Search found 918 matches

by Theoretical
Sun Apr 30, 2017 3:31 pm
Forum: Investing - Help with Personal Investments
Topic: Where to park 200k cash for 2-5 years
Replies: 12
Views: 1456

Re: Where to park 200k cash for 2-5 years

All of these recommendations are missing the fact the OP is in California. CDs and corporate bonds get double doses of taxes. I think 10-20% should be invested in stocks (limiting the downside while providing real diversification) and the rest is a mix of short term TVA bonds (near CD rates and stat...
by Theoretical
Sun Apr 30, 2017 10:59 am
Forum: Investing - Theory, News & General
Topic: Question for quants, math geeks - reducing volatility in my costs?
Replies: 18
Views: 1069

Re: Question for quants, math geeks - reducing volatility in my costs?

Honestly, this sounds like something where you should consult a business consultant and a specialist financial consultant to evaluate what is and is not an appropriate hedging vehicle. Since it's not a readily traded commodity, I think you're very likely to do more harm than good by only DIY'ing it....
by Theoretical
Sun Apr 30, 2017 9:23 am
Forum: Investing - Theory, News & General
Topic: Diversifying Power of Longer Term US Treasuries
Replies: 59
Views: 20885

Re: Diversifying Power of Longer Term US Treasuries

can we conclude that during a bear market caused by a financial crisis/Deflation, Long-Term US Treasuries are very likely to have the higher negative correlation to stocks compared to other types of bonds or fixed income? I'd say mostly yes, with a caveat. Generally bonds of longer duration should ...
by Theoretical
Sat Apr 29, 2017 3:09 pm
Forum: Investing - Help with Personal Investments
Topic: Help with Investing for Elderly Parents
Replies: 14
Views: 949

Re: Help with Investing for Elderly Parents

A joint life Single Premium Immediate Annuity seems like it'd be near-perfect for some of the money. Mix it with building a savings cushion and maybe 20% stocks and you're set. The stocks add diversification without upping volatility overall. Try something like $150K in Total Market funds (a single ...
by Theoretical
Thu Apr 27, 2017 11:37 pm
Forum: Investing - Theory, News & General
Topic: Tax Loss Harvesting on a one fund portfolio
Replies: 6
Views: 660

Re: Tax Loss Harvesting on a one fund portfolio

31 days, unless you sell ALL of the TLH partner, including in your IRAs/HSA/other accounts. Alternately, if you end up triggering VG's frequent trading, you'll want to switch to ETFs at least for a large chunk.
by Theoretical
Thu Apr 27, 2017 7:57 am
Forum: Investing - Theory, News & General
Topic: DEMSX vs VSS [DFA Emerg. Mkts Small Cap vs. Vanguard FTSE All-World ex-US]
Replies: 20
Views: 1332

Re: DEMSX vs VSS

Tracking error (which can be huge in either direction) and the lack of capital gains distributions.
by Theoretical
Thu Apr 27, 2017 7:36 am
Forum: Investing - Theory, News & General
Topic: Tax Loss Harvesting on a one fund portfolio
Replies: 6
Views: 660

Re: Tax Loss Harvesting on a one fund portfolio

Just buy Vanguard Large Cap or the S&P 500 funds, or do you just start dumping your cash on hand into the VTSAX fund, so when it goes up you have more shares at a cheaper price, so you end up farther out in the end? Just buy more of the TLH partner as you would normally or wait 30 days and if yo...
by Theoretical
Thu Apr 27, 2017 12:24 am
Forum: Investing - Theory, News & General
Topic: DEMSX vs VSS [DFA Emerg. Mkts Small Cap vs. Vanguard FTSE All-World ex-US]
Replies: 20
Views: 1332

Re: DEMSX vs VSS

For EWX and EEMS, ignore the expense ratios. Securities lending brings both funds effective expense ratios (what you see) into the teens or lower. DGS is still about 50-55 bp in expenses. If it's taxable, I'd take EEMS every day and Sunday, high spreads and all. VSS's analogue would be something lik...
by Theoretical
Wed Apr 26, 2017 2:15 pm
Forum: Investing - Help with Personal Investments
Topic: $1m capital gains, worth it to simplify and index?
Replies: 46
Views: 3719

Re: $1m capital gains, worth it to simplify and index?

It'll take awhile but I'd recommend using this: https://www.tdameritrade.com/education/tools-and-calculators/morningstar-instant-xray.page to plug everything in. You don't need an ameritrade account. Then, post a screenshot of the style box and describe the stocks/bond ratio. There's also a tab that...
by Theoretical
Wed Apr 26, 2017 12:18 pm
Forum: Investing - Help with Personal Investments
Topic: Diversifying same-index ETFs
Replies: 12
Views: 325

Re: Diversifying same-index ETFs

Your concern is why we use two brokerages for the custody of the assets. But it has no reflection on an ETFs or mutual funds themselves because of SEC rules.
by Theoretical
Wed Apr 26, 2017 9:56 am
Forum: Investing - Theory, News & General
Topic: What is your overall portfolio weighted expense ratio
Replies: 189
Views: 13537

Re: What is your overall portfolio weighted expense ratio

Funds only - (3/4 of portfolio) - .4 (very expensive 401k and a small slug of managed futures). Heavy tilts.

With CDs and individual bonds - .3
by Theoretical
Wed Apr 26, 2017 9:51 am
Forum: Investing - Theory, News & General
Topic: How do you do the Larry Portfolio?
Replies: 54
Views: 8184

Re: How do you do the Larry Portfolio?

With the 50/50 allocation, I think the US market cap in the wake of 2008 was something like 46-47%, and the US has had a big runup since, so 54% is not surprising. Both are within 5% of a rebalancing spectrum. Plus, it's a good round number.

Lt. Columbo - no it was to the question right before yours.
by Theoretical
Tue Apr 25, 2017 12:58 pm
Forum: Investing - Theory, News & General
Topic: How do you do the Larry Portfolio?
Replies: 54
Views: 8184

Re: How do you do the Larry Portfolio?

The LP is just a unit of equities that can be in any ratio with safe bonds. It's not inherently 30/70. But when measuring your risk tolerance, you should take the equity position you'd hold untilted and reduce it by 1/3 (or alternately multiply the LP by 1.5) to get your equivalent risk tolerance an...
by Theoretical
Tue Apr 25, 2017 9:18 am
Forum: Personal Finance (Not Investing)
Topic: Ally Bank - Savings Account Rate Increased!
Replies: 70
Views: 7948

Re: Ally Bank - Savings Account Rate Increased!

The Wizard wrote:The annualized dividend from total stock market VTSAX is generally greater than 1.05% and is taxed more favorably.
Boo to savings accounts!


VTSAX and savings accounts aren't like comparing apples and oranges. It's more like grapefruits and chicken wings.
by Theoretical
Mon Apr 24, 2017 5:52 pm
Forum: Investing - Theory, News & General
Topic: What's Wrong With AQR? (Managed Futures)
Replies: 66
Views: 4959

Re: What's Wrong With AQR? (Managed Futures)

grap0013 wrote:These are the kind of threads that knocked our Dear Mr. Swedroe's hit points to zero. Don't fall for it lack_ey! I do not think you are going to convince the opposition of anything. Save your time and energies to be used towards more fruitful endeavors.


Yep, agreed.
by Theoretical
Mon Apr 24, 2017 3:58 pm
Forum: Investing - Theory, News & General
Topic: Reasons to Hold Corporate Bonds vs. Munis, given equal after-tax yield?
Replies: 7
Views: 724

Re: Reasons to Hold Corporate Bonds vs. Munis, given equal after-tax yield?

I like the mix of going short (term) corporate, long(er) AAA/AA municipal, and longest TVA or other non-callable Agency bonds. That's a nice combo to go with treasuries and CDs.
by Theoretical
Mon Apr 24, 2017 2:17 pm
Forum: Investing - Theory, News & General
Topic: Reasons to Hold Corporate Bonds vs. Munis, given equal after-tax yield?
Replies: 7
Views: 724

Re: Reasons to Hold Corporate Bonds vs. Munis, given equal after-tax yield?

I really like Nebraska, (both) Dakotas, Florida, Iowa, Oklahoma, and Tennessee municipals. If you've got $50K+ to invest (to ensure liquidity, then I think 20 year AAAs or buying several single state funds can make a lot of sense. Tennessee Valley authority bonds offer a nice risk-return because whi...
by Theoretical
Mon Apr 24, 2017 11:42 am
Forum: Investing - Theory, News & General
Topic: What's Wrong With AQR? (Managed Futures)
Replies: 66
Views: 4959

Re: What's Wrong With AQR? (Managed Futures)

While I appreciate some of the posts, "just save more, too complicated, look at LTCM, etc...." they do not add a lot to the nuts and bolts discussion of the strategy. Those posts always show up several times in every ALT or tilting discussion. Do you see me chime in on 3 fund portfolio or...
by Theoretical
Mon Apr 24, 2017 8:53 am
Forum: Investing - Theory, News & General
Topic: Question for RobertT
Replies: 40
Views: 7777

Re: Question for RobertT

Also, there's nothing indicative about a REIT tilt that gets you to momentum. The closest analogue would be a Midcap growth fund.
by Theoretical
Sun Apr 23, 2017 6:50 pm
Forum: Investing - Theory, News & General
Topic: How would tax bracket changes affect the value of munis?
Replies: 7
Views: 700

Re: How would tax bracket changes affect the value of munis?

I'd say some of the risk is baked in right now, especially towards the longer durations.

20 year AAA munis are yielding better than 20 year AAA corporates dollar-for-dollar, with some no doubt reflecting the elevated risks of Illinois and Massachusetts.
by Theoretical
Sun Apr 23, 2017 6:14 pm
Forum: Investing - Theory, News & General
Topic: Larry Portfolio Equities: What % Each Market?
Replies: 50
Views: 3612

Re: Larry Portfolio Equities: What % Each Market?

Running the factor loadings, IJS (since 1/1/06 when the index was switched to its current multifactor) has a factor loading of .5 (AQR - with F/F it's .37 and .47) and DFSVX is 2-3 times more expensive in terms of tax cost ratio. DFSVX is a bit smaller but the negative alpha is comparable to worse. ...
by Theoretical
Sun Apr 23, 2017 4:28 pm
Forum: Investing - Theory, News & General
Topic: Larry Portfolio Equities: What % Each Market?
Replies: 50
Views: 3612

Re: Larry Portfolio Equities: What % Each Market?

The specific Larry Portfolio is in Chapter 3 of Reducing Black Swans, and there it's a 28/72 split.
by Theoretical
Sun Apr 23, 2017 11:06 am
Forum: Investing - Theory, News & General
Topic: Is $20K I-Bonds considered cash or bond?
Replies: 62
Views: 4212

Re: Is $20K I-Bonds considered cash or bond?

Here's my criteria: Can you write a check from a fund that is designed to hold short-term? Money Market Funds (post-2008 caveats apply), actual cash in the bank, and 1 month T-bills all fit the criteria. I Bonds have an instant-liquidate feature but include a 1 year lockup and a 5 year interest pena...
by Theoretical
Sun Apr 23, 2017 10:39 am
Forum: Investing - Theory, News & General
Topic: Larry Portfolio Equities: What % Each Market?
Replies: 50
Views: 3612

Re: Larry Portfolio Equities: What % Each Market?

From Looking at the FTSE Global Small Cap, counting Taiwan and South Korea as Emerging, you get 11.92% Emerging markets in this category. http://www.ftse.com/Analytics/FactSheets/Home/DownloadSingleIssue/GAE?issueName=GEISSC The current US/Developed/Emerging split is 53.24/34.84/11.92. All of those ...
by Theoretical
Sat Apr 22, 2017 10:26 am
Forum: Investing - Theory, News & General
Topic: Ally Bank Just Raised 5yr CD to 2.25%
Replies: 28
Views: 3836

Re: Ally Bank Just Raised 5yr CD to 2.25%

I was just about to open some new CDs and noticed Ally Bank raised their high-yield 5yr CD to 2.25% across all tiers. EWP is still 150 days Click "View All CD Rates" on this page: https://www.ally.com/bank/cd-rates/#view-cd-rates Vanguard brokered CDs are paying 2.40% for five year term. ...
by Theoretical
Fri Apr 21, 2017 11:28 am
Forum: Investing - Theory, News & General
Topic: Anybody purposely loading up on mortgage debt?
Replies: 107
Views: 10096

Re: Anybody purposely loading up on mortgage debt?

Let's say that someone has $100,000 of stocks, $100,000 of bonds, and a $100,000 mortgage balance. What is that person's real AA? If he is only looking at his investment portfolio, he would say 50% stocks and 50% bonds. But if he is looking at the whole situation, he is 33% stocks and 67% bonds. I'...
by Theoretical
Fri Apr 21, 2017 11:13 am
Forum: Investing - Theory, News & General
Topic: How inefficient is it to hold Total Bond Index in a taxable account?
Replies: 34
Views: 4187

Re: How inefficient is it to hold Total Bond Index in a taxable account?

We are at 25% and for our bond holdings we use a mix of BMBIX, some prerefunded bonds all maturing in the next quarter or two, one 15 year legacy muni bond, and brokered CDs in about a 5 year ladder (I say about because it's odd lots), and a small TVA 20 year zero coupon agency bond. We'll probably ...
by Theoretical
Fri Apr 21, 2017 11:05 am
Forum: Investing - Help with Personal Investments
Topic: Medium term taxable account investment plan
Replies: 6
Views: 532

Re: Medium term taxable account investment plan

I think that's a too aggressive a starting place for the 5-10 year plan, mainly because your downside is going from 50K to 30K (for a 50% decline in the equities). I'd either treat it as another slug of your portfolio (in which case it should be managed in accordance with your IPS or pay down the mo...
by Theoretical
Thu Apr 20, 2017 5:56 pm
Forum: Investing - Theory, News & General
Topic: How inefficient is it to hold Total Bond Index in a taxable account?
Replies: 34
Views: 4187

Re: How inefficient is it to hold Total Bond Index in a taxable account?

Do you face state or local taxes? If so, consider a mix of short term treasury ETFs (VGSH comes to mind) and an intermediate municipal fund. For taxable bonds, ETFs have a major advantage over mutual funds because of how they deal with capital gains.
by Theoretical
Thu Apr 20, 2017 5:35 pm
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 320
Views: 16032

Re: I don't understand the case for EE bonds

I agree, with the caveat that EEs can make sense for educational uses (tax-free for that use) in a way other bonds cannot. However, 20 year Tennessee Valley Authority zero coupon bonds yield 3.45% (and were yielding a little higher earlier), just 8 basis points less than EE bonds while being liquid ...
by Theoretical
Thu Apr 20, 2017 5:16 pm
Forum: Investing - Theory, News & General
Topic: Evaluating my lack of jitters
Replies: 26
Views: 1672

Re: Evaluating my lack of jitters

I have trouble getting excited about 3 percent bonds when I can invest in Vanguard's High Dividend Index Fund for almost nothing in expense ratio and it has a 3 percent APR. I'm afraid you have it backwards. 3% bonds>3% High Dividend Yield stocks. High Dividend Yield targeting often targets compani...
by Theoretical
Thu Apr 20, 2017 4:09 pm
Forum: Investing - Theory, News & General
Topic: A test for when risk factors have positive expected returns
Replies: 51
Views: 2987

Re: A test for when risk factors have positive expected returns

An interesting suggestion. You probably know more about these proposals than I do. Maybe try telling a story? An investors comes on Bogleheads and post her portfolio in the usual way. After a few pages of discussion, we conclude that yes, she should definitely not own the total market and should in...
by Theoretical
Thu Apr 20, 2017 12:44 pm
Forum: Investing - Theory, News & General
Topic: Evaluating my lack of jitters
Replies: 26
Views: 1672

Re: Evaluating my lack of jitters

What's your spouse's take on the jitters? If it was just you, I'd say you're fine at 85-15 if it's just you, but you've got an "other half" that may have a different perspective and risk tolerance.
by Theoretical
Thu Apr 20, 2017 10:28 am
Forum: Investing - Theory, News & General
Topic: Site to measure individual bond's performance
Replies: 2
Views: 296

Site to measure individual bond's performance

Does anyone know a resource that provides pricing/return info for individual bonds by CUSIP? Specifically, I'm asking about Tennessee Valley Authority agency bonds.

Morningstar has something with FINRA but the data seems to only go back to 2009.
by Theoretical
Thu Apr 20, 2017 7:15 am
Forum: Investing - Theory, News & General
Topic: Visualizing the devastating impact of fees
Replies: 54
Views: 4848

Re: Visualizing the devastating impact of fees

This makes 2/20 hedge funds look even more ridiculous as a BAD deal.
by Theoretical
Wed Apr 19, 2017 9:01 pm
Forum: Investing - Theory, News & General
Topic: Questions for Bridgeway Capital research team
Replies: 12
Views: 997

Re: Questions for Bridgeway Capital research team

I'd love an interval fund or CEF.
by Theoretical
Wed Apr 19, 2017 6:22 pm
Forum: Investing - Theory, News & General
Topic: Questions for Bridgeway Capital research team
Replies: 12
Views: 997

Re: Questions for Bridgeway Capital research team

How would they break down the negative alpha upwards of -3% annually for BRSMX in terms of the amounts lost to trading costs, missing the high (actual) gainers or loading up on the (actual) losers, or other causes (such as the neutral value load).
by Theoretical
Wed Apr 19, 2017 4:56 pm
Forum: Investing - Theory, News & General
Topic: "Commodities in Your Portfolio? 'Hogwash...'"
Replies: 21
Views: 2636

Re: "Commodities in Your Porfolio? 'Hogwash...'"

I think commodities, if they have a place at all, are most suited to short-term investment goals (such as a house down payment or college tuition soon to come) where most of the portfolio is in very short-term instruments or just sitting in a bank account. They add a slice of event risk if you choos...
by Theoretical
Tue Apr 18, 2017 11:51 pm
Forum: Investing - Theory, News & General
Topic: Is it necessary to diversify across Factors?
Replies: 123
Views: 6626

Re: Is it necessary to diversify across Factors?

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 Add Powershares (PRF and PDN) and Pimco's RAE Fundamental funds (Ameritrade has 0 minimum for institutional shares and you can set up...
by Theoretical
Tue Apr 18, 2017 11:41 pm
Forum: Investing - Theory, News & General
Topic: Value/Growth indices and overlapping bands
Replies: 21
Views: 1234

Re: Value/Growth indices and overlapping bands

Well fund construction does matter even to non-tilters because some people's best 401k option is a large growth fund that's well into the Growth side. Such a person would consider an SCV plus Large or Mid Value fund as a counterweight to be close to the US market.
by Theoretical
Mon Apr 17, 2017 10:29 pm
Forum: Investing - Help with Personal Investments
Topic: Fidelity equivalent of Vanguard small value index fund
Replies: 9
Views: 698

Re: Fidelity equivalent of Vanguard small value index fund

Are you limited to only mutual funds or can you use ETFs? If you're limited to just funds, then your options are a bit limited to stay commission-free. Fidelity's Enhanced Small Cap Index is a quantitative fund that covers value, quality, and momentum. It's decent, if expensive. FCPEX. .68. Northern...
by Theoretical
Mon Apr 17, 2017 8:57 pm
Forum: Investing - Help with Personal Investments
Topic: [Advice needed for mother's inheritance/finances.]
Replies: 129
Views: 12880

Re: Too much inheritance to handle. Advice needed

Agreed on the in-writing, certified mail.

Also, I don't know you at all, but I am very proud of you for taking the risk to investigate more thoroughly, even when you struggled with feeling "disloyal." That takes guts.
by Theoretical
Mon Apr 17, 2017 7:29 pm
Forum: Investing - Help with Personal Investments
Topic: [Advice needed for mother's inheritance/finances.]
Replies: 129
Views: 12880

Re: Too much inheritance to handle. Advice needed

Run from this guy. Seriously, put the money in a bank account (4 to be exact - FDIC limits) and learn. You are being taken for a big ride, sad to say. I don't even care who he is but his initial work is very self-serving and not in your best interests at all. He has already invested 150k in American...
by Theoretical
Sat Apr 15, 2017 5:28 pm
Forum: Investing - Help with Personal Investments
Topic: The great commodities debate
Replies: 38
Views: 6402

Re: The great commodities debate

The great irony is that they're actually now somewhat appealing, because they've been so bad. Indeed, as a post up top suggested, they've done exactly what they should in a time of deflation. What deflation? This hasn't been "a time of deflation." Perhaps the CPI-U went down slightly once...
by Theoretical
Fri Apr 14, 2017 9:20 pm
Forum: Investing - Help with Personal Investments
Topic: Allocation Decisions: LENDX, SRRIX and QSPIX
Replies: 23
Views: 1869

Re: Allocation Decisions: LENDX, SRRIX and QSPIX

Also, one of the insurance risks to consider is that in times of economic downturn, insurance fraud goes way up.
by Theoretical
Fri Apr 14, 2017 3:43 pm
Forum: Investing - Help with Personal Investments
Topic: Allocation Decisions: LENDX, SRRIX and QSPIX
Replies: 23
Views: 1869

Re: Allocation Decisions: LENDX, SRRIX and QSPIX

I'd treat both of the new funds as equity-ish because both have tail risks that bonds do not. The reinsurance risk in particular could go very tail-y if a natural disaster or terrorist attacked sets off a flurry of claims. I'd be curious how an institutional reinsurance portfolio did in the wake of ...
by Theoretical
Fri Apr 14, 2017 2:57 pm
Forum: Investing - Help with Personal Investments
Topic: Where to park Emergency Fund?
Replies: 32
Views: 2840

Re: Where to park Emergency Fund?

If it is not readily accessible, it doesn't really serve the purpose of an emergency fund well. Of course, if you have credit cards with sufficient credit lines, that buys you at least another month to get to the actual funds. Yeah, that really isn't the way an emergency fund works. Ok, tell me an ...
by Theoretical
Fri Apr 14, 2017 2:10 pm
Forum: Investing - Help with Personal Investments
Topic: The great commodities debate
Replies: 38
Views: 6402

Re: The great commodities debate

The great irony is that they're actually now somewhat appealing, because they've been so bad. Indeed, as a post up top suggested, they've done exactly what they should in a time of deflation. I think their value is lower to most Bogleheads because we tend to invest in short to intermediate term bond...
by Theoretical
Fri Apr 14, 2017 2:03 pm
Forum: Investing - Help with Personal Investments
Topic: Help with bond fund
Replies: 8
Views: 381

Re: Help with bond fund

Can you post the full list of the 401k funds? The fact that these funds have ERs of .46 and .7 suggests your plan is already quite a bit better than many 401ks that have ERs well north of 1%. For the bonds, I'd probably go with the PTTRX just because both bond funds take a fair bit of credit risk, b...
by Theoretical
Fri Apr 14, 2017 1:43 pm
Forum: Investing - Help with Personal Investments
Topic: Portfolio Thoughts
Replies: 2
Views: 267

Re: Portfolio Thoughts

A REIT tilt is fine, but you really should use either of the following ETFs instead of the mutual fund for a static slice: VNQ - .12 iShares REET - .14 - if you also want to get International REITs (not just real estate companies) However, more than a REIT tilt, I think the lack of Emerging Markets ...

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