No. of Recommendations: 11
Man, that RSP return is quite depressing.
The instructions in my will are to liquidate all my positions, including a pretty big slug of Berkshire, and put the equity position in RSP.
My reasoning?
I don't know how Berkshire will unfold, and I won't be here to watch it, so it makes sense to put the money into a broad-based index fund where less watching is required.
The obvious answer is the S&P 500, but I have a general disdain for it, which feels quite contrarian these days, and so the next best option is RSP.
The return won't be the best, but also won't be the worst, which is the middling option I'm looking for.
The return of an equal-weight index like the RSP, over the long-term, is almost certain to be better than the cap-weighted equivalent like the S&P500. And the best time to invest in RSP is when the S&P500 has gotten way ahead of the RSP, like right now. In fact, the very best time is probably when that S&P's outperformance has been so dramatic, and has been going on for such a long time, that people are throwing in the towel and switching back from the losing RSP to the winning S&P, or, perhaps as in your case, just resigning themselves to getting RSP's middling returns forever!
