DIY Financial Planning

One of the most interesting aspects of the passive investing debate is not the evidence itself but the definitions used to draw the conclusions. Throughout this series, we have examined whether broad market-cap-weighted index funds, such as VT, should automatically…

A common claim in modern investing is that VT (Vanguard Total World Stock ETF) represents the most “pure” form of passive investing because it owns the “total market.” That framing sounds precise. It is not.

Many investors assume that total market index funds are efficient portfolios because they are low-cost, broadly diversified, and associated with CAPM and modern portfolio theory. But this argument often conflates two different ideas: expense efficiency and return efficiency. A portfolio…

For over three decades, William F. Sharpe’s The Arithmetic of Active Management has been treated as near-scripture for passive investing. Its logic is elegant, its math is simple, and its conclusion seems inescapable: before costs, the average active manager must…

We’ve all heard the advice: “Just buy VT” or “VT and chill”. But as we uncovered in Part 1 of this series The Hidden Cost of “Just Buy VT” , this hands-off approach carries a hidden structural cost.

Most investors think that passive portfolio construction is mainly about asset allocation. U.S. vs international stocks vs bonds developed vs emerging markets But there is another layer hiding underneath: The mechanism that determines how portfolio weights evolve over time.

For years, the default advice for global equity investing has been simple: “VT and Chill” – buy a total-world index fund like Vanguard Total World Stock Index Fund ETF Shares (Ticker: VT) and leave it alone. These funds are designed…