Schwab Windhaven portfolios

[Jan Van]

My friends at Schwab send me a brochure about their Windhaven portfolios. To my amazement they include GOLD:
http://www.schwab.com/public/schwab/pla ... portfolios

Nice. Too convoluted and too expensive for me though, between 0.8% and 0.95%...

[MediumTex]

They should call them the "Schwab Windfall Portfolios".

The brochures could show the Schwab brokers having fun on vacation.

[moda0306]

I have yet to see a fund that doesn't avoid long-term treasuries like the plague.  Look at the "fixed income" portion. "T-notes, short TIPS, long TIPS..."

Even PRPFX goes light on them.

My 401(k) offers a treasury MM fund, but the only bond fund it offers is intermediate-term risky stuff.

Pathetic.

Not to mention, right at the height of commodity prices, they offered a commodity basket fund.  That was my "shoe-shiner stock picker moment" where I decided commodities would probably back off signficantly soon.

[KevinW]

I have yet to see a fund that doesn't avoid long-term treasuries like the plague.  Look at the "fixed income" portion. "T-notes, short TIPS, long TIPS..."

I mentioned a couple examples of LTT-heavy portfolios in another thread ( http://gyroscopicinvesting.com/forum/in ... opic=996.0 ).  Just cross-posting in case anyone is subscribed to this thread and not that one.

[moda0306]

Not to pick a bone, Kevin, but I only saw Total Bond Market mentioned, and at 8% long-term I wouldn't call it heavy, especially if "long-term" means <20-yr bonds.

[KevinW]

I said "portfolios," meant to include the YMOYL and Bodie portfolios which are nearly 100% treasuries.

[KevinW]

And I should add that AFAIK those portfolios are even more obscure than the PP.

[MediumTex]

And I should add that AFAIK those portfolios are even more obscure than the PP.

Whoa.

More obscure than the PP?

That's like talking about a solo project of a member of Los del Rio.  

http://www.youtube.com/watch?v=sN62PAKo ... re=related

[KevinW]

Well that's based on my own subjective sense of internet "buzz."

Those two portfolios are, to my knowledge, each only covered by a single book and the author's own website.  The PP, while still quite obscure, does have more media dedicated to it: multiple books by Browne et al.; blogs by craigr, Marc De Mesel, and Paul Douglas Boyer; the original radio show and craigr's podcast; PRPFX and its marketing materials; American Asset Management (julian); the Boglehead thread; occasional mentions in the mainstream financial media; this forum; and probably others I'm forgetting.

[MediumTex]

Kevin,

I'm just kidding.  With PRPFX, the PP is anything but obscure, though I think most people still don't really "get" what it's all about.

[KevinW]

Hah -- guess my internet sarcasm detector needs calibration. 

[ochotona]

Sorry to resurrect a dead thread... but I'm in one of the Windhaven Portfolios. I am trying to figure out what to do about my position; I like them for the same reason I like the PP, but of course the PP is cheap and simple to implement, whereas Windhaven is complex and expensive. They're spendy, but the performance numbers they post are net of their fees, so in principle, if they can earn their keep, I'm OK with it. As soon as I get some updated data from them, I'm going to post it then I will think about it some more, and I suppose so will all of you. They are very slow in getting EOY 2014 results published to their website.

[ochotona]

Well, it's not pretty. I won't bother with the numbers, but PP used Windhaven (Aggressive Strategy) to wipe up the floor for 5 and 10 year periods. I computed standard deviations of calendar returns for ten years, and PP was less volatile, but both 5 and 10 year CAGRs were higher for PP. Windhaven beat PP for 13 year CAGR, though, but std dev was higher.

That being said... Windhaven did deliver the same 10 year CAGR at lower standard deviation than the ARWIX target fund that I used as a conventional reference. So they are doing what they say... just not enough to match or beat PP for 5 and 10 years.

The 2008 results for Windhaven were -20.8%, much better than other aggressive allocation funds actually, which were down at least twice that, which is what drew my attention to them in the first place. They do use gold and commodities.

They had a crappy year in 2013, just +1.3%. If they'd had a normal year, I would keep them without question. The timings are different than PP, which could be useful. If they can't pull the 10 year CAGR up next year, I'm out.

[Jan Van]

Maybe their Intelligent Portfolios will be another alternative for you: Introducing Schwab Intelligent Portfolios