Yes, and the essence of it is that he does not think that experiencing large downturns along the way is any problem at all. Yet stocks have more than once lost in the range of half their value in the stretch of only two or three recent decades. The market recovered from those losses and continues to rise over time up till now. The investor who accepts this 90/10 recommendation does that understanding about these losses and assumes that recovery will follow.It’s an aggressive Boglehead portfolio. Jack Bogle wasn’t a fan of international investing either. His bond choice is not particularly diverse but he’s using it as a substitute for cash so he’s not interested in growth.
He leaves out a lot of details, like do you ever rebalance.
But in the end, I think he is simply suggesting that normal investors should buy the market in a low cost index fund. I doubt the 90/10 was particularly well thought out. He was trying to make the point you don’t need to time the market or make big bets. Buying the market at a low cost was the point.
Statistics: Posted by dbr — Wed May 01, 2024 6:45 am — Replies 154 — Views 13926