I am back to a question that I still have not been able to answer comfortably.
I am a Flagship member with Vanguard and also invest with Schwab. In a retirement account with Schwab I currently hold SGOVX. In a different retirement account at Schwab I hold MAPIX and MACSX. In my taxable account with Schwab I hold ARTKX. I currently do not hold an international fund at Vanguard.
My plan within the six months to a year is to increase my international exposure. I am not looking to make any changes with MAPIX or MACSX.
I hold SGOVX in a retirement account because it is fairly tax inefficient. The problem is, I am out of room in that account and also want more mid cap value exposure, which I can satisfy by selling SGOVX and adding to my ARTQX position in that same account. Of course, when I do this, not only am I not increasing my international exposure, I am decreasing it.
One potential solution is to add to ARTKX, which historically seems to have been fairly tax efficient. The two issues with doing this is besides MAPIX and MACSX, I would be putting over 60% of my international exposure in one fund. Also, per M* ARTKX has about a 25% potential capital gains exposure.
A second way I could go is to purchase UMBWX at either Schwab or Vanguard. It's long term performance has been good, its expense ratio seems reasonable (18 basis points below ARTKX), it's been fairly tax efficient, and it seems like it would be a complement to ARTKX because it has an average market cap about three times the size of ARTKX. However, UMBWX has a potential capital gains exposure of about 19%.
A third way to go is to purchase VGSTX at Vanguard and call it quits ;-). It's tax efficient, it has a low expense ratio at 16 basis points, a low capital gains exposure at about 5%, and a an average market cap about twice ARTKX. However, while about 50% of my domestic exposure is in index funds, I have not been a big fan of indexing international.
With the above in mind, I certainly would appreciate some thoughts.