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Re: What is your commodities stocks/indexes allocation?

Do you own any stocks or indexes that are specifically categorized as commodities? Yes income producing commodities fund What percentage of your goal allocation are made up of commodities? 8% of stocks Has their poor performance caused you to modify this percentage? No Does the current world situat...
by magneto
Fri Jan 23, 2015 11:16 am
 
Forum: Investing - Theory, News & General
Topic: What is your commodities stocks/indexes allocation?
Replies: 20
Views: 1059

Re: Rental investment: Cash or Mortgage?

As suggested above, buy one property (with cash), and see how it goes. When comfortable with managing property (say after twelve months) consider adding further, with or without leverage. Let us assume cost of mortgage is 4% and inflation going forward 2%. Real (after inflation) mortgage cost = 4% -...
by magneto
Wed Jan 21, 2015 6:10 am
 
Forum: Investing - Help with Personal Investments
Topic: Rental investment: Cash or Mortgage?
Replies: 9
Views: 1102

Re: Currency hedged ETFs, worth extra expense?

For bonds; would raise a whole separate range of issues, but if we are talking purely stocks :- If volatility is your friend, providing rebalancing opportunities, then why not welcome the additional volatility provided by currency variations? EDIT : Assuming here that non-core holdings are in specif...
by magneto
Mon Jan 19, 2015 6:03 am
 
Forum: Investing - Theory, News & General
Topic: Currency hedged ETFs, worth extra expense?
Replies: 5
Views: 460

Re: Year-end financial statements?

Before I knew what an IPS was, put together at the end of each a year a Review of Investments. Contents + Asset Class Allocations; with their real yields and thoughts on possible changes in the light of the real yields noted and other factors. Also background financial information and comments on th...
by magneto
Sun Jan 18, 2015 2:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: Year-end financial statements?
Replies: 5
Views: 574

Re: Anti- Market Timers still seem to endorse market-timing?

It's interesting that the consensus and evidence seems to support momentum rather than contrarianism. That's the opposite of what I would have expected. One thing missing from this discussion so far : VALUATIONS . When a momentum investor is selling, a value investor may be buying. Remember also :-...
by magneto
Fri Jan 16, 2015 5:53 am
 
Forum: Investing - Theory, News & General
Topic: Anti- Market Timers still seem to endorse market-timing??
Replies: 22
Views: 2766

Re: I see rental properties as bonds. Am I completely off b

Interesting thinking OP. As I see it, with real estate included, you have a porfolio that is part illiquid and part liquid. The liquid part IMHO is the part where stock/bonds/cash decisions arise. Cash becomes more important as an asset if holding residential real estate, as sudden calls for money c...
by magneto
Fri Jan 09, 2015 6:55 am
 
Forum: Investing - Theory, News & General
Topic: I see rental properties as bonds. Am I completely off base?
Replies: 28
Views: 2410

Re: Should you buy foreign stocks because they're cheaper?

Not sure foreign stocks are cheaper. Here are world market caps % and PEs (PE1) as of late Dec 2014, [with mkt cap% Dec 2009] :- Dec 2014 (PE) [Dec 2009] USA 58.34% (18.21) [47.77%] Japan 7.90% (21.35) [9.72%] UK 7.87% (15.70) [10.30%] Canada 3.93% [4.83%] Eurofirst 300 (20.02) France 3.63% (25.66) ...
by magneto
Wed Jan 07, 2015 11:21 am
 
Forum: Investing - Theory, News & General
Topic: Should you buy foreign stocks because they're cheaper?
Replies: 4
Views: 1073

Re: Preparing your assets for your inheritors, simplify?

When preparing IPS suggest it be split in two :- 1. Current portfolio philosopy : as simple or as complex as wished, with explanatory notes. 2. Simple 2 or 3 fund portfolio : to be used by heirs should they not wish, or not be capable of handling option 1. Option 1 could be aimed at handing over the...
by magneto
Tue Jan 06, 2015 11:45 am
 
Forum: Investing - Help with Personal Investments
Topic: Preparing your assets for your inheritors, simplify?
Replies: 9
Views: 1518

Re: "The Most Successful Investors Leave Their Money Alone"

Some thoughts :- "SigFig finds that investors who trade frequently — defined as " investors who have a turnover amount equal to or greater than their portfolio value in a year " — actually see lower returns than their peers who are more hands-off." 1. Surely a select bunch of idi...
by magneto
Mon Jan 05, 2015 11:37 am
 
Forum: Investing - Theory, News & General
Topic: "The Most Successful Investors Leave Their Money Alone"
Replies: 30
Views: 5370

Re: Rick Ferri looking to internationalize his portfolio

Very much regret that the thread has moved into the blind alley of trying to define 'market timing'. More useful and actionable when they appear are the diverse opinions, from the many learned and talented posters here on BH, as to how portfolios might be constructed and why, esp with regard to geog...
by magneto
Sat Jan 03, 2015 5:55 am
 
Forum: Investing - Theory, News & General
Topic: Rick Ferri looking to internationalize his portfolio
Replies: 296
Views: 36112

Re: Rick Ferri looking to internationalize his portfolio

Some numbers re world market cap, etc :- Dec 2014 (PE) [Dec 2009] USA 58.34% (18.21) [47.77%] Japan 7.90% (21.35) [9.72%] UK 7.87% (15.70) [10.30%] Canada 3.93% [4.83%] Eurofirst 300 (20.02) France 3.63% (25.66) [5.24%] Switzerland 3.52% [3.70%] Germany 3.45% (17.34) [3.86%] Australia 2.75% (19.82) ...
by magneto
Fri Jan 02, 2015 11:48 am
 
Forum: Investing - Theory, News & General
Topic: Rick Ferri looking to internationalize his portfolio
Replies: 296
Views: 36112

Re: Doesn't the US already have a wealth tax in effect?

Quote from Guardian newspaper :- “According to the Credit Suisse global wealth report, a person needs just $3,650 – including the value of equity in their home – to be among the wealthiest half of world citizens. However, more than $77,000 is required to be a member of the top 10% of global wealth h...
by magneto
Fri Jan 02, 2015 6:13 am
 
Forum: Investing - Theory, News & General
Topic: Doesn't the US already have a wealth tax in effect?
Replies: 21
Views: 1622

Re: Why Does The 60/40 Work So Well?

Warren Buffet is suggesting for his heirs if recollected correctly :- 10% short term bonds 90% US Stocks (S&P500) uncertain about his rebalancing We use Dynamic Asset Allocation at present, varying stock percentage dependent on valuations, with progressive part rebalancing each month/quarter. Ho...
by magneto
Tue Dec 30, 2014 6:18 am
 
Forum: Investing - Help with Personal Investments
Topic: Why Does The 60/40 Work So Well?
Replies: 31
Views: 4800

Re: Dividend Growth Investing Vs. 3F portfolio

Where is the evidence that humans are better at selecting dividend appreciation stocks (or any other kind for that matter) than computers are? You are saying that humans can somehow intervene to prevent underperformance? If so, why can't humans program a computer to perform that same intervention?[...
by magneto
Wed Dec 24, 2014 6:13 pm
 
Forum: Investing - Theory, News & General
Topic: Dividend Growth Investing Vs. 3F portfolio
Replies: 25
Views: 3125

Re: Dividend Growth Investing Vs. 3F portfolio

Dividend Aristocrat type funds suffer from the drawback that a computer is making choices with little or no human input, and the tilt to yield can as noted be accompanied by TR underperformance. No, the real "drawback" is that dividend funds have an audited record and have to suffer from ...
by magneto
Wed Dec 24, 2014 12:05 pm
 
Forum: Investing - Theory, News & General
Topic: Dividend Growth Investing Vs. 3F portfolio
Replies: 25
Views: 3125

Re: Dividend Growth Investing Vs. 3F portfolio

Picking up on some well made points :- Don't think there is a clear correct answer to this one. Stock prices are driven by sentiment perhaps as much as by fundamentals. There are times when sentiment drives stocks to fully priced (think 1999) and selling stocks makes sense. The reverse can be true a...
by magneto
Wed Dec 24, 2014 11:50 am
 
Forum: Investing - Theory, News & General
Topic: Dividend Growth Investing Vs. 3F portfolio
Replies: 25
Views: 3125

Re: Dividend Growth Investing Vs. 3F portfolio

Don't think there is a clear correct answer to this one. Stock prices are driven by sentiment perhaps as much as by fundamentals. There are times when sentiment drives stocks to fully priced (think 1999) and selling stocks makes sense. The reverse can be true at other times (think 2008/9). The inves...
by magneto
Tue Dec 23, 2014 11:36 am
 
Forum: Investing - Theory, News & General
Topic: Dividend Growth Investing Vs. 3F portfolio
Replies: 25
Views: 3125

Re: Why would you invest in a bond fund?

The choice really is between bonds and cash, not adding further to stocks. Then the key question would be what is the real (after inflation) bond yield. Depending on the investor's view of expected inflation, should the real yield calculate negative, then in real terms the investor is paying the gov...
by magneto
Wed Dec 17, 2014 11:55 am
 
Forum: Investing - Theory, News & General
Topic: Why would you invest in a bond fund?
Replies: 25
Views: 2237

Re: How to best use upcoming windfall?

We stand to receive over $600,000 after taxes and fees. We owe about $90,000 on a HELOC (prime+0.25%) and $450,000 on a first mortgage at 3.8%, fixed for 30 years. We have no other outstanding debt, cars and paid off, etc. My question is how to best use this windfall. I know that many would suggest...
by magneto
Mon Dec 15, 2014 11:56 am
 
Forum: Investing - Help with Personal Investments
Topic: How to best use upcoming windfall?
Replies: 9
Views: 1362

Re: Investing more when the market is down.

I have a hard time wrapping my head around this. When the market is down everyone agrees it's a good time to invest. "I'm buying stocks at a bargain price". ..... But I can't see how this isn't "timing the market" and thus should be against Boglehead principles. If you strongly ...
by magneto
Sun Dec 14, 2014 11:33 am
 
Forum: Investing - Theory, News & General
Topic: Investing more when the market is down.
Replies: 22
Views: 2343

Re: Harvey paper says re-balancing adds risk

Find the theory around rebalancing confusing, and this thread enlightening in the conflict between value and momentum. Presumably the momentum investor will be buying as asset class rises, while the value investor will be selling? Definitely raises a dilemma about rebalancing? Long ago in pre BH day...
by magneto
Wed Dec 10, 2014 11:44 am
 
Forum: Investing - Theory, News & General
Topic: Harvey paper says re-balancing adds risk
Replies: 73
Views: 5096

Re: What to do with VGPMX?

If I sell VGPMX at a loss, I will have taken the risk without getting the reward. The long term return of gold tends to be zero, when adjusted for inflation. That's why I invested in a fund of miners, which pay dividends, instead of physical gold or a gold ETF. As only 5% invested in the fund, hope...
by magneto
Tue Dec 09, 2014 11:23 am
 
Forum: Investing - Help with Personal Investments
Topic: What to do with VGPMX (Vanguard Precious Metals and Mining)?
Replies: 40
Views: 4000

Re: How do you rebalance?

I am not 'special' :happy ; but do rebalance differently from the main options listed. Not happy with bands or time in isolation. Prefer using both deviation and time! Why ignore one or the other? Approach the stock target at a controlled rate say 10% or 20% of deviation from target per quarter. Thi...
by magneto
Wed Dec 03, 2014 5:57 am
 
Forum: Investing - Theory, News & General
Topic: How do you rebalance?
Replies: 40
Views: 3267

Re: Helping adult child understand investing

We have a similar problem. Some possible avenues we are mulling over :- 1. Set up an account in their name, and deposit some funds. Then make investment decisions together. 2. Show own IPS (and annual reports if done), and ask for comments/suggestions. This almost certainly won't get off the ground ...
by magneto
Mon Dec 01, 2014 11:43 am
 
Forum: Personal Finance (Not Investing)
Topic: Helping adult child understand investing
Replies: 38
Views: 3413

Re: I'm getting Slaughtered in stocks

The other little secret of individual stock investing is that the more stocks you pick assuming that one diversifies across industry sectors, the less likely you will outperform the broad indexes. That is because your sample gets to bigger and bigger and statistically that means your sample gets to...
by magneto
Sat Nov 29, 2014 2:42 pm
 
Forum: Investing - Theory, News & General
Topic: I'm getting Slaughtered in stocks
Replies: 43
Views: 6100

Re: Need for Int'l Investing

Some information re iShares global fund allocations :-

Nov 2014 (Dec 2009)
--------------------------------
USA 56.66% (47.77%)
Japan 8.23% (9.72%)
UK 6.99% (10.30%)
Canada 3.86% (4.83%)
France 3.65% (5.24%)
Australia 3.15% (3.97%)
by magneto
Wed Nov 26, 2014 11:18 am
 
Forum: Investing - Help with Personal Investments
Topic: Need for Int'l Investing
Replies: 12
Views: 1086

Re: Shiller CAPE 10 — Why So High These Days?

G Whizz, This is a commonly repeated misconception (dare I say straw man) about those who take serious note of market valuations :- "Those who have stayed in cash waiting on the sidelines for PE10 to correct to historically attractive levels before entering the market have in the last 5 years m...
by magneto
Wed Nov 26, 2014 10:48 am
 
Forum: Investing - Theory, News & General
Topic: Shiller CAPE 10 — Why So High These Days?
Replies: 38
Views: 3590

Re: Shiller CAPE 10 — Why So High These Days?

Good thoughtful thread SG. Following link which adds q to the chart, seems to corroborate CAPE. http://www.smithers.co.uk/page.php?id=34 The periods of low valuations in original post seem to be ascribed to 'unusual times'. Are we now clear of 'unusual times'? The thirties depression it is argued wa...
by magneto
Wed Nov 26, 2014 6:12 am
 
Forum: Investing - Theory, News & General
Topic: Shiller CAPE 10 — Why So High These Days?
Replies: 38
Views: 3590

Re: Been out of market since 2008 and can't get back in

There are two problems here :- 1. You think the market is expensive. 2. In spite of being expensive you want to buy some stocks. Nisi recommends gradualism. Concur. If in addition you are going to take note of market valuations, then the following may assist :- 1. Set a target stock % proportional t...
by magneto
Tue Nov 25, 2014 11:55 am
 
Forum: Investing - Help with Personal Investments
Topic: Been out of market since 2008 and can't get back in
Replies: 52
Views: 5458

Re: Using Bond Funds for market pullbacks

That's not the worst. The worst is that the market drops down much further and stays there, meaning that your eagerness cost you a significant chunk of the portfolio, either money you have to tap into or money you could have used to buy equities much cheaper. +1 If you are going to do this sort of ...
by magneto
Sat Nov 22, 2014 2:16 pm
 
Forum: Investing - Theory, News & General
Topic: Using Bond Funds for market pullbacks
Replies: 19
Views: 841

Re: portfolio suggestions for the truly aged.

I would look at this from the point of view that she might need cash in the near future if she loses her independence. Also, funds needed within 5 years should not be in the market. I would be inclined to keep not more than 25% in mutual funds in the IRA. Knowing her taxable holdings would potentia...
by magneto
Sat Nov 22, 2014 5:57 am
 
Forum: Investing - Help with Personal Investments
Topic: portfolio suggestions for the truly aged.
Replies: 20
Views: 2950

Re: I may not make my retirement goals! What to do?

Picking up on posts above; herewith recent comments from Jeremy Grantham, with which we would not choose to differ :- "Given his bearish outlook, it is unsurprising that Grantham urges investors to think very carefully about how they build their portfolios in the current environment. “As always...
by magneto
Wed Nov 19, 2014 11:36 am
 
Forum: Investing - Help with Personal Investments
Topic: I may not make my retirement goals! What to do?
Replies: 49
Views: 4165

Re: I may not make my retirement goals! What to do?

It appears that the issue revolves around my stock allocation (all in a world stock ETF), which seems too low, 27%. Further, it also seems that when I increase it to about 35% things look much better. I am willing to change my original plans (25 to 30% in stocks) and increase the stock allocation s...
by magneto
Wed Nov 19, 2014 6:28 am
 
Forum: Investing - Help with Personal Investments
Topic: I may not make my retirement goals! What to do?
Replies: 49
Views: 4165

Re: One Source to follow world markets ?

Try Marketwatch if you can resist over-trading. "If you can keep your head when all about you Are losing theirs and blaming it on you, If you can trust yourself when all men doubt you," "If you can make one heap of all your winnings And risk it on one turn of pitch-and-toss, And lose,...
by magneto
Mon Nov 17, 2014 5:49 am
 
Forum: Investing - Theory, News & General
Topic: One Source to follow world markets ?
Replies: 26
Views: 1959

Re: Strategies to protect retirement from depressn or long b

In 'The Great Depression (A Diary)', Benjamin Roth gives his thoughts on just such a scenario. Those with Gov't Bonds seemed to be sitting pretty, but probably (haven't checked) yields were better in 1929. In view of 2014 yields, Rental Real Estate (RRE) of durable construction ( without debt ) is a...
by magneto
Thu Nov 13, 2014 11:23 am
 
Forum: Investing - Theory, News & General
Topic: Strategies to protect retirement from depressn or long bear?
Replies: 33
Views: 4321

Re: Investing Advice on the Radio - Wish they would go away

Last night my wife told me that we needed a financial adviser because she heard someone on the radio talking about a tax free account where you could sock away a bunch of money post tax and be a gazillionaire at retirement. Because I listen to this station a lot more than she does I have a pretty g...
by magneto
Thu Nov 13, 2014 10:58 am
 
Forum: Personal Finance (Not Investing)
Topic: Investing Advice on the Radio - Wish they would go away
Replies: 22
Views: 2578

Re: Why would a European bother holding bonds in this climat

The only risk free bonds are the German ones. If the Euro breaks up we have to presume that the German government would pay, and the new DM would be a strong currency. The US has the largest and most liquid government bond market in the world (? Japan?). And for all intents and purposes it is defau...
by magneto
Thu Nov 13, 2014 5:35 am
 
Forum: Investing - Theory, News & General
Topic: Why would a European bother holding bonds in this climate?
Replies: 19
Views: 1945

Re: How can I convince my wife to accept investing??

I am having trouble with my wife who doesn't want me to invest. She wants to just save money in savings accounts. When I try to explain her this is not enough, she blocks her ears. Are there others having the same problems? What should I do?? Hi there and welcome, Most here tend towards deciding an...
by magneto
Wed Nov 12, 2014 11:52 am
 
Forum: Investing - Help with Personal Investments
Topic: How can I convince my wife to accept investing??
Replies: 54
Views: 5496

Re: Sunday morning musing - dividend stocks

Dividend stocks can be a tempting trap for the unwary, but you seem to be doing just fine. Some ETFs offering high yield don't seem to carry out any sort of checks to determine the sustainability of the dividends! Just picking the highest yielders! Others, that use computer screening for dividend su...
by magneto
Sun Nov 09, 2014 2:24 pm
 
Forum: Investing - Theory, News & General
Topic: Sunday morning musing - dividend stocks
Replies: 11
Views: 1289

Re: Why are people so down on bonds?

For the last few decades bonds- defined as short-intermediate term high quality fixed income, did two things for one's portfolio: 1. They dampened the volatility of a portfolio and provided a store of value to buy stocks when they went on sale. 2. They could reasonably be counted on to provide a po...
by magneto
Sun Nov 09, 2014 11:09 am
 
Forum: Investing - Theory, News & General
Topic: Why are people so down on bonds?
Replies: 39
Views: 6565

Re: Cash - Throw it on the table!

I look at cash not for a return anymore as a result of interest rates (unfortunately), but rather peace of mind, a mental form of insurance, liquidity, etc. This is an open ended thread with a request to elaborate and expand on the topic of cash. So please, any and all thoughts, perspectives, are w...
by magneto
Wed Nov 05, 2014 11:39 am
 
Forum: Personal Finance (Not Investing)
Topic: Cash - Throw it all on the table!!!
Replies: 51
Views: 3980

Re: "Should You Be a Dividend Stock Investor?"

First ; Very much in favor of total return investing. If the retiree needs a steady flow of dividends, this is one of those rare occasions where some human intervention, to think carefully and assess forward dividend sustainability, can add value. Some ETFs claim to do this, but remain dubious. Is ...
by magneto
Mon Nov 03, 2014 11:45 am
 
Forum: Investing - Theory, News & General
Topic: "Should You Be a Dividend Stock Investor?"
Replies: 33
Views: 3499

Re: "Should You Be a Dividend Stock Investor?"

First ; Very much in favor of total return investing. However would point out that for a retiree in a prolonged market downturn, it is painful to be forced to sell stocks at distressed prices, merely to satisfy current income needs. Some slight, repeat slight, tilt to yield could augment the necessa...
by magneto
Sat Nov 01, 2014 2:43 pm
 
Forum: Investing - Theory, News & General
Topic: "Should You Be a Dividend Stock Investor?"
Replies: 33
Views: 3499

Re: Total World Fund - Under appreciated?

Generally Total World fine. Good portfolio core, esp for non US investors. There are however situations where caution is needed, e.g. holding high weighting Japan 1989 See one point of view from UK :- http://www.irateinvestment.com/2014/04/04/dark-side-of-index-trackers/ "But the risk is not ju...
by magneto
Fri Oct 31, 2014 11:13 am
 
Forum: Investing - Help with Personal Investments
Topic: Total World Fund - Under appreciated?
Replies: 26
Views: 3100

Re: "Schwab Intelligent Portfolios"

"Schwab’s computer algorithm is going to suggest and manage a portfolio of ETFs for you."

Hmmm.

Where does 'intelligent' come in?
by magneto
Thu Oct 30, 2014 11:34 am
 
Forum: Investing - Theory, News & General
Topic: "Schwab Intelligent Portfolios"
Replies: 60
Views: 10379

Re: Shiller CAPE Ratio

Another poster was kind enough to share this link.

http://www.starcapital.de/research/stoc ... Shiller_PE
by magneto
Wed Oct 29, 2014 5:36 am
 
Forum: Investing - Help with Personal Investments
Topic: Shiller CAPE Ratio
Replies: 3
Views: 535

Re: Would You Sell Or Continue Renting Out My Condo?

If we separate out the debt from the property and apply it to the whole portfolio, then portfolio looks something like :- Stocks/Bonds 26% (RealYields 2.00% / and 2.21% - infl = -0.35% respectively) Cash 14% (Real Yield est 2.00% - infl = -0.5%) Property 60% (Real Yield 4-5%) Leverage 43% (Real Cost...
by magneto
Tue Oct 28, 2014 5:31 am
 
Forum: Personal Finance (Not Investing)
Topic: Would You Sell Or Continue Renting Out My Condo?
Replies: 27
Views: 3608

Re: Would You Sell Or Continue Renting Out My Condo?

The answer hinges on what the rest of your portfolio looks like.
by magneto
Mon Oct 27, 2014 5:50 am
 
Forum: Personal Finance (Not Investing)
Topic: Would You Sell Or Continue Renting Out My Condo?
Replies: 27
Views: 3608

Re: Rebalancing question [Currency exchange rate differences

The reason I ask is because to account for exchange rate fluctuations would mean far too much activity, and we all like to keep transaction costs at a minimum. But to ignore the exchange rate, often means that I don't take advantage of the price changes which are the cornerstone of asset allocation...
by magneto
Mon Oct 27, 2014 5:20 am
 
Forum: Investing - Theory, News & General
Topic: Rebalancing question [Currency exchange rate differences]
Replies: 12
Views: 899

Re: Rebalancing question [Currency exchange rate differences

Not sure fully grasp the question. When the investor reviews their portfolio, all the portfolio components to make any sense will need to be shown in his/her domestic currency. So if some components happen to be in a foreign (non-domestic) currency , they need to be converted back to the domestic cu...
by magneto
Sun Oct 26, 2014 11:21 am
 
Forum: Investing - Theory, News & General
Topic: Rebalancing question [Currency exchange rate differences]
Replies: 12
Views: 899
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