Search found 1442 matches

by Karamatsu
Mon Sep 09, 2019 8:43 pm
Forum: Investing - Theory, News & General
Topic: Rich people are hoarding cash
Replies: 233
Views: 38890

Re: Rich people are hoarding cash

I think the article is just noise. With the curve inverted and the 90-day T-bill (typically considered a cash-equivalent) yielding 1.96% that's not bad return at all.
by Karamatsu
Mon Aug 26, 2019 5:32 pm
Forum: Investing - Theory, News & General
Topic: Volatile stocks for fun: Limit Order or Stop Limit Order for maximum profit
Replies: 25
Views: 1695

Re: Volatile stocks for fun: Limit Order or Stop Limit Order for maximum profit

On looking back, I feel I should have used stop-loss orders. Well, I think of it in two ways. One is that if this is for education/fun, then maybe what you could do is take your position in the volatile company (or any of them) and split that. Place a sell-limit order on one half and a stop-loss order on the other half, then see what you get. The other, more general way of thinking about it is that there simply is no consistently winning strategy. All these order types are just shiny objects that distract us with illusions of strategic control. If there were a consistently winning way to place your orders, then those in the finance industry who knew about it would keep it a secret and never, ever offer it to retail investors. They'd start ...
by Karamatsu
Sat Aug 17, 2019 3:30 am
Forum: Investing - Theory, News & General
Topic: A short study of the recent Japanese crisis
Replies: 70
Views: 10750

Re: A short study of the recent Japanese crisis

My impression from having many Japanese friends is that "a Japanese passive investor" has never invested that much in the stock market. They are simply less concerned about what happened to the Japanese stock market than Americans are concerned about the Japanese stock market. I think that part is quite accurate. Japanese tend to have a very dim view of the stock market, seeing it as (a) rigged against small investors, and (b) little more than a place for gamblers. There is truth to both of those assertions, though from different angles, but from the perspective of the ordinary Japanese person, the implosion of the stock market was irrelevant: like a casino in Las Vegas going bust. Who cares? And at first there was very little re...
by Karamatsu
Fri Aug 16, 2019 8:11 am
Forum: Investing - Theory, News & General
Topic: A short study of the recent Japanese crisis
Replies: 70
Views: 10750

Re: A short study of the recent Japanese crisis

I have been reading increasingly of fears that the global economy is looking like the Japan economy did pre-crisis (such fears may be overblown but they do raise an interesting question) Are you concerned about the economy or the financial markets? As far as the markets go, it was pretty much a straightforward asset bubble, enabled by certain finance/accounting rules combined with the way the banking sector was organized, so that could (and of course, has) happen anywhere. The economy -- in particular the failure of Japan's governing elites to act in response to the bursting of the bubble, leading to the decades of relative stagnation/stability -- is a rather unique political/social catastrophe that arises from Japan's history, culture, po...
by Karamatsu
Sun Aug 04, 2019 8:26 pm
Forum: Investing - Theory, News & General
Topic: Schwab's Securities Lending Fully Paid (SLFP) program
Replies: 26
Views: 12601

Re: Schwab's Securities Lending Fully Paid (SLFP) program

Schwab just sent me an offer of a 73% interest rate on loan of 100 shares of stock
I think I would contact Schwab immediately, by phone (and be sure to look up the number rather than rely on anything in the offer) and make sure this is legitimate. 73%? For 100 shares? If I got something like that, with correct identification of shares that I held, I would suspect a hack of some kind. It's too good to be true. But of course, that said, I hope it is, because it would be amazing.
by Karamatsu
Wed May 29, 2019 1:14 am
Forum: Investing - Theory, News & General
Topic: How can I check my portfolio as little as possible?
Replies: 69
Views: 4507

Re: How can I check my portfolio as little as possible?

Thank you so much for your ideas to help me stick with my inadvisably-risky portfolio for 15 years! I suppose I would just not look. Set up automatic contributions, or whatever it takes to keep new money flowing into your portfolio, reinvest all dividends, and then get involved in non-financial things. Live your life. In truth you won't be able to completely ignore your portfolio because you will need to include 1099 data on your tax returns each year, but beyond that, as long as you have a small number of large, broad-based index funds and don't care about voting your shares, you probably could (more or less) just go away for 15 years, except for unusual events like a fund restructuring, etc, that may require some paperwork. Otherwise, if...
by Karamatsu
Wed May 29, 2019 12:40 am
Forum: Investing - Theory, News & General
Topic: Closed End Funds
Replies: 15
Views: 4081

Re: Closed End Funds

I used to speculate in CEFs. They were a wild ride in 2008-2009, and when leverage funding dried up it looked like many of them would go under, but banks were willing to lend to them and none of the ones I held actually folded, which is more than I can say for some preferred stocks. But CEF structure is used as a wrapper for all kinds of things, including some pretty bizarre speculative strategies, and the ER is often higher -- sometimes a lot higher -- than you'd expect from the index fund world. I think you have to love finance and reading financial documents to have a clue about what you're doing, manage the risks, and avoid getting taken in. Always remember that the managers are in this for their own benefit, not yours. PS Just to add, ...
by Karamatsu
Tue May 28, 2019 11:08 pm
Forum: Investing - Theory, News & General
Topic: Do you have an allocation more conservative than 50/50 ?? What is it? Why? How Bogleheads are getting it done.
Replies: 166
Views: 24224

Re: Do you have an allocation more conservative than 50/50 ?? What is it? Why?

Does anyone here have an allocation that is more conservative than 50/50? My allocation has been 35/65 for a long time. It's based mostly on my own assessment of my risk tolerance and the impact that a significant drop in equity prices would have on future financial plans. Following a discussion here some years back, I asked myself how much I could lose and still sleep at night. Based on 30+ years of investing, it turned out to be 15-20%, so... if you figure a 50% drop is within the realm of possibility, 35% in equities splits the difference. Once I reach 65 I'll probably start ramping down the equity to match "age in bonds," but it depends a little on the tax consequences. Inflation-indexed bonds and Japan's national medical ins...
by Karamatsu
Tue May 14, 2019 6:59 pm
Forum: Investing - Theory, News & General
Topic: Do posters/the press underestimate changes to the structure of markets?
Replies: 9
Views: 1242

Re: Do posters/the press underestimate changes to the structure of markets?

Why are posters and articles not discussing these more, in your opinion? There are big differences among posters here, of course, with different levels of knowledge and expertise, but when you get right down to it, the only data we have on which to base our decisions are the data that we have. Perhaps the implicit assertion is that, while changes in market structure from country to country, or within the same market from time period to time period (or even within one market at different times of a single day) are real, these differences wash out in the end, leaving us with roughly applicable rules of thumb about human nature and the human activity of "trading" that can keep us on a path that has a better chance of a positive outc...
by Karamatsu
Sun Dec 09, 2018 6:58 am
Forum: Investing - Theory, News & General
Topic: Is a company's stock buyback optional or mandatory for individual shareholders?
Replies: 7
Views: 1028

Re: Is a company's stock buyback optional or mandatory for individual shareholders?

I've seem similar things during takeover bids in Japan, where the new buyers will make an offer, the board will recommend that shareholders accept it, the major shareholders sell, but...... some small shareholders, for whatever reason, do not. I've always suspected that they just ignored the shareholder letter (how many people ever really read those?). But it turns out, in Japan, they can't be forced to sell, so the buyers end up asking politely, several times, maybe even going to meet the shareholders in person if it's practical. In the end, though, once the new owners have a controlling interest, they may be able to do nasty things to dilute the value of your shares, so... probably better to go along with it. That said, what people are us...
by Karamatsu
Sun Dec 02, 2018 5:57 pm
Forum: Investing - Theory, News & General
Topic: Bond Sell and Buy Decisions - Math answers
Replies: 8
Views: 1352

Re: Bond Sell and Buy Decisions - Math answers

For example, I have a bond bought for $996.875 with a buy yield of 2.080%. I asked a Vg fixed income person if there is a standard or usual name for the product of these two numbers, i.e. 2.080% x $996.875 = $20.735. He said that there is no standard name for this number, the $20.735. I kind of see what you're getting at. Maybe you could call something like that the "purchase yield," but I'm not sure how useful it would be. The standard way to figure in discounts/premiums in the purchase price is to compute the yield to maturity, which most brokers and/or spreadsheet programs will do for you, and it's a good way to compare two treasury offerings (all else equal). Otherwise, once you buy a bond, then except for tax implications if...
by Karamatsu
Mon Nov 26, 2018 2:22 am
Forum: Personal Investments
Topic: Am I too risk averse?
Replies: 56
Views: 6377

Re: Am I too risk averse?

As a counterpoint, I wouldn't say you're too risk-averse at all. Unless you enjoy swimming with sharks or jumping out of airplanes for their own sake, it's silly to take more risk than you must. So if you don't have to, feel good about that and enjoy the other aspects of your life. The only thing I would suggest is to shift your bond/CD allocation so that you have maybe 50% in TIPS (or a TIPS fund might be better because of the way individual TIPS issues are treated in a taxable account) rather than keeping so much in nominal issues, since inflation is an important long-term risk factor for a portfolio that emphasizes fixed-income.

FWIW I'm at 35% equities, so... not very different.
by Karamatsu
Fri Nov 09, 2018 2:21 am
Forum: Investing - Theory, News & General
Topic: Do you prefer etfs or mutual funds?
Replies: 271
Views: 18926

Re: Do you prefer etfs or mutual funds?

I don't have a choice because of residency rules, but if I could use either one, I'd compare the costs. I'm not sure about now, but for a while, at least, Vanguard's mutual funds had higher fees than the ETF share class of exactly the same fund. The ETF might trade at a premium or a discount to the NAV, so you'd have to take that into account, but if you're buying and holding, that's a one-time cost compared to higher fees deducted annually. At some point the expenses would offset the ETF trading spread, though you'd have to calculate where that breakeven point is. As it is, I use ETFs for everything and the only problem is that I have to choose my buy/sell prices rather than just taking the NAV at the end of any given day. But I only buy/s...
by Karamatsu
Sat Aug 25, 2018 6:17 am
Forum: Non-US Investing
Topic: Mistake done [Europe - Have you ever regretted a trade that you made?]
Replies: 13
Views: 1888

Re: Mistake done [Europe - Have you ever regretted a trade that you made?]

I know this loss is not the end of the world, especially with a buy and hold strategy but I would like to hear your comments if you have ever made such a mistake in a day and how you react about it. Sure, I've made mistakes like that lots of times, as well as typographical errors, errors in judgment, errors from lack of knowledge, etc, etc. Sometimes you can learn the lesson and move on. Other times, as with what seems to have happened to you, there really isn't anything you can learn except that, "Unexpected things sometimes happen," so the takeaways seem to be diverse holdings, bonds as well as equities, low costs, really, really mind your risk tolerance, ignore short-term fluctuations, have a reasonable, sustainable plan, and ...
by Karamatsu
Mon Jun 25, 2018 8:46 am
Forum: Non-US Investing
Topic: Starting out, in Japan
Replies: 34
Views: 5809

Re: Starting out, in Japan

Thanks for that link to the Vanguard funds. I had not seen them before, but at first glance they look good. What do people think about the .1696% ER? It's a little over 4X what the actual Vanguard fund costs, but maybe still reasonable for Japan. I'm not sure... but if so, it would be tempting just because it's Vanguard.
by Karamatsu
Mon Jun 25, 2018 8:36 am
Forum: Non-US Investing
Topic: Starting out, in Japan
Replies: 34
Views: 5809

Re: Starting out, in Japan

For example, it is perfectly reasonable (and this is exactly how infants learn Japanese and any language) to learn Japanese sentences and grammar without learning any grammar. Just keep in mind that in order for that to work it can't just be passive. There needs to be constant positive feedback and modeling of grammatically correct sentences by parents and others. Also children have a degree of linguistic plasticity that is kind of unusual in adults... beyond a certain point, the grammatical constructs of the languages you use (which do have grammar rules, even if you aren't conscious of them!) become sort of "burned in," and it's harder to accommodate new ones. Same deal with pronunciation. It can all be done, most certainly, bu...
by Karamatsu
Sun Jun 24, 2018 3:28 am
Forum: Non-US Investing
Topic: Starting out, in Japan
Replies: 34
Views: 5809

Re: Starting out, in Japan

The main difficulties with investing in US assets in the short term come from the brokers. Many US brokers don't want to deal with expatriates, so you'd want to check with your broker(s) and make sure they are OK with you continuing to invest while in Japan. Be sure to phrase it as a hypothetical so they don't think you're already in Japan! Otherwise there are just a bunch of tax issues: discrimination from both the IRS and the Japanese Tax Agency, that you need to be aware of to make smart choices, but the Japanese rules, especially, change every year so there's only so much you can anticipate. I'm not sure why you'd want to get permanent residency if you're thinking of leaving after 3-7 years, but I guess it depends on your initial visa s...
by Karamatsu
Wed Jun 06, 2018 9:25 pm
Forum: Non-US Investing
Topic: Starting out, in Japan
Replies: 34
Views: 5809

Re: Starting out, in Japan

ようこそ! Since our situations are a bit different (I'm a US citizen) a lot of the craziness won't apply, so it just comes down to the choices that work best for you. I would, however, recommend something less aggressive than 100% stocks. I know all the arguments (been there, done that), but would seriously consider age-in-bonds as a more stable alternative. That's particularly so for someone just starting out during what has been more or less a bull market, where all you had to do was wait a bit and equities would recover. Sometimes they don't. Or at least... not for a long time. And you really won't know what your risk tolerance is until you're looking at statements showing that your portfolio is down 50% and there is no bottom in sight. At s...
by Karamatsu
Wed Jun 06, 2018 9:03 pm
Forum: Investing - Theory, News & General
Topic: Best case to convert a Bogle skeptic?
Replies: 56
Views: 6537

Re: Best case to convert a Bogle skeptic?

This is probably a fool’s errand, but have others had success convincing highly skeptical family members that the legacy advising model is a waste of significant money? Are there compelling reads to give him, airtight arguments to make? My husband and I know we’re not idiots and hate that he thinks we are. Generally I avoid trying to convince people, but this seems like a special case and one that we'll all likely face as parents get older, etc, and then if we live long enough, we'll face it again from the other direction with the son/daughter who thinks grandma should invest everything in Netflix, or whatever. Honestly I think the best way... maybe the only way... is to dig through the documents and do a side-by-side comparison of after-t...
by Karamatsu
Wed Jun 06, 2018 8:30 pm
Forum: Investing - Theory, News & General
Topic: At what point do you lose your privilege to invest (in the U.S.)?
Replies: 24
Views: 3315

Re: At what point do you lose your privilege to invest (in the U.S.)?

Generally speaking (unless you live in one of the no-no countries), you never lose your option to invest in US equities, etc. Like many countries, the US goes to great lengths to invite foreign investment... not turn it away. What can be a problem is taxes and tax-related regulations (in both countries) and other legal frameworks like FATCA that impose burdens on you and on financial institutions. Taxes can make investing in US assets costly/inconvenient. Financial institutions can make investing in US assets impossible. But it's all very country- and broker- specific, so there's no generic answer. For instance, I think you can become a "resident" of Japan as a foreigner, but this doesn't mean you need to give up your U.S. passpor...
by Karamatsu
Sat Apr 14, 2018 4:34 am
Forum: Investing - Theory, News & General
Topic: Any value investor buying a Russia fund?
Replies: 92
Views: 12124

Re: Any value investor buying a Russia fund?

I think the idea that national markets can be evaluated by the same metrics as US companies is likely to be fundamentally flawed. There are far more variables, far more unknowns, countries are so different, and their equity markets used for such different purposes that except in very stable, culturally similar, situations that allow the same kind of data fitting, I doubt it's possible to make meaningful comparisons and say that country A is overvalued while B is undervalued. And then, as a reformed value trader, just because your model says that stock X is undervalued absolutely does not mean that the market will ever wake up to share your opinion. Finally, having just come back from Ukraine and talks with investors there, anyone contemplat...
by Karamatsu
Thu Mar 29, 2018 8:35 am
Forum: Investing - Theory, News & General
Topic: Is technical analysis all smoke and mirrors?
Replies: 138
Views: 17933

Re: Is technical analysis all smoke and mirrors?

There is a definition problem but I think of "pure" technical analysis as being analysis of patterns in price action totally irrespective of what the underlying issue is (though of course, the analysis parameters differ depending on what type of asset you're talking about) or any other outside data. My take is that it's mostly just data fitting. You can find all kinds of patterns in past data, and people are amazingly creative when it comes to such things. None are absolute, of course, or somebody using them would already own the whole market. Probably the best anyone can hope for is to win more than they lose over the long run, but of course... the financial graveyards are full of people for whom the long run was just too long, a...
by Karamatsu
Tue Mar 06, 2018 7:36 pm
Forum: Investing - Theory, News & General
Topic: Are Japanese Stocks Cheap?
Replies: 30
Views: 4255

Re: Are Japanese Stocks Cheap?

I think it's important to be aware that those cultural differences apply to investment as well. Rules of thumb (often just a mixture of superstition and data fitting) used for investing in the US (such as levels for cheap/dear metrics) don't necessarily apply in other markets, which sometimes have different goals, norms, and governmental interactions. So I think Valuethinker is correct (as usual!) in saying that the equity market here has whatever valuation it does because, on average, that's what it's worth.
by Karamatsu
Mon Feb 05, 2018 1:04 am
Forum: Personal Investments
Topic: American Expats and FEIE: no tax advantaged accounts?
Replies: 21
Views: 2538

Re: American Expats and FEIE: no tax advantaged accounts?

The IRS is made aware of your contributions to a Roth IRA by the custodian (Vanguard, for example) on form 5498, box 10.
In that case what I think we can say is that although they have sufficient data to do so, they have not, at least in the past, pro-actively notified taxpayers of a potential problem until many years later.
by Karamatsu
Sun Feb 04, 2018 5:26 am
Forum: Personal Investments
Topic: American Expats and FEIE: no tax advantaged accounts?
Replies: 21
Views: 2538

Re: American Expats and FEIE: no tax advantaged accounts?

If it's a Roth IRA then the IRS probably doesn't know about your contributions and they'd only become aware of them when you make withdrawals. So... decades go by... you're retired... start looking at your IRA... and then they tell you you're liable not only for the excess contributions (and any income derived from them) but for excise tax plus interest on that unpaid excise tax that is compounded over those decades. And in the end your IRA is wiped out. So you have it right: best not to play! Also regarding income earned while in the US for business, Form 2555 is clear that is US-earned income and so cannot be excluded under the FEIE (Part II Line 14), so it seems like that amount should be available for contribution to an IRA (as long as ...
by Karamatsu
Tue Jan 02, 2018 11:33 pm
Forum: Personal Investments
Topic: Age In Bonds after 65 with 25X, 35X, 50X ??? Your Approach?
Replies: 35
Views: 4808

Re: Age In Bonds after 65 with 25X, 35X, 50X ??? Your Approach?

I'm fairly conservative these days and adhere to a rough age-in-bonds approach (actually it's age+5), but my plan is to set a floor where the minimum equity allocation is 20%, in part just because and in part because the MV curve has a kink in it at about that level, indicating that a small-ish allocation to equities had historically lower risk. While still working, and if retirement is voluntary (as opposed to mandatory age-based), I think it makes sense to increase equity a bit if it looks like you would otherwise fall short of needs, and just work longer if markets go against you. Only realize that the risks of that are very real, and there is a distinct possibility of reaching retirement with less than you would have if you'd stayed wit...
by Karamatsu
Tue Jan 02, 2018 1:10 am
Forum: Investing - Theory, News & General
Topic: Preferreds
Replies: 13
Views: 1907

Re: Preferreds

All in all I think trying to diversify across types of investment product structures is not, in and of itself, a high priority. If you look carefully, for example, there are many different types of preferreds and structured products. Some offer meaningful benefits to certain classes of investors, but if you're not a member of one of those classes, then I don't think it's a good idea to invest in a type of product simply because it exists. So with that in mind, I don't see any major reason to invest in a preferred index. From another angle, they're also just a tiny sliver of the market: the size of the US preferred stock market was estimated at $100B in 2008 ( S&P ), versus $9.5T and $4.0T for the bond market, so... less than 1%. If you ...
by Karamatsu
Sun Dec 31, 2017 3:49 am
Forum: Non-US Investing
Topic: Japanese Investments (Expat using Yen)
Replies: 2
Views: 550

Re: Japanese Investments (Expat using Yen)

I'm not clear on what the scenario is. Are you a resident of Japan? What is your country of citizenship? It matters because most brokers are unlikely to open an account for a non-(Japan)-resident unless they're Japanese citizens. In addition, if you are a US citizen, then owning shares of most (if not all) Japanese-domiciled funds would have very serious US tax implications that you would need to understand clearly before investing.

But if none of that's a problem then there are lots of mutual fund families. Most are offered through banks or brokerages. There are also ETFs but they're not as common in Japan as in the US. It's funny what catches on and what doesn't.
by Karamatsu
Thu Nov 23, 2017 1:27 am
Forum: Personal Investments
Topic: Slanting International geographically or regionally
Replies: 25
Views: 2354

Re: Slanting International geographically or regionally

I am sure many BH slant their International toward or away from Emerging Markets but do any BH slant them geographically or regionally? At one point I considered separating, say, Europe from Asia-Pacific, but it was more for rebalancing than because I had premonitions about which region might be going up/down anytime soon. If I'd done that, I would have used the Vanguard ETFs at the time: VPL for Asia-Pacific and... I think it's VGK? for Europe? In the end, though, I decided that simplicity was my friend. Of course, having said that, I continue to separate international into developed (SCHF), developed-small (SCHC), and EM (SCHE), but that's just to obtain greater market coverage, not to tilt. The one country I think of doing something spe...
by Karamatsu
Wed Nov 22, 2017 4:10 am
Forum: Personal Investments
Topic: First time investor looking to jump in market but apprehensive with record highs
Replies: 23
Views: 4199

Re: First time investor looking to jump in market but apprehensive with record highs

Whether you DCA or go all-in at once, what you want is an asset allocation that you can be comfortable with no matter what the market does. This is because, over the next 30-40 years, it will probably do just about everything. We all know that, but nobody knows when. So treat your uneasiness about investing at high valuations with the respect it deserves, and choose an asset allocation that you can be comfortable with EVEN IF you went all-in with a lump sum, and equity market indices drop 50% the next day. What would that allocation be? Well the conservative advice when I started investing was age-in-bonds, so for you guys maybe 35% bonds, 65% equities (for the investment portfolio, after the emergency fund, etc, gets taken out). But if you...
by Karamatsu
Tue Nov 21, 2017 6:02 pm
Forum: Investing - Theory, News & General
Topic: Dormant Bank Accounts
Replies: 4
Views: 1440

Re: Dormant Bank Accounts

I don't see any advantage to keeping an account that has no balance. There is some value in dividing your cash, in case one bank runs into trouble (financial or operational/technical) and becomes inaccessible for a time. Just make sure that any bank where you intend to "park" cash doesn't have an inactivity fee, and check now and then to make sure that they haven't instituted one.
by Karamatsu
Sun Oct 15, 2017 9:21 pm
Forum: Personal Investments
Topic: The theory seems irrelevant. How does one execute?
Replies: 23
Views: 2708

Re: The theory seems irrelevant. How does one execute?

Someone suggested to me that my experience with cryptocurrency would give me the fortitude to invest in the stock market. I do not think that it does, but feel like I can't just sit on cash for the rest of my life. What do I do? Based on what you've said here and in other posts, I suggest dialing back the equity allocation. For one thing, there is the age-old advice that if you don't need to take risk, don't. If you truly already have enough, then all you really need to do on the financial side (black swans aside), is manage inflation and taxes. For more on that view, look up books/articles by Zvi Bodie, keeping in mind that real interest rates are still quite low these days. Alternatively, you could aim for the kind of 20% equities, 80% b...
by Karamatsu
Fri Sep 29, 2017 4:41 am
Forum: Investing - Theory, News & General
Topic: Share buybacks vs Dividends
Replies: 102
Views: 8338

Re: Share buybacks vs Dividends

There is, however, the problem that, on average (and somewhat counter-intuitively), companies doing share buybacks typically buy when their shares are high, creating a buy-high sell-low dynamic that, if nothing else, lends support to the idea that it's hard for anyone -- even insiders -- to generate alpha. There is some other criticism of buybacks as merely ways for executives to extract value from companies and into their own pockets [Harvard Business Review], though I've seen the same thing happen with dividends when insiders were major shareholders who didn't want to sell shares because they needed to maintain control.

Nothing is ever simple, though passive investing comes close.
by Karamatsu
Mon Sep 18, 2017 1:55 am
Forum: Investing - Theory, News & General
Topic: Good books for bond investing?
Replies: 16
Views: 3551

Re: Good books for bond investing?

Well, there is Larry Swedroe's own The Only Guide to a Winning Bond Strategy You'll Ever Need. It's a question that gets debated around here every now and then (the merits of individual issues versus funds). I always have the sneaking suspicion that the timing of turnover in a fund could lead to lower total return, all else equal, but my bond allocation now tilts toward funds for simplicity's sake.
by Karamatsu
Sun Sep 03, 2017 7:14 pm
Forum: Personal Investments
Topic: GLOBAL 1M$ Conservative Growth Portfolio?
Replies: 25
Views: 3314

Re: GLOBAL 1M$ Conservative Growth Portfolio?

One concern I'd have with a large bond allocation is unexpected inflation. Over the long run and on average, I guess you'd be covered by the intermediate term, but at any given moment, markedly increased inflation would raise rates and depress the market value of the majority of your bonds, making them look less "conservative" than you might want. To cover that possibility, you might consider shifting some of the bond allocation to a TIPS fund. Lower return, most likely (though with the 70's in there the backtesting might not look so bad), but it's insurance.
by Karamatsu
Tue Aug 22, 2017 7:55 am
Forum: Non-US Investing
Topic: Investing while residing in Japan
Replies: 3
Views: 952

Re: Investing while residing in Japan

Welcome! opening a NISA is the obvious first thing to do. Does it give access to low-cost funds like Vanguard ? Which bank seems the most "gaijin" friendly ? Banks tend to be very expensive generally, so your best bet is probably to go through a real brokerage. I use SMBC because I was forced to, but I also hear a lot about Nomura and Rakuten. There are a bunch of us (foreign investors in Japan) here, so and others should chime in soon. Also be sure to check the Wiki article on Investing in Japan . is there an online broker that is available in English and allows automatic taxation handling as a resident in Japan? Unfortunately I don't know of any bank/broker in Japan that offers an English interface. Automatic taxation should be ...
by Karamatsu
Sun Jul 02, 2017 7:50 am
Forum: Investing - Theory, News & General
Topic: The "angle" at Schwab
Replies: 32
Views: 6376

Re: The "angle" at Schwab

Here's my question: What "angle" should I expect... I've been at Schwab more than 25 years now and have seen the angles change now and then, but generally they are not pushy at all. At my first visit with them (also at a physical office), the representative recommended index funds with age in bonds. If only I'd listened!! In my experience they've never pushed any specific product. The closest that ever came was their list of no-fee mutual funds and offering to help me get set up with their (free) trading platform. They did assign an advisor but I don't remember her ever recommending any purchases, so... not like the usual broker, so no cold calls, no "hot tips." She's been more like a contact person in case I needed any...
by Karamatsu
Sat Jun 10, 2017 3:21 am
Forum: Investing - Theory, News & General
Topic: 100% Stock Portfolio?
Replies: 148
Views: 27477

Re: 100% Stocks For A Late Starter?

Do you think it is a bad idea?
Yes, assuming that 100% really means 100% of assets, then I think it's a bad idea.. Better to choose a more balanced portfolio.
by Karamatsu
Fri Jun 09, 2017 3:08 am
Forum: Investing - Theory, News & General
Topic: Does anyone feel they missed out on AMZN, NFLX,TSLA?
Replies: 113
Views: 18955

Re: Does anyone feel they missed out on AMZN, NFLX,TSLA?

Does anyone else feel that way? Did anyone else act on similar impulses and purchase stocks like these?
No. These things are never as safe or as sure in "real time" as they are in hindsight. Consider right now. What stock seems undervalued compared to your estimate of its potential today? Is it easy to see? I don't think so. For what it's worth, I bought AAPL in 1990 and sold it to buy index funds sometime in the mid 2000's, if I remember right. If I'd known what was going to happen, of course I wouldn't have done that, but I didn't know. Nobody did. Same deal with Amazon, Netflix, Tesla, Google...
by Karamatsu
Fri Jun 02, 2017 5:21 am
Forum: Investing - Theory, News & General
Topic: Dealing with Impatience reaching financial goals
Replies: 36
Views: 7216

Re: Dealing with Impatience reaching financial goals

How do you guys deal with it? Do you also get impatient/restless as you are approaching a major financial milestone (financial independence, retirement, a nice big round number, etc.), do you start really pinching pennies to try to get to that milestone sooner?
I suppose I just try to maintain a constant rhythm... maintain my saving/investment/speculation pace, and not worry too much about the ups and downs of the total. It probably helps if the other non-financial aspects of life are more than enough to keep you busy!
by Karamatsu
Thu May 18, 2017 8:08 am
Forum: Non-US Investing
Topic: Global or Country Fund
Replies: 12
Views: 1313

Re: Global or Country Fund

If one does not a opinion on if a currency is going to strengthen or weaken - which most global bond funds don't have - then one can enter into a zero cost collar.
Interesting! Clearly it's possible to hedge so that you neither benefit nor lose from exchange rate fluctuations, but how is it possible to do that at no cost? It would be like getting an insurance policy for free.
by Karamatsu
Thu May 18, 2017 8:00 am
Forum: Personal Investments
Topic: Social Security Planning (Incarcerated Spouse)
Replies: 5
Views: 2461

Re: Social Security Planning (Incarcerated Spouse)

Thanks for the question and the answer. Good to know,
by Karamatsu
Thu May 18, 2017 7:52 am
Forum: Non-US Investing
Topic: Choosing a foreign broker. 1099-DIV issue.
Replies: 3
Views: 749

Re: Choosing a foreign broker. 1099-DIV issue.

How much is the 1099-DIV worth? The 1099-DIV isn't worth much at all, as long as you or your broker keep track of dividends received. There are some nuances. For example, return-of-capital often looks like a dividend but isn't. I can imagine the 1099-DIV being especially helpful when dealing with mergers, spin offs or other events when investing in individual stocks, but I wouldn't really know because I haven't filed before. I think you may be confusing 1099-DIV with 1099 generally. There are several different 1099 forms (DIV, INT, OID, B). The one that would be most useful in these cases (mergers, etc) is B. If it's well-done, that form can be worthwhile, especially if it lists the cost basis of each lot, which becomes even more valuable ...
by Karamatsu
Mon May 15, 2017 6:16 pm
Forum: Non-US Investing
Topic: Global or Country Fund
Replies: 12
Views: 1313

Re: Global or Country Fund

I want to do Global Stocks but on the bond side ( 30% ) am I best to go UK ( as i'm based here ) all Global? The usual advice is to invest in equities globally but bonds locally because exchange rate effects can easily overwhelm the yields on high-quality bonds, which in this type of portfolio (like mine), are the only bonds you'd want to have. It's true that there are currency-hedged bond funds, but the hedge comes at a price that would further subtract from return. If you were in a country where government credit risk and currency stability were issues, that would be an argument for diversification, say, by adding USD or EUR denominated bonds. The UK has some uncertainty headed its way with Brexit and (maybe) Scotland again, but still......
by Karamatsu
Mon May 08, 2017 6:37 am
Forum: Investing - Theory, News & General
Topic: A Boglehead Guide to Buying Individual Stocks
Replies: 85
Views: 10820

Re: A Boglehead Guide to Buying Individual Stocks

The point would be learning how to value companies rather than actually making money. In that case I found the Streetsmart Guide to Valuing a Stock to be a good practical introduction. Not too simple, not too complicated/theoretical. I recommend that you build a spreadsheet (or write custom software) as the best way to learn and apply the various computations. You do need a lot of company information, preferably quarterly data going back 3-5 years. If you're at Schwab you can find what you need in the research reports they provide but I'm not sure about other brokers. As with any kind of predictive analysis, what you'll find is that the results are only as good as the assumptions that go into it, but this, too can be fun to experiment with...
by Karamatsu
Thu Apr 20, 2017 6:42 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe says "Goodbye."
Replies: 445
Views: 80223

Re: Larry Swedroe says "Goodby."

Just adding my thanks. I'm know we're all better investors for your contributions here and I hope somehow we can still be alerted to your articles. Also just personal thanks for all your reasoned arguments about the good, the flawed, the bad, and the ugly, as well as the steady voice during the dark days of 2008.

Enjoy the time with your family! Investing and finance are challenging and interesting but living a good life is what they are for!
by Karamatsu
Wed Apr 19, 2017 9:51 pm
Forum: Non-US Investing
Topic: Planning for Retirement while Claiming Foreign Earned Income Exclusion
Replies: 11
Views: 1771

Re: Planning for Retirement while Claiming Foreign Earned Income Exclusion

If my math is right that gives me 45% US Equities, 40% International Equities and 15% US Treasury Bond. Does this seem reasonable? It certainly seems in the ballpark, which is the best any of us can really do! One thing you'll want to consider when you implement this is whether to reinvest dividends. I reinvest because I'm lazy and it automatically keeps me fully invested, but there are arguments on the other side, too (search around and you'll find threads where we hash that out). Aside from that, once you're set up it's just a matter of checking every now and then to see if you need to rebalance, or placing orders if you want to invest new money. Schwab's "Positions" tab and portfolio tools will show you the current market valu...
by Karamatsu
Wed Apr 19, 2017 3:46 am
Forum: Non-US Investing
Topic: Planning for Retirement while Claiming Foreign Earned Income Exclusion
Replies: 11
Views: 1771

Re: Planning for Retirement while Claiming Foreign Earned Income Exclusion

I suppose I'm curious why you would want to have SCHA and SCHX at the same time? If you're ambivalent about which size you want to tilt toward, then perhaps it would be simpler just to have 50% in SCHB? Alternatively, if you want to tilt toward small, you could just eliminate SCHX. Then if you want to keep nice round numbers you could replace SCHX with SCHE and get exposure to emerging markets. That way you'd have an even 40/40 split between US and foreign with the rest in US government bonds. As for bonds, by splitting between SCHR and SCHO essentially what you're doing is setting your average duration between the two. That's not a bad idea, but if you're in this for a long period (as I think you are), it might be better to go with just SC...
by Karamatsu
Mon Apr 17, 2017 10:24 pm
Forum: Personal Investments
Topic: I got a FACTA-related form from my home country?
Replies: 24
Views: 2670

Re: I got a FACTA-related form from my home country?

What would the possible repercussions be if I just send back the form saying I am not a US citizen/resident? I have no money in my home country also, except for $1000 in that bank. It is unlikely that anybody here can really answer that question for you, most obviously because you don't identify your home country, but even if you did... how could any of us know for sure? If this bank account is your only foreign asset then you are well below the FINCEN (FBAR) and FATCA reporting limits, so I doubt the US would care, but knowingly providing false information to your bank could create problems in your home country and, at worst, expose you, or even your relatives, to criminal charges. I think the best solution is as people have suggested: cl...
by Karamatsu
Sun Apr 16, 2017 6:24 pm
Forum: Investing - Theory, News & General
Topic: Investors backing off their equity AA primarily due to 8-year bull market?
Replies: 56
Views: 7017

Re: Investors backing off their equity AA primarily due to 8-year bull market?

I'm not sure how to tell if there is a trend of that kind? If so it would mean that people were too aggressive to begin with.. Personally, the only selling I've done was to rebalance.