Paul answers 12 questions from the AAII New York City Chapter October 2023

Meeting

The video can be watched here- https://www.youtube.com/watch?v=QjFlcDAlH1k

Paul's section begins at 08:40.

The following links are used in this presentation: Table B14B, ETF portfolios, and SPIVA Report

1. Do you recommend using index funds for international funds?
2. Since small cap value underperforms the S&P 500 for long periods of time, should SCV be avoided by those who are nearing retirement?
3. I don’t have small cap value available in my 401(k). Will a small cap blend fund have the same impact?
4. How can there be such radical return differences between the small cap value indexes?
5. Are you going to show risk-adjusted returns for the index funds? Treynor ratios? Sharpe ratios? Sortino ratios?
6. How does one juggle the choice between investing in a higher expense ratio ETF (example AVUV) compared to investing in a lower cost index fund? Would the decision be as simple as going with the lower cost fund?
7. If everyone invests in small cap value funds will that reduce the premium in the future?
8. Some say the SCV premium is declining because private equity companies are taking SCV companies private. Any truth to the comment?
9. How do I rebalance a target date fund and a small cap value fund? What gets rebalanced?
10. Please recap what the good, bad and ugly of small cap value funds and ETFs.
11. How long have you been aware of the small cap value premium? Did you know about it before they became popular?
12. Fidelity Freedom TDF 2035 has an expense ratio of .7%. When the expenses are that high does it change your recommendation of adding a small cap value fund?

12 Small Cap Value Q & A's