Some Portfolio strategies with ETFs

[CoachKandSportsguy]

For those looking to create portfolio strategies with ETFs to do your own portfolio management, here are some suggestions from a portfolio manager, in New England, who also happens to have a PhD in the topic.

Hedged
35% $LBAY
25% $VYM
20% $GOVT
20% $VIG
10% $JEPI

Semis/Energy FCF
40% $VTI
25% $COWZ
15% $SYLD
10% $FSELX (or $SOXX or $SMH w/o Fidelity)
10% $FSENX (or $XLE w/o Fidelity)

Total Market Index:
100% $VTI

S&P+EZ FCF
60% $SPY
25% $COWZ
15% $VUG

Dividend
35% $VYM
35% $SPYD
30% $JEPI

Pure Value
85% $VTV
15% $AVUV

100% Indexed
90% $VOO
10% $VBR

GARP - Growth at a Reasonable Price
60% $VOO
20% $SPGP
10% $VUG
10% $COWZ

Shareholder Yield
50% $SYLD
25% $COWZ
15% $VIG
10% $SDY

Barbell 1
50% $VOO
20% $QQQ
20% $AVUV
10% $VTV

Barbell 2
50% $VOO
20% $VUG
20% $VBR
5% $XLE
5% $XLK

120% Long
80% $VOO
10% $DDM 2x Dow
10% $SSO 2x S&P

[Babubhat]

A financial planner from the Villages of Parkwood was arrested on drunk driving charge after a hit-and-run crash at Wawa. From our favorite news site. The term financial planner is meaningless without superior credentials. Otherwise it’s a salesman

Maybe he can help. Lol.

Algorithms and hedge funds rule. 5 etfs should be sufficient for most. Note you need to be aware of risk involved in some listed here. Know your risk profile


For those looking to create portfolio strategies with ETFs to do your own portfolio management, here are some suggestions from a portfolio manager, in New England, who also happens to have a PhD in the topic.

Hedged
35% $LBAY
25% $VYM
20% $GOVT
20% $VIG
10% $JEPI

Semis/Energy FCF
40% $VTI
25% $COWZ
15% $SYLD
10% $FSELX (or $SOXX or $SMH w/o Fidelity)
10% $FSENX (or $XLE w/o Fidelity)

Total Market Index:
100% $VTI

S&P+EZ FCF
60% $SPY
25% $COWZ
15% $VUG

Dividend
35% $VYM
35% $SPYD
30% $JEPI

Pure Value
85% $VTV
15% $AVUV

100% Indexed
90% $VOO
10% $VBR

GARP - Growth at a Reasonable Price
60% $VOO
20% $SPGP
10% $VUG
10% $COWZ

Shareholder Yield
50% $SYLD
25% $COWZ
15% $VIG
10% $SDY

Barbell 1
50% $VOO
20% $QQQ
20% $AVUV
10% $VTV

Barbell 2
50% $VOO
20% $VUG
20% $VBR
5% $XLE
5% $XLK

120% Long
80% $VOO
10% $DDM 2x Dow
10% $SSO 2x S&P

[tophcfa]

I suppose if they are in tax deferred account they are OK, but I have found ETF’s to be a real pain in the a$$ come tax season.

[CoachKandSportsguy]

I suppose if they are in tax deferred account they are OK, but I have found ETF’s to be a real pain in the a$$ come tax season.

Toph,

can you elaborate on this issue, as I am wondering what I am missing. . .

thanks!

[Babubhat]

List of All ETFs - Exchange Traded Funds | ETF Database (https://etfdb.com/etfs/)

Research here. Tax implications can be diverse. Know what you are buying.

The number one mistake is not evaluating returns on a Risk Adjusted Basis. Otherwise it becomes gambling. Great when you win.

Read 22 people did the big leap when Luna crashed

[tophcfa]

Toph,

can you elaborate on this issue, as I am wondering what I am missing. . .

thanks!

Perhaps I am painting all ETF’s with a broad brush, but the couple that I have owned sell a portion of my shares every month to pay the management fees (unlike how mutual funds work) which generate 12 annual capital gains/losses per fund that have to be reported for tax purposes. These sales are considered non-covered shares which means the cost basis is not reported to either the ETF investors or the IRS. Instead, the burden of proving the correct cost basis falls on the ETF shareholders, which can be a major pain in the a$$ if you invest in the ETF during different time periods and/or automatically reinvest dividends and or income back into the fund. Because of the hassle/inconvenience of this along with the fact I can typically invest in mutual funds giving me substantially the same exposure, I won’t invest in ETF’s in a taxable account. Hopefully that explanation clarifies my previous statement.

[DAVES]

Perhaps I am painting all ETF’s with a broad brush, but the couple that I have owned sell a portion of my shares every month to pay the management fees (unlike how mutual funds work) which generate 12 annual capital gains/losses per fund that have to be reported for tax purposes. These sales are considered non-covered shares which means the cost basis is not reported to either the ETF investors or the IRS. Instead, the burden of proving the correct cost basis falls on the ETF shareholders, which can be a major pain in the a$$ if you invest in the ETF during different time periods and/or automatically reinvest dividends and or income back into the fund. Because of the hassle/inconvenience of this along with the fact I can typically invest in mutual funds giving me substantially the same exposure, I won’t invest in ETF’s in a taxable account. Hopefully that explanation clarifies my previous statement.

I believe this has been mentioned before. I used the information provided on my brokerage account. Perhaps, I end up paying a bit more tax. However, fighting with the IRS over some obscurity. Is it worth it? May I ask what does it come to on say 10,000 or whatever. Figuring to MY/OUR actual balance is then simple to do.

[billethkid]

A financial planner from the Villages of Parkwood was arrested on drunk driving charge after a hit-and-run crash at Wawa. From our favorite news site. The term financial planner is meaningless without superior credentials. Otherwise it’s a salesman

along with demonstrable portfolio performance/returns!

[retiredguy123]

Perhaps I am painting all ETF’s with a broad brush, but the couple that I have owned sell a portion of my shares every month to pay the management fees (unlike how mutual funds work) which generate 12 annual capital gains/losses per fund that have to be reported for tax purposes. These sales are considered non-covered shares which means the cost basis is not reported to either the ETF investors or the IRS. Instead, the burden of proving the correct cost basis falls on the ETF shareholders, which can be a major pain in the a$$ if you invest in the ETF during different time periods and/or automatically reinvest dividends and or income back into the fund. Because of the hassle/inconvenience of this along with the fact I can typically invest in mutual funds giving me substantially the same exposure, I won’t invest in ETF’s in a taxable account. Hopefully that explanation clarifies my previous statement.
I use Vanguard mutual funds. The only advantages I see with ETFs are that the management fees are lower and the ETFs can be sold more than once per day. But, Vanguard fees are so low that they are negligible, and I don't want to sell shares more than once per day. Also, I believe that mutual funds are more tax efficient because they attract more "buy and hold" investors. So, the mutual fund manager is not forced to sell individual stocks in the fund (a taxable event) as often to raise cash to pay investors when they sell shares. Also, I direct that any capital gain distributions and dividends be transferred into my money market account, not reinvested in additional shares. That way, I always have the exact same number shares in my mutual fund. Vanguard keeps track of the cost basis for all mutual funds. No need to calculate it yourself.

[Boomer]

Doesn't anybody buy just plain old stocks anymore?

Boomerosaurus

[tophcfa]

Doesn't anybody buy just plain old stocks anymore?

Boomerosaurus

That only works if one wants to put in the time and effort doing research and analysis in an attempt to pick individual stocks that will outperform market index funds with very low management fees. Most investors claim they are good at that, but very few actually are, unless they are privy to material inside information. Personally, after a long career as a portfolio manager, I prefer to put our portfolio on autopilot and spend my retirement time swimming, golfing, biking, etc…

[Kenswing]

Doesn't anybody buy just plain old stocks anymore?

Boomerosaurus
I do. I do. Actually bought some MMM this morning.

[Caymus]

I do. I do. Actually bought some MMM this morning.

The PFAS liability concerns me.

[Boomer]

Doesn't anybody buy just plain old stocks anymore?

Boomerosaurus

I do. I do. Actually bought some MMM this morning.


Hey Ken,

I have been visiting that one for the past few days. It is tempting, but I have not bought in yet. I have been in and out and in and out of MMM twice over the years with good returns.

You might want to visit LEG with me. They are an old dividend payer with consecutive increases in the div for more than 50 years. But they are getting pounded right now, perhaps due to the nature of their many pieces of the business.

The right dividends pay us to wait.

Patient Boomer, Manager of the Boomerfund :)

[Plinker]

along with demonstrable portfolio performance/returns!

It would be interesting to learn what an individual’s actual equity portion of their portfolio return has been, YTD, for those individuals who utilize “financial advisors” as compared to a benchmark ETF like the S&P 500. Obviously, on a percentage basis, not actual dollars. Then, add in AUM and other fees and see which ones come out on top.
Lots of people have glowing reviews of their advisor and there appears to be more of them in TV then pickle ball courts, but I would like to know which, if any, are real performers. Wouldn’t it be great to have a list of TV advisors and their respective YTD returns? Keep the “free” dinners and polo tickets and show me the returns.

[Boomer]

That only works if one wants to put in the time and effort doing research and analysis in an attempt to pick individual stocks that will outperform market index funds with very low management fees. Most investors claim they are good at that, but very few actually are, unless they are privy to material inside information. Personally, after a long career as a portfolio manager, I prefer to put our portfolio on autopilot and spend my retirement time swimming, golfing, biking, etc…


Hey! No need to go all judgey. The condescension in that post is amusing.....in the biz you were you say? Interesting, but no reason to take umbrage with investors who choose a different way.

Boomer

[Kenswing]

Hey Ken,

I have been visiting that one for the past few days. It is tempting, but I have not bought in yet. I have been in and out and in and out of MMM twice over the years with good returns.

You might want to visit LEG with me. They are an old dividend payer with consecutive increases in the div for more than 50 years. But they are getting pounded right now, perhaps due to the nature of their many pieces of the business.

The right dividends pay us to wait.

Patient Boomer, Manager of the Boomerfund :)

Love me the Dividend Aristocrats. I’m accumulating many of them at or near their 52 week low. I’m still a couple of years away from 60 so like you I’ll just sit back, relax and collect my dividends.

I’ll take a look at LEG. Thanks.

[retiredguy123]

Doesn't anybody buy just plain old stocks anymore?

Boomerosaurus
I have never purchased an individual stock, only mutual funds. I believe in investing in the broad stock market indexes, but I never considered individual stock ownership to be anything like being a part owner in a successful company.

For example, McDonald's sells millions of hamburgers every day and they make money on every one of them. So, why does their stock value go down when the overall stock market goes down?

[valuemkt]

Interesting choice of ETFs.. i own some of them .. Most have gotten murdered along with the market. ETFs are not a problem re tax time. MLPs .. which generate K-1's give some people agita, and give tax preparers second homes and boats because folks don;t like to mess with them. ETFs can invest in MLPs, which is perhaps how the confusion started. Regarding the market in general, I like Dennis Gartman's line: In a bear market, he who loses the least wins. Re hiring an advisor who has a PHD, I could care less. There are plenty of academically brilliant people who don;t have an ounce of common sense. Were I to hire a financial advisor again (which I wont) I would go for a battle and time tested person who has successfully weathered ups and downs vs someone with academic credentials..

[Boomer]

Interesting choice of ETFs.. i own some of them .. Most have gotten murdered along with the market. ETFs are not a problem re tax time. MLPs .. which generate K-1's give some people agita, and give tax preparers second homes and boats because folks don;t like to mess with them. ETFs can invest in MLPs, which is perhaps how the confusion started. Regarding the market in general, I like Dennis Gartman's line: In a bear market, he who loses the least wins. Re hiring an advisor who has a PHD, I could care less. There are plenty of academically brilliant people who don;t have an ounce of common sense. Were I to hire a financial advisor again (which I wont) I would go for a battle and time tested person who has successfully weathered ups and downs vs someone with academic credentials..



I don’t know who Dennis Gartman is, but I really like that line of his you quoted. “In a bear market, he (or she :) ) who loses the least wins.”

Boomer

[DAVES]

I use Vanguard mutual funds. The only advantages I see with ETFs are that the management fees are lower and the ETFs can be sold more than once per day. But, Vanguard fees are so low that they are negligible, and I don't want to sell shares more than once per day. Also, I believe that mutual funds are more tax efficient because they attract more "buy and hold" investors. So, the mutual fund manager is not forced to sell individual stocks in the fund (a taxable event) as often to raise cash to pay investors when they sell shares. Also, I direct that any capital gain distributions and dividends be transferred into my money market account, not reinvested in additional shares. That way, I always have the exact same number shares in my mutual fund. Vanguard keeps track of the cost basis for all mutual funds. No need to calculate it yourself.

Truth we have so much information that I think most of us are confused. MY OPINION, the big three low cost brokerages are Fidelity, T. Rowe Price and Vanguard. I have accounts with all three. Advice is often put it all together. But, advice is also be diversified. Is that not having more than one brokerage account? I think it is. Vanguard offers Admiralty shares in many/most of their funds, With a balance of 50,000 plus management fees drop by roughly 30%, Fidelity for a long time denied this exists and they will not allow you to buy Admiralty shares in a Fidelity account. T. Rowe Price has come up with a similar plan reduced management fees by 20-30% on many/most funds with a balance of roughly 50,000.
Far as fidelity, a big plus, unlike the others with mon to fri 9-5 hours you can reach PEOPLE not a COMPUTER 24 hours a day seven days a week. The Villages they have an office in Lake Sumter a golf cart ride away for many of us. Fidelity now has no commission trades if you do on line trading. I like the Fidelity statement the best-perhaps because I do most of my trading there and I am more used to it.

[Michael G.]

I really couldn't add anything to this discussion cuz I'd have any my $$$$ in the back yard in one of our coffee cans
at 22814 SW 145th st.