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Re: PXSV has changed indexes

Robert T wrote: (i) If you are unsure about factor exposure, then focus on expense i.e. VBR is cheapest (ii) If you want highest size and value loads without regard to alpha (making the assumption that alpha varies randomly around a long-term value of zero – sometimes positive, and sometimes negati...
by garlandwhizzer
Mon Apr 27, 2015 12:13 pm
 
Forum: Investing - Theory, News & General
Topic: PXSV has changed indexes
Replies: 125
Views: 9637

Re: Who's holding cash?

Generally, I hold no cash in tax sheltered accounts, but I always hold cash in my personal account sufficient to provide adequately for my living expenses of 1 - 3 years depending on market conditions. My SS + dividends do not provide adequately for annual expenses and being a total return guy I mus...
by garlandwhizzer
Mon Apr 27, 2015 11:55 am
 
Forum: Investing - Theory, News & General
Topic: Who's holding cash?
Replies: 25
Views: 1318

Re: Vanguard Balanced Index from Cradle to Grave

nisiprius wrote: The thing that's hard for people to accept is that there is a fairly big zoo of portfolios of which it can be said that they are all sane, that there is no way to prove which is best, and even thirty years from now no way to prove whether the highest-returning one was smart or just...
by garlandwhizzer
Mon Apr 27, 2015 11:20 am
 
Forum: Investing - Theory, News & General
Topic: Vanguard Balanced Index from Cradle to Grave
Replies: 33
Views: 2768

Re: What rate of return do you use when planning for retirem

My equity is divided 60%US, 20%DM, 20%EM broken up into 50% LC and 50% SC + MC. I'm estimating total return of that equity portfolio over the next decade at 4% real. I'm estimating US bond returns over the next decade at between 0 and 1% real. Both are well below historical averages, but given the c...
by garlandwhizzer
Wed Apr 22, 2015 11:29 am
 
Forum: Investing - Theory, News & General
Topic: What rate of return do you use when planning for retirement?
Replies: 59
Views: 4479

Re: Warren Buffett on equties, treasuries, and "risk"

I believe Buffett is right. I was 100% in equities all the way until well after I retired but that was because I had a great job that paid very well and great job security. If that's not you, you need an anchor or buffer (bonds, cash) in case of loss of job or emergencies and it is wise to keep more...
by garlandwhizzer
Tue Apr 21, 2015 12:02 pm
 
Forum: Investing - Theory, News & General
Topic: Warren Buffett on equties, treasuries, and "risk"
Replies: 46
Views: 4289

Re: Do index funds (and other mutual funds) have a dark side

EmergDoc wrote: The dark side of mutual funds is that they're putting stockbrokers everywhere out of business. The dark side of index funds is that they're putting mutual fund salesmen everywhere out of business. The dark side of Bogleheads is it's putting financial advisors everywhere out of busin...
by garlandwhizzer
Fri Apr 17, 2015 11:25 am
 
Forum: Investing - Theory, News & General
Topic: Do index funds (and other mutual funds) have a dark side?
Replies: 14
Views: 2098

Re: New Vanguard White Paper: "Factor-based investing" (Apr

Rick Ferri wrote: by Rick Ferri » Thu Apr 16, 2015 3:36 pm I've not seen the paper. There's no free lunch. So-call smart-beta is always more expensive to impliment, there are decades when it doesn't work, and today it has become so popular the odds of it not working in the near future may have incr...
by garlandwhizzer
Fri Apr 17, 2015 11:17 am
 
Forum: Investing - Theory, News & General
Topic: New Vanguard White Paper: "Factor-based investing" (Apr '15)
Replies: 21
Views: 3149

Re: Humorous Investing are Videos are Back Up!

Love them. Thanks, Boglenaut.

Garland Whizzer
by garlandwhizzer
Thu Apr 16, 2015 12:39 pm
 
Forum: Investing - Theory, News & General
Topic: Humorous Investing are Videos are Back Up!
Replies: 8
Views: 1412

Re: RBD in Emerging Markets Brewing

On this widely anticipated RBD for EM Vanguard's Emerging Market's Index Fund Admiral Shares was up 0.50%. Moving assets around pre-emptively based on short term market predictions was counterproductive, however compelling its logic looked beforehand. I suspect the same is true for most day traders ...
by garlandwhizzer
Wed Apr 15, 2015 9:47 pm
 
Forum: Investing - Theory, News & General
Topic: RBD in Emerging Markets Brewing
Replies: 41
Views: 4409

Re: Small cap value vs private equity

I suspect that there aren't good reliable statistics on the past performance of private equity. I don't think that all private equity is required to post their results in a central location. There are for example hedge fund indices but all hedge funds are not required to report. The ones who do repo...
by garlandwhizzer
Wed Apr 15, 2015 9:29 pm
 
Forum: Investing - Theory, News & General
Topic: Small cap value vs private equity
Replies: 3
Views: 523

Re: PXSV has changed indexes

JohnnyFive wrote: They didn't change the index. The index provider (Research Affiliates...RAFI), will no longer be providing this index. That doesn't fully answer the question. It just moves the question upstream by one step. Why then did RAFI abandon an index that many sophisticated factor investor...
by garlandwhizzer
Tue Apr 14, 2015 1:42 pm
 
Forum: Investing - Theory, News & General
Topic: PXSV has changed indexes
Replies: 125
Views: 9637

Re: PXSV has changed indexes

Does anyone know exactly why PXSV management decided to change indexes? It seems to me that those on the Forum who were knowledgeable factor investors believed PXSV's old index to be an excellent choice for SCV exposure. Perhaps it didn't attract a large enough asset base to generate sufficient fees...
by garlandwhizzer
Mon Apr 13, 2015 6:20 pm
 
Forum: Investing - Theory, News & General
Topic: PXSV has changed indexes
Replies: 125
Views: 9637

Re: Ferri on Bloomberg Podcast

Knowledgeable, ethical, and experienced market experts are always worth listening to. This is a case in point.

Garland Whizzer
by garlandwhizzer
Mon Apr 13, 2015 5:55 pm
 
Forum: Investing - Theory, News & General
Topic: Ferri on Bloomberg Podcast
Replies: 5
Views: 1114

Re: Is there Smart Beta in Corporate Bonds?

I think Rick makes a good point and I do believe that the Vanguard High Yield Corporate fund is well positioned on the risk reward tradeoff under some circumstances. Personally, I have a very high equity allocation (70% - 75%) so my modest bond allocation (25% - 30%) should be in safer fixed income ...
by garlandwhizzer
Sat Apr 11, 2015 7:33 pm
 
Forum: Investing - Theory, News & General
Topic: Is there Smart Beta in Corporate Bonds?
Replies: 35
Views: 3212

Re: Mohamed El-Erian Has Most of His Money in Cash

Maynard F Speer wrote: If Swedroe's 'Fat Tails' portfolio can generally stay a nose ahead of a 60:40 portfolio, despite holding effectively 70% cash, I think that says something about the wisdom of holding stable capital preservers through many market conditions Larry's portfolio certainly looks li...
by garlandwhizzer
Wed Apr 08, 2015 1:49 pm
 
Forum: Investing - Theory, News & General
Topic: Mohamed El-Erian Has Most of His Money in Cash
Replies: 69
Views: 7638

Re: Mohamed El-Erian Has Most of His Money in Cash

He's not too excited about cash either but he believes that central bank policy has driven up asset prices of stocks and bonds way beyond their intrinsic values. He fears risk going forward at this point and is taking a defensive position in asset allocation, temporarily accepting a zero return (cas...
by garlandwhizzer
Mon Apr 06, 2015 11:51 am
 
Forum: Investing - Theory, News & General
Topic: Mohamed El-Erian Has Most of His Money in Cash
Replies: 69
Views: 7638

Re: Passive vs Active funding

This article suggests that the outperformance of active over passive increases with time. In the study 10 year active funds relative returns were much better in comparison to passive than at 5 years, and again 5 years was better than 3 years. Vanguard's data shows just the opposite, longer time fram...
by garlandwhizzer
Sun Apr 05, 2015 5:16 pm
 
Forum: Investing - Theory, News & General
Topic: Passive vs Active funding
Replies: 17
Views: 1626

Re: If everyone goes index then who sets the prices?

The threat of everyone going into index funds is imaginary. Currently in spite of the recent popularity of index funds less than half of equity investments are in index funds. Hedge funds, private equity, actively managed funds, financial firms with their buy and sell rating lists, the endless strea...
by garlandwhizzer
Sat Apr 04, 2015 9:05 pm
 
Forum: Investing - Theory, News & General
Topic: If everyone goes index then who sets the prices?
Replies: 7
Views: 926

Re: "Is Morningstar Losing Relevance In An Indexing World?"

Maynard F Speer makes a good point that some of Vanguard's active funds, Berkshire Hathaway, etc., low cost funds with very good active management, may be exceptions to the rule that passive beats active. All rules have some exceptions but a few exceptions doesn't mean that the rule isn't generally ...
by garlandwhizzer
Fri Apr 03, 2015 6:43 pm
 
Forum: Investing - Theory, News & General
Topic: "Is Morningstar Losing Relevance In An Indexing World?"
Replies: 25
Views: 2395

Re: "Is Morningstar Losing Relevance In An Indexing World?"

I do not think the investing world will run out of those who try to beat the market with active management in spite of the considerable evidence that it is largely counterproductive. Recall that Las Vegas casinos make billions annually and have done so for a long period of time. Las Vegas is a more ...
by garlandwhizzer
Fri Apr 03, 2015 1:37 pm
 
Forum: Investing - Theory, News & General
Topic: "Is Morningstar Losing Relevance In An Indexing World?"
Replies: 25
Views: 2395

Re: Have P/E Ratios Affected Your Asset Allocation?

I definitely make modest changes in asset allocation when I believe that valuations warrant it. For example, within the equity portion of my portfolio, I increased INTL relative to US last fall from 30INTL/70US TO 40/60 based partially on valuations and partially on anticipated divergent monetary po...
by garlandwhizzer
Fri Apr 03, 2015 1:15 pm
 
Forum: Investing - Theory, News & General
Topic: Have P/E Ratios Affected Your Asset Allocation?
Replies: 52
Views: 2686

Re: Beating the Street

When I was in the accumulating phase (a long time ago) I never held bonds and was always 100% in stocks, usually high beta stocks. It made me millions in the 1990s and lost me millions in the tech crash. I made more than I lost and, importantly, I learned a hard lesson, one I haven't forgotten since...
by garlandwhizzer
Thu Apr 02, 2015 8:04 pm
 
Forum: Investing - Theory, News & General
Topic: Beating the Street
Replies: 6
Views: 705

Re: If long-term, why not just go really high risk?

If you're absolutely certain that you're not going to touch it for 50 years, I believe that 100% equity is a reasonable choice. The problem is: who can be absolutely certain up front of maintaining that behavior for 50 years? That's a lot of time and a lot of things can happen unexpectedly like seve...
by garlandwhizzer
Thu Apr 02, 2015 7:45 pm
 
Forum: Investing - Theory, News & General
Topic: If long-term, why not just go really high risk?
Replies: 49
Views: 4981

Re: Riddle Me This [Vanguard's bond target so far from Bogle

"Age in bonds" was Bogle's recommendation during the greatest bond bull market of all times, back when bond yields were attractive and produced significant positive inflation adjusted returns. Such is not the case now. I believe Bogle's current portfolio is about 50/50, a far cry from &quo...
by garlandwhizzer
Tue Mar 31, 2015 1:58 pm
 
Forum: Investing - Theory, News & General
Topic: Riddle Me This [Vanguard's bond target so far from Bogle's]
Replies: 10
Views: 1832

Re: Rick Ferri's 30 year market forecast 2015

EarlyStart wrote: Wouldn't the sequence of purchases make a huge difference? This, of course, wouldn't make projections any more or less valid. I'm just wondering how to consider this type of evidence within the context of an accumulating, early investor. Thanks in advance. The most important thing...
by garlandwhizzer
Sat Mar 28, 2015 1:49 pm
 
Forum: Investing - Theory, News & General
Topic: Rick Ferri's 30 year market forecast 2015
Replies: 137
Views: 13900

Rick Ferri's 30 year market forecast 2015

Rick's 30 year forecast for equity, bond, and REIT returns. It is important to read the preamble before looking at the numbers because it emphasizes the difficulty of making market forecasts and their very real limitations. Nonetheless, I think it is helpful in planning to know the future expectatio...
by garlandwhizzer
Fri Mar 27, 2015 11:57 am
 
Forum: Investing - Theory, News & General
Topic: Rick Ferri's 30 year market forecast 2015
Replies: 137
Views: 13900

Re: Wise move to move some $ to cash before bear market?

The historical record suggests that no one can consistently and reliably predict beforehand when a bull market in going to begin or end and likewise for bear markets. If prognosticators make enough picks, someone gets it right occasionally but that is very much like the fact that a broken watch is a...
by garlandwhizzer
Thu Mar 26, 2015 6:29 pm
 
Forum: Investing - Theory, News & General
Topic: Wise move to move some $ to cash before bear market?
Replies: 116
Views: 11854

Re: New all-world SC multi-factor ETF

Will be interesting to watch. The index performed nicely over the past year. It's very easy, however, to set up a multi-factor global index that on 20/20 hindsight outperforms by choosing the right countries to invest in at the right weights, and the right factors in the right factor weights in orde...
by garlandwhizzer
Thu Mar 26, 2015 5:37 pm
 
Forum: Investing - Theory, News & General
Topic: New all-world Small-Cap multi-factor ETF
Replies: 4
Views: 668

Re: Should I invest my emergency fund?

It seems to me that the entire point of an emergency fund is to have a ready source of liquidity at times of severe market weakness or unexpected financial difficulty. Having 130% of the standard emergency allocation in equities does not protect you sufficiently in this regard in my opinion. The who...
by garlandwhizzer
Wed Mar 25, 2015 6:55 pm
 
Forum: Investing - Theory, News & General
Topic: Should I invest my emergency fund?
Replies: 71
Views: 6353

Re: Anyone concerned about their bond holdings?

[quote]nisi wrote: So I conclude two things. a) Interest rates often don't do what experts think they will do. b) When interest rates do do what experts think they will do, the effect may not be what experts said it would be. 1+ I believe nisi has hit this nail right on the head. This logic can be a...
by garlandwhizzer
Tue Mar 24, 2015 7:22 pm
 
Forum: Investing - Theory, News & General
Topic: Anyone concerned about their bond holdings?
Replies: 58
Views: 5923

Re: What Happens When Vanguard Owns Everything?

I tend to be skeptical and a bit paranoid about many, not all, financial advisor's, brokers, and financial firms. This is based on years of experience which was richly rewarding to those who claimed to be helping me, but not so rewarding for me. The book, "Where are the Client's Yachts" di...
by garlandwhizzer
Tue Mar 24, 2015 6:58 pm
 
Forum: Investing - Theory, News & General
Topic: What Happens When Vanguard Owns Everything?
Replies: 19
Views: 4932

Re: VGPMX [Vanguard Precious Metals And Mining Fund]

johnz 1001wrote: I think the fund started in 1984. It's roughly 240 percent above it's starting point 17 years ago. I hope my math is right. If I start with $10,000 in 1998 and the Morningstar chart says it's at about $34,000 now. Don't be shy to correct me, though I already know no one is... Actua...
by garlandwhizzer
Mon Mar 23, 2015 12:33 pm
 
Forum: Investing - Theory, News & General
Topic: VGPMX [Vanguard Precious Metals And Mining Fund]
Replies: 24
Views: 2492

Re: "Small-Cap Indexing: Popularity Can Be a Pain"

Great post, Taylor. Brings up some good points. To tilt or not to tilt and, if so, by how much is a personal decision but having more information on these questions is helpful to all of us who consider it. I'm a valuation guy and I don't believe that SC today offer the same valuation advantage relat...
by garlandwhizzer
Mon Mar 23, 2015 11:54 am
 
Forum: Investing - Theory, News & General
Topic: "Small-Cap Indexing: Popularity Can Be a Pain"
Replies: 14
Views: 2186

Re: The Most Likely Portfolio Peril — Inflation or Deflation

nedsaid wrote: Garland, we did get a benefit from the increased government debt in that it helped reflate the real estate and financial markets. In essence, it was a swap of government debt for private debt. I believe that debt is money. The write-off of subprime and other mortgage debt took a lot ...
by garlandwhizzer
Sun Mar 22, 2015 12:39 pm
 
Forum: Investing - Theory, News & General
Topic: The Most Likely Portfolio Peril — Inflation or Deflation?
Replies: 40
Views: 3920

Re: VGPMX [Vanguard Precious Metals And Mining Fund]

madbrain wrote: Sorry, but the current share price is only 78.75% below it's all time-high. What you meant is that the all time high was 470% of the current price. Sorry about my poor math. It had been a long day when I wrote that. Thanks for the correction. The point remains that VGPMX has tanked b...
by garlandwhizzer
Sun Mar 22, 2015 12:16 pm
 
Forum: Investing - Theory, News & General
Topic: VGPMX [Vanguard Precious Metals And Mining Fund]
Replies: 24
Views: 2492

VGPMX [Vanguard Precious Metals And Mining Fund]

Gold and Precious Metals Mining companies are historically among the most poorly managed corporations in the world. In addition they invest in an arena that has a zero expected long term real return and one whose volatility is off the scale. Deflation in much of the developed world, severe recession...
by garlandwhizzer
Sat Mar 21, 2015 3:03 pm
 
Forum: Investing - Theory, News & General
Topic: VGPMX [Vanguard Precious Metals And Mining Fund]
Replies: 24
Views: 2492

Re: The Most Likely Portfolio Peril — Inflation or Deflation

Great thought provoking post, Simplegift. Also enjoyed nedsaid's comments about debt. Debt levels including mortgage debt, other personal debt, and governmental debt have provided tailwinds for developed economies for decades. That engine is running out of steam. The problem is that debt used to giv...
by garlandwhizzer
Sat Mar 21, 2015 2:20 pm
 
Forum: Investing - Theory, News & General
Topic: The Most Likely Portfolio Peril — Inflation or Deflation?
Replies: 40
Views: 3920

Re: PXSV has changed indexes

Robert T wrote: . FWIW: 10-yr returns (%) to end-February 2015 JKL = 9.41 VBR = 8.84 IJS = 8.49 DFSVX = 8.10 IWN = 6.99 Russell Fundamental US Small Company Index = 11.70 http://www.russell.com/indexes/americas ... ?ic=D41448 No one disputes that indexes such as the Russell Fundamental US Small Com...
by garlandwhizzer
Wed Mar 18, 2015 6:49 pm
 
Forum: Investing - Theory, News & General
Topic: PXSV has changed indexes
Replies: 125
Views: 9637

Re: This Fund Manager Has Consistently Beaten the S&P 500

The Nicholas Fund is a large/mid cap growth fund with low turnover, a very similar approach to Primecap funds like the Capital Opportunty Fund. Both have outperformed not only the S&P 500 (which is an unfair comparison since it is a large cap blend fund) but also the Vanguard Growth Index Fund w...
by garlandwhizzer
Wed Mar 18, 2015 6:04 pm
 
Forum: Investing - Theory, News & General
Topic: This Fund Manager Has Consistently Beaten the S&P 500
Replies: 18
Views: 2878

Re: VWO vs China/India stock markets

Currency dynamics may have something to do with it. The dollar is appreciating against all other currencies at the moment except perhaps the Swiss franc. Some countries may show considerable market appreciation in their local currencies but translated back into dollars (VWO) the appreciation in a we...
by garlandwhizzer
Tue Mar 17, 2015 1:17 pm
 
Forum: Investing - Theory, News & General
Topic: VWO vs China/India stock markets
Replies: 1
Views: 327

Re: Is MicroCap on sale?

Given the underperformance of micro caps are we to conclude that the small premium has been not only absent but also negative for the last 10 years?

Garland Whizzer
by garlandwhizzer
Tue Mar 17, 2015 1:08 pm
 
Forum: Investing - Theory, News & General
Topic: Is MicroCap on sale?
Replies: 11
Views: 1434

Re: Philosophical Economics: Introducing the Total Return EP

Simplegift wrote: But Mr. Livermore loses me when also assumes mean reversion of CAPE — as if this were a natural occurrence and there is some "normal" level of price/earnings at which stocks are destined to trade. I realize that in this current piece he is critiquing a market prediction ...
by garlandwhizzer
Tue Mar 17, 2015 1:04 pm
 
Forum: Investing - Theory, News & General
Topic: Philosophical Economics: Introducing the Total Return EPS
Replies: 16
Views: 1924

Re: Shiller - How Scary Is the Bond Market?

I do not believe there is going to be a crash in the bond market. Our interest rates are the highest in the world given our very low level of risk. Europe and Japan offer much lower rates at similar risk profiles and investors in those developed nations are buying US bonds, effectively putting a cei...
by garlandwhizzer
Tue Mar 17, 2015 12:57 pm
 
Forum: Investing - Theory, News & General
Topic: Shiller - How Scary Is the Bond Market?
Replies: 29
Views: 4490

Re: Retired - When to Sell to Generate Cash

lifesoft wrote: I would sell my bond fund shares in a bear market to buy those equities. As long as I am selling bond funds, I might as well sell some for living expenses, too. Or are you saying that you are 100% equities except for your cash buffer? All my bonds (25% - 30% of portfolio) are in my ...
by garlandwhizzer
Mon Mar 16, 2015 3:18 pm
 
Forum: Investing - Theory, News & General
Topic: Retired - When to Sell to Generate Cash
Replies: 30
Views: 2023

Re: PXSV has changed indexes

Confession: having argued on this forum that I am skeptical of real fund's ability to capture the SCV and other factor premiums going forward, I actually continue hold some SCV myself, changing from one SCV fund to another from time to time as frustration mounts. I do this in spite of the fact that ...
by garlandwhizzer
Mon Mar 16, 2015 12:27 pm
 
Forum: Investing - Theory, News & General
Topic: PXSV has changed indexes
Replies: 125
Views: 9637

Re: Retired - When to Sell to Generate Cash

I have been retired for 17 years and I subscribe to the idea of a cash buffer to avoid having to sell equities into a bear market. In my opinion no simple rule will be perfect in all situations. The 3 year rule is a conservative one that will likely keep you out of trouble but it comes at the price ...
by garlandwhizzer
Mon Mar 16, 2015 12:09 pm
 
Forum: Investing - Theory, News & General
Topic: Retired - When to Sell to Generate Cash
Replies: 30
Views: 2023

Re: "Picking Winners?"

nedsaid wrote:Hiring stock pickers doesn't help too much or even hiring stock picker pickers. This is why I index more and more. The greatest share of my investments with new money since 1999 have been into index funds. My experience exactly. My equity exposure used to be 100% in individual stocks,...
by garlandwhizzer
Mon Mar 16, 2015 11:47 am
 
Forum: Investing - Theory, News & General
Topic: "Picking Winners?"
Replies: 5
Views: 554

Re: Bernstein: 2% investment returns over next 20 years

Clearly_Irrational wrote with respect to his returns on rental property: Non leveraged returns should be somewhere around 6% while a normal amount of leverage (30% down, 70% borrowed) should return around 15% or so. (for a 40yr holding period, adjust higher or lower depending if your holding period...
by garlandwhizzer
Sun Mar 15, 2015 2:14 pm
 
Forum: Investing - Theory, News & General
Topic: Bernstein: 2% investment returns over next 20 years
Replies: 216
Views: 23601

Re: How much international is too much?

How much international is too much? More than you personally are comfortable with but in no case to exceed international cap weight in global indexes.

Garland Whizzer
by garlandwhizzer
Sun Mar 15, 2015 2:03 pm
 
Forum: Investing - Theory, News & General
Topic: How much international is too much?
Replies: 113
Views: 9509
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