May 26, 2014: In Praise Of Low Cost Core Asset Class Based Portfolios
by MyPlanIQ | May 27, 2014 | Asset-Allocation, Bonds, Economy, Feature, Gold, Headline, Income, Inv, Investments, IRA, Markets, Mutual-Funds, newsletter, Portfolios, Retirement |
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In praise of low cost core asset class based portfolios
We are a firm believer in simplicity. Many greatest inventions or scientific discoveries in human history lie in some simple and elegant concepts. This is also true in investing. We have always advocated Simpler Is Better (SIB) portfolios. These portfolios are constructed out of a list of low cost major asset class index funds or ETFs. The major asset classes include the following:
- US stocks
- Developed countries stocks
- Emerging market stocks
- REITs (US or Global)
- US total bonds
With the advent of low cost index mutual funds such as Vanguard funds and ETFs, investors now can use these broad base liquid funds to have exposure to the above asset classes. The most representative plans are
In Strategic Asset Allocation portfolios, this concept of low cost index fund based diversified portfolios has been discussed and advocated widely. The famous lazy portfolios (see, for example, some of those covered on Lazy Portfolios page) are one types of examples.