Vanguard Diehards

Re: Poll: International Allocation for 2008

benhur — Sat, 22 Dec 2007 19:28:25 GMT

International is 50% of my equity, and 45% of my total portfolio.

My international exposure is 1/3 Europe, 1/3 Pacific, and 1/3 Emerging markets.

These weightings are not changing for 2008 - they have been in my IPS since I set it several years ago.

Re: Poll: International Allocation for 2008

Bigla — Sat, 22 Dec 2007 18:40:36 GMT

Out of my equity portfolio, I have 22.5% in Int'l plus 6.5% in EM. I don't plan on changing thid for 08'.

Larry

Re: Poll: International Allocation for 2008

minesweep — Sat, 22 Dec 2007 00:21:47 GMT

I expect to keep my total international exposure at 25% of my total portfolio.

A public-opinion poll is no substitute for thought - Warren Buffet

Mike K

Re: Poll: International Allocation for 2008

coywesley — Fri, 21 Dec 2007 23:02:24 GMT

Re: Ted Aronson Portfolio.......20% EM.........Wow!

Is this one of the portfolios that is tracked monthly by madsinger here on the Vanguard Fund Family Forum?

Re: The Dollar.......I was just reading an article last night, that a reversal in the fall of the dollar may have already started. However, that may only be short lived. If not, that may put a big "ouch" in many people's portfolios, who have significantly increased their international allocations lately. Let's hope not.

Coy

Re: Poll: International Allocation for 2008

Avilynn — Fri, 21 Dec 2007 22:46:06 GMT

Coy, I manage about six portfolios for ages 70+, 60+, 45, 40, 35, and 30. IMO, it has also to do with this parameter. But overall, I agree with Larry S as to 30% of equity. For those in the accumulation stages I like Ted Aronson's Lazy Portfolio allocation as follows:

Ted Aronson (AJO Partners)

- 20% in Vanguard Emerging Markets Stock Index (VEIEX)
- 15% in Vanguard 500 Index (VFINX)
- 15% in Vanguard Pacific Stock Index (VPACX)
- 10% in Vanguard Extended Market Index (VEXMX)
- 10% in Vanguard Inflation-Protected Securities (VIPSX)
- 5% in Vanguard European Stock Index (VEURX)
- 5% in Vanguard High-Yield Corporate (VWEHX)
- 5% in Vanguard Long-Term U.S. Treasury (VUSTX)
- 5% in Vanguard Small Cap Growth (VISGX)
- 5% in Vanguard Small Cap Value Index (VISVX)
- 5% in Vanguard Total Stock Market Index (VTSMX)
-

Larry Swedroe on it (DEC 2007):

Q: Should the decline in the dollar affect our current investing decisions, and if so, how?

A: Simple answer is NO. And the reason is that would be making the mistake of confusing information with knowledge you can use to generate excess profits. Put simply, if you know something the odds are great that the market also knows it and thus has already incorporated that information into prices. Thus it is too late to act.

The time to act is when you are designing your investment plan, an asset allocation table. And that should include a large allocation to international stocks. That will provide the diversification benefit you are looking for, diversifying the economic and political risks of US stocks. I recommend that everyone should have at least 30% of their equities in international stocks, with as much as 50 percent, which is my own allocation.

Re: Poll: International Allocation for 2008

diasurfer — Fri, 21 Dec 2007 21:04:14 GMT

No changes to

45% International Equity

45% Domestic Equity

10 % bonds

Re: Allocation whimsy

tnlsea — Fri, 21 Dec 2007 20:15:50 GMT

statsguy:

Jerryc... you are right about changing allocations.
When you read conversations you see that recommendations for Intl have run the gamut from 0- 50+%. In the good old days, many would argue that Bogle says 20% max and heck you get plenty of international exposure from companies like GE, COKE, etc that get most of their profits from overseas. In the last year or so suggested allocations have predominately been at the higher end.
Same with REITs. Is anyone still suggesting greater than 10% allocations to REITs?
Same with PCRIX/VGPMX...
If Growth beats value the next few years you will see folks begin to talk about growth tilting.

And there hasn't been much talk about Janus funds recently either.

- Tom

Re: Poll: International Allocation for 2008

coywesley — Fri, 21 Dec 2007 20:11:33 GMT

Avilynn

I just use the M* X-Ray. Despite it's flaws and quirks, at the least you'll get a ballpark figure. Besides, if you have active funds, you only know what you Had as of the last fund report. On top of that, if you have Global Equity funds that can change allocations frequently, you are even further out in left field. My exact allocation is not all that important to me.

Coy

Re: Poll: International Allocation for 2008

Avilynn — Fri, 21 Dec 2007 19:55:47 GMT

Coy, how do you find out your international allocation? Since M* X-Ray refer to US companies as those that have their tax headquarters in the US, and not by their sales overseas, how do you decide?

What % of the revenue of S & P 500 is derived from overseas?

Allocation whimsy

statsguy — Fri, 21 Dec 2007 19:21:38 GMT

Jerryc... you are right about changing allocations.

When you read conversations you see that recommendations for Intl have run the gamut from 0- 50+%. In the good old days, many would argue that Bogle says 20% max and heck you get plenty of international exposure from companies like GE, COKE, etc that get most of their profits from overseas. In the last year or so suggested allocations have predominately been at the higher end.

Same with REITs. Is anyone still suggesting greater than 10% allocations to REITs?

Same with PCRIX/VGPMX...

If Growth beats value the next few years you will see folks begin to talk about growth tilting.

As to International, we used to allocate 20% to International. We lived and worked overseas in 1999 and 2000 and saw that there is a real world out there. I knew there were good companies overseas but somehow when you buy there products and see them advertised everyday you begin to realize that there is more to equities than just the US. That is when we decided to move towards putting half our our equities in Intl. We are not there, only about 40% of our equities are international. We are not going to make significant changes in this since we don't have significant new money to add right now.

Best
Stats

Re: Poll: International Allocation for 2008

mstargj — Fri, 21 Dec 2007 02:46:34 GMT

I have been 50% international. Lately boosted this to 55% because foreign markets are almost 60% of world index. Keeping 5% less than index due to possible rebalance benefits.

P.S. I am foreigner.

Re: Poll: International Allocation for 2008

Bernd — Fri, 21 Dec 2007 01:30:44 GMT

I have 40% of my equity in Vanguard International and European Stock Indexes, which is 20% of my portfolio. I have a 50% equity/ 50% US bonds and CDs split. I am 68 yrs old, wife is 63, and draw on SS and a fixed pension. My 50/50% moves around by 5 %, and I do not consider "drifting" by 5% to be market-timing.

I would not try to forecast the move of the Dollar. Right now I read it to be 20% undervalued in respect to the Euro, but we here have those huge budget and trade deficits, a war and now the credit crisis due to stupidity. I read that the dollar easily could go down some more.

Happy holidays!

Bernd

Re: Poll: International Allocation for 2008

maruyamakiyoshi — Thu, 20 Dec 2007 17:13:48 GMT

In my case, I don't do allocation between international and domestic (basically I don't do so called asset allocation since I haven't figured out what allocation is good for me). As of today, Fido analysis tool says I am 56.62% in international. This % may increase or decrease depending on next time I "rotate" fund(s) if I do. Today, almost all of funds I own are either international or global. I was about 40% international in 2006. FWIW. KM

Re: Poll: International Allocation for 2008

jerryc — Thu, 20 Dec 2007 15:42:29 GMT

“Do most investors on this board change their international stock allocations annually? “

I would guess that most investors on this board do not change their international stock allocations annually. However, it’s interesting to observe how the international stock allocations have changed over the last five years or so. When the US market was roaring along in the late 90s most were happy to heed the advice of Jack Bogle that little or no allocation to international was best (no more than 20%). I would say that over the last five years the broad consensus has shifted to allocations in excess of 20%, and that shift has occurred among the bulk of stay-the-course investors. Stay-the-course makes sense in general, but shifts to more international in those circumstances made even more sense in my opinion.

Re: Poll: International Allocation for 2008

statsguy — Thu, 20 Dec 2007 04:37:39 GMT

No change in allocations from 2007

30% Bonds
40% US
30% Intl