Search found 7448 matches

by Doc
Mon Sep 18, 2017 2:40 pm
Forum: Investing - Theory, News & General
Topic: International Equity: Are managed funds better than Index funds?
Replies: 35
Views: 2021

Re: International Equity: Are managed funds better than Index funds?

lack_ey wrote:
Mon Sep 18, 2017 2:33 pm
Moreover there is no "sensible way" to define things ...
I read the Sharpe quote a couple of times every year and I always get a laugh out of "sensible'.
by Doc
Mon Sep 18, 2017 2:21 pm
Forum: Investing - Theory, News & General
Topic: International Equity: Are managed funds better than Index funds?
Replies: 35
Views: 2021

Re: International Equity: Are managed funds better than Index funds?

Though under Sharpe's definition, index funds following anything other than the total market are active too. If "active" and "passive" management styles are defined in sensible ways I guess the hangup here is "sensible ways". I'm not sure how lack_ey got where is but I would guess that he is using ...
by Doc
Mon Sep 18, 2017 1:37 pm
Forum: Investing - Theory, News & General
Topic: International Equity: Are managed funds better than Index funds?
Replies: 35
Views: 2021

Re: International Equity: Are managed funds better than Index funds?

So you do need to check the data. I think William Sharpe can do the math. "If "active" and "passive" management styles are defined in sensible ways, it must be the case that (1) before costs, the return on the average actively managed dollar will equal the return on the average passively managed do...
by Doc
Mon Sep 18, 2017 12:25 pm
Forum: Investing - Theory, News & General
Topic: Can a TIPS ladder 'fail' ?
Replies: 101
Views: 8144

Re: Can a TIPS ladder 'fail' ?

Thanks #cruncher, I guess I'm not as conversant with Fed speak that I thought.

And thanks to Nisiprius also.
by Doc
Mon Sep 18, 2017 12:20 pm
Forum: Investing - Theory, News & General
Topic: International Equity: Are managed funds better than Index funds?
Replies: 35
Views: 2021

Re: International Equity: Are managed funds better than Index funds?

A very valid, and important, point. My best guess is that the SPIVA reports put out by Standard and Poors would look quite different if they were rerun after excluding funds that had consistently bottom quartile performance. This would likely have the greatest impact with bond funds and internation...
by Doc
Sun Sep 17, 2017 6:00 pm
Forum: Investing - Theory, News & General
Topic: The Difference Between Risk and Uncertainty
Replies: 38
Views: 2053

Re: The Difference Between Risk and Uncertainty

lack_ey wrote:
Sun Sep 17, 2017 5:49 pm
Risk in most contexts is a potential negative outcome, ...
That's where the problem lies. Investers think of risk as losing money. But statistictions this of risk in terms of standard deviation which is both plus and minus. We all need to keep the distinction in mind.
by Doc
Sun Sep 17, 2017 10:27 am
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

Regarding "dry power" My Treasury allocation is targeted at 56% and is currently 54%. The treasuries held either directly or in a Treasury fund is 47% right now with a duration of 4.3 years. I consider that 47% as dry powder. The target is the BBgBarc Intermediate (1-10) Government/Credit Index with...
by Doc
Sun Sep 17, 2017 10:11 am
Forum: Investing - Theory, News & General
Topic: International Equity: Are managed funds better than Index funds?
Replies: 35
Views: 2021

Re: International Equity: Are managed funds better than Index funds?

However, frequently the reason why funds have 1 and 2-star ratings is because of high expense ratios, so this might be a case where a low star rating is just an indirect proxy for high expenses? Morningstar Screen: (Distinct Portfolio Only = Yes) and (Fund Category = U.S. Equity) and (Morningstar R...
by Doc
Sun Sep 17, 2017 8:20 am
Forum: Investing - Theory, News & General
Topic: International Equity: Are managed funds better than Index funds?
Replies: 35
Views: 2021

Re: International Equity: Are managed funds better than Index funds?

livesoft wrote:
Sat Sep 16, 2017 8:27 pm
M* does more than ratings which are useless.
Morningstar ratings are not useless if used appropriately. Avoid funds with 1 and 2 star ratings.
by Doc
Sun Sep 17, 2017 8:09 am
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

@MnD I don't use TBM because of ideas presented by Larry Swedroe and Jack Bogle. I avoid EM when I can because it would be such a small amount of my portfolio and I don't need the worry however small or unlikely any risk may be. Whether "distressing news" has been properly priced is unknowable until...
by Doc
Sat Sep 16, 2017 6:05 pm
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

@nisiprius
No argument. These are the kinds of ideas that I wanted to elicit with the original post.

Whether one agrees or disagrees depends a lot on our own risk/reward viewpoint.
by Doc
Sat Sep 16, 2017 4:16 pm
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

I think you missed my point. The point was that there was only a 50 bps advantage of intermediate-term Treasuries over TBM for the 3-month period Nov 2008 - Jan 2009. To get a larger benefit, you're timing would have to have been really spot on. It is not about the total return of Treasuries vs. TB...
by Doc
Sat Sep 16, 2017 2:42 pm
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

Just looking at monthly returns, Vanguard intermediate-term Treasury fund beat TBM by about two percentage points in November 2008, but only by about 30 basis points in December, and then it gave back about 1.7 percentage points more than TBM in January 2009. So over the 3-month period the advantag...
by Doc
Sat Sep 16, 2017 2:23 pm
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

And has anyone posted a chart showing how TBM compared with various Treasury Funds during periods of Crisis? (or has the composition of TBM changed over time; perhaps enough that historical data doesn't help right now?) Some 35 year 12 month rolling return of Vanguard Intermediate-Term Treasury Fun...
by Doc
Sat Sep 16, 2017 1:35 pm
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

All the information and conjecture you have plus much more is priced into treasury, agency and corporate bonds. Your "event" might indeed happen and prices may move the opposite of your expectations. That's really common actually. So for this to work you have to be right about the event, right abou...
by Doc
Sat Sep 16, 2017 11:32 am
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

Having said all this I always hate bonds at 2.20 and below on the 10 year in this environment, and while not as afraid as I once was of a bond disaster, I don't really not a fan of Bond Funds with an essentially fixed duration at this juncture so I personally prefer CDs or Individual Bonds that I w...
by Doc
Sat Sep 16, 2017 11:08 am
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

And you will then move back into TBM when Washington is functioned like a well-oiled bipartisan machine, international bad guys all throw in the towel and are replaced with enlightened and benevolent democratic leadership and the weather and climate is just perfect coast to coast and will stay that...
by Doc
Sat Sep 16, 2017 11:05 am
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

You we speaking as though the effect would be an unknown for 3-6 months, I would see it is more like a 1 month period at most, starting a week before landfall. My time frame estimate was based on Washington dysfunction but I didn't want to get into forbidden territory so I used the broader "distres...
by Doc
Sat Sep 16, 2017 9:30 am
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

As for hurricanes and government dysfunction, as long as they stay within certain limits those are not necessarily negative events from the market's perspective. I've been looking at a price chart of iShares 3-7 Year Treasury Bond ETF (IEI) as a quick indicator of what the price of a seven year tre...
by Doc
Sat Sep 16, 2017 7:23 am
Forum: Investing - Theory, News & General
Topic: Vanguard Ultra-Short-Term Bond Fund now available
Replies: 74
Views: 17151

Re: Vanguard Ultra-Short-Term Bond Fund now available

Morningstar rates both funds A for credit risk, but I don't know if it's valid to compare credit ratings for funds of different duration. It's the bonds themselves that are rated by the rating agencies not M*. M* uses a weighted average of the bonds to get the fund rating. The weight is the probabi...
by Doc
Fri Sep 15, 2017 5:41 pm
Forum: Investing - Theory, News & General
Topic: Hedge Your Currency Risk When Investing Abroad ?
Replies: 17
Views: 996

Re: Hedge Your Currency Risk When Investing Abroad ?

Here's a 3 month rolling return chart for the hedged and unhedged version of the Tweedy, Browne Global Value Fund https://s26.postimg.org/xw6y2rnax/Tweedy_Browne.jpg Here's the link to the Morningstar chart if anyone wants to play with the rolling return period. http://quotes.morningstar.com/chart/f...
by Doc
Fri Sep 15, 2017 5:33 pm
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

But what about selling some of that total bond market fund and buying say five year Treasuries. We talk about stocks and bonds when what we mean is stocks and fixed-income, right? In that case wiggling around inside fixed-income would seem okay, as long as you keep your wide, fixed-income diversifi...
by Doc
Fri Sep 15, 2017 4:55 pm
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

I do not believe, however, that it is time to make wholesale changes in asset allocation based on fear of an imminent market collapse. I am not suggesting making any change in the overall AA just changing the makeup of the bond portion. I am not a fan of selling TBM and moving to Treasuries either....
by Doc
Fri Sep 15, 2017 4:36 pm
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

DaftInvestor wrote:
Fri Sep 15, 2017 4:34 pm
We've always had hurricanes, Washington dysfunction, and tension with other global powers.
Stay the course.
Did you buy equities during the Lehman crisis in '08?)
by Doc
Fri Sep 15, 2017 4:35 pm
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Re: Distressing news -> Flight to Safety ?

If you truly believe a storm is coming, exchanging out of TBM into treasuries is a bit like adding plywood cladding to your underground bunker, while leaving your glass windows open. I like that comment but I don't agree. In times that stock markets crash, Treasury prices generally rise steeply whi...
by Doc
Fri Sep 15, 2017 4:09 pm
Forum: Investing - Theory, News & General
Topic: Distressing news -> Flight to Safety ?
Replies: 75
Views: 6422

Distressing news -> Flight to Safety ?

Hurricanes, North Korea, Washington dysfunction, maybe a DOW bubble, so is it time for some protection? OK selling equities and buying bonds is not staying the course. But what about selling some of that total bond market fund and buying say five year Treasuries. Is anyone willing to accept a loss i...
by Doc
Thu Sep 14, 2017 12:58 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard Customer Service
Replies: 274
Views: 29188

Re: Vanguard Customer Service

This has been my experience as well. I have invested at Vanguard since 1980. Thirty seven years of good service for me. When asked, I recommend Vanguard to others. Vanguard mutual funds are top notch. Vanguard Brokerage Service is a another whole matter. In order to be the very lowest mutual fund p...
by Doc
Thu Sep 14, 2017 11:19 am
Forum: Investing - Theory, News & General
Topic: Hedge Your Currency Risk When Investing Abroad ?
Replies: 17
Views: 996

Hedge Your Currency Risk When Investing Abroad ?

Jack Bogle has made the argument that U.S. investors don't necessarily need to venture outside the U.S. market to get global exposure because most large-cap U.S. stocks have global businesses and yet foreign stocks have greater currency risk than U.S. stocks. He (Bogle) did mention that foreign com...
by Doc
Wed Sep 13, 2017 8:09 am
Forum: Investing - Help with Personal Investments
Topic: Bonds with limited tax advantaged space
Replies: 17
Views: 1431

Re: Bonds with limited tax advantaged space

Doc, did you mean to put the short term treasuries into taxable, not tax-advantaged? Yes. No, senior moment. I edited the original post. Tax efficiency is tax rate times distribution. With low rates on short Treasuries they may be more tax efficient than some equity funds for many. You need to do y...
by Doc
Tue Sep 12, 2017 10:26 am
Forum: Investing - Help with Personal Investments
Topic: Bonds with limited tax advantaged space
Replies: 17
Views: 1431

Re: Bonds with limited tax advantaged space

Another option is to break up the bond part of your 3-fund portfolio into its components and put the most tax efficient parts like short Treasuries into tax advantaged taxable and the least tax-advantaged parts like intermediate corporates into tax advantaged. Edit: Typo, Thanks retiredjg for the co...
by Doc
Tue Sep 12, 2017 10:20 am
Forum: Investing - Help with Personal Investments
Topic: Vanguard Customer Service
Replies: 274
Views: 29188

Re: Vanguard Customer Service

But again I have to admit my own part in causing this issue in the first place. I wonder how many people have gone to a non-local bank in order to pick up a few basis points on their savings account or get some other kind of "special" credit card reward points. Given the problems that Alchemist des...
by Doc
Mon Sep 11, 2017 11:19 am
Forum: Investing - Theory, News & General
Topic: New Kids on the Block: Credit Risk Transfer Deals
Replies: 0
Views: 182

New Kids on the Block: Credit Risk Transfer Deals

Executive Summary Created in 2013, credit risk transfer deals are issued by Fannie Mae and Freddie Mac. The structures are designed to move mortgage credit risk from the agencies’ balance sheets to investors. The goal is to reduce the likelihood that the government (and taxpayers) will need to back...
by Doc
Mon Sep 11, 2017 10:33 am
Forum: Investing - Theory, News & General
Topic: ownership of "small cap value" stocks
Replies: 50
Views: 3103

Re: ownership of "small cap value" stocks

OP is correct. SCV stocks have been bid up over the past decade due to perceived bonus. So this lessens any advantage that existed previously. Similarly with dividend stocks, typically larger companies. Certain investors have been crowding into those to get higher "income" thus driving up the price...
by Doc
Mon Sep 11, 2017 7:47 am
Forum: Investing - Theory, News & General
Topic: ownership of "small cap value" stocks
Replies: 50
Views: 3103

Re: ownership of "small cap value" stocks

Anyhow, it may be meaningless data and I'm certainly no expert but it seems like from a very simple observation of the ownership of these small/value companies that most of the money invested in them is from investors chasing the factor-premium and this seems like it would not only eat up any facto...
by Doc
Sat Sep 09, 2017 4:44 pm
Forum: Investing - Theory, News & General
Topic: SEC plans to approve Vanguard request to list actively managed ETFs
Replies: 10
Views: 1137

Re: SEC plans to approve Vanguard request to list actively managed ETFs

The ETF structure doesn't help bond funds as much with capital gains. If interest rates fall, all bond prices rise, and that causes bond funds to sell bonds for capital gains. Vanguard's bond index ETFs have distributed capital gains, while very few of the stock index ETFs have distributed any. Tha...
by Doc
Sat Sep 09, 2017 1:15 pm
Forum: Investing - Theory, News & General
Topic: SEC plans to approve Vanguard request to list actively managed ETFs
Replies: 10
Views: 1137

Re: SEC plans to approve Vanguard request to list actively managed ETFs

I wouldn't mind seeing their investment grade actively managed bond funds turned into ETFs. I use Vanguard's actively managed bond funds. I don't think I would use the ETF share class. But that said, the intermediate investment grade fund distributed a significant amount of both short and long term...
by Doc
Fri Sep 08, 2017 3:26 pm
Forum: Investing - Theory, News & General
Topic: Ally savings rate raised to 1.20%
Replies: 41
Views: 5264

Re: Ally savings rate raised to 1.20%

I believe the Vanguard's Ultra Short is invested in Auto Loans/Lease bonds. Buyer beware of what they own after the 2008 crisis. The ABS market froze during the crisis due to lack of liquidity. You are not comparing apples with apples when it comes to the amount of risk. Right, it has ~40% in asset...
by Doc
Thu Sep 07, 2017 3:53 pm
Forum: Investing - Theory, News & General
Topic: Ally savings rate raised to 1.20%
Replies: 41
Views: 5264

Re: Ally savings rate raised to 1.20%

Will some of you guys explain to me why you would want to go through the hassle of of an "Ally" savings account at 1.2% when the SEC yield on Vanguard's Ultra Short is 1.46% (1.57% for admiral shares). Is not having the price vary by ±20 bps that important?
by Doc
Tue Sep 05, 2017 10:28 am
Forum: Investing - Theory, News & General
Topic: Is it wise to direct deposit Social Sec to Vanguard?
Replies: 17
Views: 1926

Re: Is it wise to direct deposit Social Sec to Vanguard?

Deposit it in the bank.

Banks are for checking, brokerage accounts are for investing. Conflating the two makes things more complicated not simpler.

FWIT my pension check comes from Fidelity but I have it deposited in our checking account not our Fidelity account.
by Doc
Mon Sep 04, 2017 1:51 pm
Forum: Investing - Theory, News & General
Topic: Do you reinvest your dividends/capital gains?
Replies: 76
Views: 8928

Re: Do you reinvest your dividends/capital gains?

Getting back to one of the posters who prompted this discussion, the amount you see available in your settlement fund to trade is actually there and available to trade regardless of what alerts you might get. Yes that warning can be misleading to those not familiar with the details of the rules but...
by Doc
Sun Sep 03, 2017 5:35 pm
Forum: Investing - Theory, News & General
Topic: Do you reinvest your dividends/capital gains?
Replies: 76
Views: 8928

Re: Do you reinvest your dividends/capital gains?

Artsdoctor, you are confusing me. (I'm only addressing Vanguard Brokerage Service.) If you transfer money in, it is sometimes held. (Sometimes, it is not; the money I transfer in from Fidelity is immediately available.) It's been my experience that the money is held "until it clears" from banking ac...
by Doc
Sun Sep 03, 2017 10:13 am
Forum: Investing - Theory, News & General
Topic: Do you reinvest your dividends/capital gains?
Replies: 76
Views: 8928

Re: Do you reinvest your dividends/capital gains?

Whatever the proper word is, Vanguard Brokerage puts restrictions on those new shares until they are confident your ACH transfer was good. It is not the ACH transfer per se and it is not just Vanguard. It is an industry standard. But we can restrict trading in your accounts if your transactions vio...
by Doc
Sun Sep 03, 2017 7:44 am
Forum: Investing - Theory, News & General
Topic: Do you reinvest your dividends/capital gains?
Replies: 76
Views: 8928

Re: Do you reinvest your dividends/capital gains?

But those new shares are provisional until the money transfer from your checking account completes They are not "provisional". You own them. You just will have a trade violation if you sell before settlement. It may be that the settlement date is longer than the normal time period because of the in...
by Doc
Sat Sep 02, 2017 8:47 pm
Forum: Investing - Theory, News & General
Topic: Do you reinvest your dividends/capital gains?
Replies: 76
Views: 8928

Re: Do you reinvest your dividends/capital gains?

You can also try clicking on the Buy link of your Total Stock Market fund. See what options you have. You may be able to transfer directly from your bank directly to the fund and bypass the settlement account altogether. If this is not possible right now, you can work with Vanguard to open up direc...
by Doc
Sat Sep 02, 2017 5:21 pm
Forum: Investing - Theory, News & General
Topic: Do you reinvest your dividends/capital gains?
Replies: 76
Views: 8928

Re: Do you reinvest your dividends/capital gains?

I initiated a transfer on the Vanguard website of $1000 from my linked checking account to my taxable brokerage settlement account about a month ago. It took three days before I was able to move that money, along with a small amount of dividends, into VTSAX. The money doesn't have to be in your set...
by Doc
Sat Sep 02, 2017 5:01 pm
Forum: Investing - Theory, News & General
Topic: Vanguard ETF question: Why aren't all ETF offerings displayed?
Replies: 7
Views: 729

Re: Vanguard ETF question: Why aren't all ETF offerings displayed?

Another reason to be less concerned with VIOV is that the higher-volume (but higher-cost) IJS tracks the same index, and arbitrage keeps the prices linked. If VIOV were at a premium to IJS, an institution could sell VIOV short and buy IJS, making a risk-free profit, and driving down the price of VI...
by Doc
Sat Sep 02, 2017 10:19 am
Forum: Investing - Theory, News & General
Topic: Vanguard ETF question: Why aren't all ETF offerings displayed?
Replies: 7
Views: 729

Re: Vanguard ETF question: Why aren't all ETF offerings displayed?

I would actually prefer VIOV (S&P 600 Value) over VBR (CRSP Small-Cap Value) in a taxable account; the tax difference from VIOV's lower yield and higher qualified dividends is enough to essentially cover the expense difference, and VIOV gets better small-cap value exposure. David, does the low aver...
by Doc
Sat Sep 02, 2017 8:34 am
Forum: Investing - Theory, News & General
Topic: Do you reinvest your dividends/capital gains?
Replies: 76
Views: 8928

Re: Do you reinvest your dividends/capital gains?

In tax-advantaged account --> I reinvest If taxable account --> send divs and cap gains to money market account, so I don't have to track of cost basis of these smaller purchases Same here. Then I put additional money in the MM settlement account and invest the whole amount. Note that it takes thre...
by Doc
Wed Aug 30, 2017 9:29 am
Forum: Investing - Theory, News & General
Topic: Vanguard Announces Plans To Launch Total Corporate Bond ETF
Replies: 41
Views: 6161

Re: Vanguard Announces Plans To Launch Total Corporate Bond ETF

I understand the cutely named "riding the yield curve" concept. It's unclear why you're quoting it as a *tax advantage* that actively managed funds have over ETFs, which was the original question a poster asked that I was trying to narrowly address. Selling a bond before maturity often times conver...
by Doc
Tue Aug 29, 2017 10:44 am
Forum: Investing - Theory, News & General
Topic: Vanguard Government Bond Index Funds changing names and indices (dropping agency bonds)
Replies: 56
Views: 5652

Re: Vanguard Government Bond Index Funds changing names and indices (dropping agency bonds)

Update from Morningstar analyst report: The principal benefit of the change will be lower transaction costs as the government-agency debt portion, the remaining 10% of the index, has been rapidly falling. The amount of agency debt outstanding has shrunk, on average, by 15% year over year from 2011 t...