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Re: Randomly-weighted stock portfolios beat the index

It is scary to me how dogmatic this forum is. All of the initial responses immediately shoot down this essay on the basis of arguments that are explicitly addressed and refuted within the essay. Does anyone here who has actually read the essay, have a rigorous rebuttal? Would love to hear grabiner's...
by johnanglemen
Mon Sep 15, 2014 9:46 am
 
Forum: Investing - Theory, News & General
Topic: Randomly-weighted stock portfolios beat the index
Replies: 28
Views: 2108

Re: Vanguard Developed Markets Index Fund

If they have called the new fund the "Tax-managed Int'l fund", but managed it exactly the same way they intend to manage it, no one would have been the wiser. And I think the previous Tax-managed Int'l Fund was not managed any differently for the past 7 years. livesoft, after precisely a ...
by johnanglemen
Tue Jul 01, 2014 4:39 am
 
Forum: Investing - Theory, News & General
Topic: Vanguard Developed Markets Index Fund
Replies: 10
Views: 1294

Re: Selling high ER investments -- doing the right thing?

Also, $2400 of the gain is in Western Digital Corp (WDC) stock rather than a fund. I agree that that's about diversification rather than ER. $2400 is about 1% of his overall portfolio, so perhaps it would make sense to hold onto that one and sell the rest?
by johnanglemen
Fri May 23, 2014 10:37 am
 
Forum: Investing - Help with Personal Investments
Topic: Selling high ER investments -- doing the right thing?
Replies: 7
Views: 1005

Re: Selling high ER investments -- doing the right thing?

Thank you. Yes, it's a taxable account. All of the $8,000 in gains is long-term.
by johnanglemen
Fri May 23, 2014 10:34 am
 
Forum: Investing - Help with Personal Investments
Topic: Selling high ER investments -- doing the right thing?
Replies: 7
Views: 1005

Estimated taxes on capital gains later offset by losses

Let's say I realize a capital gain of $1M on January 1st. Then, 364 days later, on December 31st, I realize a capital loss of $1M.

So, no net tax owed for the year. However, was I still supposed to pay estimated tax on the $1M each quarter? Will I owe penalties for not doing so?
by johnanglemen
Mon Apr 14, 2014 9:59 pm
 
Forum: Investing - Help with Personal Investments
Topic: Estimated taxes on capital gains later offset by losses
Replies: 7
Views: 697

Prerefunded munis: exempt from state tax?

I live in California, which has the following rule concerning muni bonds: "For California tax purposes, a mutual fund may qualify to pay tax-exempt interest dividends if, at the end of each quarter, at least 50% of the funds' assets are invested in federal or California state or local obligatio...
by johnanglemen
Thu Mar 20, 2014 10:44 pm
 
Forum: Investing - Help with Personal Investments
Topic: Prerefunded munis: exempt from state tax?
Replies: 3
Views: 435

Re: Why did Vanguard High-Yield Bond Underperform So Badly?

^ Are you asking me to do more work for you to satisfy your question in the OP? The annuity is nothing but the Vanguard HY Bond fund in disguise. Yes, 352 Bonds vs. 366 Bonds, but do you really think that Michael L. Hong, CFA, Vice President, Wellington Management Company, LLP has a completely sepa...
by johnanglemen
Sun Jan 12, 2014 10:22 pm
 
Forum: Investing - Theory, News & General
Topic: Why did Vanguard High-Yield Bond Underperform So Badly?
Replies: 12
Views: 2753

Re: Why did Vanguard High-Yield Bond Underperform So Badly?

If you would like to know what a fund "returns" you might try the fund's distribution page @ VG. https://personal.vanguard.com/us/funds/snapshot?FundId=0529&FundIntExt=INT#tab=4 No, that's not precisely the same fund as the annuity subaccount I linked to. Yes, it is. https://personal....
by johnanglemen
Sat Jan 11, 2014 10:19 am
 
Forum: Investing - Theory, News & General
Topic: Why did Vanguard High-Yield Bond Underperform So Badly?
Replies: 12
Views: 2753

What am I missing when it comes to leverage?

Say I have $50 million. (This mostly works for smaller amounts too; picking a large number to demonstrate the point.) Interactive Brokers will lend me $5 million today at a blended margin interest rate of 0.652%. The interest on this is tax-deductible. PenFed will offer me a 5-year CD at 3%. The int...
by johnanglemen
Sat Jan 11, 2014 10:15 am
 
Forum: Investing - Theory, News & General
Topic: What am I missing when it comes to leverage?
Replies: 8
Views: 777

Re: No dividend for bond fund purchased on record date

I purchased before 4PM on the 31st. You did and you didn't. You placed an order before 4PM on the 31st. The purchase price was unknown at the time, so you couldn't have paid for your shares. If you didn't pay before 4PM, then you didn't own the shares before 4PM. But the conclusion in this thread (...
by johnanglemen
Tue Jan 07, 2014 8:38 am
 
Forum: Investing - Help with Personal Investments
Topic: No dividend for bond fund purchased on record date
Replies: 13
Views: 788

Re: No dividend for bond fund purchased on record date

If you purchased on 12/31, then you did not own it for a day since the purchase goes through that evening, right? Think about it another way, suppose you exchanged out on 12/31, would you expect to get the dividend through 12/31 since you owned those shares all that day? Not sure what you mean. I'm...
by johnanglemen
Tue Jan 07, 2014 8:37 am
 
Forum: Investing - Help with Personal Investments
Topic: No dividend for bond fund purchased on record date
Replies: 13
Views: 788

Re: No dividend for bond fund purchased on record date

I purchased before 4PM on the 31st. The trade date on the transaction is the 31st.
by johnanglemen
Tue Jan 07, 2014 8:33 am
 
Forum: Investing - Help with Personal Investments
Topic: No dividend for bond fund purchased on record date
Replies: 13
Views: 788

No dividend for bond fund purchased on record date

I purchased Vanguard California Muni (VCADX) on 12/31, its record date. I did not receive any distribution from it. Could someone explain-like-I'm-five what happened here exactly? I guess I might have expected one day's worth of interest since I was a shareholder of record on the 31st.
by johnanglemen
Tue Jan 07, 2014 8:14 am
 
Forum: Investing - Help with Personal Investments
Topic: No dividend for bond fund purchased on record date
Replies: 13
Views: 788

Re: Why did Vanguard High-Yield Bond Underperform So Badly?

If you would like to know what a fund "returns" you might try the fund's distribution page @ VG. https://personal.vanguard.com/us/funds/snapshot?FundId=0529&FundIntExt=INT#tab=4 That page would show you the fund has been retuning, or distributing monthly, in the 5.8% to 5.9% range, no...
by johnanglemen
Sun Jan 05, 2014 6:12 pm
 
Forum: Investing - Theory, News & General
Topic: Why did Vanguard High-Yield Bond Underperform So Badly?
Replies: 12
Views: 2753

Why did Vanguard High-Yield Bond Underperform So Badly?

The average high-yield bond fund returned around 7% in 2013. Could someone help me understand why Vanguard's High Yield Bond Variable Annuity returned only 4%: https://personal.vanguard.com/us/funds/snapshot?FundId=0146&FundIntExt=INT Its own benchmark, Barclays US Corp High Yield Index, returne...
by johnanglemen
Sun Jan 05, 2014 6:16 am
 
Forum: Investing - Theory, News & General
Topic: Why did Vanguard High-Yield Bond Underperform So Badly?
Replies: 12
Views: 2753

Re: How do bond dividends work?

I can only tell you about Vanguard. Regular bond funds at vanguard accrue interest daily to you. That interest does not show up in the NAV. When you sell some of your shares but keep some, the interest on the sold shares is paid to you at the end of the month when the interest on your held shares i...
by johnanglemen
Mon Dec 23, 2013 5:43 pm
 
Forum: Investing - Help with Personal Investments
Topic: How do bond dividends work?
Replies: 14
Views: 1306

How do bond dividends work?

Say I hold Vanguard Intermediate Tax-Exempt Bond Fund and it has a distribution record date of 12/31/13. I used to think that I would only receive this distribution if I held shares of the fund on this date. However, someone said recently that "Vanguard bond funds are different" -- that I ...
by johnanglemen
Mon Dec 23, 2013 3:25 pm
 
Forum: Investing - Help with Personal Investments
Topic: How do bond dividends work?
Replies: 14
Views: 1306

Re: New HSA Bank fees

Upon doing some research, it seems to me that Bancorp is the new fee winner. It has no fees so long as you keep only $1000 (rather than almost $5000, as with HSA Bank) in cash, and that cash earns an APY that is 3x higher than HSA Bank. Beyond that, you can buy Fidelity Spartan funds for just $5.99 ...
by johnanglemen
Wed Sep 18, 2013 4:22 am
 
Forum: Personal Finance (Not Investing)
Topic: New HSA Bank fees
Replies: 9
Views: 1101

Re: New HSA Bank fees

...and this amount increases yet again to $4,925 on January 1, 2014.

Also, this affects even people who have been contributing to HSAs for years, since you now must keep almost $2,000 more in your (low-interest-bearing) bank account rather than investing it.
by johnanglemen
Wed Sep 18, 2013 3:51 am
 
Forum: Personal Finance (Not Investing)
Topic: New HSA Bank fees
Replies: 9
Views: 1101

New HSA Bank fees

I received the following email. Note that the minimum account balance required to avoid fees has increased to $4850. This is quite irritating as this is my first year contributing to an HSA, so I'm legally unable to even meet this balance until next year. Is there a better HSA provider out there tha...
by johnanglemen
Wed Sep 18, 2013 3:47 am
 
Forum: Personal Finance (Not Investing)
Topic: New HSA Bank fees
Replies: 9
Views: 1101

Re: Munis vs taxable bonds

Thanks grabiner. I've always valued your opinion highly; would you mind weighing in with a specific recommendation given the facts of this decision?
by johnanglemen
Fri Sep 06, 2013 11:27 pm
 
Forum: Investing - Theory, News & General
Topic: Munis vs taxable bonds
Replies: 16
Views: 1520

Re: Munis vs taxable bonds

baw703916 wrote:I do own Vanguard High Yield tax-exempt--but only because "high yield has a completely different meaning in the case of that fund.


Can you clarify what you mean by this, since I'm in fact talking about the (taxable) Vanguard High-Yield fund here?
by johnanglemen
Fri Sep 06, 2013 2:33 pm
 
Forum: Investing - Theory, News & General
Topic: Munis vs taxable bonds
Replies: 16
Views: 1520

Re: Munis vs taxable bonds

(I should also note that Total Bond Market has an ER of 0.20% when held in the VA, versus 0.10% normally. However, all Vanguard subaccounts are slightly higher cost, e.g. Vanguard high yield bond annuity subaccount has an ER of 0.29% rather than the usual 0.23%.)
by johnanglemen
Fri Sep 06, 2013 2:30 pm
 
Forum: Investing - Theory, News & General
Topic: Munis vs taxable bonds
Replies: 16
Views: 1520

Re: Munis vs taxable bonds

To be clear, the decision isn't between bonds or stocks in my tax-sheltered account. My small tax-sheltered accounts are already maxed out on bonds. The situation is that I have a certain amount of money in an extremely low cost (flat fee, actually) variable annuity at Jefferson National. Right now,...
by johnanglemen
Fri Sep 06, 2013 2:02 pm
 
Forum: Investing - Theory, News & General
Topic: Munis vs taxable bonds
Replies: 16
Views: 1520

Re: Munis vs taxable bonds

Fair enough. Say the comparison is Vanguard Total Bond Market Admiral vs Vanguard California Intermediate-Term Admiral. Time horizon is 40 years. Highest federal + state (CA) tax.
by johnanglemen
Fri Sep 06, 2013 2:57 am
 
Forum: Investing - Theory, News & General
Topic: Munis vs taxable bonds
Replies: 16
Views: 1520

Munis vs taxable bonds

Is there any point in holding taxable bonds in tax-sheltered accounts rather than munis in taxable accounts if you are 100% sure that you will be in the highest tax bracket at withdrawal time?
by johnanglemen
Fri Sep 06, 2013 12:16 am
 
Forum: Investing - Theory, News & General
Topic: Munis vs taxable bonds
Replies: 16
Views: 1520

Re: Does a variable annuity make sense for me?

Yes, a variable annuity is worth it in your case. And you'll likely want to use Jefferson National's flat-fee annuity rather than Vanguard's. The fee will most likely be smaller depending on how much you're investing. Wow - this is a fascinating product. It's so low-cost that I'm wondering why more...
by johnanglemen
Tue Jul 16, 2013 12:41 am
 
Forum: Investing - Theory, News & General
Topic: Does a variable annuity make sense for me?
Replies: 20
Views: 1297

Re: Does a variable annuity make sense for me?

Yes, a variable annuity is worth it in your case. And you'll likely want to use Jefferson National's flat-fee annuity rather than Vanguard's. The fee will most likely be smaller depending on how much you're investing.
by johnanglemen
Mon Jul 15, 2013 8:09 pm
 
Forum: Investing - Theory, News & General
Topic: Does a variable annuity make sense for me?
Replies: 20
Views: 1297

Re: Good day to tax-loss harvest munis?

I guess these investments are not quite equivalent since the ETF has a longer duration than the mutual fund. The discount on the ETF today though is still quite shocking.
by johnanglemen
Mon Jun 24, 2013 1:22 pm
 
Forum: Investing - Help with Personal Investments
Topic: Good day to tax-loss harvest munis?
Replies: 1
Views: 218

Good day to tax-loss harvest munis?

I've been meaning to tax loss harvest a loss in Vanguard California Intermediate Muni (VCADX). I note that the SPDR Cali Muni ETF (CXA) is down a whopping 4.3% today even though its IIV is only down about 0.5%....... Aside from the horrible questions this raises in my mind about market efficiency, w...
by johnanglemen
Mon Jun 24, 2013 1:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: Good day to tax-loss harvest munis?
Replies: 1
Views: 218

Re: Is it okay for me to sell now?

avalpert wrote:It is too late to sell and not receive the dividend - for dividend purposes owners as of the ex-dividend day (today) will receive the dividend.


But the page just says it was "declared" today. That's different, no?
by johnanglemen
Fri Jun 21, 2013 12:03 am
 
Forum: Investing - Help with Personal Investments
Topic: Is it okay for me to sell now?
Replies: 6
Views: 1263

Is it okay for me to sell now?

Say I bought VSS 30 days ago and now I want to tax loss harvest it. I see from Vanguard's dividend site (https://personal.vanguard.com/us/insights/article/june-dividends-062013) that VSS has declared a dividend as of today that will be in part qualified. If I sell today, will I still end up getting ...
by johnanglemen
Thu Jun 20, 2013 1:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: Is it okay for me to sell now?
Replies: 6
Views: 1263

Re: Taxable or tax-exempt bonds?

But I'm still going to be taxed on the taxable bond when I withdraw from the annuity eventually...
by johnanglemen
Wed Jun 19, 2013 12:26 pm
 
Forum: Investing - Help with Personal Investments
Topic: Taxable or tax-exempt bonds?
Replies: 5
Views: 409

Re: Taxable or tax-exempt bonds?

I don't understand how to reconcile your two answers? Say I expect to be in a 39.6 bracket forever. If that's the case, why should I expect taxable funds in tax-advantaged accounts to beat tax-exempt funds?
by johnanglemen
Wed Jun 19, 2013 11:23 am
 
Forum: Investing - Help with Personal Investments
Topic: Taxable or tax-exempt bonds?
Replies: 5
Views: 409

Taxable or tax-exempt bonds?

I currently hold nearly all of my bonds in a California muni bond fund, but I've decided I'd like to diversify this risk into something more stable. I have no more 'normal' tax-free or tax-deferred space (401K/IRA). I am in the highest federal and state tax brackets (39.6%, 13.3%) and have a time ho...
by johnanglemen
Wed Jun 19, 2013 4:30 am
 
Forum: Investing - Help with Personal Investments
Topic: Taxable or tax-exempt bonds?
Replies: 5
Views: 409

Re: Spot-checking your CPA on taxes

Any other thoughts here? What sort of mistakes have people made on their own taxes?
by johnanglemen
Tue May 28, 2013 1:42 am
 
Forum: Personal Finance (Not Investing)
Topic: Spot-checking your CPA on taxes
Replies: 9
Views: 1200

Re: New low cost variable annuities worth a look?

You'll have to work out the estimates depending on what bonds you would be holding, on whether JeffNat offers the fund you want, and on your tax rate in retirement. The current yield on Long-Term Tax-Exempt is 2.28%, which corresponds to 3.04% for a corporate fund of comparable risk. That would be ...
by johnanglemen
Sun May 26, 2013 4:19 pm
 
Forum: Investing - Theory, News & General
Topic: New low cost variable annuities worth a look?
Replies: 20
Views: 1731

Re: New low cost variable annuities worth a look?

Is this just a hypothetical example to illustrate the potential? JeffNat offers Vanguard Total Bond Market, and the pretax yield on that is actually lower than the aftertax yield of, say, Vanguard California Muni! I can see how holding a bond portfolio in JeffNat might make sense when rates rise, b...
by johnanglemen
Sun May 26, 2013 3:17 pm
 
Forum: Investing - Theory, News & General
Topic: New low cost variable annuities worth a look?
Replies: 20
Views: 1731

Re: New low cost variable annuities worth a look?

Even for conventional bonds, the annuity makes sense for a large investment, because of the benefit of tax deferral. Suppose that you are in a 25% tax bracket and invest $500K for 30 years in a bond fund which earns 4%. In a taxable account, you would earn 3% annually (and using munis of comparable...
by johnanglemen
Sun May 26, 2013 2:54 pm
 
Forum: Investing - Theory, News & General
Topic: New low cost variable annuities worth a look?
Replies: 20
Views: 1731

Spot-checking your CPA on taxes

I believe I have a very good CPA, but I would nonetheless like to 'spot check' my tax returns each year. What are some lesser known points that would be good to verify? For instance, verifying that foreign tax credit was claimed.
by johnanglemen
Fri May 24, 2013 6:38 pm
 
Forum: Personal Finance (Not Investing)
Topic: Spot-checking your CPA on taxes
Replies: 9
Views: 1200

What's the right thing to do in this situation?

Say I have two liabilities: - a tax bill, which will be due at the end of the year. - a mortgage, which is due over the course of many (> 5) years. I have enough money to pay off both the tax bill and the mortgage immediately if I wanted, but if possible, I'd like to invest the funds instead for hig...
by johnanglemen
Tue Apr 23, 2013 6:36 pm
 
Forum: Investing - Help with Personal Investments
Topic: What's the right thing to do in this situation?
Replies: 5
Views: 979

Paying taxes past your credit limit

The IRS offers a payment provider, PayUSAtax.com, that charges 1.89% to process CC tax payments. There are a number of cards that pay larger rewards than this. If you have a tax payment that is much larger than your CC limit, does anyone know if it's possible to break it up into multiple payments? I...
by johnanglemen
Mon Apr 08, 2013 7:15 pm
 
Forum: Personal Finance (Not Investing)
Topic: Paying taxes past your credit limit
Replies: 12
Views: 1027

What denominator is used to calculate dividend yield?

I invest $10,000 in Total Stock Market on January 1. By December 31, it has thankfully appreciated to $20,000. The fund typically yields an annual dividend of 2%. Should I be expecting 2% of $10K, $20K, or something in between depending on the fund's value throughout the year?
by johnanglemen
Sun Apr 07, 2013 6:22 pm
 
Forum: Investing - Help with Personal Investments
Topic: What denominator is used to calculate dividend yield?
Replies: 3
Views: 380

How to determine what % of a Q1 dividend was qualified?

OK, so a bunch of funds just paid out dividends for Q1. Now how do I tell what % of these specific dividends were qualified (not the fund's general average)? I thought this would be rather simple information to obtain, but I can't find it anywhere.
by johnanglemen
Fri Apr 05, 2013 1:54 am
 
Forum: Investing - Help with Personal Investments
Topic: How to determine what % of a Q1 dividend was qualified?
Replies: 2
Views: 230

Re: First time tax loss harvest questions

Thanks. Not an April Fools joke. I thought about adding to my tax-managed international position in the interim, but it seems somewhat illogical because the fund isn't really correlated with emerging markets (e.g. YTD, VEMIX is +4% while VWO is -3.7%). Why exactly wouldn't you just go to IEMG? Is it...
by johnanglemen
Mon Apr 01, 2013 11:41 am
 
Forum: Investing - Theory, News & General
Topic: First time tax loss harvest questions
Replies: 7
Views: 658

First time tax loss harvest questions

I have a loss of $130K in Vanguard Emerging Markets Institutional (VEMIX) that represents a 2.5% decline. I am considering harvesting this loss and purchasing iShares Core MSCI Emerging Markets ETF (IEMG) as a substitute to remain in the market. A few questions: 1. Does it make sense to harvest this...
by johnanglemen
Mon Apr 01, 2013 1:45 am
 
Forum: Investing - Theory, News & General
Topic: First time tax loss harvest questions
Replies: 7
Views: 658

Best wash sale replacement for Vanguard Emerging Markets?

Does anyone know of a suitable low-cost wash-sale replacement for Vanguard Emerging Markets Admiral fund? I prefer a mutual fund but would settle for an ETF. The lowest cost option that tracks a different index seems to be iShares Emerging Markets (IEMG). Would others agree with that? Is the bid/ask...
by johnanglemen
Sun Mar 31, 2013 11:17 pm
 
Forum: Investing - Help with Personal Investments
Topic: Best wash sale replacement for Vanguard Emerging Markets?
Replies: 1
Views: 321

Re: Why doesn't this fund have an SEC Yield?

Can someone help me understand why this fund has neither an SEC Yield nor a Distribution Yield listed? https://personal.vanguard.com/us/funds/snapshot?FundId=0127&FundIntExt=INT#tab=4 Did you read through the Wiki? Link - http://www.bogleheads.org/wiki/Vanguard_Tax_Managed_International_Fund_Ta...
by johnanglemen
Tue Mar 26, 2013 12:55 pm
 
Forum: Investing - Help with Personal Investments
Topic: Why doesn't this fund have an SEC Yield?
Replies: 10
Views: 806
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