Search found 6318 matches

by Doc
Wed Jul 27, 2016 1:47 pm
Forum: Investing - Theory, News & General
Topic: Interesting Interaction with Edward Jones
Replies: 31
Views: 1956

Re: Interesting Interaction with Edward Jones

island wrote:Door to door is a common thing? Wow.

We used to have missionaries come to our door several times a year until they finally realized our family settled Utah. (Inside joke. :D )
by Doc
Wed Jul 27, 2016 1:42 pm
Forum: Investing - Theory, News & General
Topic: Two-factor authentication via text messaging
Replies: 11
Views: 1098

Re: Two-factor authentication via text messaging

We don't use phones or public WiFi for financial transactions. We are in a relatively remote area so our home WiFi is unlikely to be hacked. We have voice verification at two of our three brokers. Money can only be transferred out of our account to pre-established banks. The one broker without voice...
by Doc
Wed Jul 27, 2016 1:30 pm
Forum: Investing - Theory, News & General
Topic: Interesting Interaction with Edward Jones
Replies: 31
Views: 1956

Re: Interesting Interaction with Edward Jones

Several years ago an EJ rep knocked on my door to introduce himself as he was opening a new office in the area. He was very nice. I said welcome to the neighborhood and wished him good luck. Never heard from him again and have no idea where his "new" office is. And don't care. That being s...
by Doc
Sun Jul 24, 2016 4:55 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

Doc wrote: The reason we go around in circles is that you look at your FI as a source of return and I look it only as a source of risk reduction. How in the world do you come to this conclusion??? I always talk about the risk/return trade-off of CDs in discussing their advantages over bonds or bond...
by Doc
Sun Jul 24, 2016 1:59 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

So you are counting on what I'm now calling speculative returns with all of your intermediate-term and long-term Treasuries, as well as with all of your corporate bonds, which is the majority of your fixed-income portfolio! CDs provide a higher safe return than Treasuries or corporate bonds, provid...
by Doc
Sun Jul 24, 2016 1:09 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

I think you're misunderstanding my comment, as well as the analysis. I'm not saying that you don't rebalance from bonds into stocks during the crash, which is exactly why I used 5/25 rebalancing bands in the analysis instead of annual rebalancing (thank you PortfolioVisualizer for adding this featu...
by Doc
Sun Jul 24, 2016 9:07 am
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

I do not want to count on speculative returns with the bulk of my fixed income. Neither do I. I "need" only about 20% of my FI to be in Treasuries to handle a 40% bear. I have about 30% because that's convenient and tax efficient for our mix of accounts/brokers. Our total FI portfolio is ...
by Doc
Sun Jul 24, 2016 8:55 am
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

Thinking about this a little more. Although it's clear that you got a rebalancing bonus if you rebalanced from Treasuries into stocks in late 2008, most of us didn't lump-sum into our portfolios when Treasuries were at their high yields / low prices shortly before the crash, and then liquidate our ...
by Doc
Fri Jul 22, 2016 11:25 am
Forum: Investing - Theory, News & General
Topic: High Yield Junk Bonds
Replies: 42
Views: 3284

Re: High Yield Junk Bonds

Abuss, look at recent posts by Kevin and Doc in Swedroe's "Another look at corporate bonds" thread. I thought it would be useful to look at these three funds over what seems to be Larry's favorite time period: the longest time period for which we have data. This is Nov 1993 through Jun 201...
by Doc
Thu Jul 21, 2016 2:17 pm
Forum: Investing - Theory, News & General
Topic: Wrong cost basis method used by Vanguard
Replies: 60
Views: 7432

Re: Wrong cost basis method used by Vanguard

Now five months later - July 21st 2016 Just received a corrected confirmation for a February 2016 trade where Vanguard had used FIFO instead of Spec ID. :shock: I didn't notice at the time because I had sold the entire position and it made no difference. But it took me over an hour to figure what th...
by Doc
Thu Jul 21, 2016 2:07 pm
Forum: Investing - Theory, News & General
Topic: Alerts
Replies: 4
Views: 446

Re: Alerts

pgs59 wrote:I'm looking for something that would automatically adjust each time a stock achieves a new high.

Not exactly what you want but several sites can give you "drops or exceeds an X day moving average" alert.
by Doc
Thu Jul 21, 2016 2:03 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

I thought it would be useful to look at these three funds over what seems to be Larry's favorite time period: the longest time period for which we have data. This is Nov 1993 through Jun 2016 Using PortfolioVisualizer. Below is the table of results--it's a bit fuzzy, but you can view it directly on...
by Doc
Thu Jul 21, 2016 8:15 am
Forum: Investing - Theory, News & General
Topic: Weighting tax-deferred during rebalance for expected taxes
Replies: 3
Views: 250

Re: Weighting tax-deferred during rebalance for expected taxes

Since I see no mention of this approach anywhere, I'm assuming I'm missing something key. You're missing a lot. Try Goggling "bogleheads.org tax adjusting retirement accounts" The top of the list is The Boglehead Wiki "Tax-adjusted asset allocation". :wink: FWIW They are not &qu...
by Doc
Wed Jul 20, 2016 4:59 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

Doc wrote: Kevin, I just find the price/yield relationship in a Lehman type crisis to be just irrelevant. This statement just baffles me--especially coming from someone who has seemed so sharp on "bond math" in other posts. The price/yield relationship for bonds is invariable--it always a...
by Doc
Wed Jul 20, 2016 10:03 am
Forum: Investing - Theory, News & General
Topic: limiting Cap Gains - with ETFs ?
Replies: 17
Views: 1270

Re: limiting Cap Gains - with ETFs ?

I've gone back - and using the Morningstar TAX tab to get the Tax Cost Ratio, and adding the columns for "returns" to see how things are affected... You need to be aware M*'s tax cost ratio is based on the highest tax bracket at the time of the distribution. It is not accurate for most of...
by Doc
Tue Jul 19, 2016 5:12 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

It has everything to do with interest rates (yields), since what we've been talking about is taking advantage of a price increase in Treasuries during a financial crisis to rebalance into stocks, and price and yield are two sides of the same coin. With yield at 0%, you're only going to get signific...
by Doc
Tue Jul 19, 2016 3:14 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

So I just accept that I'm not going to get the flight-to-safety bump, but the closer yields get to 0%, the less potential there is for much of that, unless you believe that yields could go well below 0%. With a 5-year Treasury at about 1%, you're looking at less than 5% price appreciation if the yi...
by Doc
Tue Jul 19, 2016 2:18 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

Kevin, I'll hit just a few points to highlight some misconceptions and possible differences of opinion. I don't think this is the right way to look at it. The bump in price was temporary, mostly given back by May 2009 (and only 10% if you cherry pick low and high price--less for more realistic case)...
by Doc
Tue Jul 19, 2016 12:06 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

I'm not certain what you mean by "normalize", but typically with an asset allocation you want to rebalance back to your portfolio pre-crisis. So you're using bumped-up treasuries to buy depressed stocks (and elevated stocks to buy depressed treasuries). My point is that when you sell bump...
by Doc
Tue Jul 19, 2016 11:09 am
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

First thing to keep in mind is that you're probably only going to use a portion of your fixed income to rebalance into stocks. Kevin (emphasis mine) This is true, but in order to keep a fixed allocation before and after rebalancing, you will need to rebalance into the bumped-up treasuries. You will...
by Doc
Tue Jul 19, 2016 9:52 am
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

The CDs are not the first thing I'd look to for rebalancing into stocks in a bear market, although they could come into play. That's what the slug of long-term Treasuries would be for if you wanted to optimize this potential benefit in flight-to-safety scenarios (based on recent history anyway), or...
by Doc
Tue Jul 19, 2016 9:38 am
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

Doc wrote: All that being said, any of the Treasury durations probably do better than CDs in similar situations. (See Larry's comment upthread.) No, no, no. This completely misses the point. You earn so much more yield on direct 5-year CDs with good early withdrawal terms than on short-term Treasur...
by Doc
Mon Jul 18, 2016 4:18 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

But if today's interest rates are at unprecedentedly low levels, and treasuries are affected by market forces that never existed before, then why base the point on the past 90 years? It also seems like the timeframe ends with a bond bubble, which would lead to misleading conclusions. The low curren...
by Doc
Mon Jul 18, 2016 4:10 pm
Forum: Investing - Theory, News & General
Topic: VMBS vs BND
Replies: 10
Views: 838

Re: VMBS vs BND

The embedded options are unfavorable to the lender . That's where the extra yield comes from, or nobody would take on these risks. Some are big on MBS, others not so much. Some make the case that these don't mix as well with stocks or standard asset allocations. Remember we as investors in MBS are ...
by Doc
Mon Jul 18, 2016 1:33 pm
Forum: Investing - Theory, News & General
Topic: VMBS vs BND
Replies: 10
Views: 838

Re: VMBS vs BND

Vanguard Mortgage-Backed Securities primarily owns securities issued by Ginnie Mae (GNMA), Fannie Mae (FNMA), and Freddie Mac (FHLMC) so effectively very little credit risk. The "guarantee" for GSE's (Government Sponsored Enterprises) like Freddie Mae and Freddie Mac (not Ginnie Mae) has ...
by Doc
Mon Jul 18, 2016 1:16 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

One reason I don't use CD's is that you don't get the price rise (mark to market) in a flight to quality situation that you get with Treasuries. But you really don't get much flight-to-quality price increase from your short term Treasuries either. You get more from intermediate-term, and the most f...
by Doc
Mon Jul 18, 2016 10:39 am
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

Just wondering if there is some place for other types of bonds considering that any rebalancing will only be done with a portion of bonds. If you look at the portfolio as a whole too then some rebalancing could also be done into corporates or other bonds that fall during stock market crashes - ie f...
by Doc
Mon Jul 18, 2016 10:31 am
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

Doc and others, Cannot, or should not, compare the funds in isolation. Just for fun , I ran a 10 year comparison of Vanguard Intermediate-Term Treasury against funds that I actually own. This is real life. Me too, just for fun . The "super fund" that I actually own grew to $18,324.05 not ...
by Doc
Sun Jul 17, 2016 6:34 pm
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

Just for fun, I ran a 10 year comparison of Vanguard Intermediate-Term Treasury against funds that I actually own. This is real life. Me too, just for fun. The "super fund" that I actually own grew to $18,324.05 not the measly $16k of nedsaid's examples. :D And that despite a recent turno...
by Doc
Sun Jul 17, 2016 11:28 am
Forum: Investing - Theory, News & General
Topic: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %
Replies: 107
Views: 7546

Re: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %

Even when it works out and stocks recover, the benefits of rebalancing are not huge. Over the last 10 years, $10,000 in VBINX (automatically rebalanced) would have grown to $19,996 while staring with 60% VTSMX and 40% VBMFX and just letting it ride, your $10,000 would have grown to $19,569. Sure, i...
by Doc
Sun Jul 17, 2016 11:16 am
Forum: Investing - Theory, News & General
Topic: Another look at corporate bonds
Replies: 192
Views: 11025

Re: Another look at corporate bonds

Since I have the SBBI/Ibbotson historical returns handy, I assembled a customized version of the Simba spreadsheet with several 60/40 portfolios : The question that I always have with back testing is "what about the short run?" You data looks impressive but how does the rebalancing freque...
by Doc
Sun Jul 17, 2016 9:25 am
Forum: Investing - Theory, News & General
Topic: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %
Replies: 107
Views: 7546

Re: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %

Even though I am close to 30/70, I don't believe that everyone who thinks that a 75% decline is an event that could happen should base their allocations on being able to rebalance into such a decline. Nor do I believe that 30/70 would be appropriate for someone who fears that -75% could occur, but ...
by Doc
Sun Jul 17, 2016 9:18 am
Forum: Investing - Theory, News & General
Topic: Which sub-asset class in stocks would I move into bonds as I age?
Replies: 7
Views: 504

Re: Which sub-asset class in stocks would I move into bonds as I age?

Consider several things regarding REITs. 1) It's only 10%. Does 10% really make much of a difference anyway. 2) Lack of(?) covariance with equites. It's quite impressive. Here's a long term chart of Vanguards REITS and TSM using one year rolling returns. (But see #1.) Also consider the long periods ...
by Doc
Sat Jul 16, 2016 5:09 pm
Forum: Investing - Theory, News & General
Topic: What if the fed never raises rates?
Replies: 23
Views: 3196

Re: What if the fed never raises rates?

selftalk wrote:What if the sky falls !

Then a loaf of bread will cost $50. :beer
by Doc
Wed Jul 13, 2016 2:59 pm
Forum: Investing - Theory, News & General
Topic: What do you recommend for your emergency fund?
Replies: 25
Views: 2339

Re: What do you recommend for your emergency fund?

Right now my 6 - 12 month expense emergency fund is in a generic savings account - making nearly no money...and zero risk. What's an emergency? Or do you want a contingency fund? From a Web source: A contingency is a future event that cannot be predicted precisely; that is, something that is unexpe...
by Doc
Wed Jul 13, 2016 1:25 pm
Forum: Investing - Theory, News & General
Topic: What if the fed never raises rates?
Replies: 23
Views: 3196

Re: What if the fed never raises rates?

46sky wrote:If the fed never raises rates, and everyone continues investing in the stock market due to lack of other options, could the stock market continue to grow to infinity? Why not?


And a loaf of bread will cost $50.
by Doc
Wed Jul 13, 2016 12:59 pm
Forum: Investing - Theory, News & General
Topic: Short Bond Index Funds - High Turnover.
Replies: 14
Views: 1089

Re: Short Bond Index Funds - High Turnover.

AlohaJoe wrote:These are the actual holdings by dollar & maturity for the 1-3 year fund. I assume the 1-5 is similar.

Nice chart. I just a few weeks ago became aware that I could download Vanguard fund portfolios to a spreadsheet but it never occurred to me to chart the data.

Thanks.
by Doc
Wed Jul 13, 2016 12:48 pm
Forum: Investing - Theory, News & General
Topic: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %
Replies: 107
Views: 7546

Re: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %

One shouldn't be changing their FI allocation based on current market conditions unless your name is Gross. (Pun intended. :D ) Why not? There is a risk-reward trade-off that needs to be made with any investment. I might buy a 20 year treasury if its real rate were 4%. When its real rate is 0%, and...
by Doc
Tue Jul 12, 2016 8:28 pm
Forum: Investing - Theory, News & General
Topic: Short Bond Index Funds - High Turnover.
Replies: 14
Views: 1089

Re: Short Bond Index Funds - High Turnover.

One year later, there are also additional, newly issued 1-3 year issues (or 1-5), not just the new 3 year issues. To match the index are not the shorter new issues also purchased, increasing turnover? Or are you already accounting for this or maybe it's too small to matter? Perhaps growth of AUM co...
by Doc
Tue Jul 12, 2016 1:04 pm
Forum: Investing - Theory, News & General
Topic: Short Bond Index Funds - High Turnover.
Replies: 14
Views: 1089

Re: Short Bond Index Funds - High Turnover.

Wait a minute. Let's say that you take the 1-3 year fund. That's like a ladder-like fund with two rungs: a 3-year rung, and a 2-year rung. One year later, we end up with a 2-year rung and a 1-year rung. We sell the later and buy a new 3-year rung. Right there, we see a 50% yearly turnover. That's m...
by Doc
Tue Jul 12, 2016 10:49 am
Forum: Investing - Theory, News & General
Topic: Short Bond Index Funds - High Turnover.
Replies: 14
Views: 1089

Re: Short Bond Index Funds - High Turnover.

Is the Short Term Government using mortgage dollar rolls? Some of the other index bond funds (e.g., Total Bond) do and these drive up turnover, in a sense artificially. I don't see any mortgaged backed securities. Wouldn't a mortgage roll show up there? But that assumes that the bonds held are even...
by Doc
Tue Jul 12, 2016 9:35 am
Forum: Investing - Theory, News & General
Topic: Short Bond Index Funds - High Turnover.
Replies: 14
Views: 1089

Re: Short Bond Index Funds - High Turnover.

My guess is that it is because the funds contain mostly "short-term" bonds that mature anywhere between one and three years, therefore they must be replaced as frequently as they mature, thus a very high turnover rate. That gets you some of the way but not enough as I see it. :?: If the f...
by Doc
Tue Jul 12, 2016 8:25 am
Forum: Investing - Theory, News & General
Topic: Short Bond Index Funds - High Turnover.
Replies: 14
Views: 1089

Short Bond Index Funds - High Turnover.

Can anyone help explain why some short term bond index funds have a relatively high turnover. Examples: Vanguard Short Term Gov. (1-3 year) Turnover 65% (Morningstar) Vanguard Short Term Corp (1-5 year) Turnover 62% (Vanguard & M*) I would have expected more like 33% and 20% respectively. (Based...
by Doc
Tue Jul 12, 2016 7:57 am
Forum: Investing - Theory, News & General
Topic: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %
Replies: 107
Views: 7546

Re: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %

I disagree. We were at 50/50, the decline in stocks was far more than 40% and who's to say it might not have gone to -80%. As it happened we remained at 50/50, but I was not about to ruin my retirement plans to satisfy some sort of asset allocation purity test by continuing to buy into a declining ...
by Doc
Mon Jul 11, 2016 6:36 pm
Forum: Investing - Theory, News & General
Topic: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %
Replies: 107
Views: 7546

Re: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %

Similarly here, we will likely really only need to rely on our assets prior to taking SS. So to ensure the ability to comfortably retire early, I decided (in 2008-09) to set some dollar based constraints. I was not going to lose the money needed for early retirement in the stock market, so decided ...
by Doc
Mon Jul 11, 2016 1:46 pm
Forum: Investing - Theory, News & General
Topic: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %
Replies: 107
Views: 7546

Re: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %

Is the contention here that putting this large amount of money in so-called "cash" is different from putting the large amount of money in so-called bonds? Can someone please explain? In today's rate environment, I think it makes little sense to fundamentally distinguish between cash, ST-b...
by Doc
Mon Jul 11, 2016 11:59 am
Forum: Investing - Theory, News & General
Topic: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %
Replies: 107
Views: 7546

Re: Maintaining 3-10 yrs expenses in fixed income in retirement rather than set %

This isn't a bad idea. What you are trying to avoid is selling stocks in a bear market to pay bills. That is a good way of destroying a portfolio in part because the stocks you sell at depressed levels will never have the chance to recover. If you put 3-10 years of expenses in fixed income, how wil...
by Doc
Sat Jul 09, 2016 1:34 pm
Forum: Investing - Theory, News & General
Topic: S+P 500 is not very diversified
Replies: 77
Views: 5378

Re: S+P 500 is not very diversified

The S&P 500® is widely regarded as the best single gauge of large-cap U.S. equities. There is over USD 7.8 trillion benchmarked to the index, with index assets comprising approximately USD 2.2 trillion of this total. The index includes 500 leading companies and captures approximately 80% covera...
by Doc
Thu Jul 07, 2016 7:50 am
Forum: Investing - Theory, News & General
Topic: 30 yr TIPs auction: 6/22, 0.8% yield?
Replies: 18
Views: 2361

Re: 30 yr TIPs auction: 6/22, 0.8% yield?

grok87 wrote:If they go any lower i won't be able to buy then anymore (as per my IPS). Thanks David Cameron.

But you can sell all those 25's and convert that stinky high tax rate ordinary income to LTCG. Thanks David. :D
by Doc
Wed Jul 06, 2016 11:29 am
Forum: Investing - Theory, News & General
Topic: Active vs. Passive: One Word, Two Meanings
Replies: 1
Views: 288

Active vs. Passive: One Word, Two Meanings

One Word, Two Meanings Everybody knows that there are active funds, and there are passive funds. Those are the terms used across the industry--by investment consultants, financial advisors, the media, fund companies, you name it. {Bogleheads} ... That language, however, has become outmoded. It was ...

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