Talk:Asset allocation

Is the "age in bonds" rule from Jack Bogle? If so, the BH wiki recently clarified his intent. See: Rules of thumb. The footnotes contain supporting information, which could be adapted for finiki (Larry Swedroe table). --LadyGeek 19:12, 26 July 2012 (MDT)

Rebalancing
The page says "A typical recommendation is you should rebalance at least once a year". I suggest deleting "at least". Rebalancing once a year should be fine, more often is probably not needed. If stocks have momentum then once every other year would be even better. Anyway the AA page is not the place to get into rebalancing details, but simply deleting "at least" would bring the statement in line with conventional wisdom. --Quebec 16:39, 7 January 2015 (MST)
 * I agree and have removed "at least" from the description. --LadyGeek 18:12, 7 January 2015 (MST)

Tactical asset allocation
Institutions can't do this profitably (www.researchgate.net/publication/228656645_Tactical_asset_allocation_Australian_evidence/file/72e7e5216c9a5bdf43.pdf). Imagine if the guy on the street tries it. Should there be a warning that tactical asset allocation can be detrimental to returns? --Quebec 17:30, 7 January 2015 (MST)
 * Here's the link: Tactical Asset Allocation: Australian Evidence. Remember that finiki follows the principles of Wikipedia: Five pillars, all perspectives should be presented from a neutral point of view. The article is focuses on Australia and was published in 2005. Can you find FWF discussions or recent publications that can present a Canadian perspective? --LadyGeek 18:12, 7 January 2015 (MST)
 * When we say "A typical recommendation is you should review your asset allocation once a year and if necessary rebalance as specified in your investment policy.", we imply that we are not engaging in tactical AA. --Quebec 14:18, 8 January 2015 (MST)
 * As described in the page, I don't see that point implied. There needs to be a clear (dedicated) section to present this perspective. The Bogleheads wiki bogleheads:Tactical asset allocation is not clear on this point, either. Complicating everything is the mixing of actively managed funds and market timing - two separate topics. The objective from a Bogleheads perspective is to utilize low-cost funds, not whether it is actively managed or an index fund. (I have not answered your point, but instead presented two additional finer points.) --LadyGeek 17:44, 8 January 2015 (MST)
 * I concur with LadyGeek on the point that all perspectives should be presented from a neutral point of view. This is a fundamental policy of the wiki. Therefore tactical asset allocation and it's definition should be included. Unless citations, particularly with a Canadian viewpoint, can be found to support the statement that it is detrimental to returns then I don't think it should be added as it seems more of an opinion than a fact. The focus of the rebalancing section is keeping asset allocation in line with policy and I also don't think that implies anything about whether or not tactical asset allocation is involved. --Peculiar Investor 19:57, 8 January 2015 (MST)

Today's additions
Material has been copied from the "Portfolio design and construction" page being redeveloped, and moved here. This includes the human capital graph and accompanying sentences (within "rules of thumb"), and the whole section on "Domestic vs foreign asset classes". Additional sentences have been copied or modified from the Bogleheads wiki: the 1st paragraph of "Stay the course: strategic asset allocation" and the "All age-based guidelines..." sentence of "Rules of thumb". --Quebec 12:16, 17 January 2015 (MST)


 * Human capital is a term only used by economists. As a new investor, I would not understand what this means in the context of investing. Yes, there's a page on the Bogleheads wiki: Human capital, but I don't think it belongs in an introductory article. I revised the section title and added a definition from Investopedia. The concept is introduced, but the reader will not be distracted from the intent of the page. I also uploaded a larger version of the chart. --LadyGeek 15:51, 17 January 2015 (MST)


 * Should we copy this page into one of the user spaces and modify it there for a while? (explanation: it's likely to evolve quickly as we work on "Diversification", "Portfolio design..." and so on)
 * I don't think so. If anything, put Under construction on it as an indicator to readers that the contents might be undergoing change. --Peculiar Investor 18:21, 19 January 2015 (MST)

Other considerations like house, DB plans, CPP etc.
After reviewing a number of FWF discussions that contain asset allocation in their title, the matter of whether to include/exclude house, defined benefit pension plan, Canada Pension Plan and Old Age Security comes up periodically, yet doesn't have coverage in the article. Part of the reasoning is that there is no clear consensus on whether to include/exclude, but perhaps that very fact is worth working into the article. Thoughts? --Peculiar Investor 22:57, 26 January 2015 (MST)

BH forum - quotes posts
I struggle with what to do with the BH forum post with a series of quotes about asset allocation. The problem is the quotes are all one-liners that don't have the surrounding context, nor source information that the reader could use. I'm not questioning the collection of quotes, just whether as presented they meet the standard for inclusion in the wiki. --Peculiar Investor 18:30, 2 February 2015 (MST)
 * I don't think they need to be included here. The message is not the content itself, but that there are a large number of experts who agree on the importance of asset allocation (and diversification). --LadyGeek 19:51, 2 February 2015 (MST)