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Learning, Sharing, and Teaching => Investor Alley => Topic started by: Left on March 01, 2015, 11:21:11 AM

Title: Anyone use iShare's core etfs?
Post by: Left on March 01, 2015, 11:21:11 AM
I'm thinking about redoing my portfolio and replacing it with a single ETF, ishares AOA.

Does anyone use it or know of any obvious reason not to? I know the ER is more expensive than vanguard's lifestrategy but I like the AOA better. Both are new enough to not have much historic data to compare.

I'm wanting to use it as my IRA's single fund. And I'm wanting to switch out of the 80/20 lifestrategy to AOA but I'm not sure what pros/cons there are except it "looks" more diverse but I'm not technical enough to know for sure.
Title: Re: Anyone use iShare's core etfs?
Post by: Mighty-Dollar on March 01, 2015, 09:06:59 PM
That would have been a great fund to own from 2009 to present. That fund is more aggressive than the S&P 500 index and the total stock market index. With stocks at all time highs I'd be just a little less aggressive.
Title: Re: Anyone use iShare's core etfs?
Post by: Left on March 02, 2015, 10:12:23 AM
How do you know they are at an all time high? I mean yes it is, but since I believe stocks will go higher as a trend, shouldn't it be at the all time highs a majority of the time?

I liked it for the aggressive part which is why I was thinking about getting it. I'm tempted to try it out for the time being I guess, I know I shouldn't mess with my AA so much but I'm curious about it. I'll pull the gun after doing more research about it.
Title: Re: Anyone use iShare's core etfs?
Post by: gecko10x on March 02, 2015, 10:17:12 AM
I see no reason not to; I use them as benchmarks for my portfolios.
Title: Re: Anyone use iShare's core etfs?
Post by: Left on March 02, 2015, 11:53:11 AM
I got impatient, I made an "experiment" portfolio with 80% aoa and 20% aok, since aoa has some bonds it is around 75/25 or so. I'll let it ride out a year and see how it does compared to my 3 fund portfolio. This is in a tax advantage account and just $20k, hate how I say "just" since $20k is still a lot but that's about what my "toying" money for investment is.

If I remember at end of year to post back on how it does, I will, or if someone wants to know pm me
Title: Re: Anyone use iShare's core etfs?
Post by: skyrefuge on March 02, 2015, 05:13:02 PM
I got impatient

Well that's sure a dangerous trait for an investor to have.

Your guess about AOA being more diverse than Vanguard's LifeStrategy is incorrect. It's tough to compare exactly, but VASGX holds more than 9000 different stocks, which is as many as anyone. And it has an international bond component, which AOA doesn't have. Not to say that AOA isn't sufficiently diverse, just that it's wrong to think that it's more diverse than VASGX.

The main difference appears to be that AOA has a higher international stock allocation than VASGX, and the bond allocation is lower. This may make it slightly riskier than VASGX, which makes the returns look slightly different.

So if you wanted to use AOA rather than VASGX because you're sure that you needed that extra international stock exposure that AOA wasn't giving you, and you needed fewer bonds dragging down your stock returns, than, sure, I guess.

But then you go and cancel out that slightly riskier profile by mixing with bond-heavy AOK? Huh? What's the point of that?

You'll certainly do just fine with AOA, or VASGX, or any similar total-market fund. But you won't do fine with impulsively changing your investments to things you don't understand for reasons you can't define.