I had always thought that when I finally fully implement the Permanent Portfolio....that the stock portion would be the easiest to implement.
Just buy Vanguard's Total Stock Market fund. Though the below article focuses on Vanguard's S&P 500 fund....as he points out a lot of its details also somewhat apply to the Total Stock Market fund.
Do some of you rather than buying the Total Stock Market Fund...buy three index funds? Large-cap, Mid-cap, Small-cap?
Finally what do you think of his S&P 500 Equal Weight index analysis and recommendation?
Vinny
The Truth About Index Funds
https://www.kiplinger.com/investing/ind ... ndex-funds
"You may think you're diversified by buying an S&P 500 Index fund, but you're making a substantial wager on a handful of stocks
Any cap-weighted index fund is a heavy bet on larger companies. Lately, that bet has become extremely heavy because a few stocks have become gigantic. In 2011, for example, the total market cap of the 10 biggest S&P 500 stocks was $2.4 trillion. Currently, it’s $13.7 trillion. Apple itself has a cap as large today as all 10 of the largest S&P stocks combined a decade ago.
Or consider simply the five trillionaire stocks I highlighted recently. All by themselves, Alphabet (GOOGL), Amazon.com (AMZN), Apple, Facebook (FB) and Microsoft (MSFT) represent 22% of the value of the S&P 500. In recent years, those stocks have been on a tear, and the index has benefited.
Targeted Bet
You may think you are getting broad diversification by buying an S&P 500 Index fund, but you are actually making a substantial wager on a handful of stocks in the same sector. As of July 31, information technology, Apple's category, and communications services, the sector of Facebook and Alphabet, Google's parent, represent a whopping 39% of the S&P 500. By contrast, energy represents just 2.6%."
"The five trillionaire stocks represent about 18% of the asset value of Vanguard Total Stock Market (VTI), the most popular of the ETFs based on such indexes;"
"I still like the trillionaires, and I like technology, but I have decided no longer to deceive myself by thinking that most index funds tracking the S&P 500 are the best way to own the U.S. market."
"The Equal-Weight Solution
There are, however, ways to avoid loading up on a few stocks, or any one sector.
One is the S&P 500 Equal Weight Index. Each stock represents roughly 0.2% of total assets (there are actually 505 stocks in the S&P 500 Index), with rebalancing at the end of each quarter. As a result, every time the index is rebalanced, the trillionaires account for about 1% of assets; technology and communications, 20%. Over the past 10 years, the S&P 500 has beaten its equally weighted cousin by about one percentage point, annualized, but that's hardly unexpected in a great decade for big growth stocks."
"Invesco S&P 500 Equal Weight (RSP), an ETF with an expense ratio of 0.2%, offers an easy way to buy the index. Be warned that its turnover, at 24%, is much higher than a standard broad market index fund's turnover, so it's best to own it in a tax-deferred account such as an IRA."
"I'm not telling you to avoid conventional broad-market funds. Notice that I am still recommending them. I'm just saying there are other ways to get better diversification and come close to really owning the U.S. stock market."