thanks for the charts. but i agree with Northern Flicker. Really what we want to do here is look at VTINX with its short-term TIPS allocation vs other funds from a DRAWDOWN perspective- i.e. the usual growth charts are not really what we are after here.Sure, but that's sort of like saying "Our kids need vitamin C so we put always put a snack bag of potato chips in their lunchbox." Potato chips do contain vitamin C, but it's about 10% of the amount they need. Vanguard presents an argument for including short-term TIPS, but, as my chart above shows,thanks for mentioning the white paper. i think this is it?
https://institutional.vanguard.com/cont ... Online.pdf
cheers,
grok![Image]()
Blue = approximately equivalent to VTINX
Red = Without using any short-term TIPS, all Total Bond
the amount they use is so small it barely moves the needle. It's certainly not enough to do the job they've assigned for it.
I've taken a stab at this for a $10k starting value, comparing VTINX (30% stocks) to a 50/50 blend of two of the vanguard life strategy funds: VASIX (20% stocks) and VSCGX (40% stocks) over the past 5 years, using a 3.44% annual withdrawal rate (see my post above):
viewtopic.php?p=8137665#p8137665
First the table for VASIX/VSCGX
Code:
qtrretincomeport value2019.752.39%na10,0002020.00-5.51%88.0610,1512020.257.92%82.499,5102020.502.98%88.2610,1742020.755.11%90.1010,3872021.00-0.67%93.8910,8242021.253.17%92.4710,6602021.50-0.32%94.5810,9032021.751.78%93.4710,7752022.00-5.64%94.3210,8732022.25-7.99%88.2310,1712022.50-5.01%80.489,2782022.753.73%75.798,7372023.004.44%77.948,9852023.251.35%80.709,3032023.50-2.90%81.089,3472023.757.97%78.068,9992024.001.89%83.569,6322024.250.65%84.409,7302024.505.52%84.229,7082024.750.00%88.1010,156Code:
Qtr beginnreturnincomevalue2,019.752.60%na10,0002,020.00-5.91%88.2410,1722,020.257.84%82.319,4882,020.503.12%88.0010,1442,020.755.15%89.9610,3712,021.000.08%93.7810,8112,021.253.23%93.0510,7272,021.50-0.13%95.2310,9782,021.752.01%94.2910,8692,022.00-4.77%95.3610,9922,022.25-7.37%90.0310,3782,022.50-4.64%82.679,5312,022.753.74%78.169,0102,023.004.23%80.399,2672,023.251.36%83.079,5762,023.50-2.35%83.479,6222,023.757.34%80.819,3152,024.002.09%85.999,9132,024.250.89%87.0410,0332,024.505.12%87.0610,0362,024.75na90.7310,4591) Average Quarterly income: VTINX = $87.48 vs. VASIX/VSCGX = $86.01 so VTINX is 1.7% higher
2) Std. Dev. of Quarterly income: VTINX = 5.30 vs VASIX/VSCGX = 5.97 so VTINX is 12% lower
3) Terminal value: VTINX = 10,459 vs VASIX/VSCGX = 10,156 so VTINX is 3.0% higher
now granted these differences are small. but i would argue they are all material and beneficial. Vanguard set out to build a fund that was a bit better for retirees in their drawdown phase. the last 5 years provide one stress test for their approach with the pandemic and the "great inflation"
So far so good.
cheers,
grok
Statistics: Posted by grok87 — Thu Dec 05, 2024 6:26 am — Replies 67 — Views 4391