Stocks: fighting the pull of recency/past performance

[dualstow]

I'm looking at YTD, 10-year, and everything in between at Vanguard.
I see that over most periods, my mid-cap and small-cap index funds handily beat both my overall performance and the individual stock portfolio my father trades. Did it beat the pp over these periods? I don't know, and I've only had the pp since maybe 2010.

Doesn't matter anyway.

Still, on some days I'm just tempted to throw everything into mid-cap, contribute a few hundred $ each month, hold a small % in cash, and not look for 20 years.

[ochotona]

You could just take your stock allocations, divvy it up four ways (small, mid, large, and non-US) and rebalance it once a year. That's pretty simple and easy and not much to worry over.

[dualstow]

Yep. I don't own ex-US which makes simpler still.

[ochotona]

The leadership rotates. At some point, ex-US stocks will be the hot ones. Not for a while.

[dualstow]

Thanks to the portfoliocharts thread I'm back on track.

[ochotona]

Merriman Ultimate looks good

[dualstow]

Merriman Ultimate looks good

It seems like just a few years ago, Vanguard required a lot more money in a fund for it to qualify for Admiral status. Now, it's just $10,000 for a lot of stock funds instead of, what, $50,000? That's important to me because of the better expense ratio in Admiral shares. I'd rather not slice and dice at all if I'm going to have to pay a lot more in expenses (%wise, even if that turns out to not look significant in $ amounts in the early days).

And, I wouldn't want to see my shares dip back into Investor status every time there's a big downturn.

Now, it's a lot easier to slice and dice.
Still, with all that slicing and dicing, Merriman still has a pretty nasty-looking worst drawdown, more than 1/5.

[Reub]

Looking at these great charts, can someone make a good case for the PP vs. The Golden Butterfly Portfolio?

[fi50@fi2023]

I use Merriman ultimate for my stock allocation, although I constantly argue with my company's 401k advisor about it.

[ochotona]

Looking at these great charts, can someone make a good case for the PP vs. The Golden Butterfly Portfolio?

The GB is a really good one, that's for sure.

[Reub]

I'm curious how the GB measures up to Merriman?

Also I'd be a little cautious about any stock heavy portfolio right now with the way that the market is behaving. Even these.

[Dieter]

I'm curious how the GB measures up to Merriman?

Also I'd be a little cautious about any stock heavy portfolio right now with the way that the market is behaving. Even these.

Only here is 40% stocks considered stock heavy....  

As for comparison with Merriman, if want to put in all the details, can use the envy chart.... Merriman 60/40, I think. So, 50% more stock, 100% less gold than Golden butterfly 20%; has lots on Int'l.


Would love to see the TrevH version of Merriman on the charts --- instead of 8(?) slices, just four equal parts equity:
* Large Balanced
* Int'l Large Value
* Small Cap Value
* Int'l Small Cap

[Fred]

Looking at these great charts, can someone make a good case for the PP vs. The Golden Butterfly Portfolio?

I asked the same question in the general discussion forum and didn't hear any good case against the GB. When I recently hit a re-balance point with gold < 15% I felt more comfortable bringing it back to 20% than 25% so I decided to go with the GB for now.

One thing I like about this portfolio is that I think it's a little easier to handle when you're still working and contributing to a 401k as most of these plans are heavy on stocks. When I retire and have complete control in an IRA I may work back into the PP.

And like I said in the other discussion, if it makes you feel disloyal to the HB philosophy you can always tell yourself that half of your stock allocation is your VP and that problem is solved.

One thing that wasn't so easy was trying to split the stock allocation into a 50-50 Large Blend, Small Value combo within a 401k. Adds another level of complexity to it. My wife's 401k actually offered those exact options with Vanguard funds but mine didn't so I just had to make the best of it. Looking at the charts, I wonder how much it actually matters.

Also, I wonder what would be the re-balancing bands are with this portfolio.

[fi50@fi2023]

Technically the Merriman portfolio is all stocks, with the investor to choose how much bond exposure to add based upon risk tolerance.

He does have an article that suggests a smaller portfolio 4 fund and U.S. Only. I use his Vanguard taxable recommendation for my 25% stock allocation.

[Dieter]

Looking at these great charts, can someone make a good case for the PP vs. The Golden Butterfly Portfolio?

..... <snip>......
One thing that wasn't so easy was trying to split the stock allocation into a 50-50 Large Blend, Small Value combo within a 401k. Adds another level of complexity to it. My wife's 401k actually offered those exact options with Vanguard funds but mine didn't so I just had to make the best of it. Looking at the charts, I wonder how much it actually matters.

Also, I wonder what would be the re-balancing bands are with this portfolio.

In the long run there is expected size and value premium, so only get part of it. Long run might be very long, and expected <> guaranteed. Aka, seems fine to me. Can check it out at portfolio harts yourself....

If start with the PP 40% rebalance bands.