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Re: Interpreting Shiller's data

Ask him....and let us know.

robert.shiller AT yale.edu


Paul
by pkcrafter
Sat Apr 19, 2014 10:56 pm
 
Forum: Investing - Theory, News & General
Topic: Interpreting Shiller's data
Replies: 4
Views: 238

Re: 3 researched questions for you re: my portfolio & financ

Hi everyone, Wow, if I have a son in the future, I am going to have to give strong consideration to naming him Paul ( pkcrafter and windhog )! I really can't adequately express my gratitude to you for your time and advice. Thanks, but we haven't done THAT much. :happy I don't know very much about t...
by pkcrafter
Sat Apr 19, 2014 1:06 pm
 
Forum: Investing - Help with Personal Investments
Topic: 3 researched questions for you re: my portfolio & finances
Replies: 21
Views: 1210

Re: Need help, planning on making my first ever investment s

Welcome, Hey everyone! I need some help. I want to know if my plan sounds good or if there's anything important I'm not thinking about or considering. First, some background info: I'm 24 years old, zero debt, my income is about $34k, and I have $10k in savings. Instead of going out and buying a car...
by pkcrafter
Sat Apr 19, 2014 12:30 pm
 
Forum: Investing - Help with Personal Investments
Topic: Need help, planning on making my first ever investment soon.
Replies: 6
Views: 314

Re: Help with Investment Advice

Thanks Johm. What would be a more reasonable return rate? My parents are willing to do a flexible withdrawal (i.e. withdrawing less or none at all on years where the market does not perform as well). Nole In your opening post you said parents would like a portfolio that would generate 5-6% a year. ...
by pkcrafter
Sat Apr 19, 2014 11:32 am
 
Forum: Investing - Help with Personal Investments
Topic: Help with Investment Advice
Replies: 8
Views: 456

Re: 3 researched questions for you re: my portfolio & financ

How much, if any, are you contributing to retirement this year? As for the 10k in taxable, that's retirement money? If so, sign up for your 401k and use the 10k for living expenses while you add an equivalent amount from your monthly income check to add to the 401k. This will effectively transfer th...
by pkcrafter
Sat Apr 19, 2014 10:44 am
 
Forum: Investing - Help with Personal Investments
Topic: 3 researched questions for you re: my portfolio & finances
Replies: 21
Views: 1210

Re: How not to invest

Thanks for the story. I'm afraid Jeff is giving engineers a bad name. While Steckbeck said a supervisor at Clermont Wealth Strategies advised him against investing in TVIX in February 2012, he bought 4,000 shares the next month from his self-managed brokerage account. The adviser, whom Steckbeck dec...
by pkcrafter
Sat Apr 19, 2014 9:28 am
 
Forum: Investing - Theory, News & General
Topic: How not to invest
Replies: 3
Views: 905

Re: 3 researched questions for you re: my portfolio & financ

I also re-read my "question #1" just now. :oops: Next time, I need to get more sleep or wait a few days between drafting an entry to posting it. Here's my attempt to clarify my questions from #1. (I've tried to read the posts in the forum on this topic in the past, but am still confused, ...
by pkcrafter
Sat Apr 19, 2014 12:51 am
 
Forum: Investing - Help with Personal Investments
Topic: 3 researched questions for you re: my portfolio & finances
Replies: 21
Views: 1210

Re: First of two parter on what is risk

Nedsaid, volatility may be or may not be defined as risk by the person experiencing it. Volatility is normal, but volatility can transform itself into Bernstein's deep risk. Mutual fund volatility is also normally presented as one standard deviation, i.e. movement of returns 68% of the time, therefo...
by pkcrafter
Fri Apr 18, 2014 12:20 am
 
Forum: Investing - Theory, News & General
Topic: First of two parter on what is risk
Replies: 26
Views: 1624

Re: First of two parter on what is risk

BobK, ... Frank Knight clearly distinguishes uncertainty from risk: In economics, Knightian uncertainty is risk that is immeasurable, not possible to calculate. Knightian uncertainty is named after University of Chicago economist Frank Knight (1885–1972), who distinguished risk and uncertainty in h...
by pkcrafter
Fri Apr 18, 2014 12:03 am
 
Forum: Investing - Theory, News & General
Topic: First of two parter on what is risk
Replies: 26
Views: 1624

Re: First of two parter on what is risk

BobK, we have another thread going which argues the definition of average return. The SEC uses "Average Annual Return" for geometric return, which isn't quite right, but the average investor is comfortable with it and accepts it. Frank Knight clearly distinguishes uncertainty from risk: In...
by pkcrafter
Thu Apr 17, 2014 2:42 pm
 
Forum: Investing - Theory, News & General
Topic: First of two parter on what is risk
Replies: 26
Views: 1624

Re: Draft email to investment advisor re outperforming Total

Susan, don't send the letter. You really have to be careful with comparisons. There is something called Dunn's Law, which says, "When an asset class does well, an index fund in that asset class does even better." Vanguard's S&P500 index fund is now in that position, and with the very s...
by pkcrafter
Thu Apr 17, 2014 1:50 pm
 
Forum: Investing - Help with Personal Investments
Topic: Draft email to investment advisor re outperforming Total Mar
Replies: 24
Views: 2347

Re: New Investor Portfolio/Advice

Yikes! Class C shares? Are you on good enough terms with your employer to discuss his choice of SIMPLE plans? This is bad for him as well as the employees. 1. I’m not sure what I should do with the $23k cash and the additional $600/month I am setting aside? Should I open a taxable account? Pay off s...
by pkcrafter
Thu Apr 17, 2014 1:06 pm
 
Forum: Investing - Help with Personal Investments
Topic: New Investor Portfolio/Advice
Replies: 6
Views: 406

Re: Need Help Setting Up Port For Father

Lifestrategy Income @ 20% equity or Target Retirement Income at 30%. Higher equity will work too, but not needed. If you want to go higher, then LS conservative @ 40% or moderate, but I would not recommend anything higher. Doesn't sound like taxes will be a problem, but if he or you are concerned, t...
by pkcrafter
Thu Apr 17, 2014 10:46 am
 
Forum: Investing - Help with Personal Investments
Topic: Need Help Setting Up Port For Father
Replies: 7
Views: 325

Re: Help looking for ways to get to 50-50

Silly question, but why does your sister now want to up her AA from 36% to 50%? She can just use a different TR fund, or using TM balanced in taxable will get her 52/48. However, I agree with Wizard that keeping some cash is a good idea. She can also just buy enough TSM and/or TISM in taxable to get...
by pkcrafter
Thu Apr 17, 2014 10:32 am
 
Forum: Investing - Help with Personal Investments
Topic: Help looking for ways to get to 50-50
Replies: 18
Views: 1042

Re: New to investing, looking for insights

dratkinson wrote:
The TR 0.54% ER must be added to the ER of the underling funds


Schwab Managed Retirement Trust Fund 2050 III is a trust fund, so no ticker. Also, the 0.54% is the total ER for the fund.

https://www.schwabplan.com/FundDetail/SM350.pdf

Paul
by pkcrafter
Thu Apr 17, 2014 10:18 am
 
Forum: Investing - Help with Personal Investments
Topic: New to investing, looking for insights
Replies: 45
Views: 2631

Re: 401k in-service withdrawals

Most companies have a limit on in-service withdrawals. Two years is typical--check with your company. There may be other restrictions as well. Does your company provide a match? Your fund expenses are very high, but it's possible that all administrative fees are part of those expense ratios (ERs). S...
by pkcrafter
Thu Apr 17, 2014 9:43 am
 
Forum: Investing - Help with Personal Investments
Topic: 401k in-service withdrawals
Replies: 18
Views: 1022

Re: B-shares

Welcome,

Can you please provide the name(s) and tickers for one or two B class funds, and let us know how long you have held them.

Paul
by pkcrafter
Wed Apr 16, 2014 6:51 pm
 
Forum: Investing - Help with Personal Investments
Topic: B-shares
Replies: 6
Views: 421

Re: Why does Vanguard use average return iso compound annual

Where are people looking? The SEC instructions for a Prospectus are the instructions for a Form N-1A http://www.sec.gov/about/forms/formn-1a.pdf For a Fund (other than a money Market Fund or a Fund described in General Instruction C.3.(d)(iii)), provide the information in the following table with t...
by pkcrafter
Wed Apr 16, 2014 3:52 pm
 
Forum: Investing - Theory, News & General
Topic: Why does Vanguard use average return iso compound annual?
Replies: 99
Views: 4106

Re: I don't understand whether there are costs to rebalancin

Very difficult to provide suggestions without knowing more. For instance, no income? Are you retired and only income from investments?

Take a look at this suggested formatting:

http://www.bogleheads.org/forum/viewtopic.php?f=1&t=6212

Paul
by pkcrafter
Wed Apr 16, 2014 2:53 pm
 
Forum: Investing - Help with Personal Investments
Topic: I don't understand whether there are costs to rebalancing
Replies: 16
Views: 1134

Re: Japan Does not Show That Stocks are Dangerous

Today in the U.S. we see CAPE 10 at 25. By historical standards that is high, in fact, other than a very recent run to 25, the only other 2 times it was exceeded resulted in run-away rises in CAPE 10, 1929 and 1999. Judging by this, we should be seeing most investors backing off equity allocations, ...
by pkcrafter
Wed Apr 16, 2014 10:53 am
 
Forum: Investing - Theory, News & General
Topic: Japan Does not Show That Stocks are Dangerous
Replies: 79
Views: 3857

Re: Why does Vanguard use average return iso compound annual

You're right, Dave, that one word does make a difference. I actually thought Vanguard used "total" for their returns, but nope.

Paul
by pkcrafter
Tue Apr 15, 2014 11:56 pm
 
Forum: Investing - Theory, News & General
Topic: Why does Vanguard use average return iso compound annual?
Replies: 99
Views: 4106

Re: Japan Does not Show That Stocks are Dangerous

Japan Does not Show That Stocks are Dangerous Yes, it does. Japan shows that a market crash can last long enough to convert shallow risk into deep risk. For those looking at Japan and coming up with reasons after the fact is kind of like how black swans are always reasoned out--after the fact. Is a...
by pkcrafter
Tue Apr 15, 2014 11:24 pm
 
Forum: Investing - Theory, News & General
Topic: Japan Does not Show That Stocks are Dangerous
Replies: 79
Views: 3857

Re: Why does Vanguard use average return iso compound annual

KyleAAA wrote: But if you label it correctly, the laymen who intuitively assume average annual return = CAGR would be confused. Hmm, maybe. I think if you use anything but average annual return the "laymen" would be confused, call the SEC and ask why they are using some confusing term. Why...
by pkcrafter
Tue Apr 15, 2014 10:52 pm
 
Forum: Investing - Theory, News & General
Topic: Why does Vanguard use average return iso compound annual?
Replies: 99
Views: 4106

Re: Can this 4% CD be trusted?

Pinhead, I did a little research on Sun Cities and it was enough to say, be careful. Call them and see if they want you to come in with your checkbook. :happy

Paul
by pkcrafter
Tue Apr 15, 2014 10:12 pm
 
Forum: Investing - Theory, News & General
Topic: Can this 4% CD be trusted?
Replies: 21
Views: 2402

Re: Stocks: How Bad It Can Get

Thanks Taylor, your story still conveys the dramatic impact that accompanies a very sever market fall. I've copied it and it should be required reading for all new investors. And now is an excellent time to remind investors. And for those young eager investors who can't wait for an 80-90% drop so th...
by pkcrafter
Tue Apr 15, 2014 9:18 pm
 
Forum: Investing - Theory, News & General
Topic: Stocks: How Bad It Can Get
Replies: 72
Views: 5332

Re: Target Funds

I want to second John's suggestion for choosing TR funds based on desired asset allocation rather than date. The Vanguard fund you hold is 90% stocks and the TSP fund is 75% stocks. You haven't provided any information, so it's difficult to add any additional comments. If you feel like getting a rev...
by pkcrafter
Tue Apr 15, 2014 8:07 pm
 
Forum: Investing - Help with Personal Investments
Topic: Target Funds
Replies: 4
Views: 539

Re: Stocks: How Bad It Can Get

Note that the S&P500 was down about 43% in the dotcom crash, not <40% as the chart shows. The NASDAQ was down about 78%...and lots of investors performance chasers were heavily invested in the NASDAQ. Chart of S&P500 returns going back to 1928. http://pages.stern.nyu.edu/~adamodar/New_Home_P...
by pkcrafter
Tue Apr 15, 2014 2:17 pm
 
Forum: Investing - Theory, News & General
Topic: Stocks: How Bad It Can Get
Replies: 72
Views: 5332

Re: Mother Of Bog! I'm Uncertain/Frightened To Buy Fund

Wolf, you said you did not want to spend down the 21,500/year, but it would seem to be your best strategy. You are getting 1400/month and need another 1100, so take it from the 21,500. Doing that still leaves you with 8300/year you can add to your retirement account. Doing it this way allows your po...
by pkcrafter
Tue Apr 15, 2014 12:01 pm
 
Forum: Investing - Help with Personal Investments
Topic: I Really Would Appreciate Your Advice!
Replies: 72
Views: 2685

Re: What does "invest in the market mean"

Paul yes the Altucher article was the one I was referring to Ok, here are two quotes: WHAT ABOUT MUTUAL FUNDS? No. Mutual funds, and the bank representatives that push them, consistently lie about the fees they are charging. I know this from experience. Altucher's knowledge is mostly accurate in hi...
by pkcrafter
Mon Apr 14, 2014 6:10 pm
 
Forum: Investing - Help with Personal Investments
Topic: What does "invest in the market mean"
Replies: 11
Views: 870

Re: What does "invest in the market mean"

Welcome cetncetn,

I wonder if this is the article you are referring to?

http://www.businessinsider.com/money-cheat-sheet-2014-4''

Paul
by pkcrafter
Mon Apr 14, 2014 12:04 pm
 
Forum: Investing - Help with Personal Investments
Topic: What does "invest in the market mean"
Replies: 11
Views: 870

Re: The Case for Dividend Stocks in Retirement (article)

Taking dividends is a withdrawal of total return, but it removes the option of the investor deciding on when to make the withdrawal. For instance, you will get a withdrawal during a bear market when you should not be withdrawing from equity. If you needed to create your own dividends, you could have...
by pkcrafter
Mon Apr 14, 2014 11:28 am
 
Forum: Investing - Theory, News & General
Topic: The Case for Dividend Stocks in Retirement (article)
Replies: 27
Views: 2231

Re: SCV premium is a history/math story, its not scientific

Rodc wrote:
So the "must" is much too strong.

Ah, yes, I "must" agree.

Paul
by pkcrafter
Mon Apr 14, 2014 11:04 am
 
Forum: Investing - Theory, News & General
Topic: SCV premium is a history/math story, its not scientific
Replies: 46
Views: 2237

Re: SCV premium is a history/math story, its not scientific

Rodc, are you saying this is not true?

stocks are more risky, they must pay out more than bonds to get people to take the risk of stocks.



Paul
by pkcrafter
Mon Apr 14, 2014 10:39 am
 
Forum: Investing - Theory, News & General
Topic: SCV premium is a history/math story, its not scientific
Replies: 46
Views: 2237

Re: What exactly is a risk premium?

Welcome, good first post. I think answers to your questions have been provided. I'd only add that risk/reward is always a trade-off and it isn't very prudent to take as much risk as possible in the hopes of getting higher returns. Balance is the key. Don't forget what risk means. The risk is you wil...
by pkcrafter
Mon Apr 14, 2014 10:20 am
 
Forum: Investing - Theory, News & General
Topic: What exactly is a risk premium?
Replies: 14
Views: 975

Re: What % of stock market "drive" is gambling?

Here's some definitions. The best way to "invest" and avoid gambling is to use index funds, hold long term, and take advantage of the power of compounding. Doing so ultimately reduces the "gamble" to faith in the capitalistic system. How many people do this? Probably less than 20...
by pkcrafter
Mon Apr 14, 2014 9:55 am
 
Forum: Investing - Theory, News & General
Topic: What % of stock market "drive" is gambling?
Replies: 36
Views: 3419

Bogle speaks out about Vanguard

This is from an article, June 2013. Apologies if it's been posted before. If you ask John Bogle a question, you're going to get an honest answer. Adding wattage to Bogle’s electrical storm was a very game Don Phillips, a Morningstar, Inc. managing director, who seemed to revel in asking Bogle the ha...
by pkcrafter
Mon Apr 14, 2014 9:22 am
 
Forum: Investing - Theory, News & General
Topic: Bogle speaks out about Vanguard
Replies: 2
Views: 1186

Re: Howard Marks latest memo

To obtain the market return you don't need to dare to be great but if you are an enterprising investor that is exactly what you need to do.

What % of average investors do you think will earn a better than average return by trying to be great?


Paul
by pkcrafter
Sun Apr 13, 2014 1:25 pm
 
Forum: Investing - Theory, News & General
Topic: Howard Marks latest memo
Replies: 12
Views: 1287

Re: what exactly is the "boring SWAN" portfolio?

cfs, I like the SWAN idea, and this too--
Bottom line, really boring and I sleep well at night--no big deal.

Hmm, a Really Boring Portfolio would be a RBP, not unlike Livesoft's RBD.

Paul
by pkcrafter
Sat Apr 12, 2014 11:28 pm
 
Forum: Investing - Help with Personal Investments
Topic: what exactly is the "boring SWAN" portfolio?
Replies: 7
Views: 1187

Re: Why does Vanguard use average return iso compound annual

Jack wrote: There is no ambiguity. If there were no ambiguity, we wouldn't be having this long conversation. Why would anyone assume an arithmetic average that provides no useful information? Because that's the way it's labeled? Label it correctly and there would be no confusion--even the Vanguard e...
by pkcrafter
Sat Apr 12, 2014 6:37 pm
 
Forum: Investing - Theory, News & General
Topic: Why does Vanguard use average return iso compound annual?
Replies: 99
Views: 4106

Re: Why does Vanguard use average return iso compound annual

The SEC instructions are this: calculate the Fund's average annual total return by finding the average annual compounded rates of return This is mixing up two different definitions, so it's confusing. This is mixing up two different definitions, so it's confusing. They are not different definitions...
by pkcrafter
Sat Apr 12, 2014 4:29 pm
 
Forum: Investing - Theory, News & General
Topic: Why does Vanguard use average return iso compound annual?
Replies: 99
Views: 4106

Re: Why does Vanguard use average return iso compound annual

I tend to agree with Frans on this one, but it ultimately is not the Vanguard employees' fault or Vanguards. The fault lies with the SEC. The SEC instructions are this: calculate the Fund's average annual total return by finding the average annual compounded rates of return This is mixing up two dif...
by pkcrafter
Sat Apr 12, 2014 3:06 pm
 
Forum: Investing - Theory, News & General
Topic: Why does Vanguard use average return iso compound annual?
Replies: 99
Views: 4106

Re: Investing in REIT for a future house?

Johnny wrote: Overall, the question is, does investing in REITs for a home down payment make sense? In a word, NO. REITs are 100% stock and substantially more volatile than the total stock market. The general rule for short therm savings is if you need a specified amount in 5 years, then don't use e...
by pkcrafter
Sat Apr 12, 2014 11:41 am
 
Forum: Investing - Help with Personal Investments
Topic: Investing in REIT for a future house?
Replies: 4
Views: 411

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

Hi - I am trying to find smart ways to generate even a little bit of alpha (net of taxes and fees) above what a standard diversified equity portfolio would generate. plevine, I look at it this way. If you use broadly diversified low cost index funds and don't mess around, you will get your fair sha...
by pkcrafter
Fri Apr 11, 2014 8:53 pm
 
Forum: Investing - Theory, News & General
Topic: Can I get some alpha? (DFA / Wealthfront)
Replies: 58
Views: 2916

Re: Howard Marks latest memo

Thanks for posting the link. How has Marks influenced your investing?

Paul
by pkcrafter
Fri Apr 11, 2014 1:35 pm
 
Forum: Investing - Theory, News & General
Topic: Howard Marks latest memo
Replies: 12
Views: 1287

Re: New to investing, looking for insights

I'm aware it's free money lol...my point was everyone keeps telling me about it and how stupid I am for not doing it. I have been researching the stocks I was interested in buying. I guess I should have specified I have gone over scenarios and budgets and plans on paper and spreadsheets basically n...
by pkcrafter
Fri Apr 11, 2014 12:10 pm
 
Forum: Investing - Help with Personal Investments
Topic: New to investing, looking for insights
Replies: 45
Views: 2631

Re: Improvement needed

Sorry to hear you are in this situation, but you a fine example why we never recommend people invest with friends or family members. It's nice of you to help your friend grow his retirement, but if he's really a friend he will understand your doing this yourself.

Paul
by pkcrafter
Fri Apr 11, 2014 11:39 am
 
Forum: Investing - Help with Personal Investments
Topic: Improvement needed
Replies: 42
Views: 1712

Re: New to investing, looking for insights

the mortgage is in my name, but both of our names are on the deed. This was unwise, but I hope it works out. interest rates are anywhere between 1% and 7% (I have them "consolidated" to make one payment instead of several others). It would have been better to not consolidate these loans b...
by pkcrafter
Thu Apr 10, 2014 11:06 pm
 
Forum: Investing - Help with Personal Investments
Topic: New to investing, looking for insights
Replies: 45
Views: 2631

Re: New to investing, looking for insights

Welcome, glad you are reading The Bogleheads' Guide to Investing , but you still don't have your ducks in a row. So, now that you are there, start with this link: http://www.bogleheads.org/wiki/Getting_started Hi everyone. To start, I just want to give you some background on myself. I am 27 and hav...
by pkcrafter
Thu Apr 10, 2014 9:38 pm
 
Forum: Investing - Help with Personal Investments
Topic: New to investing, looking for insights
Replies: 45
Views: 2631

Re: "Why do investors make bad choices?"

Thanks for the link. This should make it clear that investors will make mistakes, even if very knowledgeable about behavior. The problem is we can think very rationally when stress and emotions aren't in play, but when they are, rationality gets thrown out the window.

Paul
by pkcrafter
Wed Apr 09, 2014 2:01 pm
 
Forum: Investing - Theory, News & General
Topic: "Why do investors make bad choices?"
Replies: 23
Views: 1587

Is Alpha Dead?

Beating The Market Has Become Almost Impossible

Interesting 5-part article from Institutional Investor

http://www.institutionalinvestor.com/Article/3256074/Beating-the-Market-Has-Become-Nearly-Impossible.html?ArticleId=3256074&p=1#.U0OEGVebdig

Paul
by pkcrafter
Tue Apr 08, 2014 1:24 am
 
Forum: Investing - Theory, News & General
Topic: Is Alpha Dead?
Replies: 38
Views: 2114
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