Search found 1417 matches

by Random Walker
Mon Feb 27, 2017 2:16 pm
Forum: Personal Consumer Issues
Topic: Help Please, My Identity is at Risk
Replies: 24
Views: 2502

Re: Help Please, My Identity is at Risk

I've heard that crooks like to hit the same places repeatedly. They got a good look at big stuff they didn't take the first time. Perhaps its alarm time.

Dave
by Random Walker
Mon Feb 27, 2017 10:20 am
Forum: Personal Consumer Issues
Topic: Help Please, My Identity is at Risk
Replies: 24
Views: 2502

Re: Help Please, My Identity is at Risk

So , I transferred from AirPort Time Capsule to the new virgin Mac, and found that encryption was on. Does that mean File Vault encryption must have been turned on in the old computer? I set up the transfer to include both data and settings. Thanks,

Dave
by Random Walker
Mon Feb 27, 2017 10:17 am
Forum: Personal Consumer Issues
Topic: Help Please, My Identity is at Risk
Replies: 24
Views: 2502

Re: Help Please, My Identity is at Risk

Mouses,
You sure got that right! Totally different feel every time I walk in or leave the house! I have two small kids, and I've tried to keep the break in a secret from them.

Dave
by Random Walker
Sun Feb 26, 2017 6:18 pm
Forum: Personal Consumer Issues
Topic: Help Please, My Identity is at Risk
Replies: 24
Views: 2502

Re: Help Please, My Identity is at Risk

Thank you everyone for all the advice. I'm actually not sure if it was encrypted or not. I just bought a new MacBook Air to replace the last one. I set it up by transferring all my old information and settings from Airport Time Capsule. The new laptop seemed to set up with encryption. How does encry...
by Random Walker
Thu Feb 23, 2017 1:55 pm
Forum: Investing - Theory, News & General
Topic: Extreme Valuations, and why you should reconsider
Replies: 215
Views: 12903

Re: Extreme Valuations, and why you should reconsider

I think there is significant difference between pure market timing and comparing where one is financially, where they want to be down the road, current valuations, future expected returns, and possibly adjusting AA on that basis. These are once every 5-10 adjustments perhaps.

Dave
by Random Walker
Wed Feb 22, 2017 10:06 am
Forum: Personal Consumer Issues
Topic: Help Please, My Identity is at Risk
Replies: 24
Views: 2502

Help Please, My Identity is at Risk

Hi all, I know this isn't Investing theory, but this is the most travelled section of the forum and I think I really need help. Two nights ago my home was robbed. Thiefs broke in, they passed on all sorts of stuff: Tvs, video games, game controllers. They took only one thing, my laptop. It has ALL m...
by Random Walker
Tue Feb 21, 2017 7:53 pm
Forum: Investing - Theory, News & General
Topic: Help with standard deviation, volatility comparing slice and dice with 3-fund portfolios
Replies: 9
Views: 363

Re: Help with standard deviation, volatility comparing slice and dice with 3-fund portfolios

1030danielle, You are on to what I believe are a few very important concepts. 1. One can increase portfolio efficiency by diversifying across sources of risk that are weakly, non, negatively correlated. 2. One can minimize fat tails by keeping expected return constant by decreasing overall equity ex...
by Random Walker
Thu Feb 16, 2017 5:42 pm
Forum: Investing - Theory, News & General
Topic: What's a good analogy for average returns?
Replies: 45
Views: 2702

Re: What's a good analogy for average returns?

If you have one foot on burning coals and one foot in an ice bucket, on average your feet are quite comfortable

Dave
by Random Walker
Thu Feb 16, 2017 9:02 am
Forum: Investing - Theory, News & General
Topic: Static AA and the long run?
Replies: 10
Views: 872

Re: Static AA and the long run?

I was 90/10 from 2001-2009 all Boglehead TSM, 80/20 2009-2015 with pretty heavy SV tilt, and now as I'm age 54, perhaps a decade from retirement, with current valuations, am decreasing to 47% equity/35% bonds/18% alternatives. I think in the preretirment years, it's rational to decrease equity in a ...
by Random Walker
Tue Feb 14, 2017 11:12 pm
Forum: Investing - Theory, News & General
Topic: Valuation does not matter (may be)
Replies: 55
Views: 3693

Re: Valuation does not matter (may be)

Larry, When you say "valuations affect one's need to take risk", are you saying that high recent returns resulting in current high valuations result in decreasing one's need to take risk, and conversely that poor recent returns would result in low current valuations, causing one to need to...
by Random Walker
Mon Feb 13, 2017 6:08 pm
Forum: Investing - Theory, News & General
Topic: Please list value funds you currently use
Replies: 62
Views: 4685

Re: Please list value funds you currently use

I'm mostly taxable and use the DFA tax managed and tax advantaged value funds as well as their core funds. The only asset class where the value fund is not tax Managed is their International small value fund.

Dave
by Random Walker
Tue Feb 07, 2017 2:34 pm
Forum: Investing - Theory, News & General
Topic: Fresh Look at the "Larry Portfolio" from Portfolio Charts
Replies: 115
Views: 9913

Re: Fresh Look at the "Larry Portfolio" from Portfolio Charts

Morse Code, I think the Larry Portfolio concept applies at any stage of one's investing lifetime. I think in its broadest terms the Larry concept is simply to use the highest expected returns asset classes for the equity component. The big doses of size and value tilt lead to excellent diversificati...
by Random Walker
Tue Feb 07, 2017 10:33 am
Forum: Investing - Theory, News & General
Topic: Is a total market fund the most diversified
Replies: 157
Views: 13424

Re: Is a total market fund the most diversified

Alchemist, Volatility is a big drag on portfolio returns. The only returns an investor actually experiences are the compounded geometric returns of the portfolio. The simple arithmetic mean portfolio returns are not what we experience. The geometric mean is always less than the simple mean due to vo...
by Random Walker
Tue Feb 07, 2017 10:17 am
Forum: Investing - Theory, News & General
Topic: How steep should the glide path be?
Replies: 54
Views: 4018

Re: How steep should the glide path be?

Svensk anga, Totally agree with you. Bernstein's advice from Ages of Investor: Critical Look at Life Cycle Investing makes total sense to me. I'm 54 now. In 2008 I was 80/20 (60US/40Int), in 2015 went to 70/30, and have now taken some profits, paid tax, and am 47% equities (50US/50Int) /35%bonds / 1...
by Random Walker
Mon Feb 06, 2017 7:37 pm
Forum: Investing - Theory, News & General
Topic: How steep should the glide path be?
Replies: 54
Views: 4018

Re: How steep should the glide path be?

How about personalizing the glide path? We can't control market returns, but we can react to our portfolio's past returns and future expected returns. Maybe after 7 or 8 better than expected years of returns take more off the table than a simple X% per year formula would dictate? As personal circums...
by Random Walker
Sun Feb 05, 2017 1:43 pm
Forum: Investing - Theory, News & General
Topic: Ratio: Pain of Loss v. Happiness of Equal Size Gain
Replies: 22
Views: 1424

Re: Ratio: Pain of Loss v. Happiness of Equal Size Gain

Drzzzzz, Totally agree! I think that many of us should be grateful for the last 7-8 years, look at our portfolios, our personal circumstance, equity valuations, expected returns, dispersion of potential future outcomes, and consider taking a profit, paying some capital gains tax, and taking some ris...
by Random Walker
Sun Feb 05, 2017 1:32 pm
Forum: Investing - Theory, News & General
Topic: Fresh Look at the "Larry Portfolio" from Portfolio Charts
Replies: 115
Views: 9913

Re: Fresh Look at the "Larry Portfolio" from Portfolio Charts

Garlandwhizzer, Low interest rates make future bond returns look poor and current equity valuations make expected equity returns look modest as well. That's why it may be prudent to consider diversifying across other potential sources of return such as the alternatives Larry has mentioned recently: ...
by Random Walker
Sun Feb 05, 2017 12:37 am
Forum: Investing - Theory, News & General
Topic: Why go with an 80% stock / 20% bond portfolio?
Replies: 328
Views: 17724

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

I agree with pretty much everything you're saying. That being said, I think there is great value for a young investor to have modest 10-20% bonds for the sake of developing the behavioral discipline to rebalance.

Dave
by Random Walker
Sat Feb 04, 2017 2:59 pm
Forum: Investing - Theory, News & General
Topic: Ratio: Pain of Loss v. Happiness of Equal Size Gain
Replies: 22
Views: 1424

Re: Ratio: Pain of Loss v. Happiness of Equal Size Gain

When popular risk perception is low, I bet the market has good gains, future expected returns are lower, and potential downside is big. When popular risk perception is high, I bet the market has already seen substantial losses, future expected returns are higher, and dispersion of potential future r...
by Random Walker
Sat Feb 04, 2017 10:12 am
Forum: Investing - Theory, News & General
Topic: Ratio: Pain of Loss v. Happiness of Equal Size Gain
Replies: 22
Views: 1424

Re: Ratio: Pain of Loss v. Happiness of Equal Size Gain

Live soft,
Think I know what you're talking about. If my portfolio tanks on a bad day, but one asset class eeks out a small gain, it puts a smile on my face :-)

Dave
by Random Walker
Sat Feb 04, 2017 10:10 am
Forum: Investing - Theory, News & General
Topic: Ratio: Pain of Loss v. Happiness of Equal Size Gain
Replies: 22
Views: 1424

Re: Ratio: Pain of Loss v. Happiness of Equal Size Gain

Sport,
It's a mind experiment. Start by imagining your portfolio being cut in half over night versus doubling. Then start imagining different size losses to different size gains and see how the stomach and mind feel.

Dave
by Random Walker
Sat Feb 04, 2017 10:07 am
Forum: Investing - Theory, News & General
Topic: Maintaining Asset Allocation when Value Averaging
Replies: 7
Views: 385

Re: Maintaining Asset Allocation when Value Averaging

The expected return of equities, while sometimes higher and sometimes lower, is always positive. So for the long run, probably best to just put the money all in up front. If one maintains a fixed AA and dollar cost averages into it, then he is sort of "dollar cost averaging on steroids" si...
by Random Walker
Sat Feb 04, 2017 9:53 am
Forum: Investing - Theory, News & General
Topic: Ratio: Pain of Loss v. Happiness of Equal Size Gain
Replies: 22
Views: 1424

Ratio: Pain of Loss v. Happiness of Equal Size Gain

A lot of us have read that behavioral finance has shown that the pain of loss is 2X the happiness derived from a gain of equal size. This 2:1 ratio probably gets larger as we get older for many reasons: the absolute dollar losses are greater, capacity to recover from loss less, settled in a certain ...
by Random Walker
Fri Feb 03, 2017 3:31 pm
Forum: Investing - Theory, News & General
Topic: Risk tolerance when you meet your number
Replies: 106
Views: 9727

Re: Risk tolerance when you meet your number

By the way, the party line from behavioral finance is that a loss is twice as painful as the happiness of an equal sized gain. But I think it's fair to say that the ratio increases fast as net worth increases!

Dave
by Random Walker
Fri Feb 03, 2017 3:12 pm
Forum: Investing - Theory, News & General
Topic: Factor-Diversified Portfolio
Replies: 175
Views: 14226

Re: Factor-Diversified Portfolio

Beta blocker, How about QSPIX, the AQR style premia fund, instead of or in addition to QMHIX, the AQR Managed Futures fund. The style premia fund invests in 4 styles across I think 4 asset classes. The styles are value, CS Momentum, carry, defensive. The asset classes are equities, bonds, currencies...
by Random Walker
Fri Feb 03, 2017 2:35 pm
Forum: Investing - Theory, News & General
Topic: Allocation/Diversification of Equities During Withdrawal Phase
Replies: 10
Views: 860

Re: Allocation/Diversification of Equities During Withdrawal Phase

If your really looking for factor diversification / non correlated assets, you could go the AQR Style Premia Fund, AQR Time Series Momentum Fund, deep SV tilt US & Int, Alternative Lending LENDX, Reinsurrance SRRIX, high quality bonds route

Dave
by Random Walker
Fri Feb 03, 2017 2:28 pm
Forum: Investing - Theory, News & General
Topic: Risk tolerance when you meet your number
Replies: 106
Views: 9727

Re: Risk tolerance when you meet your number

Sand trap, I agree with you. Age in bonds is a good starting point. But as we age the differences between individual's personal circumstances get more and more pronounced and that rough rule becomes less likely to be helpful. What really matters is where you are financially and where you want to go....
by Random Walker
Fri Feb 03, 2017 9:50 am
Forum: Investing - Theory, News & General
Topic: Allocation/Diversification of Equities During Withdrawal Phase
Replies: 10
Views: 860

Re: Allocation/Diversification of Equities During Withdrawal Phase

I think equities should be diversified widely across factors at any stage of the investing life cycle. As you say, any one of the factors can underperform for long periods. So the big question is the right amount of fixed income for you at any given stage. It seems antiintuitive, but because any fac...
by Random Walker
Mon Jan 30, 2017 7:44 pm
Forum: Investing - Theory, News & General
Topic: Risk tolerance when you meet your number
Replies: 106
Views: 9727

Re: Risk tolerance when you meet your number

Big John,
I really am right behind you :-) I had envisioned a 60/40 retirement for the duration as well, but am cooling off the AA more than I had anticipated

Dave
by Random Walker
Mon Jan 30, 2017 3:44 pm
Forum: Investing - Theory, News & General
Topic: Risk tolerance when you meet your number
Replies: 106
Views: 9727

Re: Risk tolerance when you meet your number

Big John, You and I are on the same page. I think that the potential dispersion of equity outcomes over next decade doesn't really favor a high equity allocation for someone approaching retirement. I'm 54, and in the last year I've cooled off my equity allocation from 70% to 47%. Also went from 60% ...
by Random Walker
Mon Jan 30, 2017 11:47 am
Forum: Investing - Theory, News & General
Topic: Disappearing premiums!
Replies: 157
Views: 20094

Re: Disappearing premiums!

Helps a lot! :-) thanks

Dave
by Random Walker
Mon Jan 30, 2017 10:10 am
Forum: Investing - Theory, News & General
Topic: Risk tolerance when you meet your number
Replies: 106
Views: 9727

Re: Risk tolerance when you meet your number

Just reread William Bernstein's very short e-book, The Ages of the Investor: A Critical Look at Life-Cycle Investing. Strongly recommend it. Given current valuations, the last 5 pages or so are very pertinent to this discussion.

Dave
by Random Walker
Mon Jan 30, 2017 10:05 am
Forum: Investing - Theory, News & General
Topic: Disappearing premiums!
Replies: 157
Views: 20094

Re: Disappearing premiums!

Is it fair to say though that it's reasonable to have these tax inefficient alternatives (QSPIX, QMHRX, SSRIX, LENDX) in a taxable account if one is adding them as an alternative to municipal bonds? If one is adding them by taking from the bond side, he is trying to increase risk, increase expected ...
by Random Walker
Sun Jan 29, 2017 8:51 pm
Forum: Investing - Theory, News & General
Topic: "Risk-Adjusted Return"
Replies: 18
Views: 1131

Re: "Risk-Adjusted Return"

Nisiprius, I think we are in general agreement. I didn't quite understand the Sharpe ratio fraction thing though. Your point is well taken though. In your example, the Latin America fund simply didn't have enough return, which of course is part of the Sharpe ratio numerator. So yes I agree, for an i...
by Random Walker
Sun Jan 29, 2017 6:22 pm
Forum: Investing - Theory, News & General
Topic: "Risk-Adjusted Return"
Replies: 18
Views: 1131

Re: "Risk-Adjusted Return"

I think Sharpe ratio of a potential portfolio addition in isolation is almost meaningless. What really matters is how the potential portfolio addition affects the Sharpe ratio of the portfolio as a whole. The variables that matter when considering the addition of a new component to a portfolio are e...
by Random Walker
Sun Jan 29, 2017 12:19 pm
Forum: Investing - Theory, News & General
Topic: "Risk-Adjusted Return"
Replies: 18
Views: 1131

Re: "Risk-Adjusted Return"

Hi Kosomoto, I agree with you. I've read that in theory all asset classes should have the same Sharpe ratio. That doesn't make sense to me. I could see theory stating that the ratio of return to "risk" would be the same for different asset classes, but "risk" has so many potentia...
by Random Walker
Fri Jan 27, 2017 8:14 pm
Forum: Investing - Theory, News & General
Topic: Risk tolerance when you meet your number
Replies: 106
Views: 9727

Re: Risk tolerance when you meet your number

Marcopolo, That's why I wouldn't call this market timing. It's more once or twice in a lifetime decisions. The fall back is always to rebalance to one's predetermined plan or adjust AA according to predetermined glidepath. But say one were way ahead of where they thought they'd be in 1999, he would ...
by Random Walker
Fri Jan 27, 2017 12:28 pm
Forum: Investing - Theory, News & General
Topic: Risk tolerance when you meet your number
Replies: 106
Views: 9727

Re: Risk tolerance when you meet your number

Marcopolo, I wouldn't really call it market timing. It's sort of long range planning. I think an individual can do better than a predetermined AA glide path by periodically (once or twice a decade) looking at his life circumstances, his portfolio, market valuations and expected returns, and adjustin...
by Random Walker
Fri Jan 27, 2017 10:54 am
Forum: Investing - Theory, News & General
Topic: Asset Allocation - considering a change
Replies: 18
Views: 1557

Re: Asset Allocation - considering a change

I would go the other direction and consider taking some risk off the table! See my post today in the thread regarding "when you've reached your number"

Dave
by Random Walker
Fri Jan 27, 2017 10:51 am
Forum: Investing - Theory, News & General
Topic: Part 3 of lessons the markets taught in 2016
Replies: 5
Views: 650

Re: Part 3 of lessons the markets taught in 2016

I realize that funds like AQR Style Premia and AQR Managed Futures are pretty much formulaic and passive. But is it fair to say that to some extent they share some hedge fund like qualities? Their expenses are certainly very high for passive funds. Would it be more appropriate to see the effect of a...
by Random Walker
Fri Jan 27, 2017 10:44 am
Forum: Investing - Theory, News & General
Topic: Part 3 of lessons the markets taught in 2016
Replies: 5
Views: 650

Re: Part 3 of lessons the markets taught in 2016

"For the 10-year period, an all-equity portfolio allocated 50% internationally and 50% domestically, again equally weighted in the asset classes within those broad categories, would have returned 4.1% per year. A 60% equity and 40% bond portfolio with the same weights for the equity allocation ...
by Random Walker
Fri Jan 27, 2017 10:29 am
Forum: Investing - Theory, News & General
Topic: Risk tolerance when you meet your number
Replies: 106
Views: 9727

Re: Risk tolerance when you meet your number

Ryman554, I disagree with you. The stock market is crazy. Historically it's had a return of something like 8% with an SD of like 20%! We have control of very little. But one thing we have control over is responding to where we are in our own personal life cycle of investing compared to how the marke...
by Random Walker
Thu Jan 26, 2017 10:34 pm
Forum: Investing - Theory, News & General
Topic: Simple vs. Compound Return
Replies: 11
Views: 2166

Re: Simple vs. Compound Return

Why3not, The three fund portfolio basically has exposure to the market factor on the equity side and term factor and credit factor on the bond side. Yes it does obtain geographic diversification by having TSM and TISM. BUT TSM, although having lots of equities, has no net exposure to drivers of retu...
by Random Walker
Thu Jan 26, 2017 6:11 am
Forum: Investing - Theory, News & General
Topic: Simple vs. Compound Return
Replies: 11
Views: 2166

Re: Simple vs. Compound Return

Danielle, I agree that past performance alone is not a reason to invest in for example SV. Need intuitive risk based or behavioral reason for Factor to occur in future as well. More importantly though, if one cannot know if a certain source of return will provide a premium or underperform in the fut...
by Random Walker
Wed Jan 25, 2017 6:46 pm
Forum: Investing - Theory, News & General
Topic: Curious for Opinions on Intra vs Inter Portfolio Allocation
Replies: 2
Views: 261

Re: Curious for Opinions on Intra vs Inter Portfolio Allocation

I think it is best to take a top - down approach; treat all your accounts as one whole. Decide what asset allocation you want, possibly fine tune it according to how much space is taxable versus tax deferred, put the least tax efficient investments in the tax deferred space. Perhaps choose specific ...
by Random Walker
Tue Jan 24, 2017 11:46 am
Forum: Investing - Theory, News & General
Topic: Bogle: Smart Beta does not deliver Better Returns
Replies: 35
Views: 3404

Re: Bogle: Smart Beta does not deliver Better Returns

Nisiprius, I disagree with you on two points. First I don't believe that Larry would take credit for finding a holy grail. He's simply describing independent factors that academics have found to drive returns and stating that it makes a lot of sense to diversify across them. Secondly, there are big ...
by Random Walker
Tue Jan 24, 2017 11:31 am
Forum: Investing - Theory, News & General
Topic: Simple vs. Compound Return
Replies: 11
Views: 2166

Re: Simple vs. Compound Return

Hi Danielle, Thanks for bringing this subject into the spotlight. I first learned of it from Ferri's Asset Allocation book. Roger Gibson's Asset Allocation goes into some depth on the subject. Ive posted on this a couple times in the past. If you're interested look up "multiple asset class inve...
by Random Walker
Tue Jan 24, 2017 10:33 am
Forum: Investing - Theory, News & General
Topic: Factor-Diversified Portfolio
Replies: 175
Views: 14226

Re: Factor-Diversified Portfolio

I've read that TS Momentum has tended to perform well in bear markets. Anyone know how this performance has compared to high quality bonds?

Dave
by Random Walker
Tue Jan 24, 2017 10:30 am
Forum: Investing - Theory, News & General
Topic: Rewards of Multiple Asset Class Investing
Replies: 11
Views: 1326

Re: Rewards of Multiple Asset Class Investing

Tyler9000, Great addition. Some serious work went into that chart. I like the idea of plotting risk as "worst yrpear since 1972". There are multiple ways to define risk and I think looking at SD alone doesn't give a full sense at all of what risk really is. In your chart the promised land ...
by Random Walker
Tue Jan 24, 2017 12:26 am
Forum: Investing - Theory, News & General
Topic: Rewards of Multiple Asset Class Investing
Replies: 11
Views: 1326

Re: Rewards of Multiple Asset Class Investing

People speak of tilting as taking on additional risk. I think of it more as diversifying across types of risk; or more accurately diversifying across different sources of return. For me it is a small leap to extrapolate from the 4 asset classes in the above diagram to multiple factors instead of sin...

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