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Re: Spouse not ready to cut ties with financial advisers

There should be agreement between spouses about financial matters. I agree that the Original Poster should not steamroll her husband in moving everything to Vanguard. We have to remember who the $3 million belongs to Miakis and her husband. We are telling them what they CAN do with their funds but n...
by nedsaid
Sun Aug 17, 2014 7:29 pm
 
Forum: Investing - Help with Personal Investments
Topic: Spouse not ready to cut ties with financial advisers
Replies: 94
Views: 5847

Re: WSJ: Is Your Portfolio Too Diversified?

There is a point where adding more asset classes doesn't add anything in return. The goal is to boost returns a bit and hopefully smooth out the ride. I could see a scenario in which just adding asset classes could decrease returns and actually increase volatility. Some thought has to go into this, ...
by nedsaid
Sun Aug 17, 2014 2:23 pm
 
Forum: Investing - Theory, News & General
Topic: WSJ: Is Your Portfolio Too Diversified?
Replies: 23
Views: 3061

Re: Spouse not ready to cut ties with financial advisers

Some perspective is in order. First of all, you have done well. A $3 million portfolio is the envy of most people, even Bogleheads. Miakis, you seem to be a level headed and competent individual. You benefitted from a rising stock market the last five years. So the situation you are presenting is ac...
by nedsaid
Sun Aug 17, 2014 2:02 pm
 
Forum: Investing - Help with Personal Investments
Topic: Spouse not ready to cut ties with financial advisers
Replies: 94
Views: 5847

Re: Shiller on Lofty Market Elevations

All other things being equal, stock valuations are higher when interest rates are low. This is a big reason we are seeing elevated price/earnings ratios. In bull markets, stocks always look expensive. In bear markets, stocks always look dangerous. I believe that stock prices are richly valued but we...
by nedsaid
Sun Aug 17, 2014 11:36 am
 
Forum: Investing - Theory, News & General
Topic: Shiller on Lofty Market Elevations
Replies: 55
Views: 4777

Re: Help understanding tibs (similar to i-bonds)

I looked at your link, it appears that your market interest rates in Australia are more like 3-4%. The 6 percent coupon you were seeing were on older bonds that are ready to mature. I would be very surprised if you could get a market rate of 6%. The coupon rate isn't what you are really getting as I...
by nedsaid
Sun Aug 17, 2014 11:27 am
 
Forum: Investing - Theory, News & General
Topic: Help understanding tibs (similar to i-bonds)
Replies: 6
Views: 479

Re: Help understanding tibs (similar to i-bonds)

If you live in Australia and spend in Aussie Dollars, this sounds like a good deal to me. I am unaware of inflation rates in Australia but 6% on a government bond sounds pretty darned good to me. I assume these operate like TIPS, where you get a stated interest rate plus the inflation adjustment. Th...
by nedsaid
Sun Aug 17, 2014 11:22 am
 
Forum: Investing - Theory, News & General
Topic: Help understanding tibs (similar to i-bonds)
Replies: 6
Views: 479

Re: Spouse not ready to cut ties with financial advisers

Wow, no wonder why you have been pleased with your investment results. You have a 100% stock portfolio which would have done great since the stock market has been strong for 5 years now. Your portfolio appears to be aggressive even for a 100% stock portfolio. You have been L-U-C-K-Y. I just can't im...
by nedsaid
Sun Aug 17, 2014 11:14 am
 
Forum: Investing - Help with Personal Investments
Topic: Spouse not ready to cut ties with financial advisers
Replies: 94
Views: 5847

Re: Help understanding tibs (similar to i-bonds)

If you are a US investor buying Aussie bonds, you are taking on currency risk. If the US Dollar/Aussie Dollar maintain a stable price relationship, you will make out like a bandit effortlessly collecting the 6 percent. However, if the US Dollar significantly increased in value versus the Aussie Doll...
by nedsaid
Sun Aug 17, 2014 10:46 am
 
Forum: Investing - Theory, News & General
Topic: Help understanding tibs (similar to i-bonds)
Replies: 6
Views: 479

Re: Do Super wealthy have access to different investing vehi

The super wealthy would have more opportunity to invest in private equity or to even purchase privately held companies. There is also better access to hedge funds which I believe guarantee higher fees and not necessarily better performance. A very wealthy person could amass his or her own real estat...
by nedsaid
Sun Aug 17, 2014 10:39 am
 
Forum: Investing - Theory, News & General
Topic: Do Super wealthy have access to different investing vehicles
Replies: 76
Views: 6169

Re: 'Risk Creep' - new term

I believe that "risk creep" is a problem for all of us. Professional investors are subject to the same exact problem, even Target Date Retirement Funds seem to be increasing their allotment of stocks in their portfolios. Right now two things are causing this. Low interest rates and reachin...
by nedsaid
Sun Aug 17, 2014 10:30 am
 
Forum: Investing - Theory, News & General
Topic: 'Risk Creep' - new term
Replies: 26
Views: 2147

Re: Market Timing?

I advocate taking advantage of extremes of market sentiment and valuations but only at the margins. I would never sell all my stocks, probably at most I would sell 30% of my stocks in a market euphoria. In 2000, I sold about 15% of my stocks and took this to cash. In 2008-2009, I was too scared to r...
by nedsaid
Sat Aug 16, 2014 11:04 am
 
Forum: Investing - Theory, News & General
Topic: Market Timing?
Replies: 20
Views: 1224

Re: “The more I learn, the more I realize how much I don't k

I have used the golf analogy to investing. Many a good athlete has been humbled by golf. There are all kinds of very smart people who have been humbled by investing. Do the right things and do them consistently as an investor and you will succeed. But yes, I have to admit that I realize how little I...
by nedsaid
Sat Aug 16, 2014 10:53 am
 
Forum: Investing - Help with Personal Investments
Topic: “The more I learn, the more I realize how much I don't know"
Replies: 18
Views: 1909

Re: “The more I learn, the more I realize how much I don't k

If you are going to err, it is best to err on the side of conservatism. With a five year bull run in the stock market, a lot of us are feeling pretty frisky. But bad things can happen to good people in the stock market. Since 2000, we have seen two declines of 50% or more in the broad US Stock Marke...
by nedsaid
Fri Aug 15, 2014 10:41 pm
 
Forum: Investing - Help with Personal Investments
Topic: “The more I learn, the more I realize how much I don't know"
Replies: 18
Views: 1909

Re: International and Emerging Markets Small Cap Value

Livesoft, I liked very much the article that you linked to. Thanks for posting. WOW, a lot of asset classes listed there. More than what I would consider but the article is a great source of information.
by nedsaid
Mon Aug 11, 2014 3:45 pm
 
Forum: Investing - Help with Personal Investments
Topic: International and Emerging Markets Small Cap Value
Replies: 8
Views: 968

Re: So where's that inflation many forecasted?

Yes, there is that moral hazard problem. I would get around the "too big to fail" problem by breaking up the big banks. Tell them to break themselves up by geography or lines of business. If you want to be a big mega-bank that does everything, then be a regional bank. If you want to be a n...
by nedsaid
Mon Aug 11, 2014 3:38 pm
 
Forum: Investing - Theory, News & General
Topic: So where's that inflation many forecasted?
Replies: 43
Views: 2601

Re: Who or what inspired you and your investing approach?

I was also influenced by Andrew Tobias. His book was one of the first investment books that I read.
by nedsaid
Mon Aug 11, 2014 3:32 pm
 
Forum: Personal Finance (Not Investing)
Topic: Who or what inspired you and your investing approach?
Replies: 93
Views: 4276

Re: So where's that inflation many forecasted?

There isn't any one economic school of thought that explains everything. By nature, I am probably more in the Austrian camp. I am suspicious that models can predict everything, as in investing I believe that economics is largely behavioral. My thinking was also influenced by Milton Friedman and mone...
by nedsaid
Mon Aug 11, 2014 3:22 pm
 
Forum: Investing - Theory, News & General
Topic: So where's that inflation many forecasted?
Replies: 43
Views: 2601

Re: Dividend Strategy Ain't For Everyone

If my portfolio was large enough, I certainly would exercise an income strategy taking the income from dividends and interest. But I don't and probably won't, so a combination of annuitizing a portion of my nest egg and a total return strategy with the rest is probably what I will do in retirement. ...
by nedsaid
Mon Aug 11, 2014 2:53 pm
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10504

Re: Dave Ramsey still defending 12% and still angry at "nerd

I actually like Dave Ramsey and I believe that most of his advice is sound. His investment advice is not the best. My house of worship has sponsored Dave Ramsey classes a couple of times. I went to an introductory session but decided against taking the set of classes. First, I didn't want to face th...
by nedsaid
Mon Aug 11, 2014 2:43 pm
 
Forum: Investing - Theory, News & General
Topic: Dave Ramsey still defending 12% and still angry at "nerds"
Replies: 194
Views: 22327

Re: So where's that inflation many forecasted?

There are at least a couple of reasons for the low inflation. First, there is still a lot of unused capacity in the economy. The labor participation rate is still low even though the unemployment numbers look better. Second is the low velocity of money. There is a lot of cash on the balance sheets o...
by nedsaid
Mon Aug 11, 2014 2:07 pm
 
Forum: Investing - Theory, News & General
Topic: So where's that inflation many forecasted?
Replies: 43
Views: 2601

Re: Endowments: Paying for complexity or performance?

I think part of this is snob appeal. A lot of foundation boards would be appalled if all the investment manager did was take the endowment and invest it in Vanguard Index Funds. Particularly at a place like Harvard or Yale where the thinking is to hire the very best people. Passive investing would s...
by nedsaid
Sun Aug 10, 2014 11:54 am
 
Forum: Investing - Theory, News & General
Topic: Endowments: Paying for complexity or performance?
Replies: 14
Views: 1049

Re: Aggressive asset allocation as a temporary measure [Spai

First, get over the thoughts that you "need" a certain rate of return on your investments. The markets will return what they will return and don't care at all about your needs and your own personal financial situation. What you have to do is to invest in the most rational way that you can....
by nedsaid
Sun Aug 10, 2014 11:39 am
 
Forum: Investing - Help with Personal Investments
Topic: Aggressive asset allocation as a temporary measure [Spain]
Replies: 7
Views: 587

Re: Endowments: Paying for complexity or performance?

I hope Nisiprius didn't hit the "invest" button. I wonder what the overdraft charges would be on a $32 billion fund purchase?
by nedsaid
Sun Aug 10, 2014 11:29 am
 
Forum: Investing - Theory, News & General
Topic: Endowments: Paying for complexity or performance?
Replies: 14
Views: 1049

Re: "The Cost of Chasing Returns" from St Louis Fed

I have also seen articles that state that most 401k investors stayed put during the 2008-2009 financial crisis and bear market. Investors certainly do performance chase but I often think the investing public isn't as dumb as what is often portrayed. Certainly there is conflicting information out the...
by nedsaid
Sun Aug 10, 2014 11:24 am
 
Forum: Investing - Theory, News & General
Topic: "The Cost of Chasing Returns" from St Louis Fed
Replies: 6
Views: 861

Re: Dave Ramsey still defending 12% and still angry at "nerd

What does bother me with Dave Ramsey and the 12% is that he realizes that he has been caught in a mistake and will not own up to it. If you listened carefully to Dave, reading between the lines he admits his error but is angry at the nerds for pointing it out. It is a bit like the Beardstown ladies ...
by nedsaid
Sun Aug 10, 2014 11:14 am
 
Forum: Investing - Theory, News & General
Topic: Dave Ramsey still defending 12% and still angry at "nerds"
Replies: 194
Views: 22327

Re: Dividend Strategy Ain't For Everyone

Why do people keep saying that dividend investors are naïve and think that dividends are somehow free money that the market doesn't know about? Yes, I am aware that the price of a stock will normally drop when the stock goes ex-dividend by the amount of the dividend. This happens unless there is som...
by nedsaid
Sun Aug 10, 2014 10:59 am
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10504

Re: Who or what inspired you and your investing approach?

In high school and college I watched Wall Street Week with Louis Rukeyser. I determined that when I could afford to invest that I wanted an investment portfolio. About 1987, a good friend of mine decided to go into the brokerage business. He had a Money Magazine All-Star broker as his broker and tha...
by nedsaid
Sat Aug 09, 2014 1:38 am
 
Forum: Personal Finance (Not Investing)
Topic: Who or what inspired you and your investing approach?
Replies: 93
Views: 4276

Re: Dividend Strategy Ain't For Everyone

Of the individual stocks that I have owned, most have paid dividends. But I have owned stocks that don't pay dividends too. My preference is to own dividend payers but it is not a religion with me. I also own pretty aggressive mutual funds based on earnings and price momentum. These funds often pay ...
by nedsaid
Fri Aug 08, 2014 11:29 pm
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10504

Re: Dividend Strategy Ain't For Everyone

I would like to set the record straight, I have never said that a total return approach is bunk. All I was saying is that this is not a 100% foolproof strategy. This approach has problems in a scenario of a bear market right after an investor's retirement. It is the sequence of returns problem. In a...
by nedsaid
Fri Aug 08, 2014 11:12 pm
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10504

Re: Dividend Strategy Ain't For Everyone

Yes a dividend strategy is a lot like a buckets strategy. The idea is to not sell your stocks in down markets. People will say this is mental accounting. Well, I say whatever works to keep people in the stock market even when things look bad. Nothing destroys the returns of a portfolio like selling ...
by nedsaid
Thu Aug 07, 2014 10:13 pm
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10504

Re: ? Best simple reference to dissuade a day trader

Jack, I know a heck of a lot about investing. I have worked with different people in the financial industry with my investments and I have invested through several investment firms. I have owned individual stocks, active mutual funds, index funds, ETF's, zero coupon bonds, and Certificates of Deposi...
by nedsaid
Wed Aug 06, 2014 10:24 pm
 
Forum: Investing - Theory, News & General
Topic: ? Best simple reference to dissuade a day trader
Replies: 67
Views: 4240

Re: Dividend Strategy Ain't For Everyone

JoMoney, thanks for your comments. I am aware that the dividend strategy didn't work in 2008-2009 as companies, particularly financial companies cut their dividends. No strategy is foolproof. I have made the statement many times that all investment strategies fail, the best investment strategies fai...
by nedsaid
Wed Aug 06, 2014 9:52 pm
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10504

Re: Dividend Strategy Ain't For Everyone

The problem with a total return strategy is what do you do when you have no return? Or if you have a negative return? Dollar cost averaging in reverse during a down market can be devastating to a portfolio. Rick Ferri posted that if retired investors could withdraw only the income generated from a p...
by nedsaid
Mon Aug 04, 2014 9:54 pm
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10504

Re: ? Best simple reference to dissuade a day trader

I am skeptical that day trading is as easy as described above, there are Wall Street firms and professional traders doing the same exact thing. The trouble with this type of reasoning is that stocks sometimes go UP on bad news or go DOWN on good news. If the bad news wasn't as bad as the market play...
by nedsaid
Mon Aug 04, 2014 9:41 pm
 
Forum: Investing - Theory, News & General
Topic: ? Best simple reference to dissuade a day trader
Replies: 67
Views: 4240

Re: Do I need a small cap index if I already have total mark

If you have the US Total Market Index you really don't need a small cap index as it is already included. Small caps are about 9% of the US Total Market: 3% Small Value, 3% Small Blend, and 3% Small Growth. I have suggested that an investor might want to couple a Total Stock Market Index with the Ext...
by nedsaid
Mon Aug 04, 2014 9:28 pm
 
Forum: Investing - Theory, News & General
Topic: Do I need a small cap index if I already have total market ?
Replies: 58
Views: 5337

Re: International investing. A good call by our mentor.

Thanks Bobcat2 for your comments. There are a lot of things to think about when constructing a portfolio and currency risk is one of them. I just checking Morningstar, my portfolio is 50% US Stocks, 18% Foreign Stocks, and 32% Bonds and Cash. A bit less than 3% of the portfolio is in Foreign Bonds. ...
by nedsaid
Sun Aug 03, 2014 12:07 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12285

Re: ? Best simple reference to dissuade a day trader

I don't know you can dissuade your friend, it often takes hard experiences in the markets to teach such people a lesson. The problem is that your brain will see random data and want to find order in it. One will fool himself into seeing patterns that don't really exist. That being said, there are pe...
by nedsaid
Sun Aug 03, 2014 10:52 am
 
Forum: Investing - Theory, News & General
Topic: ? Best simple reference to dissuade a day trader
Replies: 67
Views: 4240

Re: Principles for Changing Asset Allocation & Splicing

You need to put on your philosopher's hat and do some hard thinking and then put those thoughts to paper. You need to develop convictions about the economy and the markets and then know yourself as an investor. Here are some thoughts that you might find helpful. First I believe in human progress ove...
by nedsaid
Sun Aug 03, 2014 10:27 am
 
Forum: Investing - Theory, News & General
Topic: Principles for Changing Asset Allocation & Splicing
Replies: 29
Views: 2246

Re: International investing. A good call by our mentor.

I would expect foreign bonds and foreign stocks to behave differently. The biggest difference is that the cash flow of a foreign bond is in one currency and the cash flow of a foreign stock might be in several currencies because of trade. I would expect the effects of currency fluctuations on stocks...
by nedsaid
Sat Aug 02, 2014 8:13 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12285

Re: Ee bonds dated 9/95 through 8/97

Today I cashed in three EE savings bonds purchased 30 years ago. At the time, they had a guaranteed return of 6% and later went to 4% which they continued to earn until they matured. They were purchased for $25 and redeemed at $115.32. Not bad. Too bad I didn't buy more then. I rolled these into I B...
by nedsaid
Sat Aug 02, 2014 7:18 pm
 
Forum: Investing - Help with Personal Investments
Topic: Ee bonds dated 9/95 through 8/97
Replies: 9
Views: 704

Re: International investing. A good call by our mentor.

Currencies are definitely a factor in International Investing. If the dollar declines against the other strong currencies of the world, you will feel the tail winds of the effects of currencies. Declining US dollar adds to your investment return in International Stocks. If the dollar strengthens aga...
by nedsaid
Sat Aug 02, 2014 6:14 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12285

Re: Dave Ramsey still defending 12% and still angry at "nerd

I listened about 2/3 of the way through. I agree with Dave that the human element is important and the key is to get people to invest. This goes along with my point that I make over and over that behavior is the most important element of investment success. Though I am not a quant and though I have ...
by nedsaid
Sat Aug 02, 2014 6:00 pm
 
Forum: Investing - Theory, News & General
Topic: Dave Ramsey still defending 12% and still angry at "nerds"
Replies: 194
Views: 22327

Re: International investing. A good call by our mentor.

I have to disagree with JoMoney on his point that International investing increases the very risks the investor is trying to diversify away from. This is making the assumption that our relative stability and safe haven status in the world will continue. Probably so but no guarantees. I diversify Int...
by nedsaid
Sat Aug 02, 2014 5:29 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12285

Re: Need Perspective and Advise

You have a great portfolio, you don't need a financial advisor. Keep doing what you are doing and you will be just fine.
by nedsaid
Sat Aug 02, 2014 5:20 pm
 
Forum: Investing - Help with Personal Investments
Topic: Need Perspective and Advise
Replies: 21
Views: 1807

Re: Dividend Strategy Ain't For Everyone

I have posted before about a friend and his wife who has a 100% stock portfolio and he has invested this way for many years. He has used a value and dividend strategy and it has worked well enough for him. The dividends off the portfolio plus whatever Social Security they will get will be enough to ...
by nedsaid
Sat Aug 02, 2014 5:17 pm
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10504

Re: International investing. A good call by our mentor.

Bobcat2 in another thread raised a great point about International investing, that is currency risk. Whatever amount you have invested in International Stocks and Bonds is the degree to which you are exposed to currency risk, that is unless the fund purchases currency hedges. His point was how much ...
by nedsaid
Sat Aug 02, 2014 5:06 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12285

Re: Dividend Strategy Ain't For Everyone

I don't think you are missing anything. If you can max your 401k's and ROTH IRA's every year (which I have never come close to doing), you will be fine. There are a lot of threads on this, many of them started by Larry Swedroe. Pretty much what he says is that higher dividend stocks have done a bit ...
by nedsaid
Sat Aug 02, 2014 10:00 am
 
Forum: Investing - Theory, News & General
Topic: Dividend Strategy Ain't For Everyone
Replies: 149
Views: 10504

Re: MOM faltering? [Momentum]

There is nothing wrong with disagreeing with an article or pointing things out that the original poster didn't think about. But there is an art to disagreeing with somebody while respecting the other person. It is the easiest thing in the world to be dismissive about what somebody else has to say. I...
by nedsaid
Wed Jul 30, 2014 9:17 pm
 
Forum: Investing - Theory, News & General
Topic: MOM faltering? [Momentum]
Replies: 94
Views: 6127

Re: global diversification works in long term

I have believed in global diversification for years. I don't believe that the US will be the next Japan but we should not as US investors completely discount that possibility. Diversification all over the world has worked for me. I am a believer.
by nedsaid
Wed Jul 30, 2014 9:09 am
 
Forum: Investing - Theory, News & General
Topic: global diversification works in long term
Replies: 21
Views: 1912

Re: Was ready to pull plug on Janus..until

There are a couple of problems with comparing active funds with index funds. I own active funds, mostly in a fund company that I have invested in for 30 years. At my workplace savings plan, I own mostly index funds but use active funds for asset classes where an index isn't available. Here are the p...
by nedsaid
Wed Jul 30, 2014 9:03 am
 
Forum: Investing - Help with Personal Investments
Topic: Was ready to pull plug on Janus..until
Replies: 66
Views: 4013
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