Search found 1436 matches

by Theoretical
Thu Dec 06, 2018 10:52 pm
Forum: Investing - Theory, News & General
Topic: (NEW) WisdomTree 90/60 U.S. Balanced Fund
Replies: 172
Views: 12283

Re: (NEW) WisdomTree 90/60 U.S. Balanced Fund

This fund is not complicated and is potentially very useful to investors who want a portfolio a little more sophisticated than a straight market-cap weighted approach. Bogleheads: “Simplicity is the ultimate sophistication.” -- Leonardo da Vinci In my opinion, and more importantly, in the opinion o...
by Theoretical
Thu Dec 06, 2018 5:16 pm
Forum: Investing - Theory, News & General
Topic: Preferred stock vs. cd vs. common
Replies: 4
Views: 355

Re: Preferred stock vs. cd vs. common

Preferred stocks get you the limited upside of bonds without the significant debtor covenants. If you strictly want income, I'd strongly prefer junk bonds over preferreds, all things being equal, especially the fallen angel types that have more covenants.
by Theoretical
Thu Dec 06, 2018 5:05 pm
Forum: Investing - Theory, News & General
Topic: Why are market corrections "healthy"?
Replies: 27
Views: 2006

Re: Why are market corrections "healthy"?

It boils down to the fact that negative/downside volatility is ultimately healthy for a robust system, and especially to keep the market from getting hyper-overleveraged. I'm very Taleb-ian on these sorts of things, but if you don't take risk, high returns are suspect and you might just be a sucker....
by Theoretical
Wed Dec 05, 2018 1:19 pm
Forum: Investing - Theory, News & General
Topic: Any thoughts about defined outcome ETFs?
Replies: 11
Views: 713

Re: Any thoughts about defined outcome ETFs?

Any thoughts about so-called Defined Outcome ETFs that are tied to a particular index and designed to shield investors from drops up to a specified amount in that index, with capped upside returns should the index go up. Three examples: Innovator S&P Buffer (BJUL), Innovator S&P Power Buffer (PJUL)...
by Theoretical
Wed Dec 05, 2018 12:20 pm
Forum: Investing - Theory, News & General
Topic: Daniel Kahneman: Your Intuition Is Wrong, Unless These 3 Conditions Are Met
Replies: 14
Views: 3472

Re: Daniel Kahneman: Your Intuition Is Wrong, Unless These 3 Conditions Are Met

And the third condition is immediate feedback. Kahneman said that “you have to know almost immediately whether you got it right or got it wrong.”
I think this one in particular separates the gut from the accurate snap judgement.
by Theoretical
Sun Dec 02, 2018 1:49 pm
Forum: Investing - Theory, News & General
Topic: Best Multifactor Funds to use for Tilting/Replacement?
Replies: 9
Views: 1094

Re: Best Multifactor Funds to use for Tilting/Replacement?

The Hartford multi-factor ETFs, iShares multi-factor ETFs, USAA Value Momentum Blend ETFs, and Franklin Templeton multi-factor ETFs all look compelling. Don't forget the John Hancock multi-factor ETFs. They are managed by some yahoos going by the name Dimensional Fund Advisors. Are they worth 30-50...
by Theoretical
Sat Dec 01, 2018 12:00 am
Forum: Investing - Theory, News & General
Topic: [Understanding volatility in ultrashort bond funds]
Replies: 49
Views: 5227

Re: Ultrashort bond funds in freefall

That ICSH looks pretty sweet. High credit quality, low duration, good yield, low expenses, tradeable, non-crashy (so far). Yep, I like it quite a bit as well. The main thing to watch out is that it's not commission free anywhere, so you if you're using it as a cash/savings account substitute, somet...
by Theoretical
Wed Nov 28, 2018 12:10 am
Forum: Investing - Theory, News & General
Topic: A bubble of corporate debt.
Replies: 31
Views: 3080

Re: A bubble of corporate debt.

What really is unbelievable is that much of this debt was used to finance buybacks (a practice that was outlawed in the 1930s for obvious reasons until being legalized in the 1980s) which has given the US equity markets the boost not seen in the rest of the world markets. So corporations are exchan...
by Theoretical
Sat Nov 24, 2018 5:19 pm
Forum: Investing - Theory, News & General
Topic: Penalty Free CD
Replies: 4
Views: 771

Re: Penalty Free CD

There's likely some caveat/wiggle language that allows them to restrict redemptions in way that should not ever happen with a money market fund.
by Theoretical
Sat Nov 24, 2018 11:06 am
Forum: Investing - Theory, News & General
Topic: Advisor Perspectives Article: Are You Paying For Liquidity You Don’t Need?
Replies: 45
Views: 3293

Re: Advisor Perspectives Article: Are You Paying For Liquidity You Don’t Need?

I think my biggest concern with explicitly targeting the illiquid is that illiquidity has a bad habit of going from merely illiquid to permafrost. As in you get rewarded for taking the premium in good times but get hurt even ore than you bargain for in the bad.
by Theoretical
Sat Nov 24, 2018 12:30 am
Forum: Investing - Theory, News & General
Topic: Fidelity Adds More iShares ETFs Commission Free
Replies: 3
Views: 1117

Re: Fidelity Adds More iShares ETFs Commission Free

My bad, I'd not seen it with the Zero announcement. Still, it's nice to have.
by Theoretical
Fri Nov 23, 2018 8:24 am
Forum: Investing - Theory, News & General
Topic: Fidelity Adds More iShares ETFs Commission Free
Replies: 3
Views: 1117

Fidelity Adds More iShares ETFs Commission Free

Now Fidelity is up to 239 iShares ETFs from the previous 70. https://research2.fidelity.com/pi/etf-screener#theme/300 Notable additions include the asset allocation etfs (like AOM and AOK), the silver and gold trusts (SLV and IAU), the iBonds target maturity muni and corporate ETFs, and the Single C...
by Theoretical
Thu Nov 22, 2018 6:38 pm
Forum: Investing - Theory, News & General
Topic: Managed Futures Fund...If you must
Replies: 2
Views: 520

Re: Managed Futures Fund...If you must

+1 The other problem with AQR is asset bloat, particularly in the commodities side. Since these are so expensive, you really don't want something managed at a 5-10% volatility, because you have to have a bunch to provide the diversification. Here's 2 others. Jerry Parker is one of the original turtl...
by Theoretical
Mon Nov 19, 2018 9:07 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Munis Increasingly Risky
Replies: 94
Views: 8934

Re: Larry Swedroe: Munis Increasingly Risky

One weakness of BMBIX now is that its prerefunded bond focus means a good chunk of the income will become taxable as post-2017 bonds start getting refunded under the new tax code. I'm also increasingly concerned/alarmed by the amount of holdings in Illinois (including some not pre-refunded) and a co...
by Theoretical
Wed Nov 14, 2018 12:46 am
Forum: Investing - Theory, News & General
Topic: "Rules-Based Risk Management System" = Market Timing = Momentum/Trend Following?
Replies: 64
Views: 3385

Re: "Rules-Based Risk Management System" = Market Timing = Momentum/Trend Following?

I have no connection with this firm. Pacer ETFs have trend-following ETFs for stock indicies, PLTC (SP500 I believe), PTMC (Midcap), PTNQ (nasdaq 100) & PTEU www.paceretfs.com Here is a video of their system. https://www.paceretfs.com/library/videos/trend-following-etfs/ Rules https://www.paceretfs...
by Theoretical
Mon Nov 12, 2018 7:14 pm
Forum: Investing - Theory, News & General
Topic: AQR fund family's performance relative to its benchmarks
Replies: 36
Views: 2890

Re: AQR fund family's performance relative to its benchmarks

As a hedge fund investor, you want to pay performance fees so they actually have an incentive to try. Otherwise you get stuck with an under-performing asset gatherer like AQR. This is precisely the justification behind one of the oldest CTAs, Dunn Capital Management, which has a 0/25% cost structur...
by Theoretical
Sat Nov 10, 2018 10:31 pm
Forum: Investing - Theory, News & General
Topic: "Rules-Based Risk Management System" = Market Timing = Momentum/Trend Following?
Replies: 64
Views: 3385

Re: "Rules-Based Risk Management System" = Market Timing = Momentum/Trend Following?

I guess one of the dangers is letting your 12-month trend following strategy turn into a 30-month strategy when you finally capitulate on an asset class. IIRC, there are no momentum effects on timescales longer than about 12 months. (If anything, mean reversion.) That's actually one of the more int...
by Theoretical
Mon Oct 15, 2018 9:29 pm
Forum: Investing - Theory, News & General
Topic: Huge drops in VTXVX and VTHRX [Vanguard Target Date Funds]
Replies: 54
Views: 5010

Re: Huge drops in VTXVX and VTHRX [Vanguard Target Date Funds]

This is why it’s good to only check in on your portfolio occasionally. You miss stuff like this :sharebeer I think it’s more obvious that Vanguard is seriously cheaped out on the financial technology and it’s going to really bite them and a lot of people some day. There are a lot of these kind of e...
by Theoretical
Sun Oct 14, 2018 4:47 am
Forum: Investing - Theory, News & General
Topic: DGS: Own it? Opinions on it? [WisdomTree Emerging Mkts SmallCap Dividend]
Replies: 25
Views: 1809

Re: DGS: Own it? Opinions on it?

It's fine and doesn't really have a competitor but the ER is high. Yeah, the expenses bother me too. Really the only fault I can find with it. Once you get used to Vanguard everything else looks way too expensive. Expenses are the only thing we can control and I fear that a small value tilt may not...
by Theoretical
Fri Oct 05, 2018 8:16 pm
Forum: Investing - Theory, News & General
Topic: Yale's 'Warren Buffett' places big bets on cryptocurrency funds
Replies: 36
Views: 2727

Re: Yale's 'Warren Buffett' places big bets on cryptocurrency funds

This seems more like a venture capital rather than private equity deal, with some majorly positively skewed returns on the docket. Blockchain is an emerging, bleeding edge technology. I’d suspect this fund is going for “stick your fingers in lots of pies” approach and one or two could be absolute ja...
by Theoretical
Thu Oct 04, 2018 4:22 pm
Forum: Investing - Theory, News & General
Topic: When does a stock become a bond before moving back to a stock again
Replies: 47
Views: 2388

Re: When does a stock become a bond before moving back to a stock again

The problem with this combo of pension, stock and employment is called convergent risk, and this has tons of it.

https://m.youtube.com/watch?v=6vcxsJVBqIo
by Theoretical
Thu Oct 04, 2018 3:53 pm
Forum: Investing - Theory, News & General
Topic: When does a stock become a bond before moving back to a stock again
Replies: 47
Views: 2388

Re: When does a stock become a bond before moving back to a stock again

Would your consider posting your 401k fund options, or are these restricted stock options?
by Theoretical
Thu Oct 04, 2018 3:42 pm
Forum: Investing - Theory, News & General
Topic: A simple moving average timing model using stocks and treasuries
Replies: 40
Views: 2744

Re: A simple moving average timing model using stocks and treasuries

The problem with buy-and-hold is the deep drawdowns. This is hard for many to stomach. Even if their stock holding are 'just' 50% of their portfolio, seeing that get cut in half is something that some investors want to avoid. This is correct, and this board (usually) helps people stomach those temp...
by Theoretical
Wed Oct 03, 2018 5:52 pm
Forum: Investing - Theory, News & General
Topic: A simple moving average timing model using stocks and treasuries
Replies: 40
Views: 2744

Re: A simple moving average timing model using stocks and treasuries

If you want to do this, listen to systematic traders first. What they describe is VERY different. Fiddling is known as curve-fitting and is a deadly sin for either buy-and-hold or trend or any investment strategy. Their systems are more about controlling for risk, have a lot of small losses, and ten...
by Theoretical
Wed Oct 03, 2018 11:53 am
Forum: Investing - Theory, News & General
Topic: "Multialternative mutual fund returns"
Replies: 15
Views: 1659

Re: "Multialternative mutual fund returns"

What is the purpose of multialternative fund? Diversity of risk? My take is that these funds are trying to be what bonds used to be. The diversification benefits of bonds are greater when yields are 6% rather than 2%, simply because at 2% yields don't have as far to fall. Not only that, but at 2% y...
by Theoretical
Wed Oct 03, 2018 7:03 am
Forum: Investing - Theory, News & General
Topic: Is an emergency fund just about market timing?
Replies: 103
Views: 5796

Re: Is an emergency fund just about market timing?

Given that equities are perfectly liquid nowadays and generally free to trade (or at the very least, functionally free), what is the rationale for keeping an emergency fund when you can just sell investments to meet any expenses? They get a lot less liquid at the times people are most likely to los...
by Theoretical
Tue Oct 02, 2018 11:08 am
Forum: Investing - Theory, News & General
Topic: Is an emergency fund just about market timing?
Replies: 103
Views: 5796

Re: Is an emergency fund just about market timing?

This strikes me as yet another symptom of a bull market. An E fund is for the fact that life is full of uncertainty, including personal, local, and national/global black swans. I might also add that Stay-the-Course investing requires an iron stomach and a lot of discipline, and having sufficient res...
by Theoretical
Fri Sep 28, 2018 9:22 pm
Forum: Investing - Theory, News & General
Topic: Tail Risk Protection
Replies: 30
Views: 3461

Re: Tail Risk Protection

Quotes from the article in Alpha Architect by Aaron Brask on strategies to achieve tail risk protection. TRH strategies are very complex and will often end up with polarized results. As highlighted in the disclaimer above, it is important to understand these strategies are speculative in nature. Ac...
by Theoretical
Fri Sep 28, 2018 6:54 am
Forum: Investing - Theory, News & General
Topic: SEC charges Musk with Fraud!
Replies: 117
Views: 10857

Re: SEC charges Musk with Fraud!!!

One takeaway I had....Avoid stocks where the CEO is a prolific social media user. This aspect really has not been commented upon. Guess what? Social media posts can and will be used in a court of law. I sometimes wonder if people actually get that or not. In Mr. Musk's case, evidently not. I might ...
by Theoretical
Thu Sep 27, 2018 9:41 am
Forum: Investing - Theory, News & General
Topic: A quick peek at a RAFI Fundamental Large-Cap Index Fund, ten years later
Replies: 22
Views: 1701

Re: A quick peek at a RAFI Fundamental Large-Cap Index Fund, ten years later

Just to add some more context to the discussion. It's impressive the fundamental US large cap index has kept up with the S&P 500, given the fact the Fundamental index significantly underweights the technology sector due to their high valuations. The Fundamental index overweighted financials after t...
by Theoretical
Thu Sep 27, 2018 8:02 am
Forum: Investing - Theory, News & General
Topic: Research Affiliates: Alternative Risk Premia
Replies: 39
Views: 1929

Re: Research Affiliates: Alternative Risk Premia

The difference between the two types is that both get hurt by a reversal (where prices go up after having fallen previously), but cross-sectional stays in the red when the stocks that have been doing the worst are now the best and vice versa. Declining prices in both assets: LS Cross sectional Mom: ...
by Theoretical
Thu Sep 27, 2018 12:49 am
Forum: Investing - Theory, News & General
Topic: Research Affiliates: Alternative Risk Premia
Replies: 39
Views: 1929

Re: Research Affiliates: Alternative Risk Premia

The author makes a point that I had intuitively believed in the past, but he adds a lot of credence to it. In the footnotes “As the central limit theorem of statistics establishes, mixing together non-normal distributions moves the combined result toward a more normal-looking distribution; that is,...
by Theoretical
Wed Sep 26, 2018 12:32 pm
Forum: Investing - Theory, News & General
Topic: Tail Risk Protection
Replies: 30
Views: 3461

Re: Tail Risk Protection

It’s a Swedroe approach, not a Ferri one.

One justification is that small Value stocks tend to have a lot of internal leverage, and if you plot them vs the 500 at 1.5x -50% cash, you get similar results overall both in return and standard deviation.
by Theoretical
Tue Sep 25, 2018 4:22 pm
Forum: Investing - Theory, News & General
Topic: Total Treasuries Market vs Intermediate Treasuries vs Total Bond Market
Replies: 111
Views: 6825

Re: Total Treasuries Market vs Intermediate Treasuries vs Total Bond Market

The switch from TBM -> Intermediate Treasuries was driven by the desire to hold the "risk free" asset (Treasuries) and take the majority of my risk on the equity side, excising corporate bonds from the asset allocation. This is not very radical (although not so common among Bogleheads, for some rea...
by Theoretical
Tue Sep 25, 2018 3:02 pm
Forum: Investing - Theory, News & General
Topic: Total Treasuries Market vs Intermediate Treasuries vs Total Bond Market
Replies: 111
Views: 6825

Re: Total Treasuries Market vs Intermediate Treasuries vs Total Bond Market

Fidelity has 3 $0 minimum treasury funds with an ER of .03% now. Set the allocation once to match GOVT’s characteristics, reinvest dividends, and you’re good to go. Furthermore, unlike ETFs, you can put exact amounts into each fund. The tax benefits of ETFs for stocks don’t really Also, the Vanguard...
by Theoretical
Tue Sep 25, 2018 10:11 am
Forum: Investing - Theory, News & General
Topic: PIMCO PTY
Replies: 2
Views: 248

Re: PIMCO PTY

Leverage, junk bonds, being at a discount to NAV, and return of capital can all play a role. The fact this fund has those kind of yields and is selling at a 20% premium scares the daylights out of me.
by Theoretical
Tue Sep 25, 2018 9:44 am
Forum: Investing - Theory, News & General
Topic: Vanguard New Factor Funds Portfolio Statistics
Replies: 213
Views: 31705

Re: Vanguard New Factor Funds Portfolio Statistics

I am guessing limit orders are still advisable for these funds? I just transferred assets from an adviser and will be buying ~15k vfmf and ~10k vfva later this week. I doubt you’d need it. You can expect instantaneous execution at the prevailing ask price regardless of quantity. Almost certainly. I...
by Theoretical
Mon Sep 24, 2018 10:38 pm
Forum: Investing - Theory, News & General
Topic: Tail Risk Protection
Replies: 30
Views: 3461

Re: Tail Risk Protection

There's also this Alpha Architect article by a guest poster on the subject: https://alphaarchitect.com/2018/04/05/t ... anagement/
by Theoretical
Mon Sep 24, 2018 10:36 pm
Forum: Investing - Theory, News & General
Topic: Are Government Back Bonds or FDIC Insured accounts more at risk of Default?
Replies: 33
Views: 1799

Re: Are Government Back Bonds or FDIC Insured accounts more at risk of Default?

Buffett repeated the same thing, back around 2012 when news stories focused on the credit rating of the US government dropping from AAA to AA. Buffett pointed out that Euro-zone countries are in a different situation, because the individual countries issue their own debt but not their own currency ...
by Theoretical
Mon Sep 24, 2018 3:11 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Factors Persist In Emerging Markets
Replies: 31
Views: 2410

Re: Larry Swedroe: Factors Persist In Emerging Markets

Yes. To say certain factor has provided a risk premium is perfectly fine. To say this factor provides a premium is definitive meaning it ALWYS provides a premium. That cannot be known. Are there really that many people confusing that distinction? The same could be said for just stocks in general to...
by Theoretical
Mon Sep 24, 2018 2:00 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Factors Persist In Emerging Markets
Replies: 31
Views: 2410

Re: Larry Swedroe: Factors Persist In Emerging Markets

Rick Ferri wrote:
Mon Sep 24, 2018 1:39 pm
Yes. To say certain factor has provided a risk premium is perfectly fine. To say this factor provides a premium is definitive meaning it ALWYS provides a premium. That cannot be known.
That’s not to mention that a premium can be negative. It’s an integer, not just a positive number.
by Theoretical
Mon Sep 24, 2018 9:36 am
Forum: Investing - Theory, News & General
Topic: Are Government Back Bonds or FDIC Insured accounts more at risk of Default?
Replies: 33
Views: 1799

Re: Are Government Back Bonds or FDIC Insured accounts more at risk of Default?

Default risk is not zero for either but with debt it’s as much about the amount of liquidity as it is the debt burden. Most US debt is nominal, so in the worst case, you get inflation rather than default. This is the (up/down)side of a fiat money system, unlike in WWI (entente powers) or the Depress...
by Theoretical
Sat Sep 22, 2018 6:23 pm
Forum: Investing - Theory, News & General
Topic: Buying Put Options on the S&P 500
Replies: 22
Views: 2215

Re: Buying Put Options on the S&P 500

OP - Traders buy put options. Traders consider that insurance if the short term trade does not work out. Long term buy/hold investors usually don't buy put options. There is no need for a long term investor to do it - because a long term investor is never trying to time the market. A long term inve...
by Theoretical
Thu Sep 20, 2018 8:03 pm
Forum: Investing - Theory, News & General
Topic: Tail Risk Protection
Replies: 30
Views: 3461

Re: Tail Risk Protection

Ditto and buy tail hedges so that you’re selling stuff near the money and buying for the black swan.
by Theoretical
Thu Sep 20, 2018 7:45 pm
Forum: Investing - Theory, News & General
Topic: Tail Risk Protection
Replies: 30
Views: 3461

Re: Tail Risk Protection

That’s Swedroe not Ferri. And the bonds are treasuries.
by Theoretical
Thu Sep 20, 2018 10:42 am
Forum: Investing - Theory, News & General
Topic: In defense of Hedge Funds
Replies: 22
Views: 1639

Re: In defense of Hedge Funds

The last 36 years have been a world where two asset classes have served investors well, with zero to sharply negative correlations. Stock heavy investors haven’t really been served by hedge funds since they’ve performed more like really expensive bonds. Bond heavy investors did pretty well until the...
by Theoretical
Wed Sep 19, 2018 11:57 am
Forum: Investing - Theory, News & General
Topic: TSP to Increase Stock Holdings in L Funds
Replies: 49
Views: 2849

Re: TSP to Increase Stock Holdings in L Funds

Here’s the difference. It’s asset class active management. It would be like if the fruit basket at work carried both apples and oranges. As new varieties come into market or become easier to get you add more varieties, the selections increase. If total market funds (singly or combined) are in the TD...
by Theoretical
Wed Sep 19, 2018 8:13 am
Forum: Investing - Theory, News & General
Topic: TSP to Increase Stock Holdings in L Funds
Replies: 49
Views: 2849

Re: TSP to Increase Stock Holdings in L Funds

I continue to be amazed by how actively managed TDFs are.
by Theoretical
Sun Sep 16, 2018 1:01 pm
Forum: Investing - Theory, News & General
Topic: What are the "best" factors?
Replies: 23
Views: 2046

Re: What are the "best" factors?

Value and Trend-following (Time-Series Momentum) are two of the best cases. Cross-sectional momentum has a lot of academic support and great results, but is nigh impossible to capture absent a lot of negative alpha.
by Theoretical
Thu Sep 13, 2018 8:19 pm
Forum: Investing - Theory, News & General
Topic: How is Interactive Brokers Smart Beta Portfolios different from ETFs?
Replies: 8
Views: 986

Re: How is Interactive Brokers Smart Beta Portfolios different from ETFs?

If this is what I think it is, then it’s far different than an ETF. It’s an 8 basis point separately managed account with individual stock holdings, which means you can get the benefit of tax harvesting on the loss side in addition to facing the capital gains.