Anyone else feel like their Betterment accounts are under-performing?

[cbgg]

I'm guessing a lot of folks here have accounts with Betterment.  Does anyone else have a gut level feel that their Betterment account is under performing relative to their other accounts?

I have 2 accounts I started in April of 2015
1) A 401k with a new company
2) A taxable Betterment account

Both accounts have the same risk profile (90/10), both received dollars spread out between April and December 2015.  Both lost money this year, but the Betterment account did significantly worse.  This could have just been the luck of the draw based on the actual days my deposits went through, but I wonder if others are feeling bewildered by just how badly their Betterment accounts performed.

I have other accounts that also fared a lot better than the Betterment account this year, but since both of the above were started in April it seemed like a good one to compare.

[cbgg]

My hypothesis is that this is because Betterment includes more international exposure than most other built portfolios.  (My other accounts are all in lifecycle funds)

[tj]

Betterment is more diviersified. It is doing what it is supposed to do. It doesn't always mean that it will perform better than a less diversified option. especially during a short period of time. if it made sense for you to go with betterment in the first place, I would imagine it makes sense to stick with them now.

[Heckler]

It'll over perform well in the next Great (US) Recession, compared to a 100% VTSAX that's so popular around here!

[MustacheAndaHalf]

My hypothesis is that this is because Betterment includes more international exposure than most other built portfolios.  (My other accounts are all in lifecycle funds)

What's strange to me is that you're speculating about what's contained in your own accounts.  Wouldn't it be better to look at the specific funds?  It would least help to know the allocation between US stock, international stock, and bond funds.

[Mr. FI]

It is because of the emphasis on Intl exposure. They also tilt slightly more towards value and small caps in the U.S. which have been hit hard lately. But when I signed up for a Betterment account, I believed in the long term strategy they employ--I think it will come around full circle.

[cbgg]

My hypothesis is that this is because Betterment includes more international exposure than most other built portfolios.  (My other accounts are all in lifecycle funds)

What's strange to me is that you're speculating about what's contained in your own accounts.  Wouldn't it be better to look at the specific funds?  It would least help to know the allocation between US stock, international stock, and bond funds.

I did look at the actual funds and know what they are.  I was speculating that this part of the mix was the reason for the difference and wanted to see if others thought the same.

[cbgg]

It is because of the emphasis on Intl exposure. They also tilt slightly more towards value and small caps in the U.S. which have been hit hard lately. But when I signed up for a Betterment account, I believed in the long term strategy they employ--I think it will come around full circle.

Yeah, I believe in it too.  But sometimes it gives me indigestion.  This is my first time sustaining any significant losses and it hurts!  I just keep reminding myself to stay the course and think about the overall strategy that I'm trying to stick to rather than getting freaked out and have an emotional reaction.

[johnny847]

It is because of the emphasis on Intl exposure. They also tilt slightly more towards value and small caps in the U.S. which have been hit hard lately. But when I signed up for a Betterment account, I believed in the long term strategy they employ--I think it will come around full circle.

Yeah, I believe in it too.  But sometimes it gives me indigestion.  This is my first time sustaining any significant losses and it hurts!  I just keep reminding myself to stay the course and think about the overall strategy that I'm trying to stick to rather than getting freaked out and have an emotional reaction.

http://awealthofcommonsense.com/worlds-worst-market-timer/