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by pascalwager
Sat May 23, 2015 3:49 pm
Forum: Investing - Theory, News & General
Topic: Simple (ex: DFA core) Vs Complex (S&D multiple segments)
Replies: 10
Views: 724

Re: Simple (ex: DFA core) Vs Complex (S&D multiple segments)

I have two self-managed (no advisor) DFA multi-factor accounts (nine equity funds), but I find the DFA core approach very appealing. The core funds may be the DFA response to the Vanguard total market funds and their wonderful simplicity. The DFA growth funds allow a growth tilt for an investor who ...
by pascalwager
Sat May 23, 2015 3:19 pm
Forum: Investing - Theory, News & General
Topic: Why not overweight international?
Replies: 37
Views: 3110

Re: Why not overweight international?

I use 50% int'l as that's the long-term global average and I don't want to overweight (>50% int'l) due to higher int'l fund management transaction costs. Int'l currency fluctuations (and so-called "currency risk") do not influence my int'l AA percentage as I'm a long-term investor and the ...
by pascalwager
Thu May 21, 2015 11:07 am
Forum: Investing - Theory, News & General
Topic: How accurate is Vanguard's 'Portfolio Watch'
Replies: 12
Views: 1635

Re: How accurate is Vanguard's 'Portfolio Watch'

Portfolio Watch is quite useful for checking my portfolio total amount and percentages of US stocks, int'l stocks, bonds, and cash. But there are two defects: -If you have int'l funds without a ticker (e.g., variable annuity), the edit function doesn't include style or size. -Once you set up an acc...
by pascalwager
Thu May 21, 2015 1:59 am
Forum: Investing - Theory, News & General
Topic: Optimal Asset Allocation across Investment Horizons?
Replies: 14
Views: 1359

Re: Optimal Asset Allocation across Investment Horizons?

For inflation protection, I like an equity-heavy portfolio, value-tilted and country diverse, but with annual I Bond purchases and maybe some TIPS. This is basically the DFA portfolio set up for me by an advisor 20 years ago and it's still growing in retirement. Bill Bernstein discusses this kind of...
by pascalwager
Mon May 18, 2015 3:18 am
Forum: Investing - Theory, News & General
Topic: AQR's Cliff Asness: Guest appearance on WealthTrack
Replies: 36
Views: 2759

Re: AQR's Cliff Asness: Guest appearance on WealthTrack

Asness seemed to be saying that 40% bonds was too little to provide diversification and would only provide dilution.
by pascalwager
Sat May 16, 2015 3:08 pm
Forum: Investing - Theory, News & General
Topic: How accurate is Vanguard's 'Portfolio Watch'
Replies: 12
Views: 1635

Re: How accurate is Vanguard's 'Portfolio Watch'

Portfolio Watch is quite useful for checking my portfolio total amount and percentages of US stocks, int'l stocks, bonds, and cash. But there are two defects: -If you have int'l funds without a ticker (e.g., variable annuity), the edit function doesn't include style or size. -Once you set up an acco...
by pascalwager
Fri May 15, 2015 10:41 pm
Forum: Investing - Theory, News & General
Topic: Is monthly rebalancing too frequent?
Replies: 38
Views: 2821

Re: Is monthly rebalancing too frequent?

Bill Bernstein recommends rebalancing every few years. That's what I do, mainly just trying to keep US:int'l at 50:50.
by pascalwager
Wed May 13, 2015 1:27 am
Forum: Investing - Help with Personal Investments
Topic: Total World Stock Index
Replies: 44
Views: 3738

Re: Total World Stock Index

The Vanguard TSM and TISM funds include thousands of companies that are not included in TWS. That's one reason why I don't use the single fund.
by pascalwager
Tue May 12, 2015 12:35 pm
Forum: Investing - Theory, News & General
Topic: Bonds: All Treasuries or Mixture?
Replies: 17
Views: 1905

Re: Bonds: All Treasuries or Mixture?

I like Larry Swedroe's compromise between inflation risk and reinvestment risk : about four years duration. I use 1/2 each Vanguard ST and IT Treasury Funds (Larry recommends a bond ladder.) I avoid credit risk as per Larry and David Swensen (and prefer stocks as per Charles Ellis). I had a DFA ST c...
by pascalwager
Mon May 11, 2015 6:08 pm
Forum: Investing - Theory, News & General
Topic: International - Who really is at 40%
Replies: 93
Views: 6642

Re: International - Who really is at 40%

I'm currently at 48% int'l, but may rebalance back to 50% in the near future. I started out in 1995 with three accounts: 53% int'l, 49% int'l, and 30% int'l. As the third account (deferred comp) grew over the years, the overall int'l AA was reduced from about 52% down to about 44%. Then, a few years...
by pascalwager
Fri May 08, 2015 2:06 pm
Forum: Investing - Theory, News & General
Topic: Round Numbers in Portfolio Allocations
Replies: 49
Views: 2896

Re: Round Numbers in Portfolio Allocations

Bill Bernstein has referred to AAs of less than 5% in the past: precious metals 3% max, HY bonds 2% max. More generally, most of his factor-tilted high bond % portfolios include one or more funds of less than 5%. For example, Sheltered Sam's AA in Investor's Manifesto has seven (7) funds of less tha...
by pascalwager
Fri May 08, 2015 1:32 pm
Forum: Investing - Theory, News & General
Topic: Meeting to improve 403b with our plan administrator
Replies: 13
Views: 920

Re: Meeting to improve 403b with our plan administrator

We had three plans to choose from--two were run by banks. One of the bank plans did have VG 500, DFA Microcap, and a Barclays Aggregate bond fund with very low ERs, but also had an overall fee. I used the plan run by a large pension organization, which managed it's own index funds: S&P 500 (35 b...
by pascalwager
Thu May 07, 2015 2:47 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Ultra-Short-Term Bond Fund now available
Replies: 49
Views: 7266

Re: Vanguard Ultra-Short-Term Bond Fund now available

lack_ey wrote:What's the other 65% of the allocation? If most or all of that is stocks, I don't think you want the 35% to be pretty much all corporate issues.


Agreed. Maybe start over with a ST and IT Treasury Funds split for a duration of about 4 years.
by pascalwager
Thu May 07, 2015 2:39 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Ultra-Short-Term Bond Fund now available
Replies: 49
Views: 7266

Re: Vanguard Ultra-Short-Term Bond Fund now available

Also, at Synchrony Bank, you can open an IRA MM account at 0.85% APY with FDIC insurance.
by pascalwager
Tue May 05, 2015 11:50 am
Forum: Investing - Theory, News & General
Topic: Who's Buying I Bonds Now?
Replies: 39
Views: 2870

Re: Who's Buying I Bonds Now?

I buy the max every January 1 for some small protection in the event of unexpected inflation.
by pascalwager
Fri Apr 24, 2015 12:55 am
Forum: Investing - Theory, News & General
Topic: Short or Intermediate Bond Funds?
Replies: 2
Views: 462

Re: Short or Intermediate Bond Funds?

You can combine two bond funds to get a duration of about four years. Some consider that to be a good balance between inflation risk and reinvestment risk.
by pascalwager
Thu Apr 23, 2015 11:46 am
Forum: Investing - Theory, News & General
Topic: Age in Bonds Poll
Replies: 72
Views: 3931

Re: Age in Bonds Poll

At age 72 I'm still somewhat in the accumulation stage, but mainly adding to HY savings. My stocks are at about 84% of portfolio.
by pascalwager
Thu Apr 23, 2015 2:02 am
Forum: Investing - Theory, News & General
Topic: "How much of your portfolio is in index funds, and why?"
Replies: 91
Views: 8523

Re: "How much of your portfolio is in index funds, and why?"

My index funds (VG TSM and TISM) comprise 34% of my portfolio. The rest is DFA stock funds, I-Bonds, bond funds, CDs, and cash.
by pascalwager
Wed Apr 22, 2015 12:53 pm
Forum: Investing - Theory, News & General
Topic: David Booth interviews Eugene Fama
Replies: 11
Views: 1893

Re: David Booth interviews Eugene Fama

After re-listening a few times, Fama referred specifically to small company funds as being a problem (time mark 46:11). I liked his comments about paper writing: keep it as simple as possible. Put all of the simple stuff in the beginning and the technical at the end to hold the reader's attention as...
by pascalwager
Mon Apr 20, 2015 9:13 pm
Forum: Investing - Theory, News & General
Topic: David Booth interviews Eugene Fama
Replies: 11
Views: 1893

Re: David Booth interviews Eugene Fama

by robert88 » Mon Apr 20, 2015 6:32 pm pascalwager wrote: Here, Fama says that indexing is stupid. But previously, he has said that the average investor should invest in the total market. The DFA website refers to their Fama-influenced core funds as total market funds, holding all of the companies ...
by pascalwager
Mon Apr 20, 2015 3:01 pm
Forum: Investing - Theory, News & General
Topic: David Booth interviews Eugene Fama
Replies: 11
Views: 1893

Re: David Booth interviews Eugene Fama

Here, Fama says that indexing is stupid. But previously, he has said that the average investor should invest in the total market. The DFA website refers to their Fama-influenced core funds as total market funds, holding all of the companies in the market but not by capitalization, and internally til...
by pascalwager
Thu Apr 16, 2015 4:53 pm
Forum: Investing - Theory, News & General
Topic: I and EE Bonds - What will the new rate be?
Replies: 18
Views: 2257

Re: I and EE Bonds - What will the new rate be?

The current variable rate is 1.48% for I-Bonds. Why would a 0.00% new variable rate be expected?
by pascalwager
Thu Apr 16, 2015 1:56 am
Forum: Investing - Theory, News & General
Topic: How much riskier are munis than treasuries?
Replies: 32
Views: 3943

Re: How much riskier are munis than treasuries?

Compared to Treasuries, munis reduce the diversification power of fixed income because of credit and call risk. I don't use munis (or corporates). I take my risks in equities, not fixed income.
by pascalwager
Sat Apr 11, 2015 12:50 pm
Forum: Investing - Theory, News & General
Topic: Inflation Protection [(Morningstar article)]
Replies: 7
Views: 1216

Re: Inflation Protection [(Morningstar article)]

In my area some public employees with collective bargaining have COLA, but with a cap of 2 to 3%, typically.
by pascalwager
Fri Apr 10, 2015 12:07 pm
Forum: Investing - Theory, News & General
Topic: Warren Buffett Financial Advisor
Replies: 26
Views: 4410

Re: Warren Buffett Financial Advisor

Simply, it's a recommendation by Buffett to invest primarily in the indexed American stock market provided you have a long time horizon (20 to 30 years) and purchase shares over an extended period.
by pascalwager
Wed Apr 08, 2015 7:59 pm
Forum: Investing - Theory, News & General
Topic: Withdrawing from balanced funds when stocks are down
Replies: 30
Views: 1780

Re: Withdrawing from balanced funds when stocks are down

dbr wrote:
No less a luminary than Larry Swedroe has supposedly stated that he would follow a strategy of rebalancing out of stocks when they are up but not into stocks when they are down.

I recall Bill Bernstein saying the same thing--for retirees.
by pascalwager
Wed Apr 08, 2015 4:37 pm
Forum: Investing - Theory, News & General
Topic: Warren Buffett Financial Advisor
Replies: 26
Views: 4410

Re: Warren Buffett Financial Advisor

After rereading a few times, Buffett is mainly saying that putting your money in a bank account is far riskier than putting it in an index fund. I notice that 25% of Berkshire Hathaway capital structure is corporate bonds issued by the company. If Buffett is against owning bonds, who does he think s...
by pascalwager
Tue Apr 07, 2015 1:01 pm
Forum: Investing - Theory, News & General
Topic: Why bonds?
Replies: 13
Views: 1552

Re: Why bonds?

Postby z3r0c00l » Tue Apr 07, 2015 6:13 am pascalwager wrote: Warren Buffett considers bonds to be far riskier than stocks. With that in mind, I prefer to own only stock funds, I-Bonds, and bank savings/CDs. So two kinds of bonds and stocks? No. In general, bonds are not even part of my eligible un...
by pascalwager
Tue Apr 07, 2015 2:16 am
Forum: Investing - Theory, News & General
Topic: Why bonds?
Replies: 13
Views: 1552

Re: Why bonds?

Warren Buffett considers bonds to be far riskier than stocks. With that in mind, I prefer to own only stock funds, I-Bonds, and bank savings/CDs.
by pascalwager
Tue Apr 07, 2015 2:00 am
Forum: Investing - Theory, News & General
Topic: Warren Buffett Financial Advisor
Replies: 26
Views: 4410

Re: Warren Buffett Financial Advisor

I'm holding 70/30 asset allocation right now, and currently have enough in my bond fund to feel secure if things really went down. With 10 to 15 years before retirement, I'm really starting to think that I should just add to my stocks and not my bonds. Mr. Buffett would strongly disagree with your ...
by pascalwager
Mon Apr 06, 2015 9:24 pm
Forum: Investing - Theory, News & General
Topic: Switching 40% of my portfolio to bonds: just can't do it.
Replies: 52
Views: 7257

Re: Switching 40% of my portfolio to bonds: just can't do it

Even at age 72 and retired, I share your aversion to exchanging stocks for bonds. Since 1995, I've had about no more than 17% (short-term) bonds, and more recently that 17% is mostly I-Bonds and bank savings/CDs. I also remind myself that Warren Buffet considers bonds to be far riskier than stocks (...
by pascalwager
Sat Apr 04, 2015 11:40 am
Forum: Investing - Theory, News & General
Topic: The Detriments of Rebalancing
Replies: 67
Views: 5967

Re: The Detriments of Rebalancing

Postby AllYouNeedIsLove » Sat Apr 04, 2015 8:30 am To my knowledge there are many experts who believe in allowing the AA to drift with the course of the markets. I am sure there are some with this strategy specified in their IPS. I can't recall any passive-investing-type authors who recommend letti...
by pascalwager
Sat Apr 04, 2015 1:15 am
Forum: Investing - Theory, News & General
Topic: The Detriments of Rebalancing
Replies: 67
Views: 5967

Re: The Detriments of Rebalancing

If you don't rebalance, how do you maintain the asset allocation required in your Investment Policy Statement?
by pascalwager
Fri Apr 03, 2015 3:38 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Tax-Exempt Bond Index Fund vs Savings Account
Replies: 7
Views: 1839

Re: Vanguard Tax-Exempt Bond Index Fund vs Savings Account

Open a 1% APY bank (online) savings account and also keep your checking account. You can move money from savings to checking up to six times per statement period with no additional fees. Allow three days for moving money, so does require some planning. This is what I did last year, but should have d...
by pascalwager
Sat Mar 28, 2015 1:40 am
Forum: Investing - Theory, News & General
Topic: I Bonds - now or later in the year?
Replies: 44
Views: 5147

Re: I Bonds - now or later in the year?

I buy on January 1st to minimize the 5-year maturity date.
by pascalwager
Sat Mar 28, 2015 1:31 am
Forum: Investing - Theory, News & General
Topic: Vanguard's Week In Review
Replies: 19
Views: 2201

Re: Vanguard's Week In Review

by Taylor Larimore » Fri Mar 27, 2015 6:11 pm EyeDee: Vanguard's "Eye on the Economy" is one e-mail I'll not bother reading. I have learned that economic forecasts are wrong as often as right. Economic articles are mostly wasted time for me. Long ago I made a decision to simply own total ...
by pascalwager
Tue Mar 24, 2015 4:47 pm
Forum: Investing - Theory, News & General
Topic: Medium bond vs short + long bonds & rebalance
Replies: 9
Views: 1288

Re: Medium bond vs short + long bonds & rebalance

What about the Swedroe strategy of holding long term treasuries because they are more negatively correlated with equities and will provide a better ballast during market crashes? In Right Financial Plan , Larry says that short-term bonds are less correlated to equities, not long-term bonds. That's ...
by pascalwager
Fri Mar 20, 2015 1:27 pm
Forum: Investing - Theory, News & General
Topic: How do you invest your taxable account?
Replies: 69
Views: 8115

Re: How do you invest your taxable account?

by zaboomafoozarg » Fri Mar 20, 2015 4:43 am

I only buy VTSAX, VTIAX and I Bonds in my taxable accounts.


Same here, except also use HY Savings (1% APY) and CDs.
by pascalwager
Mon Mar 16, 2015 3:12 pm
Forum: Investing - Theory, News & General
Topic: Vanguard variable annuity
Replies: 7
Views: 800

Re: Vanguard variable annuity

A low-cost VA can make sense if you don't have any other tax-sheltered space for a REIT fund.

I have a large DFA VA which was recommended by my advisor 20 years ago (I was maxed out in deferred comp/ROTH), but I have long since realized that it isn't efficient.
by pascalwager
Sun Mar 08, 2015 11:25 pm
Forum: Investing - Theory, News & General
Topic: S & P 500 index fund vs S&P 500 Growth fund
Replies: 7
Views: 854

Re: S & P 500 index fund vs S&P 500 Growth fund

I went to M* and looked at each fund's holding style. VOOG has much more large growth than VOO and much less large value. I guess large growth was doing better than large value during the period you looked at, but this isn't relevant to long-term investing.
by pascalwager
Fri Mar 06, 2015 2:48 pm
Forum: Investing - Theory, News & General
Topic: Backpedaling: Rising Equity Allocation During Retirement
Replies: 38
Views: 4043

Re: Backpedaling: Rising Equity Allocation During Retiremen

Pfau writes: Do remember that ultimately, this whole discussion is about appropriate default glidepaths for those who have very little interest in investments… what should target date funds do post-retirement? Those with greater sophistication should be determining asset allocation based on their fu...
by pascalwager
Thu Mar 05, 2015 2:38 am
Forum: Investing - Theory, News & General
Topic: Tax free municipal or money market
Replies: 2
Views: 592

Re: Tax free municipal or money market

An online HY savings account (1% interest) would seem to be a better choice than a MM fund. Then the choice would be between the muni fund and the savings account.
by pascalwager
Wed Mar 04, 2015 4:46 pm
Forum: Investing - Theory, News & General
Topic: International increase in Target Retirement & LifeStrategy
Replies: 233
Views: 22742

Re: International increase in Target Retirement & LifeStrate

Postby anil686 » Wed Mar 04, 2015 3:29 pm What bothers me most about this are the following points: a) VG says costs investing internationally have come down. But this is a slight distortion - they have come down by a significant percentage but very little overall. TISM costs have gone from 0.17% t...
by pascalwager
Wed Mar 04, 2015 3:43 am
Forum: Investing - Theory, News & General
Topic: Poll: Increasing international equities
Replies: 70
Views: 5555

Re: Poll: Increasing international equities

I started out at 49/51 (US/int'l) and over the course of about 17 years gradually arrived at 56/44 three years ago when I then permanently went to 50/50.

Perhaps I'm tempted to welcome the VG move in the spirit of "misery loves company".
by pascalwager
Mon Mar 02, 2015 3:41 pm
Forum: Investing - Theory, News & General
Topic: 22 Schwab OneSource ETF used in Intelligent Portfolios
Replies: 25
Views: 3297

Re: 22 Schwab OneSource ETF used in Intelligent Portfolios

I'd prefer to have my cash in an online bank at 1% APY.
by pascalwager
Sun Mar 01, 2015 4:09 pm
Forum: Investing - Theory, News & General
Topic: International increase in Target Retirement & LifeStrategy
Replies: 233
Views: 22742

Re: International increase in Target Retirement & LifeStrate

Post by abuss368 » Fri Feb 27, 2015 12:41 am I wrote this exact post a year or two ago that 40% was right around the corner. It was obvious. No surprise here. Next is 50% US & 50% International. Good call abuss, I immediately recalled your post when I found out about the changes. Many of us rec...
by pascalwager
Sun Feb 22, 2015 1:19 am
Forum: Investing - Theory, News & General
Topic: Best Use of TIPS Fund in Retirement
Replies: 17
Views: 1755

Re: Best Use of TIPS Fund in Retirement

The problem with a TIPS fund for a retiree is liquidity risk showing up during a financial crisis. That's why Bill Bernstein recommends a TIPS ladder.
by pascalwager
Fri Feb 20, 2015 9:43 pm
Forum: Investing - Help with Personal Investments
Topic: Why don't I see more people arguing for a world portfolio?
Replies: 41
Views: 3103

Re: Why don't I see more people arguing for a world portfoli

A world portfolio weighting doesn't consider currency risk and fund management foreign trading costs. Also, ideally, the individual foreign countries should be weighted not on relative capitalization, but also consider foreign investor risks and taxation. The current world portfolio of 50/50 US/int'...
by pascalwager
Fri Feb 20, 2015 9:28 pm
Forum: Investing - Help with Personal Investments
Topic: Financial Advisor, worth it? - McAdam
Replies: 26
Views: 2257

Re: Financial Advisor, worth it? - McAdam

An advisor isn't necessary if you can read the Wiki.
by pascalwager
Fri Feb 20, 2015 9:22 pm
Forum: Investing - Theory, News & General
Topic: Beyond the Total Int'l Stock Index
Replies: 4
Views: 929

Re: Beyond the Total Int'l Stock Index

TISM is the default portfolio, but not ideal. It's main virtue is diversification. A better portfolio would weight the individual countries based on foreign investor treatment: taxation, risk of appropriation, degree of home bias, etc. Also, different portfolios for taxable and non-taxable investors...

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