Building an ETF portfolio (1 Viewer)

[jamny]

Looking to take about 10k from our HSA account and invest in some ETF's Using hsabank, I can sign up for TD or Devenir. I think I'm going with TD. I have a TD account so hopefully I can merge them somehow and they have a lot of commission free etf's. Although I'm already starting to see that the commission free ones aren't always the best.

I'd like to put together a balanced ETF portfolio. It's our hsa so I don't want to be really aggressive but I would put aside 20%+ for speculation. I'm thinking like 5 different etf's with maybe 2 to play with. Like VTI and then a large cap or commodity and then an energy or housing one, then biotech or 3d printing, then maybe an emerging market.

What are some good websites, videos, podcasts, etc for etf's?

 

[Zegras11]

Put it in TRX

 

[Don't Noonan]

VTI is a great one. VEA is a good international play.

 

[kevzilla]

Looking at XBI for biotech. Picking winners in that sector can be challenging, see the stock contest every year. 

 

[-OZ-]

Looking to take about 10k from our HSA account and invest in some ETF's Using hsabank, I can sign up for TD or Devenir. I think I'm going with TD. I have a TD account so hopefully I can merge them somehow and they have a lot of commission free etf's. Although I'm already starting to see that the commission free ones aren't always the best.

I'd like to put together a balanced ETF portfolio. It's our hsa so I don't want to be really aggressive but I would put aside 20%+ for speculation. I'm thinking like 5 different etf's with maybe 2 to play with. Like VTI and then a large cap or commodity and then an energy or housing one, then biotech or 3d printing, then maybe an emerging market.

What are some good websites, videos, podcasts, etc for etf's?

Re-read this, it looks like you're limiting yourself to around $2,000 to "speculate" with the other $8,000 in non aggressive investments?

Are you sure you want to risk much here at all? When would you anticipate possibly needing the money? Understanding that it's an HSA and not retirement you might not have a time horizon but how screwed would you be if you had a major expense while the market dropped? Is this $10k a small amount relative to the rest of your HSA?

If you might need it in the next 5-10 years something like 40% VTI, 20% XBI, 40% VCLT might make sense. But really you need to estimate your need as best possible. 

 

[jamny]

Re-read this, it looks like you're limiting yourself to around $2,000 to "speculate" with the other $8,000 in non aggressive investments?

Are you sure you want to risk much here at all? When would you anticipate possibly needing the money? Understanding that it's an HSA and not retirement you might not have a time horizon but how screwed would you be if you had a major expense while the market dropped? Is this $10k a small amount relative to the rest of your HSA?

If you might need it in the next 5-10 years something like 40% VTI, 20% XBI, 40% VCLT might make sense. But really you need to estimate your need as best possible. 

We have 18k in our hsa, so enough to cover the 6k deductible if one of us needs to max it out. The hsa is a small amount compared to the rest of our savings and investments but we obviously want to have it grow so yeah, maybe I should temper my exposure to risk a bit. I haven't really followed etf's until this point so I get tempted to treat some as play money. I have a few grand in stocks in my own TD account but I'm really not that active an investor. Maybe I'd be better off shifting that money to an aggressive etf plan and keep my hsa more conservative.

 

[-OZ-]

We have 18k in our hsa, so enough to cover the 6k deductible if one of us needs to max it out. The hsa is a small amount compared to the rest of our savings and investments but we obviously want to have it grow so yeah, maybe I should temper my exposure to risk a bit. I haven't really followed etf's until this point so I get tempted to treat some as play money. I have a few grand in stocks in my own TD account but I'm really not that active an investor. Maybe I'd be better off shifting that money to an aggressive etf plan and keep my hsa more conservative.

Sounds like you have your bases covered so it's really just a question of your true comfort. I don't have an HSA (not eligible) so I haven't looked too closely at the options. 

Off hand I don't think I'd use the HSA as play money but it might make sense with the tax benefits. Early on I made the mistake of using our non tax benefited account as play money, ended up paying more in taxes than I planned.

 

[jamny]

Sounds like you have your bases covered so it's really just a question of your true comfort. I don't have an HSA (not eligible) so I haven't looked too closely at the options. 

Off hand I don't think I'd use the HSA as play money but it might make sense with the tax benefits. Early on I made the mistake of using our non tax benefited account as play money, ended up paying more in taxes than I planned.

I hadn't even thought about there not being tax on investment profit as long as we use it for medical purposes. I really wish they would raise the cap on how much you can put into the hsa.

 

[Rattle and Hum]

if you must be in equities with some of your HSA I would consider $2k biotech, $4k financials/insurance (higher rates coming), and $4k in IPFF (preferred stocks).

 

[jamny]

if you must be in equities with some of your HSA I would consider $2k biotech, $4k financials/insurance (higher rates coming), and $4k in IPFF (preferred stocks).

Yeah, I think I was overlooking financials and their 2018 outlook, especially banks. I should really put a portion towards that, possibly XLF. I need to look more into the healthcare sector and decide where to invest there, whether bio or tech related. Then technology itself...FTEC? Then I'm considering something with Consumer Staples that have a good emerging market presence. Or go with a full emerging markets etf like EEMO. Not sure on that yet.

 

[-OZ-]

Yeah, I think I was overlooking financials and their 2018 outlook, especially banks. I should really put a portion towards that, possibly XLF. I need to look more into the healthcare sector and decide where to invest there, whether bio or tech related. Then technology itself...FTEC? Then I'm considering something with Consumer Staples that have a good emerging market presence. Or go with a full emerging markets etf like EEMO. Not sure on that yet.

 

[culdeus]

For such a small balance it may be easier to just put it in a target year fund so you dont have to rebalance each time you deposit or liquidate for health expenses. 

 

[Rattle and Hum]

 Then I'm considering something with Consumer Staples that have a good emerging market presence.

Staples versus discretionary.

 

[jamny]

 No good?

 

[jamny]

For such a small balance it may be easier to just put it in a target year fund so you dont have to rebalance each time you deposit or liquidate for health expenses. 

Interesting...thx. Didn't know about those.

 

[-OZ-]

 No good?

It might be great. I just laugh when ticker symbols make words. 

https://www.google.com/url?sa=t&source=web&rct=j&url=https://www.newyorker.com/business/currency/the-secret-science-of-stock-symbols/amp&ved=2ahUKEwj7w_3c4-nYAhUBR6wKHYXtDsIQFjAAegQIExAB&usg=AOvVaw31Bhg9WhUfSHSwh3Uk0vgW&ampcf=1

Why do investors, many of whom painstakingly dissect reams of data to understand companies’ finances, also base their decisions in part on a stock’s ticker symbol? The answer is that reading pronounceable ticker symbols is slightly less mentally taxing; people generally prefer objects and events that are more “cognitively fluent,” or easier to process. The same logic explains why we tend to prefer people with simpler names, and why the aphorism “caution and measure win you treasure” seems truer than “caution and measure win you riches.” In each case, the more fluent concept seems more familiar, less risky, less threatening, and more trustworthy—and the same is true of stocks and, more broadly, of economic decisions. Few investors admit to choosing a stock based on its name; biases like these are powerful precisely because they operate below the surface of conscious awareness.

 

[Short Corner]

I have a substantial amount of our retirement funds in SDOG.  It implements a dogs theory but over the S&P 500 instead of the 30 DOW stocks so it is a little bit more diversified.

 

[jamny]

So late last year, TD Ameritrade tripled their offerings of commission free etf's but also dropped Vanguard funds and other quality ones from the category. While I don't intend on being overly active with it, I will still look to reevaluate and possibly rebalance once or twice a year on some of them. With maybe 4 or 5 different funds that could add up, but will the returns make up the difference? For example, instead of VTI, which is no longer commission free, I could go with SPTM. It has a slightly lower expense ratio (.03 vs. .04) and higher yield and is commission free. Obviously lower market cap and not as actively traded but not below acceptable levels.

I'm probably overthinking it but still want the best possible return. If all things are relatively equal, should I go with a competitive commission free etf or stick with a bigger one and pay the commission?

 

[jamny]

OK, lots of research. I really like xtf.com and their ratings and comparisons. And Morningstar's portfolio xray (embedded in TD) is really helpful. At the moment, I'm considering the following list, which seems to have good overall coverage and not much overlap. Not sure yet on percentage allocation.

SPTM - SPDR Portfolio Total Stock Market ETF - for full market coverage

VEU - Vanguard FTSE All World Ex-US - International coverage 76% Developed, 24% Emerging

PSK - SPDR Wells Fargo Preferred Stock

SPMD - SPDR S&P 1000 - micro/small/midcap US

XT - iShares Exponential Technologies - Interesting combination of global with a focus on Technology and Healthcare

Any opinions or comments very welcome!

 

[fantasycurse42]

I'd heavy up on that VEU, although I wish it was more geared at emerging than developed. 

I'm heavily weighted right now internationally in my 401k... almost 40% between developed and emerging markets. 

 

[Fruitbat]

So late last year, TD Ameritrade tripled their offerings of commission free etf's but also dropped Vanguard funds and other quality ones from the category. While I don't intend on being overly active with it, I will still look to reevaluate and possibly rebalance once or twice a year on some of them. With maybe 4 or 5 different funds that could add up, but will the returns make up the difference? For example, instead of VTI, which is no longer commission free, I could go with SPTM. It has a slightly lower expense ratio (.03 vs. .04) and higher yield and is commission free. Obviously lower market cap and not as actively traded but not below acceptable levels.

I'm probably overthinking it but still want the best possible return. If all things are relatively equal, should I go with a competitive commission free etf or stick with a bigger one and pay the commission?

well WTF....when the heck did the bolded happen?  I'm all in VTI, VUE, and BND....now they are not on the list anymore!

But I look at the transactions I made recently....mostly buying BND...and I dont see anything in the details about being charged commission?

 

[jamny]

well WTF....when the heck did the bolded happen?  I'm all in VTI, VUE, and BND....now they are not on the list anymore!

But I look at the transactions I made recently....mostly buying BND...and I dont see anything in the details about being charged commission?

I think it was last October. Apparently, Vanguard didn't want to pay TD to be on their commission free list. They tripled their amount of commission free etf's but buried the dropping of funds in their announcement. Don't know if there's a fee to sell of if you are somehow grandfathered in. I doubt it.