There's a 30% sector weight in VTI to tech stocks. 10 years ago, tech weighting was about 15%. Dot com bubble in 2000 peaked at about 35% and then dropped to around 15% in a few years.
If you force yourself to invest in only one of the many global markets (the US), this is par for the course. Things can get concentrated and if they get overbought and something brings them down, there will be pain. You just have to deal with that risk if you put yourself in the US-only box. Well, you can't prevent pain with any equities really. But, you can diversify to the ENTIRE market. That is VT, which currently has a tech weight of 24%. a lower price/earnings ratio (17 vs 21), and a higher dividend yield (2.1 vs 1.4) despite consisting of 61% US stocks. This is the ultimate in diversification as you are buying the entire global market. Anything else is a bet against the market.
If you force yourself to invest in only one of the many global markets (the US), this is par for the course. Things can get concentrated and if they get overbought and something brings them down, there will be pain. You just have to deal with that risk if you put yourself in the US-only box. Well, you can't prevent pain with any equities really. But, you can diversify to the ENTIRE market. That is VT, which currently has a tech weight of 24%. a lower price/earnings ratio (17 vs 21), and a higher dividend yield (2.1 vs 1.4) despite consisting of 61% US stocks. This is the ultimate in diversification as you are buying the entire global market. Anything else is a bet against the market.
Statistics: Posted by TimeIsYourFriend — Sat Apr 27, 2024 7:29 am — Replies 16 — Views 2567