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Re: 3-to-1 Odds Favor Index Investors (SPIVA)

Thanks for bringing that report to our attention Rick. I wonder what the percentage of "outperformance" would have to be for it to make sense for someone to choose active over index? For instance, if 60% of actively managed funds consistently outperformed benchmark, would it make sense to ...
by bschultheis
Mon Mar 24, 2014 6:00 pm
 
Forum: Investing - Theory, News & General
Topic: 3-to-1 Odds Favor Index Investors (SPIVA)
Replies: 15
Views: 1702

Re: Planning first trip to Oregon and Seattle - advice sough

I am reiterating what several have said, but my two cents. . . Take ferry to Winslow, Bainbridge Island, for lunch or dinner. I have done this hundreds of times, and still love it. Definitely do this over a Mariners game, unless of course, they are in first place, and then Safe will be sold out and ...
by bschultheis
Wed Mar 05, 2014 3:54 am
 
Forum: Personal Consumer Issues
Topic: Planning first trip to Oregon and Seattle - advice sought!
Replies: 40
Views: 1669

Re: How much is a fair hourly fee?

You might think I am quoting $10,000 an hour in jest. I am not. This is the quote I would give someone who asked me for hourly advice. No one would pay it, which is why I don't ask it. If I were to charge someone $333 an hour for 3 hours of work, that would be about $1,000. If the only impact I coul...
by bschultheis
Tue Mar 04, 2014 1:27 am
 
Forum: Investing - Theory, News & General
Topic: How much is a fair hourly fee?
Replies: 86
Views: 4832

Re: How much is a fair hourly fee?

$10,000 an hour.

Three assumptions . . .

Investor has $2 million dollar portfolio

Investor is an "average" investor of normal intelligence

Investor assures me they will follow my advice that I share in this one-hour meeting over the next 20 years

;-)
by bschultheis
Tue Mar 04, 2014 1:17 am
 
Forum: Investing - Theory, News & General
Topic: How much is a fair hourly fee?
Replies: 86
Views: 4832

Re: madsinger monthly report (December 2013)

Thanks Brad

Go Coffeehouse!

(and remember to stay on top of that personal inflation rate.) :D
by bschultheis
Fri Jan 03, 2014 5:40 pm
 
Forum: Investing - Theory, News & General
Topic: madsinger monthly report (December 2013)
Replies: 12
Views: 1517

Re: Simplicity vs. Complexity.

Bogleheads: As I approach 90 , I can offer some insight into "Safe Withdrawal Rates." Mathematicians love numbers. Fortunately for them, the stock and bond markets spew-out millions of numbers every day which are carefully preserved and available for them to analyze. Unfortunately, past p...
by bschultheis
Tue Nov 19, 2013 9:10 am
 
Forum: Investing - Theory, News & General
Topic: Beware of Financial Planning’s Misguided Rules-of-Thumb
Replies: 51
Views: 5054

Re: Smart beta equals factor tilts

Those who aren't smart enough to have a credible opinion on the matter. - Me :D IlliniDave, How about rephrasing that to say, "Those who are smart enough not to care or have an opinion on the matter." For what its worth, while debating smart and dumb beta and what causes them might be fun...
by bschultheis
Tue Oct 22, 2013 2:41 am
 
Forum: Investing - Theory, News & General
Topic: Smart beta equals factor tilts
Replies: 93
Views: 4470

Re: madsinger monthly report (July 2013)

Thanks Brad.

Go Coffeehouse!

Bill
by bschultheis
Mon Aug 05, 2013 10:50 pm
 
Forum: Investing - Theory, News & General
Topic: madsinger monthly report (July 2013)
Replies: 7
Views: 637

Re: My personal rate of inflation is ....................

I love it when someone besides me brings up the topic of "Personal Inflation Rate," because I am tempted to bring it up every other day on this forum to stress its importance, but then I would become a nuisance. As a financial advisor who sits down with several clients a day, day after day...
by bschultheis
Sun May 05, 2013 11:14 pm
 
Forum: Personal Finance (Not Investing)
Topic: My personal rate of inflation is ....................
Replies: 36
Views: 2937

Death knell of Coffeehouse Investor

In today's section (yesterday on east coast) the Wall Street Journal ran two different articles in the same C section on the demise of a 60/40 Coffeehouse-type portfolio. "New Recipe For Returns In Risk Era" http://online.wsj.com/article/SB10001424127887323551004578438410252327372.html?KEY...
by bschultheis
Wed Apr 24, 2013 12:43 am
 
Forum: Investing - Theory, News & General
Topic: Death knell of Coffeehouse Investor
Replies: 30
Views: 5149

Re: Seattle: author reading by Bill Bernstein April 22

Great idea. Can anyone play jazz piano?

Looking forward to connecting at 6 and meeting everyone.

Bill
by bschultheis
Tue Apr 16, 2013 1:11 am
 
Forum: Local Chapters and Bogleheads Community
Topic: Seattle: author reading by Bill Bernstein April 22
Replies: 22
Views: 1907

Re: Seattle: author reading by Bill Bernstein April 22

That sounds like a great idea. I'd love to hear Bill.

Let's find a coffeehouse nearby and connect an hour/90 minutes before the reading?

Let me know if you are interested, see how many might attend.

Bill
by bschultheis
Sat Apr 13, 2013 12:03 pm
 
Forum: Local Chapters and Bogleheads Community
Topic: Seattle: author reading by Bill Bernstein April 22
Replies: 22
Views: 1907

Re: Swedroe versus Ferri on Recommended Asset Classes

Trying to hedge equity risk with commodities sure sounds good, it just doesn't work good. The correlation argument for commodities is week and unreliable. How soon people forget that commodity funds crashed harder than stock funds during the depths of the financial crisis. That's not portfolio insu...
by bschultheis
Sun Mar 24, 2013 10:09 am
 
Forum: Investing - Theory, News & General
Topic: Swedroe versus Ferri on Recommended Asset Classes
Replies: 127
Views: 24101

What's An Investor to Do?

. . . weight a portfolio heavily toward TIPS, as suggested (implied?) by James Stewart, in his NYT column today titled 'Conceived By Students, a Portfolio That Pays" or avoid TIPS, as suggested by Brett Arends in his WSJ column today titled, "Looking for Inflation Protection? Take TIPS Off...
by bschultheis
Sat Feb 02, 2013 3:10 am
 
Forum: Investing - Theory, News & General
Topic: What's An Investor to Do?
Replies: 12
Views: 3104

Re: ETFs have a Birthday

Taylor Larimore wrote:Very few people know more about ETFs than Boglehead, Rick Ferri, who wrote The ETF Book. These are "Investment Gems" from his book:


On top of that, Rick could not be more generous with his time in sharing his knowledge of ETFs with investors and advisors alike. Thanks Rick!
by bschultheis
Fri Jan 18, 2013 3:33 am
 
Forum: Investing - Theory, News & General
Topic: ETFs have a Birthday
Replies: 6
Views: 735

Did you release your Personal CPI?

Today the U.S. Bureau of Labor Statistics released the Consumer Price Index, reporting an increase of 1.7% for 2012. For me, that number is largely irrelevant. The big question is, how much did my personal CPI increase? It boils down to the choices I make in my everyday life and how I spend my money...
by bschultheis
Wed Jan 16, 2013 2:09 pm
 
Forum: Investing - Theory, News & General
Topic: Did you release your Personal CPI?
Replies: 20
Views: 1248

Re: madsinger monthly report (December 2012)

Thanks Brad, and all the best to you in 2013.

Go Coffeehouse!

Bill
by bschultheis
Thu Jan 03, 2013 1:12 am
 
Forum: Investing - Theory, News & General
Topic: madsinger monthly report (December 2012)
Replies: 9
Views: 1395

Re: Active managers fail again, S&P Scorecard results

While S&P scorecard details the difficulty of active management to best a benchmark, IMO that is not the compelling reason to build a passive (indexing) portfolio. What matters most of all is that an indexed portfolio allows you to stay the course with confidence. The big issue for investors, co...
by bschultheis
Thu Jan 03, 2013 12:14 am
 
Forum: Investing - Theory, News & General
Topic: Active managers fail again, S&P Scorecard results
Replies: 9
Views: 1511

Re: What's the secret [to successful investing]?

Note that not one person has mentioned getting 3% cash back rather than 2% cash back or having an asset allocation of 65% stocks rather 60% stocks or having an online account paying 1.0% rather than one paying 0.75% or having a mortgage at 3.25% rather than 3.40% or any of the myriad of other items...
by bschultheis
Sun Nov 18, 2012 3:54 pm
 
Forum: Investing - Theory, News & General
Topic: What's the secret [to successful investing]?
Replies: 57
Views: 3841

Re: What's the secret [to successful investing]?

Back in 1999, in the midst of one of the greatest bull markets in the history of the stock market, I encouraged investors to turn away from the market and focus on three simple principles that they already knew to be true, likely shared with them by a parent, grandparent, wise friend. . . 1. Don't p...
by bschultheis
Sun Nov 18, 2012 3:47 pm
 
Forum: Investing - Theory, News & General
Topic: What's the secret [to successful investing]?
Replies: 57
Views: 3841

Interview with Bill McNabb / Vanguard

http://seattletimes.com/html/businesste ... eoxml.html

Good interview with Bill McNabb in today's paper. My apologies if it has already been posted.

I like the way Vanguard focuses on "the little guy."

Bill
by bschultheis
Mon Oct 15, 2012 12:34 pm
 
Forum: Investing - Theory, News & General
Topic: Interview with Bill McNabb / Vanguard
Replies: 1
Views: 291

Re: Indexes Beat Active Funds Again in S&P Study

That is a great point Rick, one that is frequently overlooked by the folks who are proponents of actively managed funds, especially brokers and financial advisors.

Nice feature in Zweig's WSJ article today! Way to go. . .

Bill
by bschultheis
Sat Oct 13, 2012 2:58 pm
 
Forum: Investing - Theory, News & General
Topic: Indexes Beat Active Funds Again in S&P Study
Replies: 15
Views: 1812

Re: Indexes Beat Active Funds Again in S&P Study

Thanks Taylor. Great points on benefits of indexing, and I'm with you. Even if over 50% of actively managed funds outperformed a benchmark, it wouldn't change my approach either. By owning a benchmark, I put the pursuit of performance in perspective, which allows me to focus 100% of my attention on ...
by bschultheis
Sat Oct 13, 2012 2:48 pm
 
Forum: Investing - Theory, News & General
Topic: Indexes Beat Active Funds Again in S&P Study
Replies: 15
Views: 1812

Re: Indexes Beat Active Funds Again in S&P Study

Let's say, for the sake of discussion, that actively managed, large blend mutual funds consistently outperformed the S&P 500 index. Let's assume, for instance, on 1, 3, 5 and 10 year periods, 52% of actively managed funds consistently beat the benchmark, and collectively, the funds that beat the...
by bschultheis
Sat Oct 13, 2012 1:37 pm
 
Forum: Investing - Theory, News & General
Topic: Indexes Beat Active Funds Again in S&P Study
Replies: 15
Views: 1812

Re: Challenge to the Fama French Three Factor Model

The folks who are reading and posting in this discussion have been in the indexing church for many, many years. Rick Ferri Rick, while I agreet with you that posters on this thread might have a grasp on this topic, and understand that, while interesting, isn't all that important, I can't agree with...
by bschultheis
Sun Oct 07, 2012 8:29 pm
 
Forum: Investing - Theory, News & General
Topic: Challenge to the Fama French Three Factor Model
Replies: 57
Views: 5009

Re: Challenge to the Fama French Three Factor Model

Maybe there should be a way to categorize posts based on who they are for; beginner, intermediate, advanced, and PhD level. This would be a PhD conversation. Rick Ferri In making my original post, I am not critical of discussing this as a topic, and in fact I find this stuff interesting myself. I h...
by bschultheis
Sun Oct 07, 2012 10:41 am
 
Forum: Investing - Theory, News & General
Topic: Challenge to the Fama French Three Factor Model
Replies: 57
Views: 5009

Re: Challenge to the Fama French Three Factor Model

PS. Bill, many people on this forum are interested in furthering their education and understanding, even "sophisticated" investors. I agree with you Rick, this stuff can be interesting, and as I mentioned in my post, this is a good place to discuss it. I also appreciate your comment that ...
by bschultheis
Sun Oct 07, 2012 12:08 am
 
Forum: Investing - Theory, News & General
Topic: Challenge to the Fama French Three Factor Model
Replies: 57
Views: 5009

Re: Challenge to the Fama French Three Factor Model

(To the new investors: This is an advanced investing topic and can be safely ignored.) Thanks for including this statement LadyGeek. I would only add that, in my opinion it can be ingored not only by new investors, but by investors who are successful investors, have been around the block a few time...
by bschultheis
Sat Oct 06, 2012 3:17 pm
 
Forum: Investing - Theory, News & General
Topic: Challenge to the Fama French Three Factor Model
Replies: 57
Views: 5009

Re: What #s to Set Inflation Rate and Rate of return for Pla

1.) Plan Inflation Rate - I am currently using 3% 2.) Rate of Investment Return - I am currently using 4% Those are reasonable numbers, but keep in mind that a plan's inflation rate is not some arbitrary number cooked up by gov't statistics, it is the rate at which YOUR cost of living, or burn rate...
by bschultheis
Thu Sep 27, 2012 9:24 am
 
Forum: Investing - Theory, News & General
Topic: What #s to Set Inflation Rate and Rate of return for Plan..
Replies: 25
Views: 952

Re: Perspective: Multi-Factor vs Total Market choices

existential coolness (I hear he climbed the west face of K2 last weekend), Wow, I wish my wife, mom, clients, dog etc., etc., thought I was existentially cool - though I don't really know what that means. And I heard the same K2 rumor, but alas, not true. I was simply scaling a ladder on my chimney...
by bschultheis
Thu Sep 20, 2012 5:17 pm
 
Forum: Investing - Theory, News & General
Topic: Perspective: Multi-Factor vs Total Market choices
Replies: 38
Views: 2065

Re: Perspective: Multi-Factor vs Total Market choices

A lot of time is spent worrying about basis point differences in expose ratios and not percentage point differences due to bad behavior. JL, A great reflection - people can quibble all they want about whether the DALBAR research is meaningful and representative, but in my humble opinion based on my...
by bschultheis
Thu Sep 20, 2012 2:29 pm
 
Forum: Investing - Theory, News & General
Topic: Perspective: Multi-Factor vs Total Market choices
Replies: 38
Views: 2065

Re: Perspective: Multi-Factor vs Total Market choices

Every once in a while someone makes a post on this forum that is simply over-the-top outstanding. The OP is one such post. I suggest we frame it and hang it on the Boglehead forum introductory page for everyone to read. The author eloquently put down in words what many of us think when we read the m...
by bschultheis
Thu Sep 20, 2012 12:22 pm
 
Forum: Investing - Theory, News & General
Topic: Perspective: Multi-Factor vs Total Market choices
Replies: 38
Views: 2065

Re: How to start a startup

Here is my formula for a startup. . . 1. Have a great idea. 2. Be obsessed about it. 3. Work 18 hour days (seriously). 4. Risk your own money, not VC - increases your chance of success because intuitively you will work harder. 5. Go through a period called "startup" where you aren't making...
by bschultheis
Fri Sep 14, 2012 6:21 pm
 
Forum: Personal Consumer Issues
Topic: How to start a startup
Replies: 16
Views: 1289

Re: Your Favorite [Travel Destination] on Earth: Where and

14,000 ft on Denali. Away from "everything"

Backstreets of Rome.

San Juan islands
by bschultheis
Sat Sep 01, 2012 6:16 pm
 
Forum: Personal Consumer Issues
Topic: Your Favorite [Travel Destination] on Earth: Where and Why?
Replies: 94
Views: 8314

Re: IPAD question

Does anyone have suggestions on simple word processor that is password protected?

Thanks!
by bschultheis
Sat Sep 01, 2012 6:06 pm
 
Forum: Personal Consumer Issues
Topic: IPAD question
Replies: 27
Views: 2099

Re: Risky and Getting Riskier

fallible. . . I am heading out on the road shortly for a few days, but will respond to this next Tuesday and Wednesday. I have some thoughts and suggestions that have worked for me over the years, and would enjoy brainstorming with you. We all need to be BOLD! In regards to others' comments re. adve...
by bschultheis
Sat Sep 01, 2012 3:42 pm
 
Forum: Investing - Theory, News & General
Topic: Risky and Getting Riskier [hedge fund advertising]
Replies: 13
Views: 2528

Re: Risky and Getting Riskier

As for boldness, I agree we Bogleheads need to at least try to be as bold as Jack Bogle in spreading the message, but it's quite a challenge and not always easy to know just how to effectively do that. Thanks for your important post. Could you elaborate on "but it's quite a challenge and not a...
by bschultheis
Sat Sep 01, 2012 2:16 pm
 
Forum: Investing - Theory, News & General
Topic: Risky and Getting Riskier [hedge fund advertising]
Replies: 13
Views: 2528

Re: Risky and Getting Riskier

[response to removed OT comment deleted by admin alex] Nisi, very clever - I missed that thread on Thursday - and I am sure the Mary Rose is oversubscribed. Lost out again, story of my life. If it reopens, I'm first in line. Sadly, the way the industry has turned index funds upside down, I'm sure t...
by bschultheis
Sat Sep 01, 2012 1:13 pm
 
Forum: Investing - Theory, News & General
Topic: Risky and Getting Riskier [hedge fund advertising]
Replies: 13
Views: 2528

Re: Risky and Getting Riskier

We are all adults around here . I agree. Nobody who reads this board will fall for this stuff. Unfortunately, 99% :) (IMO) of investors don't read this board. I would suggest that there is a small difference between a Nigerian e mail and slick advertising from the Wall Street crowd. :D I am amazed ...
by bschultheis
Sat Sep 01, 2012 9:31 am
 
Forum: Investing - Theory, News & General
Topic: Risky and Getting Riskier [hedge fund advertising]
Replies: 13
Views: 2528

Risky and Getting Riskier [hedge fund advertising]

Interesting article, to say the least. http://www.nytimes.com/2012/09/01/opinion/risky-and-getting-riskier-for-investors.html?_r=1&hp With returns on fixed income investments so low, and a stock market that produces very erratic short term returns, it is no surprise that more and more investors ...
by bschultheis
Sat Sep 01, 2012 9:13 am
 
Forum: Investing - Theory, News & General
Topic: Risky and Getting Riskier [hedge fund advertising]
Replies: 13
Views: 2528

Re: The Next 10 Years

Thanks Rick, looks like your predictions are about in line with Larry Swedroe's predictions and Jack Bogle's predictions. 1 to 3 percent on bonds and 5 to 7 percent on stocks, or somewhere in that neighborhood. Those are the same predictions we are using out here in Seattle. And while you "gott...
by bschultheis
Thu Aug 30, 2012 11:42 pm
 
Forum: Investing - Theory, News & General
Topic: The Next 10 Years
Replies: 47
Views: 5274

Re: what will stocks earn in the future

Thanks Larry, I understand you are not "predicting" any number, but offering an "expectation" of real returns of 6% for planning purposes. Discussing this might be interesting, but let's keep in mind it has big implications for people's planning and lives. Regardless of whether o...
by bschultheis
Sat Aug 25, 2012 9:31 am
 
Forum: Investing - Theory, News & General
Topic: what will stocks earn in the future
Replies: 57
Views: 5483

Re: what will stocks earn in the future

To clarify . . . (I might have missed it in this thread) Larry is suggesting "real" returns of 6%. ? I am pretty sure Jack Bogle's suggestion is "nominal" returns of 7%. Big difference here, for planning purposes. After all, isn't that the only reason we are discussing this stuff...
by bschultheis
Sat Aug 25, 2012 8:57 am
 
Forum: Investing - Theory, News & General
Topic: what will stocks earn in the future
Replies: 57
Views: 5483

Re: What are the requirements for managing other people's mo

Thanks for the comments, I appreciate it - always a little nervous about promoting on this board the many benefits of a career as an advisor, but you are right, staythecourse, it can be a wonderful career. Every day I wake up and think I am the luckiest person in the world to be in my career. In my ...
by bschultheis
Sun Aug 19, 2012 10:56 am
 
Forum: Investing - Theory, News & General
Topic: What are the requirements for managing other people's money?
Replies: 22
Views: 4859

Re: How important is saving??

staythecourse, thanks so much for bringing that to the attention of this board. I wholeheartedly agree with your sentiments, that the "savings" issue isn't given the importance that it deserves on this forum. Another overwhelmingly important issue that is rarely discussed here is one's per...
by bschultheis
Sun Aug 19, 2012 10:01 am
 
Forum: Investing - Theory, News & General
Topic: How important is saving??
Replies: 53
Views: 4287

Re: What are the requirements for managing other people's mo

I would like to respond to the comments of mlipps and K*ya who expressed interest in becoming an investment advisor. I am sure there are lots of other folks on this forum who are contemplating the same. I get about 3-5 inquiries a month at the Coffeehouse from folks across the nation who contact me,...
by bschultheis
Sat Aug 18, 2012 1:12 pm
 
Forum: Investing - Theory, News & General
Topic: What are the requirements for managing other people's money?
Replies: 22
Views: 4859

Re: Could a state pension fund invest solely in index funds?

Many states index most, if not all of their stock market investments. It would never qualify for authentic data, but when I wrote The Coffeehouse Investor I called many state pension fund directors to inquire, and found that a large number indexed most assets, including state of WA, who indexed the ...
by bschultheis
Sat Aug 18, 2012 12:40 pm
 
Forum: Investing - Theory, News & General
Topic: Could a state pension fund invest solely in index funds?
Replies: 21
Views: 2798

Re: Seattle trip suggestions

Don't go on any "cruises around the sound." Take a ferry to Bainbridge Island, 30 minutes, walk off, go get some ice cream, and take the next ferry back. Cheap and gorgeous veiws of Seattle. Space Needle, but maybe a little pricey. I haven't been on new ferris wheel, but it looks cool. Pik...
by bschultheis
Wed Aug 15, 2012 7:15 pm
 
Forum: Personal Consumer Issues
Topic: Seattle trip suggestions
Replies: 27
Views: 3339

Re: What are the requirements for managing other people's mo

mlipps,

I am tied up for most of the day, but will respond to your post later this evening, and share some comments and thoughts regarding the next steps for you.

Bill
by bschultheis
Mon Aug 13, 2012 12:55 pm
 
Forum: Investing - Theory, News & General
Topic: What are the requirements for managing other people's money?
Replies: 22
Views: 4859
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