Going all in for VTI??

Discussion of the Stock portion of the Permanent Portfolio

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fishdrzig
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Going all in for VTI??

Post by fishdrzig » Sat Apr 25, 2015 7:34 am

Alright, I expect to get chewed out here for not going all in 4x25 from the outset but I have all allocated except for VTI.  If you were in my shoes (and hopefully you are not) now, what would be your strategy for entry into VTI going forward??  Thanks for the responses.
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dualstow
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Re: Going all in for VTI??

Post by dualstow » Sat Apr 25, 2015 7:42 am

Are you saying you have your gold, cash and bonds and no stocks at the moment?
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ochotona
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Re: Going all in for VTI??

Post by ochotona » Sat Apr 25, 2015 8:06 am

You could divide up your buys into a bunch of different limit orders with different prices that you find acceptable, "good until cancelled", then forget about it. -5%, -10%, -15%, -20% from current levels, for example. They will execute automatically as those limits are hit.

I use different ETFs, but I have the equivalent of half VTI and half VT now.
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sophie
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Re: Going all in for VTI??

Post by sophie » Sat Apr 25, 2015 8:56 am

Every time I put in limit orders less than a buy price, the price of the asset takes off, and I'm left in the dust with my useless "good 'till cancelled" limit order feeling like I've missed out.  Even better, when I buy multiple assets at once (e.g. stocks + bond funds), the one that goes UP doesn't kick in, and the one going DOWN does.  Thus I've taken to placing market orders for ETFs.

If you have a lot of money and don't want to put it into the PP all at once, it's fine to divide it into aliquots and buy into all 4 assets at regular intervals, e.g. monthly.  That gets expensive with gold so you might want to buy that less often, e.g. every 3 months.

If your PP is currently unbalanced, though, I would buy your preferred stock investment right away, at least enough to get you to 15% stocks.  Otherwise, if stocks jump up, your gold and bonds can both drop and you will be a very unhappy camper.  An unbalanced PP is fairly risky because the assets were chosen to be highly volatile.  The package works together well, but only if you have enough of all components.
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Re: Going all in for VTI??

Post by ILoveMoney » Sat Apr 25, 2015 11:18 am

sophie wrote: If you have a lot of money and don't want to put it into the PP all at once, it's fine to divide it into aliquots and buy into all 4 assets at regular intervals, e.g. monthly.  That gets expensive with gold so you might want to buy that less often, e.g. every 3 months.
Could you explain why you would want to buy cash, stocks & bonds e.g. monthly and gold e.g. once every three months?

Don't follow your comment that dollar cost averaging gets expensive with gold or why you would delay buying that particular asset over the other three.
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ochotona
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Re: Going all in for VTI??

Post by ochotona » Sat Apr 25, 2015 11:31 am

sophie wrote: If you have a lot of money and don't want to put it into the PP all at once, it's fine to divide it into aliquots and buy into all 4 assets at regular intervals, e.g. monthly.

If your PP is currently unbalanced, though, I would buy your preferred stock investment right away, at least enough to get you to 15% stocks.  Otherwise, if stocks jump up, your gold and bonds can both drop and you will be a very unhappy camper.  An unbalanced PP is fairly risky because the assets were chosen to be highly volatile.  The package works together well, but only if you have enough of all components.
I agree... sometimes it just seems your limit prices and what reality dishes out are divergent. It's fine to divide money into lots, and start a regular buying program. At least you get an "average" price over an interval.
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Re: Going all in for VTI??

Post by fishdrzig » Sat Apr 25, 2015 12:50 pm

dualstow wrote: Are you saying you have your gold, cash and bonds and no stocks at the moment?
Yes
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dualstow
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Re: Going all in for VTI??

Post by dualstow » Sat Apr 25, 2015 1:00 pm

I was going to say something similar to one line from Sophie --> at least get your minimum 15% in ASAP. Even with this long bull run, you have to have some stocks. If you're under 40, I would consider getting 20%-25% very soon. If & when stocks plunge, you can handle it.
“As a white person of colour, I am extremely concerned about the rise of black whiteness.” — Titania McGrath
pariah — 1610s member of a low caste in S. India; Tamil (Dravidian) “drummer”, as members of the lowest caste played drums at festivals. “social outcast,” 1819.
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madbean
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Re: Going all in for VTI??

Post by madbean » Sat Apr 25, 2015 1:08 pm

Could have said the same thing about buying IAU at around $16 when I first jumped in. Some said gold was going to the moon and others said it was in a bubble and about to crash. In hindsight, it would have been better to have waited but my crystal ball was in the shop at the time.

The only HB radio show I ever listened to he was discussing this with someone having the same kind of misgivings only in his case it was bonds. As you can probably imagine, HB's advice was to just do it.

I still don't like seeing my IAU way down in the red but as long as I'm getting satisfactory returns on the overall portfolio it doesn't really matter.
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KevinW
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Re: Going all in for VTI??

Post by KevinW » Sat Apr 25, 2015 1:25 pm

My advice is to just go all-in, buy VTI, and move on. KISS.  :D
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ochotona
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Re: Going all in for VTI??

Post by ochotona » Sat Apr 25, 2015 1:53 pm

dualstow wrote: I was going to say something similar to one line from Sophie --> at least get your minimum 15% in ASAP. Even with this long bull run, you have to have some stocks. If you're under 40, I would consider getting 20%-25% very soon. If & when stocks plunge, you can handle it.
STRONGLY AGREED
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dualstow
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Re: Going all in for VTI??

Post by dualstow » Sat Apr 25, 2015 3:11 pm

KevinW wrote: My advice is to just go all-in, buy VTI, and move on. KISS.  :D
Not to psychoanalyze too much, but if dr fish has *no* stocks, there's something going on there. S/he wrote in the OP that they "expect to get chewed out", and I'm guessing "go all in" will turn out to be advice that's easier to give than to take.
At the same time, I agree with you. It's probably the best thing to do.
“As a white person of colour, I am extremely concerned about the rise of black whiteness.” — Titania McGrath
pariah — 1610s member of a low caste in S. India; Tamil (Dravidian) “drummer”, as members of the lowest caste played drums at festivals. “social outcast,” 1819.
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