I like Bogle's "Little Book of Common Sense Investing"[0] a little more than the Bogleheads Guide, but they're both good :)
[1] https://investor.vanguard.com/mutual-funds/profile/VFIFX
[1]: https://earlyretirementnow.com/2017/09/13/the-ultimate-guide...
The bonds are going to really drag on your returns and since bonds don’t seem correlated with equities anymore, they might not even be an equity hedge. Risk parity portfolios are designed to solve this problem through leverage.
So while they all made money, the three portfolio made the least money. Unfortunately the Vanguard ETFs don't go back before the last recession, otherwise it would be interesting to see how the numbers invert.
You can backtest it there. BTW 100% stock will likely beat the stock+fund, but at the cost of higher volatility (which can be an issue if you need the money eg during retirement)
When people go all VTI, they tend to freak out when the market goes down, sell near the bottom and forget about it, only to buy it again after the value goes up.
In my case, I believe we're in a rising rate environment, therefore I'd rather not hold bonds; I'm realistically investing for my kids' consumption rather than our own (we have the basics well-covered already); VTSAX holds companies that have substantial outside the US exposure and most of my future expenses are tightly tied to the fortunes of the US economy.
If your timeline is > 35 years, you're in the US, and intending to stay in the US, I could argue that pure VTSAX is better. Any of them are better than a "professional" financial advisor, IMO.
If you put $10,000 in in 2012, and just invested in the S&P500, you'd have $23,046. If you just did VTI (Vanguard Total Stock Market), you'd have $22,754 (and VTSAX would be $22,731). If you did the recommended 3 stock portfolio (VTI 42%, VXUS 18%, and BND 40%) you'd have $16,668.
So while they all made money, the three stock portfolio made the least money. Unfortunately the Vanguard ETFs don't go back before the last recession, otherwise it would be interesting to see how the numbers invert, or if they do.
Looking at mutual funds over a period of years showed that very few of them even out-performed the market.
Almost all of those that did out-perform the market actually still lost out when the fund manager's percentage was figured in.
Fidelity Magellan Fund managed by Peter Lynch is one of the few exceptions where the fund not only outperformed the market but still did so after the fees.
(But then that is why you have heard of Fidelity Magellan Fund and Peter Lynch.)
Furthermore, as everyone jumped on Fidelity Magellan Fund it became too big and moved the market when it moved — and not in a beneficial way for the fund investors.
tl;dr: a monkey throwing a dart (assuming he charges a fee below 1%) will outperform most of the Wallstreet fund managers. Put your money in an index fund, let the algorithm spread your money/risk out and wait a few decades.
Can you summarize the biggest thing you learned from it?