Happy to support, but I'd imagine the thread will either be very quiet (due to most investor leaning towards short term performance chasing from what I can tell) or random discussion on what exactly is Bogleism

For starters, I disagree with TS Alex's definition of Bogleheads, That section felt like it come from a Financially Independent, Retire Early thread.

The core idea behind Bogleheads IMO is leaning towards a few core investing principle:

1. Don't time the market. Invest as soon as you can.

2. Diversify with a low cost broad index fund.

3. Stay the course.

This post has been edited by Hoshiyuu: Feb 8 2022, 10:00 PM

Haha I got lucky and I got exposed to JL Collin's Simple Path to Wealth within half a year of me starting working, and quickly led myself to Bogleism after that. My biggest loss pre-Bogleism was 1k down the drain on Bursa, which I kept the money there to remind myself to never repeat this dumb mistake. Now just waiting for a true 30-50% crash to verify my conviction - I'd rather do that while young instead of 5 days into my retirement

My personal thanks to TS Alex too - your thread on CSPX/Irish-domiciled SP500 has lead to lots of great information and helped me towards buying VWRA - and the linked PDF "If you can" was one of the first things I've read early. In a way you contributed much to my investment journey.

Now with this initiative, hopefully in a few months we can be recognized as a local chapter properly as TS suggested. For those not sure what it is: https://www.bogleheads.org/wiki/Bogleheads%..._local_chapters

Confession time, I am a mudblood boglehead too

My broad index fund is at the moment 75% of my portfolio, 17% factor tilted US&International small-cap-value ETF, and 8% play money to satisfy my occasional non-boglehead urges

I want to think my core portfolio (92%) is almost bogle-halal though! Plus I have managed to stay the course, with no change to portfolio assets and their allocation so far.

This post has been edited by Hoshiyuu: Feb 9 2022, 01:42 PM

It's never too late!

There is a certain satisfaction of leaving money in places you don't want to pull away from, but focusing your deposit elsewhere where you have determined it's the right place you want your money to be in long term, and slowly seeing your "mistake" become smaller and smaller in your portfolio overtime.

Really reinforces your mentality to help with staying the course too!

This post has been edited by Hoshiyuu: Feb 9 2022, 01:47 PM

Since we are mostly Malaysians we don't even get to talk about roth backdoors, tax efficient accounts and 401ks.... We really do only have portfolio allocation and cheap brokers to talk about.

Wanna argue about how much bonds to have without disclosing information about our age and investment horizon? Can easily inflate the pages count of the thread!

Interactive Brokers for me, about 2USD per trade. I make a deposit every month so thats 2USD gone minimum, but I'm ready to pay an extra lunch every month just to be more "correlated" to the market so to say

You can cut down on FX cost by either using Wise to do MYR->USD directly (use to be highly not recommended, but people have reported good things about doing it via Wise Multi Currency Account) - or do something sillier like... buy RM1000 of stock on margin via IBKR (paying 1.58% p.a. margin loan fees), but deposit RM1000 into Versa/Stashaway Simple (~2% p.a. returns), every time your margin ratio reach ~1.25 (never higher than that), withdraw your MMF fully and one shot remit to CIMB-SG -> free deposit into IBKR -> convert to USD at the best FX rate possible, 2USD fee.

0.42% p.a. of discount on FX and transaction cost!

Please don't actually do this, I have not evaluated the additional FX risk introduced to this investment flow and the maximum possible fallout just to save LITERALLY less than 2 USD every few months

This post has been edited by Hoshiyuu: Feb 9 2022, 02:12 PM

Assuming equal weightage, I would recommend against it.

CSPX and QQQ overlaps too much. They overlap each other approximately 36% by market weight, and roughly 15% SPY is in QQQ and 77% of QQQ is also in SPY

CSPX then also overlaps VWRA by roughly 48% by market weight, ~5% with SPY, and 1% with QQQ.

You would be so insanely over-weighting some specific stocks unless its completely intentional and you know exactly what stock you are over weighting in, every month.

Perhaps you can share with us your investment philosophy for this portfolio to let us better understand it? Investment horizon, etc.

If you didn't own individual stock and make a portfolio of 1-30 stock, that means you wanted to diversify.

If you wanted to bet on the US, that the top 100 company will continue to grow, then QQQ is good enough, why SPY(CSPX)?

If you wanted to bet on the US, the top 500 company will continue to grow, you are more diversified, and their business being international in nature gives you pseudo-international exposure, then why QQQ?

If you are worried about US's growth, their ridiculous P/E ratio, and they may or may not receive a massive 20%+ pullback in near future, winners rotate to international stock for the next decade, and want to invest in 60US:40International ratio, and the next time it rotate again, it doesn't matter to you, because you hold all of them - then VWRA is perfect, why overweight US again with QQQ/SPY?

...et cetera.

This post has been edited by Hoshiyuu: Feb 9 2022, 11:52 PM

They are very close in value with Sunway winning sometime on working hours, and going through CIMB SG leaves a better paper trail for audit purposes.

If you do Wise via ACH directly to USD however you pay less FX conversion fee when depositing smaller amount (converting SGD to USD has a flat 2USD fee for most amounts on IBKR)

It'll be up to your deposit size and preferences mostly.

VWRA do hold emerging markets and European markets... And they are holding it by weight/market cap as it should be. What you are referring to is overweighting certain country such as China, which given investors sentiment that US is overvalued or due for a correction in the near future, is not a bad idea to underweight US.

But lack of a good way to buy ex-US UCITS fund means that you are either stuck with having to buy multiple other ETF, or buying some VXUS and losing out a little on dividends to withholding tax.

Personally I'm happy with just having VWRA and skip the rebalance nightmare and cost. The performance will even out overtime given my horizon.

This post has been edited by Hoshiyuu: Feb 11 2022, 12:57 PM

Well said on the matters of fees!

My original two fund portfolio is exactly VWRA+VAGU at a 90:10 ratio, which by the time I retire I should able to survive out of selling bonds alone for a good while, and anywhere between 10% to 40% bond have fair and varying optimal portfolio success rate, but I opted to not buy any bonds for now and likely stay 100% equities forever.

My reasons are:
1. I don't see a reason to buy bonds when I have at least 20 year on my horizon, I need accumulate as hard as I can right now to get compounding working.

2. I seek to keep a healthy amount of emergency fund in MMFs or other low risk assets, and minimizes my monthly commitment that I can survive at least 1-2 year of market downturn and unemployment without liquidating any equities.

3. Bonds in general isn't in a great place right now, it's likely not going to give much if any return at all for foreseeable future and it's really just a weak store of value option in my opinion

4. We have access to EPF/SSPN as amazing pseudo-bond options. This is the most important thing to us Malaysian Bogleheads IMO compared to US recommendations. We have forced saving at a decent rate in EPF, and SSPN Prime gives good steady return with very good liquidity and overall ease of access, with both platform easily providing 4%+ safe returns*. EPF alone is a great analogue to function as 20-50%++ bonds to your DIY equities portfolio.

*While the cynic in me has little confidence in the government, both of this vehicles affect enough people that I'm sure even the government will think twice before messing with them. If EPF or SSPN goes kaput, we have bigger issues.

I would love to get comments, thoughts and counter point to reasons #4.

This post has been edited by Hoshiyuu: Feb 11 2022, 08:37 PM

Market order is generally considered a bad practice even if it really doesn't matter at my level buying power. Just to build good habit, I place a limit order at the lowest ask or something and let it fill instantly.

I buy monthly but I currently do not deposit and convert currency monthly.

If you choose to DCA monthly, please take care of not letting transaction cost eat into your investment too much. I aim to keep it under 1% but 0.6% if the best I can do now until I increase my income further or changing my deposit interval to once per 2 months.

I'm not sure if the performance listed at fund pages include both coupons and capital gains, but if it does give me around 3% or above overall there's an argument to be made to not put money into SSPN but bonds instead, given that MYR is circling the drain and threatening a dive 24/7 with such weak confidence in Malaysia market and it's government...

This post has been edited by Hoshiyuu: Feb 11 2022, 10:13 PM

Definitely, I have zero confidence in MYR too, I don't keep any MYR aside from basic spending and emergency funds - and even then I'm seriously considering making my emergency fund SGD instead of MYR.

In my case my EPF contribution is mandatory, so whether I like it or not I'll already have this stable asset that I can eat from when I retire. For your case I definitely won't recommend putting more than the tax relief threshold. You should seek bonds then if you want to have some ballast asset in your portfolio, tuning the amount to your risk appetite and investment horizon.

I strongly dislike FD because of the lock in and given FD absolute terrible rate right now that has no end, a high yield saving account, MMFs (specifically Versa or SA simple that has next to no fee and sale charges) sounds like a better idea.

Or just buy some VAGU, it's cheap right now 😆

Speaking of dividends, for those considering dividend investing, these video provide good advice when considering such a path, as opposed to simply having a simple 2/3-fund portfolio using broad based index with less of a focus on dividends.

Ben Felix - The Irrelevance of Dividends

The Plain Bagel - Why Investors Love Dividends (And Why They Can Be Dangerous)

A more local flavor for those that prefer it.
Kelvin Learns Investing - The Problem With Dividends | Dividends Don't Matter


This post has been edited by Hoshiyuu: Feb 11 2022, 10:53 PM

A lot of people also greatly overestimate their risk tolerance and haven't experienced a real bear market when they already have an significant amount invested. To stay the course over 3+ years of constant bear, unemployment stress, and everyone telling you THIS time it's different...

Making decision on feeling and tinkering with your portfolio too often is detrimental more often than not.

Portfolio success rate are often much more fragile on investor behavior than whether it makes another 0.5% more than the other fund.

I wouldn't go to the extreme length of one of Bogle's anecdotes, where he recommended someone to just deposit and never peek until 30 years later.

But you should have a an investment policy statement, documenting what you hold, why you hold them (this is very important when you are tempted to switch to other asset), and under what conditions you are allowed to change them (e.g. net worth, age). Having it and having the discipline to follow through will prevent your "appetite changes" after a major loss affecting your portfolio.

If you allow yourself to switch assets and allocation at will, you are more likely to cause damage and decrease your portfolio success rate.

And, you need to review the conditions you've set for yourself too. "I'll increase my bond allocation when market feels uncertain" is a rather poor reason in my opinion. Your asset allocation should be based on something more fundamental, like "If another 2008 happen, I do not believe I can endure an extended 30% drawdown. I can stomach 15% drawdown at best and according to portfolio backtester, that meant (sample number) having 40% in bonds".

Then perhaps you would have a clause that "I will only allow once allocation change per year when the decision is well reviewed and at least 3 months has passed since the decision is made and it remains logically sound".

Finally, you execute the change while rebalancing your portfolio on such dates to save on fees and hit multiple bird with one stone.

At least, that's what I do myself and I am interested to receive opinions on that thought process.

This post has been edited by Hoshiyuu: Feb 12 2022, 11:04 PM

Yeap I just noticed when I saw your reply to Cubalagi, my bad!

It's not to reduce chance of drawdown, it's reducing the amount of drawdown when a bear market happens because bonds is a different asset class.
e.g. if you had portfolio A 100 Equities : 0 Bonds and portfolio and a 50 Equities : 50 Bonds portfolio, then when a 50% market drop happens, Portfolio A would lose 50% of its value but Portfolio B would only lose about 25% of its value, roughly.

A higher amount of equity will obviously bring you higher return, but the higher you go the more diminished is the reward-per-risk so to say. By having 10-20% in bond no matter how young you are helps reduce maximum portfolio drawdown and doubly serve as a balance mechanism to ensure you buy low, sell high.

My target bond is VAGU - Vanguard Global Aggregate Bd UCITS ETF USD Hgd Acc, which is Irish domicile, has only 15% witholding tax.

Side note, people often equate "risk tolerance" = "how far I can accept temporary losses". But in reality when a real, extended bear market happen, it quickly goes beyond "emotional tolerance" but become a physical problem of "how long I can survive without liquidating my equities at a loss" - and you don't know if its 3 days, 3 months, or 3 years. Most people barely have an emergency fund of 6 months of expense as it is.

This post has been edited by Hoshiyuu: Feb 13 2022, 01:40 AM

I don't think direct bond is easy to buy at low amounts, but I wouldn't know much about that regardless.

From a liquidity and longevity standpoint AGGU is pretty much widely accepted as the better option, as well as AGUG. VAGU is a pure personal preference since Vanguard reduces ongoing cost when possible on their own.

In general I do believe Bond ETFs are much more easier to work with, and easier to sell when you need the cash and doesn't miss out on coupons as much when done so.

Assuming a portfolio of 1mil, and 80% equities loss 50%, you are down to 600k, with 400k equities and 200k bond (bonds usually drop some too but we'll neglect that for this example)
Now if you are unemployed and needed money, if you sell equities you will be realizing the 50% loss on equities, and when the market recovers, you might significantly recover less if you had to sell quite an amount.

If you had 20% bond however, now you have 200k to survive on by liquidating only the bonds. And in the best case scenario, where you have enough emergency fund to survive this downturn, you can rebalance the bonds into equities to buy them at a huge discount.

That's the role of bond, so 20% surprisingly helps a lot.



In a planned portfolio with not too much margin for error (would be the case for an average earner), having your portfolio rollback by 6 years would severely delay your early retirement, or easily reduce your yearly withdrawal amount in your retirement - at a 50% equity drop, its entirely possible to go from "just comfortable enough" to having to move into a shared apartment and live on maggi for a few years until the market bounces back.