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Re: Did I trigger a wash sale?

HeadSpinning wrote:If I just sold some individual stocks and bought Total Market ETF right away does that count as a wash sale?


No. There has to be a loss and the replacement shares have to be substantially identical.
by rkhusky
Sun Apr 26, 2015 8:16 pm
 
Forum: Investing - Help with Personal Investments
Topic: Did I trigger a wash sale?
Replies: 2
Views: 173

Re: Poll: Effective average Adjusted Livesoft tax rate?

I didn't expect to see anybody with ALI > $160K to have <=5% rate, and that is true so far. Looks like we exceeded your expectations at 4.2%. Adding in employer contributions to health insurance, drops us to 3.9%. Adding in employer contributions to SS+Medicare drops us to 3.8%. Having children hel...
by rkhusky
Sat Apr 18, 2015 12:54 pm
 
Forum: Personal Finance (Not Investing)
Topic: Poll: Effective average Adjusted Livesoft tax rate?
Replies: 67
Views: 4669

Re: Difficult to answer tax and residency question

Am I not subject to a state tax audit from a state I have only lived in but never worked in? Or am I subject to a state tax audit from a state I never lived in or worked in but had a driver's license and car insurance in? Don't know this for sure, but one would hope that states use the same rules f...
by rkhusky
Tue Apr 07, 2015 8:00 am
 
Forum: Personal Finance (Not Investing)
Topic: Difficult to answer tax and residency question
Replies: 19
Views: 1222

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

Whatever you do, don't bail when your stocks crash. If you have a strong stomach, it is fine to be in 100% stocks. But you should still have a 3-6 month cash emergency fund on the side. However, if you are within a decade of retirement, I'd suggest having at least enough short-term bonds or cash to...
by rkhusky
Tue Apr 07, 2015 6:51 am
 
Forum: Investing - Theory, News & General
Topic: Switching 40% of my portfolio to bonds: just can't do it.
Replies: 52
Views: 7078

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

BogleBoogie wrote:
rkhusky wrote:If stocks drop by 50%, with what would you use to buy stocks cheap?


Market timer.


No. You rebalance from bonds to stocks when your rebalancing bands are breached. Buy low, sell high. If you have no bonds, you can't rebalance from bonds to stocks.
by rkhusky
Tue Apr 07, 2015 6:45 am
 
Forum: Investing - Theory, News & General
Topic: Switching 40% of my portfolio to bonds: just can't do it.
Replies: 52
Views: 7078

Re: Please help a greenhorn out with asset allocation!

You can also put tax-exempt bonds in a taxable account. A simple solution might be to use TSM and VWITX in taxable in the same ratio as you have in the Roth. Since you want less Int'l than Vanguard is currently putting in their TR funds (40% of stock, up from 30% last year), that should help reduce ...
by rkhusky
Mon Apr 06, 2015 11:16 am
 
Forum: Investing - Help with Personal Investments
Topic: Please help a greenhorn out with asset allocation!
Replies: 5
Views: 504

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

If stocks drop by 50%, with what would you use to buy stocks cheap?
by rkhusky
Mon Apr 06, 2015 11:07 am
 
Forum: Investing - Theory, News & General
Topic: Switching 40% of my portfolio to bonds: just can't do it.
Replies: 52
Views: 7078

Re: How to find the true value of a stock

No investment has intrinsic value. The value is always what someone else is willing to pay for it, whether it is gold, land, houses, paintings, antiques, stocks or bonds.
by rkhusky
Fri Apr 03, 2015 10:05 pm
 
Forum: Investing - Theory, News & General
Topic: How to find the true value of a stock
Replies: 17
Views: 1494

Re: Have P/E Ratios Affected Your Asset Allocation?

The problem is the timing. While high valuations may indicate a drop in the future, the question is when. I don't have an infinite investing time horizon. And I'm not rich, so I will need to spend a good chunk of my retirement portfolio.
by rkhusky
Fri Apr 03, 2015 9:56 am
 
Forum: Investing - Theory, News & General
Topic: Have P/E Ratios Affected Your Asset Allocation?
Replies: 52
Views: 2686

Re: Asset Allocation differences

I would go back 30 years and also look at best/worst 5 year and 10 year returns. You will probably find that, in general, adding bonds decreases both max gains and max losses in a fairly monotonic fashion. There might be a bit of dip around 90% bonds. Check out these pages: https://personal.vanguard...
by rkhusky
Fri Apr 03, 2015 9:44 am
 
Forum: Investing - Theory, News & General
Topic: Asset Allocation differences
Replies: 22
Views: 1745

Re: IRS Identity Theft Tax Fraud

After hearing about friends, relatives, and colleagues getting stung, this year was our turn. I am guessing it is as a result of the Anthem hacking, but my accountant called me today to inform me that my electronic tax filing was rejected because my tax return had (allegedly) already been filed. Ug...
by rkhusky
Fri Apr 03, 2015 9:39 am
 
Forum: Personal Consumer Issues
Topic: IRS Identity Theft Tax Fraud
Replies: 47
Views: 4108

Re: The random stock portfolio bogey - beating the monkey

Maynard F. Speer wrote:I think my average ER is about 0.6%, but I may be able to get it down 0.5 .. So could be cheaper

Since you can probably get a cap weighted 3-fund portfolio for 0.1%, are your returns providing an extra 0.5% every year on average?
by rkhusky
Fri Apr 03, 2015 9:35 am
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

Maynard F. Speer wrote: But personally I've done better avoiding cap-weighted indexes (but to some extent the difference is a drop in the ocean over a large, diversified portfolio)


Are you avoiding indexes or cap-weighting or both? If you don't have cap-weighting, what is your average ER?
by rkhusky
Thu Apr 02, 2015 7:41 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

Wonder what their tables would look like with costs taken into account? Total return includes costs. Well, Arnott reports that the monkey added 160 bps annually to the returns of the index. So I guess that wouldn't be too hard to figure out. If the monkey costs you more than an extra percent or so ...
by rkhusky
Thu Apr 02, 2015 4:19 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

Of course, we know that Arnott's digital monkey also beat the cap-weighted index 99 out of 100 trials. So, Little Jimmy's success isn't just a fluke. You should have such a batting average, Joe Dimaggio. http://www.q-group.org/wp-content/uploads/2014/01/2013fall_Hsu.pdf Gotta luv the final paragrap...
by rkhusky
Thu Apr 02, 2015 2:34 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: Combined Brokerage account with TSP

I have a question regarding TSP as well. The funds do not appear to pay dividends. Why is this? Is this why it is better to hold the G fund in TSP? My Total Bond Index Fund re-invests dividends monthly. The TSP stock funds pay no dividends, is it clearly an advantage to hold the equivalent funds in...
by rkhusky
Thu Apr 02, 2015 9:18 am
 
Forum: Investing - Help with Personal Investments
Topic: Combined Brokerage account with TSP
Replies: 12
Views: 772

Re: $1.5M in 401K. What to do with it at retirement?

Vanguard Target Retirement Income.
by rkhusky
Thu Apr 02, 2015 7:13 am
 
Forum: Investing - Help with Personal Investments
Topic: $1.5M in 401K. What to do with it at retirement?
Replies: 15
Views: 4403

Re: Multi-state tax puzzle

Typical issues in this situation: some random state's revenue agency sends you a strongly worded letter stating that you owe money. You send them your federal return, and the state return, and tell them to get lost. I wouldn't send them my tax returns. I would just send a letter stating that no wor...
by rkhusky
Thu Apr 02, 2015 7:10 am
 
Forum: Personal Finance (Not Investing)
Topic: Multi-state tax puzzle
Replies: 25
Views: 1172

Re: Combined Brokerage account with TSP

Actually, 80% C + 20% S equals VTSAX. So, you have only 1% extra tilt to small cap from the excess S Fund.

And it looks like your Int'l allocation is 17% of stocks, which a bit lower than many recommend.
by rkhusky
Wed Apr 01, 2015 2:36 pm
 
Forum: Investing - Help with Personal Investments
Topic: Combined Brokerage account with TSP
Replies: 12
Views: 772

Re: The random stock portfolio bogey - beating the monkey

When you think about it, cap-weighting flies in the face of the re-balancing mantra. Everybody on the board seems to believe that it makes sense to rebalance between assets; i.e., sell the better performing assets to buy more of the worse performing assets. But the cap-weighting methodology doesn't...
by rkhusky
Wed Apr 01, 2015 2:34 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: NJ Exit Tax

Perhaps remain a NJ resident until after the sale.
by rkhusky
Wed Apr 01, 2015 10:59 am
 
Forum: Personal Finance (Not Investing)
Topic: NJ Exit Tax
Replies: 3
Views: 590

Re: Muni fund dividends considered income

Diversified muni fund dividends do not cause my federal AGI to increase, therefore my federal tax bracket is not affected. My state taxes muni income unless the muni bond is from my state. It may affect some MAGI calculations. See http://www.schwab.com/public/schwab/nn/articles/7-Tax-Traps-of-Munici...
by rkhusky
Wed Apr 01, 2015 6:57 am
 
Forum: Investing - Help with Personal Investments
Topic: Muni fund dividends considered income
Replies: 9
Views: 1067

Re: The random stock portfolio bogey - beating the monkey

Why does there need to be more value stocks in a random selection to see the value effect in the first place? This misses the point. Try this, restrict your selectable universe to growth stocks only. Then do a random selection. Then compare the P/B of the market weighted portfolio to your selection...
by rkhusky
Tue Mar 31, 2015 7:47 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

I am not sure that a truly random selection of stocks would always tend to be more value-y than the capitalization weighted average. It depends on how you figure the line between growth and value. Suppose I use Price/Book to figure value/growth and further that stocks have a uniform distribution of...
by rkhusky
Tue Mar 31, 2015 3:09 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

Back to beating the monkey, I understand that a monkey basket of stocks will, compared with a capitalization weighted index, tend to be overweight in mid and small cap stocks. Just based on the law of averages, that is inevitable. However, is there anything that requires the basket to be overweight...
by rkhusky
Mon Mar 30, 2015 6:57 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

I believe that if buyers and sellers both have access to the same information when executing trades, then the market is efficient and stocks are fairly priced. Just because one party is speculating about the future does not make the market inefficient. Just because one party guesses wrong about the ...
by rkhusky
Mon Mar 30, 2015 10:23 am
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

Well with market returns for the next 15-20 years looking rather uninspiring, it may be wise to think about whether you can achieve better doing something different .. When bond yields say zero confidence in the economic recovery, and stock prices say overconfidence, the market itself is sending ve...
by rkhusky
Mon Mar 30, 2015 7:52 am
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

Of course, the catch with the monkey is that a randomly selected stock portfolio includes many more smallcap stocks than a cap-weighted portfolio. This increases the risk (volatility) of the monkey portfolio and the tracking error vs. cap-weighting. There is also the matter of the higher trading co...
by rkhusky
Mon Mar 30, 2015 7:49 am
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: IRA And 401k?

Yes to both. You cannot contribute more than your taxable compensation.
by rkhusky
Mon Mar 30, 2015 7:33 am
 
Forum: Personal Finance (Not Investing)
Topic: IRA And 401k?
Replies: 14
Views: 793

Re: The random stock portfolio bogey - beating the monkey

As a thought experiment, suppose you had a standard 3-fund portfolio with Total Stock, Total Int'l Stock, and Total Bond, with AA of (50, 20, 30) respectively. Now suppose you wanted to replace the stock funds with Total Stock EW, Total Int'l Stock EW and Total Bond (EW=equal weight). What would you...
by rkhusky
Mon Mar 30, 2015 7:24 am
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

This sort of reminds me of a trick I used to play on the kids, but doesn't work anymore. Take a cookie and break it into 8 pieces, give them the choice between 4 pieces or 1 full cookie. It didn't take long before they realized that 1 big cookie was more than 4 small pieces of cookie.
by rkhusky
Sat Mar 28, 2015 8:26 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

Most of it is allocated to a few mega-cap stocks. That's wrong. The top ten stocks of Vanguard's Total Stock Market make up 14% of the fund. Ten is more than a few and 14% is not even close to being most. The top ten stocks are Apple Inc., Exxon Mobil Corp., Microsoft Corp., Google Inc., Johnson &a...
by rkhusky
Fri Mar 27, 2015 9:29 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

From the article I read recently, the suggestion was simply to sell once a year, and invest the proceeds in a new "basket" of monkey stocks. If a few merge or are taken over, so be it. If all of them merged into one, either ride it out until the end of the year or sell that one giant comp...
by rkhusky
Fri Mar 27, 2015 6:27 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

There are two questions: which stocks to own and how much of each stock. How do you handle inflows/outflows? Do you buy/sell based on the current weightings or do you buy/sell based on equal weighting? Do you maintain equal weighting? There are apt to be large swings in individual randomly selected ...
by rkhusky
Fri Mar 27, 2015 4:17 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: The random stock portfolio bogey - beating the monkey

I can understand the mechanics of an equal weight portfolio. Would that not "overweight" (based on market cap) micro, small, and midcap stocks? And wouldn't this mean an increase in volatility compared with the overall market based on market cap? I can't believe there is a "free lunc...
by rkhusky
Fri Mar 27, 2015 3:07 pm
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: TSP G Fund Possible Changes

The issue is not how I would invest my TSP funds after the G fund stops earning interest, but a higher level trade-off: - Keep money in the TSP, only for the G Fund access vs - Roll the TSP funds to Vanguard to start Roth conversions. I do not view the G fund as so special that I would miss an oppo...
by rkhusky
Fri Mar 27, 2015 2:46 pm
 
Forum: Investing - Theory, News & General
Topic: [TSP G Fund Possible Changes]
Replies: 21
Views: 1162

Re: TSP G Fund Possible Changes

To me, the G Fund is supposed to be the most stable and secure part of my allocation. Knowing that someone is even considering monkeying around with it is somewhat anxiety-provoking, especially in the setting of the recent proposals to change the military retirement system. The interview and other ...
by rkhusky
Fri Mar 27, 2015 11:29 am
 
Forum: Investing - Theory, News & General
Topic: [TSP G Fund Possible Changes]
Replies: 21
Views: 1162

Re: TSP G Fund Possible Changes

A similar post was just locked: https://www.bogleheads.org/forum/viewtopic.php?f=1&t=162105&newpost=2434085 I have not seen the other thread, but this one is very useful for me. I have to decide what to do with my TSP funds. The TSP allows only two withdrawal related actions, and I have to ...
by rkhusky
Fri Mar 27, 2015 11:14 am
 
Forum: Investing - Theory, News & General
Topic: [TSP G Fund Possible Changes]
Replies: 21
Views: 1162

Re: The random stock portfolio bogey - beating the monkey

By definition, any fund that is not a random equally dollar-weighted stock portfolio must be an actively managed portfolio: that also includes passive index funds since these are not random equally dollar-weighted either. For example, cap weighted index funds have more money allocated to some stock...
by rkhusky
Fri Mar 27, 2015 10:22 am
 
Forum: Investing - Theory, News & General
Topic: The random stock portfolio bogey - beating the monkey
Replies: 150
Views: 8909

Re: TSP G Fund Possible Changes

A similar post was just locked: viewtopic.php?f=1&t=162105&newpost=2434085
by rkhusky
Fri Mar 27, 2015 10:09 am
 
Forum: Investing - Theory, News & General
Topic: [TSP G Fund Possible Changes]
Replies: 21
Views: 1162

Re: 'Randomly Selected Stocks fund' vs Market cap Index...

A randomly selected portfolio will have more small companies, which in time will likely lead to higher returns if the number of stocks is large enough, but have more fluctuation and risk. I presume the OP is assuming an equal weight strategy, which is costly to run and does not handle stock mergers/...
by rkhusky
Fri Mar 27, 2015 9:10 am
 
Forum: Investing - Theory, News & General
Topic: 'Randomly Selected Stocks fund' vs Market cap Index...
Replies: 5
Views: 707

Re: Converted to Roth TSP and my taxes doubled!!

Plus, not having a RMD is a good thing. In some circumstances, having an RMD is a good thing, such as if pension and Social Security are low. If one has space in low tax brackets (compared to the tax rate that was paid to invest in a Roth), then having RMD's is beneficial. Having an RMD means that ...
by rkhusky
Fri Mar 27, 2015 8:03 am
 
Forum: Investing - Help with Personal Investments
Topic: Converted to Roth TSP and my taxes doubled!!
Replies: 17
Views: 1725

Re: Can you really know your AA until you've hit a bear mark

Frankly, I don't know if 2008 is a good example of investing in a bear market since it recovered so quick, especially if you were a young investor with a small portfolio. Although, in the midst of the downturn, one did not know if the market was going to come back. One should not assume that the nex...
by rkhusky
Fri Mar 27, 2015 7:32 am
 
Forum: Investing - Help with Personal Investments
Topic: Can you really know your AA until you've hit a bear market?
Replies: 74
Views: 5454

Re: Vanguard target fund vs age in bonds

Vanguard's TR2025 fund is 68% stock right now and the TR2030 fund is 75% stock. You could use either of these to be closer to your desired AA. If this is inside a tax-advantaged account, you can easily switch between the funds if one gets too aggressive or conservative. Note that age in bonds is a l...
by rkhusky
Fri Mar 27, 2015 7:25 am
 
Forum: Investing - Help with Personal Investments
Topic: Vanguard target fund vs age in bonds
Replies: 12
Views: 1494

Re: TurboTax Import Error from Vanguard: Who's Fault?

When you say last year's return, do you mean 2013 tax return that you filed in 2014 or is it 2014 tax return that you filed this year?
by rkhusky
Fri Mar 27, 2015 7:15 am
 
Forum: Personal Finance (Not Investing)
Topic: TurboTax Import Error from Vanguard: Who's Fault?
Replies: 16
Views: 1406

Re: Roth TSP or Regular TSP

VictoriaF did a deferred retirement. Some of her posts (such as this: http://www.bogleheads.org/forum/viewtop ... 2&t=135087) may be of interest.
by rkhusky
Thu Mar 26, 2015 11:59 am
 
Forum: Investing - Help with Personal Investments
Topic: Roth TSP or Regular TSP
Replies: 13
Views: 890

Re: Tax Loss Harvesting Wash Sale in Roth IRA

House Blend wrote:That loss is now permanently gone (since the replacement shares are in an IRA), so instead of claiming a loss of $5000 on your 2015 Schedule D, you will claim only $4987.

149600*(5000/150000) ~= 4987. The point being that you are losing $13, not $400.
by rkhusky
Thu Mar 26, 2015 11:52 am
 
Forum: Investing - Help with Personal Investments
Topic: Tax Loss Harvesting Wash Sale in Roth IRA
Replies: 16
Views: 1256

Re: Contribute to Traditional IRA?

It might be worthwhile if she expects 2015 to be a down year - i.e. in the 0%, 10% or 15% bracket.
by rkhusky
Thu Mar 26, 2015 11:41 am
 
Forum: Personal Finance (Not Investing)
Topic: Contribute to Traditional IRA?
Replies: 7
Views: 298

Re: G Fund Changes

Moving from 2020 to 2030 to avoid the G Fund would not be the best move, especially if you consider yourself risk-averse. Better to wait until the potential change takes place. Since the G Fund doesn't lose principal (unlike regular bond funds), there is no risk in waiting. If the change does take p...
by rkhusky
Thu Mar 26, 2015 11:30 am
 
Forum: Investing - Theory, News & General
Topic: [TSP G Fund Possible Changes]
Replies: 21
Views: 1162

Re: Tax Loss Harvesting Wash Sale in Roth IRA

The same thing happened to me. I sold about $150,000 worth of Vanguard's emerging markets and developed markets funds in my taxable account a couple weeks ago for a loss of $5000. Yesterday, the same funds in my Roth IRA reinvested a total of $400 in dividends. I would like to fix this if anything ...
by rkhusky
Thu Mar 26, 2015 7:01 am
 
Forum: Investing - Help with Personal Investments
Topic: Tax Loss Harvesting Wash Sale in Roth IRA
Replies: 16
Views: 1256
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