Search found 293 matches

by QuietProsperity
Tue May 23, 2017 11:28 pm
Forum: Investing - Theory, News & General
Topic: Are risk factors just ways to take on additional risk?
Replies: 27
Views: 903

Re: Are risk factors just ways to take on additional risk?

Historically speaking, size and value seem to fit the risk story of the 3-factor model very well (More risk, more return). Momentum is the key trouble spot: https://www.youtube.com/watch?v=Uu4OeLG4Pr4&t=23s On the subject of Momentum: ...Now you've seen the Fama French isn't a tautology, it can ...
by QuietProsperity
Tue May 23, 2017 4:25 pm
Forum: Personal Finance (Not Investing)
Topic: Fortune 500 Financial Analyst vs CFP
Replies: 7
Views: 537

Re: Fortune 500 Financial Analyst vs CFP

As afan mentioned, there are a lot of questions around the financial planning industry and its future. In my personal opinion, it is starting to go through what the asset management industry started to go through about a decade ago (And is still going through) which is that consumers/clients are get...
by QuietProsperity
Tue May 23, 2017 12:33 pm
Forum: Personal Finance (Not Investing)
Topic: Question for Sole Proprietors / Small (Micro) Business Owners
Replies: 6
Views: 481

Re: Question for Sole Proprietors / Small (Micro) Business Owners

I could give a number of answers related to being a small business owner, but I'm not sure I fully understand your question. If you're asking about how I chose my current retirement plan, it was related to the business structure, first sole prop, then S Corp. The structure also affected how I paid ...
by QuietProsperity
Tue May 23, 2017 11:01 am
Forum: Personal Finance (Not Investing)
Topic: Question for Sole Proprietors / Small (Micro) Business Owners
Replies: 6
Views: 481

Re: Question for Sole Proprietors / Small (Micro) Business Owners

I would think that as a sole proprietor/micro business owner, personal finance and business finances are mostly blended together? It is recommended to keep as much separation as possible between business and personal finances. Different banks, different lines of credit, etc. Business expenses are t...
by QuietProsperity
Tue May 23, 2017 10:26 am
Forum: Personal Finance (Not Investing)
Topic: Question for Sole Proprietors / Small (Micro) Business Owners
Replies: 6
Views: 481

Re: Question for Sole Proprietors / Small (Micro) Business Owners

Well...a lot of those topics aren't "personal finance" ones unless all business-related topics are. A sales workflow was the hardest for me. I have basically always operated without an accountant. I have a bookkeeper now, but in the beginning I did all the books and taxes and learned a to...
by QuietProsperity
Mon May 22, 2017 11:40 pm
Forum: Personal Finance (Not Investing)
Topic: Question for Sole Proprietors / Small (Micro) Business Owners
Replies: 6
Views: 481

Question for Sole Proprietors / Small (Micro) Business Owners

I know most who frequent this site are fairly knowledgeable & disciplined when it comes to their personal finances, but I know at some point that was not the case. I am looking to do some research and I wanted to ask the following question. For those who are, or were, sole proprietors, self-empl...
by QuietProsperity
Mon May 22, 2017 9:49 pm
Forum: Personal Finance (Not Investing)
Topic: What type of account would you recommend for a small business?
Replies: 1
Views: 204

Re: What type of account would you recommend for a small business?

1. Traditional bank with minimal interest checking account and use the laddered CDs. 2. Something like a Fidelity Cash management with brokerage account for the LLC where I put the money in a conservative fund that may earn 1%. I am able to take small amount of risk with this money (I am assuming 1...
by QuietProsperity
Sat May 20, 2017 9:49 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Problems With The Factor Zoo
Replies: 24
Views: 2339

Re: Larry Swedroe: Problems With The Factor Zoo

Why not just screen for stocks with "quality" or whatever other "factors", rather than funds? For myself, three reasons: 1. With how inexpensive factor funds are these days, the time/cost trade off of holding a few funds versus building a portfolio with small-cap value/quality s...
by QuietProsperity
Fri May 19, 2017 10:17 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Problems With The Factor Zoo
Replies: 24
Views: 2339

Re: Larry Swedroe: Problems With The Factor Zoo

Anyone seen an intuitive argument for quality or profitability that you found convincing? As a screen, I like it. As a stand alone factor, I have not. To me, factors like size, value and momentum have stories I can believe in. The quality/profitability story, at least as a standalone factor, has al...
by QuietProsperity
Fri May 19, 2017 11:18 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Problems With The Factor Zoo
Replies: 24
Views: 2339

Re: Larry Swedroe: Problems With The Factor Zoo

What I found interesting in that paper, "Replicating Anomalies" by Hou, Xue & Zhang, is that a number of the Quality/Profitability factors did not pass their testing. The following were all found to be insignificant: Return on Equity (6 and 12-month re-balancing periods) Return on Asse...
by QuietProsperity
Tue May 16, 2017 10:51 am
Forum: Investing - Theory, News & General
Topic: What Will Burst the Next Bubble?
Replies: 66
Views: 6232

Re: What Will Burst the Next Bubble?

This is a good one. I think we are slowly losing our benefits. Between hidden inflation (and benefits that don't track it well), raising the eligible age, and AMT (which more and more people will hit with inflation) we are already losing benefits and paying higher taxes. And with the deteriorating ...
by QuietProsperity
Tue May 16, 2017 9:46 am
Forum: Investing - Theory, News & General
Topic: What Will Burst the Next Bubble?
Replies: 66
Views: 6232

Re: What Will Burst the Next Bubble?

As always, this is just speculation and for fun. Nothing I say below has an impact on my portfolio, only my set rules do. In my opinion, I do not think there are any major bubbles related to markets right now (Maybe Bitcoin). The combination of 2000 and 2008 over the last two decades has sent so man...
by QuietProsperity
Fri May 12, 2017 11:40 am
Forum: Investing - Theory, News & General
Topic: Rob Arnott [buy emerging market equities vs. US stocks]
Replies: 40
Views: 2935

Re: Rob Arnott

I think making adjustments on the margins is fine if you have really done your homework and know yourself, because chances are you will be "early" in these decisions. Bogle, Bernstein, Ferri etc. are comfortable with the idea of adjusting strategic AAs as long as you stick with it. It is s...
by QuietProsperity
Wed May 03, 2017 10:14 am
Forum: Investing - Theory, News & General
Topic: Ted Seides "Why I lost My Bet With Warren Buffett" - Bloomberg
Replies: 64
Views: 6686

Re: Ted Seides "Why I lost My Bet With Warren Buffett" - Bloomberg

I heard Ted Seides on the Invest Like The Best podcast this week and he seems to be a bit more humble about the experience in that forum compared to the Bloomberg article. With that said, there were still a number of excuses/justifications/reasons etc. given for the loss, but two stuck out to me. Ve...
by QuietProsperity
Wed May 03, 2017 12:48 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe Article On Enhancing Momentum Strategies
Replies: 60
Views: 5507

Re: Larry Swedroe Article On Enhancing Momentum Strategies

Thanks for posting Larry's article. I am still working on getting a better understanding of momentum. Could someone do a plain English explanation of cross-sectional momentum vs. time series momentum? I would really appreciate it. Imho, cross-sectional and time-series are a bit confusing for me. I ...
by QuietProsperity
Wed Apr 19, 2017 4:04 pm
Forum: Investing - Theory, News & General
Topic: Is it necessary to diversify across Factors?
Replies: 123
Views: 6852

Re: Is it necessary to diversify across Factors?

For example, go to Morningstar and chart the past performance of the Vanguard Small-Cap Value Index fund versus the Vanguard Small-Cap Growth Index fund. Broadly speaking, after listening to the factor mavens you would expect a huge difference in their performance. Go look. I have always wondered a...
by QuietProsperity
Tue Apr 18, 2017 8:57 pm
Forum: Investing - Theory, News & General
Topic: Is it necessary to diversify across Factors?
Replies: 123
Views: 6852

Re: Is it necessary to diversify across Factors?

Volatility is not to be taken in isolation. If we would stop talking about risk and return and start talking about expected return and expected volatility of return we would understand that both terms are information about one thing, namely return. It is a lot easier if one starts with a picture of...
by QuietProsperity
Tue Apr 18, 2017 5:49 pm
Forum: Investing - Theory, News & General
Topic: Is it necessary to diversify across Factors?
Replies: 123
Views: 6852

Re: Is it necessary to diversify across Factors?

ImmigrantSaver wrote:For those of you doing factor based investing but don't have the access to DFA or AQR funds, which funds/ETFs do you use instead? TIA


For me:

iShares
Vanguard
Schwab
by QuietProsperity
Tue Apr 18, 2017 5:48 pm
Forum: Investing - Theory, News & General
Topic: Is it necessary to diversify across Factors?
Replies: 123
Views: 6852

Re: Is it necessary to diversify across Factors?

Note, however, that short term volatility compounds into long term uncertainty. It is a misconception to think that volatility somehow evaporates over long periods of time. Whether people want to apply the term "risk" to the fact that future wealth held in volatile investments is subject ...
by QuietProsperity
Tue Apr 18, 2017 4:41 pm
Forum: Investing - Theory, News & General
Topic: Is it necessary to diversify across Factors?
Replies: 123
Views: 6852

Re: Is it necessary to diversify across Factors?

Do you believe a diversified U.S. stock portfolio has a higher expected return than U.S. Treasuries? Yes Do you believe those stocks are riskier than those bonds? It depends on time-horizon in my opinion. The longer the time-horizon, the less risky stocks become, eventually becoming less risky than...
by QuietProsperity
Tue Apr 18, 2017 3:00 pm
Forum: Investing - Theory, News & General
Topic: Is it necessary to diversify across Factors?
Replies: 123
Views: 6852

Re: Is it necessary to diversify across Factors?

Full Disclosure: I invest in factor funds (Value and Momentum; US and Foreign) and believe that over my lifetime of investing 50+ years (I hope!), by gaining exposure to these factors, it will improve my equity diversification, and increase my returns on the equity portion of my portfolio by 1-1.5%...
by QuietProsperity
Mon Apr 17, 2017 2:24 pm
Forum: Investing - Theory, News & General
Topic: Those that hold international equities at market-cap weight: what is your method?
Replies: 24
Views: 2443

Re: Those that hold international equities at market-cap weight: what is your method?

Using the ETFs since they are available to more people (i.e. No Admiral shares outside of Vanguard) we see that: VTI (US) - 0.05% VEU (World ex-US) - 0.11% VT (World w/ US) - 0.11% VTI (54%) / VEU (46%) - 0.08% I would say that the 0.03% increase is what I consider a convenience/simplicity charge. Y...
by QuietProsperity
Thu Apr 13, 2017 1:43 pm
Forum: Investing - Theory, News & General
Topic: Future Return - Siegel vs “new normal”
Replies: 21
Views: 2378

Re: Future Return - Siegel vs “new normal”

Even with a 50 year horizon, prices matter. The 1929 investor who bought at an expensive peak had much worse 50 year performance than the historical average. True, but it is not that big of a deal at those kind of time horizons. Once again: 1928-2016 (89 Years) Total Period Real CAGR: 6.38% If you ...
by QuietProsperity
Wed Apr 12, 2017 5:21 pm
Forum: Investing - Theory, News & General
Topic: Future Return - Siegel vs “new normal”
Replies: 21
Views: 2378

Re: Future Return - Siegel vs “new normal”

The history is pretty clear on starting valuations versus future returns and it comes down to time horizon. If you have a time horizon of 40 years and really do not expect to engage in market timing, the valuation you invest at does not make a massive difference. Valuations (At least LT valuation me...
by QuietProsperity
Mon Apr 10, 2017 6:17 pm
Forum: Investing - Theory, News & General
Topic: Vanguard VWO - no Samsung or South Korea
Replies: 17
Views: 1462

Re: Vanguard VWO - no Samsung or South Korea

Well in a 70/30 portfolio, with what some would call an aggressive allocation to EM, 10%, over the last 12 years, the return difference of using VWO or EEM was 0.08% per year. Not enough to make any sort of difference. Porfolio Visualizer Backtest If you use a FTSE based DM fund, I would stick with ...
by QuietProsperity
Thu Mar 16, 2017 11:28 am
Forum: Investing - Theory, News & General
Topic: Why go with an 80% stock / 20% bond portfolio?
Replies: 342
Views: 23163

Re: Why go with an 80% stock / 20% bond portfolio?

Per Vanguard, the worst year for a 100% stock portfolio was 1931 with a loss of 43.1% (lost money in 25 of 90 years). Is there something I'm missing here? I could not read through the whole thread so I do not know if someone else pointed it out, but be careful about looking at JUST annual data. In ...
by QuietProsperity
Sun Mar 12, 2017 12:06 am
Forum: Investing - Theory, News & General
Topic: Reasons not to check the account balance too often
Replies: 42
Views: 4071

Re: Reasons not to check the account balance too often

Prospect theory says that losses are more painful than the pleasure of gains. The more often you check, the more often you'll see a loss, and the more unhappy you'll be as a human being. https://2fhpz32auuml24khv2oi0ce1-wpengine.netdna-ssl.com/wp-content/uploads/2017/03/Longboard-Market-Experience....
by QuietProsperity
Thu Jan 26, 2017 12:54 am
Forum: Investing - Theory, News & General
Topic: Factor-Diversified Portfolio
Replies: 175
Views: 15272

Re: The fine print.

QuietProsperity: Are advisor's fees included in the DFA portfolio? Any differences in tax-efficiency? Simplicity? Thank you and best wishes. Taylor Yes the DFA portfolio did better, but no guarantees moving forward, and thinking in this way misses the overall point. Find the portfolio you believe i...
by QuietProsperity
Thu Jan 26, 2017 12:05 am
Forum: Investing - Theory, News & General
Topic: Factor-Diversified Portfolio
Replies: 175
Views: 15272

Re: Capture the "premium" ?

Mr. Bogle answers your question: "The biggest mistake investors make is looking backward at performance and thinking it’ll recur in the future." Wonder how Bogle came up with his no international stance... Honestly, the more and more I have read on this forum, books, papers, etc. it become...
by QuietProsperity
Tue Nov 29, 2016 6:00 pm
Forum: Investing - Theory, News & General
Topic: Swedroe Q & A on new book
Replies: 8
Views: 696

Re: Swedroe Q & A on new book

Because an index is frictionless in terms of trading costs and a fund is not, this would show up as lower returns for the fund relative to the index. Ok that makes sense, so trading costs come out of the potential returns and contribute to the tracking error between the funds NAV and the underlying...
by QuietProsperity
Tue Nov 29, 2016 5:23 pm
Forum: Investing - Theory, News & General
Topic: Swedroe Q & A on new book
Replies: 8
Views: 696

Re: Swedroe Q & A on new book

Of course, so I guess my follow-up would be where does that come into play? If I am using stand-alone low-cost MOM and VAL etfs and this scenario happens where the VAL etf buys a stock and the MOM sells the same stock, what is the NET effect to me? I am already paying the management fee, which I ass...
by QuietProsperity
Tue Nov 29, 2016 5:01 pm
Forum: Investing - Theory, News & General
Topic: Swedroe Q & A on new book
Replies: 8
Views: 696

Swedroe Q & A on new book

http://www.etf.com/sections/index-investor-corner/new-swedroe-book-your-complete-guide-factor-investing?nopaging=1 Larry, If you read this I have a question in regards to the multi-factor funds comments: Now, imagine you've got two funds, because you want exposure to momentum and value, and the sto...
by QuietProsperity
Sat Nov 19, 2016 4:14 pm
Forum: Investing - Theory, News & General
Topic: Adding to Small Cap
Replies: 12
Views: 1613

Re: Adding to Small Cap

orca91 wrote:If an asset class hits a rebalance band, that means another in your AA must have also hit that band. How is that blindly investing in one, if it's your plan to do so when rebalance bands are hit? Seems like that would be a planned out move.


Not true at all.
by QuietProsperity
Fri Nov 11, 2016 1:40 pm
Forum: Investing - Theory, News & General
Topic: AQR/Asness - Factor Investing Explicitly Tries to Look Lousy on Active Share
Replies: 4
Views: 537

Re: AQR/Asness - Factor Investing Explicitly Tries to Look Lousy on Active Share

For an investment strategy to be truly passive, the investor does not get to have input into the makeup of the index being tracked. Otherwise, it becomes quantitative active management. I am not sure I understand this? Every single "index" in existence had some human input into it's make-...
by QuietProsperity
Sat Nov 05, 2016 1:39 pm
Forum: Investing - Theory, News & General
Topic: What percentage of a portfolio should be in international stocks ?
Replies: 101
Views: 9622

Re: What percentage of a portfolio should be in international stocks ?

The problem with investing internationally is that you take on currency risk and are not rewarded for it: Abby, a British citizen buys a British bond in 2014 for 1000 pounds, paying 50 pounds a year. Mark, a US citizen buys, converts $1600 to 1000 pounds to buy the same bond. Fast forward to 2016. ...
by QuietProsperity
Fri Nov 04, 2016 3:08 pm
Forum: Investing - Theory, News & General
Topic: Higher expected returns = Lower expected losses?
Replies: 25
Views: 2157

Re: Higher expected returns = Lower expected losses?

Historically, if using long-term value metrics, by choosing investments that have "higher expected" returns you have actually experienced lower draw-downs on average and by the maximum. The chart below dos a great job displaying this. Now does that mean anything moving forward, who knows? ...
by QuietProsperity
Thu Nov 03, 2016 11:57 am
Forum: Investing - Theory, News & General
Topic: Smart-Beta funds?
Replies: 19
Views: 2650

Re: Smart-Beta funds?

Thanks for the link Taylor. The lesson about how hard it is to try and beat the market is true, but I would point out two things: 1. These closures were due to insufficient asset's under management. There was only $47 million in AUM between the six ETFs. 2. I think calling these funds "smart-be...
by QuietProsperity
Wed Nov 02, 2016 5:41 pm
Forum: Investing - Theory, News & General
Topic: Proprietary Funds Question
Replies: 2
Views: 257

Proprietary Funds Question

Random thought here given that I was reading some stuff about the upcoming DOL laws in relation to retirement accounts. When an advisor/broker at a wirehouse/bd recommends proprietary funds, its bad right? But when the vanguards/schwabs/fidelitys push their proprietary funds/etfs via advisors or rob...
by QuietProsperity
Fri Oct 21, 2016 12:10 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe's New Book is Available Now!
Replies: 164
Views: 19411

Re: Larry Swedroe's New Book is Available Now!

I have not read the book yet, waiting for the Kindle version, but you bring the point clearly. Twenty years for you maybe acceptable, but take someone in his 50s or in retirement that does not have that kind to time and is being asked to commit to a strategy that was not around long enough to feel ...
by QuietProsperity
Fri Oct 21, 2016 11:39 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe's New Book is Available Now!
Replies: 164
Views: 19411

Re: Larry Swedroe's New Book is Available Now!

How can one commit to any strategy beyond investing in the well stablished total markets concept, like the 3 fund portfolio or variations of it, not knowing whether within the investment time frame, seldom 30 years for most investors, the strategy will work? Above someone presents historical data o...
by QuietProsperity
Fri Oct 21, 2016 11:31 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe's New Book is Available Now!
Replies: 164
Views: 19411

Re: Larry Swedroe's New Book is Available Now!

An extra 20 or 30bp is not necessarily an issue for me either. But that means it'd should cost 30-40bp total (since Vanguard index is at 10bp or thereabouts) using the prices you're giving. I haven't seen just a ton of factor based ETFs in that price range. I mentioned one I really want to own earl...
by QuietProsperity
Fri Oct 21, 2016 10:48 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe's New Book is Available Now!
Replies: 164
Views: 19411

Re: Larry Swedroe's New Book is Available Now!

Yes, it is well know that there are plenty of factor-based funds; I already stated as much (see my last sentence just 2 posts above). The question is are there ones that are at reasonable cost. Just depends on what you think is reasonable. Since most forum members have become accustomed to fund fee...
by QuietProsperity
Fri Oct 21, 2016 12:42 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe's New Book is Available Now!
Replies: 164
Views: 19411

Re: Larry Swedroe's New Book is Available Now!

But back to the book, I guess I was hoping the book was for everyone, including those that don't have DFA access. I'm among the millions that don't have DFA access, but I do have access to some really dirt cheap index funds on the order of 10 basis points (as does everyone else). I'm going to need ...
by QuietProsperity
Tue Oct 18, 2016 12:52 pm
Forum: Investing - Theory, News & General
Topic: AQR Large Cap Multi Style YTD Performance
Replies: 7
Views: 891

Re: AQR Large Cap Multi Style YTD Performance

Hi, Why is AQR Large Cap Multi Style (QCELX ) YTD is up only 1.89%, when AQR Momentum (AMOMX) is up 4.18% and other large value cousins DFA Large Value (DFLVX), Vanguard Large Value (VIVIX) are up 9.45% and 8.68% respectively. AQR Large Cap Multi Stype (QCELX) is supposed to be 40% value and 40% mo...
by QuietProsperity
Tue Oct 18, 2016 12:20 am
Forum: Investing - Theory, News & General
Topic: Worst Bear Market's 16 lost years: What's your risk tolerance, really really?
Replies: 68
Views: 7555

Re: Worst Bear Market's 16 lost years: What's your risk tolerance, really really?

My admittedly uninformed opinion is that the Financial Crisis had the potential to be as bad as the Great Depression, were it not for the swift, inconceivably large, and sustained efforts of world governments. Does anyone have insight into this? I have my confirmation bias ready to go. I am with yo...
by QuietProsperity
Mon Oct 17, 2016 10:54 pm
Forum: Investing - Theory, News & General
Topic: Worst Bear Market's 16 lost years: What's your risk tolerance, really really?
Replies: 68
Views: 7555

Re: Worst Bear Market's 16 lost years: What's your risk tolerance, really really?

I guess how you responded from 2000-2012 is not a bad way to think about it. Although it was not as severe as a drop as the great depression or as slow of a burn of the 66-81 period, the 2000-2012 was not pretty either. VTSMX had a real CAGR of -0.15% for that 12 year period which included two prett...
by QuietProsperity
Mon Oct 10, 2016 11:50 pm
Forum: Investing - Theory, News & General
Topic: Portfolio Visualizer Data Accuracy
Replies: 9
Views: 917

Re: Portfolio Visualizer Data Accuracy

GuitarXM wrote:
Also where do you see the total 10 year percentage return in PV? I can only see monthly percentage returns?


Just did the math real quick...using $10,000 as a starting # makes it pretty easy.
by QuietProsperity
Mon Oct 10, 2016 11:09 pm
Forum: Investing - Theory, News & General
Topic: Portfolio Visualizer Data Accuracy
Replies: 9
Views: 917

Re: Portfolio Visualizer Data Accuracy

Interesting. I decided to use Sept 1st 06 to now and... Total Returns for VTI: Vanguard Site: 106.68% PV: 111.4%% M*: 71.3% Yahoo: 71.23% Funny thing is, I trust the PV number just because its closest to the Vanguard Website #. There was a split back in 08 and I wondering if that is messing up the d...

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