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Low risk vanguard retirement portfolio

Low Risk Vanguard Retirement Portfolio
May 16, 2020 12:35 AM ETVBMFX, VEXPX, VFICX.

Investment portfolios with low volatility, low drawdowns and high returns can be constructed with Vanguard mutual funds.
From January 2003, a dual momentum strategy applied to a five-fund Vanguard portfolio would have produced a safe 5% annual withdrawal rate while achieving a 6.76% annual balance increase.
The strategy described in this article is suitable for conservative investors. It requires quarterly reallocation of funds and is robust with respect to its two parameter selections.


  • The longer I am a retiree, the less interested I find myself becoming in strategies I need to monitor for market signals. I did not used to feel that way!
  • Totally agree @Charles. And there aren't any market signals warning you of a black swan event.
  • Here is my "secret" how to beat the above at 6.96% annual return. All you need is just one fund VWIAX. See results (here)
  • edited May 21
    Yep. You're telling me. I certainly wish I'd invested all in just VWINX (VWIAX) and forgotten about it. I do own it now, since getting back to basics. But given that we've been in a bond bull for most of its existence, I'm not sure my expectations going forward are quite as high.

    Along those lines, DODBX and VWELX were both favorites picks as well for "If you wanted to own just one fund ... " circa early 2000s. I actually owned the former, which did not fair well in GFC, but recovered nicely long run.

    ABALX (if you can get right class via 401) would be in same category.

    I used to believe a one fund portfolio would be AOK. Still think it's true if the fund company is large enough, reputable enough. But I've grown wary of the idiosyncratic risk of placing all your savings in a single fund, unless that fund has gobs of liquidity.

    Buffett of course still advocates that with VFINX or SPY.
  • Oh, another one (@bee): SPY/TLT 50/50 and forget about it.
  • @Charles - now what fun would either of those two choices be.
  • Charles said:

    Oh, another one (@bee): SPY/TLT 50/50 and forget about it.

    Why does anyone ever choose SPY over VOO?

    For me TLT would be too jumpy for what I want a bond ETF for, but it sure does majorly outperform VGIT, and even BND.

    I'm slowly deciding on 55-45 VONG (maybe w some CAPE) and VGIT (maybe w some BND) --- or so I claim today, anyway.
  • @davidmoran. Sure. It's the zig-zag, ying-yang nature of the combo that makes it attractive ... more than either one alone, for me anyway. c
  • yes, more decorrelation than other bond ETFs obvs

    you might want to look at EDV instead - ?
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