An "easy" way to invest in the right stock category.
Aug 21, 2024 16:32:40 GMT -5
graust and thomas like this
Post by Admin on Aug 21, 2024 16:32:40 GMT -5
Suppose you are someone who wants to make their life simple and invest in 1-3 stock funds.
Buffett said many times that his favorite index is the SP500 (SPY,VOO).
Bogle, the founder of the index funds and Vanguard, also liked the SP500 or the total stock index VTI. Later in life, Bogle claimed that adding international is OK too, AKA, VXUS at 20% maybe 30% of someone's stock portion.
You can stop reading right now and implement the above and go to sleep for several decades
But...
Since the above guys had a lot of influence on me and I think they are mostly right, I like to make changes:
1) I don't like static portfolio when markets say you are wrong.
2) Momentum works and why I want to use it.
3) VOO,VTI will always be your portfolio main index, they are the default. The minimum is 40% and the maximum is %100.
4) If VOO leads, we can invest all of it in VOO.
5) When VOO doesn't lead, VOO=40% and we must use 2 more indexes at 30% each.
6) Any time you have doubt, VOO can be 60-70% and the rest in 1-2 other indexes.
7) We are going to check every 4 months and make new decisions: around first week of March, July, and November.
8) We are going to use the following wide-range indexes: VOO, QQQ(or VUG), VTV(LC value), RWJ=SC revenue(it's better than IWM), VXUS(international index), VWO (emerging market).
Let's check the last 5 years, starting with 2020
2020
March 05: First US chart for VOO,QQQ,VTV,RWJ. 4 Months chart(schrts.co/XAbAMRhM) + 8 months chart shows that QQQ leads, followed by VOO
Then, 4 months chart of VOO,VXUS,VWO (schrts.co/MfnhShHA) + 8 month chart show that VOO leads
Invest 70-100% VOO or 70/30 VOO,QQQ
July 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/jCRMibYj) + 8 months chart shows that QQQ leads, followed by VOO
Then, 4 months chart of VOO,VXUS,VWO (schrts.co/PTIgcFTj) + 8 month chart show that VOO leads
Invest 70-100% VOO or 70/30 VOO,QQQ
Nov 05: First US chart for VOO,QQQ,VTV,RWJ.4 months chart(schrts.co/fhqhbYkG) + 8 months chart show a conflict. For 4 months RWJ leads, QQQ,VOO. For 8 months QQQ,VOO.
Then, 4 months chart of VOO,VXUS,VWO + adding QQQ RWJ (schrts.co/EnNIRIcw) + 8 month chart show that VOO leads
Invest 60% VOO, 20% in each QQQ RWJ.
2021
March 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/piKPWjUj) + 8 months chart shows that RWJ leads, followed by VTV, VOO
Then, 4 months chart of RWJ,VTV,VXUS,VWO (schrts.co/ufcEKjMc) + 8 month chart show that RWJ leads, followed by VTV
Invest 40% VOO, 30% in each VTV, RWJ (pay attention, we have used RWJ=SC for 8 months already)
July 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(https://schrts.co/SgiuBAkb) + 8 months chart show that QQQ leads, followed by VOO leads for 4 months but RWJ for 8
Then, 4 months chart of VOO,VXUS,VWO (schrts.co/QdiGnHfe) + 8 month chart shows that VOO leads
Since 4 months rules = change in momentum, I'm back with...Invest 70-100% VOO or 70/30 VOO,QQQ
Nov 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/gxGIAnWE) + 8 months chart show that QQQ,VOO mostly lead.
Then, 4 months chart of VOO,VXUS,VWO + adding QQQ RWJ (schrts.co/xMPuHzgG) + 8 month chart shows that VOO leads
Invest 70-100% VOO or 70/30 VOO,QQQ.
2022
March 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/DxidMbWP) + 8 months chart. We have a conflict for 4 months VTV=value lead followed by RWJ. For 8 months, VTV leads, followed by VOO
4 months chart of VTV,VXUS,VWO (https://schrts.co/MRmvswRR) + 8 month chart show that VTV leads
Invest 60% VOO, 20% in each VTV,RWJ
July 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/gfCVeXKx) + 8 months chart show that VTV leads, followed by VOO
Then, 4 months chart of VTV,VXUS,VWO (schrts.co/SFIvMQXs) + 8 month chart shows that VTV leads
Invest 50% VOO, 50% VTV.
Nov 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/mfmrzEuT) + 8 months chart show that VTV,RWJ lead.
Then, 4 months chart of VTV,RWJ,VXUS,VWO + adding QQQ RWJ () + 8 month chart shows that VTV,RWJ lead
Invest 60% VOO, 20% in each VTV,RWJ.
2023
March 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/hJVzaPgt) + 8 months chart. We have a conflict for 4 months QQQ,RWJ lead, then VOO, and VTV lags. For 8 months, RWJ,VTV lead.
4 months chart of QQQ,RWJ,VXUS,VWO (schrts.co/HyYXRMNA) + 8 month chart show that RWJ leads for 8 months but VXUS leads by a small margin for the first time in years followed by RWJ.
Remember, the last 4 months have more weight.
Invest 60% VOO, 20% in each VXUS,RWJ
July 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/jgeIhbWJ) + 8 months chart show that QQQ leads by a huge margin, followed by VOO
Then, 4 months chart of VOO,QQQ,VXUS,VWO (schrts.co/cVvZPNWd) + 8 month chart shows that US back in charge with QQQ,VOO
Invest 70-100% VOO or 70/30 VOO,QQQ.
Nov 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/PSMdCYpP) + 8 months chart show that QQQ,VOO lead.
Then, 4 months chart of QQQ,VOO,VXUS,VWO + adding QQQ RWJ (schrts.co/YDUqAAmt) + 8 month chart shows that VTV,RWJ lead
Invest 70-100% VOO or 70/30 VOO,QQQ.
2024
March 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/ehpsKEBk) + 8 months chart show that QQQ,VOO lead.
4 months chart of QQQ,VOO,VXUS,VWO (schrts.co/UyZfzybI) + 8 month chart show that QQQ,VOO lead
Invest 70-100% VOO or 70/30 VOO,QQQ.
July 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/pIkVAvXW) + 8 months chart show that that QQQ,VOO lead.
Then, 4 months chart of VOO,QQQ,VXUS,VWO (schrts.co/VBPXZqCe) + 8 month chart show in that QQQ,VOO lead
Invest 70-100% VOO or 70/30 VOO,QQQ.
The above was an easy exercise how to implement it and it takes about 5 minutes every 4 months. It makes sure the investor is in the right categories and using just 2-3 funds. No guessing is needed, no complicated charts, timing, and trading. Valuation don't matter; only current markets performance matter.
My original system used managed funds instead, with better risk/reward
Buffett said many times that his favorite index is the SP500 (SPY,VOO).
Bogle, the founder of the index funds and Vanguard, also liked the SP500 or the total stock index VTI. Later in life, Bogle claimed that adding international is OK too, AKA, VXUS at 20% maybe 30% of someone's stock portion.
You can stop reading right now and implement the above and go to sleep for several decades
But...
Since the above guys had a lot of influence on me and I think they are mostly right, I like to make changes:
1) I don't like static portfolio when markets say you are wrong.
2) Momentum works and why I want to use it.
3) VOO,VTI will always be your portfolio main index, they are the default. The minimum is 40% and the maximum is %100.
4) If VOO leads, we can invest all of it in VOO.
5) When VOO doesn't lead, VOO=40% and we must use 2 more indexes at 30% each.
6) Any time you have doubt, VOO can be 60-70% and the rest in 1-2 other indexes.
7) We are going to check every 4 months and make new decisions: around first week of March, July, and November.
8) We are going to use the following wide-range indexes: VOO, QQQ(or VUG), VTV(LC value), RWJ=SC revenue(it's better than IWM), VXUS(international index), VWO (emerging market).
Let's check the last 5 years, starting with 2020
2020
March 05: First US chart for VOO,QQQ,VTV,RWJ. 4 Months chart(schrts.co/XAbAMRhM) + 8 months chart shows that QQQ leads, followed by VOO
Then, 4 months chart of VOO,VXUS,VWO (schrts.co/MfnhShHA) + 8 month chart show that VOO leads
Invest 70-100% VOO or 70/30 VOO,QQQ
July 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/jCRMibYj) + 8 months chart shows that QQQ leads, followed by VOO
Then, 4 months chart of VOO,VXUS,VWO (schrts.co/PTIgcFTj) + 8 month chart show that VOO leads
Invest 70-100% VOO or 70/30 VOO,QQQ
Nov 05: First US chart for VOO,QQQ,VTV,RWJ.4 months chart(schrts.co/fhqhbYkG) + 8 months chart show a conflict. For 4 months RWJ leads, QQQ,VOO. For 8 months QQQ,VOO.
Then, 4 months chart of VOO,VXUS,VWO + adding QQQ RWJ (schrts.co/EnNIRIcw) + 8 month chart show that VOO leads
Invest 60% VOO, 20% in each QQQ RWJ.
2021
March 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/piKPWjUj) + 8 months chart shows that RWJ leads, followed by VTV, VOO
Then, 4 months chart of RWJ,VTV,VXUS,VWO (schrts.co/ufcEKjMc) + 8 month chart show that RWJ leads, followed by VTV
Invest 40% VOO, 30% in each VTV, RWJ (pay attention, we have used RWJ=SC for 8 months already)
July 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(https://schrts.co/SgiuBAkb) + 8 months chart show that QQQ leads, followed by VOO leads for 4 months but RWJ for 8
Then, 4 months chart of VOO,VXUS,VWO (schrts.co/QdiGnHfe) + 8 month chart shows that VOO leads
Since 4 months rules = change in momentum, I'm back with...Invest 70-100% VOO or 70/30 VOO,QQQ
Nov 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/gxGIAnWE) + 8 months chart show that QQQ,VOO mostly lead.
Then, 4 months chart of VOO,VXUS,VWO + adding QQQ RWJ (schrts.co/xMPuHzgG) + 8 month chart shows that VOO leads
Invest 70-100% VOO or 70/30 VOO,QQQ.
2022
March 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/DxidMbWP) + 8 months chart. We have a conflict for 4 months VTV=value lead followed by RWJ. For 8 months, VTV leads, followed by VOO
4 months chart of VTV,VXUS,VWO (https://schrts.co/MRmvswRR) + 8 month chart show that VTV leads
Invest 60% VOO, 20% in each VTV,RWJ
July 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/gfCVeXKx) + 8 months chart show that VTV leads, followed by VOO
Then, 4 months chart of VTV,VXUS,VWO (schrts.co/SFIvMQXs) + 8 month chart shows that VTV leads
Invest 50% VOO, 50% VTV.
Nov 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/mfmrzEuT) + 8 months chart show that VTV,RWJ lead.
Then, 4 months chart of VTV,RWJ,VXUS,VWO + adding QQQ RWJ () + 8 month chart shows that VTV,RWJ lead
Invest 60% VOO, 20% in each VTV,RWJ.
2023
March 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/hJVzaPgt) + 8 months chart. We have a conflict for 4 months QQQ,RWJ lead, then VOO, and VTV lags. For 8 months, RWJ,VTV lead.
4 months chart of QQQ,RWJ,VXUS,VWO (schrts.co/HyYXRMNA) + 8 month chart show that RWJ leads for 8 months but VXUS leads by a small margin for the first time in years followed by RWJ.
Remember, the last 4 months have more weight.
Invest 60% VOO, 20% in each VXUS,RWJ
July 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/jgeIhbWJ) + 8 months chart show that QQQ leads by a huge margin, followed by VOO
Then, 4 months chart of VOO,QQQ,VXUS,VWO (schrts.co/cVvZPNWd) + 8 month chart shows that US back in charge with QQQ,VOO
Invest 70-100% VOO or 70/30 VOO,QQQ.
Nov 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/PSMdCYpP) + 8 months chart show that QQQ,VOO lead.
Then, 4 months chart of QQQ,VOO,VXUS,VWO + adding QQQ RWJ (schrts.co/YDUqAAmt) + 8 month chart shows that VTV,RWJ lead
Invest 70-100% VOO or 70/30 VOO,QQQ.
2024
March 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/ehpsKEBk) + 8 months chart show that QQQ,VOO lead.
4 months chart of QQQ,VOO,VXUS,VWO (schrts.co/UyZfzybI) + 8 month chart show that QQQ,VOO lead
Invest 70-100% VOO or 70/30 VOO,QQQ.
July 05: First US chart for VOO,QQQ,VTV,RWJ. 4 months chart(schrts.co/pIkVAvXW) + 8 months chart show that that QQQ,VOO lead.
Then, 4 months chart of VOO,QQQ,VXUS,VWO (schrts.co/VBPXZqCe) + 8 month chart show in that QQQ,VOO lead
Invest 70-100% VOO or 70/30 VOO,QQQ.
The above was an easy exercise how to implement it and it takes about 5 minutes every 4 months. It makes sure the investor is in the right categories and using just 2-3 funds. No guessing is needed, no complicated charts, timing, and trading. Valuation don't matter; only current markets performance matter.
My original system used managed funds instead, with better risk/reward