Vanguard 500 vs Vanguard Total

[lamchau]

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The first article isn't pro-500 it's pro-DFA. But consider the source...the Merriman people are like jively's firm: they only use DFA funds.

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Yes, but jively is still capable of recommending Vanguard... [img]/images/graemlins/smile.gif[/img]

The Total Stock Market fund and the 500 fund should have very similar expected returns and risks over long periods of time. The Total Stock Market fund is definitely better because it is more tax efficient, and it doesn't have arbitrage-type traders gaming the addition and deletion of S&P 500 stocks. If you had to have just 1 US stock fund, the Total Stock Market fund is better.

However, you can increase expected return for the same level or risk, or you can lower the risk and keep the same expected return by using multiple funds, including the small cap and value funds, and diversifying internationally. Here is a recent recommendation of a globally diversified portfolio.

-Tom

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Your recommendations only involve Vanguard? A list composed by "rockrock" (http://forumserver.twoplustwo.com/sh...t=all&vc=1) recommended index funds by iShare and Forward also. I am a newbie so I do not understand the reasoning behind this. Please clarify jively.

Thanks [img]/images/graemlins/smile.gif[/img]