Investing

The Magnificent Seven¹ is a group of technology companies. This group is a significant weighting in the S&P 500.

The Vanguard mutual funds in my Vanguard 100 asset allocation may not be available for non-US investors. Here is an equivalent asset allocation consisted of exchange-traded funds (ETF’s).

In mid 2000’s, I replaced the constituent funds in side the IFA 100 asset allocation with Vanguard index funds. At that time, Vanguard did not have an international small-cap index fund. Instead, I chose the Vanguard Developed Market Index Fund, which is an international large-cap style.

An asset allocation is the percentage for each asset in a portfolio. Suppose a portfolio is investing for retirement, then as an investor’s age nears the retirement age, the percentages should be adjusted. This change over time is called the glide path of an asset allocation.

It is a common rule-of-thumb to keep 6 months of expenses in cash as emergency fund. Sometimes the recommedation is 3 or even 12 months. Is there a better way than parking that cash in the bank?

It’s a common sense to pay off the debt with the highest interest first. This also applies to retirement investment accounts.

In a previous post, we talked about asset allocation for retirement. To design an asset allocation for a financial goal for an investor, we need to understand time horizon of the goal and risk capacity for the investor. We discussed time horizon previously. Using time horizon, we can arrive at asset allocations for different goals. In this post, we will talk about risk capacity for the investor.