Risk Parity Radio
Episode 362: Considering International Stock Funds, DBMF Benchmarks, Reviewing a 70/20/10 Portfolio And More Trogdor!
Aug 22, 2024
Robert, an expert in international stock funds, Jamie, an inquisitive Boglehead, and Richard, a proponent of early retirement, dive into critical investment strategies. They discuss the limitations of traditional portfolios, specifically the Boglehead approach. The trio examines the nuances of diversification, highlighting the unexpected similarities between international and U.S. stocks. They also review a unique 70/30/10 risk-parity portfolio, tackling real-world concerns while offering valuable insights on transitioning towards retirement investing.
34:12
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Quick takeaways
- Adjusting strategies during the accumulation phase is crucial, especially in evaluating the necessity of bond funds for upcoming retirees.
- International stock funds often lack true diversification, making targeted value and small-cap options a better choice for investors.
Deep dives
Optimal Investment Strategies for Accumulation
The discussion emphasizes the importance of adjusting investment strategies during the accumulation phase, particularly regarding bond funds. An example is provided by a listener who has been using a traditional Bogleheads portfolio but questions the necessity of bonds given their upcoming retirement timeline. The host suggests that maintaining a bond fund may not be optimal during accumulation, especially when the listener is inclined to shift from bonds to stocks in anticipation of potential market downturns. Instead of market timing, the host advocates for a scheduled approach to reallocating investments, promoting a more psychologically comfortable transition.
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