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Re: Edward Jones to Vanguard?

Sorry...not true. Once you get over (I think) $25,000....which the OP had....if he put it in at one time it is not 5.75%. Even if he put it in a little at a time....the first $25k would be at 5.75%....above that point (in his EJ account) it will be less than 5.75%. I HAD an account with EJones........
by shersch
Fri May 17, 2013 6:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: Edward Jones to Vanguard?
Replies: 22
Views: 2131

Re: Devil's advocate

Very cool question, but where does it end? Unchecked, you could follow that same trail of skepticism to give rise to claims like "you can't know the sun won't rise tomorrow," at least not if your only justification is that "it has risen every day in recorded history." The less iv...
by shersch
Fri May 17, 2013 6:35 pm
 
Forum: Investing - Theory, News & General
Topic: Devil's advocate [Investing for the longterm]
Replies: 14
Views: 996

Re: Edward Jones to Vanguard?

shersch- Actually...I see it constantly. When somebody quotes the upfront cost of buying and Edward Jones fund they always use the 5.75% front load number. I am not talking about selling another Templeton type fund.....I am talking regular American Funds kind of stuff. If you start up a fund...say ...
by shersch
Fri May 17, 2013 6:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: Edward Jones to Vanguard?
Replies: 22
Views: 2131

Re: Edward Jones to Vanguard?

There seems to be an overwhelming misconception that EJones charges 5.75% on EVERYTHING right up front... I don't see that anyone propounded that view. The fact is, all of the funds listed are in fact A shares with a 5.75% load. I've seen plenty of shares sold by EJ brokers that were lower [lots of...
by shersch
Fri May 17, 2013 4:55 pm
 
Forum: Investing - Help with Personal Investments
Topic: Edward Jones to Vanguard?
Replies: 22
Views: 2131

Re: Total Bond or combination

My understanding is that the duration of the GNMA fund will start rising as soon as mortgage rates start rising because people will no longer be refinancing their low interest mortgages unless they are forced to sell their homes when they move. Right now the duration is short because of all the ref...
by shersch
Fri May 17, 2013 3:17 pm
 
Forum: Investing - Theory, News & General
Topic: Total Bond or combination
Replies: 9
Views: 1057

Re: Vanguard Should Have Passive Funds, Without Indexes

We all know that cap-weighted indexing has its flaws. Telegraphing the piling on of indexed-assets to BRKA, dropping positions wholesale because they are no longer constituents of the benchmark...all valid, but let us not forget that matching the market less costs still beats the pants off of 85%+ o...
by shersch
Fri May 17, 2013 1:51 pm
 
Forum: Investing - Theory, News & General
Topic: Vanguard Should Have Passive Funds, Without Indexes
Replies: 13
Views: 1307

Re: REIT vs other sector funds for rebalancing

REIT's performance characteristics add diversification for me within the equity space. I just did a comparison chart on Yahoo It looks like Energy and Precious Metal & Mining are less correlated with the S&P 500 than REITS. It looks like Health Care is more correlated. So if you want divers...
by shersch
Fri May 17, 2013 1:41 pm
 
Forum: Investing - Theory, News & General
Topic: REIT vs other sector funds for rebalancing
Replies: 14
Views: 1242

Re: Gold

There's some interesting research being done on whether gold is even the optimal hedge against "surprise" inflation. http://news.morningstar.com/articlenet/article.aspx?id=541440 Assuming unexpected inflationary shocks are genuine phenomena, I'm still not convinced it's worth the cost to t...
by shersch
Fri May 17, 2013 1:38 pm
 
Forum: Investing - Theory, News & General
Topic: Gold
Replies: 78
Views: 4260

Re: 63yo moved 401k to 100% cash, how/when to restore AA?

A drop in the stock market isn't the only way the P/Es could be corrected. It could be that stocks will simply return 5% annually for the next ten years, still significantly higher than bonds but low enough that the P/Es will slowly drop. Exactly! And the market could also reach parity with long-te...
by shersch
Fri May 17, 2013 1:28 pm
 
Forum: Investing - Theory, News & General
Topic: 63yo moved 401k to 100% cash, how/when to restore AA?
Replies: 32
Views: 3582

Re: Total Bond or combination

If rates weren't at historic lows, I'd be inclined toward a combination of GNMA, High-Yield, and Total Bond. The former has exceptionally short duration for its yield, the latter is an unbeatable core, and the twain has a higher correlation to CPI than TIPS, which is under-discussed. These days, I'm...
by shersch
Fri May 17, 2013 1:21 pm
 
Forum: Investing - Theory, News & General
Topic: Total Bond or combination
Replies: 9
Views: 1057

Re: 63yo moved 401k to 100% cash, how/when to restore AA?

Fact is, none of us has a clue if/when a correction is coming, and to suggest otherwise is to badly distort Mr. Bogle's use of P/Es as a leading indicator of market trajectory. You can't time corrections. If he's not comfortable investing in equities with that cornerstone firmly in place, then he's ...
by shersch
Fri May 17, 2013 12:53 pm
 
Forum: Investing - Theory, News & General
Topic: 63yo moved 401k to 100% cash, how/when to restore AA?
Replies: 32
Views: 3582

Re: short term investment options question

In my opinion, do Option 1. Pay off your loans. Do not do Options 2 or 3. We're in a nice bull run now but that could change before you know it (I am not saying it will but you have to plan for the worst) and then you're in a pickle. Your time frame is too short to wait out a correction. Consider y...
by shersch
Fri May 17, 2013 12:45 pm
 
Forum: Investing - Help with Personal Investments
Topic: short term investment options question
Replies: 16
Views: 1222

Re: Help understanding fees, please

All that to say.....I understand that past performance is not an indicator of future results, so I can't rely on that. Is that what this all boils down to? Just to reinforce this, in a lot of ways past performance is often not even a true indicator of past performance. The problem is that poorly pe...
by shersch
Fri May 17, 2013 12:30 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help understanding fees, please
Replies: 13
Views: 865

Re: So how are bonds affected by taxable account

I can think of five pretty compelling reasons, but by far and away the biggest is the simplest: bond funds have higher turnover. Period. Always will. But the turnover in bond funds is almost irrelevant for tax purposes, because bond prices don't change much. If an intermediate-term bond fund buys a...
by shersch
Fri May 17, 2013 12:01 pm
 
Forum: Investing - Help with Personal Investments
Topic: So how are bonds affected by taxable account
Replies: 13
Views: 1218

Re: Help understanding fees, please

All that to say.....I understand that past performance is not an indicator of future results, so I can't rely on that. Is that what this all boils down to? Yes, that's exactly it. What if, ten years ago, the Vanguard fund had a previous 10 year run that was 3% better than the Oppen Fund? If you had...
by shersch
Fri May 17, 2013 11:41 am
 
Forum: Investing - Help with Personal Investments
Topic: Help understanding fees, please
Replies: 13
Views: 865

Re: Edward Jones to Vanguard?

I would also stop any new money from going into these accounts until you figure this out, especially your taxable account. I am also guessing that these are load funds meaning you are paying 5% of your money to the Edward Jones broker. For that reason, I would even stop investing in your retirement...
by shersch
Fri May 17, 2013 10:40 am
 
Forum: Investing - Help with Personal Investments
Topic: Edward Jones to Vanguard?
Replies: 22
Views: 2131

Re: Paralyzed by portfolio indecision

First, it's worth commending you for what you call paralysis or "indecision." In my view, the trouble with individual investors is pretty well the opposite: their finger is constantly on the trigger and they mistake frequent activity for financial prudence. Kudos. That said, I think you're...
by shersch
Thu May 16, 2013 7:52 pm
 
Forum: Investing - Help with Personal Investments
Topic: Paralyzed by portfolio indecision
Replies: 5
Views: 922

Re: 100% equities, anyone?

The real question is if your human capital is more bond like or more stock like. When I graduate I am going into corporate finance. My income will probably have an equity like component to it (especially as far as restricted stock bonuses is concerned), so I feel that my career will likely exhibit ...
by shersch
Thu May 16, 2013 7:06 pm
 
Forum: Investing - Theory, News & General
Topic: 100% equities, anyone?
Replies: 149
Views: 9882

Re: So how are bonds affected by taxable account

I can think of five pretty compelling reasons, but by far and away the biggest is the simplest: bond funds have higher turnover. Period. Always will.

This will become even more true if you tighten up your duration as rates rise.
by shersch
Thu May 16, 2013 7:00 pm
 
Forum: Investing - Help with Personal Investments
Topic: So how are bonds affected by taxable account
Replies: 13
Views: 1218

Re: VWELX vs Three fund portfolio?

I have been reading more on this topic for myself today and didn't realize the difference in paying taxes in an actively managed fund due to the selling of stocks throughout the year. I assume the index funds do not have this problem with stocks being sold throughout the year? Also, how heavy are b...
by shersch
Thu May 16, 2013 6:44 pm
 
Forum: Investing - Help with Personal Investments
Topic: VWELX vs Three fund portfolio?
Replies: 8
Views: 1433

Re: Calculating How Well/Poorly I've Done

I think there's a simpler way: pretend you are your own little mutual fund, and calculate it regularly as though you have a NAV. This will automatically take into account additions and withdrawals, and it's simpler than using Modified Dietz. Here's what you do: 1. Divide the total account into an ar...
by shersch
Thu May 16, 2013 5:47 pm
 
Forum: Investing - Help with Personal Investments
Topic: Calculating How Well/Poorly I've Done
Replies: 9
Views: 1096

Re: 100% equities, anyone?

100% equities Overweight US 26 years old It really has less to do with tactical responses to interest rates and more to do with my belief in Bernstein's life stages idea: I have so much more human capital than I do investment capital at this point in my life that I just don't see the point in having...
by shersch
Thu May 16, 2013 5:35 pm
 
Forum: Investing - Theory, News & General
Topic: 100% equities, anyone?
Replies: 149
Views: 9882

Re: College costs, anyone else spit coffee on their monitor?

There are myriad other ways to save money, too. Just a few ideas that added up for me during my first undergrad [admittedly some time ago]: 1. Make friends with the Freshmen -- they enjoy having the mentorship of an older upperclassman, and you'll enjoy "buddy passes" to the lunch halls on...
by shersch
Thu May 16, 2013 4:21 pm
 
Forum: Personal Finance (Not Investing)
Topic: College costs, anyone else spit coffee on their monitor?
Replies: 151
Views: 10353

Re: You probably know a person like this

OUCH!! That response says it all, doesn't it? As though to tell Rick Ferri: "C'mon Rick...I think I know a little something about finance. I mean, after all, you've written best-sellers on the subject and I've destroyed nearly half of my family's savings..."
by shersch
Thu May 16, 2013 4:11 pm
 
Forum: Investing - Theory, News & General
Topic: You probably know a person like this
Replies: 22
Views: 3228

Re: VWELX vs Three fund portfolio?

Yes, Wellington is actively managed, and while turnover isn't sky high [~31%], it's certainly high enough to give me heartburn knowing it's going into a taxable account. With the ETFs, you have at least two distinct advantages: 1. The ability to take capital losses and not just capital gains [you on...
by shersch
Thu May 16, 2013 3:48 pm
 
Forum: Investing - Help with Personal Investments
Topic: VWELX vs Three fund portfolio?
Replies: 8
Views: 1433

Re: disregarding ''daily noise"

I remind myself that news anchors are ordinary, and ordinary is usually synonymous with poor. I don't adopt the financial worldview of the self-inflicted poor. Just saying...
by shersch
Thu May 16, 2013 3:44 pm
 
Forum: Investing - Theory, News & General
Topic: disregarding ''daily noise"
Replies: 34
Views: 2102

Re: Help understanding fees, please

Tractor's response pretty much captures what you need to know. Nothing flawed about your analysis, only that you won't be able to know which one will outperform in the future. Something else to keep in mind: all properly-constructed, broad market indices should perform comparably on a risk-adjusted ...
by shersch
Thu May 16, 2013 3:39 pm
 
Forum: Investing - Help with Personal Investments
Topic: Help understanding fees, please
Replies: 13
Views: 865

Re: Fund Advice from Advisor - S&P500 Performance

One of my favorite broker tricks! It's hindsight bias at its best. Something I like to do, also with Morningstar, is check the Fund Family [you'll see a little FF in red in the upper left of any mutual fund you look up]. Then plug in a Vanguard fund and do the same thing. This way, you're not cherry...
by shersch
Thu May 16, 2013 3:33 pm
 
Forum: Investing - Help with Personal Investments
Topic: Fund Advice from Advisor - S&P500 Performance
Replies: 42
Views: 1977

RAFI Revisited -- Bond Funds

Rob Arnott admits readily that inefficient short-term pricing is a major driver of the RAFI value-add [assuming there is one]. So if not the fact of outperformance, then at least the degree of outperformance seems to hinge on the degree of inefficiency in the asset class, which presumably is why the...
by shersch
Thu May 16, 2013 3:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: RAFI Revisited -- Bond Funds
Replies: 0
Views: 193

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