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Re: Investors Pour Into Vanguard, Eschewing Stock Pickers

Could this all be happening because of the strong bull market? I wonder if people are jumping on board seeing that S&P 500 doubled its value during the last 5 years (actually ~2.5x w/ dividends re-invested). Will they stay on board when the next big correction comes? Hi Erhan, That is an intere...
by asset_chaos
Fri Aug 22, 2014 8:04 pm
 
Forum: Investing - Theory, News & General
Topic: Investors Pour Into Vanguard, Eschewing Stock Pickers
Replies: 65
Views: 5035

Re: When did you hear of Bill Miller and Legg Mason Value Tr

I think I first read about him and his streak on this forum from someone posting on how the streak was over or looked soon to be over. If the streak ended 2005, then my first notice of Miller and the streak would have been around 2006 perhaps.
by asset_chaos
Fri Aug 22, 2014 7:54 pm
 
Forum: Investing - Theory, News & General
Topic: When did you hear of Bill Miller and Legg Mason Value Trust?
Replies: 26
Views: 1656

Re: Currency risk for australian investor

Well done on having thought, researched and made a financial plan. You should be mildly concerned about risk from currency moves, but currency risk is by no means the only risk of home bias. The other major risk of home bias investing, particularly if your home is a small market, is sector concentra...
by asset_chaos
Fri Aug 22, 2014 7:35 pm
 
Forum: Investing - Help with Personal Investments
Topic: Currency risk for australian investor
Replies: 6
Views: 325

Re: Do Super wealthy have access to different investing vehi

If you're super rich in one of the countries with a less than democratically accountable government, then it is possible to partner---more or less secretly---with politicians to form a company that is granted an effective or near monopoly on some part of the local economy. I expect those investments...
by asset_chaos
Tue Aug 19, 2014 8:49 am
 
Forum: Investing - Theory, News & General
Topic: Do Super wealthy have access to different investing vehicles
Replies: 76
Views: 6196

Re: Barry Ritholtz: Using the news

Most people would be better off ignoring the financial media in its entirety. Or make that the for profit financial media. Media like Bogleheads and many of the members blogs and articles are well worth noting.
by asset_chaos
Tue Aug 12, 2014 4:49 pm
 
Forum: Investing - Theory, News & General
Topic: Barry Ritholtz: Using the news
Replies: 15
Views: 1820

Re: Poll: What's the name of Argentina's stock market?

MSCI say here http://www.msci.com/products/indexes/market_classification.html that Argentina moved to the frontier index from the emerging index in May 2009. Indeed here http://www.msci.com/products/indexes/licensing/msci_emerging_markets/Timeline_25_year_EM.pdf MSCI has a delightful poster about 25...
by asset_chaos
Mon Aug 11, 2014 10:01 pm
 
Forum: Investing - Theory, News & General
Topic: Poll: What's the name of Argentina's stock market?
Replies: 37
Views: 2309

Re: Risk and Return of Tilted and Market Balanced Funds

I think both Larry and asset-chaos may be misinterpreting M*'s average credit rating for bond funds. I have no comment on how this affects the discussion. It' s above my pay grade. Thanks Doc. I can't speak for Larry, but I certainly was misinterpreting M*'s average credit rating. I assumed it was ...
by asset_chaos
Mon Aug 11, 2014 9:41 pm
 
Forum: Investing - Theory, News & General
Topic: Risk and Return of Tilted and Market Balanced Funds
Replies: 19
Views: 2467

Re: Risk and Return of Tilted and Market Balanced Funds

Sorry, this is supposed to be a discussion. I posted and then had to go out of town. Thank you all for the comments. The advantage is now I can post responses all at once instead of piecemeal. Nisiprius: The way I came to grips with the likelihood of period dependence is to play the academic’s trick...
by asset_chaos
Mon Aug 11, 2014 2:14 am
 
Forum: Investing - Theory, News & General
Topic: Risk and Return of Tilted and Market Balanced Funds
Replies: 19
Views: 2467

Re: Poll: What's the name of Argentina's stock market?

At first I thought this was a trick question. Argentina instituted currency controls some years ago, and I thought that was enough to get a country booted out of international indices from outfits like MSCI and FTSE. I was expecting that no one invested via index funds had any current investment in ...
by asset_chaos
Mon Aug 11, 2014 12:50 am
 
Forum: Investing - Theory, News & General
Topic: Poll: What's the name of Argentina's stock market?
Replies: 37
Views: 2309

Risk and Return of Tilted and Market Balanced Funds

A frequent topic on this board concerns titled portfolios versus total market portfolios. Tilt most often means over-weighting small and value stocks though Fama-French (FF) factors. Duration and credit FF factors apply to bonds. More recently other factors, such as momentum and quality, have been t...
by asset_chaos
Tue Aug 05, 2014 1:56 am
 
Forum: Investing - Theory, News & General
Topic: Risk and Return of Tilted and Market Balanced Funds
Replies: 19
Views: 2467

Re: Should retirement investors own small/value stocks at al

Retired investors certainly do make systematic changes to their portfolios. In retirement, though, these changes are withdrawls instead of deposits. But the effect is the same. During accumulation, deposits went into the recently poorly performing assets to rebalance to plan. Managing a portfolio on...
by asset_chaos
Tue Jul 29, 2014 4:14 pm
 
Forum: Investing - Theory, News & General
Topic: Should retirement investors own small/value stocks at all?
Replies: 36
Views: 2927

Re: Australian - buying international shares fund?

Have you considered Vanguard's LifeStrategy funds? There are several with various ratios of stocks (foreign and domestic) and bonds. A single, simple fund with a stock bond balance that's appropriate for your personal circumstances may be right for you. Also, having all your investment in a single f...
by asset_chaos
Tue Jul 29, 2014 4:02 pm
 
Forum: Investing - Help with Personal Investments
Topic: Australian - buying international shares fund?
Replies: 6
Views: 307

Re: "Gel" investment strategy around midlife?

A crucial part that's missing from your argument is theory: does the "discovery" in question make economic sense. It's long term data coupled to a sensible reason for why a financial market should work that way that makes for a compelling argument that may become compelling enough to warre...
by asset_chaos
Thu Jul 24, 2014 10:59 pm
 
Forum: Investing - Theory, News & General
Topic: "Gel" investment strategy around midlife?
Replies: 5
Views: 847

Re: Vanguard not vigilant about taxes?

Was it last year when all of South Korea migrated from emerging to developed when the funds changed indexes? Did that generate taxable distributions to fund investors; I don't recall, but I think not? Moving all of South Korea I expect would have been a much larger maneuver than moving this single c...
by asset_chaos
Wed Jul 23, 2014 9:00 pm
 
Forum: Investing - Theory, News & General
Topic: Vanguard not vigilant about taxes?
Replies: 15
Views: 1670

Re: Question about Vanguard ETFs for non-US investors

The interest from US municipal bonds is free from US federal income tax. This means the interest rate they pay is typically (though not strictly always) lower than for taxable US bonds of similar credit quality and duration. A non-US person who doesn't pay US tax anyway wouldn't benefit from owning ...
by asset_chaos
Mon Jul 21, 2014 5:48 am
 
Forum: Investing - Help with Personal Investments
Topic: Question about Vanguard ETFs for non-US investors
Replies: 6
Views: 708

Buttonwood does Bernstein

The Ecomomist columnist who goes by the nom de plume of Buttonwood has written on "The conundrum of asset allocation" featuring ideas from the new book by Bill Berstein, Rational Investing , here http://www.economist.com/news/finance-and-economics/21607848-conundrum-asset-allocation-no-eas...
by asset_chaos
Fri Jul 18, 2014 1:09 am
 
Forum: Investing - Theory, News & General
Topic: Buttonwood does Bernstein
Replies: 0
Views: 436

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

It's hard to say because I don't know the risk profile of the average investor. It may not even be a well-posed question. Here's a version of the question, however, that can be unambiguously answered, if we assemble the right data. What is the risk in your portfolio compared to the aggregate risk in...
by asset_chaos
Sun Jul 13, 2014 10:36 pm
 
Forum: Investing - Theory, News & General
Topic: [Poll] Are you more risk averse than average?
Replies: 36
Views: 2744

Re: What ONE investing book or article for skeptical sibling

Someone skeptical of investing and leaning towards gold and real estate may not read all the way through a good book. A short article or two, that the skeptic may read to completion, may make more of an impression, or at least give a little nudge down the right path. Some that come to mind are the W...
by asset_chaos
Fri Jul 11, 2014 1:12 am
 
Forum: Investing - Theory, News & General
Topic: What ONE investing book or article for skeptical sibling?
Replies: 30
Views: 2924

Re: How to Handle a Multi-Generational Trust

On question 1, I suggest you want funds that anyone could reasonably hold as core investment funds, regardless of their age. Then family members don't have to sell investments and incur taxes when the trust disolves. Such funds could include total world stock market, total US stock market, total non...
by asset_chaos
Tue Jul 08, 2014 11:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: How to Handle a Multi-Generational Trust
Replies: 23
Views: 2862

Re: stocks about to plunge

"stocks about to plunge"

Zippy, this would make my rebalancing decisions so much easier!
by asset_chaos
Tue Jul 08, 2014 11:12 pm
 
Forum: Investing - Theory, News & General
Topic: stocks about to plunge
Replies: 39
Views: 7797

Re: Pension Portfolio for 77yr old Nonno - in Australia

Seems like a reasonable portfolio for the stated goals. A couple of comments. Is the 77 year old ok with it? It's her money, and while I'm sure she appreciates your interest and help, will the portfolio let the old person sleep well whenever the next stock market down turn comes? For someone near 80...
by asset_chaos
Sun Jun 29, 2014 5:31 pm
 
Forum: Investing - Help with Personal Investments
Topic: Pension Portfolio for 77yr old Nonno - in Australia
Replies: 7
Views: 488

Re: World Market Cap Representation

By market do you mean stock market or sum of stock and bond markets? If stock, some of those numbers are way off. For stocks you could look at https://personal.vanguard.com/us/funds/snapshot?FundId=0628&FundIntExt=INT both for a country list of of global stock market share and for a suggestion o...
by asset_chaos
Tue Jun 17, 2014 9:56 pm
 
Forum: Investing - Help with Personal Investments
Topic: World Market Cap Representation
Replies: 4
Views: 559

Re: How much does cost matter? (Plotting ER vs. Alpha)

I recall that Bill Bernstein made a similar plot in one of his Efficient Frontier articles. I also seem to recall that he found that the decrease in return was greater than the expense ratio and conjectured that this was due to the other expenses that are only visible in footnotes or hidden altogeth...
by asset_chaos
Sun Jun 15, 2014 8:51 pm
 
Forum: Investing - Theory, News & General
Topic: How much does cost matter? (Plotting ER vs. Alpha)
Replies: 15
Views: 1112

Re: Why would I need VT, BND AND VTI?

Non-US citizens should ignore most discussions on this board about the split in US/non-US stock allocation. That's not because it's wrong per se, it's because it's overwhelmingly based on the preferences (dare I say biases), point of view and needs of the US investor. The non-US stock investor, whos...
by asset_chaos
Fri Jun 13, 2014 7:57 am
 
Forum: Investing - Help with Personal Investments
Topic: Why would I need VT, BND AND VTI?
Replies: 4
Views: 581

Re: Inherited Unit trusts and individual bonds

I suggest the muni bond trusts are inappropriate inside the IRA, and therefore those should be sold as soon as reasonable and the proceeds reinvested as per your plan. For the corporate bonds those higher interest payments are there for the term risk (interest rates could rise during the term of the...
by asset_chaos
Fri Jun 13, 2014 7:43 am
 
Forum: Investing - Help with Personal Investments
Topic: Inherited Unit trusts and individual bonds
Replies: 8
Views: 543

Re: Bernstein: A Decade of Super-Low Returns

I don't see the 2.5 from the numbers in the table and the postulated asset allocation of 40% bonds, 20% non-US (about 30% of the 60% sock allocation) and 40% US stocks. I get at best -1*0.4 + 5*0.2 + 2*0.4 = 1.4. Does Bernstein expect multiple expansion for the other 1 percent? I've ordered the book...
by asset_chaos
Mon Jun 09, 2014 5:55 pm
 
Forum: Investing - Theory, News & General
Topic: Bernstein: A Decade of Super-Low Returns [1.4% for 60/40]
Replies: 207
Views: 17469

Re: What are you doing with the market at an all time high?

Sometime in the first half of July I'll run rebalancing calculations, as per my usual schedule. If rebalancing thresholds have been breached, I'll think about exactly how and where to rebalance. If no rebalancing thresholds have been breached, I'll continue to do nothing portfolio-wise.
by asset_chaos
Sun Jun 08, 2014 7:24 pm
 
Forum: Investing - Help with Personal Investments
Topic: What are you doing with the market at an all time high?
Replies: 95
Views: 6553

Re: Would you work without pay?

I'm a scientist too, and the science part of my job I'd do for free. Certainly I've worked the science part happily for much less money than I'm paid now. But the other parts of the job, budgeting, people management, internal reorganization meetings, chasing funding, marketing, for those they have t...
by asset_chaos
Thu May 29, 2014 5:45 pm
 
Forum: Personal Finance (Not Investing)
Topic: Would you work without pay?
Replies: 63
Views: 4041

Re: Vanguard Continues to Lower Expenses

Let's see them lowered for the Lifestrategy funds! Or at least when you accumulate a certain amount in them then the ER lowers! Something....anything.... :happy LifeStrategy fees have declined somewhat over the years. For instance, in 2008 LS Growth cost 21 bp, and today it's 17; although, that may...
by asset_chaos
Thu May 29, 2014 12:55 am
 
Forum: Investing - Theory, News & General
Topic: Vanguard Continues to Lower Expenses
Replies: 15
Views: 3624

Re: This market is a snoozer, do you like it?

What happened to 2010?
by asset_chaos
Wed May 28, 2014 2:45 am
 
Forum: Investing - Theory, News & General
Topic: This market is a snoozer, do you like it?
Replies: 45
Views: 4538

Re: Investment Feedback Particularly Welcome. [Australia]

Anyway, I see an easy way for you to get 20% into safety that you can rebalance from in a big crash. How would I get 20% to safety, do you mean after I much 80% of the portpolio? Can you please elaborate on this point. I shouldn't speak for others, but I think he's saying obliquely what others said...
by asset_chaos
Mon May 26, 2014 6:59 am
 
Forum: Investing - Help with Personal Investments
Topic: Investment Feedback Particularly Welcome. [Australia]
Replies: 13
Views: 497

Re: Investment Feedback Particularly Welcome. [Australia]

As for the silver, I really enjoy having it and looking at it. So I suppose it has a side benefit. Ha, ha, ha, now I wonder if you're pulling our leg. I became curious and this site http://www.24hgold.com/english/gold_silver_prices_charts.aspx?money=AUSD&p=argent , about whose reliability I kno...
by asset_chaos
Mon May 26, 2014 6:49 am
 
Forum: Investing - Help with Personal Investments
Topic: Investment Feedback Particularly Welcome. [Australia]
Replies: 13
Views: 497

Re: 401k while in Australia? Help

Thank you daffyd. I did not know that one could be living in Australia for years and not be a resident for super purposes. My own super will not provide any helpful guidelines because I'm in a defined benefit fund. That's a good point about the Roth, but I think if the OP has enough US sourced incom...
by asset_chaos
Sun May 25, 2014 10:21 pm
 
Forum: Investing - Help with Personal Investments
Topic: 401k while in Australia? Help
Replies: 4
Views: 455

Re: How to Invest Trust Assets for income & growth

I'm not sure how selling stocks would generate income for me unless the gains are short term capital gains. Any long term gains become part of the principal I believe. I think that's not correct. Gains of any type can be distributed. You list their character on the K-1. Long term and short term cap...
by asset_chaos
Sun May 25, 2014 5:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: How to Invest Trust Assets for income & growth
Replies: 18
Views: 1312

Re: I need some "hand-holding" right now...

the new law is FATCA, voted on in 2010, becoming effective only now, July 1, 2014. I've read it will be the official start of the US dollar's collapse. Not sure why, but sounds bad! FATCA only applies to foreign, i.e. non-US, accounts, so it won't even be noticed by most Americans. And by most, I m...
by asset_chaos
Sat May 24, 2014 8:24 pm
 
Forum: Investing - Theory, News & General
Topic: I need some "hand-holding" right now...
Replies: 51
Views: 5396

Re: 401k while in Australia? Help

When we move back to the US we’ll get a check for the whole amount. I'd double check on that. You say your wife will be an Australian resident working for an Australian company. Normally early access to superannuation is legally restricted to a small set of hardship circumstances. Leaving the count...
by asset_chaos
Sat May 24, 2014 7:55 pm
 
Forum: Investing - Help with Personal Investments
Topic: 401k while in Australia? Help
Replies: 4
Views: 455

Re: How to Invest Trust Assets for income & growth

One thing to consider is that when your children receive the trust assets there is no step up in basis. So you want investments that they could hold as core investments, regardless of what stage of life they're in at the time. I think this means you want separate stock and bond funds, broadly divers...
by asset_chaos
Sat May 24, 2014 7:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: How to Invest Trust Assets for income & growth
Replies: 18
Views: 1312

Re: We won best paper from S&P SPIVA worldwide!

Good paper, well deserved reward.
by asset_chaos
Thu May 22, 2014 4:32 pm
 
Forum: Investing - Theory, News & General
Topic: We won best paper from S&P SPIVA worldwide!
Replies: 39
Views: 3205

Re: My take on AQR paper on myths about MOM

Alpha? We have lots of data on managed funds returns. Where's the alpha? There has been no management alpha in aggregate, and where it does show up, it's not persistent. That's usually attributed to the high costs of active management. If you're saying that a large, persistent momentum premium has s...
by asset_chaos
Wed May 21, 2014 5:51 pm
 
Forum: Investing - Theory, News & General
Topic: My take on AQR paper on myths about MOM
Replies: 7
Views: 868

Re: My take on AQR paper on myths about MOM

If momentum is persistent, has a huge return, and isn't obliterated by trading costs and taxes, the question is why haven't people been making a gazillion dollars off it for the last half century or so? There's a bit of a too good to be true flavor about some of the numbers being touted for momentum...
by asset_chaos
Tue May 20, 2014 5:36 pm
 
Forum: Investing - Theory, News & General
Topic: My take on AQR paper on myths about MOM
Replies: 7
Views: 868

Re: Muni component in Life Strategy funds

What you want doesn't exist, and, due to lack of demand, probably won't exist. Three alternatives come to mind. 1) Set your taxable stock:bond ratio with individual funds and just never rebalance. The balanced funds in tax deferred will keep a portion (you don't say if it's a large or small portion)...
by asset_chaos
Tue May 20, 2014 5:16 pm
 
Forum: Personal Finance (Not Investing)
Topic: Muni component in Life Strategy funds
Replies: 14
Views: 891

Re: Poll:Do small stocks have higher expected returns than l

The absolute degree of risk of stocks and of bonds changes over time, as does the relative risk of the two. You likely have much less control over portfolio risk than is implied by "I have control of total portfolio risk through an appropriate bond allocation." Maybe true at the margins b...
by asset_chaos
Tue May 13, 2014 4:14 pm
 
Forum: Investing - Theory, News & General
Topic: Poll:Do small stocks have higher expected returns than large
Replies: 78
Views: 4774

Re: "Fortune favors the bold" (or does it?)

The OP is correct. We celebrate the successful. The many, many other people whose gambles, all as bold as those of the successful, failed are, depending on their field of endeavor, forgotten or buried. But it's good that, short of fatality, people behind failed ideas can try again and again.
by asset_chaos
Tue May 13, 2014 1:16 am
 
Forum: Investing - Theory, News & General
Topic: "Fortune favors the bold" (or does it?)
Replies: 31
Views: 2521

Re: Poll:Do small stocks have higher expected returns than l

Expected higher return and expected higher risk (standard deviation). I'm happy to take a gamble on higher long term returns if the higher risks are proportionate and I have control of total portfolio risk through an appropriate bond allocation. As Bogle has said here http://www.vanguard.com/bogle_s...
by asset_chaos
Tue May 13, 2014 1:00 am
 
Forum: Investing - Theory, News & General
Topic: Poll:Do small stocks have higher expected returns than large
Replies: 78
Views: 4774

Re: Graduation Gifts - PhD

Gift certificate for U-Haul or similar because she's likely moving.
by asset_chaos
Mon May 12, 2014 6:28 pm
 
Forum: Personal Consumer Issues
Topic: Graduation Gifts - PhD
Replies: 15
Views: 1262

Re: Australian index funds

You specified a safe investment. How safe do you mean? If your sister means an investment gift that the girls will tap one day for their own retirement, then several of the stock heavy suggestions are reasonable. If, however, she means that the money should be there with certainty in 13 years to be ...
by asset_chaos
Mon May 12, 2014 2:27 am
 
Forum: Investing - Help with Personal Investments
Topic: Australian index funds
Replies: 12
Views: 823

Re: Why is Two Fund Less Popular Than Three Fund Portfolio?

Since the OP is from the UK, I'll add my two cents worth of comment of the size and type of grain of salt that non-US persons should take along with advice on this board. The US stock investor is unique in that he is the only investor that can be completely home biased and be within a factor of 10 o...
by asset_chaos
Wed May 07, 2014 10:39 pm
 
Forum: Investing - Theory, News & General
Topic: Why is Two Fund Less Popular Than Three Fund Portfolio?
Replies: 145
Views: 10624

Re: Global small cap fund

Global factor funds don't seem to exist. Which is somewhat surprising in this era of wild ETF proliferation.
by asset_chaos
Wed May 07, 2014 5:46 pm
 
Forum: Investing - Help with Personal Investments
Topic: Global small cap fund
Replies: 5
Views: 582

Re: Lump summing into a 529 -- What would you do?

Your 529 investment results will, I believe, have a high degree of period dependency, aka luck, no matter whether you lump sum or DCA. As a personal example of the variability, our lump sum invested in 2006 has today accumulated earnings of about 70% of the initial sum, while the lump invested in 20...
by asset_chaos
Tue May 06, 2014 10:43 pm
 
Forum: Investing - Help with Personal Investments
Topic: Lump summing into a 529 -- What would you do?
Replies: 14
Views: 879

Re: Buffett pulls further ahead

The Wizard wrote:Some hedge funds do better in Down Years, right?
So we need a few of those to level the playing field...

My memory's starting to go dodgy, but I could have sworn that 2008 qualified as a down year.-)
by asset_chaos
Mon May 05, 2014 1:58 am
 
Forum: Investing - Theory, News & General
Topic: Buffett pulls further ahead
Replies: 16
Views: 3099
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