A slightly different way to compare Betterment and Vanguard

[milesdividendmd]

* I am awfully intrigued by one feature of Wealthfront (a Betterment competitor). For customers with over $500k in their accounts, they will purchase individual stock on your behalf for every company in the S&P 500. They will then do tax-loss harvesting on the individual stocks. Scroll down to "Tax-Optimized Direct Indexing" on their FAQ for more info. This is completely infeasible to do manually because of trading commissions and general complexity. It can provide measurable benefit over harvesting losses on ETFs because you can't harvest ETF losses in years where the market is up, but there are always some individual stocks that have gone down recently. If I had $500k to invest in taxable index funds, I would seriously consider paying Wealthfront's 0.25% management fee to get this benefit until I retire and my tax rate goes down.

The problem with tax loss harvesting on individual stock holdings is that it is impossible to replace the sold stock with a super highly correlated asset  during the wash sale period the way you can do with a fund.  The chart in the FAQ you linked to shows a tracking difference from the underlying index of what looks like an average of around 2% over the past 14 years, and over 4% in one year.

This is a good point, But tracking error is not always a bad thing.

Although it is behaviorally difficult to underperform your index for a period of time, what really matters is your long-term risk-adjusted performance relative to the index, right?  No one minds the sort of tracking error that Warren Buffett suffers (at least in retrospect) after all.

My guess is that divesting in individual stocks with negative momentum in exchange for a broad index holding for 30 days at a time would  have a positive overall tracking error long-term. (Because of the momentum anomaly.)

It's a little tough to say looking at their tracking error graph.

I don't believe that broad indexing works Long term because index funds have less tracking error relative to their index. I believe it works because Cap weighting is the cheapest way to invest, and costs matter.

[DrF]

Thank you Miles...for providing that anecdotal evidence.

Since we are now sharing personal stories. I don't have betterment, yet I was able to tax loss harvest this year. I sold an etf at the end of August that I'd held for over a year (long term capital gains), and purchased a different etf. Well, by the second week of October that newly purchased etf had tanked pretty badly, so I sold it and harvested over $2200. I turned around and repurchased the first etf that I had sold for a profit (which was now selling at a handsome discount).

In all it took me 3 and a half minutes to complete the sell and repurchase. Voila.

Miles and OP are making my point for me. OP has already indicated he is a HCE. How much do you make annually Miles? $200,000? $400,000? Yes, you should have lots of money in a taxable account. Betterment is only partially viable for the high net worth TAXABLE investor. Do you have all of your accounts at Betterment? Why not? Wouldn't that be the only way to reap the full benefit from their services? What's that...you don't want to pay the commissions on $600,000 per year? What happens when you have $1M or $4M under management at betterment? Are you able to recoup your commissions through TLH and better returns by auto-rebalancing? I think not.

Your anecdote tells me little.  You harvested $2200 of how much invested?  What is the make up of your portfolio?  What is your overall TLH % this year?

Here is what I can deduce from your statement,

You have harvested exactly one tax loss this year for 2200$, which took you 3 minutes.
 
When compared to my experience with Betterment, that's not very impressive at all, as Betterment has tax loss harvested on 4 seperate occasions with 3 seperate assets in only 4 months since I enrolled in TLH. My annualized TLH rate is 4.5-5%, for a savings of 1.5-2.5% at my marginal tax rate.  (pretty good deal for an additional cost of 0.25%)

My guess, based on your statement, is that you are leaving a lot of TLH opportunities on the table.  Not suprising, TLH is hard to execute well.  You are only human, after all, which means you are subject to underperformance and overconfidence just like the rest of us.

As to my own investing decisions, most of my investments are held in my workplace retirement, and HSA accounts through Fidelity and TD Ameritrade.  (As you may be aware employers generally determine where you can invest in such accounts, so your point is sort of misguided. I could not invest this money with Betterment no matter my preferences.)

I have repeatedly stated that taxable accounts > 50K are the sweetspot for Betterment because of TLH, though I do have some IRA money invested with them as well.  Overall I am happy with the product, and think that it is an excellent buy and hold strategy for most investors.  (I've got no problem with a low cost slice and dice portfolio either.)  I probably would not invest more than 500K with Betterment or any other brokerage firm for that matter (including Vanguard), because of the limits of FINRA/SIPC insurance. 

But I think it is more than likely that Betterments 0.15 % fee when compared to  target date funds will be more than covered long term by TLH and increased CAGR from their small value tilted portfolio.  (That certainly would've been the case for the past 50 years, based on backtesting, even after fees.)

I'm shocked no one commented on the wealth allocation graph I linked, or the census data I provided.

I'll play along Miles. I am the embodiment of the "typical" mustachian that I posted about above. Annual household income ~$100,000. Total investment assets ~$100,000. On target to save ~$50,000 this year, ~$40,000 of which will be in tax advantaged accounts. Of my investment assets, only ~$13,000 are in a taxable account. So, I was able to TLH nearly 20% this year alone!

Fine, if everyone wants to join Betterment, be my guest. Among all brokers/investment companies they probably rank near the top in cost/benefit. But, you will never convince me that the benefits fully compensate for the fees they charge for a long term investor.

[milesdividendmd]

Thank you Miles...for providing that anecdotal evidence.

Since we are now sharing personal stories. I don't have betterment, yet I was able to tax loss harvest this year. I sold an etf at the end of August that I'd held for over a year (long term capital gains), and purchased a different etf. Well, by the second week of October that newly purchased etf had tanked pretty badly, so I sold it and harvested over $2200. I turned around and repurchased the first etf that I had sold for a profit (which was now selling at a handsome discount).

In all it took me 3 and a half minutes to complete the sell and repurchase. Voila.

Miles and OP are making my point for me. OP has already indicated he is a HCE. How much do you make annually Miles? $200,000? $400,000? Yes, you should have lots of money in a taxable account. Betterment is only partially viable for the high net worth TAXABLE investor. Do you have all of your accounts at Betterment? Why not? Wouldn't that be the only way to reap the full benefit from their services? What's that...you don't want to pay the commissions on $600,000 per year? What happens when you have $1M or $4M under management at betterment? Are you able to recoup your commissions through TLH and better returns by auto-rebalancing? I think not.

Your anecdote tells me little.  You harvested $2200 of how much invested?  What is the make up of your portfolio?  What is your overall TLH % this year?

Here is what I can deduce from your statement,

You have harvested exactly one tax loss this year for 2200$, which took you 3 minutes.
 
When compared to my experience with Betterment, that's not very impressive at all, as Betterment has tax loss harvested on 4 seperate occasions with 3 seperate assets in only 4 months since I enrolled in TLH. My annualized TLH rate is 4.5-5%, for a savings of 1.5-2.5% at my marginal tax rate.  (pretty good deal for an additional cost of 0.25%)

My guess, based on your statement, is that you are leaving a lot of TLH opportunities on the table.  Not suprising, TLH is hard to execute well.  You are only human, after all, which means you are subject to underperformance and overconfidence just like the rest of us.

As to my own investing decisions, most of my investments are held in my workplace retirement, and HSA accounts through Fidelity and TD Ameritrade.  (As you may be aware employers generally determine where you can invest in such accounts, so your point is sort of misguided. I could not invest this money with Betterment no matter my preferences.)

I have repeatedly stated that taxable accounts > 50K are the sweetspot for Betterment because of TLH, though I do have some IRA money invested with them as well.  Overall I am happy with the product, and think that it is an excellent buy and hold strategy for most investors.  (I've got no problem with a low cost slice and dice portfolio either.)  I probably would not invest more than 500K with Betterment or any other brokerage firm for that matter (including Vanguard), because of the limits of FINRA/SIPC insurance. 

But I think it is more than likely that Betterments 0.15 % fee when compared to  target date funds will be more than covered long term by TLH and increased CAGR from their small value tilted portfolio.  (That certainly would've been the case for the past 50 years, based on backtesting, even after fees.)

I'm shocked no one commented on the wealth allocation graph I linked, or the census data I provided.

I'll play along Miles. I am the embodiment of the "typical" mustachian that I posted about above. Annual household income ~$100,000. Total investment assets ~$100,000. On target to save ~$50,000 this year, ~$40,000 of which will be in tax advantaged accounts. Of my investment assets, only ~$13,000 are in a taxable account. So, I was able to TLH nearly 20% this year alone!

Fine, if everyone wants to join Betterment, be my guest. Among all brokers/investment companies they probably rank near the top in cost/benefit. But, you will never convince me that the benefits fully compensate for the fees they charge for a long term investor.

Interesting claim.

So what asset did you invest in that allowed you to take a 20% tax loss?  A Russian oil company?

(The peak to trough loss in the past year for VWO, the most volatile standard asset class, was only 5%, so your claim is pretty hard to believe.)

Please enlighten the rest of us with the details of your TLH prowess.

[DrF]

Thank you Miles...for providing that anecdotal evidence.

Since we are now sharing personal stories. I don't have betterment, yet I was able to tax loss harvest this year. I sold an etf at the end of August that I'd held for over a year (long term capital gains), and purchased a different etf. Well, by the second week of October that newly purchased etf had tanked pretty badly, so I sold it and harvested over $2200. I turned around and repurchased the first etf that I had sold for a profit (which was now selling at a handsome discount).

In all it took me 3 and a half minutes to complete the sell and repurchase. Voila.

Miles and OP are making my point for me. OP has already indicated he is a HCE. How much do you make annually Miles? $200,000? $400,000? Yes, you should have lots of money in a taxable account. Betterment is only partially viable for the high net worth TAXABLE investor. Do you have all of your accounts at Betterment? Why not? Wouldn't that be the only way to reap the full benefit from their services? What's that...you don't want to pay the commissions on $600,000 per year? What happens when you have $1M or $4M under management at betterment? Are you able to recoup your commissions through TLH and better returns by auto-rebalancing? I think not.

Your anecdote tells me little.  You harvested $2200 of how much invested?  What is the make up of your portfolio?  What is your overall TLH % this year?

Here is what I can deduce from your statement,

You have harvested exactly one tax loss this year for 2200$, which took you 3 minutes.
 
When compared to my experience with Betterment, that's not very impressive at all, as Betterment has tax loss harvested on 4 seperate occasions with 3 seperate assets in only 4 months since I enrolled in TLH. My annualized TLH rate is 4.5-5%, for a savings of 1.5-2.5% at my marginal tax rate.  (pretty good deal for an additional cost of 0.25%)

My guess, based on your statement, is that you are leaving a lot of TLH opportunities on the table.  Not suprising, TLH is hard to execute well.  You are only human, after all, which means you are subject to underperformance and overconfidence just like the rest of us.

As to my own investing decisions, most of my investments are held in my workplace retirement, and HSA accounts through Fidelity and TD Ameritrade.  (As you may be aware employers generally determine where you can invest in such accounts, so your point is sort of misguided. I could not invest this money with Betterment no matter my preferences.)

I have repeatedly stated that taxable accounts > 50K are the sweetspot for Betterment because of TLH, though I do have some IRA money invested with them as well.  Overall I am happy with the product, and think that it is an excellent buy and hold strategy for most investors.  (I've got no problem with a low cost slice and dice portfolio either.)  I probably would not invest more than 500K with Betterment or any other brokerage firm for that matter (including Vanguard), because of the limits of FINRA/SIPC insurance. 

But I think it is more than likely that Betterments 0.15 % fee when compared to  target date funds will be more than covered long term by TLH and increased CAGR from their small value tilted portfolio.  (That certainly would've been the case for the past 50 years, based on backtesting, even after fees.)

I'm shocked no one commented on the wealth allocation graph I linked, or the census data I provided.

I'll play along Miles. I am the embodiment of the "typical" mustachian that I posted about above. Annual household income ~$100,000. Total investment assets ~$100,000. On target to save ~$50,000 this year, ~$40,000 of which will be in tax advantaged accounts. Of my investment assets, only ~$13,000 are in a taxable account. So, I was able to TLH nearly 20% this year alone!

Fine, if everyone wants to join Betterment, be my guest. Among all brokers/investment companies they probably rank near the top in cost/benefit. But, you will never convince me that the benefits fully compensate for the fees they charge for a long term investor.

Interesting claim.

So what asset did you invest in that allowed you to take a 20% tax loss?  A Russian oil company?

(The peak to trough loss in the past year for VWO, the most volatile standard asset class, was only 5%, so your claim is pretty hard to believe.)

Please enlighten the rest of us with the details of your TLH prowess.

I use leverage of course. My long position was TQQQ (made ~$4000 long term gains during 2013/2014), sold that, bought into URTY around ~Sept 1 (TLH ~$2200 ~Oct 14), rebought into TQQQ on the same day as TLH (up ~40% to date)

http://forum.mrmoneymustache.com/investor-alley/triple-leverage-etf/msg437458/#msg437458

[milesdividendmd]

Thank you Miles...for providing that anecdotal evidence.

Since we are now sharing personal stories. I don't have betterment, yet I was able to tax loss harvest this year. I sold an etf at the end of August that I'd held for over a year (long term capital gains), and purchased a different etf. Well, by the second week of October that newly purchased etf had tanked pretty badly, so I sold it and harvested over $2200. I turned around and repurchased the first etf that I had sold for a profit (which was now selling at a handsome discount).

In all it took me 3 and a half minutes to complete the sell and repurchase. Voila.

Miles and OP are making my point for me. OP has already indicated he is a HCE. How much do you make annually Miles? $200,000? $400,000? Yes, you should have lots of money in a taxable account. Betterment is only partially viable for the high net worth TAXABLE investor. Do you have all of your accounts at Betterment? Why not? Wouldn't that be the only way to reap the full benefit from their services? What's that...you don't want to pay the commissions on $600,000 per year? What happens when you have $1M or $4M under management at betterment? Are you able to recoup your commissions through TLH and better returns by auto-rebalancing? I think not.

Your anecdote tells me little.  You harvested $2200 of how much invested?  What is the make up of your portfolio?  What is your overall TLH % this year?

Here is what I can deduce from your statement,

You have harvested exactly one tax loss this year for 2200$, which took you 3 minutes.
 
When compared to my experience with Betterment, that's not very impressive at all, as Betterment has tax loss harvested on 4 seperate occasions with 3 seperate assets in only 4 months since I enrolled in TLH. My annualized TLH rate is 4.5-5%, for a savings of 1.5-2.5% at my marginal tax rate.  (pretty good deal for an additional cost of 0.25%)

My guess, based on your statement, is that you are leaving a lot of TLH opportunities on the table.  Not suprising, TLH is hard to execute well.  You are only human, after all, which means you are subject to underperformance and overconfidence just like the rest of us.

As to my own investing decisions, most of my investments are held in my workplace retirement, and HSA accounts through Fidelity and TD Ameritrade.  (As you may be aware employers generally determine where you can invest in such accounts, so your point is sort of misguided. I could not invest this money with Betterment no matter my preferences.)

I have repeatedly stated that taxable accounts > 50K are the sweetspot for Betterment because of TLH, though I do have some IRA money invested with them as well.  Overall I am happy with the product, and think that it is an excellent buy and hold strategy for most investors.  (I've got no problem with a low cost slice and dice portfolio either.)  I probably would not invest more than 500K with Betterment or any other brokerage firm for that matter (including Vanguard), because of the limits of FINRA/SIPC insurance. 

But I think it is more than likely that Betterments 0.15 % fee when compared to  target date funds will be more than covered long term by TLH and increased CAGR from their small value tilted portfolio.  (That certainly would've been the case for the past 50 years, based on backtesting, even after fees.)

I'm shocked no one commented on the wealth allocation graph I linked, or the census data I provided.

I'll play along Miles. I am the embodiment of the "typical" mustachian that I posted about above. Annual household income ~$100,000. Total investment assets ~$100,000. On target to save ~$50,000 this year, ~$40,000 of which will be in tax advantaged accounts. Of my investment assets, only ~$13,000 are in a taxable account. So, I was able to TLH nearly 20% this year alone!

Fine, if everyone wants to join Betterment, be my guest. Among all brokers/investment companies they probably rank near the top in cost/benefit. But, you will never convince me that the benefits fully compensate for the fees they charge for a long term investor.

Interesting claim.

So what asset did you invest in that allowed you to take a 20% tax loss?  A Russian oil company?

(The peak to trough loss in the past year for VWO, the most volatile standard asset class, was only 5%, so your claim is pretty hard to believe.)

Please enlighten the rest of us with the details of your TLH prowess.

I use leverage of course. My long position was TQQQ (made ~$4000 long term gains during 2013/2014), sold that, bought into URTY around ~Sept 1 (TLH ~$2200 ~Oct 14), rebought into TQQQ on the same day as TLH (up ~40% to date)

http://forum.mrmoneymustache.com/investor-alley/triple-leverage-etf/msg437458/#msg437458

Hahaha!

The benefits of leverage. More losses!

You are a financial wizard. Betterment can clearly add nothing to your genius.

Behavioral errors anyone?

[DrF]

People fear what they don't understand.

Read the thread I linked.

[milesdividendmd]

People fear what they don't understand.

Read the thread I linked.

Oh I understand leverage quite well. I'm just not interested in it as a strategy for myself. I'm not a big fan of drawdowns, especially when they are out of proportion to returns. To each his own.

It's just humorous that you're railing against a 0.25% management fee from betterment when you happily lose thousands of dollars with a leveraged fund with an expense ratio of 0.95%!

[DrF]

People fear what they don't understand.

Read the thread I linked.

Oh I understand leverage quite well. I'm just not interested in it as a strategy for myself. I'm not a big fan of drawdowns, especially when they are out of proportion to returns. To each his own.

It's just humorous that you're railing against a 0.25% management fee from betterment when you happily lose thousands of dollars with a leveraged fund with an expense ratio of 0.95%!

All you see is cost. All I see is benefit.

Merry Christmas to all. May the coming year be as fruitful as this last!

[milesdividendmd]

I see cost and benefit, which is why I'm not interested.

Specifically I see 3.33X cost and 2.67X benefit. All at > 3X expenses.

More importantly I see the risk of margin calls, and the permanent loss of capital with the inevitable next black swan event.

I am quite confident that betterment will outperform a triple leveraged portfolio in the long term.

Even proshares advises against using TQQQ as a long term investment. 

Volatility hurts much more on the downside than it helps on the upside. So when you combine long term investing with

1.  High costs
2.  A Poor risk/return profile
3.  High volatility and
4.  The Increased risk of the permanent loss of capital with black swan events,

You end up with a real losing long term strategy.

Debating the merits of betterment is truly meaningless when compared to the ill considered risks of using three times leverage as a long-term buy-and-hold strategy.

[DrF]

Meh.

You are factually incorrect on multiple accounts.

I'd be more than happy to debate this with anyone, once they've educated themselves. Clearly you did not read the entire thread. Plus, read the multiple links kindly provided. It took me about 3-4 hours, but I've already been studying this strategy for years.

If it's not for you, fine. Invest with betterment, which I have already stated is probably at the higher end of cost/benefit. I've found something even better though.

[milesdividendmd]

Why bother with specific points?

Blanket statements such as "you are factually incorrect" show such a depth of understanding.

Good luck with your strategy!

[DrF]

1. High costs - this is irrelevant unless benefit is taken into account. As I showed in the other thread, an annual return of >21% more than compensates. If it were only a matter of cost, we would all live in the cheapest house available, community be damned!
2. Poor risk/return profile - incorrect, because these etfs are based on index funds they virtually guarantee reversal after a down period. The return is phenomenal as proven in the other thread.
3. High volatility - incorrect, proper employment of a leveraged strategy entails rebalancing (quarterly/yearly). One should do this with any portfolio. In fact, rebalancing reduces volatility to below that of buy and hold of a 1x fund (as stated in the other thread).
4. Black swan events would not happen - Specific Leveraged funds require zero margin, thus, no margin calls. The nature of leverage protects the buyer during severe downturns (ie, if the 1x fund falls ~20%, the 2x or 3x funds fall less than 2x and 3x). Persistent up trends can result in near exponential type growth.

Thus, all your claims are invalidated.

Are you this severely antagonistic in person?

[milesdividendmd]

Your spreadsheet is not very convincing. Not sure where you get your raw data, but Tqqq did not exist before 2010.

1.  Annual (arithmetic) returns of 21% (before fees).

Your actual CAGR (ie your take home) will be much lower after fees, because of volatility.

Let's take a look at how Tqqq fared after fees during this relatively calm market period from 2011 to 2013... Real returns.

http://www.portfoliovisualizer.com/backtest-portfolio#analysisResults

Hmmm, it appears that tqqq CAGR is 2.67X higher then that of QQQ.

But it's volatility was 3.1 times higher. More concerning the maximum drawdown was 3.33 times higher.

And this decreased efficiency is well demonstrated by Both the sharp ratio and the sortino ratio.

[milesdividendmd]

2.  If the returns are phenomenal, then the drawdowns are super phenomenal as demonstrated above.

3.  As demonstrated above the volatility is higher by a larger factor than the return.

4. Black swan events always happen. And you will be uniquely positioned to be devastated by the next one if you have a significant portion of your portfolio in TQQQ. Have fun rebalancing during the next bear market.

5.  Severely antagonistic is labeling people who disagree with you "shills" when you live in the glassiest of glass houses.

[DrF]

Again, you haven't even looked at the thread, or given any scrutiny to the spreadsheet I linked. I'll give you a pass if you don't comprehend, because what I'm laying down is some next level shit here. IME it does take some MDs an inordinate amount of time and handholding to understand enigmatic ideas.

It appears as though all you care about is "winning".

I'd gladly continue if I felt anyone else was following/remotely interested. Give a "yes" if you'd like me to continue. Otherwise, happy trails.

[milesdividendmd]

Enjoy your "next level" outcome.

Sadly as an MD I just can't crack your "enigmatic" methods.

I am curious how you propose to have backtested a strategy during a time period when the fund being backtested did not exist.

That really is Some enigmatic next level shit.

Edit:  I see that you back tested SSO not TQQQ.

Interesting that it took > 5 years to get back to even money following 2008.

[RapmasterD]

a) Happy trails.

b) One of my new year's resolutions is to not open any threads on this Betterment versus Vanguard topic.

c) Yawn.

d) Cough.

e) https://www.youtube.com/watch?v=QPo03NNe5QY

[cafebueno]

A bit of an overdue update:

Now that I've had said funds in Betterment for a while, I'm looking to move them out and manage them on my own.  (Yes, I am sure to some of you the answer to this is "DUH!", but find it in yourself to step out of your experienced shoes and see if you can remember what it was like before you knew everything in the world. You can do it!)

I still have a lot to learn despite it having been a while since I started.  But I want to note some of the reasoning for moving the funds out, some of which was not mentioned here and thus might be useful for someone else who's debating this. 

The main motivation, I would say, is that I am still doubting my abilities to be quite the expert in financing as a lot of folks here (maybe that will change over time, who knows).  At the same time, I want to feel like I want a certain level of understanding of what's going on with my funds.  So...

1. Betterment's portfolio ends up being time-consuming to parse: there's something like 4-12 funds in the portfolio depending on the stock/bond slider setting, and even if the slider does not change, the fund choices and allocation could change over time.
2. Value-wise: thanks to explanations on this thread, I do not consider rebalancing to be worth the fee, so it really just comes down to TLH.  As I understand it so far, there's a practical limit to how much you can tax loss harvest a given set of shares. After that, the Betterment fee is paying for a service with a diminished ability to get value out of.  If I'm in a wealth building stage, there would be new shares that could be harvested, but even then it seems like over time the percentage of my portfolio subject to TLH seems like it would end up being the minority.   Maybe there is some scheme to take money out of Betterment after it's been harvested and move that elsewhere, but that sounds like a major pain, at least more than the alternative of just managing less funds on my own.
3. Given the previous two points: to avoid a wash sale by an automated Betterment tax loss harvest, I have to track whether I have a fund outside of Betterment (including in IRAs, and more importantly 401ks which in my current and past jobs have overpriced funds except for one or two, those of which then happen to be ones in Betterment's portfolio).   Betterment's answer to this is to...move my IRAs to Betterment(!).  Alternatively, you can link other accounts to them, but I never trust any site to keep my login and passwords to other sites, as it sounds like a security breach disaster time bomb (in some cases it's even against the T&C of the target sites to share the credentials).

In the end, my desire for simplification could be argued to be my own "fee" of sorts in terms of what extra money I might not make with a more complex, algorithmic management, but I feel like the merits of what that after-cost difference is (or if it value even exists or not depending on who you ask) could be (and is!) argued in these forums for eternity, but Betterment's fee is a given constant.  (Side note 1: my desire for simplification may currently be confirmation-biased by jlcollinsnh's stock series.)  I don't feel comfortable that once my money is in an automated, sophisticated management system, I am practically giving up my ability to understand what is happening, which would increase over time.  It gives me a sense that I must choose between understanding what is happening with my funds or blindly trusting what a third party would do.  If I wanted to "check-in" on occasion, then I'm now putting in more time than if I just did it myself.

There are some other behavioral lessons learned for myself:  Betterment won't prevent me from making a poor behavioral investment choice more than Vanguard.  Both let me log in and see how my investments are doing and provide a metric to tell me how they are performing, so with both I will need to learn to surpass the desire to muck with my investments.   (Side note 2: I'm going through this great post about one's ability to handle volatility.  I kept on course during the 2008 sad times, but that drawdown, part 1 blog post really takes the perspective to the next level!)

Thanks again to @Dodge for the explanations on rebalancing, and to thew few others who took the high road to empathize with a newbie.