Bogleheads.org

. . . does more of what I wanted which is to zig when stocks zag. What, exactly, does this mean? Diversification in general and Modern Portfolio Theory in particular rely on the idea of holding divergent assets. The most classic example is that Stocks don't move the same as bonds. You can explore t...

Look for a hammer or doji candle under the bollinger band midline for a good signal. The macd line should be under the signal line for it to be a good entry. Should I be breaking out the champagne, or lining up for a quarter pounder and fries? That would depend on whether I turn out to be right and...

Honobob wrote:My point was where do you pay $14,000 annual property tax on a $120,000 house.

Yeah, that's crazy high.

For $50k, I'd lump sum. For $5 Million I'd probably DCA. Sure, the math mostly works better for lump sum but I'd be willing trade some upside to avoid "worst possible time" syndrome on a large amount. So, if you had $5 mil in right now, you'd withdraw it all, put it in cash, and DCA back ...

For $50k, I'd lump sum. For $5 Million I'd probably DCA. Sure, the math mostly works better for lump sum but I'd be willing trade some upside to avoid "worst possible time" syndrome on a large amount.

Honobob wrote:Waitaminnit! Your house is worth $100 a square foot!

Both my places are worth more than that, but of course it's highly dependent on your local market. (No, we don't live in a McMansion)

I try to use the Pareto principle when trimming expenses, after all you get way more bang for the buck by living in a cheaper house than you do by re-roasting your coffee grounds or some such. In no particular order: 1) I hang out on Bogleheads where I get great advice on a variety of subjects for F...

larryswedroe wrote:hexdump
I agree. The key was to move UP the income statement to gross profitability--not using earnings.
Larry

That doesn't surprise me, earnings are usually "managed".

However, while I've owned TIPS for around 6 years and have done well with them, I'm not even sure why I own them. You should have a clearly defined reason for each holding in your portfolio. If you don't know why you own something either A)Figure it out or B)Get rid of it. TIPS give you inflation p...

Politely explain that his mean-variance optimizer appears to be broken and that you'll be looking elsewhere until it's fixed.

I've found that holding a diversified collection of Gibson Les Pauls, well kept amplifiers, and analog pro-audio is an excellent diversifer for stocks & bonds. Rebalancing can be fun. Just kidding, sort of. These "hard assets" may be less liquid, but they are certainly less flawed tha...

I do think today marks the start of some type of downturn. But I will still stick to the plan, as I know I can't market time. I'd argue that it's a pullback amidst an up trend. Short term it's probably a buy point, today is probably not the optimum entry but here in the next few days. Look for a ha...

If you're going to add commodities I like something like GCC, which is an equal weight index since it tends to be less overpowered by oil and other energy commodities. In general I prefer something less pro-cyclical so I find that focusing on gold as my commodity allocation does more of what I wante...

Rent equivalence and cost to build are also good comparisons.

If you do buy a ticket, you have a 100,000,000:1 or so probability of not having that $2 on Sunday morning. That's not true. Overall odds of winning a prize are 1:31.8464 Minimum prize is $4. It's still gambling with an expected return lower than the purchase price, but your odds of having $2 on Su...

Assuming we're talking about a well diversified portfolio that invests globally, let's imagine for a moment what would happen if it did not: 1) If the global market stagnates or goes down over a long period that means that wealth is not being created or is even being destroyed 2) Capitalism does not...

Immerse yourself in it until you build up your immunity. Agreed with the G. Gordon Liddy approach. Boredom follows in time. Then it's on to other things. This. The more you know about how it all works, the more you'll realize you have very little control other than your savings rate and asset alloc...

Cramer's show has several different parts, they're not all of the same utility. The best part is the first five to ten minutes where explains things and describes what's going on, I learned a ton from him by just watching that part of the show. The am I diversified segment is useful in that most of ...

Point and Figure target is 1800 so today is likely not the high. PE10 is 24.37 which is high but not really bubble territory. We could always have a major correction but at the moment it's not seeming likely short to medium term. It's mostly up to the Fed right now, absent some sort of market shock ...

No need to buy TLT or GLD (except relatively small slices for rebalancing). Just buy 30 year Treasuries at auction and buy this: http://www.time.com/time/specials/packages/article/0,28804,2016258_2016259_2016264,00.html Hah, that's funny but I don't want that much value sitting around my house, too...

Proposal style doesn't have to be expensive. I proposed on horseback on top of mountain lookout while we were riding her favorite trail. (she's a huge horse fan)

For amusement value I looked up the daily trade values for my funds and realized I'd have to spread out my purchases if I didn't want to move the market: VBR $17.6 million VWO $757.1 million TLT $937.6 million GLD $1857.7 million So I guess dollar cost averaging is the way to go if you're going to p...

I hold 20% in gold right now. Sure, tracking error can be annoying in periods like now where the market is zooming upwards, but it was great in August 2011 when the market plunged and my portfolio didn't. If you can't handle tracking error, don't buy alternative assets. The Fed is talking about tape...

I'd take cash and I'd break it down into five chunks:

1) Annuities
2) Portfolio
3) Real Estate
4) Business
5) Spending money

Might go buy a ticket today, I usually indulge when the jackpot is larger than the odds of winning. It's an entertainment expense.

vpotus wrote:I believe I have a 65% allocation to stocks. I value all input and will eventually make the changes at Vanguard. Thank you.

Sorry, stupid math error on my part due to the fact that the bonds are in the middle. 65% is correct.

wholeinone04 wrote:Thanks for the advice. I see the majority is definitely in favor of selling my condo but I really haven't seen many good reasons as to why.

Condos make bad rentals would be my #1 reason.

You have an 80% allocation to stocks, remember that a 50% crash is a likely occurrence so you should be mentally ready to handle a 40% drop in your total portfolio value. A more conventional risk amount would be 54% in stocks. Since you have a state pension available, you have more capability to tak...

Without knowing your age it's hard to know if your risk level is correct. Out of curiosity why are you weighting the US so heavily?

Not to pile on, but it's up .51% today and futures indicate (at this point) another up day tomorrow. I never had any luck with using prior day futures as an indicator. The hour before opening they weren't too bad for predicting what would happen at the open, but otherwise I couldn't glean much valu...

First, if a person believes this [nonsense --admin LadyGeek] and follows it, then they apparently are guaranteed to profit better than anyone else on earth (even after paying fees). Second, if guaranteed isn't the right word, then something higher than 98.6% must be guaranteed. [Snarky comment remo...

FYI, I think we're looking at a pullback here in the next few days. Rally probably isn't over so it should make a decent buy point. (P&F 1800 target still) Somewhere medium to long term we're looking at a correction but the market has a ways to run before that happens. Pullback indicator signals...

The idea that beaten down companies that are still profitable are good investments isn't controversial to me. I do find it amusing however that the statistical models seem to be heading towards the way I used to invest actively. Does anyone have any data on the size and volatility of the momentum an...

Reading has profoundly influenced my life, though not normally through a single work but more as painting a broad canvas that expanded my horizons. However, there is one piece of material that did literally change my life and that's "No money down" by Carlton Sheets. It convinced me that t...

I like rentals, however since it's a condo you should sell.

It will never move outside that channel again. Unless there are noisier events and outliers in the future. Looks like after today we are near the top of the channel. Is that a short term exuberance event or do we recalibrate and start looking at 10-day MA's over a shorter term time frame? The origi...

So I grabbed a breakdown from here (to save time): http://www.calculatinginvestor.com/2011/01/16/fama-french-etfs/ Fund Alpha FF-Beta FF-s (size) FF-h (value) R-squared SPY -0.087% 0.96 -0.13 0.012 0.986 So if the three factor model is explaining 98.6%, how much can momentum and profitability really...

Another warning light just kicked on today: http://www.cnbc.com/id/100732916 When Cramer the perma-bull begins wondering about a bull run you know things are starting to get a bit out of whack. That doesn't mean it's time to pull out of the market though, instead we're probably on the verge of "...

LFKB wrote:Also, I don't like the idea of holding cash in excess of an emergency fund.

By holding both long term treasuries and "cash" you're basically getting an average duration around 8.7 or so. Is that higher than AGG at 4.8? Sure, but it's not a crazy as it looks at first glance.

linguini wrote:To deal with unexpected supply-side shocks, why gold as opposed to some sort of diversified commodities basket?

My personal research suggested that most commodities are pro-cyclical rather than counter-cyclical the way gold is.

If you're renting to $1325 why is switching to a mortgage costing more than twice that a good move?

The FHA calculator seems to think you can afford it:

http://www.fha.com/calculator_borrow

Current market conditions don't seem to warrant such an extreme response. You've eliminated crash risk but now you're earning negative real returns.

7% real is too optimistic, 7% nominal is probably a bit low.

I already talked about this issue in a previous thread:
http://www.bogleheads.org/forum/viewtopic.php?f=10&t=97562&hilit=+productivity#p1409785

Or is downside moderation a marketing fiction? Once you start venturing outside of the options outlined above, yes, it's mostly marketing fiction. I would disagree, however I would say that often times the protection is expensive and may not be something you can easily incorporate into a regular bu...

Do you have a chest freezer? It seems almost mandatory for anyone doing paleo :) We'll be in the market soon, because between what our garden produces and what my vegetable breeder fiancee gets for free from work, there's a lot we want to freeze (smoked anchos, various chopped veggies, lots of toma...

I am in the camp of "valuations clearly predict likelihood of future returns, but only at the extremes." There is a broad middle range where PE10 is not helpful. At the extremes, I am a strong proponent. This is my position as well. I use it as an irrationality detector not a traditional ...

John3754 wrote:Forgive me I'm an unsophisticated investor...equities are "overvalued" and bonds are in a "bubble", so where's my money supposed to go at present?

Derivatives of course!

Getting back to food costs - they are definitely up since I last posted, think we're averaging closer to $450-$500 a month these days. The biggest culprits - meat,chicken and fresh produce. Beef is starting to get a bit ridiculous and I'm starting to wonder if I want to spend the kind of money they...

If you head over to the forum I posted above, you'll learn about the 50%/2% rule. I had to look that one up. So first, I'd like to totally agree that many aspiring landlords totally space on costs other than the mortgage and that operating expenses are a big deal. Second, this rule looks totally bo...

If you can't fully pay off your mortgage then paying it down is not a good plan. If you've never owned a rental before then for heavens sake don't buy two at once, that's a pool you want to dip your toe into first before diving in. My advice is find one rental that looks good on paper and purchase i...

I think I'd be more like to use some form of monte carlo analysis so that I could see the effects of sequence issues. Try to break everything down into separate categories and make different projections for each. Sure, you'll be wrong in many cases but often times your errors will cancel each other ...