Search found 1355 matches

by Electron
Sun Aug 02, 2015 4:59 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Fund Dividends - More Significant Digits Than Shown?
Replies: 5
Views: 551

Vanguard Fund Dividends - More Significant Digits Than Shown?

The most recent dividend shown in the fund profile for Vanguard Prime Money Market fund is $0.00003. That amount is up from $0.00002 and $0.00001 earlier in the year. https://personal.vanguard.com/us/funds/snapshot?FundId=0030&FundIntExt=INT#tab=4 These dividend amounts have not quite matched wh...
by Electron
Thu Jul 30, 2015 5:03 pm
Forum: Investing - Theory, News & General
Topic: The Long-Term Decline of Interest Rates
Replies: 36
Views: 3116

Re: The Long-Term Decline of Interest Rates

That is sobering news for those who are waiting for higher returns from Money Market funds and CDs. It could take a long time for rates to move significantly higher and might require persistent inflation. Today it's hard to imagine an economy that could withstand the high rates seen in 1980-81 when ...
by Electron
Thu Jul 30, 2015 4:08 pm
Forum: Investing - Theory, News & General
Topic: Rebalancing Manages Risk - How is Return Affected?
Replies: 2
Views: 193

Rebalancing Manages Risk - How is Return Affected?

Vanguard has an excellent document available discussing the potential benefits of their new Personal Advisor Services. http://www.vanguard.com/advisorvalue There is a detailed discussion on rebalancing. They have attempted to assign a value-added figure for rebalancing and are suggesting 35 basis po...
by Electron
Tue Jul 28, 2015 11:00 pm
Forum: Investing - Theory, News & General
Topic: Apple individual stock, what am I missing here?
Replies: 55
Views: 4139

Re: Apple individual stock, what am I missing here?

Did the market just irrationally offer investors an 8% discount on Apple? . . . So the key question is "What does the market think is wrong with Apple relative to the rest of the stock market?" Short term moves in individual stocks and the overall market may not make a lot of sense. Prior...
by Electron
Sun Jul 26, 2015 4:51 pm
Forum: Investing - Theory, News & General
Topic: How Does Vanguard Calculate YTD Performance for Bond Funds?
Replies: 6
Views: 506

Re: How Does Vanguard Calculate YTD Performance for Bond Funds?

"Average Annual Returns", "Growth Charts", "Total Return", "YTM" and many more "calculations" are all different forms of an Internal Rate of Return (IRR) analysis. It is the single discount rate that makes the net present (or future) value of the di...
by Electron
Sun Jul 26, 2015 4:32 pm
Forum: Investing - Theory, News & General
Topic: How Does Vanguard Calculate YTD Performance for Bond Funds?
Replies: 6
Views: 506

Re: How Does Vanguard Calculate YTD Performance for Bond Funds?

The Security and Exchange Commission (SEC) provides rules and regulations governing how mutual funds report their performance numbers. The details are spelled out in Item 26 (pages 32-36) from the SEC instructions. Thanks for the pointer. The document seems to cover 1, 5, and 10 year performance bu...
by Electron
Sun Jul 26, 2015 4:12 pm
Forum: Investing - Help with Personal Investments
Topic: Harvest Savings Bonds or Proceed to Tax-deferred
Replies: 4
Views: 349

Re: Harvest Savings Bonds or Proceed to Tax-deferred

If you are in a relatively low tax bracket today and it will increase later as a result of Social Security income and RMDs from IRAs, you may want to consider incremental Roth Conversions over the next several years.
by Electron
Sun Jul 26, 2015 3:14 pm
Forum: Investing - Theory, News & General
Topic: How Does Vanguard Calculate YTD Performance for Bond Funds?
Replies: 6
Views: 506

Re: How Does Vanguard Calculate YTD Performance for Bond Funds?

Download historical prices from Yahoo Finance and look at "Adjusted Close". That will show you how they calculate reinvested dividends, and should help you to resolve the differences. I think anyone holding a Vanguard bond fund and reinvesting will see the same thing that I described. One...
by Electron
Sun Jul 26, 2015 1:31 pm
Forum: Investing - Help with Personal Investments
Topic: Harvest Savings Bonds or Proceed to Tax-deferred
Replies: 4
Views: 349

Re: Harvest Savings Bonds or Proceed to Tax-deferred

I would start by looking at the tax impact of the various alternatives. Some individuals benefit by starting IRA withdrawals early to reduce future RMDs. It might be a help to identify your marginal tax bracket for the different cases. I would also estimate my marginal tax bracket including both Soc...
by Electron
Sun Jul 26, 2015 12:37 pm
Forum: Investing - Theory, News & General
Topic: How Does Vanguard Calculate YTD Performance for Bond Funds?
Replies: 6
Views: 506

How Does Vanguard Calculate YTD Performance for Bond Funds?

I always thought year-to-date performance was the actual percentage gain, but the YTD performance numbers from both Vanguard and Morningstar appear to be something different. Morningstar figures differ slightly from Vanguard possibly because they round dividends. Is it possible they are both includi...
by Electron
Sat Jul 25, 2015 6:34 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard's Automatic RMD Service - Four Options
Replies: 15
Views: 1352

Re: Vanguard's Automatic RMD Service - Four Options

Did you try to leave the % blank for the fund from which you want to take no distribution, but make sure that the other percentages total 100%? I know this seems silly, but it sounds like the programmer put a data validation check that any entry must be > 0 and <=100% under the assumption that if y...
by Electron
Sat Jul 25, 2015 5:23 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard's Automatic RMD Service - Four Options
Replies: 15
Views: 1352

Re: Vanguard's Automatic RMD Service - Four Options

Also you can change the allocation as many times as you want during the year. I use the proportional allocation. Just go on line and edit the distribution basis. I believe any changes would result in the mailing of a new RMD service agreement with the updated dollar amounts for each fund. If you we...
by Electron
Sat Jul 25, 2015 5:04 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard's Automatic RMD Service - Four Options
Replies: 15
Views: 1352

Re: Vanguard's Automatic RMD Service - Four Options

tomd37 - My statements were regarding the Automatic RMD service once it is set up. You are correct on the general rules for RMDs from multiple IRAs. bertilak - Here is the relevant statement in my RMD Service Agreement mailed in January. "Any distribution you take prior to enrolling in the Serv...
by Electron
Sat Jul 25, 2015 4:38 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard's Automatic RMD Service - Four Options
Replies: 15
Views: 1352

Re: Vanguard's Automatic RMD Service - Four Options

My understanding is that the amount of THIS year's RMD is entirely based on LAST year's ending balance and does not change for the year. ANY money taken out of the IRA through the year is a distribution and counts towards the required minimum for the year. I was under the impression that Vanguard t...
by Electron
Sat Jul 25, 2015 3:49 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard's Automatic RMD Service - Four Options
Replies: 15
Views: 1352

Re: Vanguard's Automatic RMD Service - Four Options

Thanks all for your replies. The only real issue is that you can't specify $0.00 or 0% in the first two choices. If you wanted your RMD to come out of three funds as 0%, 20%, and 80%, you cannot do it as far as I can tell. A second manual step would be required. However, the system does allow 1%, 19...
by Electron
Sat Jul 25, 2015 1:03 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard's Automatic RMD Service - Four Options
Replies: 15
Views: 1352

Vanguard's Automatic RMD Service - Four Options

Has anyone else noticed limitations in Vanguard's Automatic RMD Service? The service offers four choices on how to specify the withdrawal from multiple funds within an IRA Account. 1. Specify dollar amount for each fund 2. Specify percentage for each fund 3. Equal percentage 4. Proportional They sho...
by Electron
Sun Jul 19, 2015 11:19 pm
Forum: Investing - Theory, News & General
Topic: Tax Efficient Allocation
Replies: 5
Views: 621

Re: Tax Efficient Allocation

Index funds such as the Total Stock Market Index fund are quite tax efficient for taxable accounts. Portfolio turnover is very low and capital gains are generally deferred for a long time. The only annual tax obligation should be the qualified dividends that are distributed quarterly. The current yi...
by Electron
Fri Jul 17, 2015 12:35 pm
Forum: Investing - Theory, News & General
Topic: Jack Bogle in this Month's Money Magazine
Replies: 79
Views: 8114

Re: Jack Bogle in this Month's Money Magazine

I thought the most interesting part of the article was the response to the question about International diversification and correlation with other markets. He acknowledged diversification but rejected the correlation argument stating that higher mathematics are not needed and correlation is being ov...
by Electron
Thu Jul 16, 2015 2:58 pm
Forum: Personal Finance (Not Investing)
Topic: Best Roth IRA Conversion calculator
Replies: 9
Views: 771

Re: Best Roth IRA Conersion calculator

In general, a Roth conversion makes sense if you can convert at a lower tax rate than your tax rate in retirement. It helps to consider the after-tax value of your current IRA. Note that the after-tax value of your IRA would be equivalent to the value of the Roth IRA right after conversion. Thinking...
by Electron
Sat Jul 04, 2015 11:16 pm
Forum: Investing - Theory, News & General
Topic: Bond Funds - Recent Performance Across the Yield Curve
Replies: 8
Views: 822

Re: Bond Funds - Recent Performance Across the Yield Curve

Thanks all for the replies and the reminder to compare bond funds of the same type. I also appreciate the information from Kessler & Company which seems to suggest that a deflationary scenario could still unfold. Back to my original post, one interesting thing is the magnitude of the drop in lon...
by Electron
Sat Jul 04, 2015 12:37 pm
Forum: Investing - Theory, News & General
Topic: Bond Funds - Recent Performance Across the Yield Curve
Replies: 8
Views: 822

Bond Funds - Recent Performance Across the Yield Curve

Bond Funds of all maturities have declined quite a bit in price since late January. Have bonds started to discount future Federal Reserve rate hikes and other factors as well? Morningstar is showing the following bond fund performance year-to-date: Vanguard Short Term Investment Grade: 0.99% Vanguar...
by Electron
Thu Jun 25, 2015 2:19 pm
Forum: Investing - Help with Personal Investments
Topic: Selling Fund Before Dividend Distribution & Buying it Right Back to Avoid Withholding Tax
Replies: 16
Views: 2496

Re: Selling Fund Before Dividend Distribution & Buying it Right Back to Avoid Withholding Tax

Does the price of the fund jump down $1.845 after the dividend distribution and will I on average gain those $1.845 fully when buying for the lower price on the next day after distribution? If the market representing your index fund was unchanged between the record day and the ex-dividend day, your...
by Electron
Wed Jun 17, 2015 3:00 pm
Forum: Investing - Theory, News & General
Topic: Fizzy swans: decompression sickness as an analogy for investing risk?
Replies: 15
Views: 1964

Re: Fizzy swans: decompression sickness as an analogy for investing risk?

This thread prompted me to find a plastic underwater dive table that I used back in the mid 1970s. The card has the NU-WAY Repetitive Dive Tables on one side and the 1970 U.S. Navy Standard Air Decompression Tables on the other side. This table was small enough to fit in the pocket of a buoyancy com...
by Electron
Wed Jun 17, 2015 1:12 pm
Forum: Investing - Help with Personal Investments
Topic: tIRA's RMDs causing increasing tax concerns
Replies: 62
Views: 7622

Re: tIRA's RMDs causing increasing tax concerns

It's just he offered one of the first ideas I might have a chance of understanding and calculating. TaxAct 2014 has all the capabilities to model a Roth Conversion for this case. It should be fairly easy to download the program, enter the data from your 2014 return, and verify the Federal tax. Ordi...
by Electron
Tue Jun 16, 2015 1:12 pm
Forum: Investing - Help with Personal Investments
Topic: tIRA's RMDs causing increasing tax concerns
Replies: 62
Views: 7622

Re: tIRA's RMDs causing increasing tax concerns

I probably missed it, but remember these returns have to be real since the tax brackets go up each year with inflation. However, the SS brackets don't change, which is a complication. The table I provided was only to point out that RMDs in dollars can increase quite a bit over time. A lot of people...
by Electron
Mon Jun 15, 2015 2:02 pm
Forum: Investing - Help with Personal Investments
Topic: tIRA's RMDs causing increasing tax concerns
Replies: 62
Views: 7622

Re: tIRA's RMDs causing increasing tax concerns

House Blend - thanks for the input. It appears that a Roth Conversion would not be advisable in this case if the marginal tax rate to convert is higher than the 25% tax rate expected after age 70.5. The marginal tax rate related to Social Security taxation might be 22.5% or 27.75%. Since we are talk...
by Electron
Sun Jun 14, 2015 3:33 pm
Forum: Investing - Help with Personal Investments
Topic: tIRA's RMDs causing increasing tax concerns
Replies: 62
Views: 7622

Re:

Electron, if you do this and don't include QDIV/LTCG, in filling up the 15% bracket w/ ordinary income from a Roth conversion, don't you effectively do the conversion at 30% (because of the promotion of QDIV/LTCG in to the 25% bracket where it is taxed at 15%. That marginal rate might then be highe...
by Electron
Sun Jun 14, 2015 2:05 pm
Forum: Investing - Help with Personal Investments
Topic: tIRA's RMDs causing increasing tax concerns
Replies: 62
Views: 7622

Re: tIRA's RMDs causing increasing tax concerns

It should be fairly easy to determine if space is available in the 15% bracket. The top of the 15% bracket for a couple in 2014 was $73.8K. If you now add the Standard Deduction and Exemptions you will have a total ranging from $94.1K to $96.5K depending on the age of each spouse. That figure would ...
by Electron
Sat Jun 13, 2015 3:29 pm
Forum: Investing - Help with Personal Investments
Topic: tIRA's RMDs causing increasing tax concerns
Replies: 62
Views: 7622

Re: tIRA's RMDs causing increasing tax concerns

If I do a Roth conversion in the 15% marginal income tax bracket to avoid paying taxes at 25% when RMDs kick in, I figure I'd need a time horizon of at least 8 years before breaking even on that move. ($15 @ 7% / yr. increases to $25 in about 8 years?). That's of course if the portfolio generates a...
by Electron
Fri Jun 12, 2015 5:46 pm
Forum: Investing - Help with Personal Investments
Topic: tIRA's RMDs causing increasing tax concerns
Replies: 62
Views: 7622

Re: tIRA's RMDs causing increasing tax concerns

Here is something that may be of interest to everyone. RMDs in dollars may increase quite a bit after age 70.5 depending on the returns achieved within the IRA. The following data assumes the standard RMD from the IRS Table and a constant return every year in the IRA. The first RMD Divisor is 27.4. ...
by Electron
Fri Jun 12, 2015 2:19 pm
Forum: Investing - Help with Personal Investments
Topic: tIRA's RMDs causing increasing tax concerns
Replies: 62
Views: 7622

Re: tIRA's RMDs causing increasing tax concerns

It's too late for Roth conversions to lower RMDs by any appreciable amount that would avoid the projected tax increase. I might take another look at Roth Conversions. Depending on your current and future tax brackets, it's possible that a few conversions over the next few years could provide a bene...
by Electron
Fri Jun 12, 2015 1:36 pm
Forum: Investing - Theory, News & General
Topic: NYSE Volume - Large Increase in Last 30 Minutes of Trading
Replies: 5
Views: 1034

Re: NYSE Volume - Large Increase in Last 30 Minutes of Trading

If 1/4 to 1/3 of the trades occur in the last 1/13 of the trading day, and mutual funds settle at the end of the day, is this positive or negative for funds vs ETFs? The best choice is likely the Open Ended Mutual fund or ETF with the lowest tracking error. One would want to compare an Open Ended M...
by Electron
Thu Jun 11, 2015 4:37 pm
Forum: Investing - Theory, News & General
Topic: NYSE Volume - Large Increase in Last 30 Minutes of Trading
Replies: 5
Views: 1034

Re: NYSE Volume - Large Increase in Last 30 Minutes of Trading

Day traders (including the algorithmic ones, i.e. high-frequency trading firms) need to close their positions for the day. I've noticed this when looking at the data since way before I started investing, so it's been a while since I questioned why. I'm probably missing other factors. There is a ver...
by Electron
Thu Jun 11, 2015 2:35 pm
Forum: Investing - Theory, News & General
Topic: NYSE Volume - Large Increase in Last 30 Minutes of Trading
Replies: 5
Views: 1034

NYSE Volume - Large Increase in Last 30 Minutes of Trading

The Wall Street Journal provides a breakdown of NYSE volume at 30 minute intervals. See the link below and scroll part way down the page. http://online.wsj.com/mdc/public/page/2_3021-tradingdiary2.html?mod=topnav_2_3000 Are others surprised at the daily pattern? The highest volume by far has been th...
by Electron
Tue Jun 09, 2015 10:44 pm
Forum: Investing - Theory, News & General
Topic: Does break-even duration matter if bond fund payments are not re-invested?
Replies: 32
Views: 3089

Re: Does break-even duration matter if bond fund payments are not re-invested?

If a bond fund is held to its average duration, you should at least break even from the time of investment. But, that is assuming the yield is re-invested automatically, right? It is possible to lose money relative to the initial investment even if reinvesting income. That would require that rates ...
by Electron
Tue Jun 09, 2015 2:23 pm
Forum: Investing - Theory, News & General
Topic: Does break-even duration matter if bond fund payments are not re-invested?
Replies: 32
Views: 3089

Re: Does break-even duration matter if bond fund payments are not re-invested?

The Wiki has a good explanation in the section discussing Duration and Point of Indifference. http://www.bogleheads.org/wiki/Bonds:_Advanced_Topics Here is a chart I created showing the concept in graphical form. The chart shows a bond index fund starting out with a yield of 2%. The yield increases ...
by Electron
Mon Jun 08, 2015 4:23 pm
Forum: Investing - Help with Personal Investments
Topic: after tax 401K?
Replies: 6
Views: 729

Re: after tax 401K?

I would compare the After Tax 401K with a Taxable Account alternative. A lot depends on the nature of the taxable investment along with current and future tax rates. Note that qualified dividends and capital gains are currently taxed at 0%, 15%, or 20%. In addition, high income investors may pay the...
by Electron
Tue Jun 02, 2015 6:27 pm
Forum: Personal Finance (Not Investing)
Topic: Retirement Withdrawal - which equities to sell based on performance
Replies: 8
Views: 985

Re: Retirement Withdrawal - which equities to sell based on performance

Assuming you have more than one equity fund during retirement (because you have not yet completely adopted the 3-Fund Portfolio) how would/do you pick among your equity funds when selling in retirement -- whether it is for spending or for reallocation into a more permanent portfolio? Selling equity...
by Electron
Mon Jun 01, 2015 4:47 pm
Forum: Personal Finance (Not Investing)
Topic: Retirement Withdrawal - which equities to sell based on performance
Replies: 8
Views: 985

Re: Retirement Withdrawal - which equities to sell based on performance

If carryover losses weren't in the picture, then it seems even more important to sell strategically to minimize taxable gain while realizing the annual spending funds. If shares were purchased at different times, you might be able to minimize taxable gains with the choice of cost basis method (Aver...
by Electron
Mon Jun 01, 2015 1:10 pm
Forum: Investing - Help with Personal Investments
Topic: RMUCX [Oppenheimer Rochester Fund Municipals C]
Replies: 16
Views: 876

Re: RMUCX [Oppenheimer Rochester Fund Municipals C]

I have to do some math though to find out why even with reinvestments its overall value is down since 2007. You should actually be at a profit relative to your initial investment. Check your first purchase which might be in the area of $2K. The total gain since 2007 assuming reinvestment of all div...
by Electron
Sun May 31, 2015 4:25 pm
Forum: Investing - Help with Personal Investments
Topic: RMUCX [Oppenheimer Rochester Fund Municipals C]
Replies: 16
Views: 876

Re: RMUCX [Oppenheimer Rochester Fund Municipals C]

There may be a simple answer to this question. The $3001.48 displayed in the account is the current cost basis including original purchase plus all reinvested distributions. If that is the case, the original investment would have been quite a bit less. That could fit in two different ways. You would...
by Electron
Sat May 30, 2015 1:46 pm
Forum: Investing - Help with Personal Investments
Topic: RMUCX [Oppenheimer Rochester Fund Municipals C]
Replies: 16
Views: 876

Re: RMUCX

The Morningstar chart does appear correct and matches the Performance chart available on Stockcharts.com. The Performance charts are also adjusted for distributions. NAV is also consistent on four different sites that I checked. NAV is down less than 20% since the peak in 2007. I would check the ini...
by Electron
Fri May 29, 2015 2:42 pm
Forum: Investing - Help with Personal Investments
Topic: RMUCX [Oppenheimer Rochester Fund Municipals C]
Replies: 16
Views: 876

Re: RMUCX

I reinvested all income distributions from 2007 through today, the current amount is still -23% of what I paid. It's possible that the Morningstar chart is based on incorrect data. I assume that you are multiplying your current reinvested share balance by the current NAV and have not made any withd...
by Electron
Fri May 29, 2015 1:29 pm
Forum: Investing - Help with Personal Investments
Topic: RMUCX [Oppenheimer Rochester Fund Municipals C]
Replies: 16
Views: 876

Re: RMUCX

The Morningstar chart is showing the growth of $10K which assumes reinvestment of all income distributions.

You need to think in terms of total return rather than just the NAV of the fund.
by Electron
Thu May 28, 2015 1:07 pm
Forum: Investing - Help with Personal Investments
Topic: Explaining Vanguard GNMA Admiral over past month
Replies: 11
Views: 1185

Re: Explaining Vanguard GNMA Admiral over past month

Here is some information on Mortgage Dollar Roll Activity. It is also explained in the latest Vanguard U.S. Government Bond Funds Annual Report on page 81. http://en.wikipedia.org/wiki/Dollar_roll One thought is that Vanguard GNMA is managed for both income and total return. It looks as though Mortg...
by Electron
Wed May 27, 2015 10:52 pm
Forum: Investing - Theory, News & General
Topic: Wellington & Wellesley
Replies: 60
Views: 9125

Re: Wellington & Wellesley

Wellington and Wellesley would be more appropriate for tax sheltered accounts in most cases. Mutual funds with higher tax efficiency might be a better choice in taxable accounts depending on the investor's tax bracket. Both funds have excellent records which suggests skill in the active management d...
by Electron
Tue May 26, 2015 5:59 pm
Forum: Investing - Help with Personal Investments
Topic: Explaining Vanguard GNMA Admiral over past month
Replies: 11
Views: 1185

Re: Explaining Vanguard GNMA Admiral over past month

SEC Yield often varies more than you would expect as discussed below. I tend to look at the monthly dividend payout in dollars per share adjusted for any capital gains and also the distribution yield. The monthly dividend also varies based on the number of days in the month. Active management in the...
by Electron
Mon May 25, 2015 2:32 pm
Forum: Investing - Help with Personal Investments
Topic: Tax efficient way to unwind a dividend growth portfolio?
Replies: 5
Views: 817

Re: Tax efficient way to unwind a dividend growth portfolio?

Treating the dividend paying stock portfolio as an index fund does sound like an attractive possibility. It might be worth seeing if all major S&P 500 sectors are represented with a reasonable percentage in each. Here is a site showing the nine basic sectors within the S&P 500. You could als...
by Electron
Mon May 25, 2015 2:05 pm
Forum: Investing - Theory, News & General
Topic: another look at dividend paying stocks and valuations
Replies: 64
Views: 5176

Re: another look at dividend paying stocks and valuations

The Fall 2014 issue of the T. Rowe Price Report had some comments along the same lines as this topic. The manager of the Global Stock Fund wrote "I am 100% sure that we are in a yield-chasing bubble right now — just like with the tech and housing bubbles". See the article on Global Investi...
by Electron
Sun May 24, 2015 1:59 pm
Forum: Investing - Theory, News & General
Topic: Bill Gross Thinks the End Is Near
Replies: 54
Views: 7518

Re: Bill Gross Thinks the End Is Near

The Fall 2014 issue of the T. Rowe Price Report had an interesting article relating to this topic. The manager of the Global Stock fund said he is "100% sure that we are in a yield-chasing bubble right now". That is not surprising considering the extremely low interest rate policy that has...

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