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Re: "Rollover IRA" vs "Traditional IRA"

Then why do firms like Vanguard bother distinguishing between the two?
by boggler
Thu Apr 24, 2014 11:51 am
 
Forum: Investing - Help with Personal Investments
Topic: "Rollover IRA" vs "Traditional IRA"
Replies: 4
Views: 201

"Rollover IRA" vs "Traditional IRA"

What's the difference between a "Rollover IRA" and a "Traditional IRA"? You can roll assets from 401k's into either type of account, and you can make tax-deferred contributions to either type of account. Everything I've seen seems to indicate that they are treated the same way. I...
by boggler
Thu Apr 24, 2014 11:21 am
 
Forum: Investing - Help with Personal Investments
Topic: "Rollover IRA" vs "Traditional IRA"
Replies: 4
Views: 201

Re: Is social security a good investment?

I predict a lock....in less than 3..2..1. It's unactionable - and not only that, but you are comparing apples to oranges. Social Security Old Age Disability Insurance - do you see the word "investment" in any part of the official title of the program? It's actionable to me because I'm try...
by boggler
Tue Apr 22, 2014 2:00 pm
 
Forum: Investing - Theory, News & General
Topic: Is social security a good investment?
Replies: 33
Views: 1439

Re: Is social security a good investment?

Oicuryy wrote:Social Security is not an investment. It is a welfare program funded by a payroll tax. Some people will get more in benefits than they pay in taxes. Others will get less.


Who? And at what rate of return?
by boggler
Tue Apr 22, 2014 1:57 pm
 
Forum: Investing - Theory, News & General
Topic: Is social security a good investment?
Replies: 33
Views: 1439

Re: Is social security a good investment?

I predict a lock....in less than 3..2..1. It's unactionable - and not only that, but you are comparing apples to oranges. Social Security Old Age Disability Insurance - do you see the word "investment" in any part of the official title of the program? It's actionable to me because I'm try...
by boggler
Tue Apr 22, 2014 1:26 pm
 
Forum: Investing - Theory, News & General
Topic: Is social security a good investment?
Replies: 33
Views: 1439

Re: Is social security a good investment?

Most people who ask this question don't know what Social Security includes. Are you asking about all of SS or just one part? P.S. If you are not careful, this thread will become political and either get locked or disappear. All the parts, I suppose. I'm interested from the perspective of analyzing ...
by boggler
Tue Apr 22, 2014 12:34 pm
 
Forum: Investing - Theory, News & General
Topic: Is social security a good investment?
Replies: 33
Views: 1439

Is social security a good investment?

How do bogleheads think about social security?
If, hypothetically, you had a choice over whether to pay into the system, how would you decide whether it's a good idea?
Would you be better off saving the contributions in a Vanguard account?
by boggler
Tue Apr 22, 2014 12:24 pm
 
Forum: Investing - Theory, News & General
Topic: Is social security a good investment?
Replies: 33
Views: 1439

Re: Recharacterized backdoor Roth contribution - how to repo

You are OK. The code N confirms that you recharacterized the conversion back to a TIRA account and you report the contribution as a TIRA contribution. Just hope your income allows you to deduct that contribution or you will be stuck with a non deductible TIRA contribution. Of course, if that happen...
by boggler
Fri Apr 11, 2014 1:23 am
 
Forum: Personal Finance (Not Investing)
Topic: Recharacterized backdoor Roth contribution - how to report?
Replies: 2
Views: 188

Recharacterized backdoor Roth contribution - how to report?

I contributed the max to a traditional IRA last year, then did a backdoor conversion to a Roth, and then decided I would prefer the deduction of the traditional IRA so I recharacterized it. I got a 1099R with code 02 showing the original conversion, and then a 1099R with code N showing the recharact...
by boggler
Thu Apr 10, 2014 12:04 pm
 
Forum: Personal Finance (Not Investing)
Topic: Recharacterized backdoor Roth contribution - how to report?
Replies: 2
Views: 188

Re: If trading is a losing game, how do you explain prop fir

EMH is folklore and true only in the limit of equilibrium (well, almost by definition true then). To you, who are slow and ungainly to see and act, the market appears in equilibrium all the time (except under extreme circumstances). To others who see and work with more detail, events happen constan...
by boggler
Tue Apr 08, 2014 4:30 pm
 
Forum: Investing - Theory, News & General
Topic: If trading is a losing game, how do you explain prop firms?
Replies: 38
Views: 2946

Re: Was frugality a mistake? The downsides of saving too mu

I have zero regrets about not spending more....I'm convinced that more new cars, more travel and a bigger house would not have made me even 1% more happy. Key statement. And it's important to point out that frugal people get as excited by saving as spenders get from buying a new pair of shoes. So, ...
by boggler
Sun Mar 16, 2014 11:13 am
 
Forum: Personal Consumer Issues
Topic: Was frugality a mistake? The downsides of saving too much.
Replies: 115
Views: 8814

Re: Was frugality a mistake? The downsides of saving too mu

I am 54. I've been a high earner for 30 years and always saved more than half my income. But lived well on the other (post tax) half. But not as well as I could have. I have zero regrets about not spending more....I'm convinced that more new cars, more travel and a bigger house would not have made ...
by boggler
Sat Mar 15, 2014 8:50 pm
 
Forum: Personal Consumer Issues
Topic: Was frugality a mistake? The downsides of saving too much.
Replies: 115
Views: 8814

Re: Vanguard Personal Advisor Services

So, has anyone tried this service?
by boggler
Wed Mar 12, 2014 12:16 pm
 
Forum: Investing - Theory, News & General
Topic: Vanguard Personal Advisor Services
Replies: 26
Views: 4118

Deducting margin interest from taxes

For example, you can deduct the interest on a margin loan you use to purchase stock. But if you use the margin loan to buy a car, you can't deduct the interest (even though such a loan might still make sense in the right circumstances, given the convenience, low rates and flexible repayment options...
by boggler
Wed Mar 12, 2014 12:40 am
 
Forum: Investing - Theory, News & General
Topic: Deducting margin interest from taxes
Replies: 1
Views: 213

Re: Buy vs rent no longer relevant?

What if you buy a house in cash? How do you do the comparison in this case? Buying a house outright in cash is an unlevered decision, so there is no need to factor in the tax deductions or the cost of the interest. The return from the house is the capital appreciation/depreciation added to the valu...
by boggler
Tue Mar 11, 2014 7:45 pm
 
Forum: Personal Finance (Not Investing)
Topic: Buy vs rent no longer relevant?
Replies: 60
Views: 5852

Dividend yield investing

Came across this post online: I've been investing in dividend growth stocks since 12/31/86 and have achieved an average annual return of 15.244%. The companies I own, pipelines and utilities have just 60% of the volatility of the market or 40% less risk. My account, as of 12/31/2013 is up just a lit...
by boggler
Tue Mar 11, 2014 11:34 am
 
Forum: Investing - Theory, News & General
Topic: Dividend yield investing
Replies: 3
Views: 504

Re: Buy vs rent no longer relevant?

Caduceus wrote:The idea that "renting is throwing away money" is just misinformation. You can rent the place or you can rent the money (mortgage interest does not contribute to equity).


What if you buy a house in cash? How do you do the comparison in this case?
by boggler
Tue Mar 11, 2014 11:25 am
 
Forum: Personal Finance (Not Investing)
Topic: Buy vs rent no longer relevant?
Replies: 60
Views: 5852

Re: High expense ratios, risk, and market efficiency

Take real estate as another example. Many posts on this forum have discussed the fact that the majority of risk-adjusted investment return in real estate comes from the actual property management work, and that therefore it doesn't make sense to invest in real estate if you have to pay a lot for pr...
by boggler
Thu Mar 06, 2014 10:12 pm
 
Forum: Investing - Theory, News & General
Topic: High expense ratios, risk, and market efficiency
Replies: 5
Views: 318

Re: High Umbrella Limits - A waste

To Call_Me's point, I can still be sued for $50 million. From my research umbrella up to $5m is relatively easy to obtain and inexpensive. Beyond that gets much more difficult. We all draw the line somewhere. OK - glad you are admitting that your guideline is arbitrary. I tend to like 2X unprotecte...
by boggler
Thu Mar 06, 2014 6:37 pm
 
Forum: Personal Finance (Not Investing)
Topic: High Umbrella Limits - A waste
Replies: 77
Views: 6571

Re: High Umbrella Limits - A waste

There have been many threads about umbrella insurance over the years and they've never ended in agreement about how much is enough. The internet also does not have a clear recommendation. The bottom line is we can each theoretically be sued for any amount of money, so no matter how much you buy you...
by boggler
Thu Mar 06, 2014 6:36 pm
 
Forum: Personal Finance (Not Investing)
Topic: High Umbrella Limits - A waste
Replies: 77
Views: 6571

High expense ratios, risk, and market efficiency

The investment market functions in such a way that investors will only take additional risk if they "expect" to be compensated for it. For example, you invest in stocks vs. bonds because stocks have a higher expected return, but you also recognize that stocks are riskier. A common argument...
by boggler
Thu Mar 06, 2014 12:11 am
 
Forum: Investing - Theory, News & General
Topic: High expense ratios, risk, and market efficiency
Replies: 5
Views: 318

Do billionaires need umbrella insurance?

[See my post below. --admin LadyGeek] Do billionaires need umbrella insurance? On one hand, if you are the target of a liability claim, you presumably have more than enough assets to cover any reasonable claim. On the other hand, you have such a massive fortune at stake that someone might go after ...
by boggler
Tue Mar 04, 2014 7:37 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do billionaires need umbrella insurance?
Replies: 16
Views: 1845

Re: Personal experience of Wealthfront, Betterment....?

I have tried Betterment, Wealthfront, and WiseBanyan. I had to invite 10 people to get off of the WiseBanyan waitlist. It took a day to get my invite (and I had to tweet at them) but now I'm set up. Here are my thoughts on the three. The process was easy to fund all three - EFT transfer into your a...
by boggler
Tue Mar 04, 2014 3:39 pm
 
Forum: Investing - Theory, News & General
Topic: Personal experience of Wealthfront, Betterment....?
Replies: 22
Views: 2921

Re: Has anyone seen the Japanese Stock Market?

This is a great example of a negative rebalancing bonus, too. You would have been continuously throwing good money after bad.
by boggler
Fri Feb 28, 2014 2:37 pm
 
Forum: Investing - Theory, News & General
Topic: Has anyone seen the Japanese Stock Market?
Replies: 73
Views: 6269

Re: Public companies buying index funds

Let's try to avoid the sarcasm and provide the poster with an honest, well-reasoned response.
by boggler
Fri Feb 28, 2014 5:03 am
 
Forum: Investing - Theory, News & General
Topic: Public companies buying index funds
Replies: 14
Views: 1340

Re: Personal experience of Wealthfront, Betterment....?

Happy Wealthfront customer here. Low fees with a lot of added value: automatic rebalancing and TLH (over 100k), great low-cost funds, a Silicon Valley viewpoint on investing (and NOT a Wall Street one.) Are you worried that if Wealthfront gets sold or acquired, you'll be left holding the bag with a...
by boggler
Thu Feb 27, 2014 12:43 pm
 
Forum: Investing - Theory, News & General
Topic: Personal experience of Wealthfront, Betterment....?
Replies: 22
Views: 2921

Re: Has anyone seen the Japanese Stock Market?

Valuethinker, I have been investing for a long time. I am very aware of long bear markets as we had one in the US Stock Market from about 2000-2012. I am painfully aware that things can go wrong. I have actually posted about the secular bear market in the US several times. My belief is that the sec...
by boggler
Thu Feb 27, 2014 1:28 am
 
Forum: Investing - Theory, News & General
Topic: Has anyone seen the Japanese Stock Market?
Replies: 73
Views: 6269

Re: Has anyone seen the Japanese Stock Market?

Could all markets go down for extended periods of time? Absolutely. Now one has to ask how much cash and bonds would hold up if the entire world's capital markets hit a 20+ yr. funk. I, personally, doubt it. I have to say I agree with this. If I'm not planning to sell (even if a depressed market la...
by boggler
Tue Feb 25, 2014 8:30 pm
 
Forum: Investing - Theory, News & General
Topic: Has anyone seen the Japanese Stock Market?
Replies: 73
Views: 6269

Re: Betterment portfolio optimization

I also had to laugh at the chart in the section titled "The Results." It's a chart of expected returns. Not actual returns since Betterment started this portfolio optimization stuff. Not actual returns of the asset classes presently used going back x years. Expected returns. With no expla...
by boggler
Mon Feb 24, 2014 2:43 pm
 
Forum: Investing - Theory, News & General
Topic: Betterment portfolio optimization
Replies: 65
Views: 4224

Betterment portfolio optimization

Betterment just posted an argument on their site in favor of their portfolio optimization strategy. Does anyone here think it has any merit?

https://www.betterment.com/blog/2014/02 ... imization/
by boggler
Mon Feb 24, 2014 1:54 pm
 
Forum: Investing - Theory, News & General
Topic: Betterment portfolio optimization
Replies: 65
Views: 4224

A new argument on Roth vs. traditional?

Came across this online - curious to know what Bogleheads think of this argument:

https://blog.wealthfront.com/roth-401k- ... onal-401k/
by boggler
Mon Feb 24, 2014 5:33 am
 
Forum: Investing - Theory, News & General
Topic: A new argument on Roth vs. traditional?
Replies: 1
Views: 399

Re: Has anyone seen the Japanese Stock Market?

Wow. This gets to be pretty scary stuff. We have been taught that stocks give you a real return of six to seven percent a year over long periods of time. The charts show that this ain't necessarily so. Hmmm. When one realizes that the baby boom is now retiring and that the US is no longer experienc...
by boggler
Sun Feb 23, 2014 5:32 pm
 
Forum: Investing - Theory, News & General
Topic: Has anyone seen the Japanese Stock Market?
Replies: 73
Views: 6269

Flipping houses

Is this the real estate equivalent of market timing or day trading? Under what conditions is buying houses, fixing them up, and trying to sell them actually a good idea?
by boggler
Wed Feb 19, 2014 2:04 am
 
Forum: Investing - Theory, News & General
Topic: Flipping houses
Replies: 12
Views: 1397

Re: Rental properties - Risk-adjusted return seems way too h

Here's a good summary of real estate investing: [url]http://economics.mit.edu/files/5887 Discounting leverage, commercial buildings that traded over a 100 year period in Manhattan merely kept pace with inflation - on average . In actuality, while the sample on average closely tracked inflation, ind...
by boggler
Tue Feb 18, 2014 12:04 am
 
Forum: Investing - Theory, News & General
Topic: Rental properties - Risk-adjusted return seems way too high
Replies: 37
Views: 2456

Rental properties - Risk-adjusted return seems way too high

Ignoring transaction costs (which can be significant), one of the biggest advantages of investing in real estate vs. in stocks is that you can use cheap leverage to enhance your returns substantially. However, given the generally low volatility of real estate and the high volatility of stocks, in or...
by boggler
Mon Feb 17, 2014 4:57 am
 
Forum: Investing - Theory, News & General
Topic: Rental properties - Risk-adjusted return seems way too high
Replies: 37
Views: 2456

Re: Hedge funds and private equity in a Boglehead portfolio

What's next? Lottery tickets in a Bogleheads portfolio? Adding assets with a negative expected return is normally de-worsification, even if there are theoretical efficiency gains. PE and HFs don't have negative expected returns, but after fees you are unlikely to beat their equivalent public market...
by boggler
Tue Feb 11, 2014 4:45 am
 
Forum: Investing - Theory, News & General
Topic: Hedge funds and private equity in a Boglehead portfolio
Replies: 11
Views: 916

Re: Using leverage to enhance returns

I looked into this. What ended up being a deal breaker for me was that if you invest on margin with IB, they have the right to loan out securities in your portfolio. This wouldn't be a problem, except that if they are loaned out when a qualified dividend is paid, you'll be taxed at ordinary income r...
by boggler
Sun Feb 09, 2014 4:23 pm
 
Forum: Investing - Theory, News & General
Topic: Using leverage to enhance returns
Replies: 25
Views: 1714

Hedge funds and private equity in a Boglehead portfolio

I may be chased out of the room for saying this, but I do believe that, theoretically, hedge funds and private equity have a place in a Boglehead portfolio since they can significantly improve diversification. Of course, I also strongly believe that costs have to be low for such a strategy to make s...
by boggler
Sun Feb 09, 2014 4:19 pm
 
Forum: Investing - Theory, News & General
Topic: Hedge funds and private equity in a Boglehead portfolio
Replies: 11
Views: 916

Met a guy at an HFT firm - keeps all his money in cash!?

About a week ago, I was talking to a very nice, intelligent guy at an HFT firm and I asked him what he does with his personal money. He said he keeps it all in cash. Honestly, I was pretty surprised to hear this, so I asked him why. His basic argument was that he makes so much money from his HFT bus...
by boggler
Fri Feb 07, 2014 2:57 am
 
Forum: Investing - Theory, News & General
Topic: Met a guy at an HFT firm - keeps all his money in cash!?
Replies: 26
Views: 2744

Re: 100% stock vs 95% stock

I suggest anyone even considering a 95/5 portfolio to put on their big boy pants and go 100/0. :mrgreen: Although I really don't see much of a reason for people to go outside 20/80 to 80/20. One is just too risk adverse (and doesn't make sense with respect to the efficient frontier) while really hi...
by boggler
Mon Feb 03, 2014 4:39 pm
 
Forum: Investing - Theory, News & General
Topic: 100% stock vs 95% stock
Replies: 36
Views: 2632

Endowment investing - picking the best managers

From http://openmedia.yale.edu/projects/iphone/departments/econ/econ252_11/transcript06.html There's one other aspect of security selection that's important, an aspect other than the fact that it's a negative-sum game [that's] very tough for practitioners to win. And that has to do with the degree o...
by boggler
Sun Feb 02, 2014 4:46 pm
 
Forum: Investing - Theory, News & General
Topic: Endowment investing - picking the best managers
Replies: 0
Views: 181

100% stock vs 95% stock

Which allocation has a higher return over the long run? 100% stock or 95% stock with 5% bonds and rebalancing? Without any rebalancing, the 100% stock has a higher expected return, but with rebalancing, it seems like you would be able to take advantage of times when people buy high and sell low, and...
by boggler
Sat Feb 01, 2014 3:13 pm
 
Forum: Investing - Theory, News & General
Topic: 100% stock vs 95% stock
Replies: 36
Views: 2632

Re: Why do billionaires use active managers? Any that don't?

Billionaires are very willing and able to take risk. You don't become a billionaire by playing it safe. Plus billionaires might have access to insider information (or at least early opportunities) that you and I don't have. I don't necessarily agree with this: - Most billionaires I've heard of don'...
by boggler
Fri Jan 31, 2014 10:59 pm
 
Forum: Investing - Theory, News & General
Topic: Why do billionaires use active managers? Any that don't?
Replies: 28
Views: 3375

Why do billionaires use active managers? Any that don't?

If you happen to be both smart and a billionaire (most of which are quite smart, anyway), you are likely more capable than the average person of realizing the value of indexing. However, the few billionaires I've heard of invest using active managers, and also invests in private equity funds, ventur...
by boggler
Fri Jan 31, 2014 10:45 pm
 
Forum: Investing - Theory, News & General
Topic: Why do billionaires use active managers? Any that don't?
Replies: 28
Views: 3375

Placing a trade while the market is closed

Is there any way to place a trade while the market is closed and ensure I'll get a fair price once the market does open? How would I do this? Place a "good till canceled" market order, and just leave it alone until the next day? Alternatively, are there any services that will place trades ...
by boggler
Fri Jan 31, 2014 8:39 pm
 
Forum: Investing - Theory, News & General
Topic: Placing a trade while the market is closed
Replies: 19
Views: 1522

Option selling vs. buy-and-hold

I read somewhere that "studies have shown that put selling outperforms buy-and-hold". I know of more than a few people who believe in indexing generally, but prefer to do so by selling puts and calls on index ETFs like SPY. Are there any reputable, Boglehead-style analyses of this strategy...
by boggler
Wed Jan 29, 2014 4:51 pm
 
Forum: Investing - Theory, News & General
Topic: Option selling vs. buy-and-hold
Replies: 14
Views: 1163

Re: Why Correlation Doesn’t Matter Much

One nice thing about being 100% stock (100% VT) is that you don't need to worry about ANY of this.
by boggler
Wed Jan 29, 2014 2:45 pm
 
Forum: Investing - Theory, News & General
Topic: Why Correlation Doesn’t Matter Much
Replies: 48
Views: 3807

Re: If trading is a losing game, how do you explain prop fir

Why do the big banks engage in trading, given that they are run by smart people who presumably know all this? Because banks hire all these smart people to gain the market advantage. It doesn't have to be related to any illegal or immoral practices (as some may suggest), it can be that large banks s...
by boggler
Fri Jan 24, 2014 9:55 pm
 
Forum: Investing - Theory, News & General
Topic: If trading is a losing game, how do you explain prop firms?
Replies: 38
Views: 2946

Re: If trading is a losing game, how do you explain prop fir

Why do the big banks engage in trading, given that they are run by smart people who presumably know all this?
by boggler
Fri Jan 24, 2014 8:40 pm
 
Forum: Investing - Theory, News & General
Topic: If trading is a losing game, how do you explain prop firms?
Replies: 38
Views: 2946

If trading is a losing game, how do you explain prop firms?

The common wisdom here is that indexing is the best strategy over time. Thus, trading stocks back and forth repeatedly, perhaps at high-frequency, is likely to underperform the market over time. Many Wall Street firms recognize this, but continue to trade because they are investing other people's mo...
by boggler
Fri Jan 24, 2014 7:40 pm
 
Forum: Investing - Theory, News & General
Topic: If trading is a losing game, how do you explain prop firms?
Replies: 38
Views: 2946
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