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by Rick Ferri
Sun Feb 07, 2016 3:19 pm
Forum: Investing - Theory, News & General
Topic: Rick Ferri looking to internationalize his portfolio
Replies: 464
Views: 95254

Re: Rick Ferri looking to internationalize his portfolio

In your blog, the topic of this thread, you say: Currently, 70% of my stock allocation is in US equity and 100% of my bond allocation is in US bonds. Sometime in 2015, I may shift my portfolio to a more global stock and bond allocation. But now you are making a general argument against shifting to ...
by Rick Ferri
Thu Feb 04, 2016 10:52 am
Forum: Investing - Theory, News & General
Topic: Rick Ferri looking to internationalize his portfolio
Replies: 464
Views: 95254

Re: Rick Ferri looking to internationalize his portfolio

I slightly negative on the idea of foreign bonds. I look to fixed income for yield and portfolio stability. From that perspective, there's no advantage to paying more in fees for hedged international bond funds that yield less than US bonds. The slight diversification benefit of owning foreign bonds...
by Rick Ferri
Wed Feb 03, 2016 10:16 pm
Forum: Investing - Theory, News & General
Topic: Rick Ferri looking to internationalize his portfolio
Replies: 464
Views: 95254

Re: Rick Ferri looking to internationalize his portfolio

Thanks for the question. I don't recommend going overboard on emerging markets. China and Tiawan make up over 40% of the EM index, so an EM index fund it's really a large bet on those markets. My suggestion is no more than 20% of your international equity exposure In EM.

Rick Ferri
by Rick Ferri
Thu Jan 07, 2016 8:20 pm
Forum: Investing - Theory, News & General
Topic: The S&P 500 had a great year for foreign investors.
Replies: 20
Views: 2553

Re: The S&P 500 had a great year for foreign investors.

This has nothing to do with the S&P500. You would have achieved similar gains just leaving it in a US dollar bank account. Yes, that is quite obvious. But US investors jump for joy over good foreign stock returns even when the return is due only to a weak US dollar. Currency diversification hel...
by Rick Ferri
Wed Jan 06, 2016 10:27 pm
Forum: Investing - Theory, News & General
Topic: The S&P 500 had a great year for foreign investors.
Replies: 20
Views: 2553

The S&P 500 had a great year for foreign investors.

US investors saw slight gains from the total return of the S&P 500 last year, but Canadians realized over 21% due to currencies changes. Craig Lazzara, Global Head of Index Investment Strategy at S&P Dow Jones Indices provides the data: The S&P 500’s Flat Year

Rick Ferri
by Rick Ferri
Tue Jan 05, 2016 6:14 pm
Forum: Investing - Theory, News & General
Topic: VWO: what a terrible performance!!
Replies: 79
Views: 7559

Re: VWO: what a terrible performance!!

Often when you feel this way and are about to give up the market near a bottom. :wink:
by Rick Ferri
Tue Jan 05, 2016 6:05 pm
Forum: Personal Consumer Issues
Topic: The Big Short
Replies: 137
Views: 13801

Re: Just watched "The Big Short". Clueless the investment banks

It's Hollywood insight. The individual mortgages were not AAA. Repackaging large blocks of sub-prime mortgages into tranches create pieces that were rated AAA. Also, it not investment bankers who do the rating. It's rating companies that are paid to rate. That's where the crime was committed. Finall...
by Rick Ferri
Sun Jan 03, 2016 9:18 am
Forum: Investing - Theory, News & General
Topic: Rick Ferri looking to internationalize his portfolio
Replies: 464
Views: 95254

Re: Rick Ferri looking to internationalize his portfolio

Please accept my apologies. We are working on RickFerri.com. In the mean time, all of my blogs are available on Forbes.com. Here is the link: http://www.forbes.com/sites/rickferri/ The article on my decision to increase international equity exposure can be found here: My Expected Investment Changes ...
by Rick Ferri
Sun Jan 03, 2016 9:11 am
Forum: Investing - Theory, News & General
Topic: Rick Ferri's Blog
Replies: 10
Views: 1800

Re: Rick Ferri's Blog

Please accept my apologies. We are addressing RickFerri.com. In the mean time, all of my blogs are available on Forbes.com. Here is the link: http://www.forbes.com/sites/rickferri/ The article on my decision to increase international equity exposure can be found here: My Expected Investment Changes ...
by Rick Ferri
Fri Jan 01, 2016 6:16 pm
Forum: Investing - Theory, News & General
Topic: REGISTRATION FOR THE 2016 BOGLEHEAD CONTEST
Replies: 646
Views: 14483

Re: REGISTRATION FOR THE 2016 BOGLEHEAD CONTEST

Every year I make the same go-big-or-go-home guess of up 20%.

2452.73

Note: There is absolutely no science or logic behind this guess.

Rick Ferri
by Rick Ferri
Sun Dec 27, 2015 4:58 pm
Forum: Investing - Theory, News & General
Topic: Has the Asset Allocation of Bogleheads changed?
Replies: 2
Views: 658

Re: Has the Asset Allocation of Bogleheads changed?

Dale,

This is a good thing. The lessons of a long-term asset allocation only work if we remain long-term. Your analysis shows it's working.

Thanks!
Rick Ferri
by Rick Ferri
Wed Dec 02, 2015 6:23 pm
Forum: Investing - Theory, News & General
Topic: Great Rick Ferri Interview
Replies: 8
Views: 2767

Re: Great Rick Ferri Interview

Thanks for posting this interview. I enjoyed talking with Jousha. He is a bright and talented young man whose primary interest is uncovering truths that help others. My kind of guy! There is another thread going on discussing my 100% allocation to equity. I don't say a whole lot more in that thread ...
by Rick Ferri
Wed Dec 02, 2015 6:15 pm
Forum: Investing - Theory, News & General
Topic: Rick Ferri's Portfolio
Replies: 197
Views: 65128

Re: Rick Ferri's Portfolio

All things equal, I wonder if Rick will stay at 100% equities into retirement. In other words, when he reaches age 69 and beyond (I turn 69 next week so I am interested)? I would think so. When you only need the dividend income from stocks, owning stocks becomes a lot less emotional. Dividends do g...
by Rick Ferri
Wed Dec 02, 2015 9:18 am
Forum: Investing - Theory, News & General
Topic: Rick Ferri's Portfolio
Replies: 197
Views: 65128

Re: Rick Ferri's Portfolio

I went to 100% equity in my retirement savings a few years ago after I calculated that all the income I need at age 67 should be covered by my military pension, Social Security, two small corporate pensions, and 2% dividends on savings.

I'll let you know if anything changes.

Rick Ferri
by Rick Ferri
Tue Nov 10, 2015 1:39 pm
Forum: Local Chapters and Bogleheads Community
Topic: US Marine Corps' 240th Birthday [also, Armistice Day]
Replies: 25
Views: 2126

Re: US Marine Corps' 240th Birthday

Semper Fi, Brothers.

Rick Ferri
USMC (1980-2000)
by Rick Ferri
Sun Oct 18, 2015 5:46 pm
Forum: Investing - Theory, News & General
Topic: White Coat Investor critiques a David Ramsey rant on Bogle
Replies: 24
Views: 6324

Re: White Coat Investor critiques a David Ramsey rant on Bogle

The stance he [Bogle] has made is that you should only buy no-loads and that you should only buy S&P index funds. There is plenty of mathematical evidence to counter that….I get so wired up about Bogle and those guys because they cause people to get paralysis by analysis. This simply isn't true...
by Rick Ferri
Sat Oct 17, 2015 2:46 pm
Forum: Investing - Theory, News & General
Topic: Eliminate International?
Replies: 78
Views: 5718

Re: Eliminate International?

I agree! :D

Rick Ferri
by Rick Ferri
Sat Oct 17, 2015 12:32 pm
Forum: Investing - Theory, News & General
Topic: Eliminate International?
Replies: 78
Views: 5718

Re: Eliminate International?

One last question what percentage of my stock holdings should be devoted to international? OK, let's step back and look at the three legs on a successful index investing stool. They are philosophy, strategy and discipline . Philosophy is your belief about how to achieve the returns you need to make...
by Rick Ferri
Sat Oct 17, 2015 11:49 am
Forum: Investing - Theory, News & General
Topic: Eliminate International?
Replies: 78
Views: 5718

Re: Eliminate International?

I do not use any international bond funds or currency hedged equity funds.

Rick Ferri
by Rick Ferri
Sat Oct 17, 2015 11:46 am
Forum: Investing - Theory, News & General
Topic: Eliminate International?
Replies: 78
Views: 5718

Re: Eliminate International?

I wrote about this a couple of months ago: Should You Own Foreign Stocks? Bottom line, currency diversification helps and having more stocks is better than having less stocks. So I'm on the side of owning foreign.

Rick Ferri
by Rick Ferri
Tue Oct 06, 2015 3:56 pm
Forum: Investing - Theory, News & General
Topic: Six Rules to Disciplined Investing
Replies: 19
Views: 3713

Six Rules to Disciplined Investing

Discipline is the key that allows and investment plan to work for you. I’ve put together six rules to disciplined investing. They will help you make better long-term decisions: 1) Have a long-term investment philosophy. 2) Form a prudent asset allocation based on this philosophy. 3) Select low-cost ...
by Rick Ferri
Mon Oct 05, 2015 12:57 pm
Forum: Investing - Theory, News & General
Topic: To ETF or Not to ETF
Replies: 92
Views: 40719

Re: To ETF or Not to ETF

Why pay any ETF spread? Just by Admiral shares. There are a few exceptions for Vanguard funds that have purchase or redemption fees. For those use ETFs.

Rick Ferri
by Rick Ferri
Mon Oct 05, 2015 12:08 pm
Forum: Investing - Theory, News & General
Topic: A meeting with Jack Bogle
Replies: 30
Views: 3448

Re: A meeting with Jack Bogle

Thanks for the warm and wonderful story, Taylor.

Rick Ferri
by Rick Ferri
Mon Oct 05, 2015 11:52 am
Forum: Investing - Theory, News & General
Topic: The Power of Passive Investing Now
Replies: 1
Views: 885

The Power of Passive Investing Now

Here is a recent interview I did with S&P Dow Jones' Shaun Wurzbach. We cover passive, low-cost investing, SPIVA data, advisers adopting indexing outside the US, robo advisors and other topics.

The Power of Passive Investing Now

Rick Ferri
Bogleheads' unite next week!
by Rick Ferri
Wed Sep 30, 2015 7:30 am
Forum: Investing - Theory, News & General
Topic: value underperforms last 8 years
Replies: 24
Views: 2874

Re: value underperforms last 8 years

Value underperformed for 18 years from 1983 to 2001.

Rick Ferri
by Rick Ferri
Wed Sep 30, 2015 7:24 am
Forum: Investing - Theory, News & General
Topic: Goldman Sachs Spin - Active vs. Passive
Replies: 24
Views: 2038

Re: Goldman Sachs Spin - Active vs. Passive

That's the theory. The only thing lacking is evidence. Trillions of dollars directly benchmark to the S&P 500, yet the dispersion of individual stock returns is the same as it has been for 50 years.

Rick
by Rick Ferri
Wed Sep 23, 2015 10:26 am
Forum: Investing - Theory, News & General
Topic: Simple explanation of rebalancing
Replies: 6
Views: 1054

Re: Simple explanation of rebalancing

It's simple a matter of convenience. Quarterly contributions allow you to buy more shares in an asset class that needs a contribution. Doing it once a month seems cumbersome. That's all I was getting at. Thanks for asking.

Rick Ferri
by Rick Ferri
Fri Sep 18, 2015 2:19 pm
Forum: Investing - Theory, News & General
Topic: Simple explanation of rebalancing
Replies: 6
Views: 1054

Simple explanation of rebalancing

In the market’s never-ending story, we never know how its most recent action will play out. One thing we do know is that when the market is more volatile than usual, investors who lack a personalized, long-term plan to guide their way are far more likely to make the wrong moves by the time the cycle...
by Rick Ferri
Tue Sep 08, 2015 1:52 pm
Forum: Investing - Theory, News & General
Topic: Lump Sum Guide
Replies: 11
Views: 1458

Re: Lump Sum Guide

From the article: Was this money from an employer pension plan? If the answer is yes, then the cash was most likely recently invested in stock and bond investments, which means it probably is best invested right back into the same. For example, if your 401(k) was recently invested in stock and bond...
by Rick Ferri
Tue Sep 08, 2015 12:40 pm
Forum: Investing - Theory, News & General
Topic: Lump Sum Guide
Replies: 11
Views: 1458

Re: Lump Sum Guide

Leeraar wrote:Rick,

Perhaps a caution is in order: If these funds are tax-advantaged, be careful to make the transfer properly. You don't want to have tax withheld if it is paid to you, and you have a restricted period of time to get it into another plan.

L.


Good point. :thumbsup

Rick Ferri
by Rick Ferri
Tue Sep 08, 2015 11:44 am
Forum: Investing - Theory, News & General
Topic: Lump Sum Guide
Replies: 11
Views: 1458

Lump Sum Guide

Receiving a lump-sum distribution can be liberating and daunting at the same time. What do you do with the cash? How should you invest it? Should you invest all at once or dollar-cost-averaging (DCA)? I wrote down a few questions to make these decisions easier. In 6 Things To Consider When Investing...
by Rick Ferri
Wed Sep 02, 2015 6:30 am
Forum: Investing - Theory, News & General
Topic: Having fun on CNBC Halftime Report today
Replies: 19
Views: 2839

Re: Having fun on CNBC Halftime Report today

I really don't think being a money manager or financial adviser makes you qualified to talk about macroeconomic policy.


Do you think we should leave the conversation to our elected officials? :D

Rick Ferri
by Rick Ferri
Tue Sep 01, 2015 5:09 pm
Forum: Investing - Theory, News & General
Topic: A “Crazy Like a Fox” Idea for Managing Market Uncertainty
Replies: 8
Views: 1857

A “Crazy Like a Fox” Idea for Managing Market Uncertainty

What are you doing in this market environment? I’ve been asked this question thousands of times, in all market environments. It’s a difficult question because it’s natural to want to do something useful today in preparation for what is to come tomorrow. But today’s market environment may not be tom...
by Rick Ferri
Fri Aug 28, 2015 9:00 pm
Forum: Investing - Theory, News & General
Topic: Having fun on CNBC Halftime Report today
Replies: 19
Views: 2839

Re: Having fun on CNBC Halftime Report today

Kalo wrote:What about the fact that a further strengthening dollar (which we would expect from a rate increase while the rest of the world is decreasing rates) hurts US exports?

Kalo


Could be. It could also be that domestic demand increases more and overshadows a small drop in foreign exports.

Rick Ferri
by Rick Ferri
Fri Aug 28, 2015 8:04 pm
Forum: Investing - Theory, News & General
Topic: Having fun on CNBC Halftime Report today
Replies: 19
Views: 2839

Having fun on CNBC Halftime Report today

I was a guest on the CNBC Halftime Report today. We talked about why a Fed rate hike isn't such a bad thing.

Here is the 5 minute video link: Embracing Rising Rates

Rick Ferri
by Rick Ferri
Wed Aug 26, 2015 5:19 pm
Forum: Investing - Theory, News & General
Topic: S & P 500's Global Sales
Replies: 13
Views: 1264

Re: S & P 500's Global Sales

More data on what this thread is about:

Should You Own Foreign Stocks?

Rick Ferri
by Rick Ferri
Wed Aug 26, 2015 5:17 pm
Forum: Investing - Theory, News & General
Topic: Rick Ferri looking to internationalize his portfolio
Replies: 464
Views: 95254

Re: Rick Ferri looking to internationalize his portfolio

sergeant wrote:
Rick Ferri wrote:We're almost there.

Rick Ferri

Are we there yet?


Not yet. Maybe later this year. I'm in no hurry.

Rick Ferri
by Rick Ferri
Tue Aug 25, 2015 5:17 pm
Forum: Investing - Theory, News & General
Topic: Messy Fund Managers Create an Illusion of Skill
Replies: 8
Views: 975

Re: Messy Fund Managers Create an Illusion of Skill

Whether or not it is "messy" may just be an opinion based on the frame of reference for the person looking at the portfolio (who may not understand it). Academics focused on the idea that the market is "Efficient" don't have methodologies to look at a portfolio that may require ...
by Rick Ferri
Tue Aug 25, 2015 5:13 pm
Forum: Investing - Theory, News & General
Topic: What to do in this market environment
Replies: 3
Views: 1519

Re: What to do in this market environment

Only if you're sure the market isn't going down further in the next market environment.

Rick Ferri
by Rick Ferri
Tue Aug 25, 2015 2:22 pm
Forum: Investing - Theory, News & General
Topic: Messy Fund Managers Create an Illusion of Skill
Replies: 8
Views: 975

Re: Messy Fund Managers Create an Illusion of Skill

The fair way to rank managers is by using a 3- or 5-factor model. This takes out the strategy biases of manager. Unfortunately, Morningstar doesn't report 3- and 5- factor rankings (it is available at the institutional level I am told). Retail investors are stuck with style box comparisons and peer ...
by Rick Ferri
Tue Aug 25, 2015 2:17 pm
Forum: Investing - Theory, News & General
Topic: Messy Fund Managers Create an Illusion of Skill
Replies: 8
Views: 975

Re: Messy Fund Managers Create an Illusion of Skill

I would not describe a fund manager who does not stay in a particular size/value-vs-growth style box as "messy", unless the fund is mandated to do so. If you are going to hire an active manager, it is reasonable to give him discretion to buy the stocks that he thinks have the highest expe...
by Rick Ferri
Tue Aug 25, 2015 2:06 pm
Forum: Investing - Theory, News & General
Topic: What to do in this market environment
Replies: 3
Views: 1519

What to do in this market environment

"Rick, what are you doing in this market environment?” I’ve been asked this question thousands of times and still don’t know what people are asking. Are they expecting me to forecast the market, give advice on stocks or bonds, or are they asking what I'm doing this weekend? I can answer the las...
by Rick Ferri
Tue Aug 25, 2015 10:50 am
Forum: Investing - Theory, News & General
Topic: Messy Fund Managers Create an Illusion of Skill
Replies: 8
Views: 975

Messy Fund Managers Create an Illusion of Skill

Mutual fund rating services divide mutual funds into categories based on their investment style. This helps investors compare the performance of one style to another and helps them compare the performance of individual funds in a particular style. While useful in many ways, this methodology can also...
by Rick Ferri
Fri Aug 21, 2015 4:00 pm
Forum: Investing - Theory, News & General
Topic: Tips on answering the question - What Should I Do?
Replies: 163
Views: 215076

Re: Tips on answering the question - What Should I Do?

There is some equity risk in corporate bond returns at times, and if you feel uncomfortable with that, you might want to own more government backed bonds. My view is to be diversified. It's OK to accept the higher risk of corporate bonds because we're paid for it, but also have government bonds. Tha...
by Rick Ferri
Wed Aug 19, 2015 1:31 pm
Forum: Investing - Theory, News & General
Topic: A deeper look at gold. What's the "right" price?
Replies: 45
Views: 3318

Re: A deeper look at gold. What's the "right" price?

Yeah. Let it hit $500, then wait another 10 years and your timing will be good.

Rick

PS. People are now predicting oil will go down to $15-$20 per barrel - so we must be near a bottom at $40.
by Rick Ferri
Wed Aug 19, 2015 1:27 pm
Forum: Investing - Theory, News & General
Topic: A deeper look at gold. What's the "right" price?
Replies: 45
Views: 3318

Re: A deeper look at gold. What's the "right" price?

The right price for gold is around $500 per ounce, give or take $100. This is the inflation-adjusted value going back about 3,000 years. Many times in history, gold has tripled in value, only to fall back to it's inflation-adjusted price over the next decade or so.

Rick Ferri
by Rick Ferri
Tue Aug 18, 2015 4:30 pm
Forum: Investing - Theory, News & General
Topic: Should you own foreign stocks?
Replies: 67
Views: 4681

Re: Should you own foreign stocks?

There is a portfolio benefit to re-balancing currencies to a fixed US/International allocation over time.

Rick Ferri
by Rick Ferri
Tue Aug 18, 2015 4:20 pm
Forum: Investing - Theory, News & General
Topic: Should you own foreign stocks?
Replies: 67
Views: 4681

Re: Should you own foreign stocks?

I prefer un-hedged equity funds because I want the currency diversification.

Rick Ferri
by Rick Ferri
Tue Aug 18, 2015 9:14 am
Forum: Investing - Theory, News & General
Topic: Should you own foreign stocks?
Replies: 67
Views: 4681

Re: Should you own foreign stocks?

Currently, it is 30%, but I plan to increase this to 40% at some time given the greater globalization in the equity markets (The US market is currently 52% of global equity). See this post. I do not know when I'll actually make this move. Perhaps by the end of 2015, or maybe in early 2016. Taxes are...

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