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Re: My 2015 ETF IRA purchase date: 30 DEC 2014

tyler - you're welcome If you are pushing it, why not push all the way? If you like a wider margin, what's another day, or two, or three? Although no so in 2014, when the first trading day of the year is an up day and you will see many comments in threads in this forum lamenting the fact that they m...
by BBL
Wed Nov 19, 2014 6:43 am
 
Forum: Investing - Theory, News & General
Topic: My 2015 ETF IRA purchase date: 30 DEC 2014
Replies: 3
Views: 756

My 2015 ETF IRA purchase date: 30 DEC 2014

Be advised: I’m presenting this strategy (again) for that small population of posters & lurkers who will find this potentially actionable. If you’re big on the ‘time in market’ concept then here are, potentially, a couple of extra days for you to enjoy. This is minutia in the extreme . You have ...
by BBL
Tue Nov 18, 2014 8:25 am
 
Forum: Investing - Theory, News & General
Topic: My 2015 ETF IRA purchase date: 30 DEC 2014
Replies: 3
Views: 756

Re: Vanguard ETF vs. Mutual Fund when expenses equal

For TLH purposes the frequent trading restrictions on the MF share class can be an annoyance. Mr.Bogle often brings up the fact that ETF's are designed for "trading", and may lure some people into more trading than they might do otherwise. He's expressed that opinion many times. Vanguard c...
by BBL
Fri Nov 14, 2014 9:14 am
 
Forum: Investing - Help with Personal Investments
Topic: Vanguard ETF vs. Mutual Fund when expenses equal
Replies: 27
Views: 1778

Re: Should I avoid buying Vanguard ETFs?

Comments in this thread appear to suggest that a fund lacking the ETF share class has no method available to avoid taking gains due to redemptions. That isn’t the case. In-kind is helpful in tax management across the portfolio and its use is substantially enhanced by the ETF share class; yet it isn’...
by BBL
Thu Nov 13, 2014 8:35 am
 
Forum: Investing - Help with Personal Investments
Topic: Should I avoid buying Vanguard ETFs?
Replies: 12
Views: 1553

Re: Cash - Throw it on the table!

More than 15Y expenses in cash equivalents as defined by the OP.
by BBL
Wed Nov 05, 2014 10:38 am
 
Forum: Personal Finance (Not Investing)
Topic: Cash - Throw it all on the table!!!
Replies: 51
Views: 3755

Re: Market return and elections

My father-in-law was a big believer in market cycles being related to elections. ...he specifically believed that the first two years after a presidential cycle election, the market was lousy. He also believed that the market did well after a mid-term election. So, what do you think about this? Wha...
by BBL
Wed Nov 05, 2014 9:26 am
 
Forum: Investing - Theory, News & General
Topic: Market return and elections
Replies: 7
Views: 912

Re: Small Cap Tilting

Although we have probably provided some interesting information (or at least our takes on it) I doubt that continuing this is all that productive or valuable so I’ll give it a rest after this post. It doesn't seem to effect composition or performance hardly at all. They're good at it. If they weren'...
by BBL
Wed Mar 12, 2014 7:02 am
 
Forum: Investing - Theory, News & General
Topic: Small Cap Tilting
Replies: 84
Views: 9518

Re: Small Cap Tilting

To be fair, VTMSX has had as much historical variability in its factor loads as NAESX/VSMAX, over time, despite tracking a single index. Perhaps the differences over time have more to do with shifts in the market in general. That being said (and this is an honest question to which I feel perplexed ...
by BBL
Tue Mar 11, 2014 7:35 am
 
Forum: Investing - Theory, News & General
Topic: Small Cap Tilting
Replies: 84
Views: 9518

Re: Small Cap Tilting

Returns matter since we don't invest - at least no one I know - just to practice how to run factor loadings. I also don't see a glaring difference in return . VTMSX has taken less of a beating in declines, but lower increase in a rebound (2002/03, 2008/09, 2011/12). ** VSMAX inception 11/13/2000 VT...
by BBL
Mon Mar 10, 2014 9:34 am
 
Forum: Investing - Theory, News & General
Topic: Small Cap Tilting
Replies: 84
Views: 9518

Re: Small Cap Tilting

The investor that is targeting particular factor loads for their porfolio, within practical and individual constraints, would be wise to consider VTMSX as an instrument that can give them exposure to the smaller deciles that VSMAX doesn't. The investor may even use a combination of the two depending...
by BBL
Sat Mar 08, 2014 9:02 am
 
Forum: Investing - Theory, News & General
Topic: Small Cap Tilting
Replies: 84
Views: 9518

Re: IJS bid/ask

After hours quotes aren't useful. If you look at morningstar right now it shows bid 109.61/ask 300.00. If you want to buy it look about 60-90 minutes into the next trading day and you will see something much more realistic. on 03/06 the last trade was 114.25, the NAV was 114.17, the mid point was 11...
by BBL
Fri Mar 07, 2014 6:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: IJS bid/ask
Replies: 4
Views: 263

Re: Small Cap Tilting

I'm not sure why a tracking-index change would be an additional risk Different targets have different factor exposures and a mid course change from one to the other will result in factor exposure changes for the index investor and that adds an element of luck into the equation from the transitional...
by BBL
Fri Mar 07, 2014 7:51 am
 
Forum: Investing - Theory, News & General
Topic: Small Cap Tilting
Replies: 84
Views: 9518

Re: Small Cap Tilting

The last post of the thread also points out that NAESX has had five different incarnations, starting as an active fund in 1960, becoming a Vanguard active fund in 1989, later tracking the Russell 2000, then the MSCI, now the CRSP. So, as I've been saying, the history of its past returns in a bit of...
by BBL
Fri Mar 07, 2014 7:21 am
 
Forum: Investing - Theory, News & General
Topic: Small Cap Tilting
Replies: 84
Views: 9518

Re: Small Cap Tilting

Not really the point but as some issue has been made of the relative performance of VISGX, NAESX and VISVX, note that since inception in 1999 VTMSX it outperforms the other three choices easily . On the other hand, if you look at the Morningstar's growth chart for VTMSX and compare it to VISVX and ...
by BBL
Fri Mar 07, 2014 6:45 am
 
Forum: Investing - Theory, News & General
Topic: Small Cap Tilting
Replies: 84
Views: 9518

Re: Confusion about reinvesting dividends in taxable

Let's say I make five purchases of TSM a few months apart at different prices. Then TSM declines in value a bit below the highest cost lot. So I could sell that lot and get a small loss. But if I had used avg cost basis, I still might have a small average gain, so I couldn't harvest anything. Is th...
by BBL
Thu Mar 06, 2014 5:55 pm
 
Forum: Investing - Help with Personal Investments
Topic: Confusion about reinvesting dividends in taxable
Replies: 37
Views: 2515

Re: Developed Markets Fund Merger

IMO the final distribution will be small. This fund distributed annually and that just happened in December. Even the broad VG international funds that started paying on a quarterly basis distribute a very small dividend first quarter - a good proxy for the income on their books first quarter. IMO a...
by BBL
Thu Mar 06, 2014 5:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: Developed Markets Fund Merger
Replies: 7
Views: 1255

Re: Small Cap Tilting

Wow, I did not consider checking the M* box on VTMSX. I had no idea it would have a much stronger tilt than VSMAX. I feel like the tax managed funds don't get talked about much around here. Is there a reason for that? Is it the higher ER? What exactly makes them more tax efficient than the non tax-...
by BBL
Thu Mar 06, 2014 2:46 pm
 
Forum: Investing - Theory, News & General
Topic: Small Cap Tilting
Replies: 84
Views: 9518

Re: Developed Markets Fund Merger

From that .pdf you attached: "The proposed exchange of shares is expected to be accomplished on a tax-free basis. Accordingly, we anticipate that Developed Markets Fund shareholders will not realize any capital gains or losses from the reorganization . However, you should pay close attention to...
by BBL
Thu Mar 06, 2014 2:26 pm
 
Forum: Investing - Help with Personal Investments
Topic: Developed Markets Fund Merger
Replies: 7
Views: 1255

Re: How Many Funds Do You Have in Taxable?

Edit: Duplicate
by BBL
Thu Mar 06, 2014 12:06 pm
 
Forum: Investing - Theory, News & General
Topic: How Many Funds Do You Have in Taxable?
Replies: 97
Views: 5592

Re: How Many Funds Do You Have in Taxable?

But I still get the impression that high number of fund people (now 41) are less represented or at least less verbose . There isn't much to say. I have to scroll quite a bit on my VG 'balances & holdings' page (maybe 3-4 pages worth). This is a product of path dependency, time and using individ...
by BBL
Thu Mar 06, 2014 11:13 am
 
Forum: Investing - Theory, News & General
Topic: How Many Funds Do You Have in Taxable?
Replies: 97
Views: 5592

Re: Small Cap Tilting

The OP is considering a size tilt. Maybe I’m having a middle aged moment but I didn’t notice a single mention of Vanguard’s Tax Managed Small Cap fund VTMSX in this thread. Especially for a taxable account, a VG investor that has 10K, wants a blend fund (but not an ETF) to tilt to SmB and wants a co...
by BBL
Thu Mar 06, 2014 10:27 am
 
Forum: Investing - Theory, News & General
Topic: Small Cap Tilting
Replies: 84
Views: 9518

Re: The Price of Outperformance

MnD - This paper is a few years old but the authors include Dodge & Cox Stock as one of the funds for which the proposed attribution model is used. You might find it interesting. “The allocation effect summarizes the total value added from the manager’s static allocation to industry sectors, val...
by BBL
Wed Mar 05, 2014 10:55 am
 
Forum: Investing - Theory, News & General
Topic: The Price of Outperformance
Replies: 35
Views: 3696

Re: small cap value tax shuffle advice

livesoft wrote:I think VEA may be more tax efficient for me because I get the foreign tax credit.


I could see that. I'm curious how tax efficient VEA will remain from 2014 forward. We'll see.
by BBL
Wed Mar 05, 2014 10:14 am
 
Forum: Investing - Theory, News & General
Topic: small cap value tax shuffle advice
Replies: 12
Views: 558

Re: small cap value tax shuffle advice

0.87/95.61 = "yield" = 0.91% 0.91 *( 0.8685 * 0.27 + 0.1315 * .37) = 0.26% At your marginal div rates VIOV remains remarkably (absolutely; comparatively) tax efficient. It was my most tax efficient equity holding (again). The only thing more tax efficient are blown trades but the returns ...
by BBL
Wed Mar 05, 2014 10:09 am
 
Forum: Investing - Theory, News & General
Topic: small cap value tax shuffle advice
Replies: 12
Views: 558

Re: small cap value tax shuffle advice

OK, I think this is all you will need....

One EOY distribution (div only of) $0.8700
Dividend was 86.85% QDI

Closing price on 12/31/2013: 95.61
Closing NAV on 12/31/2013: 95.59

Thanks!
by BBL
Wed Mar 05, 2014 9:14 am
 
Forum: Investing - Theory, News & General
Topic: small cap value tax shuffle advice
Replies: 12
Views: 558

Re: small cap value tax shuffle advice

So the bottom line is that holding Small-cap Value Index fund in taxable cost me 0.1% more than holding a very tax efficient large-cap index fund in taxable. I must write that the 0.1% difference is practically insignificant given the differences in both expected returns and in actual returns. Also...
by BBL
Wed Mar 05, 2014 7:58 am
 
Forum: Investing - Theory, News & General
Topic: small cap value tax shuffle advice
Replies: 12
Views: 558

Re: Dividends as a measure of value

Privately held company or publicly traded?
by BBL
Tue Mar 04, 2014 2:39 pm
 
Forum: Investing - Theory, News & General
Topic: Dividends as a measure of value
Replies: 17
Views: 708

Re: question about the consequence of reinvesting dividends

Yes, default vs election is a nuanced point.* There is a one-year limit to elect away from the default, but the firms can extend the period. Vanguard has chosen to extend it indefinitely. A prior sale at the default of average basis would have locked things in. * The original regs made the distinct...
by BBL
Tue Mar 04, 2014 12:32 pm
 
Forum: Investing - Theory, News & General
Topic: question about the consequence of reinvesting dividends
Replies: 20
Views: 1257

Re: question about the consequence of reinvesting dividends

Maybe I don't understand one of the more nuanced points being made in this thread but FWIW: Last week I set the cost basis on a taxable VG account (not mine) to spec id where no prior election had been made. It took a day or two but the result is that all lots in that account, going back to 01 Jan 2...
by BBL
Tue Mar 04, 2014 12:13 pm
 
Forum: Investing - Theory, News & General
Topic: question about the consequence of reinvesting dividends
Replies: 20
Views: 1257

Re: The Price of Outperformance

This seems to be further evidence for the claim made earlier: Even when managers can regularly achieve a bit of out-performance, the outperformance goes to the managers, not the owners of the fund. Right. You need to be the alpha producer , not find the alpha producer . If you can do it you won't j...
by BBL
Mon Mar 03, 2014 5:47 pm
 
Forum: Investing - Theory, News & General
Topic: The Price of Outperformance
Replies: 35
Views: 3696

Re: Good Russian ETF

baw703916 wrote:Touché. That will certainly produce results, although I have no idea if they will be the kind one wants. :)


No doubt about it. You will get somewhere in a hurry. The neophyte enamored with IBs low margin rates might find out the hard way what that auto liquidation clause really means. Ouch.
by BBL
Mon Mar 03, 2014 2:19 pm
 
Forum: Investing - Help with Personal Investments
Topic: Good Russian ETF
Replies: 15
Views: 1406

Re: Good Russian ETF

If you’re going to speculate (not invest) why bother with diversification? You want results and you get those with concentration and leverage. Evidently you didn’t already buy RUSS up to your margin limitation? So far it is +19% or so today (not accounting for the effect of margin). Or you could hav...
by BBL
Mon Mar 03, 2014 1:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: Good Russian ETF
Replies: 15
Views: 1406

Re: VWO vs VEMAX

Are you sure your numbers are correct? Last I looked VWO was around $39 or so. What did I miss? I changed the table - don't ask me why I put dollar signs in front (habit, I guess). Those are price/NAV returns based on the past 5 years. Price returned 16.38% annually NAV returned 16.44% annually htt...
by BBL
Fri Feb 28, 2014 12:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: VWO vs VEMAX
Replies: 33
Views: 1240

Re: VWO vs VEMAX

When you buy/sell the ETF, the price ≠ NAV. You get what you get! http://performance.morningstar.com/funds/etf/performance-price.action?t=VWO&region=usa&culture=en-US&ownerCountry=USA VWO Closing Price NAV 1/02/2014 $63.79 $65.43 1/30/2014 $52.88 $56.73 2/27/2014 $57.35 $59.02 Exactly. ...
by BBL
Fri Feb 28, 2014 10:38 am
 
Forum: Investing - Help with Personal Investments
Topic: VWO vs VEMAX
Replies: 33
Views: 1240

Re: VWO vs VEMAX

For the investor contemplating whether to use a VG ETF or the Admiral share class, it is counterproductive to use the expected long term return difference (there won’t really be any) in the decision process or as livesoft mentions, any consideration of an expected difference in tax efficiency. For t...
by BBL
Fri Feb 28, 2014 6:51 am
 
Forum: Investing - Help with Personal Investments
Topic: VWO vs VEMAX
Replies: 33
Views: 1240

Re: VIOV ... or VBR? Decisions, Decisions

I do own RZV in my Roth. I've owned both JKL and RZV since mid 2008 (before the crash). At that time I wasn't sure what the turnover of RZV would be, and whether it would be forced to distribute capital gains. Also the AUM at that time was tiny (<$20 million IIRC), and I had doubts as to whether th...
by BBL
Fri Feb 28, 2014 6:16 am
 
Forum: Investing - Help with Personal Investments
Topic: VIOV ... or VBR? Decisions, Decisions
Replies: 33
Views: 2925

Re: VWO vs VEMAX

Take the ETF and MF share class down to a NAV only comparison YTD through 02/26: VWO: NAV YTD: -5.39 VEMAX: NAV YTD: -5.39 But retail investors can't buy ETFs at NAV. They can only buy at market price. So while it's nice to see that the NAV of VWO tracks VEMAX, it's the comparison of VWO's market p...
by BBL
Thu Feb 27, 2014 2:44 pm
 
Forum: Investing - Help with Personal Investments
Topic: VWO vs VEMAX
Replies: 33
Views: 1240

Re: VWO vs VEMAX

VWO, being an ETF, has a premium/discount and a bid/ask spread, which can make a difference in the short term. It's also priced at a slightly different moment in time, 4pm last trade vs 5pm mutual fund NAV, when some foreign markets are open. However, because they are the exact same entity undernea...
by BBL
Thu Feb 27, 2014 2:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: VWO vs VEMAX
Replies: 33
Views: 1240

Re: VWO vs VEMAX

I would suggest that you check again. When I looked, they both have performed the same within experimental error. Maybe the website you use to check things is giving you bad info? As Landy showed, Vanguard's own return data shows material deviation between market price and NAV of VWO. While NAV of ...
by BBL
Thu Feb 27, 2014 2:17 pm
 
Forum: Investing - Help with Personal Investments
Topic: VWO vs VEMAX
Replies: 33
Views: 1240

Re: VIOV ... or VBR? Decisions, Decisions

For the record, I chose the ishares ETF JKL, which follows the Morningstar Index, for my SV in taxable 0 0 0 10 4 2 62 18 4 I'm not sure why this ETF hasn't caught on more ... What about JKL do you find appealing? As far as a deep value option goes It doesn't do too much for me as long as RZV is av...
by BBL
Thu Feb 27, 2014 11:57 am
 
Forum: Investing - Help with Personal Investments
Topic: VIOV ... or VBR? Decisions, Decisions
Replies: 33
Views: 2925

Re: What to do before 2015 Tax/IRA season

No TSP? I wouldn't forego that opportunity. Opening and funding a TSP is a way for you to expand your tax advantaged space and get some of the excess cash into your index portfolio now. You can contribute more than you can really afford for a while and use the cash on hand to help pay your expenses ...
by BBL
Wed Feb 26, 2014 6:15 pm
 
Forum: Investing - Help with Personal Investments
Topic: What to do before 2015 Tax/IRA season
Replies: 7
Views: 1079

Re: Funds for taxable account

Another alternative you might consider is exchanging the international in your ROTH into the other existing ROTH funds and then adding the international into your taxable account. Add TISM and TLH with FTSE Large. Right now you’re giving up the FTC and the higher volatility of international by locat...
by BBL
Wed Feb 26, 2014 1:50 pm
 
Forum: Investing - Help with Personal Investments
Topic: Funds for taxable account
Replies: 10
Views: 860

Re: Funds for taxable account

My concern is that large cap fund, VLACX and FVINX, are considered substantially identical. Is it substantially identical? What does substantially identical means? VLCAX and VFINX are not substantially identical. They do not track the same index, have a meaningfully different number of securities (...
by BBL
Wed Feb 26, 2014 1:32 pm
 
Forum: Investing - Help with Personal Investments
Topic: Funds for taxable account
Replies: 10
Views: 860

Re: Funds for taxable account

Yes, my periodic contribution will cause wash sale. VIIIX tracks SP500, so I cannot have VFINX in my taxable. My concern is that large cap fund, VLACX and FVINX, are considered substantially identical. Is it substantially identical? What does substantially identical means? Pardon me – I missed a sy...
by BBL
Wed Feb 26, 2014 1:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: Funds for taxable account
Replies: 10
Views: 860

Re: Funds for taxable account

For my taxable account, I was planning to get VTSMX, but I am intrigued with Tax Lost Harvesting. Since I make periodic contribution to my 401(k), it is quite difficult to do TLH with SP500 funds or Extended market in taxable. Do you have any suggestion for good tax efficient funds to get in taxabl...
by BBL
Wed Feb 26, 2014 10:35 am
 
Forum: Investing - Help with Personal Investments
Topic: Funds for taxable account
Replies: 10
Views: 860

Re: Ding! Check engine light is now on. [PE10 exceeds 25]

With respect to various valuation methodologies - here is a paper from GMO by James Montier. You have to sign up to see. CAPE Crusader RM RM – I’m able to access that paper from the link you provide without being logged into GMO so perhaps unregistered users can access it to. Did you happen to read...
by BBL
Wed Feb 26, 2014 9:31 am
 
Forum: Investing - Theory, News & General
Topic: Ding! Check engine light is now on. [PE10 exceeds 25]
Replies: 108
Views: 11286

Re: VIOV ... or VBR? Decisions, Decisions

I prefer VBR (CRSP index). VIOV (S&P index) has smaller-cap and more value-oriented stock, so you need less of VIOV to get the same small-cap value effect. I would expect 2/3 VIOV and 1/3 VTI (Total Stock Market Index) to perform similarly to VBR, but it would be more expensive. (The real expen...
by BBL
Wed Feb 26, 2014 7:15 am
 
Forum: Investing - Help with Personal Investments
Topic: VIOV ... or VBR? Decisions, Decisions
Replies: 33
Views: 2925

Re: ETF Muni bond allocation

A tax efficiency note: some Preferred issues’ distributions are QDI / DRD eligible. The relevant difference is between trust preferred (traditional trust preferred / enhanced trust preferred) and traditional preferred stock. Traditional Trust Preferred was usually issued by banks for long (30 year) ...
by BBL
Tue Feb 25, 2014 1:22 pm
 
Forum: Investing - Help with Personal Investments
Topic: ETF Muni bond allocation
Replies: 30
Views: 1901

Re: Sell/Buy ETF, T+3?

No problem. I wouldn't worry about the counterparty coming through on their side. If their broker let them execute the trade then that's their (the brokers) problem - firms are required to settle transactions. The counterparty might not be in good standing with their broker for very long but that's ...
by BBL
Thu Feb 20, 2014 3:02 pm
 
Forum: Investing - Theory, News & General
Topic: Sell/Buy ETF, T+3?
Replies: 7
Views: 446

Re: Sell/Buy ETF, T+3?

Say you want to sell $1K of VXUS (international stock) ETF then buy $1K of VTI (domestic stock) ETF on the same day. OK From my understating you can this as long as you don't sell VTI until after the settlement date of T+3 of VXUS, selling VTI before the settlement date of T+3 is not allowed and is...
by BBL
Thu Feb 20, 2014 1:06 pm
 
Forum: Investing - Theory, News & General
Topic: Sell/Buy ETF, T+3?
Replies: 7
Views: 446
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