@busdriver11, How about Chinese A shares? They’ve fallen a fair bit but the future generally seems pretty good there. They’ve go the population and a government that needs economic growth to maintain its hold on power.
@BunsenBurner, I don’t doubt the perceived value of good markets to the current administration. However, starting trade wars with Canada, Mexico, Europe and China probably run counter to that objective.
Seems the only way to buy Chinese A shares on Vanguard is getting something like their Emerging Market ETF, or Emerging Markets Stock Index Fund. I’m not sure about that, as things seem a little dicey right now with a full on trade war in sight…then again, maybe that’s depressing the prices and making it a good time to invest.
I don’t trust most Chinese stocks because of lack of transparency. I own 2 stocks (BABA and TCEHY) and will purchase more on pullback.
I’m boring. I (mostly) stick tp a 3-fund portfolio: total Stock market, total international stock market, and total bond market.
The exceptions to that are Vanguard PRIMECAP, which we are grandfathered into but can only contribute a limited amount to each year, wife’s employer’s stock which we receive as restricted stock units (and sell as soon as they vest), and one lonely share of Berkshire Hathaway, which has too much capital gains to want to liquidate. I think the kids will like the step up in basis when they get it.
I remember when Berkshire Hathaway stock was around 3K, and I thought it would be insane to buy such an expensive stock. Primecap is great, we can put all of our 401K and company contributions into it, at least so far. I am heavily weighted towards Primecap. BABA has done really well, hasn’t it? Edit to add…over time, not lately, with trade war fears creeping up on it.
With all due respect, total after-tax return is all that should matter for retirement. When dividends are paid, its a wash as to what is ‘taken away’ from you. For example, if a stock trades at $40.00 per share, and the company declares a $1 dividend, the price immediately drops to $39.00 per share. So, you now own a share worth $39 and receive an income check of one dollar, with taxes due immediately on that income. And, of course, its not a capital gain.
(Finance 101 teaches that there is no long-term difference in total return when comparing dividend-paying stocks and non-dividend paying stocks, such as BRK, particularly after-tax.)
Oh, I know it’s a wash with the dividends, but I’m not good on holding onto stocks long term. Get the dividend, wait till the stock goes up again and sell it. Or just sell when the stock goes up. I would have done so much better if I would have hung onto the stocks I purchased. I can’t even think about it, I’m just trying to stop selling things.
As long as you hold at least for one year, you get a capital gains tax rate on the LT gain. However, that dividend is taxed as income; thank you for helping to reduce the federal debt. 
Oh yeah, like anything extra we’re paying is going to help pay down the debt. That’s my laugh for the day!
I am happy to pay taxes - it means I made money. 
Making money is good, and I don’t object to paying taxes…however at some point when they’re taking away too much, you start feeling like you’re working for the politicians slush fund, not yourself.
I also have some shares of Berkshire Hathaway. Not clear when to sell. You are probably right. Let this pass to the kids or use for a charitable donation. Same with Apple shares. Just looking at my portfolio, I see Baidu and Tencent. We also have some Primecap.
I’ve been thinking about investments that are less correlated with the market, which seems very high. We also have some real estate that has gone bonkers over the last few years. Not clear when we’d sell this. But, both are in areas of a tech city, so I suspect a significant market decline could hurt values somewhat. In 2007, I made a very modest investment by their standards and sizeable by mine in a private equity fund from one of the top 3 PE companies. I was worried about what they would do after the collapse, but they were patient and achieved a decent rate of return. I think I only had to fund 70% of the total capital commitment and I don’t think I have yet gotten all the money back as they are still harvesting investments. It looks to me like they have almost doubled the committed capital over 9+ years. Recently made a smaller investment in a more targeted PE fund by the same group. The fund will focus on Global Private Infrastructure in OECD countries. My guess is that there will be lots of opportunities here during/after a recession.
Should have bought some PRIMECAP when I worked at Vanguard in the mid 80s!
Three friends from the company where I worked in the mid-80s (after Vanguard) retired this week. All three are under 60 (and one is 55). I just don’t see that happening for us for at least 15 years (if then!). DH likes his job too much.
That’s our plan: pass to them upon death with stepped-up basis, so no taxes due.
Not necessarily. That dividend that you receive could just be a return of your money (original investment).
Back to my $40/sh stock price example.
You purchase one share on Jan 2. After five months (of worries about a tariff war?), your stock has not moved; it’s still ~$40/sh. On June 1, the company declares a $1 dividend, which you receive July 1. Your stock now trades at $39/sh, and you have ‘earned’ $1 of income per the IRS. But in fact, that was just a return of your own money. More importantly, you are now worse off by the tax rate against that $1.00, which becomes a contribution to the US Treasury. 
If the dividend paying stock in an IRA , then doesn’t that fall into the “can’t take it away” category? It’s all going to be taxed as income… Say I inherited an IRA from my father (which I didn’t, thank the Lord, because they are both in great health), dontvdividends just get plowed back in and my RMW each year is all taxed as income?
I don’t buy dividend-paying stocks in taxable accounts, thus, my tax rate will be the same - growth or income.
duplicate post.
"You purchase one share on Jan 2. After five months (of worries about a tariff war?), your stock has not moved; it’s still ~$40/sh. On June 1, the company declares a $1 dividend, which you receive July 1. Your stock now trades at $39/sh, and you have ‘earned’ $1 of income per the IRS. But in fact, that was just a return of your own money. More importantly, you are now worse off by the tax rate against that $1.00, which becomes a contribution to the US Treasury. "
Using this logic, after 10 years, the stock price will be zero. Meanwhile, new eager buyers come and bump the price up in anticipation of the next quarter dividend. The longer one holds, the better one could be off. And favorite treatment of LT capital gains is not guaranteed to last forever.
Financially, that is not correct. There is little/no difference on long term outcomes when comparing dividend-paying vs. non-dividend stocks.
Definitely true. I just need to die before they get rid of the stepped-up basis!