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Re: More XIRR Questions

XIRR gives you the annualized rate of return. In the case of a period that is less than one year, as would be for YTD calculations, you need to adjust the XIRR output. It's relatively painless though: YTD = (1 + @XIRR)^(#days/365.25), where #days is the number of days thus far in the year and 365.25...
by k66
Sun Mar 29, 2015 12:39 pm
 
Forum: Investing - Theory, News & General
Topic: More XIRR Questions
Replies: 17
Views: 1232

Re: How many of you invest in individual stocks?

I hold one individual stock with a near-guaranteed ROR of 50%. I hold it in my company's employee share ownership plan (e.g. I get a 1/2 share for every one I purchase up to 4% gross). Also, once per year, I sell as many shares as I am able to without violating the minimum holding period (else I wou...
by k66
Sun Mar 29, 2015 9:58 am
 
Forum: Investing - Theory, News & General
Topic: How many of you invest in individual stocks?
Replies: 41
Views: 1936

Re: Retirement calculation lies?

Don't forget also the relationship between Arithmetic mean, m(a), and geometric mean, m(g), is related by the standard deviation, s, (fluctuation in period returns): m(g) = m(a) - s^2 / 2 When s is zero (no variation, or constant return) then they are equal. That relationship is only true if the PD...
by k66
Sat Mar 28, 2015 3:10 am
 
Forum: Investing - Theory, News & General
Topic: Retirement calculation lies? [Geometric vs. arithmetic mean]
Replies: 44
Views: 3913

Re: Retirement calculation lies?

Don't forget also the relationship between Arithmetic mean, m(a), and geometric mean, m(g), is related by the standard deviation, s, (fluctuation in period returns):

m(g) = m(a) - s^2 / 2

When s is zero (no variation, or constant return) then they are equal.
by k66
Fri Mar 27, 2015 8:54 pm
 
Forum: Investing - Theory, News & General
Topic: Retirement calculation lies? [Geometric vs. arithmetic mean]
Replies: 44
Views: 3913

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

Riptide--I started my BH-style investing almost exactly 5 years ago (April 2010). Almost the day after I switched my portfolio to index-based investments, the market blew out the better part of 20% (SP500 from 1220 down to 1020). It really made me think twice about what I had done and if I wasn't go...
by k66
Thu Mar 26, 2015 8:46 pm
 
Forum: Investing - Theory, News & General
Topic: Wise move to move some $ to cash before bear market?
Replies: 66
Views: 5763

Reduced Spending thru Retirement? Models or Data

Has anyone seen or read studies or data related to the potential for reduced spending in retirement? A retiree's progressive spending is perhaps generally determined by (a) decreasing spending needs (e.g. older retirees not able or wanting to spend as much as younger retirees) and (b) potential incr...
by k66
Sat Mar 21, 2015 10:13 am
 
Forum: Personal Finance (Not Investing)
Topic: Reduced Spending thru Retirement? Models or Data
Replies: 6
Views: 715

Re: 25 years old, 100k cash to invest, need help/advice

Welcome to the board Norcal25 and congratulations for having a good financial position at this stage in your life. My first comment might be to not be too assured that your position and/or the industry that you are in is that safe. I'm not saying they are not; just bear in mind that sometimes we dec...
by k66
Thu Mar 19, 2015 9:09 am
 
Forum: Investing - Help with Personal Investments
Topic: 25 years old, 100k cash to invest, need help/advice
Replies: 12
Views: 1093

Re: Five most important things to be a successful investor?

These four "basic tenets" are taken directly from my IPS: Earning returns will require exposure to risk (accept volatility), Compounding returns will contribute significantly over time (stay invested), Follow the Investment Plan (impulsive actions are destructive), and Keep plans as simple...
by k66
Wed Mar 18, 2015 8:45 am
 
Forum: Investing - Theory, News & General
Topic: Five most important things to be a successful investor?
Replies: 31
Views: 3183

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

I think we all pretty much agree that Dr. B is an extremely knowledgable author and provider of advice. But to what extent are his predictions perhaps controlled by some basic concern for professional liability? For example, other professional advise-givers are very much aware how their advice needs...
by k66
Sat Mar 14, 2015 12:36 pm
 
Forum: Investing - Theory, News & General
Topic: Bernstein: 2% investment returns over next 20 years
Replies: 216
Views: 22897

Re: U.S. stocks in freefall

I'm not trying to time the market but I bought some ETFs (ITOT through Fidelity) about a for several months now and i'm not seeing any progress. It seems that the market is unstable that I should wait before making any further investments. I don't think Thoughts? Are any of you holding off expectin...
by k66
Fri Mar 13, 2015 11:18 am
 
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 1225
Views: 229799

Re: Anyone hold precious metal

Absolutely none. Simplicity is one of the four key tenets of my IPS.
by k66
Sat Mar 07, 2015 10:07 am
 
Forum: Investing - Theory, News & General
Topic: Anyone hold precious metal
Replies: 44
Views: 3345

Re: 3 Costs Investors Must Control

... au contraire. The energy with which went into daily analysis of TSP share prices was breathtaking. They are still at it over here: http://www.tsptalk.com/comments.php I was an active reader back in the dot com bubble days of the late 90s and there was considerable anguish amongst some in the TS...
by k66
Thu Mar 05, 2015 2:51 pm
 
Forum: Investing - Theory, News & General
Topic: 3 Costs Investors Must Control
Replies: 61
Views: 5262

Re: Recovering Your Investment after a Loss

@palarry: Congratulations on your recovery, and you are absolutely right in that there will be curve-balls in life which are both difficult to predict and recover from if not properly prepared. @pkcrafter: A permanent loss could conceivably occur in one of two ways. The first, as you noted, is to pa...
by k66
Mon Mar 02, 2015 9:55 am
 
Forum: Investing - Theory, News & General
Topic: Recovering Your Investment after a Loss
Replies: 12
Views: 1346

Re: Does More Indexing Mean Less Stock Trading?

http://i.imgur.com/vOjA6hx.jpg Source: Wells Fargo Yes interesting chart. I also wonder what the trading landscape was like pre2000. It seems as if the S&P500 is only now returning to earlier levels despite present-day HFT activity. Did the en masse day-trading movement of the late 90s really e...
by k66
Sun Mar 01, 2015 10:32 am
 
Forum: Investing - Theory, News & General
Topic: Does More Indexing Mean Less Stock Trading?
Replies: 8
Views: 754

Re: Truths About Stop Losses

Ha! Seems every time i put in a stop loss order.. the stock drops just enough to trigger the sale, then heads back up again... always wonder if the computers can do that on purpose.. or it's just my bad luck.. I have head that anyone with higher level data/quote service can in fact see where stops ...
by k66
Sun Mar 01, 2015 9:58 am
 
Forum: Investing - Theory, News & General
Topic: Truths About Stop Losses
Replies: 14
Views: 1447

Re: Recovering Your Investment after a Loss

Did you mean that you had $140,000 left after your $60k (30%) loss from $200k?

Also bear in mind that the math you noted is reflective of a permanent loss. Although there are no guarantees, a broadly diversified portfolio would not be subject to permanent losses (hopefully!).
by k66
Sun Mar 01, 2015 9:46 am
 
Forum: Investing - Theory, News & General
Topic: Recovering Your Investment after a Loss
Replies: 12
Views: 1346

Re: Buy and Hold Forever Stocks

Why bother picking? Most will not make the grade:

viewtopic.php?f=10&t=159022
by k66
Mon Feb 23, 2015 7:49 pm
 
Forum: Investing - Theory, News & General
Topic: Buy and Hold Forever Stocks
Replies: 101
Views: 8182

Re: The 8x retirement savings rule

Are they saying 8X net or gross income?
by k66
Wed Feb 18, 2015 9:56 pm
 
Forum: Investing - Theory, News & General
Topic: The 8x retirement savings rule
Replies: 83
Views: 8074

Re: Bogleheads 2015 Hedge Fund Contest

Wow--this is unusual, I am beating the index! But then again, so are a number of others.
by k66
Wed Feb 18, 2015 9:50 pm
 
Forum: Investing - Theory, News & General
Topic: Bogleheads 2015 Hedge Fund Contest
Replies: 139
Views: 13264

Re: Grexit !!

Greece hasn't exited that I know of. Let's just chalk this up this to needing some noise on an otherwise quiet market day.
by k66
Mon Feb 16, 2015 1:15 pm
 
Forum: Investing - Theory, News & General
Topic: Grexit ?
Replies: 24
Views: 1806

Re: Hypothetical chance of bond or stock index going to zero

I'm not sure you can really assign a probability to something this ( a major market and thus it's index as well) going extinct. To know the correct likelihood of success or failure of an understood system in the future is built on knowing the history of success or failure of the same system in the p...
by k66
Sat Feb 14, 2015 3:31 pm
 
Forum: Investing - Theory, News & General
Topic: Hypothetical chance of bond or stock index going to zero
Replies: 8
Views: 807

Re: Seeking alpha is flawed. Ex-ante alpha must be 0.

1. If the model is correct, then ex-ante alpha for any security is 0. There's no alpha to seek. Can you explain why one measures alpha? Is the model absolutely correct, or merely "good"? I might suggest that it is probably the latter, especially if we subscribe to the notion that securiti...
by k66
Fri Feb 13, 2015 9:40 am
 
Forum: Investing - Theory, News & General
Topic: Seeking alpha is flawed. Ex-ante alpha must be 0.
Replies: 17
Views: 1364

Re: talk me out of it - investing in oil

Why not? Let 'er rip! As you noted, this would be an expendable investment that otherwise won't detract from your primary savings.

Have you read any of the exploits of the "Turtles"? The trend is your friend and all of that.
by k66
Sun Feb 08, 2015 10:17 pm
 
Forum: Investing - Theory, News & General
Topic: talk me out of it - investing in oil
Replies: 50
Views: 4927

Re: Successful investing: Is it luck or skill?

There are definitely things that we can do that would purposefully (I think) sink a portfolio and could be done deliberately if need be. For example, utilizing highly leveraged funds (inverse or long) for extended periods of time; or maybe a little less poisonous, just staying in cash indefinitely. ...
by k66
Wed Feb 04, 2015 11:59 pm
 
Forum: Investing - Theory, News & General
Topic: Successful investing: Is it luck or skill?
Replies: 26
Views: 2662

Re: Crispey Odin's warning

I like "Crispey Odin" much better.
by k66
Mon Feb 02, 2015 9:46 am
 
Forum: Investing - Theory, News & General
Topic: Crispin Odey's warning
Replies: 15
Views: 2231

Re: Any other investors with 70/30 portfolio?

I am scheduled to turn 49 this year and plan to maintain a 75/25 AA for the next decade.
by k66
Fri Jan 30, 2015 9:47 am
 
Forum: Investing - Theory, News & General
Topic: Any other investors with 70/30 portfolio?
Replies: 60
Views: 6829

Re: How is risk described in newspaper?

I suspect that the news articles measure return by past performance. I wonder how they measure risk or whether they mention risk at all. Have you seen articles mentioned stdev, beta, VaR, skewness, or kurtosis? I haven't seen any of those types of discussions related to risk in the media. If they e...
by k66
Wed Jan 21, 2015 7:54 pm
 
Forum: Investing - Theory, News & General
Topic: How is risk described in newspaper?
Replies: 3
Views: 271

Re: Trying to understand index funds

There will always be differences between "The Index" and "The Fund That Tracks The Index", but they are small, if not miniscule. This does give rise to "Tracking Error".
by k66
Tue Jan 20, 2015 3:21 pm
 
Forum: Investing - Theory, News & General
Topic: Trying to understand index funds
Replies: 14
Views: 1231

Re: Bored when market is closed

To hell with boring old equity markets and their silly irreverent hours and days of operation… Get into the “real game” of FX trading: it does go 24/7/365 from from time zone to the next. Go-Go-Go! I recall reading one of Schwager’s “Market Wizards” books in which one of his interviewees traded FX a...
by k66
Mon Jan 19, 2015 2:23 pm
 
Forum: Investing - Theory, News & General
Topic: Bored when market is closed
Replies: 28
Views: 2143

Re: US/foreign allocation under massive relative US drop

Suppose for simplicity that right now the US market is 50% of the world market cap, and foreign markets are 50%. Two ways to get exposure are : (1) 100% Vanguard Total World Stock ETF (VT), (2) 50% Vanguard Total Stock Market ETF (VTI) + 50% Vanguard Total International Stock ETF (VXUS). Let's supp...
by k66
Sun Jan 18, 2015 12:59 pm
 
Forum: Investing - Theory, News & General
Topic: US/foreign allocation under massive relative US drop
Replies: 21
Views: 1469

Re: Poll: Your Max. REIT Allocation

nisiprius wrote:...and not a moment's regret. I had been playing with fire and hadn't known it, and was happy to get out of it without being singed.


What your concern in particular? Was it with an appropriate level of diversification or rooted in any way with the structure of a REIT itself?
by k66
Sat Jan 17, 2015 2:47 pm
 
Forum: Investing - Theory, News & General
Topic: Poll: Your Max. REIT Allocation
Replies: 56
Views: 4847

Re: Is $50 oil really the norm?

I read an article this morning (Financial Post) where market analysts were suggesting that Saudi Arabia has deliberately abandoned their traditional role as the swing producer (as opposed to it being some type of accidental or unintentional move), but could not give any evidence or motive for this i...
by k66
Sat Jan 17, 2015 12:21 pm
 
Forum: Investing - Theory, News & General
Topic: Is $50 oil really the norm?
Replies: 41
Views: 3586

Re: Poll: Your Max. REIT Allocation

goalie wrote:Not sure how to answer, but I hold 8% Vanguard domestic REIT fund and 8% Vanguard int'l Real Estate fund. Do I say 8% or 16% ? Chip :confused


I was looking for "total" allocation, so in your case, that would be 16%.
by k66
Sat Jan 17, 2015 11:17 am
 
Forum: Investing - Theory, News & General
Topic: Poll: Your Max. REIT Allocation
Replies: 56
Views: 4847

Re: Poll: Your Max. REIT Allocation

I'm not familiar with TREA, but I suppose we could just reference the Wikipedia definition and let you decide how it fits: A real estate investment trust (REIT) /ˈriːt/ is a company that owns, and in most cases, operates income-producing real estate. REITs own many types of commercial real estate, r...
by k66
Sat Jan 17, 2015 10:55 am
 
Forum: Investing - Theory, News & General
Topic: Poll: Your Max. REIT Allocation
Replies: 56
Views: 4847

Poll: Your Max. REIT Allocation

I am just trying to get a sense of the level that people see REITs playing in their portfolios. And I am considering REITs only--not personal/owned real estate.

Feel free to elaborate on which fund(s) you own and why.
by k66
Sat Jan 17, 2015 10:26 am
 
Forum: Investing - Theory, News & General
Topic: Poll: Your Max. REIT Allocation
Replies: 56
Views: 4847

Re: Help this dummy get back on track

If you are looking for the conviction to maintain a consistent investing strategy (BH or otherwise), then that has to come from you alone. You have to want to do it because you truly believe that it is the right thing to do. We cant give you that directly. We can tell you that we do have those convi...
by k66
Wed Jan 14, 2015 3:05 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help this dummy get back on track
Replies: 12
Views: 1309

Re: Bogleheads 2015 Hedge Fund Contest

Thanks Norbert - we appreciate your effort in doing this!
by k66
Sat Jan 10, 2015 11:30 am
 
Forum: Investing - Theory, News & General
Topic: Bogleheads 2015 Hedge Fund Contest
Replies: 139
Views: 13264

Re: U.S. stocks in freefall

VictoriaF wrote:The stocks are in a free sine wave-like pattern: they freely sin but do not fall.
(A new spin on a financial porn.)

Victoria


Can someone please "cosine" Victoria's hypothesis? I need validation before making any new lines in a market this "tricker-numeratry"...
by k66
Fri Jan 09, 2015 4:54 pm
 
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 1225
Views: 229799

Year of the Goat (Best for Stocks)

I think the only actionable item(s) from this article would be the prospect for creating new comical references to Astrologers and/or Animals as used in financial planning:

http://business.financialpost.com/2015/01/05/year-of-the-goat-best-for-stocks/?__lsa=c00d-94cf
by k66
Wed Jan 07, 2015 10:12 am
 
Forum: Investing - Theory, News & General
Topic: Year of the Goat (Best for Stocks)
Replies: 1
Views: 455

Re: rebalance at 3% change ok?

Rock the Whim, John, Rock the Whim!

Quick: check and see if you can get the personalized plates too 8-)
by k66
Tue Jan 06, 2015 10:50 pm
 
Forum: Investing - Theory, News & General
Topic: rebalance at 3% change ok?
Replies: 24
Views: 1912

Re: rebalance at 3% change ok?

AA is 70/30 70 stocks 30 bonds , now at 73 / 27 73 % stocks , 27 % bonds, I'm 3% off, and want to transfer 3% from stocks to bonds Do I need to wait to 5% off is what I am asking I have gained over the time with the stocks, and it looks like stocks may be in for a long volatile period, and drop I f...
by k66
Tue Jan 06, 2015 2:37 pm
 
Forum: Investing - Theory, News & General
Topic: rebalance at 3% change ok?
Replies: 24
Views: 1912

Re: 2015 Predictions: Most Popular Topics

I am going to CCA (Comment/Complain Average) into this thread... Let's add: X% is the new 4% to the roster--followed by a list all the reasons why it could never possibly work in the future, irrespective of the fact that it has worked quite well under duress in the past... We will then also dutifull...
by k66
Mon Jan 05, 2015 9:54 pm
 
Forum: Investing - Theory, News & General
Topic: 2015 Predictions: Most Popular Topics
Replies: 38
Views: 2463

Re: Is "stay the course" a commandment or a suggestion?

For myself, "Stay the course" means stay on the path you are on (as laid out in your plan) until such a time that change is required. This would be a major change like a birth, death, marriage, divorce, employment status, etc. It does not mean wandering just because the market winds are bl...
by k66
Mon Jan 05, 2015 2:14 pm
 
Forum: Investing - Theory, News & General
Topic: Is "stay the course" a commandment or a suggestion?
Replies: 60
Views: 4189

Re: 2015 Predictions: Most Popular Topics

Black Swan of the week... Slightly off this topic base, but it always seems to have popular use in the conventional financial media is the term "increasing volatility" to try and goad readers into believing that today's volatility is somehow better, worse, different or otherwise special in...
by k66
Sat Jan 03, 2015 5:57 pm
 
Forum: Investing - Theory, News & General
Topic: 2015 Predictions: Most Popular Topics
Replies: 38
Views: 2463

Re: Bogleheads 2015 Hedge Fund Contest

"Mad Stacks o' Cash - Yo!" is quietly being dismembered at the end of the 2014 season in anticipation of a new, better fund: "Trixter". Although MSoCY had only the best of intentions through out its short life, ultimately it succumbed to the one thing that no fund should ever do,...
by k66
Thu Jan 01, 2015 3:45 pm
 
Forum: Investing - Theory, News & General
Topic: Bogleheads 2015 Hedge Fund Contest
Replies: 139
Views: 13264

Re: 2015 BOGLEHEAD CONTEST REGISTRATION

Continuing with my past practice of simply re-arranging the digits of the previous year's close to compose the new estimate, I offer:

0982.05
by k66
Thu Jan 01, 2015 3:07 pm
 
Forum: Investing - Theory, News & General
Topic: 2015 BOGLEHEAD CONTEST REGISTRATION
Replies: 556
Views: 20393

Re: 2014 Portfolio Returns

Don't we usually wait until the end of the year to post end-of-the-year results? I think the end of the year is still another week or so away.
by k66
Sat Dec 20, 2014 10:16 am
 
Forum: Investing - Theory, News & General
Topic: 2014 Portfolio Returns
Replies: 25
Views: 2772

Individual Investors Churn & Burn Themselves

Along the same lines as "active management, in aggregate, doesn't outperform a representative index" because of the implicit cost of the active management itself, individual investors apparently are also no strangers to churning their own accounts with no gain (on average) to show for it. ...
by k66
Thu Nov 20, 2014 10:04 pm
 
Forum: Investing - Theory, News & General
Topic: Individual Investors Churn & Burn Themselves
Replies: 3
Views: 1218

Re: a look at technical indicators

A friend of mine teaches a community college course on investing. He teaches a simple technical analysis "method" to sidestep bear markets and re-enter after they have passed. His simple method of sidestepping a bear market is this: At the end of each month you look at a graph showing the...
by k66
Sat Oct 04, 2014 9:16 am
 
Forum: Investing - Theory, News & General
Topic: a look at technical indicators
Replies: 19
Views: 1976

Re: Kitces: Sequence of returns risk and 10yr real returns

Yes - this is a good piece. I never thought that SOR risk was particularly sensitive to the first year or any single year and just loosely considered it to be something like the first 3 to 5 years of sub-par market returns. So if the 10 year (real return) track record is the better predictor and is ...
by k66
Thu Oct 02, 2014 8:53 am
 
Forum: Investing - Theory, News & General
Topic: Kitces: Sequence of returns risk and 10yr real returns
Replies: 14
Views: 1490
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