Search found 12456 matches

by larryswedroe
Sun Aug 02, 2015 5:15 pm
Forum: Investing - Theory, News & General
Topic: Houston, we have a problem... [Small cap historical performance]
Replies: 22
Views: 1174

Re: Houston, we have a problem... [Small cap historical performance]

I'd just add this, when looking at returns of asset classes have to look at the valuations at start and end The DFA micro fund was created right at the tail end of the "small cap bubble" when small caps outperformed large by massive margin from 75-83,a bout 14% a year for that 9 years. Sin...
by larryswedroe
Sun Aug 02, 2015 1:31 pm
Forum: Investing - Theory, News & General
Topic: Houston, we have a problem... [Small cap historical performance]
Replies: 22
Views: 1174

Re: Houston, we have a problem... [Small cap historical performance]

Unfortunately Vanguard's small cap fund used to be tied to the R2k, an awful index which underperformed by something like 2% a year because it was easily exploited Here's data for live period 1/82-6/15 which is now over 30 years and of course includes trading costs and fund fees-- DFA Micro cap 12.2...
by larryswedroe
Sat Aug 01, 2015 9:13 pm
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

nedsaid the strategies you are employing is virtually identical to what the research suggests is the "right" way---combining momentum with value as they are naturally negatively correlated. And it's what AQR value/mom/profitability funds do. In fact we are now using AQR large multi style f...
by larryswedroe
Sat Aug 01, 2015 2:52 pm
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

nedsaid I cannot account for Siegel, only guessing he is promoting his Wisdom Tree funds which have dividend bent. As to the white paper, there is already a ton of evidence that yes like all metrics that include price, be it p/b, p/e, p/s, p/cf, p/d has some explanatory power as a VALUE strategy. Bu...
by larryswedroe
Sat Aug 01, 2015 7:08 am
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

two things, then I'm done on this Naha Amazing --I have never bashed dividend paying stocks. In fact I have repeatedly said that the dividend is irrelevant (neither good nor bad) in expected returns. I have pointed out that focusing on dividends has two negatives. The first is reduced diversificatio...
by larryswedroe
Sat Aug 01, 2015 6:41 am
Forum: Investing - Theory, News & General
Topic: Holding forecasters accountable
Replies: 10
Views: 929

Re: Holding forecasters accountable

Scott
Thanks for taking the time to write, makes the effort worthwhile.
Best wishes
Larry
by larryswedroe
Fri Jul 31, 2015 5:55 pm
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

fwiw, while the returns to factors are unstable, just as the return to the beta factor itself is unstable, for passive funds their exposure to factors is generally fairly stable, unless the fund alters its construction rules. DFA for example has altered its rules from time to time, incorporating mom...
by larryswedroe
Fri Jul 31, 2015 11:27 am
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

simple
Yes that is a great resource for investors, showing the sources of returns.
And note that neither in value nor quality, nor other factors is dividends a screen
Larry
by larryswedroe
Fri Jul 31, 2015 10:12 am
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

Nedsaid [url]I want to point out that Large Value has been doing terrible lately[/url] All I can say is you and I disagree on definition of exaggeration. I already gave answer on High dividend strategy, it has much larger exposure to the quality factor, which as I also explained has nothing to do wi...
by larryswedroe
Fri Jul 31, 2015 10:03 am
Forum: Investing - Theory, News & General
Topic: Holding forecasters accountable
Replies: 10
Views: 929

Holding forecasters accountable

http://www.etf.com/sections/index-investor-corner/swedroe-gurus-without-clue

The media never does because accountability ruins the game

Larry
by larryswedroe
Thu Jul 30, 2015 8:15 am
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

Nedsaid Well me thinks you exaggerate a bit. 1/10-6/15 Russell 1000 value underperformed R1k by just 60bp, so terrible? As to dividend growth, it's a QUALITY/PROFITABILITY strategy, in indirect way. Just as dividend is indirect way to value, though even high div is the worst of the value factors in ...
by larryswedroe
Tue Jul 28, 2015 8:34 pm
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

Nirav Dividends actually don't indicate quality Quality is related to: profitability such as ROA and ROE and gross margins low financial leverage low operating leverage low earnings volatility low idiosyncratic risk These are the metrics that go into the quality factor. Do you see dividends there? L...
by larryswedroe
Tue Jul 28, 2015 7:46 am
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

btw-in general it should be surprising that dividend payers underperform as theory says there should be no difference in expected returns----remember any investor can create their own dividend by selling shares and any investor in dividend payer can undo the dividend. It's just that the investor &qu...
by larryswedroe
Mon Jul 27, 2015 6:51 pm
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

Nirav As to your three points, first, there is simply no logic to a "dividend" strategy, not in financial theory. Dividends are not a factor in returns, though indirectly they MAY indicate exposure to other factors (such as quality/profitability, or at one time value). Second, it's not fiv...
by larryswedroe
Mon Jul 27, 2015 4:00 pm
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

two points, Nisi, yes I very much disagree with those two, with EM bonds being the one I have the most disagreement with. Note I have disagreed with some of Malkiel's other recommendations (though I have the highest regards for him) especially to invest in China which he has argued for (making the m...
by larryswedroe
Mon Jul 27, 2015 8:19 am
Forum: Investing - Theory, News & General
Topic: Another look at dividend paying stocks
Replies: 57
Views: 5232

Re: Another look at dividend paying stocks

One thing to keep in mind you can improve the returns of the non div payers by simply applying some screens to kick out the lottery stocks, those penny stocks and growth stocks with low/no profitability.
Larry
by larryswedroe
Thu Jul 23, 2015 6:27 pm
Forum: Investing - Theory, News & General
Topic: Does how often you check your portfolio correlate with returns
Replies: 35
Views: 2663

Re: Does how often you check your portfolio correlate with returns

Late Starter I don't have any particular definition. What the research finds is that IN GENERAL the less frequently one looks the better they do But if you look every day and it doesn't impact your activity that wouldn't matter---but that would make you the unusual person. So it really depends on th...
by larryswedroe
Wed Jul 22, 2015 5:07 pm
Forum: Investing - Theory, News & General
Topic: Does how often you check your portfolio correlate with returns
Replies: 35
Views: 2663

Re: Does how often you check your portfolio correlate with returns

Fig, My pleasure and glad you found it helpful. Just simple thought to consider. If you don't check values you are far less likely to be tempted to trade (sell) and we know inactivity (other than tax loss harvesting and rebalancing) is better than activity. Note not only is the pain of a loss on ave...
by larryswedroe
Wed Jul 22, 2015 11:39 am
Forum: Investing - Theory, News & General
Topic: Does how often you check your portfolio correlate with returns
Replies: 35
Views: 2663

Does how often you check your portfolio correlate with returns

http://www.etf.com/sections/index-investor-corner/swedroe-its-ok-look-away

Turns out correlation is negative, as you might guess
As Buffett said, he continues to make more money when snoring than when awake
Larry
by larryswedroe
Mon Jul 20, 2015 1:51 pm
Forum: Investing - Theory, News & General
Topic: a tale of two small value funds
Replies: 30
Views: 3314

Re: a tale of two small value funds

Nisi Sorry been traveling and just got back from two weeks in Ireland on Tauck tour. Few comments., First we looked at 3 passive small value funds so it should not be surprising that given their construction rules you would get high and significant loadings on the three factors of beta, size and val...
by larryswedroe
Mon Jul 20, 2015 1:44 pm
Forum: Investing - Theory, News & General
Topic: first half look at hedge fund returns
Replies: 11
Views: 884

Re: first half look at hedge fund returns

MAYNARD We agree completely that hedge funds are not an asset class, they are a compensation scheme With that said the data very much disagrees with you on returns, adjusted for risks, in fact typical hedge funds have high risks as they don't really hedge anything. Basically as group results are sim...
by larryswedroe
Mon Jul 20, 2015 9:09 am
Forum: Investing - Theory, News & General
Topic: first half look at hedge fund returns
Replies: 11
Views: 884

Re: first half look at hedge fund returns

Taylor asked me about biases in the data on hedge funds, specifically due to self reporting. So thought I would post a general response. To begin self reporting can work to ways. Those that have poor returns will likely choose not to report while those with great returns and don't want new money may...
by larryswedroe
Fri Jul 17, 2015 3:15 pm
Forum: Investing - Theory, News & General
Topic: Shiller - The Mirage of the Financial Singularity
Replies: 17
Views: 2516

Re: Shiller - The Mirage of the Financial Singularity

FWIW
I speak regularly to groups at Tiger 21 a group of very high net worth investors
Many of told me they invest in Renaissance Technology funds that have been set up separate from the fund that manages their personal assets and not one did well at all.
Larry
by larryswedroe
Fri Jul 17, 2015 3:12 pm
Forum: Investing - Theory, News & General
Topic: fund construction rules matter
Replies: 2
Views: 528

fund construction rules matter

http://www.etf.com/sections/index-investor-corner/swedroe-5?nopaging=1

thought this analysis of small cap indices would be of interest
Larry
by larryswedroe
Mon Jul 13, 2015 10:21 am
Forum: Investing - Theory, News & General
Topic: review of research on carry trade
Replies: 0
Views: 233

review of research on carry trade

http://www.etf.com/sections/index-investor-corner/swedroe-truth-about-carry-trade?nopaging=1 hope you find this of interest --the carry trade is one of the best documented strategies, going back decades as strategy and research shows why it is expected to work, just like with stocks there's a risk ...
by larryswedroe
Sat Jul 11, 2015 4:03 pm
Forum: Investing - Theory, News & General
Topic: a tale of two small value funds
Replies: 30
Views: 3314

Re: a tale of two small value funds

nisi
the tstat for each fund was significant, when you have more than one fund you have tstats, plural -one tstat for each fund
thought that sure have been very clear, have written that language hundreds of times and no one ever had any confusion
Larry
by larryswedroe
Sat Jul 11, 2015 9:47 am
Forum: Investing - Theory, News & General
Topic: look at structured notes
Replies: 16
Views: 1342

Re: look at structured notes

active funds serve a clear social value, setting prices and keeping markets efficient and thus capital allocated efficiently. only issue is question of is the cost worth the social benefits? Most structured notes serve no social purpose at all, as same objective can be accomplished by buyer at lower...
by larryswedroe
Fri Jul 10, 2015 11:55 am
Forum: Investing - Theory, News & General
Topic: look at structured notes
Replies: 16
Views: 1342

look at structured notes

http://www.etf.com/sections/index-investor-corner/swedroe-4
Most of these should be made illegal IMO as they truly serve no social purpose, only serving to transfer assets from investors to issuers
Larry
by larryswedroe
Mon Jun 29, 2015 9:00 am
Forum: Investing - Theory, News & General
Topic: Puerto Rico Governor Says Island’s Debts Are ‘Not Payable’
Replies: 37
Views: 3480

Re: Puerto Rico Governor Says Island’s Debts Are ‘Not Payable’

Just because a bond fund owns PR bonds does not mean that they will suffer losses, they could own bonds that have been PRE REFINANCED, meaning they are backed by safe bonds, typically Treasuries
Larry
by larryswedroe
Thu Jun 25, 2015 9:08 am
Forum: Investing - Theory, News & General
Topic: a Look at Neuberger Berman funds, comparing to passive funds
Replies: 7
Views: 1129

Re: a Look at Neuberger Berman funds, comparing to passive funds

m personal definition of passive is that active involves judgment leading to individual security selection while passive is systematic process that is repeatable and doesn't involve judgment. So by that definition DFA, AQR, Bridgeway, Wisdom Tree, RAFI are all passive. Fama's definition was no indiv...
by larryswedroe
Mon Jun 22, 2015 11:40 am
Forum: Investing - Theory, News & General
Topic: The impact of HFTs on trading costs and liquidity
Replies: 0
Views: 354

The impact of HFTs on trading costs and liquidity

http://www.etf.com/sections/index-investor-corner/swedroe-high-frequency-trading-price-efficiency?nopaging=1 Way too much negative press about the HFTs, though some simple solutions are available to address the abuses that do occur--such as must leave a bid or offer outstanding for X period of time...
by larryswedroe
Fri Jun 19, 2015 7:36 am
Forum: Investing - Theory, News & General
Topic: incorporating non financial assets
Replies: 0
Views: 350

incorporating non financial assets

So many investors and I have found even professional advisors don't consider the non financial assets when developing investment plans http://www.etf.com/sections/index-investor-corner/swedroe-remember-nonfinancial-assets?nopaging=1 Hope you find this of interest Note if want to read about the issue...
by larryswedroe
Wed Jun 17, 2015 3:01 pm
Forum: Investing - Theory, News & General
Topic: relationship between country growth rates and stock returns
Replies: 5
Views: 830

Re: relationship between country growth rates and stock returns

First, this study only confirms what studies going back to 1900 have found, so the short period is supported by the VERY long term evidence. Second, to answer Jimkinny's question,if you can successfully forecast faster than expected GNP growth it's possible you could benefit, but not for sure becaus...
by larryswedroe
Wed Jun 17, 2015 8:04 am
Forum: Investing - Theory, News & General
Topic: relationship between country growth rates and stock returns
Replies: 5
Views: 830

relationship between country growth rates and stock returns

http://www.etf.com/sections/index-investor-corner/swedroe-high-growth-countries-no-sure-thing no different than with individual stocks, the expected growth in earnings is already built into prices. Hope you find this helpful, it's an issue I continually have to address with clients/investors Larry
by larryswedroe
Mon Jun 15, 2015 7:10 am
Forum: Investing - Theory, News & General
Topic: UK Bogleheads
Replies: 2
Views: 444

UK Bogleheads

In case any of you are interested there has been a UK version of Think, Act, and Invest Like Buffet in the works and finally set to go to printers and should be available within a few weeks. It was done in coordination with the folks at Barnett Ravenscroft Wealth Management, who also work with Sensi...

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