Vanguard portfolio advise

**Jluke** · 12-29-2023, 02:22 PM

I think you’re fine as is on international.

of course I have 0% international

**kork13** · 12-29-2023, 07:31 PM

I'm my unprofessional opinion, the diversification benefit of holding international stocks have greatly eroded over time. Many of the international stocks that vanguard would have you in follow the same market forces as our domestic stocks (due to significant market globalisation). Thus, they're unable to provide a meaningful R2 in your portfolio to counteract domestic stocks losses, which is the point of diversification. Besides, over the course of my >15 years investing to some degree in international stocks, they have consistently underperformed domestic stocks by at least 2-3% every year.

So I've lost faith in them, and only keep a token amount in international stocks -- maybe 5% of our total portfolio. You can choose to include them or forsake them ... But I most assuredly would NOT suggest allocating 35-55% of your stock exposure to internationals. That's just bonkers.

**aim-high** · 12-30-2023, 04:51 AM

Thanks kork13

**disneysteve** · 12-30-2023, 06:16 AM

I do believe in having intl exposure for diversification because something like 40-45% of the global stock market capitalization is outside of the US. By going 100% domestic, you're ignoring 40+% of the world market. We live in a global economy so why would you ignore the global market? That said, I think 35-55% intl is a lot. If you're at 33% in the one account (meaning your overall % is lower than that) and happy with that, I think that's fine.

**aim-high** · 12-30-2023, 06:27 AM

disneysteve If i combine both the retirement accounts + brokerage account, vanguard tells me I have funds in 93% domestic stocks and 7% in International stocks. Any strong reason to increase the overall % in international stocks ?

**disneysteve** · 12-30-2023, 07:08 AM

Originally posted by aim-high View Post

disneysteve If i combine both the retirement accounts + brokerage account, vanguard tells me I have funds in 93% domestic stocks and 7% in International stocks. Any strong reason to increase the overall % in international stocks ?

I think if you ask 10 people you’ll get 10 different answers. Strong reason? I don’t think so. I honestly don’t know what our international % is right now because we have an international fund but also have a global fund that includes both domestic and foreign stuff but I know it’s relatively low, like not over 10%.

**srblanco7** · 12-31-2023, 03:34 AM

Originally posted by aim-high View Post

I have a brokerage account in Vanguard and Retirement accounts consisting of Roth IRA + Rollover IRA. When I look at the composition of these account using the portfolio watch tool in Vanguard, here are the results

Brokerage account

100% in stocks
100% of it is in domestic stocks and 0% in International stocks

Retirement accounts

100% stocks
Out of the 100% stocks , 67% is in Domestic stocks and 33% in international stocks

Questions:

1. Brokerage account, I consider as short term so I want to be aggressive and make as much money as possible. However, should I consider diversification by putting some % in international stocks ?
2. Retirement account , I consider this long term. I dont want to touch this until retirement. Vanguard is recommending 35 % to 55% on foreign stocks but I have 33%. Should I increase international exposure to 35 to 55% ?

--Sunray

I don’t have a strong opinion on domestic vs international, though we’re heavily slanted to domestic given that most companies at this point operate globally and (i believe) a “heavy” international focus also brings more currency exchange rate risk. That being said, I was more struck that nobody has commented on the Brokerage Account. Not sure I’d be 100 percent in stocks and aggressively investing if you have a “short-term” focus for these funds.

**aim-high** · 12-31-2023, 10:19 AM

I have 100% in stocks in my brokerage account so i can aggressively grow the funds and use that funds if i need to buy a 2nd house. I do plan to monitor this account every quarter to rebalance as necessary

Vanguard portfolio advise