is great stuff. I didn't know that ETF's existed. Will be digging up information about them and learning. Thanks guys/gals for your time.

BTW, I don't panic with market corrections. During the 2009 crash I did move my money to bonds at 11000 and then back into stocks at 9000. It wasn't panic it just seemed like I needed to try something. Pay checks got thin during the crash so I did stop my contributions. This is my only investing regret. What an opportunity that was to buy really cheap.

This site is a great way to learn. Good luck! One other suggestion - my personal preference is index ETF's rather than funds - keeps costs including taxes low.