Author Topic: Thoughts on Vanguard US/International Email  (Read 3178 times)

FastStache

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Thoughts on Vanguard US/International Email
« on: March 10, 2015, 08:22:36 AM »
I got an email saying Vanguard is going to increase their international exposure in their retirement funds.

Stocks
From 30% to 40%

Bonds
From 20% to 30%

I currently sit at about 15-20% international.

Does this reflect the fact that Vanguard expects more growth internationally or do you want to damper some of the volatility of their stocks? What do others have internationally and does Vanguard making a change like this make you want to reevaluate your international exposure?

tj

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Re: Thoughts on Vanguard US/International Email
« Reply #1 on: March 10, 2015, 10:09:44 AM »
As far as I remember, their logic was that the cost of international investing is going down. They are basicaly moving towards a global portfolio. Wouldn't be surprised to see the LifeStrategy & Target Retirement funds use Total World instead of the individual domestic and international funds eventually.

forummm

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Re: Thoughts on Vanguard US/International Email
« Reply #2 on: March 10, 2015, 10:30:06 AM »
If you want to own stocks based on market weight, then you should be majority international. There may be other reasons you don't want to have that much exposure (currency risk, political risk, slightly higher fees). But if you look at Japan as one example, I think it's crazy to be 100% in just one country. I'm personally at 60 US/40 Intl. I think Vanguard is moving in the right direction. And I'm glad they are, since it will continue to drop the fees on their intl funds (which are mostly pretty low already) as they do more volume.

FastStache

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Re: Thoughts on Vanguard US/International Email
« Reply #3 on: March 11, 2015, 09:09:20 AM »
What is the stock split based on market weight?

tj

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Re: Thoughts on Vanguard US/International Email
« Reply #4 on: March 11, 2015, 09:26:02 AM »
What is the stock split based on market weight?

Right now its about 52 US/48 International accordign to Vanguard Total World Stock Market fund.

Indexer

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Re: Thoughts on Vanguard US/International Email
« Reply #5 on: March 11, 2015, 04:16:10 PM »
1.  They are moving in the right direction towards the global allocation and we are a global market now.
2.  Costs have come down to do it, and other countries are getting better at regulating their markets so you actually know what you are investing in.  Exception:  China.  Accounting in China is more of an 'art' than 'science.' 

3.  Its a good time to do it.  There is a pretty big premium in terms of valuations for domestic over international.  Its primarily because of all the bad news internationally lately, but if you are going to shift more of the portfolio to international you might as well do it when its cheap(er).

lovesasa

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Re: Thoughts on Vanguard US/International Email
« Reply #6 on: March 12, 2015, 12:59:27 AM »
1.  They are moving in the right direction towards the global allocation and we are a global market now.
2.  Costs have come down to do it, and other countries are getting better at regulating their markets so you actually know what you are investing in. Exception:  China.  Accounting in China is more of an 'art' than 'science.'

I LOLed. This x1000.

3.  Its a good time to do it.  There is a pretty big premium in terms of valuations for domestic over international.  Its primarily because of all the bad news internationally lately, but if you are going to shift more of the portfolio to international you might as well do it when its cheap(er).

Yes. Buy low!

innerscorecard

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Re: Thoughts on Vanguard US/International Email
« Reply #7 on: March 12, 2015, 02:59:09 AM »
Vanguard recommends a high international bond allocation: therefore Vanguard had always recommended a high international bond allocation.

A large part of the investing literature of five years was now completely obsolete. Reports and records of all kinds, newspapers, books, pamphlets, YouTube videos, podcasts, blog posts all had to be rectified at lightning speed. Although no directive was ever issued, it was known that the chiefs of the Department intended that within one week no reference to the old asset allocation, or the underweighting of international assets, should remain in existence anywhere. The work was overwhelming, all the more so because the processes that it involved could not be called by their true names.

NoraLenderbee

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Re: Thoughts on Vanguard US/International Email
« Reply #8 on: March 12, 2015, 03:02:13 PM »
Vanguard recommends a high international bond allocation: therefore Vanguard had always recommended a high international bond allocation.

A large part of the investing literature of five years was now completely obsolete. Reports and records of all kinds, newspapers, books, pamphlets, YouTube videos, podcasts, blog posts all had to be rectified at lightning speed. Although no directive was ever issued, it was known that the chiefs of the Department intended that within one week no reference to the old asset allocation, or the underweighting of international assets, should remain in existence anywhere. The work was overwhelming, all the more so because the processes that it involved could not be called by their true names.

Thank good ness we have the Party Vanguard to take care of us!