Author Topic: MSCI ACWI IMI index tracking fund - low expense option in 401k  (Read 1327 times)

InTheSeam

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First time poster here. I have thoroughly enjoyed lurking throughout the forum as my wife and I embark to shed layers of ridiculousness from our lifestyle. My first draw to MMM was a concise article on index investing and the reviews on investment theory, etc. I've got a specific question:

I am new to the bogleheads / Vanguard style of index investing, but am starting to buy in. I am currently accumulating in my 401k at work, which obviously has limited options. My only equity fund choices with even reasonable expense ratios include a fund that tracks the MSCI ACWI IMI index (expense ratio of 0.06% -Sweet!) versus a Russell 3000 tracking fund (expense of 0.54 - WTF?!?) that would be balanced internationally by DODFX (0.64% ER). My hesitation to using the MSCI fund is the lack of information I have found on available ETF strategies that incorporate its use, and few funds that track it.

What am I missing here, as far as reasons to avoid it as my core 401k holding? Any fundamentals, as far as re-balancing goes, that would be 'off' due to holding a 'world stock' type all-in-one fund? Anyone use an MSCI ACWI fund as a core holding?

By the way - there are Target Date funds available, but I am currently looking to be 100% in equities, and even the longest horizon does not offer less than 5% in bonds / cash. We are maxing out Roths already, and I want to take full advantage of my tax advantaged options.
« Last Edit: June 20, 2015, 05:06:27 PM by WaffleHaus »

forummm

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Re: MSCI ACWI IMI index tracking fund - low expense option in 401k
« Reply #1 on: June 20, 2015, 05:02:38 PM »
MSCI ACWI IMI is a perfectly fine index, very diversified index and the ER is great. Sounds good to me.

Here's some more info on it if that helps you. Basically lots of great companies of all sizes.

https://www.msci.com/resources/factsheets/index_fact_sheet/msci-acwi-imi.pdf

InTheSeam

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Re: MSCI ACWI IMI index tracking fund - low expense option in 401k
« Reply #2 on: June 22, 2015, 01:07:23 PM »
Thanks for your input, forummm. I'll be hunting for more strategies that incorporate total market type funds to further understand the rebalancing effects within the fund itself.

forummm

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Re: MSCI ACWI IMI index tracking fund - low expense option in 401k
« Reply #3 on: June 22, 2015, 01:31:30 PM »
Thanks for your input, forummm. I'll be hunting for more strategies that incorporate total market type funds to further understand the rebalancing effects within the fund itself.

Not sure what you mean by that. Generally total market funds just buy and hold and don't do any trading (unless stocks are added or subtracted from the index--which doesn't happen very much--or there's a lot of buying and selling of the fund).