The Four Enemies of Investing

• Inflation
• Taxes
• Your Broker
• Yourself
 The Four Pitfalls of Investing

• Too Conservative
• Too Aggressive
• Market-Timing
• Poor Delegation
 The Six Factors That Determine
Your Portfolio’s Future Value
• The Amount You Save
• The Length of Time It Compounds
• Your Asset Allocation
• Those Assets’ Annual Return
• The Expenses You Absorb
• The Taxes You Pay
 Total Nominal Return Indices
January 1802 – December 31, 2006
$10,000,000 $12.7
STOCKS mil
$1,000,000

$100,000

$10,000
BONDS $18,235
$5,060
$1,000 BILLS
$100 GOLD
$32.84
$16.84
$10
CPI
$1
Source:
Jeremy $0
1801 1811 1821 1831 1841 1851 1861 1871 1881 1891 1901 1911 1921 1931 1941 1951 1961 1971 1981 1991 2001
Siegel
The Oxford Asset Allocation Model
Real Estate
Investment
Gold Shares
Trusts
5%
5%

Inflation
Adjusted Bonds U.S. Stocks
10% 30%

High-Grade
Bonds
10%
International
High-Yield Stocks
Bonds 30%
10%
 The Gone Fishin’ Portfolio
Fund Symbol Allocation
Vanguard Total Stock Market Index VTSMX 15%
Vanguard Small Cap Index NAESX 15%
Vanguard Emerging Market Index VEIEX 10%
Vanguard European Index VEURX 10%
Vanguard Pacific Index VPACX 10%
Vanguard High Yield Corporate VWEHX 10%
Vanguard Short Term Investment Grade Bonds VFSTX 10%
Vanguard Inflation Protected Securities VIPSX 10%
Vanguard REIT Index VGSIX 5%
Vanguard Precious Metals and Mining Fund VGPMX 5%
Performance
 Market Beating Returns
Year Gone Fishin’ S&P 500
2000 -6.14% -9.11%
2001 -2.73% -11.89%
2002 -5.41% -22.10%
2003 32.72% 28.68%
2004 15.28% 10.88%
2005 11.93% 4.91%
2006 16.99% 15.80%
2007 9.68% 5.49%
2008 -31.70% -38.49%
 The Gone Fishin’ Portfolio
Exchange-Traded Funds

ETF Symbol Allocation

Vanguard Total Stock Market VTI 15%
Vanguard Small-Cap VB 15%
Vanguard European VGK 10%
Vanguard Pacific VPL 10%
Vanguard Emerging Markets VWO 10%
iShares iBoxx High Yield Corporate Bond HYG 10%
Vanguard Total Bond Market BND 10%
iShares Lehman TIPs TIP 10%
Vanguard REIT VNQ 5%
Market Vectors Gold Miners GDX 5%
 The Effects of Taxes
Non-Tax Managed Tax Managed
Start $250,000 $250,000
5 $350,638 $421,265
10 $491,788 $709,855
15 $689,758 $1,196,147
20 $967,421 $2,015,578
25 $1,356,858 $3,396,366
30 $1,903,064 $5,723,074