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Re: U.S. Stock Valuations — Making History?

Mean reversion may not be the best characterization of U.S. corporate earnings, as they've shown an overall upward trend of about 7% per year over the long term — but they definitely fluctuate in cycles with the overall economy, both domestic and global. Maybe we could assume that [earnings] oscill...
by lazyday
Mon Mar 16, 2015 5:06 pm
 
Forum: Investing - Theory, News & General
Topic: U.S. Stock Valuations — Making History?
Replies: 46
Views: 4731

Re: U.S. Stock Valuations — Making History?

It's hard to make the case that U.S. stocks are anywhere near "bubble territory," in my view, primarily because U.S. corporate earnings in aggregate have been spectacular since the 2008 financial crisis (chart on right). Do earnings mean revert? If so, it could be dangerous to pay a high ...
by lazyday
Sat Mar 14, 2015 9:51 am
 
Forum: Investing - Theory, News & General
Topic: U.S. Stock Valuations — Making History?
Replies: 46
Views: 4731

Re: PXSV has changed indexes

Just from a very quick search, there's probably more: Dec 19 2012 http://www.invescopowershares.com/news/pdf/NR%20121912%20Invesco%20PowerShares%20Announces%20Changes%20to%20ETF%20Family.pdf As part of its ongoing commitment to putting investors’ interests first, Invesco PowerShares announced that i...
by lazyday
Sat Mar 14, 2015 9:27 am
 
Forum: Investing - Theory, News & General
Topic: PXSV has changed indexes
Replies: 109
Views: 8778

Re: International PE10 Update

DonCamillo wrote:Most of the time, I assume that A, B, and C may be reasonable approximations of the real world, but not something I want to rely on.

Thanks.

For P/S, I'm thinking more of an index average (like the starcapital link) than for stockpicking.
by lazyday
Sat Feb 28, 2015 9:23 am
 
Forum: Investing - Theory, News & General
Topic: International PE10 Update
Replies: 28
Views: 2940

Re: International PE10 Update

Earnings and Profits are nearly entirely fictitious concepts.... My own philosophy is that the only reasonably accurate number in a company's financial report is the dividend paid. Everything else is a guess that probably has some relationship to reality, but the relationship might be quite distant...
by lazyday
Thu Feb 26, 2015 4:04 am
 
Forum: Investing - Theory, News & General
Topic: International PE10 Update
Replies: 28
Views: 2940

Re: Converting VG ETFs to open ended funds

What I am interested in is why VG will not convert ETFs to MFs. They do it the other way one time. What is the rationale for not converting to MFs? Buying a traditional mutual fund when it's popular, or selling when there's panic can harm other existing shareholders. This is especially true for les...
by lazyday
Wed Feb 25, 2015 9:09 am
 
Forum: Investing - Theory, News & General
Topic: Converting VG ETFs to open ended funds
Replies: 15
Views: 750

Re: Hard drive firmware malware

I’m thinking about shifting some focus from hardening hardware and software, to more focus on isolating financial transactions and accounts. A dedicated computer and ID helps isolate transactions. Isolating accounts might reduce the impact of a successful attack, but I don’t know what’s practical an...
by lazyday
Tue Feb 17, 2015 4:43 pm
 
Forum: Personal Consumer Issues
Topic: Hard drive firmware malware
Replies: 9
Views: 744

Re: Emerging markets bonds better than US high yield bonds?

I didn't notice that SEMF isn't a local currency fund. I personally wouldn't want EM bonds except maybe short term, unless they offered a huge yield to make up for the risks. The currency fund seems worth learning about, because of the high yield and chance of PPP reversion , with low credit and ter...
by lazyday
Tue Feb 17, 2015 3:53 pm
 
Forum: Investing - Theory, News & General
Topic: Emerging markets bonds better than US high yield bonds?
Replies: 28
Views: 2685

Re: Hard drive firmware malware

I believe that SSDs have firmware, or at least some do. A Chromebook might be safe because it's probably resistant to malware that would install the firmware. A dedicated computer for finances might also help, if it was known good when put to that use. It's unlikely to be infected just from visiting...
by lazyday
Tue Feb 17, 2015 10:32 am
 
Forum: Personal Consumer Issues
Topic: Hard drive firmware malware
Replies: 9
Views: 744

Hard drive firmware malware

It's been proposed that firmware in hard drives or other computer components might be attacked by malware. This might cause a compromise that is difficult to recover from. Well, it's been done. I don't know how easy it is to copy and repurpose the work, but it's out there. This is perhaps the most p...
by lazyday
Tue Feb 17, 2015 10:05 am
 
Forum: Personal Consumer Issues
Topic: Hard drive firmware malware
Replies: 9
Views: 744

Re: When would you retire money no object?

15, but might have come out of retirement someday.
by lazyday
Tue Feb 17, 2015 8:30 am
 
Forum: Personal Finance (Not Investing)
Topic: When would you retire money no object?
Replies: 64
Views: 3466

Re: Tobyhanna (Valor)-did they change conditions of 7 year C

This is another case of a credit union retroactively changing the terms of its CDs. It’s similar to the cases when Fort Knox Federal Credit Union and CEFCU increased their early withdrawal penalties on existing CDs. Both of these credit unions claimed that their member agreements gave them the righ...
by lazyday
Tue Feb 17, 2015 5:22 am
 
Forum: Investing - Theory, News & General
Topic: Tobyhanna (Valor)-did they change conditions of 7 year CD?
Replies: 11
Views: 1031

Re: University of Phoenix

But overall, a for-profit isn't going to carry the weight of a non-profit I looked into the for profits a few years ago when there were proposals to limit government funding of degrees. There seemed to be a wide range of quality. Some were unethically aggressive in recruiting, and tried to let anyo...
by lazyday
Tue Feb 17, 2015 4:44 am
 
Forum: Personal Consumer Issues
Topic: University of Phoenix
Replies: 20
Views: 2439

Re: Free online news

You can structure it to suit your preferences too. Anyone know a good way to reduce the number of articles from local and low quality sources? This wasn't a problem until relatively recently; maybe the algorithm changed. It helps to add lots of good sources with "adjust sources" and set t...
by lazyday
Tue Feb 17, 2015 4:30 am
 
Forum: Personal Consumer Issues
Topic: Free online news
Replies: 22
Views: 1909

Re: Emerging markets bonds better than US high yield bonds?

Didn't spot much that's interesting in the annual report. There is a capital loss carryforward, but it still might be best to hold in an IRA. I don't think there's any foreign taxes involved (assuming it never invests directly), and if I understand correctly, after the fund does well enough, there w...
by lazyday
Mon Feb 16, 2015 6:21 am
 
Forum: Investing - Theory, News & General
Topic: Emerging markets bonds better than US high yield bonds?
Replies: 28
Views: 2685

Re: Credit Suisse Yearbook 2015

Obtaining copies The Yearbook is available as a free download here. The [2014] Sourcebook is a hard-copy publication and can be sent only by post. Copies of both publications may be requested by journalists from the press contacts below. http://www.six-swiss-exchange.com/issuers/equities/tensid_new...
by lazyday
Mon Feb 16, 2015 5:31 am
 
Forum: Investing - Theory, News & General
Topic: Credit Suisse Yearbook 2015
Replies: 4
Views: 812

Re: Emerging markets bonds better than US high yield bonds?

Sammy, If you click "currency" on your RA link, you can see expected returns for 12 of the 15 currencies in CAW. Chile, Columbia, Philippines are missing. You can "Export Data" near the bottom of the page, and sort by "Market". Since CAW rebalences to equal weight, I av...
by lazyday
Sun Feb 15, 2015 1:11 pm
 
Forum: Investing - Theory, News & General
Topic: Emerging markets bonds better than US high yield bonds?
Replies: 28
Views: 2685

Re: Emerging markets bonds better than US high yield bonds?

Sammy_M wrote:Wisdomtree's CEW fund

Oddly, I didn't see a place to download the annual report.

Googling this will return a result from hosted.rightprospectus.com for the Aug 31 2014 report:
Code: Select all
annual-report wisdomtree trust Currency Strategy, Fixed Income and Alternative Funds
by lazyday
Sun Feb 15, 2015 11:37 am
 
Forum: Investing - Theory, News & General
Topic: Emerging markets bonds better than US high yield bonds?
Replies: 28
Views: 2685

Re: Expected Returns Spreadsheet (DDM, 1/PE and more)

It appears you might be looking at periods of 10+ years to evaluate predictability? Big sheet; I haven't tried to understand it. I believe that GMO has said that they shortened their predictions to 7 year expected returns because markets tend to cross fair value sometime within 7 years. They've give...
by lazyday
Sun Feb 15, 2015 6:30 am
 
Forum: Investing - Theory, News & General
Topic: Expected Returns Spreadsheet (DDM, 1/PE and more)
Replies: 17
Views: 1460

Re: Just no petroleum or defense?

You might get close using sector funds. For example you could use http://www.sectorspdr.com/sectorspdr/ and leave out the Energy and Industrials sectors. EDIT : Vanguard funds posted above by Ken might be better, as I think they include smallcaps or at least midcaps. There might be other Industrials...
by lazyday
Sat Feb 14, 2015 10:22 pm
 
Forum: Investing - Help with Personal Investments
Topic: Just no petroleum or defense?
Replies: 49
Views: 3098

iCar

(WSJ) Apple Gears Up to Challenge Tesla in Electric Cars (Reuters) Apple learning to make self-driving car: source https://news.google.com/news/section?pz=1&cf=all&ned=us&hl=en&q=Apple+Inc or google search either of the above lines. Apple might be serious about building a car themsel...
by lazyday
Sat Feb 14, 2015 9:46 am
 
Forum: Investing - Help with Personal Investments
Topic: AAPL
Replies: 216
Views: 48032

Re: Vanguard's Recommended Portfolio

Our original plan was to go with a 60/40 portfolio, cinghiale. But the Vanguard advisor cautioned us that Vanguard's forecast for bonds over the next decade wasn't very optimistic. We talked about how prone we'd be to alter course if markets got bad like in 2008, and I honestly told him that we con...
by lazyday
Sat Feb 14, 2015 8:44 am
 
Forum: Investing - Help with Personal Investments
Topic: Vanguard's Recommended Portfolio
Replies: 36
Views: 6176

Re: Is anything on sale now?

Not sure anything's cheap, except in a relative sense.

Emerging Markets and maybe UK.

I like the RA equity returns methodology, and the page lack_ey linked.

Also see cjking's starcapital link in my UK thread. Korea and Hungary look interesting.
by lazyday
Sat Feb 14, 2015 8:06 am
 
Forum: Investing - Help with Personal Investments
Topic: Is anything on sale now?
Replies: 13
Views: 1564

Re: Asymmetric Rebalancing in Withdrawal Phase

The net result of this is that portfolio volatility would be lower, but so will your portfolio returns over the long run because of the lower average equity allocation. As Nisi pointed out, it might make more sense just to determine the max equity allocation that you can stick with over the long pu...
by lazyday
Sat Feb 14, 2015 6:43 am
 
Forum: Investing - Theory, News & General
Topic: Asymmetric Rebalancing in Withdrawal Phase
Replies: 27
Views: 1908

Re: Asymmetric Rebalancing in Withdrawal Phase

If you follow Wm Bernstein's approach of securing your retirement with 20-25 years worth of drawdown needs in "safe" products (I would say to age 90 vs a set # of years) and allocate the balance however you want -- you don't have much of a rebalancing issue. This is great if your portfoli...
by lazyday
Sat Feb 14, 2015 6:35 am
 
Forum: Investing - Theory, News & General
Topic: Asymmetric Rebalancing in Withdrawal Phase
Replies: 27
Views: 1908

Re: Tolerance for "rebalancing risk" in retirement

Say our portfolio is 60% global equity and 40% TIPS. Our coward’s 40 year SWR includes 1/40 * TIPS ½ TIPS yield * TIPS ½ equity dividend yield * equity Today this totals to roughly 1+.2+.75 = 1.95% If stocks fall 10% but dividends aren’t cut, then if we don’t rebalance, our SWR is unchanged. We stil...
by lazyday
Fri Feb 13, 2015 3:54 pm
 
Forum: Investing - Theory, News & General
Topic: Tolerance for "rebalancing risk" in retirement
Replies: 29
Views: 1691

Re: Tolerance for "rebalancing risk" in retirement

If I get around to it, maybe I'll find historical bond and equity yield, such as on Jan 1 2008 and 2009. Equity yield could be current dividend yield or 1/CAPE. Bond could be TIPS yield or real yield of nominals. Selling several years of spending in bonds to buy falling equities might be easier (and...
by lazyday
Fri Feb 13, 2015 5:25 am
 
Forum: Investing - Theory, News & General
Topic: Tolerance for "rebalancing risk" in retirement
Replies: 29
Views: 1691

Re: Foreign Stocks in Taxable - Gotcha w/ foreign tax credit

Assuming Canada and/or Germany still aren't taxing dividends in an IRA, I would hope that Vanguard won't withhold taxes for Vanguard funds held directly at Vanguard. From 2010 Germany, for one, exempts IRAs from the German withholding tax under a revised treaty with the United States. Germany withho...
by lazyday
Tue Feb 10, 2015 9:46 am
 
Forum: Investing - Theory, News & General
Topic: Foreign Stocks in Taxable - Gotcha w/ foreign tax credit
Replies: 58
Views: 7482

Re: Emerging markets bonds better than US high yield bonds?

If risk to you is "bad returns in bad times" then I think US$ EM bonds are a horrible choice.
by lazyday
Tue Feb 10, 2015 7:13 am
 
Forum: Investing - Theory, News & General
Topic: Emerging markets bonds better than US high yield bonds?
Replies: 28
Views: 2685

Re: Foreign Stocks in Taxable - Gotcha w/ foreign tax credit

If you hold foreign stocks in a Roth and US stocks in taxable, I think you still pay more taxes than if you switch locations. But I haven't run through the numbers. Germany has or had a similar treaty as Canada, where IRA dividends shouldn't be taxed. I've seen comment(s) that sometimes this tax is ...
by lazyday
Tue Feb 10, 2015 7:00 am
 
Forum: Investing - Theory, News & General
Topic: Foreign Stocks in Taxable - Gotcha w/ foreign tax credit
Replies: 58
Views: 7482

Re: Home Bias in Brazil. Should I overweight it even more?

With half in the bank, the currency risk might not be so bad. I also like value investing, but I'm not willing to pay too much to do it. Markets are usually very smart, so if something looks cheap it probably has high enough risk that it should be that cheap. Paying a high expense ratio can make a b...
by lazyday
Mon Feb 09, 2015 9:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: Home Bias in Brazil. Should I overweight it even more?
Replies: 8
Views: 405

Re: Home Bias in Brazil. Should I overweight it even more?

It looks like the expense ratio of the Brazil fund is about .5% more than VWRD, making it expensive to have a high home bias.

You seem to have a lot of currency risk, but I'm not sure what the right answer is. What % of your money is in stocks vs in the bank?
by lazyday
Mon Feb 09, 2015 3:38 pm
 
Forum: Investing - Help with Personal Investments
Topic: Home Bias in Brazil. Should I overweight it even more?
Replies: 8
Views: 405

Re: Global Minimum Volatility?

OK, thanks. So how is variance and covariance estimated? Just looking at historical variance and covariance, or some complicated model that looks at different factors that contribute to return? http://www.msci.com/products/indexes/strategy/factor/minimum_volatility/ Barra Global Equity Model (GEM2) ...
by lazyday
Mon Feb 09, 2015 2:51 pm
 
Forum: Investing - Help with Personal Investments
Topic: Global Minimum Volatility?
Replies: 40
Views: 3119

Re: Global Minimum Volatility?

Has anyone seen a detailed explanation of the optimization process for a min vol fund, or are they all black boxes? I don't want to put a lot of time into this, as there's so many products coming out, I can't keep up with all of them. I did a quick check of portfolio holdings for a few min vol funds...
by lazyday
Mon Feb 09, 2015 1:38 pm
 
Forum: Investing - Help with Personal Investments
Topic: Global Minimum Volatility?
Replies: 40
Views: 3119

Re: Allocation to UK vs US

We could buy UK equity with EWU, ADRs, or QGBR. Cap weight EWU has a high expense ratio of .48%. We could instead select a small portfolio of ADRs. Or QGBR of .3% ER mix es value weighted, quality*price weighted, and min volatility portfolios. MSCI Valuations Jan 30 2015 QGBR vs UK -- QM-xUS vs xUS ...
by lazyday
Mon Feb 09, 2015 7:21 am
 
Forum: Investing - Theory, News & General
Topic: Allocation to UK vs US
Replies: 2
Views: 330

Re: No "Value Premium" in real mutual funds

stlutz wrote:It would seem based on what they are showing is that there is a real value premium, but the real world portfolio impact is probably measured more on the right side of the decimal point than the left.

Haven't DFA funds done much better than S&P 500 funds?
by lazyday
Mon Feb 09, 2015 7:01 am
 
Forum: Investing - Theory, News & General
Topic: No "Value Premium" in real mutual funds
Replies: 32
Views: 3177

Re: Your Future According to Yale Star Robert J. Shiller

Attempting a summary: Automation and growing inequality increase uncertainty which causes fear so people save more, which drives up asset prices which drives down returns, including interest rates. Unhappy populations (such as in rising inequality) causes governments to allow credit expansion which ...
by lazyday
Sun Feb 08, 2015 7:10 am
 
Forum: Investing - Theory, News & General
Topic: Your Future According to Yale Star Robert J. Shiller
Replies: 86
Views: 10633

Re: This CPA is advocating snail-mail over e-file for taxes

I believe that a number of years ago the post office mastered OCR, with lower error rates than manual entry. It's said that the letters kicked out for manual handling were mostly unreadable even by humans. The post office apparently began automated computer reading of zip codes in 1965. IRS paperwor...
by lazyday
Sun Feb 08, 2015 6:35 am
 
Forum: Personal Finance (Not Investing)
Topic: This CPA is advocating snail-mail over e-file for taxes
Replies: 55
Views: 4144

Re: Asymmetric Rebalancing in Withdrawal Phase

Two problems: it's been above it's historical average for most of the last two decades, except for one brief period in 2009, so you wouldn't have rebalanced into equities for a really long time. Over our lifetime, I think volatility-risk adjusted returns are lower than if we rebalanced normally, bu...
by lazyday
Sat Feb 07, 2015 6:33 pm
 
Forum: Investing - Theory, News & General
Topic: Asymmetric Rebalancing in Withdrawal Phase
Replies: 27
Views: 1908

Re: Asymmetric Rebalancing in Withdrawal Phase

Actually, there's a study by Wade Pfau in which he looks at market timing based on whether or not the CAPE is above it's long term average. His result was that it works and delivers about 1% more per year than buy and hold. Thanks, will read this. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=...
by lazyday
Sat Feb 07, 2015 6:28 pm
 
Forum: Investing - Theory, News & General
Topic: Asymmetric Rebalancing in Withdrawal Phase
Replies: 27
Views: 1908

Asymmetric Rebalancing in Withdrawal Phase

A retiree might limit rebalancing into equities, so that in down markets we won’t deplete the portfolio if stocks continue to fall. Bear market risk isn’t severe for an accumulator, because stocks are bought at low prices. A retiree has the opposite situation, withdrawing from a shrinking portfolio....
by lazyday
Sat Feb 07, 2015 9:12 am
 
Forum: Investing - Theory, News & General
Topic: Asymmetric Rebalancing in Withdrawal Phase
Replies: 27
Views: 1908

Valuation of Value, Quality, Small; assets in Momentum

It's relatively simple to assess valuations for market indexes. For example, we can compare current CAPE to historical CAPE. (“Valuation” in this case shows 10 year return if CAPE reverts halfway to historical mean.) But is there a free, easy, and sensible way to gauge valuations for Value Quality /...
by lazyday
Sat Feb 07, 2015 4:48 am
 
Forum: Investing - Theory, News & General
Topic: Valuation of Value, Quality, Small; assets in Momentum
Replies: 0
Views: 191

Allocation to UK vs US

Some of us make portfolio changes in response to large changes in valuations. Today one might consider moving some equity from US to UK. Year end valuations: http://www.researchaffiliates.com/AssetAllocation/Pages/Equities.aspx (Since 12/31, UK equity has performed in line with developed Europe and ...
by lazyday
Sat Feb 07, 2015 4:33 am
 
Forum: Investing - Theory, News & General
Topic: Allocation to UK vs US
Replies: 2
Views: 330

Re: Next decade outlook from Vanguard CEO

There's also early 1980s to 2000.
by lazyday
Sat Feb 07, 2015 3:06 am
 
Forum: Investing - Theory, News & General
Topic: Next decade outlook from Vanguard CEO
Replies: 17
Views: 2100

Re: Global Minimum Volatility?

I've argued in the past that for the person who holds, say, a 90/10 portfolio and wants less risk, the best way to do that by far is to add bonds as opposed to low volatility stocks. I suspect this is more true for someone who views risk as volatility than for someone most concerned with shortfall ...
by lazyday
Sat Feb 07, 2015 2:52 am
 
Forum: Investing - Help with Personal Investments
Topic: Global Minimum Volatility?
Replies: 40
Views: 3119

Re: Foreign Stocks in Taxable - Gotcha w/ foreign tax credit

as long as US taxes are less than foreign taxes, you have the same net tax liability regardless of whether a foreign asset is held in a taxable account or in an IRA. Say you are paid a foreign nonqualified dividend in an IRA, for $1 - 60% foreign tax = .40. When you withdraw the 40 cents, you then ...
by lazyday
Fri Feb 06, 2015 1:40 pm
 
Forum: Investing - Theory, News & General
Topic: Foreign Stocks in Taxable - Gotcha w/ foreign tax credit
Replies: 58
Views: 7482

Re: Are TIPS the ultimate inflation hedge?

tarnation wrote:myRA. (worst named program ever)

Should have called it "iRA". no, wait...
by lazyday
Wed Feb 04, 2015 11:30 am
 
Forum: Investing - Theory, News & General
Topic: Are TIPS the ultimate inflation hedge?
Replies: 27
Views: 2139

Re: Why no talk about investing in Timber?

Still not what you're looking for, but DBO tries to reduce the problem of negative roll yield by selecting among several contracts. I don't think they try to differentiate between a low expected price and a cheap contract with better expected roll yield. So if everyone tries something similar, it mi...
by lazyday
Wed Feb 04, 2015 11:20 am
 
Forum: Investing - Theory, News & General
Topic: Why no talk about investing in Timber?
Replies: 14
Views: 1346

Re: Why no talk about investing in Timber?

OIL is an ETN. When I last looked into it, all ETNs had unpaid credit risk.
by lazyday
Wed Feb 04, 2015 10:23 am
 
Forum: Investing - Theory, News & General
Topic: Why no talk about investing in Timber?
Replies: 14
Views: 1346

Re: Vanguard survey: what should they do differently?

- Give us choices to improve account security, even if it requires some hassle.

Already done, thank you!

- Improve processes so fewer mistakes are made
by lazyday
Wed Feb 04, 2015 8:05 am
 
Forum: Investing - Theory, News & General
Topic: Vanguard survey: what should they do differently?
Replies: 72
Views: 4444
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