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Re: Asset Allocation in taxable account

VWIGX is not an index fund--it is actively managed.
by pascalwager
Thu Apr 17, 2014 3:45 am
 
Forum: Investing - Help with Personal Investments
Topic: Asset Allocation in taxable account
Replies: 3
Views: 446

Re: what bond funds to hold(Bernstein's Sheltered Sam)

Bernstein has changed his recommendations on bond funds since the 2008 market turmoil. He doesn't recommend TIPS funds; instead buy individual TIPS. Also, he doesn't recommend credit risk (STIG) other than the minimal amount in Short-Term Bond Index Fund--or maybe TBM for younger investors. You shou...
by pascalwager
Tue Apr 15, 2014 4:59 pm
 
Forum: Investing - Help with Personal Investments
Topic: what bond funds to hold(Bernstein's Sheltered Sam)
Replies: 6
Views: 621

Re: VA Question

Thanks, I was completely off base. Some websites say LILO are taxed first and others say earnings are taxed first (my VA prospectus says earnings are taxed first). The account has quadrupled over 19 years, so it will be a long time before I begin to withdraw the non-taxable contributions.
by pascalwager
Tue Apr 15, 2014 4:47 pm
 
Forum: Investing - Help with Personal Investments
Topic: VA Question
Replies: 4
Views: 446

VA Question

Since VA's are inefficient, would it make sense to withdraw the VA non-taxable portion (contributions) and reinvest in a VG taxable account? Assume that insurance fees and fund fees add up to about 95 basis points and no withdrawal penalty.
by pascalwager
Tue Apr 15, 2014 3:35 am
 
Forum: Investing - Help with Personal Investments
Topic: VA Question
Replies: 4
Views: 446

Re: Favorite Investing Book?

All of these books become quickly dated, so my favorite is always the next one by Bernstein, Swedroe, or Ferri.
by pascalwager
Sun Apr 13, 2014 6:43 pm
 
Forum: Investing - Theory, News & General
Topic: Favorite Investing Book?
Replies: 42
Views: 3068

Re: Can I get some alpha? (DFA / Wealthfront)

Postby BigJohn » Sat Apr 12, 2014 9:39 am 2) DFA exploits unique knowledge to increase returns by tilting to small and value - Again, how is this anything like a "just get the market return" index approach? Especially now with comments on this thread that with run up in AUM they are havin...
by pascalwager
Sun Apr 13, 2014 3:55 pm
 
Forum: Investing - Theory, News & General
Topic: Can I get some alpha? (DFA / Wealthfront)
Replies: 58
Views: 2857

Re: The market portfolio vs. value tilts

That one is a real mind bender, isn't it? I don't think people like Fama and French use the word to mean anything except a portfolio with enough different individual securities in it to eliminate diversifiable risk. That is the only sense of the word that seems obviously meaningful to me. Not Frenc...
by pascalwager
Sat Apr 12, 2014 8:41 pm
 
Forum: Investing - Theory, News & General
Topic: The market portfolio vs. value tilts
Replies: 66
Views: 3033

Re: Why shouldn't i invest mostly in value funds?

I've had the same DFA portfolio since 1995: large value, small/mid value, and int'l large value (also microcap and int'l small company). It did fairly well during the "lost decade".
by pascalwager
Wed Apr 09, 2014 2:55 am
 
Forum: Investing - Theory, News & General
Topic: Why shouldn't i invest mostly in value funds?
Replies: 22
Views: 1404

Re: How has a Taleb-esque portolfio done recently?

Taleb has $30M to protect and his investments are now largely (attempted) hedges against inflation. His idea of performance is to have been 95% successful in maintaining purchasing power over the next ten or 20 years.
by pascalwager
Tue Apr 08, 2014 2:53 am
 
Forum: Investing - Theory, News & General
Topic: How has a Taleb-esque portolfio done recently?
Replies: 34
Views: 3545

Re: Bogle: Tilt To Corporates For More Yield

It's my understanding that Mr. Bogle likes the broad range of maturities in TBM and doesn't like the narrow range of maturities in ITBI. That's why he doesn't promote ITBI.
by pascalwager
Thu Apr 03, 2014 4:04 am
 
Forum: Investing - Theory, News & General
Topic: Bogle: Tilt To Corporates For More Yield
Replies: 60
Views: 5627

Re: Domestic vs. International Stock Allocation

Nisiprius wrote:

So, cap-weighting is not the automatic default starting point, and it is necessary to weigh competing factors, and different people strike the balance in different ways.


I just want to see their math because I don't know how to do this.
by pascalwager
Sat Mar 29, 2014 6:22 pm
 
Forum: Investing - Theory, News & General
Topic: Domestic vs. International Stock Allocation
Replies: 37
Views: 2926

Re: Overseas, already in VTIVX: "3 Fund Portfolio" worth try

TR2045 is basically the three-fund portfolio, although it has the int'l bond fund for a fourth fund.
by pascalwager
Fri Mar 28, 2014 2:57 am
 
Forum: Investing - Help with Personal Investments
Topic: Overseas, already in VTIVX: "3 Fund Portfolio" worth trying?
Replies: 49
Views: 3212

Re: How/do you change asset allocation with time?

I'm about 87% stock funds, 12% cash, and 1% I-bonds. I plan to keep buying an I-bond each year. I guess the stocks are my RP (risk portfolio). The cash and I-bonds are my LMP (liability matching portfolio) to supplement my pension. I don't expect bonds to become attractive in my remaining lifetime, ...
by pascalwager
Fri Mar 28, 2014 2:04 am
 
Forum: Investing - Help with Personal Investments
Topic: How/do you change asset allocation with time?
Replies: 18
Views: 1135

Re: Really confused by Bernstein

Yes, Bernstein believes that stocks and bonds are dangerous for most retirees, unless their living expenses are already covered by some combination of SS/pension/TIPS/annuities.
by pascalwager
Mon Mar 24, 2014 3:10 am
 
Forum: Investing - Theory, News & General
Topic: Really confused by Bernstein
Replies: 168
Views: 12747

Re: Charles Ellis "Letter to Grandkids"

11. Try always to see the whole picture when you make financial decisions. For example, your salary or earned income—with its predictable cash payments for your knowledge capital—will be similar to interest income from owning bonds when you lend your financial capital, or savings. What this means i...
by pascalwager
Sat Mar 22, 2014 4:42 am
 
Forum: Investing - Theory, News & General
Topic: Charles Ellis "Letter to Grandkids"
Replies: 9
Views: 2263

Re: W. Buffett - Short-Term Gov. Bonds...

For the small investor, Buffet's 10% govt bonds is either cash or T-bills for emergencies (e.g. large medical) when the stock market corrects. This AA is for a minimum 20-year time horizon.
by pascalwager
Thu Mar 13, 2014 1:28 pm
 
Forum: Investing - Help with Personal Investments
Topic: W. Buffett - Short-Term Gov. Bonds...
Replies: 15
Views: 1622

Re: Treatment of Pension in Asset Allocation

I include my pension PV in the "bonds" column (I-bonds, cash, pension PV) of my portfolio spreadsheet. This is the general recommendation of Mr. Bogle and Bill Bernstein. I just started doing this–formerly my "bonds' were about 13% of my portfolio, now about 46%. I may decide to stay ...
by pascalwager
Thu Mar 13, 2014 12:54 am
 
Forum: Investing - Help with Personal Investments
Topic: Treatment of Pension in Asset Allocation
Replies: 16
Views: 1378

Re: William Bernstein-When you've won the game, why keep pla

I've been considering Jack Bogle's recommendation to include SS and pensions in a portfolio. So I added the present value of my pension to my spreadsheet "bonds" column and went from 1% bonds (I bonds) and 13% "bonds" (I bonds and cash) to 47% "bonds" (I bonds, cash, an...
by pascalwager
Tue Mar 11, 2014 4:17 am
 
Forum: Investing - Theory, News & General
Topic: William Bernstein-When you've won the game, why keep playing
Replies: 241
Views: 24588

Re: Retired investors international allocation

Some authors advise retirees to consider reducing int'l AA because of the possibility that currency risk might appear right when they're drawing down their int'l AA.
by pascalwager
Sun Mar 09, 2014 3:47 am
 
Forum: Investing - Help with Personal Investments
Topic: Retired investors international allocation
Replies: 6
Views: 593

Re: Domestic and International Allocation of Stocks

Also, VG points out that some sectors are under-represented in a US-only portfolio; I believe heavy industry is one example.
by pascalwager
Sun Mar 09, 2014 3:36 am
 
Forum: Investing - Theory, News & General
Topic: Domestic and International Allocation of Stocks
Replies: 3
Views: 479

Re: Is Total World considered tilting?

VG makes the point that the world market is largely the summation of the individual country home biases, so maybe it's not so significant.
by pascalwager
Fri Feb 28, 2014 4:08 pm
 
Forum: Investing - Theory, News & General
Topic: Is Total World considered tilting?
Replies: 8
Views: 740

Re: Vanguard Tot Intl and Emerging Markets just got cheaper

Total World Stock Index ER dropped from 35 basis points to 30 basis points. Still three times as much as a 50/50 using TSM and TISM (9.5 basis points).
by pascalwager
Fri Feb 28, 2014 2:01 am
 
Forum: Investing - Theory, News & General
Topic: Vanguard Tot Intl and Emerging Markets just got cheaper
Replies: 49
Views: 4398

Re: Bonds - Throw it all on the table!!!

US Treasury Inflation Savings Bonds (I Bonds): Treasury Direct; 17% of FI Cash: bank savings; 83% of FI Bonds and cash: 12% of portfolio Plan to purchase $10k I Bond each year. If yields rise, might gradually transfer some equity money into my latent DFA one-year bond fund and VG short-term bond ind...
by pascalwager
Wed Jan 29, 2014 11:42 pm
 
Forum: Investing - Theory, News & General
Topic: Bonds - Throw it all on the table!!!
Replies: 84
Views: 7445

Re: Which bond fund is best?

Mr. Bogle currently recommends TBM combined with STIG for the average investor, or for more knowledgeable investors (including BHs), TBM combined with ITIG if they can except the term risk. He doesn't think the average investor understands term risk.
by pascalwager
Mon Jan 27, 2014 4:25 am
 
Forum: Investing - Theory, News & General
Topic: Which bond fund is best?
Replies: 83
Views: 3983

Re: What Bond Fund do You Invest In?

I bonds and cash (bank).
by pascalwager
Sun Jan 26, 2014 10:10 pm
 
Forum: Investing - Theory, News & General
Topic: What Bond Fund do You Invest In?
Replies: 43
Views: 2628

Re: Age in Bonds - Who Follows a Different Strategy?

I follow Charles Ellis' recommendation: No bonds until age 70. Then gradually add bonds, if you think you need them.
by pascalwager
Sun Jan 26, 2014 2:36 am
 
Forum: Investing - Theory, News & General
Topic: Age in Bonds - Who Follows a Different Strategy?
Replies: 132
Views: 6591

Re: What's Your up to the minute AA?

DFA US stocks 26%
DFA Int'l stocks 26%
VG TSM 18%
VG TISM 18%
I Bonds 2%
Cash 10%
by pascalwager
Sun Jan 26, 2014 2:18 am
 
Forum: Investing - Theory, News & General
Topic: What's Your up to the minute AA?
Replies: 83
Views: 5401

Re: A Simple Portfolio [Equity Allocation]

I started out 50/50 in 1995 and I find it hard to change now.
by pascalwager
Sat Jan 25, 2014 4:12 am
 
Forum: Investing - Theory, News & General
Topic: A Simple Portfolio [Equity Allocation]
Replies: 39
Views: 2649

Re: Indexing doesn't get you market returns

The table confuses me. I'm not learning anything. What are the groupings? Do the groupings include passive and active? In what group is VG 500 being ranked? Is large value only being ranked with large value?
by pascalwager
Sat Jan 18, 2014 1:29 am
 
Forum: Investing - Theory, News & General
Topic: Indexing doesn't get you market returns
Replies: 16
Views: 2855

Re: If Warren Buffett Just Indexed, It would consist of...?

WB would never index. He is driven to beat the market.
by pascalwager
Sat Dec 21, 2013 9:29 pm
 
Forum: Investing - Theory, News & General
Topic: If Warren Buffett Just Indexed, It would consist of...?
Replies: 25
Views: 2053

Re: Mom & Pop still not investing in equities

I was considering shifting some dividends/gains from a Schwab account into a Schwab EM ETF, but decided that I just don't have the basic knowledge required to make an informed ETF purchase (or sale). Schwab’s Guidance Place a marketable limit order to balance both execution and price. This is a lim...
by pascalwager
Tue Dec 17, 2013 1:03 am
 
Forum: Investing - Theory, News & General
Topic: Mom & Pop still not investing in equities
Replies: 15
Views: 2198

Re: Mom & Pop still not investing in equities

I was considering shifting some dividends/gains from a Schwab account into a Schwab EM ETF, but decided that I just don't have the basic knowledge required to make an informed ETF purchase (or sale). There were about five different purchase bid price options to choose from, and I felt like I was bei...
by pascalwager
Sat Dec 14, 2013 7:49 pm
 
Forum: Investing - Theory, News & General
Topic: Mom & Pop still not investing in equities
Replies: 15
Views: 2198

Re: Emerging Markets

W. Bernstein considers EM one of the three fundamental asset classes (along with US and DM).

VG recommends owning EM in a total market fund. Otherwise the investor may be overwhelmed by EM volatility.
by pascalwager
Sat Dec 14, 2013 5:31 am
 
Forum: Investing - Theory, News & General
Topic: Emerging Markets
Replies: 35
Views: 3376

Re: Vanguard Inconsistency

I agree with the OP. The messages are inconsistent. I don't buy the "businesses doing business overseas" argument, because the reverse is also true. I also do not really look at "currency risk" as a true risk factor, since it is just as likely to work in the investor's favor. Co...
by pascalwager
Mon Dec 02, 2013 1:34 am
 
Forum: Investing - Theory, News & General
Topic: Vanguard Inconsistency
Replies: 23
Views: 2574

Re: Vanguard Inconsistency

Eugene Fama recommends total stock market investing for the average investor, but leaves the domestic/foreign split to individual taste.
by pascalwager
Sun Dec 01, 2013 11:08 pm
 
Forum: Investing - Theory, News & General
Topic: Vanguard Inconsistency
Replies: 23
Views: 2574

Re: Portfolio Allocation - For Family - w/Jack Bogle Intervi

Yes abuss, 40% seems much too high for a sector fund and REIT valuations are currently high. W Bernstein advises staying away now unless you have strong hands and have a long time horizon. Swensen considers REITs as a kind of hybrid bond/equity with only moderate expected returns.
by pascalwager
Fri Nov 29, 2013 4:40 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Allocation - For Family - w/Jack Bogle Interview
Replies: 6
Views: 922

Re: Portfolio Allocation - For Family - w/Jack Bogle Intervi

Bogle mentioned putting up to a third (33%) of equities in REITs. But I thought he was proposing all of the bond/equity yield-enhancers for retirees who needed the extra yield to make ends meet, not for the average investor.

(Ferri considers 10% of equities the upper limit for REITs.)
by pascalwager
Thu Nov 28, 2013 4:46 am
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Allocation - For Family - w/Jack Bogle Interview
Replies: 6
Views: 922

Re: A Gem --"The Elements of Investing"

Ellis recommends the dividend fund and EMB only for those who are convinced that they need a bond income stream in retirement. For others, he recommends no bonds until after age 70, and then only a gradual accumulation of short-term bonds. I sure am not seeing that . This is what I am seeing. Bonds...
by pascalwager
Thu Nov 28, 2013 1:23 am
 
Forum: Investing - Theory, News & General
Topic: A Gem --"The Elements of Investing"
Replies: 32
Views: 8393

Re: RTM the ninth wonder of the world

Larry,

You mentioned recently that you sold all of your overvalued REIT. Why didn't you just rebalance out of your REIT? How do we separate proper use of RTM observations from actual market timing? If valuations are high, do we refrain from adding new money–and isn't this market timing?
by pascalwager
Tue Nov 26, 2013 4:06 pm
 
Forum: Investing - Theory, News & General
Topic: RTM the ninth wonder of the world
Replies: 15
Views: 1814

Re: RTM the ninth wonder of the world

In fact, as we have discussed, investor behavior tends to exhibit the trait known as recency — an investment trait that most often dooms investors to poor outcomes. The result is that investors follow a strategy of buying high and selling low — not exactly a recipe for investment success. Then, con...
by pascalwager
Tue Nov 26, 2013 4:14 am
 
Forum: Investing - Theory, News & General
Topic: RTM the ninth wonder of the world
Replies: 15
Views: 1814

Re: US/International Allocation help!!!!

VG TWS is more expensive than using TSM and TISM. Also it's much less diversified and includes sampling risk. I just set TSM-TISM at world market proportions and have let them run. After a few years you can readjust if you want. You can use the monthly domestic/foreign proportions shown on the VG TW...
by pascalwager
Mon Nov 25, 2013 3:41 am
 
Forum: Investing - Help with Personal Investments
Topic: US/International Allocation help!!!!
Replies: 19
Views: 1341

Re: A Gem --"The Elements of Investing"

Ellis recommends the dividend fund and EMB only for those who are convinced that they need a bond income stream in retirement. For others, he recommends no bonds until after age 70, and then only a gradual accumulation of short-term bonds.
by pascalwager
Mon Nov 25, 2013 3:17 am
 
Forum: Investing - Theory, News & General
Topic: A Gem --"The Elements of Investing"
Replies: 32
Views: 8393

Re: "Slice and Dicers"

I have two independent portfolios: 1) DFA size/value (59%) and 2) VG TSM-TISM (41%). I just use a domestic/foreign TWM weighting because I really don't know how to adjust for the greater risks and costs of foreign investments. Right now, I'm at 50/50 for both portfolios.
by pascalwager
Sat Nov 23, 2013 11:47 pm
 
Forum: Investing - Theory, News & General
Topic: "Slice and Dicers"
Replies: 39
Views: 2918

Re: Crazy Talk

I'm 71 and do have an I-bond, and plan to buy another in January. Otherwise, 96% of my fixed income is in cash. Total fixed income is 12.5% of portfolio, so I'm probably ahead of Ellis' suggested "bond" purchasing schedule. In one's seventies, I figure adding 4 or 5 percent bonds per year ...
by pascalwager
Tue Nov 19, 2013 4:11 am
 
Forum: Investing - Theory, News & General
Topic: Crazy Talk
Replies: 7
Views: 1757

Re: Advice on fixed income portion of portfolio

Instead of just thinking about the division between stocks and bonds, you might want to think in terms of risky and riskless . Then the riskless part of your portfolio is mainly the 33% (60 x 0.55) in savings bonds plus the short term treasury component of TBM. Most of TBM and the two corporate fund...
by pascalwager
Fri Nov 15, 2013 12:45 am
 
Forum: Investing - Help with Personal Investments
Topic: Advice on fixed income portion of portfolio
Replies: 12
Views: 1323

Re: Better Than Total Stock/Total Intern??

by LittleD » Wed Nov 13, 2013 3:56 pm Tapp wrote:Interesting article from Paul Merriman on Marketwatch today http://www.marketwatch.com/story/a-vang ... MW_popular Caveat: These ETF's are new but the mutual fund versions have been around for awhile... If you want to try something like Trev H's Ulti...
by pascalwager
Wed Nov 13, 2013 11:11 pm
 
Forum: Investing - Theory, News & General
Topic: Better Than Total Stock/Total Intern??
Replies: 10
Views: 1636

Re: The key to investment success

If valuations are too high, then what do you do with accumulating cash?
by pascalwager
Tue Nov 12, 2013 4:32 am
 
Forum: Investing - Theory, News & General
Topic: The key to investment success
Replies: 33
Views: 2958

Re: How many funds do you have in your portfolio?

Fourteen funds over five accounts.

VG TSM
VG TISM
DFA LV
DFA SV/MV
DFA Microcap
DFA ILV
DFA ISC
DFA EM
by pascalwager
Mon Nov 11, 2013 2:06 am
 
Forum: Investing - Theory, News & General
Topic: How many funds do you have in your portfolio?
Replies: 96
Views: 5735

Re: vanguard corporate bond index - new admiral classes?

Like some others, several of the bond funds are new to me. Maybe this is the VG best response to John Bogle's plea for a total corporate index fund. Personally, I follow W. Bernstein's advice to group corporate bonds with the risky assets (equities), and don't own any.
by pascalwager
Tue Nov 05, 2013 1:43 am
 
Forum: Investing - Theory, News & General
Topic: vanguard corporate bond index - new admiral classes?
Replies: 20
Views: 3432

Re: Approximating Total Intl Stock Market (ex-US) in Israel

You can use VG Total International Stock Market Fund (TISM) (see Portfolio & Management screen) to determine the relative proportions for EM and Canada. You're close right now. EM is currently about 18% and Canada about 7% of VG TISM. This process should work well for you.
by pascalwager
Fri Nov 01, 2013 10:49 pm
 
Forum: Investing - Theory, News & General
Topic: Approximating Total Intl Stock Market (ex-US) in Israel
Replies: 2
Views: 328
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