Bogleheads.org

If spend freely means spending without thought or limits there are no categories. All spending comes with some thought as to if we can afford it and would we rather spend it on something else. Are we relatively more free in some areas than others? Sure. Food and travel come to mind. Very early on ou...

It always kind of creeps me out when people talk about needing permission to do something in a marriage... Seems like there is either mutual agreement on something...or not. That's it. Permission just sounds like a power or control issue. Back to your on topic programming, BFG Big purchases should ...

The market can stay irrational longer than you can stay solvent. (or more to the point here, it can stay irrational longer than many a market timing can hold on to a down position). I'm just sticking with a fixed allocation until my circumstances change enough for my desired allocation to change (ne...

I think if we could just agree that this model is good only to make simple back of the envelop estimates we'd find common ground more easy to come by. It is not so that the model is "wrong", so much as an estimate derived from the model being based on back of the envelop assumptions is not...

Triggered by having a teenager about to start driving. It was her age, not mine that was the issue.

dm200 wrote:

HongKonger wrote:A pint of water weighs a pound and a quarter.

In the US, a pint weighs about a pound. In the UK (using the previous non-metric), a pint is about a pound and a quarter.

In what system is 16 oz not 16 oz? Who would make such a system?

.... The long run track of securities prices looks fractal .... What does not look fractal? With enough terms, I can use a Fourier transform to model anything. Anything. Enough terms. Except the Heaviside step function (see Gibbs phenomenon). Depends on what definition of convergence you use. :) Po...

You may buy the car.

Or you may buy a Rolex.

You may not buy both.

I like the idea of letting your wife in on your dirty little secret. If she buys you one that is great. If not, go ahead. I once wanted a particular woodworking tool I did not need and while a whole lot cheaper than a Rolex (but a lot!) at the time we were really far from a 7 figure portfolio (still...

Following this logic, then the only sensible thing would be to have 100% or your equity allocation invested in a true world index fund. Anything else would be half measures. I'm not saying 100% in a true world index fund is wrong, only pointing this out to show the logical conclusion. Thus Jack Bog...

I think most would have fallen out of first getting better educated. But things are coming along (less than 10 years to retirement) so no major mistakes. But the number one thing I would do differently is set up an automatic system of increasing savings rate from the beginning. Say, take 1/3 of ever...

From the Wiki : http://www.bogleheads.org/w/images/1/11/US-International.png This graph is a great illustration of the fact that if you look at things that are nearly identical under a microscope they look very different. This is also an illustration that basically comes right out of a wonderful li...

A target retirement fund maybe best so he does not see the various subfunds moving around, just the bottom line which in a bond heavy balanced fund should be fairly stable.

Good! Hard to tell sometimes on the internet.

Isn't rebalancing "market timing?" Everyone has their own definition, but 'market timing' is generally accepted to be an action based upon one's prediction of the future movement of markets. Rebalancing, in most cases, does not qualify - it's a mathematically predetermined action that doe...

As to why wouldn't rebalance on valuations, you certainly could. But again the amounts being moved are generally so small that it just does not matter. It doesn't have to be small. My stock exposure ranged from < 10% in 2000 (PE10 45) to almost 70% in 2009 (PE10 as low as 12). Now 59% at pE10 24. Y...

Define staying the course. I have made some adjustments over the years. In the beginning I had no clue and a 401K with almost no choices, all low cost "index" type investments so hard to go wrong. I knew stocks were expected to be higher return than bonds with higher risk. Being young I th...

Isn't rebalancing "market timing?" Everyone has their own definition, but 'market timing' is generally accepted to be an action based upon one's prediction of the future movement of markets. Rebalancing, in most cases, does not qualify - it's a mathematically predetermined action that doe...

.... The long run track of securities prices looks fractal .... What does not look fractal? With enough terms, I can use a Fourier transform to model anything. Anything. Enough terms. Lots of things are not fractal. The key characteristic of a fractal is not that it is unpredictable, but that it is...

Andrew Smithers is pretty hot on q, and as I recall his books (Valuing Wall Street and the other one) seemed to have a lot of predictive power. He also shows how it maps onto Shillers PE10. However you are right neither will call turning points-- things like 2000 just seem to happen. So it has lots...

Also you have to make an assumption about dividend growth Well, to be more precise, if you insist on building a model, regardless of the quality of its predictions, you have to make assumptions. As lazyday says, this is the problem with all these models. One is forced to not only make assumptions, ...

A pint is a pound the world around.

Thanks for all the replies! :) First off, I should note that running is only supplemental to my exercise routine. I've been working with primarily bodyweight circuits of different types and really enjoying those. In addition to these I also walk (power walk) 5-6 days a week and try to go for a ligh...

As I have a PhD in math and have a successful multi-decade career, so you are correct that I have a basic working knowledge of what a first derivative is. :) However that completely misses the point it seems to me. If the dividend yield doubled, back to historic levels of 6% say, then the price woul...

Ged wrote:Note: These answers apply to the surface of the Earth only. Otherwise YMMV.

Yes, and you may have to include relativistic effects as well

(or not...)

I am fixing the first 2 factors for analysis, with a view to explaining the impact of the last factor,

The problem is that you have simply assumed away other real-world answers as to why yield can change. In the real world those factors are rarely fixed. Which was my point.

Here appraisals are supposed to be full value with error bars no more than +/-10%. I doubt anyone can assess/appraise your house to better than +/- 10% because in part it depends on who you can entice to buy your home. It is not like going to a store and reading off the price. Sell this month get on...

It is also worth noting that not only can ability to survive risk be low when young but it also can go up with age. It might be harder to get back money lost if you are older, but if you have enough because you have been successful you might be able to do just fine even if you lose a bunch. I think ...

Here is something I did a few years ago. Historically it really has not mattered in the end. See graph number 3. http://home.comcast.net/~rodec/finance/papers/AgeInBonds.pdf Now it might psychologically matter. If an investment goes from $1000 to $10,000 in a fairly steady progress you feel great. I...

I'm planning for the instance where my kid has a legitimate interest in a particular subject (I didn't have such interest as a teenager) and there is an institution recognized as a leader in that discipline Could happen, but really at the undergrad level it is very rare that going in a kid is so sp...

Good luck getting over 3 years out of a battery, seems the general consensus is they are not made like they use to be. You can go to a local chain automotive parts store and they can check your battery and alternator. I don't ever pretend to be an automotive expert, but am very impressed by the kno...

I just put two kids through college... University of Kansas... about $15k a year including room and board... $60k total for each of their degrees... And that's with sorority fees... Could be done for less. There should be a simple college admission test. "Are you willing to pay $200k for your ...

basically thrown your hands up and concluded "I give up, we don't know anything, just put 50% in stocks and 50% bonds." But I think you overstate the amount of uncertainty. It's not a complete opaque box about which nothing is known. I'm sorry you feel this way. It is not uncommon. Some p...

If the dividend yield doubled, back to historic levels of 6% say, then the price would drop to 50. Doesn't this suppose re does not get more profitable? If yield is down because rents are down (either per square foot when down or vacancy went up), and rents go back up, you could get a doubling of y...

I understand that, I should have mentioned my fund is Wellesley, which just maintains 36% stock in most cases. So, since I rebalance my portfolio as you suggest and a balanced fund does the same for you, for better or for worse, it is all the same thing (more or less). In a specific balanced fund t...

I confess that seems a little like the tail wagging the dog to me. Any estimates of stock returns and risk going forward are so likely to be hugely wrong for one thing that this approach seems more wishful thinking than actual sound planning. One thing you are missing is that, while there is great ...

One should focus on what is under your control. Set some more or less reasonable asset allocation between stocks and bonds (split those up if you wish into subasset classes) based on a broad long term view of the market, if long term prospects look poor save more than otherwise or lower expectation...

Jeff,

Appreciate your insights.

Good luck getting over 3 years out of a battery, seems the general consensus is they are not made like they use to be. You can go to a local chain automotive parts store and they can check your battery and alternator. I don't ever pretend to be an automotive expert, but am very impressed by the kno...

I try to use use economics to rule theories in ... and data to rule things out.

The graph is entirely misleading. The differences on the x-axis are totally meaningless. The range is all of 0.4%! Way below the level of noise. For all intents and purposes the SD of these portfolios is identical, they are all equal. The range on the y-axis is even more meaningless; it looks to be...

1) Still waiting for us to hear your brilliant insights explaining why the work on profitability is rubbish. The economic explanations which will also provide us the insights into why such investors as Graham and Dodd and others like Buffett also preached rubbish--because this is basically the stra...

I also don't ignore the risk of a 100% equity portfolio, and if you read and understood my post, it would be quite clear that if my portfolio value went down 50%, it would not affect my retirement income one bit. Sure my portfolio was down about 45% in 2008, but by 2011, it was back above where it ...

I've gotten really good service out of Interstate batteries http://en.wikipedia.org/wiki/Interstate_Batteries : Interstate Battery System of America, Inc., a.k.a. Interstate Batteries, is a privately owned company that markets automotive batteries manufactured by Johnson Controls through independen...

IMO, there is no "over-valued or "undervalued". Stocks have some expected future earnings and dividends, and the price you pay will determine the return you can expect from that future cash-flow. The higher the price, the lower the expected return. I suppose one could say that the ma...

In your shoes I personally would not have moved home. I love my parents and we got along fine. But I would not have moved home unless the situation was truly dire. I would have found a school I could afford and a place I could afford. In fact that is exactly what I did. As it turns out my almost 26 ...

90 years of data gives all of three 30-year data points. Rolling periods may give more numbers, good for making pretty scatter plots, but all of them are just remixes of three honestly independent data points (at best, as the the second is dependent on the particular history that led to point one, ...

The trouble that I have, and I expect others may as well, is that bold moves are psychologically hard to make. If my IPS states that I must adjust 3% out of stocks for each 1pt move in P/E10 above 23 (or add 3% for each move below 11), I can stomach those smaller changes. The challenge is that 3% i...

Then everything took a dump and people lost their shirts. The good news about the 2001 tech crash, just as with the 2008-2009 financial collapse, is that those that stayed in the broad market, even rebalanced, ended up regaining not only their shirt, but a pair of pants and maybe some shoes as well...

90 years of data gives all of three 30-year data points. Rolling periods may give more numbers, good for making pretty scatter plots, but all of them are just remixes of three honestly independent data points (at best, as the the second is dependent on the particular history that led to point one, ...