Comments on: I Share My Asset Allocation (as do 7 other Money Writers)

By: Lazy Man

Lazy Man — Wed, 30 Jul 2008 14:06:29 +0000

Not in years, since I opted into them. At the time they were very low cost funds. Most of the fund families I know well enough to know that they didn’t raise expenses much.

Anyway, I’m looking to roll them over into low-cost ETFs, when the market recovers. I don’t want to be out of the market in a transfer when a recovery happens. I’m content to wait it out a year or two if necessary.

By: Todd

Todd — Wed, 30 Jul 2008 12:57:12 +0000

Have you calculated your expense ratio to see where it stands? Just curious.

By: Super Saver

Super Saver — Tue, 29 Jul 2008 19:48:34 +0000

Lazy Man,

-7.22% return beats the S&P. Congratulations.

It seems your accounts have duplicated fund types, e.g. multiple small and mid cap funds. A simplification approach could be to use only one in each category of international, small cap, mid cap, growth etc.

By: Lazy Man

Lazy Man — Mon, 28 Jul 2008 21:56:37 +0000

The “Lazy” comes in the fact that I haven’t rolled these over into IRAs where I could consolidate with lower cost funds. Each of these accounts represent the diversification I had at a point of time when choosing the funds. I rebalance occasionally, but I don’t go back re-investigate why I chose the funds. I do know that they expense ratios are amongst the lowest I can choose (again, short of rolling them over, which I explained).

I could do what the Travelin’ Man says, but it really only helps with my record keeping. If I shift all the money around, it’s still going to perform more or less the same. Plus I think that the small caps and international funds would have much lower overlap than say two S&P 500 funds. I really don’t mind being diversified across a few of them as long as it’s not costing me any more money (which it isn’t).

I think that KS largely has it right (perhaps the addition of other assets like bonds, real estate, commodities, etc. should be added in as well). Sometimes I think I could just diversify my whole stock portfolio in VEU and VTI and “Lazy” around in a hammock. ;-)

By: KS

KS — Mon, 28 Jul 2008 21:35:06 +0000

I think this asset allocation thing is a lot over done. By its very defination using a mutual fund allocates your assets 1) to diffrent industries 2) to diffrent compaies. Each mutual fund typically has atleast 10 industries and 30 compnies (a lot more for the larger funds). A protfolio that has a small, medium and large company fund and an international fund is initslef sufficently allocated.

By: The Travelin' Man

The Travelin' Man — Mon, 28 Jul 2008 20:46:08 +0000

Wow. You have a lot of different funds. That doesn’t seem like the “Lazy Man” way. It seems like there would be too many things to keep track of. I understand the need to remain diversified across all of your accounts, but couldn’t you allocate the percentages you want across all accounts? In other words, have your entire 20% allocation of international funds in one of your 401k accounts, have 15% small cap (or whatever you allocation is) in another account, etc. – all totaling your combined asset allocation, but using fewer funds?