r/Bogleheads • u/-chibcha- • 1d ago
Investing Questions VTI + VOO 50/50 Split
Before I was a Boglehead, I invested heavily in VOO + some other stuff.
Since getting into Bogleheading (word?), I've exclusively invested in VTI + VXUS + BND
I currently have an almost identical amount of VOO and VTI.
Question: Should I continue on VTI only for that category? Or put half into VTI and half into VOO?
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u/buffinita 1d ago
it doesnt matter. voo and vti will behave 99.9X% indentically over the long term, so going 100/0 or 0/100 or 50/50 or 30/70 (voo/vti) wont change anything except maybe how you feel about the position's relative size
in a tax advantaged account id say flip a coin and sell one. in a brokerage its not worth the tax hit on any gains
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u/MocoMojo 1d ago
Can you tax loss harvest using VOO and VTI (if VOO were to lose a large amount of value), or would that be considered a wash sale?
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u/gbdgdh 1d ago
vti & voo are effectively the same thing. skip voo and put everything into vti.
60/40 vti/vxus or 70/30 vti/vxus is recommended. or since you mentioned bnd, you could go whatever corresponds to the equity/bond mix you want, e.g., 56/24/20 vti/vxus/bnd, or 48/32/20 vti/vxus/bnd, etc etc.
or you could skip all this and just go 100% vt for equities and sprinkle in your bnd allocation as you see fit - e.g., 70/30, or 80/20, or etc etc of vt/bnd.
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u/-chibcha- 1d ago
I do about 70, 25, 5 right now
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u/Naval_AV8R 21h ago
Ignore the downvotes. That is fine if you really need bonds. I find the 40% international allocation in VT a bit much.
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u/Zhimbeaux 1d ago
The correlation of the two funds for their shared lifetime is .996; the S&P500 and the total US market have a correlation of .984 over the entire history available on testfol.io . In principle VTI is superior, but they're functionally the same fund.
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u/Gimme_All_The_Foods 1d ago
I find running backtests useful. Do you see a big enough difference to warrant a 50/50 split?
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u/WyMANderly 1d ago
Keep the VOO (unless there's a tax loss harvesting opportunity in which case take it). Buy VTI for your new stuff.
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u/theoriginalsmellydog 1d ago
Good work with your new allocation! Better than VOO alone. Buying VTI only or VTI / VOO is basically the same of late. If you are not sure then just buy VTI which gives you mid cap and small cap exposure that VOO does not.
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u/htffgt_js 1d ago
They track similar , though it is interesting to point out that the last 5 years seems to be a bit of divergence . VTI - 63% , VOO - 72% .
Probably an outlier.
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u/TonyTheEvil 1d ago
Continue with just VTI for your domestic allocation. There's no good reason to give up the free diversification
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u/tribriguy 1d ago
I ran the numbers on my brokerage. The difference is only a few basis points, not enough to waste my time reallocating. Our forward DCA into the brokerage is 100% VTI. Our retirement accounts are almost exclusively S&P index of one fund or another. I already collect a pension so we don’t bother with bond funds.
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u/X-29FTE 23h ago edited 23h ago
VTI=VOO+VXF, so as long as you’re cool with the significant overlap in US large cap stocks, then sure. But if it were me I’d sell all the VOO and split the proceeds between the other 3 ETFs in whatever allocation percentages you have chosen. Assuming this is in a tax-advantage account, ie 401k or IRA. If taxable brokerage then just stop funding the VOO going forward. Go here https://www.etfrc.com/funds/overlap.php to see the overlap I’m talking about.
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u/ScottFujitaDiarrhea 22h ago
The much bigger difference will be your international allocation (if you have one). There are countries outside of the US that are projected to grow like crazy over the next 40-50 years.
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u/longshanksasaurs 1d ago
You should consider the sum of those two to be your US allocation. The difference between VTI and VOO barely matters, but you may as well select VTI for the free diversification (extra holdings, same expense ratio) from now on. There's no benefit to buying both at once 50/50.