Bogleheads.org

Rick Ferri recently commented that the hedging of the US dollar has costs and therefor feels that the fund is not worth it. He stated that USD hedging approximately doubles the expense. Essentially the .2% ER is close to .4% due to the hidden hedging cost. SpringMan: Vanguard published this article...

Bogleheads: Vanguard has been crossing the country with its At-Cost Cafe truck , which markets Vanguard's at-cost structure by selling coffee for $0.26 per cup. It's a good shtick and a dramatic illustration of how disruptive Vanguard has been to the U.S. fund industry. Source: Morningstar Best wish...

Any ideas about how the new Total International Bond Fund will affect the 3-Fund portfolio recommended on this forum? Fillol Fillol: I am studying the theory, the effect, and the practical benefit of adding an international bond fund to The Three Fund Portfolio. "There seems to be some pervers...

Mr. Bogle has examined the long-term returns of growth and value stocks and explains why he prefers a total market index fund. Bogleheads can read about it in this 2002 Keynote speech he gave at the Morningstar Investment Conference in Chicago (I heard him give it). Or you can read the work of Prof...

Mr. Bogle has examined the long-term returns of growth and value stocks and explains why he prefers a total market index fund. Bogleheads can read about it in this 2002 Keynote speech he gave at the Morningstar Investment Conference in Chicago (I heard him give it). The Telltale Chart Best wishes. T...

avn2109 wrote:I want to own a diversified portfolio of real estate in a single market (say NYC or Chicago)

Avn:

Do you realize that "a diversified portfolio of real estate in a single market" is an oxymoron?

Best wishes.
Taylor

guitarguy wrote:

I enjoy getting her flowers randomly so much more.

I made a habit of bringing my wife a bouquet of inexpensive flowers about once a week. Probably the best investment I ever made.

Best wishes.
Taylor

Adding small value is also a tilt towards small value and away from small growth (aka the "black hole of investing".) The "black hole of investing" has done quite well. These are annualized returns for Vanguard Small-Cap Growth (VISGX) and Vanguard Small-Cap Value (VISVX) funds:...

I'm getting married in about six weeks and I'm still struggling with a wedding gift for my soon to be wife. What did you get your wife? Any suggestions or lessons learned? Camoaero: We were married 62 years ago. I never heard of anyone (except possibly a self-serving shopkeeper) suggesting that the...

Kathleen:

Thank you, from myself and all the other Boglehead fathers who learn and contribute to this forum.

Best wishes
Taylor

He (Mr. Bogle) is 84. I know there are people here who don't believe that cognitive decline comes with age, but you are in a tiny minority. Read any scientific study of aging and you will see that by age 80 there is a definite measurable mental decline. Mr. Bogle's "cognitive decline" (if...

Bogleheads: These are excerpts from a new Rick Ferri article about " Past Performance ": Wishing Upon a Star Manager Doesn't Work: "71% of current owners rank past performance as “very influential” or “somewhat influential” when selecting mutual funds, according to survey conducted by...

What does it take to successfully convert someone to a Boglehead? Rick: This is the Boglehead Philosophy: 1 Develop a workable plan 2 Invest early and often 3 Never bear too much or too little risk 4 Diversify 5 Never try to time the market 6 Use index funds when possible 7 Keep Costs Low 8 Minimiz...

I'm mid-twenties and just started my first "real" job. It pays $50k / year and I will earn about $25k for tax year 2013. The nature of my career is I will earn $50k/year for 5 years and then about $200k annually after that. Obviously, I would like to pay taxes now rather than later. My jo...

Jay wrote: I am not able to understand how the taxes in the taxable account will work. When I rebalance (which is essentially selling and buying shares), should I only rebalance in the IRAs (since they're tax sheltered)? If you rebalance in your taxable account at this time, you will probably be sel...

Big Worm: Our mentor, Jack Bogle, wrote in Common Sense on Mutual Funds : After nearly fifty years in this business, I do not know of anybody who has done it (market timing) successfully and consistently. I don't even know anybody who knows anybody who has done it successfully and consistently. Your...

Calm Man wrote: Since I am rather sensitive to taxes as many of us are, is it a case of cutting off one's nose to spite the face to just go with TMI (Tax Managed International) instead of TISM (Total International)? No one can tell you which fund will have the higher after-tax return and the least v...

Bogleheads: Readers of this forum, know that Bogleheads are not fans of Variable Annuities. In his latest newsletter, Mike Piper, editor of the Oblivious Investor , gives a good example of the promises of a variable annuity compared with actuality. Variable Annuity with a 5.5% Guaranteed Growth Rate...

I'm working on simplifying our (I'm married) investments and wonder if it makes sense to use my TSP G fund as our only bond fund. We are both 39 and right now are probably a bit low on our bond allocation. I'm thinking 20-25% in the TSP G fund (I also have a pension that is growing each year). Is t...

I can tell you from experience that you can copy an adviser's portfolio or come up with your own logical allocation, the results of all portfolios with the same equity and fixed income allocation are going to be based on risk and randomness ~ and more so on randomness. One intelligently crafted mix...

Bogleheads:

"There seems to be some perverse human characteristic that likes to make easy things difficult." -- Warren Buffett

Best wishes.
Taylor

John: Do you also see dropping total bond market as a solution? I don't have the choice in my 401, I don't know if I would hold total bond index. Would you hold total bond or switch to CDs as link mentioned? I intend to hold the diversified Total Bond Market Index Fund. It's Tracking Index performan...

RNJ:

When Vanguard speaks--I listen. When Allan Roth speaks--I listen. When they agree--I listen intently.

Thank you and best wishes.
Taylor

Sir Horice: Your chart showing the superiority of Wellesley's past performance over each of the three individual total market index funds is enticing. However, this is what investing authorities tell us about using "past performance" to select funds: Frank Armstrong, financial author: &quo...

Casey: This is what investing authorities (and the government) say about using past performance to pick mutual funds: Jack Bogle: "In selecting equity funds, no analysis of the past, no matter how painstaking, assures future superiority." Frank Armstrong, financial author: "Rating ser...

Taylor, I know you could never be accused of market timing, but your switch in TIPS funds seems to have worked out very well: VIPSX (original TIPS fund): -4.62% YTD VTAPX (short-term TIPS index): -1.08% YTD Congratulations! Brad Brad: I try not to confuse "brains" with "good luck.&qu...

markmadsden: Welcome to the Bogleheads Forum! I like how you are using a Target Retirement Income Fund in your Roth for a part of your emergency fund if it should be needed. I have not seen that before. Your reading has helped you structure a Boglehead portfolio that contains all the characteristics...

Nisiprius: Thank you for the link to Mr. Rekenthaler's article. For Bogleheads interested in the history of the mutual fund industry and indexing, the article contains a link to a lengthy speech on the subject that Mr. Bogle recently delivered to The Boston Security Analysts Society . BIG MONEY IN B...

Black Swan: Owning a managed and diversified (lower risk) portfolio of every marketable individual stock in the United States, at a cost of only 0.05%/year Admiral shares, is a fantastic value. Mr. Bogle wrote in Bogle on Mutual Funds: "Attempting to build an investment program around a handful...

Rick:

I agree with you. The more I learn about investing, the more I realize what I don't know.

"Expert" is a bad word. For a long time I avoided using it. However, nearly everyone seems to accept it, so I use it again.

Taylor

Bogleheads: The Wall Street Journal asked a group of investing experts (including our own Rick Ferri): "What's the most important lesson for investors from the 2008 stock market meltdown?" This is their answer: http://online.wsj.com/article/SB10001424127887324178904578342792079645644.html?...

xram: Personally, I would not bother with a taxable international bond fund unless I could put it within a tax-advantaged account. Even then, I would only add it to a large portfolio where it would be at least 20% of the bond allocation. Strive for simplicity -- not complexity. Best wishes. Taylor ...

Meglin: Welcome to the Bogleheads forum. Due to concerns about the US debt, monetary policy, and US stocks being overvalued, I also read some Peter Schiff and Jim Rogers -- Then I designed a portfolio, which I thought was a good distillation of the above strategies, and invested in it in November 20...

Keyle:

You can read about it here:

viewtopic.php?f=10&t=111986

I understand there are only a few openings left.

Best wishes.
Taylor

Bogleads:

This tool shows the different tax rates for different states (New York is highest; Alaska lowest):

http://www.usatoday.com/story/money/per ... n/1937757/

Best wishes.
Taylor

Howard:

Thanks for the link and the title to your post.

Best wishes.
Taylor

rec7:

Interesting article with several things to remember like this:

No, the portfolio does not have to be tucked away in the Cayman Islands. It can be invested through a U.S. brokerage account in mainstream funds like Vanguard Total Stock Market. . .

Thank you and best wishes.
Taylor

SippinHenn: What does Bogleheads feeling on this allocation for someone who would be theoretically retiring in approx. 43 years? The target fund allocation looks reasonable to me for a risk tolerant , young investor. Nevertheless, I would put more weight on an allocation recommended by Vanguard expe...

EmergDoc:

I love your illustration of how taxes can affect various funds differently. I haven't seen that easy-to-understand illustration before.

Thank you and best wishes.
Taylor

Hi Everyone, First post here, so I apologize if this question has been answered previously. My question is regarding how to calculate the efficient frontier. Specifically, lets say that I have 20 years of historical data for 20 asset classes and I calculate the variance and mean return for each ass...

xram: Personally, I would not bother with a taxable international bond fund unless I could put it within a tax-advantaged account. Even then, I would only add it to a large portfolio where it would be at least 20% of the bond allocation. Strive for simplicity -- not complexity. Best wishes. Taylor

Thanks for your thought Taylor. I pretty much agree with you. The one thing I wonder about is just in theory, but not in practice because I don't slice and dice very intricately. However, it does seem that there are cases where emerging market currency would go down relative to the dollar, while em...

beman wrote: My question to all in here: is re- balancing a hard thing to do, or is it fairly straight forward and not hard at all. One of the big advantages of The Three Fund Portfolio is that it greatly minimizes rebalancing because all the volitile sub-categories rebalance themselves (value, grow...

Thanks for the link. I didn't realize Vanguard had an emerging markets bond fund. There has been so much talk about the total international bond fund, and no talk about this. tc: In my opinion, investing in an International Emerging Markets Bond Fund is more akin to gambling than investing. If an i...

Hi Spencer

The fund industry (Vanguard's an exception) is not going to like that article.

Thank you and best wishes.
Taylor

tc101:

Our wiki has good information:

http://www.bogleheads.org/wiki/Emerging_Market_Bonds

Best wishes.
Taylor

Where are folks holding the international bond fund? 401k? IRA? Taxable? xram: Taxable bonds should seldom be located in taxable accounts where dividends are taxed annually at higher income tax rates. In my opinion, it makes little difference between holding them in a 401k or an IRA. Dividends (yie...

knopflergrass wrote: If I withdraw a larger sum of money to buy a car let's say from an underperforming fund, rather than having only a single larger fund, say a VF total stock market, to withdraw from, won't that result in substantial tax savings? You are selling low. This is the opposite of what y...

I'm curious as to why investment-grade-only bond indexes are popular, and not simply "total" bond market indexes. Focusing on investment-grade indexes seems akin to just having large-cap indexes. ftobin: Nearly all investing authorities believe that bonds are primarily to provide safety i...

Storm Shadow: If you want to correct the mistake-- do it immediately by phone and document your call (time, date, who you talked to). Back-up your call with Vanguard's website e-mail service. Vanguard will almost certainly correct their mistake -- and even if their tape shows they misunderstood your...