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Re: HAPPY BIRTHDAY, VANGUARD

I don't understand what this means: These enhancements to our first S&P 500 index fund were not designed to provide higher risk-adjusted returns. That, to me, would be a fool’s errand. Rather, they were designed as targeted index portfolios to meet the legitimate needs of long-term investors. C...
by pascalwager
Sat Sep 27, 2014 1:52 am
 
Forum: Investing - Theory, News & General
Topic: HAPPY [40th] BIRTHDAY, VANGUARD
Replies: 16
Views: 1491

Re: Fama: Active Management a Bad Bet

As for his own portfolio, Fama said he primarily owns equity index funds and some Treasury Inflation Protected Securities (TIPS), adding that he has no interest in real estate or bonds. "I'm a tenured professor," he said. "The university issued me a bond." So Fama considers his ...
by pascalwager
Fri Sep 19, 2014 3:23 pm
 
Forum: Investing - Theory, News & General
Topic: Fama: Active Management a Bad Bet
Replies: 3
Views: 646

Re: What's in your tax advantage accounts?

VG IRA: TSM and TISM
VG ROTH: TSM
Transamerica VA: DFA equity funds
by pascalwager
Fri Sep 19, 2014 2:34 pm
 
Forum: Investing - Theory, News & General
Topic: What's in your tax advantage accounts?
Replies: 54
Views: 3930

Re: How to become a millionaire retiree -- then and now

In 1965 starting salary for a BSEE was $7,000 and $10,000 for an MSEE.
by pascalwager
Mon Sep 01, 2014 2:26 am
 
Forum: Investing - Theory, News & General
Topic: How to become a millionaire retiree -- then and now
Replies: 67
Views: 9949

Re: Why invest in bonds?

Keep two years emergency funds (checking, 0.95% savings, CDs). Then you can isolate your survival fears and retirement investment efforts and can consider going with 100% stocks. When you reach age 70, you can then consider gradually adding bonds.
by pascalwager
Sun Aug 31, 2014 4:55 pm
 
Forum: Investing - Theory, News & General
Topic: Why invest in bonds?
Replies: 103
Views: 6315

Re: High net worth in CA - what % of bonds in munis?

In his new book, Bill Bernstein recommends 1/3 each muni's, CDs, and Treasuries for a taxable portfolio FI.
by pascalwager
Sat Aug 30, 2014 12:06 am
 
Forum: Investing - Theory, News & General
Topic: High net worth in CA - what % of bonds in munis?
Replies: 21
Views: 1501

Re: International allocation

My advisor (1995) first advocated 50/50 and I've stayed the course. Also, it's the long term US/int'l average. I've considered lowering int'l but any other ratio seems strange now after all these years.
by pascalwager
Sun Aug 24, 2014 3:12 pm
 
Forum: Investing - Theory, News & General
Topic: International allocation
Replies: 81
Views: 4920

Re: William Bernstein quoted in a WSJ article today

Bill seems to have changed his mind on the Vg PM & M fund. Now he seems to consider it a viable inflation-hedge investment, even with the added non-PM commodities.
by pascalwager
Mon Aug 18, 2014 8:39 pm
 
Forum: Investing - Theory, News & General
Topic: William Bernstein quoted in a WSJ article today
Replies: 3
Views: 1573

Re: Treasuries vs CDs/Cash

Bill Bernstein advises a ST Treasuries (~2.5 years maturity) AA to use for stock purchases after a stock market decline. Short term for less inflation risk. Most investors seem to want to get returns from their bonds and use longer maturities. Bill disagrees with that approach. He also advises a ~2....
by pascalwager
Tue Aug 12, 2014 9:16 pm
 
Forum: Investing - Help with Personal Investments
Topic: Treasuries vs CDs/Cash
Replies: 13
Views: 1830

Re: Going 60+% international? (US resident)

Larry Swedroe recommends no more than 50% int'l due to higher transaction costs.
by pascalwager
Fri Aug 08, 2014 11:53 pm
 
Forum: Investing - Theory, News & General
Topic: Going 60+% international? (US resident)
Replies: 83
Views: 6033

Re: Should this person buy bonds??

I believe Charles Ellis would say: if you don't need them, don't buy them.
by pascalwager
Fri Aug 08, 2014 3:47 pm
 
Forum: Investing - Theory, News & General
Topic: Should this person buy bonds??
Replies: 16
Views: 1133

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

The puzzling part to me has always been this recognition that none of us can predict the future or know which asset class will out perform. In addition, many Bogleheads refer to simplicity. Would a 50% US and 50% International equity allocation not be the simple and "Boglehead" way? I wou...
by pascalwager
Thu Aug 07, 2014 8:50 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12566

Re: Current Relevance of Short Term Bonds - Bill Bernstein Q

Even a 7 year CD has low duration risk if you can break it for a small fee. You need to watch out for changes your CD's terms though and be ready to break the CD if your bank makes unfavorable changes regarding withdrawals. I just opened a few 5-year Roth IRA CD's with Synchrony Bank. A safe altern...
by pascalwager
Wed Aug 06, 2014 7:49 pm
 
Forum: Investing - Theory, News & General
Topic: Current Relevance of Short Term Bonds - Bill Bernstein Q
Replies: 11
Views: 1226

Re: Current Relevance of Short Term Bonds - Bill Bernstein Q

A safe alternative that would satisfy Dr. BIll's criteria would have been investing in 7-year Penfed CDs starting in 2007. It would have brought a 6.25% compounded yield from 2007-20014, and it could have been reinvested in January for another 7 years at 3%. No clothespin needed (except at tax time...
by pascalwager
Wed Aug 06, 2014 4:09 pm
 
Forum: Investing - Theory, News & General
Topic: Current Relevance of Short Term Bonds - Bill Bernstein Q
Replies: 11
Views: 1226

Re: Why should a portfolio get safer as one ages?

I personally like Charles Ellis' idea to stay 100% stocks until age 70, then gradually add bonds if you think you need them . My plan is to buy a $10k I-Bond each year. At age 72, I'm on course with two I-Bonds. Some investors include I-Bonds as a cash asset, but Larry Swedroe groups them with TIPS ...
by pascalwager
Tue Aug 05, 2014 8:14 pm
 
Forum: Investing - Theory, News & General
Topic: Why should a portfolio get safer as one ages?
Replies: 30
Views: 2869

Re: Short term vs Intermediate term bond funds

I like risk-free fixed income and have rarely used intermediate term bonds. I get plenty of risk from stocks. When rates were higher I used DFA ultra-short bond funds (one-year and two-year). Now I only use savings accounts, CDs, and I-Bonds. When it comes to bonds, I'm really not a Boglehead.
by pascalwager
Tue Aug 05, 2014 2:57 pm
 
Forum: Investing - Theory, News & General
Topic: Short term vs Intermediate term bond funds
Replies: 27
Views: 2597

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

In a global economy, it may not be possible to invest patriotically. At the very least, you would need to use a Patriot Index Fund, and you would need to read the prospectus very carefully.
by pascalwager
Mon Aug 04, 2014 6:50 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12566

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

I think you might want to read his books. That would be a good start. Agreed. I have read The Little Book of Common Sense Investing and Common Sense on Mutual Funds . I have read (and seen) a few speeches and interviews, articles and many, many quotes provided in articles and thread discussions. It...
by pascalwager
Mon Aug 04, 2014 3:31 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12566

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

I'm in Sweden and looking at Morningstar I see that Global index funds here has a bit lower P/E (around 17) than our US index funds and local index funds. Is this an argument for holding a global market weight portfolio? No, but these global funds may have a lot of int'l based on the lower P/E. Int...
by pascalwager
Mon Aug 04, 2014 3:24 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12566

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

I'm in Sweden and looking at Morningstar I see that Global index funds here has a bit lower P/E (around 17) than our US index funds and local index funds. Is this an argument for holding a global market weight portfolio? No, but these global funds may have a lot of int'l based on the lower P/E. Int...
by pascalwager
Sun Aug 03, 2014 5:59 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12566

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

I'm in Sweden and looking at Morningstar I see that Global index funds here has a bit lower P/E (around 17) than our US index funds and local index funds. Is this an argument for holding a global market weight portfolio? No, but these global funds may have a lot of int'l based on the lower P/E. Int...
by pascalwager
Sat Aug 02, 2014 7:55 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12566

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

Thanks Taylor,

I've got the 10th edition of Mr. Bogle's book and will re-read that chapter.
by pascalwager
Fri Aug 01, 2014 11:34 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12566

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

Also, I guess it depends on what one considers "recent". I have not been investing long at all, so I don't know how folks invested in the 1990's or whenever. But, I wonder how much international was included back then? Did that 2004 - 2011 ish time frame have anything to do with the love ...
by pascalwager
Fri Aug 01, 2014 7:22 pm
 
Forum: Investing - Theory, News & General
Topic: International investing. A good call by our mentor.
Replies: 145
Views: 12566

Re: global diversification works in long term

What tends to worry me these days about international equities -- especially in Japan and Europe -- is that their demographics are horrible. The U. S. has the "echo-boom" generation that will be very productive and numerous, and so we should see some continued wealth creation in the U. S....
by pascalwager
Wed Jul 30, 2014 5:02 pm
 
Forum: Investing - Theory, News & General
Topic: global diversification works in long term
Replies: 21
Views: 1949

Re: The emerging market portion of Total International Stock

The EM portion of TISM varies because it's the actual int'l market percentage for EM. By including EM in TISM, the volatility of EM is masked and the investor is less likely to make changes compared with holding EM separately. As I recall, Merriman used to recommend 50:50 domestic:foreign; so 10% EM...
by pascalwager
Wed Jul 30, 2014 3:39 am
 
Forum: Investing - Theory, News & General
Topic: The emerging market portion of Total International Stock
Replies: 5
Views: 1201

Re: Should retirement investors own small/value stocks at al

larryswedroe wrote:fwiw retirees are the very people who should tilt AND lower beta exposure to cut tail risk when it matters most in withdrawal stage
larry


Yes, if you're a retiree with a large FI AA, then why not add more FI and go all the way to the LP?
by pascalwager
Tue Jul 29, 2014 3:57 pm
 
Forum: Investing - Theory, News & General
Topic: Should retirement investors own small/value stocks at all?
Replies: 36
Views: 2995

Re: Should retirement investors own small/value stocks at al

This is from Fama, Cochrane, and Norstad: The average investor works and usually should use total market. If an investor works for a large growth company, then should consider holding SV stocks. A retiree is not average by definition (not part of the work force) and would not be increasing an existi...
by pascalwager
Tue Jul 29, 2014 3:52 pm
 
Forum: Investing - Theory, News & General
Topic: Should retirement investors own small/value stocks at all?
Replies: 36
Views: 2995

Re: Best way to reach initial allocation in a bull market?

by mhalley » Fri Jul 25, 2014 6:31 am The standard boglehead answer is that if you have a desired aa, then go ahead and jump in and buy your mutual funds/etfs. Certainly I can understand how if you have been sitting out this latest run, jumping in right now could be pretty scary. If it were me, I w...
by pascalwager
Tue Jul 29, 2014 3:13 am
 
Forum: Investing - Theory, News & General
Topic: Best way to reach initial allocation in a bull market?
Replies: 28
Views: 2650

Re: Best way to reach initial allocation in a bull market?

by mhalley » Fri Jul 25, 2014 6:31 am The standard boglehead answer is that if you have a desired aa, then go ahead and jump in and buy your mutual funds/etfs. Certainly I can understand how if you have been sitting out this latest run, jumping in right now could be pretty scary. If it were me, I w...
by pascalwager
Mon Jul 28, 2014 4:21 pm
 
Forum: Investing - Theory, News & General
Topic: Best way to reach initial allocation in a bull market?
Replies: 28
Views: 2650

Re: POLL: Do you own corporate bonds?

I have only I-Bonds and CDs for FI, so I voted "no bonds".
by pascalwager
Sat Jul 26, 2014 2:49 am
 
Forum: Investing - Theory, News & General
Topic: POLL: Do you own corporate bonds?
Replies: 35
Views: 2197

Re: DFA funds with one-time fee?

I started two DFA accounts in 1995 and separated from the advisor in 2011. One account is taxable. I cannot rebalance within this account because I'm not allowed to buy more DFA shares (except for reinvested dividends and capital gains). I also have a DFA VA. I can do transfers within this account f...
by pascalwager
Sat Jul 26, 2014 1:22 am
 
Forum: Investing - Theory, News & General
Topic: DFA funds with one-time fee?
Replies: 8
Views: 982

Re: Bonds beat stocks over the last 15 years

. Vanguard total stock market (VTSMX) = 5.25% Vanguard total bond market (VBMFX) = 5.37% Man I'm glad I didn't do a lump sum of all of my money in 1999. I did a large lump sum into two accounts in 1995, but at least no large market fund--all tilted. Value of one account now is 3.4 x cost basis.
by pascalwager
Thu Jul 24, 2014 6:59 pm
 
Forum: Investing - Theory, News & General
Topic: Bonds beat stocks over the last 15 years
Replies: 93
Views: 8265

Re: Variable Annuity funding BY Cd's good or bad?

Are you sure about the ST Treasury Fund? It's not currently one of the VG VA portfolios and wasn't a few years ago either when I was investigating a VA transfer. VA's are not considered efficient compared to a taxable account unless you hold for at least 45 years, or use a tax-inefficient fund such ...
by pascalwager
Thu Jul 24, 2014 4:20 pm
 
Forum: Investing - Theory, News & General
Topic: Variable Annuity funding BY Cd's good or bad?
Replies: 6
Views: 347

Re: (TIPS) Treasury Inflation Protected Securities

Rick Ferri (author, advisor) recommends TIPs at 20% of fixed income.
by pascalwager
Mon Jul 21, 2014 2:10 am
 
Forum: Investing - Help with Personal Investments
Topic: (TIPS) Treasury Inflation Protected Securities
Replies: 3
Views: 996

Re: Poll: Has your AA changed in the last 18 months

I sold some IT bond funds last year, at a loss, and bought TSM. I discovered that I can't accept IT bond fund losses because of the assumed prolonged restoration period, but more easily accept stock losses. Also, I moved my large bank savings from a 0.1% account to an internet bank savings and CD la...
by pascalwager
Sun Jul 20, 2014 4:58 pm
 
Forum: Investing - Theory, News & General
Topic: Poll: Has your AA changed in the last 18 months
Replies: 58
Views: 3772

Re: Do any bogleheads hold the "Larry Portfolio?"

Larry, what does your (70%) bond portfolio look like? In your books you advise using short-term bonds for high bond allocations.
by pascalwager
Fri Jul 18, 2014 8:07 pm
 
Forum: Investing - Theory, News & General
Topic: Do any bogleheads hold the "Larry Portfolio?"
Replies: 18
Views: 2613

Re: [Poll] % of 3 funds in your financial asset portfolio?

I have 0% TBM, so I assume that means that I have 0% three-fund, despite the fact that TSM and TISM are about 40% of my stocks.
by pascalwager
Fri Jul 18, 2014 5:52 pm
 
Forum: Investing - Theory, News & General
Topic: [Poll] % of 3 funds in your financial asset portfolio?
Replies: 31
Views: 1759

Re: recent brokered CD fluctuation

What do you mean by "up 4.65%"? Also, for comparison, according to Samuel Lee (M*), the duration of a current 5-year CD is at most, 1.7 years, by his calculations. So, do you actually know the duration of your 10-year CD?
by pascalwager
Fri Jul 18, 2014 2:17 am
 
Forum: Investing - Theory, News & General
Topic: recent brokered CD fluctuation
Replies: 13
Views: 931

Re: Total Bond Yield vs. 5 year CD Interest Rates

...Bill Bernstein, in his new book, refers to these people #CD high-rate seekers# as "clever and aggressive". So far, I've only used a Synchrony 3-year CD ladder to improve the return on my cash... I don't quite understand. Let me speak directly to the my point of complexity. a) For how m...
by pascalwager
Fri Jul 18, 2014 1:06 am
 
Forum: Investing - Theory, News & General
Topic: Total Bond Yield vs. 5 year CD Interest Rates
Replies: 16
Views: 2386

Re: Total Bond Yield vs. 5 year CD Interest Rates

Now, the reality check. What ARE CD rates today, just a quick peek. Let's say Ally. 5 years, 1.6%. What's the SEC rate for Total Bond? 1.99%. What has the the total return been for Total Bond, 1-3-5-10, not saying anything about the future, just how has it fared recently? 4.15%, 3.49%, 4.63%, 4.80%...
by pascalwager
Thu Jul 17, 2014 7:07 pm
 
Forum: Investing - Theory, News & General
Topic: Total Bond Yield vs. 5 year CD Interest Rates
Replies: 16
Views: 2386

Re: Total Bond Yield vs. 5 year CD Interest Rates

Now, the reality check. What ARE CD rates today, just a quick peek. Let's say Ally. 5 years, 1.6%. What's the SEC rate for Total Bond? 1.99%. What has the the total return been for Total Bond, 1-3-5-10, not saying anything about the future, just how has it faired recently? 4.15%, 3.49%, 4.63%, 4.80...
by pascalwager
Thu Jul 17, 2014 4:16 pm
 
Forum: Investing - Theory, News & General
Topic: Total Bond Yield vs. 5 year CD Interest Rates
Replies: 16
Views: 2386

Re: But why not 100% stock index fund?

The 100% stock portfolio was recently legitimized by John Bogle in an interview, especially in light of expected low bond returns. But the investor needs to have the necessary "grit" to make it work. Considering my thoughts/actions in 2000 and 2008, I gave myself an 89% grit rating, and th...
by pascalwager
Wed Jul 16, 2014 10:56 pm
 
Forum: Investing - Theory, News & General
Topic: But why not 100% stock index fund?
Replies: 76
Views: 7492

Re: POLL: Do you have a dedicated REIT allocation?

I would only add them as an inflation hedge (as per Bernstein, Swensen), but not at current high prices. So I remain TSM-TISM.
by pascalwager
Wed Jul 16, 2014 3:51 pm
 
Forum: Investing - Theory, News & General
Topic: POLL: Do you have a dedicated REIT allocation?
Replies: 123
Views: 7622

Re: But why not 100% stock index fund?

In a recent interview, John Bogle legitimizes the 100% stock portfolio, especially in an era of low bond returns.
by pascalwager
Wed Jul 16, 2014 11:18 am
 
Forum: Investing - Theory, News & General
Topic: But why not 100% stock index fund?
Replies: 76
Views: 7492

Re: Article: Conversation with John Bogle - Part II

He now considers an all-stock portfolio a legitimate option, especially for someone impatient with current low bond yields. He also considers owning ST, IT, or/and LT (corporate) bond funds equally valid depending on one's risk/return preference. His own preference for IT bond funds is a behavioral ...
by pascalwager
Wed Jul 16, 2014 10:42 am
 
Forum: Investing - Theory, News & General
Topic: Article: Conversation with John Bogle - Part II
Replies: 11
Views: 1508

Re: In a crash, will you re-balance to maintain your target

In all of the previous crashes I was set up for scheduled quarterly rebalancing, so no problem. But now, as a retiree, I'm all self-managed, and don't really have any bonds to reallocate into stocks anyway. I do have a lot of cash and "cash", but I probably would not deplete it to buy stoc...
by pascalwager
Tue Jul 15, 2014 12:08 am
 
Forum: Investing - Theory, News & General
Topic: In a crash, will you re-balance to maintain your target AA?
Replies: 64
Views: 4274

Re: Cash allocation in a portfolio

I answered, but I strongly doubt the responses capture what you are after. The prose asks how much cash people keep on hand for the purpose of buying equities during downturns. . But the poll option just asks what % of the portfolio is held in cash. I have no doubt that a sizable fraction of Bogleh...
by pascalwager
Mon Jul 14, 2014 3:12 pm
 
Forum: Investing - Theory, News & General
Topic: Cash allocation in a portfolio
Replies: 42
Views: 3841

Re: Cash allocation in a portfolio

I answered 0%. But I don't sell bonds re-balance. If I have to re-balance, I'll use new contribution. But even in 2008-9 crash, I used the same ratio for contribution. My initial fund started with a fixed 80/20 ratio and my contribution also has 80/20 ratio. Now the portfolio weights are close to 9...
by pascalwager
Mon Jul 14, 2014 3:00 pm
 
Forum: Investing - Theory, News & General
Topic: Cash allocation in a portfolio
Replies: 42
Views: 3841

Re: Cash allocation in a portfolio

I have a category which I think of as stability assets : checking, savings, CDs, I-bonds, IT Treasuries. I keep this as 20% of portfolio along with 80% stock funds. I use the Treasuries to complete the 20% AA and bring the overall duration up from zero and closer to 2.5 years. If I should happen to ...
by pascalwager
Mon Jul 14, 2014 7:18 am
 
Forum: Investing - Theory, News & General
Topic: Cash allocation in a portfolio
Replies: 42
Views: 3841

Re: Keep investing simple--consolidate.

I resolved my own quandary by investing both ways (slice-and-dice and total market) and I keep two completely separate dfa portfolios: currently 60% DFA and 40% VG Total Market (TSM and TISM). The DFA portion is larger because I initially lump-summed into it a long time ago. Pascal: Consider consol...
by pascalwager
Fri Jul 11, 2014 5:59 pm
 
Forum: Investing - Theory, News & General
Topic: One Total Stock Market Index Fund or 3-4 Sub-Funds?
Replies: 19
Views: 3629
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