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Re: Small cap value premium

Anyone else tired of small cap value premium discussions?


Sorry, I tried my best to end them: viewtopic.php?f=10&t=96441

:happy
by stlutz
Thu Nov 20, 2014 12:17 am
 
Forum: Investing - Theory, News & General
Topic: Small cap value premium
Replies: 41
Views: 2866

Re: Vacation in France

By all means spend a few days in Paris, but definitely spend more time in less urban areas. Aside from being a better way to spend time with your GF, outside of Paris the French people are wonderful. And, as others have noted, you don't *have* to spend $10K to travel in Europe (and you can still do ...
by stlutz
Wed Nov 19, 2014 1:20 am
 
Forum: Personal Consumer Issues
Topic: Vacation in France
Replies: 65
Views: 3095

Re: Quit Cobra to go on Obamacare?

With most people in your situation (i.e. no children), health care is used very little most of the time then gets used all in one big bunch because something bad happens. When it does, what do you care about? For me, I care about what doctors I can see *in-network* (out of network care is generally ...
by stlutz
Tue Nov 18, 2014 10:23 pm
 
Forum: Personal Finance (Not Investing)
Topic: Quit Cobra to go on Obamacare?
Replies: 22
Views: 2336

Re: Glidepath (target date) investments distort asset alloca

There are different types of savings. When people, be they young or old, raid their retirement accounts when they lose their jobs, the issue isn't the allocation of the retirement account, it's that they have inadequate other savings. We save for a lot of different things in our lives. There is reti...
by stlutz
Tue Nov 18, 2014 10:10 pm
 
Forum: Investing - Theory, News & General
Topic: Glidepath (target date) investments distort asset allocation
Replies: 20
Views: 2597

Re: Personal $$ Review - a product of Trev H and Livesoft

A few thoughts: --I agree with the prior poster that you should have more bonds. However, if you do want to keep a low bond allocation (e.g. under 25%), I would use Treasury bonds--VG Intermeidate Term Government bond is a great choice or if you do ETFs SCHR is another great option. Treasury bonds h...
by stlutz
Tue Nov 18, 2014 12:09 am
 
Forum: Investing - Help with Personal Investments
Topic: Personal $$ Review - a product of Trev H and Livesoft
Replies: 8
Views: 1239

Re: Fidelity 2-Factor authentication fail...

I'm curious what people *want* Fidelity to do in this case?

10 or 12 years ago I had lost my VG password and had to wait for them to snail me a new one. That is one approach.
by stlutz
Fri Nov 14, 2014 9:14 pm
 
Forum: Personal Consumer Issues
Topic: Fidelity 2-Factor authentication fail...
Replies: 13
Views: 1093

Re: The Sell in May and go away myth, why does it persist

There actually was a paper on this subject a couple of years back. Just Google, "Sell in May and go away just won't go away."
by stlutz
Sat Nov 08, 2014 12:05 am
 
Forum: Investing - Theory, News & General
Topic: The Sell in May and go away myth, why does it persist
Replies: 15
Views: 2179

Re: ETF premium/discount

Are the prices we see based mostly on after-hours trading for those international markets? I'm curious how that is determined exactly. The NAV reported during US market hours will be the close price in the local market adjusted for any currency rate changes that occurred since then. For further dis...
by stlutz
Sat Nov 01, 2014 11:32 am
 
Forum: Investing - Theory, News & General
Topic: ETF premium/discount
Replies: 7
Views: 779

Re: “Risk and Return Within the Stock Market: What Works Bes

Here's my take, there is really no low vol phenomenon. But having looked extensively at the low vol I'm very skeptical, again mostly it's high vol that is bad, not low vol that is good. It gets about same returns as the other quintiles except the highest. The "low vol phenomenon" is that ...
by stlutz
Sat Nov 01, 2014 12:26 am
 
Forum: Investing - Theory, News & General
Topic: “Risk and Return Within the Stock Market: What Works Best?”
Replies: 30
Views: 3973

Re: Portfolio Analysis - What to do in 2015?

The extra funds you are adding are not adding any diversification. The S&P 500 is about 80% of the Total Stock Market. TSM is a 63% of the Target Retirement 2050 fund. The TR 2050 fund basically owns every stock and investment grade bond issued worldwide. You don't get more diversified than that...
by stlutz
Fri Oct 31, 2014 11:59 pm
 
Forum: Investing - Help with Personal Investments
Topic: Portfolio Analysis - What to do in 2015?
Replies: 7
Views: 1556

Re: Anyone consider retiring to Vancouver, Washington?

If I was going to live in that area I would pick Portland over Vancouver simply because I don't want to get out of the car and pump my own gas when it's raining out. :D
by stlutz
Fri Oct 31, 2014 10:24 pm
 
Forum: Personal Consumer Issues
Topic: Anyone consider retiring to Vancouver, Washington?
Replies: 45
Views: 4424

Re: Considering short-term, investment-grade bonds for Roth

Since you have an equity-heavy allocation, the question should be selecting which bonds work best with that type of portfolio. That is, you want bonds that are more likely to go up when equities go down. Treasuries are the bonds that are mostly likely to do this. Compare the 2008 performance of the ...
by stlutz
Fri Oct 31, 2014 10:13 pm
 
Forum: Investing - Help with Personal Investments
Topic: Considering short-term, investment-grade bonds for Roth IRA
Replies: 20
Views: 942

Re: ETF premium/discount

Negative means it's selling at a discount.

One thing to keep in mind is that, depending upon the ETF, the NAV is somewhat of an estimate. This is true with non-Treasury bond ETFs as well as international ETFs anytime after early morning hours when most international markets are closed.
by stlutz
Fri Oct 31, 2014 9:33 pm
 
Forum: Investing - Theory, News & General
Topic: ETF premium/discount
Replies: 7
Views: 779

Re: Schwab expands no commission ETFs-no early sell fee

Okay--to explain my "second class" comment. I was basing it on the following: 1) Expense ratios. I personally have a policy against paying more than .2% for any ETF. So, that wipes out most of the non-Schwab options at Schwab. 2) Trading costs. SLYV was mentioned as a good option. However,...
by stlutz
Fri Oct 31, 2014 6:06 pm
 
Forum: Investing - Theory, News & General
Topic: Schwab expands no commission ETFs-no early sell fee
Replies: 42
Views: 3196

Re: Schwab expands no commission ETFs-no early sell fee

Schwab's own ETFs are great funds and in some cases are the best option in their class. The other ETF one-source funds are completely underwhelming. It's basically made up of a bunch of higher-cost funds that have struggled to acquire assets. The supermarket lets Schwab complete with TD, Vanguard an...
by stlutz
Fri Oct 31, 2014 12:33 am
 
Forum: Investing - Theory, News & General
Topic: Schwab expands no commission ETFs-no early sell fee
Replies: 42
Views: 3196

Re: ITOT vs. VTI

These pages provide a good comparison between the two: http://www.etf.com/ITOT http://www.etf.com/VTI ITOT is the weakest offering in the iShares Core lineup, IMO. I would expect a "total market" fund to own thousands of stocks, not just 1500. ITOT covers about 90% of the US market; VTI co...
by stlutz
Sun Oct 26, 2014 9:58 am
 
Forum: Investing - Help with Personal Investments
Topic: ITOT vs. VTI [iShares Total US Stock ETF vs. Vanguard]
Replies: 14
Views: 940

Re: A fund "adviser's" financial strength: important?

I suppose we've seen recently what a run on a bond fund in an orderly market looks like with PIMCO. In 2009 we saw liquidity in the TIPS market dry up. There were no mass redemptions of TIPS funds, so we just saw that a disorderly market didn't lead to panic selling. Those give us concrete examples ...
by stlutz
Sat Oct 25, 2014 9:39 pm
 
Forum: Investing - Theory, News & General
Topic: A fund "adviser's" financial strength: important?
Replies: 6
Views: 756

Re: Barrons article...Charles Schwab company

Couple of interesting things I noticed: Within the next few weeks, Bettinger says Schwab will offer a Web-based advice platform for the general investing public, followed by a version for its independent investment advisors. This robo-investing product will design custom portfolios based on what wil...
by stlutz
Sat Oct 25, 2014 9:20 pm
 
Forum: Investing - Theory, News & General
Topic: Barron's on Schwab [CEO prefers Indexing for 401ks]
Replies: 16
Views: 2214

Re: front-running, MSCI USA vs Total market fund

There is very little indexed to the MSCI USA index so I would not worry about front running there.

That said, I'd generally prefer the total market fund assuming equivalent expenses.
by stlutz
Fri Oct 24, 2014 10:08 pm
 
Forum: Investing - Help with Personal Investments
Topic: front-running, MSCI USA vs Total market fund
Replies: 1
Views: 411

Re: Best health insurance plan for a bad year (cancer)?

Welcome to the forum--sorry your first post couldn't be about happier things. It sounds like she is basically guaranteed to hit her out of pocket maximum next year. As such, plan 2 makes more sense since it has a substantially lower OOP maximum. And, as you note, having out-of-network coverage is al...
by stlutz
Fri Oct 24, 2014 10:01 pm
 
Forum: Personal Finance (Not Investing)
Topic: Best health insurance plan for a bad year (cancer)?
Replies: 30
Views: 2348

Re: TSA [is it a hassle to opt out of scanning?]

Just go through the scanner. As was noted above, they don't use the X-ray machines anymore.
by stlutz
Wed Oct 22, 2014 10:38 pm
 
Forum: Personal Consumer Issues
Topic: TSA [is it a hassle to opt out of scanning?]
Replies: 42
Views: 2243

Re: Three Possible Outcomes for Future Investment Returns

The 1980s were in many ways perfect for bond investors--prices had the possibility of high inflation built in while actual inflation was much lower. Treating this perfect world as being a key part of the mean is not what I would do. Real rates a probably lower than what the future mean will be, but ...
by stlutz
Wed Oct 22, 2014 8:57 pm
 
Forum: Investing - Theory, News & General
Topic: Three Possible Outcomes for Future Investment Returns
Replies: 32
Views: 2354

Re: Importing yields from treasury.gov into Google spreadshe

I haven't use google spreadsheets before. But, for this data I've always just used copy and paste from the website (e.g. http://www.treasury.gov/resource-center ... &year=2013) into a LibreOffice spreadsheet
by stlutz
Wed Oct 22, 2014 8:47 pm
 
Forum: Investing - Theory, News & General
Topic: Importing yields from treasury.gov into Google spreadsheet
Replies: 18
Views: 1542

Re: So do we care more about change in bond price or bond yi

Given two bonds with the same maturity date, the one with the higher coupon will have a lower duration. So, the bumps probably indicate that that bonds trade more on the basis of duration than maturity.
by stlutz
Wed Oct 22, 2014 8:29 pm
 
Forum: Investing - Theory, News & General
Topic: So do we care more about change in bond price or bond yield?
Replies: 178
Views: 14129

Re: Why is VIPSX (TIPS) active?

Individual TIPS can only be sold in large quantities At Vanguard and Fidelity, they can be bought and sold in 1 bond ($1000) increments. Spreads are generally around 40 to 50 cents (i.e. <.50%). LTPZ holds a grand total of 6 bonds, so there isn't a whole lot of "management" going on for t...
by stlutz
Tue Oct 21, 2014 11:19 pm
 
Forum: Investing - Theory, News & General
Topic: Why is VIPSX (TIPS) active?
Replies: 18
Views: 1738

Re: IBM: Stock Buybacks Gone Wrong?

Remember that a buyback is just another way to pay a dividend.

Why do you think that IBM management would have made better investments with those profits than their shareholders would have? At the end of the day I trust investors to allocate capital more than I trust managers to.
by stlutz
Tue Oct 21, 2014 8:26 pm
 
Forum: Investing - Theory, News & General
Topic: IBM: Stock Buybacks Gone Wrong?
Replies: 65
Views: 4132

Re: Why do Engineers Think They’ll Be Good at Picking Stocks

Based upon the small sample size of people I know, I would change Victoria's assumption a little bit and focus more on retired engineers. While they are working, they have an outlet for their approaches from 8 to 5. It's when they retire that they then turn their focus to stock picture, trading comm...
by stlutz
Tue Oct 21, 2014 8:21 pm
 
Forum: Investing - Theory, News & General
Topic: Why do Engineers Think They’ll Be Good at Picking Stocks?
Replies: 135
Views: 10616

Re: Health care tilt

Just to be contrarian, one could argue that investing in the healthcare sector is actually a great hedge to the risks of working in it. In any business, the rewards can go to capital or they can go to labor. If doctors get replaced by robots, who wins big? Healthcare companies. On the other hand, if...
by stlutz
Tue Oct 21, 2014 8:15 pm
 
Forum: Investing - Theory, News & General
Topic: Health care tilt
Replies: 77
Views: 4002

Re: So do we care more about change in bond price or bond yi

Got it--I see what you're doing now. I've never actually messed much with zero-coupon bonds before. I think that return "hump" around year 6 may disappear if you use the zero-coupon yield curve as opposed to the "regular bond" yield curve. A regular 10 year bond yields 2.2% but a...
by stlutz
Tue Oct 21, 2014 12:25 am
 
Forum: Investing - Theory, News & General
Topic: So do we care more about change in bond price or bond yield?
Replies: 178
Views: 14129

Re: Individual Bonds versus Bond Funds - Again

I like the in-the-weeds discussions on this, but at the end of the day it's really a simple as remembering that a bond fund holds individual bonds. If I have portfolio of 50 individual bonds and ogd has a fund with the exact same 50 bonds, they will behave the same. The liquidity risks are slightly ...
by stlutz
Mon Oct 20, 2014 7:54 pm
 
Forum: Investing - Theory, News & General
Topic: Individual Bonds versus Bond Funds - Again
Replies: 17
Views: 1259

Re: So do we care more about change in bond price or bond yi

Hi Kevin, Thanks for the post. I don't think I agree with your inputs into the PRICE function. When calculating the price gain from holding the bond, I think you need to use a settlement date one year in the future (i.e. 10/20/15) as that is what the price one-year from now would be based on. So, lo...
by stlutz
Mon Oct 20, 2014 7:43 pm
 
Forum: Investing - Theory, News & General
Topic: So do we care more about change in bond price or bond yield?
Replies: 178
Views: 14129

The Final, Definitive Thread on Rebalancing

With the market volatility of late, there have been a ton of threads about rebalancing. As a service to the Bogleheads community, I occasionally provide what I'm sure all agree are helpful and dare I say it, definitive, threads that consolidate all of the discussions into a single place so new peopl...
by stlutz
Sat Oct 18, 2014 8:04 pm
 
Forum: Investing - Theory, News & General
Topic: The Final, Definitive Thread on Rebalancing
Replies: 24
Views: 2050

Re: What tax software do you use and why

I use free fillable forms. Two reasons: a) I just have a problem paying someone to help me pay money to someone. b) I always worry about skipping things I should report (or can deduct). As such, I prefer to sit down and just read through the rules each time. At the end of the day it only take a few ...
by stlutz
Sat Oct 18, 2014 5:23 pm
 
Forum: Personal Finance (Not Investing)
Topic: What tax software do you use and why
Replies: 54
Views: 2637

Re: inefficiencies in small lot, near-term muni bonds prices

Thoughts? Since I don't always say this, I agree 100% with Larry. :sharebeer You can search some other threads about buying individual munis. There are plenty of posts that say that individuals should never ever buy an individual bond, but a there are also more complete discussions of the positives...
by stlutz
Sat Oct 18, 2014 5:05 pm
 
Forum: Investing - Theory, News & General
Topic: inefficiencies in small lot, near-term muni bonds prices?
Replies: 8
Views: 772

Re: How does Vanguard shield ETF shareholders from turnover

Anyway, if you're worried about this the simple test is to check the tracking error of the VG ETF you're considering vs the alternatives. +1. A good example to look at is corporate bond ETFs. VCIT has underperformed its benchmark by 10 basis points since inception, a little less than its ER. Compar...
by stlutz
Sat Oct 18, 2014 5:00 pm
 
Forum: Investing - Theory, News & General
Topic: How does Vanguard shield ETF shareholders from turnover cost
Replies: 20
Views: 1506

Re: How does Vanguard shield ETF shareholders from turnover

It doesn't cost other customers or investors money because Vanguard brokerage service is not part of the ETF or mutual fund. If they waste their time processing too many free trades for their ETFs, that doesn't reduce the NAV of any of the Vnaguard products. They might start to charge higher commis...
by stlutz
Sat Oct 18, 2014 4:56 pm
 
Forum: Investing - Theory, News & General
Topic: How does Vanguard shield ETF shareholders from turnover cost
Replies: 20
Views: 1506

Re: "I've had it" at work - how often

I guess the key must be to avoid moving into management, the mistake I made 15 long years ago For people who were in management and moved out of it, did you do it with the same employer or did you move to another company I moved into a management role a year or so ago and would like to move out. I ...
by stlutz
Sat Oct 18, 2014 4:47 pm
 
Forum: Personal Finance (Not Investing)
Topic: "I've had it" at work - how often
Replies: 151
Views: 12616

Re: How does Vanguard shield ETF shareholders from turnover

how does Vanguard protect the ETF shareholders from this issue? The bottom line answer is that in most cases they don't take any special action. The more important question, however, is whether it matters. VTI (the ETF class of VG total market) has trailed its index by .02% per year since the incep...
by stlutz
Fri Oct 17, 2014 10:55 pm
 
Forum: Investing - Theory, News & General
Topic: How does Vanguard shield ETF shareholders from turnover cost
Replies: 20
Views: 1506

Re: How will we know if value-tilting has stopped working?

Finally, for what it is worth, value stocks have been more volatile no matter what time frame you look at LOL Larry! You're just demonstrating the point the point I made earlier which you dismissed--more concentrated portfolios are more volatile than less concentrated ones. Let's look at the standa...
by stlutz
Thu Oct 16, 2014 10:56 pm
 
Forum: Investing - Theory, News & General
Topic: How will we know if value-tilting has stopped working?
Replies: 44
Views: 3137

Re: So do we care more about change in bond price or bond yi

There is nothing inheritance better or worse for a fund selling before maturity. It is just another way of increasing the duration of the fund. If you want to have two five year funds (my Fund 0-5 and Fund 1-5) to have the same maturity the Fund 0-5 would have to become a Fund 0-6. An active fund m...
by stlutz
Thu Oct 16, 2014 9:42 pm
 
Forum: Investing - Theory, News & General
Topic: So do we care more about change in bond price or bond yield?
Replies: 178
Views: 14129

Re: How will we know if value-tilting has stopped working?

Is it any more valid than looking at data from 1937, or from 1960, when there have been intervening, mitigating, unplanned factors? There will always be mitigating factors. Stlutz mentioned the creation of the SEC in 1937, for just one example. You can look at those as noise, or as unplanned events...
by stlutz
Thu Oct 16, 2014 9:25 pm
 
Forum: Investing - Theory, News & General
Topic: How will we know if value-tilting has stopped working?
Replies: 44
Views: 3137

Re: "The best response to market volatility"

A while back I looked at the tax-loss harvesting moves I've made and the replacement funds I chose always ended up underperforming what I sold to get the tax loss. Personal experience that demonstrates to me at least the best advice is more often than not to do nothing.
by stlutz
Thu Oct 16, 2014 8:42 pm
 
Forum: Investing - Theory, News & General
Topic: "The best response to market volatility"
Replies: 27
Views: 3376

Re: Does "substantially identical" apply to combined securit

I would read that paper I linked to up toward the top on bonds. I think it may provide some helpful guidance. For example, selling a bond with 1 year of maturity left and replacing with one with 2 years is okay; replacing a 25 year bond with a 26 year bond (from the same issuer) is not because they ...
by stlutz
Thu Oct 16, 2014 8:37 pm
 
Forum: Investing - Help with Personal Investments
Topic: Does "substantially identical" apply to combined securities?
Replies: 31
Views: 1514

Re: How to write an effective complaint letter

BTW, have you contacted a repair shop to ask what they would charge to replace it?
by stlutz
Thu Oct 16, 2014 8:27 pm
 
Forum: Personal Consumer Issues
Topic: How to write an effective complaint letter
Replies: 27
Views: 1446

Re: How to write an effective complaint letter

For me the key has always been to a) ask for something specific; and b) be reasonable. In this case it might be asking for 1/2. I'm seeing a battery listed on Amazon right now for $73. I had (well still have, actually) a Dell Laptop that had a similar ridiculous procedure to replace a hard drive. Wh...
by stlutz
Thu Oct 16, 2014 8:26 pm
 
Forum: Personal Consumer Issues
Topic: How to write an effective complaint letter
Replies: 27
Views: 1446

Re: How will we know if value-tilting has stopped working?

First re volatility of returns. There is clearly evidence that value stocks are more volatile. 1927-2013 LG had SD of 18.7 and LV of 26.2, that's not only higher SD but 40% higher SD Couple of notes: First, F/F define their populations in a somewhat quirky way that is very unlike the way it is done...
by stlutz
Wed Oct 15, 2014 9:40 pm
 
Forum: Investing - Theory, News & General
Topic: How will we know if value-tilting has stopped working?
Replies: 44
Views: 3137

Re: "Smart" Beta - general consensus?

Here a writeup from the firm that coined the name: http://www.towerswatson.com/DownloadMedia.aspx?media={CEAA2C30-486C-4E14-A486-8FECC97C56AD} Smart beta is simply about trying to identify good investment ideas that can be structured better, whether that is improving existing beta opportunities or c...
by stlutz
Wed Oct 15, 2014 9:05 pm
 
Forum: Investing - Theory, News & General
Topic: "Smart" Beta - general consensus?
Replies: 17
Views: 1455

Re: Does "substantially identical" apply to combined securit

Does anybody have links to relevant tax court rulings. From some Googling, this was the one useful paper I could find focused on fixed income: http://g2ft.com/papers/G2FTAdvancedTopicsinWashSales_SubstantiallyIdenticalBonds.pdf From what I gather, there simply aren't any rulings when it comes to sel...
by stlutz
Tue Oct 14, 2014 9:05 pm
 
Forum: Investing - Help with Personal Investments
Topic: Does "substantially identical" apply to combined securities?
Replies: 31
Views: 1514

Re: How will we know if value-tilting has stopped working?

In the part of one's investing lifetime where this question matters, the answer is that you won't know. If you are going to value tilt, you should go into it at the outset knowing that there is a very good chance that it will not work. That is the risk of making bets on particular corners of the mar...
by stlutz
Tue Oct 14, 2014 8:14 pm
 
Forum: Investing - Theory, News & General
Topic: How will we know if value-tilting has stopped working?
Replies: 44
Views: 3137
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