I went thru the same analyzing loop x 10 million.
AVGE is a simple, single fund with a home country bias built in. VT has no home country bias.
With VT you have zero chance of wishing you had purchased the whole market, meaning tracking error/regret is zero. It is much larger which means your bid spreads and volume will be better.
On the other hand, with AVGE you are deciding on a predetermined tilt, according to Avantis. Unless to add a second fund later, such as VT, you have no control nor idea which part of AVGE is really working, the total market cap side or the tilt side.
However, when you separate your holdings into two funds, say VT and AVUV, if you are experiencing moments of regret in tilting at all, just direct all contributions to VT and forget, I mean completely FORGET you ever purchased AVUV. NEVER SELL AVUV, unless the factor premium the academics say should show up, some day, some day in the future, wait for it.....shows up.
Basically, it's just easier to mentally separate the tilt component of your investments if you can actually see it next to VT. Nobody knows the correct amount of tilt and exactly how to implement it, so it is difficult to nail down a decision.
Lastly, Avantis will change their fund offerings and methodology forever moving forward. If I had a dollar for every post I've seen either here or on Rational Reminder where an investor hears of a new "perfect" fund offering, converts to 100% AVGE or whatever, then a new, better "perfect" fund is offered and now they are 100% AVGV or whatever. They are in the product cycle, paying spreads and mental anguish with each gyration.
For the record we have VT and a AVUV/AVDV tilt off to the side.
AVGE is a simple, single fund with a home country bias built in. VT has no home country bias.
With VT you have zero chance of wishing you had purchased the whole market, meaning tracking error/regret is zero. It is much larger which means your bid spreads and volume will be better.
On the other hand, with AVGE you are deciding on a predetermined tilt, according to Avantis. Unless to add a second fund later, such as VT, you have no control nor idea which part of AVGE is really working, the total market cap side or the tilt side.
However, when you separate your holdings into two funds, say VT and AVUV, if you are experiencing moments of regret in tilting at all, just direct all contributions to VT and forget, I mean completely FORGET you ever purchased AVUV. NEVER SELL AVUV, unless the factor premium the academics say should show up, some day, some day in the future, wait for it.....shows up.
Basically, it's just easier to mentally separate the tilt component of your investments if you can actually see it next to VT. Nobody knows the correct amount of tilt and exactly how to implement it, so it is difficult to nail down a decision.
Lastly, Avantis will change their fund offerings and methodology forever moving forward. If I had a dollar for every post I've seen either here or on Rational Reminder where an investor hears of a new "perfect" fund offering, converts to 100% AVGE or whatever, then a new, better "perfect" fund is offered and now they are 100% AVGV or whatever. They are in the product cycle, paying spreads and mental anguish with each gyration.
For the record we have VT and a AVUV/AVDV tilt off to the side.
Statistics: Posted by guppyguy — Sun Mar 03, 2024 8:50 pm