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Re: Left tail portfolio - 70% bonds. Good idea?

Of course you can sell individual bonds. You are not forced to hold them to maturity. What are you trying to say with "You don't get the capital appreciation"? You do. The treasury market is extremely liquid. The hassle amounts to a few mouse clicks every year or so. There are no commissi...
by Day9
Wed Sep 17, 2014 11:14 pm
 
Forum: Investing - Theory, News & General
Topic: Left tail portfolio - 70% bonds. Good idea?
Replies: 22
Views: 1059

Re: Left tail portfolio - 70% bonds. Good idea?

I don't think the hassle of individual bonds is worth it. Plus you don't get the capital appreciation of a bond that you'll get in a financial crisis which will effectively allow you to buy more shares of depressed stocks thru rebalancing. Bond fund gives better liquidity right when liquidity is ki...
by Day9
Wed Sep 17, 2014 10:08 pm
 
Forum: Investing - Theory, News & General
Topic: Left tail portfolio - 70% bonds. Good idea?
Replies: 22
Views: 1059

Re: How often do YOU rebalance and when?

I rebalance with new contributions.


I never trigger a taxable event just to rebalance. I don't think it is ever worth it.
by Day9
Wed Sep 17, 2014 7:35 pm
 
Forum: Investing - Help with Personal Investments
Topic: How often do YOU rebalance and when?
Replies: 36
Views: 1379

Re: Left tail portfolio - 70% bonds. Good idea?

I believe Larry addresses this idea thoroughly in his recent book Reducing the Risk of Black Swans: Using the Science of Investing to Capture Returns With Less Volatility
by Day9
Wed Sep 17, 2014 6:31 pm
 
Forum: Investing - Theory, News & General
Topic: Left tail portfolio - 70% bonds. Good idea?
Replies: 22
Views: 1059

Re: Proposed: 35% Maximum Bond Allocation, For Life

65/35 is not a radical allocation and is fine if the investor can stay the course. It is basically the same as the ubiquitous 60/40 portfolio. However you are suggesting locking in this 65/35 allocation instead of the traditional approach of gliding from say 60/40 to 40/60 as one enters his twilight...
by Day9
Tue Sep 16, 2014 6:50 pm
 
Forum: Investing - Theory, News & General
Topic: Proposed: 35% Maximum Bond Allocation, For Life
Replies: 16
Views: 1682

Re: How much you need to save as multiple of salary

I work for a large company that is often called a leader in retirement packages. They have stopped matching on each paycheck and instead match in one lump sum at the end of the year. If you are no longer employed by that time you do not get the match for that year. You lose out on the time-value of ...
by Day9
Mon Sep 15, 2014 9:40 pm
 
Forum: Investing - Theory, News & General
Topic: How much you need to save as multiple of salary
Replies: 51
Views: 5933

Re: An Interesting Correlation

Why would you pay an expense ratio to hold a treasury fund? There is no diversifying among issuers with treasury funds like there is with corporates. iShares participates in security lending in their treasury funds (including TLT). They claim that this boosts returns but it is not enough to countera...
by Day9
Mon Sep 15, 2014 2:13 am
 
Forum: Investing - Theory, News & General
Topic: An Interesting Correlation
Replies: 22
Views: 1798

Re: Share your Hot-Rod Portfolio

Why max 8 funds? Is this a hot rod contest or a Boy Scouts Pinewood Derby?
by Day9
Fri Sep 12, 2014 10:59 pm
 
Forum: Investing - Theory, News & General
Topic: Share your Hot-Rod Portfolio
Replies: 52
Views: 3462

Re: Are Mid Caps the NEW Small Caps

Check out this post by Mel Lindauer with comments from Larry Swedroe:

http://socialize.morningstar.com/NewSocialize/forums/p/27802/27802.aspx#27802
by Day9
Wed Sep 10, 2014 4:15 pm
 
Forum: Investing - Theory, News & General
Topic: Are Mid Caps the NEW Small Caps
Replies: 15
Views: 1668

Re: Socially Irresponsible Fund

Philip Morris did a great benefit to humanity by definitively proving that an unrelated 3rd factor causes someone to want to smoke, and this unrelated 3rd factor causes someone to get lung cancer, debunking once and for all the myth that smoking causes lung cancer. Truly Philip Morris and Altria Gro...
by Day9
Tue Sep 09, 2014 5:19 am
 
Forum: Investing - Theory, News & General
Topic: Socially Irresponsible Fund
Replies: 16
Views: 1471

Re: Do you consider your emergency fund part of your portfol

No because my emergency fund is either a flat $X thousand dollars or a certain number of months' worth of living expenses. I do not allocate a percentage of my portfolio to "emergency fund". Like a previous poster said, my emergency fund is not touched when I rebalance my portfolio.
by Day9
Mon Sep 08, 2014 9:17 pm
 
Forum: Investing - Theory, News & General
Topic: Do you consider your emergency fund part of your portfolio?
Replies: 50
Views: 3038

Re: Why does the stock market "always go up"? Will this pers

Question for most people here with optimistic answers - the Japanese economy is still running. Large Japanese companies are still selling things all over the world. However, the Nikkei is still more than 50% below its 1990 highs. It is currently at 1986 levels. What is "long term" to you?...
by Day9
Mon Sep 08, 2014 2:44 am
 
Forum: Investing - Theory, News & General
Topic: Why does the stock market "always go up"? Will this persist?
Replies: 42
Views: 3814

Re: How is tilting any different that active value investing

Some Bogleheads only advocate passive investing instrumentally to achieve their goals and values of

1. Low Cost

2. Low Turnover

3. Broad diversification

Some tilters argue that tilting increases a portfolio's Diversification of different risk factors
by Day9
Fri Sep 05, 2014 2:00 pm
 
Forum: Investing - Theory, News & General
Topic: How is tilting any different that active value investing
Replies: 55
Views: 2528

Re: Let me get this straight about SCV & factor diversificat

Almost any small group of stocks will be more diversified in terms of the number of factors because of the way factors are defined. Factors, except for beta, are defined such that the market always has a zero loading, so it's almost a tautology. SCV might out-perform the total market. It might even...
by Day9
Thu Sep 04, 2014 10:19 pm
 
Forum: Investing - Theory, News & General
Topic: Let me get this straight about SCV & factor diversification
Replies: 152
Views: 8169

Re: 100% Stock Thread Collection

Yes margin does more than merely magnify risks. It introduces new risks as well like the risk of margin call. If your creditor sells all your assets to pay back your debts and you go to 0, you cannot participate in any recovery. You are dead, Game Over. It is basically impossible scenario for your p...
by Day9
Wed Sep 03, 2014 1:12 am
 
Forum: Investing - Theory, News & General
Topic: 100% Stock Thread Collection
Replies: 93
Views: 5314

Re: "3 Investments Retirees Don't Really Need"

Good interview! It could just as well be titled, "3 Investments Investors Don't Really Need." :) I agree with you but I would also say that the role of bonds in a retiree's portfolio is quite different than that of a young accumulator's. It is more important for bonds to be denominated in...
by Day9
Tue Sep 02, 2014 11:42 pm
 
Forum: Investing - Theory, News & General
Topic: "3 Investments Retirees Don't Really Need"
Replies: 7
Views: 1720

Re: Why is REIT only sector fund recommended in slice & dice

Keep in mind that about 7 years ago a Boglehead found that funds like Vanguard Small Cap Value (VBR) was 15% REIT so depending on how deep you tilt you may be overexposing yourself to REIT if you devote a percentage of your portfolio to them. However other funds like DFA's small cap value held much ...
by Day9
Tue Sep 02, 2014 11:36 pm
 
Forum: Investing - Theory, News & General
Topic: Why is REIT only sector fund recommended in slice & dice?
Replies: 113
Views: 7324

Re: Is now a good time to buy bonds?

The 10 year treasury is about 2.5%

The 10 year German government bund is about 1.5%

The 10 year Japanese government bond is about 0.5%

Don't tell me "Rates have nowhere to go but up!"
by Day9
Tue Sep 02, 2014 11:02 pm
 
Forum: Investing - Theory, News & General
Topic: Is now a good time to buy bonds?
Replies: 18
Views: 1897

Re: International allocation

33% of my equity is international because I find the 2:1 ratio keeps my portfolio simple and easier to maintain, stay the course, and rebalance.
by Day9
Fri Aug 29, 2014 6:41 pm
 
Forum: Investing - Theory, News & General
Topic: International allocation
Replies: 73
Views: 4244

Do you need REITs if you tilt to SCV? International REITs?

The Collective Thoughts stickied post links to these two threads: real estate investment trusts don’t add much unique risk and REITs in value funds . At the time of that post (about 7 years ago) Vanguard's Small Cap Value fund was about 15% REIT but DFA's SmVal fund was only 0.5% REIT (Thanks Robert...
by Day9
Fri Aug 22, 2014 1:24 am
 
Forum: Investing - Theory, News & General
Topic: Do you need REITs if you tilt to SCV? International REITs?
Replies: 0
Views: 293

Re: an interesting chart [Asset correlation matrix]

past correlations do not guarantee future correlations.
by Day9
Wed Aug 20, 2014 3:32 am
 
Forum: Investing - Theory, News & General
Topic: an interesting chart [Asset correlation matrix]
Replies: 3
Views: 797

An Honest Stock Market Update

[Thread merged, see below. --admin LadyGeek]

[Content in excess of copyright fair use removed by admin LadyGeek]

http://www.fool.com/investing/general/2014/08/12/an-honest-stock-market-update.aspx
by Day9
Mon Aug 18, 2014 5:16 pm
 
Forum: Investing - Theory, News & General
Topic: An Honest Stock Market Update - A good laugh
Replies: 17
Views: 2913

Re: Interesting BRK tidbit

Who cares? It's a meaningless milestone. :confused
by Day9
Thu Aug 14, 2014 6:26 pm
 
Forum: Investing - Theory, News & General
Topic: Interesting BRK tidbit
Replies: 16
Views: 1950

Re: Beat The Street's Permanent Portfolio

Beat The Street wrote:
placeholder wrote:
Beat The Street wrote:Because you can keep this allocation permanently.

You can keep any allocation permanently.


You're like a broken needle, you're missing the point.


Could you spell it out for us please?
by Day9
Wed Aug 13, 2014 8:40 pm
 
Forum: Investing - Theory, News & General
Topic: Beat The Street's Permanent Portfolio
Replies: 36
Views: 3122

Re: Can a single investor influence the market?

Some famous investor tweets "AAPL announcing something big during the next earnings report". This has moved the stock price in the past.
by Day9
Wed Aug 13, 2014 6:23 pm
 
Forum: Investing - Theory, News & General
Topic: Can a single investor influence the market?
Replies: 20
Views: 1731

Re: WSJ: Who are your investment role models?

You guys, the Bogleheads, are my investment role models :sharebeer
by Day9
Tue Aug 12, 2014 7:49 pm
 
Forum: Investing - Theory, News & General
Topic: WSJ: Who are your investment role models?
Replies: 6
Views: 668

Re: The Boglehead-prisoner’s dilemma.

If you ban us from choosing paper bonds or stock certificates, and we can't trust anybody, we don't have much else of a choice do we?

A mix of American Gold Eagles, Platinum Canadian Maple Leafs, Palladium Canadian Maple Leafs, and some $100 bills.

What else is there even?
by Day9
Thu Jul 31, 2014 1:42 am
 
Forum: Investing - Theory, News & General
Topic: The Boglehead-prisoner’s dilemma.
Replies: 33
Views: 5461

Re: Stocks: losing money for 20-30 years not uncommon

It's almost as if investing involves risk, including the risk of loss of principal. :oops:
by Day9
Tue Jul 29, 2014 7:42 pm
 
Forum: Investing - Theory, News & General
Topic: Stocks: losing money for 20-30 years not uncommon
Replies: 43
Views: 4315

Saudi to Open Up $531 Billion Stock Market to Foreigners

http://www.businessweek.com/news/2014-07-21/saudi-to-open-up-531-billion-stock-market-to-foreigners Saudi Arabia will open up its stock market to international investors in the first half of 2015, giving foreigners access to the Arab world’s biggest stock market for the first time. The move is a “g...
by Day9
Tue Jul 22, 2014 4:59 am
 
Forum: Investing - Theory, News & General
Topic: Saudi to Open Up $531 Billion Stock Market to Foreigners
Replies: 1
Views: 659

Re: [Poll] Are you more risk averse than average?

I'm in my 20's so I am more risk tolerant than the average investor. But my impression of investors my age is that they are usually 100% stock, sometimes in only a handful of individual stocks. I am much more risk averse than that person.
by Day9
Sun Jul 13, 2014 11:56 pm
 
Forum: Investing - Theory, News & General
Topic: [Poll] Are you more risk averse than average?
Replies: 36
Views: 2775

Re: Financial Advice for People Who Aren’t Rich

Daave, I thought you needed at least one reply. You may have set a record with almost OVER 700 views and no replies. Thanks for the list, I think it's useful--and post worthy :happy Paul Maybe it's because he almost just pasted a link and offered no summary and no analysis. Does this forum have a r...
by Day9
Sat Jul 12, 2014 6:39 pm
 
Forum: Investing - Theory, News & General
Topic: Financial Advice for People Who Aren’t Rich
Replies: 9
Views: 3067

Re: WSJ article on overvalue and lower returns

Counter argument: They aren't overvalued. This is the "new normal". Obama in 2009: "We now know a financial crisis on one country can affect the whole world... Our prosperity must be shared" [among the global wealthy elite] In this new world of globalization, the foreign rich are...
by Day9
Sat Jul 12, 2014 6:37 pm
 
Forum: Investing - Theory, News & General
Topic: WSJ article on overvalue and lower returns
Replies: 6
Views: 1439

Re: If you wouldn't buy (stocks), then you must sell

I own $X in stocks. You are asking me if I had $X in cash instead would I buy stocks?

My answer: I would follow my Investment Policy Statement and invest in the asset allocation it describes.
by Day9
Wed Jul 02, 2014 6:38 pm
 
Forum: Investing - Theory, News & General
Topic: If you wouldn't buy (stocks), then you must sell
Replies: 32
Views: 3112

Re: Worth it to eliminate counterparty risk with Treasuries?

P.S: I hold mine in a fund (VFIUX) and don't think twice about it. The expense ratio is 0.1% and the SEC yield 1.64%. 0.1%/1.74% means you are giving up 5%-6% of the returns. And all Bogleheads know that costs compound and over a long term the fees could eat up a large portion of your returns. In w...
by Day9
Fri Jun 27, 2014 6:07 pm
 
Forum: Investing - Theory, News & General
Topic: Worth it to eliminate counterparty risk with Treasuries?
Replies: 17
Views: 1073

Worth it to eliminate counterparty risk with Treasuries?

Hi Bogleheads, What is the best way to own Treasuries in your portfolio? With Treasuries, there is no need to diversify among issuers which is one of the primary reasons for using a bond fund. Given this, it seems pointless to pay an expense ratio for a fund like Vanguard's Intermediate Treasury VFI...
by Day9
Fri Jun 27, 2014 4:24 pm
 
Forum: Investing - Theory, News & General
Topic: Worth it to eliminate counterparty risk with Treasuries?
Replies: 17
Views: 1073

Re: Is it impossible to buy individual foreign treasuries?

I have never investigated buying foreign government debt. But why would you want unhedged positions? Vanguard claims there is no payoff, and lots of risk. I have not been interested enough to read up on it beyond that, but the V argument seemed to make sense. If I am buying them directly then they ...
by Day9
Fri Jun 20, 2014 10:11 pm
 
Forum: Investing - Theory, News & General
Topic: Is it impossible to buy individual foreign treasuries?
Replies: 9
Views: 508

Re: The importance of starting to invest early

Good for you, Day9. Keep it up and you'll be financially independent long before your contemporaries who are just living for today. Thank you Mel I am a big fan. It was not a big sacrifice for me to save this much though. My coworkers are much older than me and my peers were not so lucky as me and ...
by Day9
Fri Jun 20, 2014 8:48 pm
 
Forum: Investing - Theory, News & General
Topic: The importance of starting to invest early
Replies: 9
Views: 1757

Re: Best Fixed Income Investment - Morningstar article

The best fixed income investment depends on its role in your portfolio. For millenials with 90% stock, 10% bond portfolios, 5-year CDs are not the best investment for them. The role of bonds for this 90/10 young accumulator is not to dilute the magnitude of a stock crash but to add meaningful divers...
by Day9
Fri Jun 20, 2014 8:39 pm
 
Forum: Investing - Theory, News & General
Topic: [Morningstar article] the best fixed income investment
Replies: 55
Views: 3986

Re: The importance of starting to invest early

I discovered Bogleheads two years ago when I was 24 with nothing in retirement accounts. Since then I have been maxing Roth IRA and 401k saving at least $22k per year :beer
by Day9
Fri Jun 20, 2014 8:34 pm
 
Forum: Investing - Theory, News & General
Topic: The importance of starting to invest early
Replies: 9
Views: 1757

Is it impossible to buy individual foreign treasuries?

Hi Bogleheads, Recently (many months ago but recent compared to the lifetime of this community) Vanguard has cosigned the idea of diversifying your bond position globally by adding International Bond Fund to their target date and life strategies funds-of-funds. This has been met with diverse opposit...
by Day9
Fri Jun 20, 2014 8:22 pm
 
Forum: Investing - Theory, News & General
Topic: Is it impossible to buy individual foreign treasuries?
Replies: 9
Views: 508

Re: >$1MM saved -- thank you BogleHeads!

This is an occasion worthy of not only praise but also CELEBRATION!

Take your wife/family out for a nice dinner or whatever they like to do to celebrate. Congratulations! I admire you for staying disciplined for the past 16 years and beyond. I want to become like you one day (currently mid 20s)
by Day9
Sun Jun 15, 2014 11:40 pm
 
Forum: Personal Finance (Not Investing)
Topic: >$1MM saved -- thank you BogleHeads!
Replies: 21
Views: 3441

Re: Which Vanguard Short Treasury Fund

Why not buy your treasuries directly? The expense ratio is small but so is the yield and fees are eating up a significant % of your returns. READ THE PROSPECTUS. I wanted long term treasuries so I checked out VGLT. It contains lots of agency bonds that I do not want like Israeli War Bonds. Know what...
by Day9
Wed Jun 11, 2014 2:44 pm
 
Forum: Investing - Theory, News & General
Topic: Which Vanguard Short Treasury Fund
Replies: 38
Views: 2998

Re: Swenson question

Swenson suggests a healthy allocation to TIPS to serve the role of protecting against inflation. As others have pointed out, TIPS achieve this much better than gold for retirement portfolios. Swenson does not recommend any commodities to individuals. The closest thing he recommends to individuals is...
by Day9
Mon Jun 02, 2014 4:17 pm
 
Forum: Investing - Theory, News & General
Topic: Swenson question
Replies: 10
Views: 1082

Re: Bonds - Throw it all on the table!!!

I own VUSUX Vanguard Long Term Government Admiral TLT iShares 20+ year Treasury Bond ETF I draw inspiration from the PP crowd and ideally I would own newly issued Long Treasury Bonds directly, perhaps even on treasurydirect.gov with no counterparty risk. I would then sell them every 10 years (or wha...
by Day9
Sat May 31, 2014 6:03 pm
 
Forum: Investing - Theory, News & General
Topic: Bonds - Throw it all on the table!!!
Replies: 135
Views: 15129

Why have Treasury Bonds been such good diversifiers lately?

http://i.imgur.com/JVtzVl4.png This is a 10 year chart that compares 20+ year Treasury Bonds, Total Stock, and Total Bond. Why have Treasury Bonds been such good diversifiers to US Stocks lately? They seem to consistently zig when Total Stock zagged over this 10 year period. Total Bond on the other...
by Day9
Sat May 31, 2014 3:05 am
 
Forum: Investing - Theory, News & General
Topic: Why have Treasury Bonds been such good diversifiers lately?
Replies: 8
Views: 1043

Re: Are longer duration TIPS more sensitive to inflation?

They would likely be more sensitive to unexpected changes in the inflation rate as that could cause the inflation risk premium in their price to rise or fall. I would also add that rising inflation could increase demand for TIPS in general, pushing real yields down (falling inflation could do the r...
by Day9
Tue May 20, 2014 6:34 pm
 
Forum: Investing - Theory, News & General
Topic: Are longer duration TIPS more sensitive to inflation?
Replies: 10
Views: 537

Are longer duration TIPS more sensitive to inflation?

I know longer duration TIPS are more sensitive to interest rate changes, just like other long duration bonds. But are longer duration TIPS more sensitive to inflation than shorter duration ones? Whenever I try to google search TIPS I just find "Investing tips" :oops:

Cheers :beer
by Day9
Tue May 20, 2014 6:08 pm
 
Forum: Investing - Theory, News & General
Topic: Are longer duration TIPS more sensitive to inflation?
Replies: 10
Views: 537

Re: investor sentiment and its role in asset pricing

On the Boglehead Wiki, we provide many sources that claim that Small cap has higher expected return than Large Cap.

http://www.bogleheads.org/wiki/Historical_and_expected_returns
by Day9
Sat May 17, 2014 4:56 pm
 
Forum: Investing - Theory, News & General
Topic: investor sentiment and its role in asset pricing
Replies: 5
Views: 489

Re: Why 25/25/25/25 in a Permanent Portfolio?

Security and insurance are not trivial costs for storing 100s of thousands to millions of dollars of cash and gold in your house. I don't think the counterparty risk of especially a physical gold ETF is worth worrying about, and they can genuinely add value by pooling security efforts, but even the...
by Day9
Wed May 14, 2014 4:17 pm
 
Forum: Investing - Theory, News & General
Topic: Why 25/25/25/25 in a Permanent Portfolio?
Replies: 31
Views: 2973
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