Ask HN: I have $450K cash, what should I do to maximize my return?

The shorter the timeframe that the money is needed, the higher the allocation to bonds. Vanguard has (in Canada) a bunch of 'all-in-one' ETFs that have as their holdings other ETFs in various asset groups: Canadian equity, US equity, international equity, bonds.

Shortly after they were announced, someone back-tested their returns to determine which of the offerings a person should get:

> I analyzed hypothetical Vanguard asset allocation ETF performance over the past 20 years ending June 2019, and here’s what I found:

> The worst 1- and 2-year periods were negative for all five ETFs.* [i.e., put it in term deposit to at least try to keep up with inflation]

> The worst 3-year period was negative for all ETFs except the Conservative Income ETF Portfolio (VCIP), which holds 80% in bonds; even still, VCIP only returned 1%.

> The worst 4-year period was negative for all ETFs except VCIP and the Conservative ETF Portfolio (VCNS) [60% bonds]. But these only returned 2.2% and 0.2% respectively.

> Looking further out:

> If you need the cash in 5–9 years, VCIP or VCNS should be the only Vanguard asset allocation ETFs on your radar. Even the Balanced ETF Portfolio (VBAL) [40% bonds], which allocates 60% to stocks, returned only 0.3% over its worst 9-year period.

> If you won’t need the cash for 10–14 years, VBAL could be an appropriate choice, as even its worst 10-year return during this period was around 2%.

> If you don’t need the cash for 15–19 years, you could look at a more aggressive ETF, like the Growth ETF Portfolio (VGRO). [20% bonds]

> If you’re investing for 20 years or more (and you are comfortable dialing up your portfolio risk to eleven), the All-Equity ETF Portfolio (VEQT) might be right up your alley. [0% bonds, 100% equities]

* https://www.canadianportfoliomanagerblog.com/choosing-your-i...

Note: if you're looking at long time-horizons (e.g., retirement in 20 years), and you can take higher risks, does not mean you have to: you need to first determine what your goal is (e.g., how big of a pot of money you need), and then work backwards from there to determine what kind of returns are needed to get there. If you need 'only' 3% returns, it probably is not necessary to take on extra risk to chase after 6%.

So I’m walking my talk.

My random suggestion here is diversify in to a few different equities areas. US, international, etc. I mostly have a few 'general market' funds, but a couple that are focused on tech companies, and they've outpaced the general market over the last several years.

Keep some in cash - ally and others have around 1% return on cash. not great, but it's something. keep maybe $80k or so in there.

put some in general 'broad market' index funds - total market or S&P or something - maybe $150k in that.

find some international funds - put $80k in that.

pick a precious metals fund - put $40k in that. Alternative, take some of that and put in to crypto if you've got an interest in that.

This would leave you with around $150k. Consider some more real estate - perhaps just land and let it appreciate, or a small house you can use as a rental, or more industrial. Or just hold that in cash for a bit longer while you wait and see what happens. You already have $200k in industrial real estate. If you're comfortable with that, and you're getting a return that from area, increase your exposure there.

Watch the investments - readjust portions to your comfort level - perhaps every 3-6 months - as things change. Keeping cash will give you some cushion if there's a downturn, either to weather a storm, or give you some ability to throw a bit more in to a specific market.

There's no rule that says you have to put it all in one index fund right now. You're in a fortunate position, and can afford to take this slowly, and spend time learning more about these various instruments before blindly throwing in hundreds of thousands of dollars.

Part of that learning can (and probably should) be meeting with a fee-only advisor who can review your situation in more detail and give you a more comprehensive set of recommendations more suited to those aspects we can't tell from your post (risk tolerance, life goals, etc).