Search found 1619 matches

by alex_686
Fri Apr 28, 2017 2:05 pm
Forum: Investing - Theory, News & General
Topic: Largest Funds by AUM
Replies: 14
Views: 439

Re: Largest Funds by AUM

Random thought. If you had access to a Bloomberg terminal you could pull up a index. With that index you could pull up every single passive ETF and mutual fund that used that index. Then you could pull on a historic basis the AUM and trading of those funds. I can think of couple of minor issues with...
by alex_686
Fri Apr 28, 2017 2:00 pm
Forum: Investing - Theory, News & General
Topic: Largest Funds by AUM
Replies: 14
Views: 439

Re: Largest Funds by AUM

But aren't pensions, insurance companies, etc. still using index funds and ETFs? Probably not. For large enough investors they can exploit the economies of scale internally without having to pay an outside company to do it for them. They also get a little bit more control and confidentiality. If yo...
by alex_686
Fri Apr 28, 2017 1:33 pm
Forum: Investing - Theory, News & General
Topic: Five year CD paying more than 10 yr. treasury
Replies: 11
Views: 976

Re: Five year CD paying more than 10 yr. treasury

Are the CDs callable? That could be another reason for the difference. No, in fact they are putable. Most CDs can be redeemed early with only a mild penalty. This depress the yield. The Treasury market is deep and liquid and is a much better choice if you have a couple of million dollars that you n...
by alex_686
Fri Apr 28, 2017 1:26 pm
Forum: Investing - Theory, News & General
Topic: Largest Funds by AUM
Replies: 14
Views: 439

Re: Largest Funds by AUM

I'm interested in this topic and I've read or at least seen a lot of active vs. passive posts and articles. And I'm curious about this concept of what happens when indexed investments in equities reach some sort of tipping point. If that is the case you should not care about large funds. What you s...
by alex_686
Fri Apr 28, 2017 12:51 pm
Forum: Investing - Theory, News & General
Topic: Shiller: Europe's low CAPE "reflects psychology"
Replies: 6
Views: 658

Re: Shiller: Europe's low CAPE "reflects psychology"

Maybe a low CAPE reflects high risk and high expected return? And if there’s a psychology story, then maybe a low CAPE predicts high risk adjusted returns. High risk and high returns would produce a high CAPE. Also a low risk low return situation would produce a high CAPE. PE ratios contain both re...
by alex_686
Fri Apr 28, 2017 12:44 pm
Forum: Investing - Theory, News & General
Topic: Largest Funds by AUM
Replies: 14
Views: 439

Re: Largest Funds by AUM

3. The current largest fund by AUM is the SPY ETF which has $184 billion. But I don't know how much of that is being invested by long term buy and hold investors. Isn't that fund being used for a lot of swing trading? Anyone have an idea? Why do you want to know this? Why does it matter? You can lo...
by alex_686
Fri Apr 28, 2017 11:20 am
Forum: Investing - Theory, News & General
Topic: Should we treat investors' tolerance for volatility as fixed?
Replies: 44
Views: 1103

Re: Should we treat investors' tolerance for volatility as fixed?

What I don't understand is those who are so risk averse that they are unwilling to see any volatility in their invested assets, despite the fact that many of their other assets (i.e. home, automobiles) are likely volatile too. We probably all know people who refuse to put any money into anything th...
by alex_686
Fri Apr 28, 2017 9:57 am
Forum: Investing - Help with Personal Investments
Topic: Stay Out Of REITs?
Replies: 31
Views: 2830

Re: Stay Out Of REITs?

Despite what the others say it does not make a lot of sense to diversify into REITs at all time highs. The US market in general is at all time highs. You'd be selling the market high and buying REITs high. I will second this - kind of. REIT valuations are no more out of line than the S&P 500. A...
by alex_686
Thu Apr 27, 2017 7:56 pm
Forum: Investing - Theory, News & General
Topic: Should we treat investors' tolerance for volatility as fixed?
Replies: 44
Views: 1103

Re: Should we treat investors' tolerance for volatility as fixed?

Fallible wrote:Have you read Daniel Kahneman's book, Thinking, Fast and Slow, on loss aversion, etc.,


Another good book is Michael Lewis' The Undoing Project. It is about Daniel Kahneman and Amos Tversky and how they came up with behavioral economics.
by alex_686
Thu Apr 27, 2017 6:31 pm
Forum: Investing - Theory, News & General
Topic: Should we treat investors' tolerance for volatility as fixed?
Replies: 44
Views: 1103

Re: Should we treat investors' tolerance for volatility as fixed?

Cognitive issues can be lumped into 2 categories. The first is logical or information processing issues. These have a good tract record where education helps. The second is behavioral or emotional processing issues. Education is not very effective here. Loss aversion, which is what I think you are t...
by alex_686
Thu Apr 27, 2017 5:57 pm
Forum: Investing - Help with Personal Investments
Topic: Thrivent Financial
Replies: 12
Views: 730

Re: Thrivent Financial

Never, ever, tangle your financial affairs with friends, relatives (except parents, spouses, and children), or members of your church or club. As a side note, I would not consider Thrivent itself to be a religious origination. As a fraternal organizations the need a common bond between members - ju...
by alex_686
Thu Apr 27, 2017 4:27 pm
Forum: Investing - Help with Personal Investments
Topic: Thrivent Financial
Replies: 12
Views: 730

Re: Thrivent Financial

I used to work for Thrivent. There are some things that I found very attractive about Thrivent. They are member owned, and have a sense of mission that extends beyond making a quick dollar. In short, a solid reliable firm. Maybe a little old fashion. The downside of Thrivent is that it is its 1. act...
by alex_686
Thu Apr 27, 2017 10:37 am
Forum: Investing - Help with Personal Investments
Topic: I thought I understood MF expense ratios -
Replies: 13
Views: 734

Re: I thought I understood MF expense ratios -

My understanding was that trading costs are part of the expense ratio. Also, I thought that the expenses are removed on an average basis, not on a day-to-day basis, which would mean that someone who gets in today COB will be worse off than someone who gets in tomorrow COB, if tomorrow was when, say...
by alex_686
Thu Apr 27, 2017 10:27 am
Forum: Investing - Help with Personal Investments
Topic: I thought I understood MF expense ratios -
Replies: 13
Views: 734

Re: I thought I understood MF expense ratios -

I thought trading costs were not calculated/charged in the expense ratio. Vanguard does not have 12b-1 fees. So, this is pulled from the summary prospectus of Vanguard Total Stock Market Index Fund, Annual Fund Operating Expenses, Investor Shares Admiral Shares Management Fees 0.13% 12b-1 Distribut...
by alex_686
Thu Apr 27, 2017 9:47 am
Forum: Investing - Help with Personal Investments
Topic: I thought I understood MF expense ratios -
Replies: 13
Views: 734

Re: I thought I understood MF expense ratios -

I thought I understood Vanguard MF expense ratios, but some recent posts have confused me. It was my understanding that the published expense ratio was charged daily until a new (higher or lower) ratio was disclosed. Is this correct? The expenses that go into the expense ratio can be broken down in...
by alex_686
Thu Apr 27, 2017 9:18 am
Forum: Investing - Theory, News & General
Topic: Vanguard New Lower ER .04%
Replies: 56
Views: 5158

Re: Vanguard New Lower ER .04%

Sounds like Vanguard is trying to supplant Fidelity as the low ER group. Maybe they want to be the new Fidelity. I want to play devil's advocate for a moment. How confident are we that Vanguard's expense is lower than Fidelity's? A fund's expenses is a combination of explicate observable expenses, ...
by alex_686
Wed Apr 26, 2017 4:26 pm
Forum: Investing - Help with Personal Investments
Topic: One Fund? Really?
Replies: 48
Views: 4800

Re: One Fund? Really?

On annuites, I wonder what happens if the [color=#408040] insurance company goes belly up While not risk free, life insurance is very low risk. State regulators provided strict guidelines on actuarial assumptions and expected returns on assets. The insurance company's models must be reviewed and ap...
by alex_686
Wed Apr 26, 2017 3:50 pm
Forum: Investing - Help with Personal Investments
Topic: Basic questions about selling stocks...
Replies: 7
Views: 654

Re: Basic questions about selling stocks...

Sell it all now. Don't wait for the stocks to recover. The cold hard fact is that you have lost money. Why wait for it to recover? To ease the pain of of recognizing the loss? That is a cognitive defect - a failure of being rational. I can't remember the exact name of the cognitive defect but I am s...
by alex_686
Wed Apr 26, 2017 11:33 am
Forum: Investing - Help with Personal Investments
Topic: Diversifying same-index ETFs
Replies: 12
Views: 315

Re: Diversifying same-index ETFs

I see little need to diversify across different ETFs. You are adding complexity, which is a cost, today. Against some minor hypothetical benefit tomorrow? 1) What happens if a particular company goes under? Hard to imagine, but what would happen if a Vanguard or Fidelity had some massive AIG/Enron/L...
by alex_686
Tue Apr 25, 2017 8:03 pm
Forum: Investing - Help with Personal Investments
Topic: Investors Capturing Returns of All U.S. Equities?
Replies: 19
Views: 1094

Re: Investors Capturing Returns of All U.S. Equities?

I am going to second Valuethinker thinking here. Market structure matters. Sometimes it favors labor, sometimes investors, and sometimes management & founders. The past 10 years have favored management and oligopolies. Not that I am saying this is a good thing for society, but I'd note again th...
by alex_686
Tue Apr 25, 2017 4:38 pm
Forum: Investing - Help with Personal Investments
Topic: Investors Capturing Returns of All U.S. Equities?
Replies: 19
Views: 1094

Re: Investors Capturing Returns of All U.S. Equities?

My thought is I don't understand how this is a new phenomenon. It is a new phenomenon because the number of new companies listing are declining. We are seeing a secular change in how the market operates. Some periods favor big companies, other times small companies, sometimes public, other times pr...
by alex_686
Tue Apr 25, 2017 4:28 pm
Forum: Investing - Theory, News & General
Topic: Thinking in real vs. nominal
Replies: 46
Views: 2895

Re: Thinking in real vs. nominal

For those of you who do your planning strictly in terms of real growth, is the motivation simply that it makes projection easier because it eliminates the variable of inflation? I think in real terms. I discard inflation not because it is easier but because it is more accurate. I can more accuratel...
by alex_686
Tue Apr 25, 2017 1:58 pm
Forum: Personal Finance (Not Investing)
Topic: Shouldn't one's "number" be indexed to the current PE ratio?
Replies: 20
Views: 1387

Re: Shouldn't one's "number" be indexed to the current PE ratio?

No. The PE Ratio by itself is a worthless number. It only gains value when you compare it to another number. The problem is that the PE ratio has the following information baked into it: Current Earnings Expected Growth Expected Inflation Risk Now I start with PE Ratio, then adjust for expected infl...
by alex_686
Tue Apr 25, 2017 1:43 pm
Forum: Investing - Theory, News & General
Topic: Thinking in real vs. nominal
Replies: 46
Views: 2895

Re: Thinking in real vs. nominal

For those of you who do your planning strictly in terms of real growth, is the motivation simply that it makes projection easier because it eliminates the variable of inflation? I think in real terms. I discard inflation not because it is easier but because it is more accurate. I can more accuratel...
by alex_686
Mon Apr 24, 2017 8:38 pm
Forum: Investing - Theory, News & General
Topic: Is AA steady state, or unsteady state?
Replies: 14
Views: 982

Re: Is AA steady state, or unsteady state?

AA should change as your financial situation changes. However it should change slowly. You AA should reflect your goals, your ability to take risk, your willingness to take risk, and your market expectations. Age is a good line of attack. As you get older you human capital falls making most people r...
by alex_686
Mon Apr 24, 2017 1:55 pm
Forum: Investing - Help with Personal Investments
Topic: Rght Bond fund/s when interest rates rise?
Replies: 31
Views: 1946

Re: Rght Bond fund/s when interest rates rise?

I also prefer intermediate funds (both US Treasuries and Corporates) over TBM. My reason is that TBM achieves its 5 year average maturity with a barbell of short and long bonds. I don't want any long bonds. I also like to tune the ratio of corporates to Treasuries. Basically I believe in indexing f...
by alex_686
Mon Apr 24, 2017 12:58 pm
Forum: Investing - Help with Personal Investments
Topic: A few questions about International... VXUS, VEA, VWO... low returns
Replies: 24
Views: 1550

Re: A few questions about International... VXUS, VEA, VWO... low returns

International has preformed badly over the past 10 years. Another way to look at this is that the US has had an exceptional 10 years. Some of this is due to one time events, like the strengthening of the dollar and the fall of the Euro. Also, over the past 10 years the market has favored growth, meg...
by alex_686
Mon Apr 24, 2017 10:00 am
Forum: Investing - Help with Personal Investments
Topic: Why is Real-Estate so Bad?
Replies: 113
Views: 8381

Re: Why is Real-Estate so Bad?

Let me segway a talk about risk adjusted returns. First, when it comes to real estate people have a tendency to underestimate risk and overestimate returns for a variety of psychological reasons. See behavioral economics. Excuse me if I am completely wrong on this (as I said I am still young and try...
by alex_686
Sun Apr 23, 2017 12:03 pm
Forum: Investing - Help with Personal Investments
Topic: Rght Bond fund/s when interest rates rise?
Replies: 31
Views: 1946

Re: Rght Bond fund/s when interest rates rise?

Dear Bogleheads, I am wondering as interest rates rise, if I should be replacing total bond market fund in my portfolio with one or multiple of these: Vanguard Inflation Protected Securites Fund (VIPSX) Vanguard Intermdiate-term Bond Index (VBIIX) Vanguard Short-term Bond Index (VBISX) Thanks! If r...
by alex_686
Sun Apr 23, 2017 9:39 am
Forum: Personal Finance (Not Investing)
Topic: Should some professions tell people how much they make?
Replies: 39
Views: 4777

Re: Should some professions tell people how much they make?

If you think your appearance is an issue, have you tried to do anything about trying to look older? Some ideas: suit and tie, facial hair, shoes with built in heels, dying some hairs gray, don't smile very much and look serious, speak like it's 1957 instead of 2017 (no modern lingo or slang). Anywa...
by alex_686
Fri Apr 21, 2017 4:40 pm
Forum: Investing - Help with Personal Investments
Topic: Investing in Norway, Denmark and Sweden
Replies: 9
Views: 677

Re: Investing in Norway, Denmark and Sweden

Question - why do you think these factors will higher stock returns? I would think off hand that most of the economic activity you are trying to target is in private hands. Further, that the publicly traded companies listed would have most of their economic activity would be out of balanced our out ...
by alex_686
Fri Apr 21, 2017 1:12 pm
Forum: Investing - Theory, News & General
Topic: Bond fund Maturity vs Duration
Replies: 32
Views: 2187

Re: Bond fund Maturity vs Duration

Once a bond is issued the only thing people care about is the maturity date. For example, 3 year treasury futures can be settled with a newly issued 3 year note or either of the 2 bonds you quoted. No expert here. Is this true? It is true. There is good money to be made if you can figure out the ma...
by alex_686
Fri Apr 21, 2017 12:39 pm
Forum: Investing - Theory, News & General
Topic: Bond fund Maturity vs Duration
Replies: 32
Views: 2187

Re: Bond fund Maturity vs Duration

CUSPID: 912828ND8, Term: 10 years. Maturity date: 5/15/2020 (3 years). Coupon: 3.50%. YTM: 1.387% CUSPID: 912828VA5, Term: 7 years. Maturity date: 4/30/2020 (3 years). Coupon: 1.125%. YTM: 1.388% Different term, different coupon, same maturity (within a few days), same YTM. Perhaps the duration is ...
by alex_686
Fri Apr 21, 2017 10:43 am
Forum: Investing - Help with Personal Investments
Topic: Issues with REIT in traditional IRA
Replies: 9
Views: 874

Re: Issues with REIT in traditional IRA

But here is my question......... They will be transferring the certificates - the shares of AFIN. What are the pitfalls, problems, issues, negatives of holding those ourselves? We do not want to get ourselves into a bind, but we also do not want to deal with another rip-off investment house that wi...
by alex_686
Fri Apr 21, 2017 7:08 am
Forum: Investing - Help with Personal Investments
Topic: Keep Mortgaged Home For Rental Property - Equity In ROI?
Replies: 14
Views: 1100

Re: Keep Mortgaged Home For Rental Property - Equity In ROI?

Returns on homes in the long run average are negative, adjusted for quality improvements. That seems to be the conclusion from the Robert Shiller data, and also see "Safe as Houses: 8 centuries of housing prices" by Neil Monnery-- exceptional book compiling international data. Both very e...
by alex_686
Thu Apr 20, 2017 7:29 pm
Forum: Investing - Help with Personal Investments
Topic: Keep Mortgaged Home For Rental Property - Equity In ROI?
Replies: 14
Views: 1100

Re: Keep Mortgaged Home For Rental Property - Equity In ROI?

If it is either of these I would use the 99k for your initial investment number. When modeling future returns you can use these assumptions for your finial terminal value, when you sell the house. I do not know if I am better off taking the cash out from a sale and putting it in an investment accou...
by alex_686
Thu Apr 20, 2017 1:22 pm
Forum: Investing - Help with Personal Investments
Topic: Brand New Investor Help
Replies: 11
Views: 655

Re: Brand New Investor Help

I definitely want this account to be over a long-term, but I really don't know if I want to wait until 59 to be able to withdraw (isnt that the age for IRAs?) That just seems a little long to me, plus I feel like there could be a situation in the future where I would need some emergency funds, and ...
by alex_686
Thu Apr 20, 2017 12:40 pm
Forum: Personal Finance (Not Investing)
Topic: When does it make sense to start paying down (or off) a low rate mortgage?
Replies: 53
Views: 4906

Re: When does it make sense to start paying down (or off) a low rate mortgage?

3) When bond rates are lower than the after-tax cost of your mortgage Number 3 is kind of close to the correct answer. What you want to do is look at your entire portfolio and figure out what the best asset allocation is. Often it is better to add stocks because they will offer a better risk adjust...
by alex_686
Thu Apr 20, 2017 11:46 am
Forum: Investing - Help with Personal Investments
Topic: Keep Mortgaged Home For Rental Property - Equity In ROI?
Replies: 14
Views: 1100

Re: Keep Mortgaged Home For Rental Property - Equity In ROI?

I am flummoxed though on how to consider the equity when calculating rental ROI. Is this a sunk cost that is immaterial? Is the "cost" of starting it as a rental the opportunity cost of not selling the home? I am not entirely sure what question you are asking. Why do you care what the ROI...
by alex_686
Thu Apr 20, 2017 11:19 am
Forum: Investing - Help with Personal Investments
Topic: Investment Advice
Replies: 2
Views: 238

Re: Investment Advice

3 general points. Before you think about asset allocation think about your goals and your risk tolerance, both your ability and williness to take risk. Figure this out and everything else should fall into place. It is generally more tax efficient to have bonds in your tax advantage accounts (a.k.a. ...
by alex_686
Thu Apr 20, 2017 10:58 am
Forum: Investing - Help with Personal Investments
Topic: Small investment in IPO at Loyal3
Replies: 1
Views: 169

Re: Small investment in IPO at Loyal3

Yes. This seems pretty straightforward.
by alex_686
Thu Apr 20, 2017 10:39 am
Forum: Investing - Help with Personal Investments
Topic: Brand New Investor Help
Replies: 11
Views: 655

Re: Brand New Investor Help

Hey I just turned 18 and have been wanting to invest for awhile. I've been doing some research around and was thinking about investing my $3000 into a portfolio with Vanguard. I was thinking 80/20 Stocks to bonds. With 50% in VTI, 20% in VXUS, 20% in BND and 10% in VOT. I'm not very knowledgeable a...
by alex_686
Thu Apr 20, 2017 10:07 am
Forum: Investing - Theory, News & General
Topic: Bond fund Maturity vs Duration
Replies: 32
Views: 2187

Re: Bond fund Maturity vs Duration

Well, not exactly. :) If interest rates drop then prepayment and refinancing is likely, but if interest rates rise it isn't. So it's an asymmetric risk, which can't be captured by a single number. More generally, the duration only gives the sensitivity of the bond price to a very small change in in...
by alex_686
Wed Apr 19, 2017 9:23 pm
Forum: Investing - Theory, News & General
Topic: Bond fund Maturity vs Duration
Replies: 32
Views: 2187

Re: Bond fund Maturity vs Duration

Yes, I picked the wrong Fidelity fund to properly match VBTLX but I stumbled upon one that demonstrates duration is not the whole risk story, perhaps not even the biggest part of the story. If I recall correctly, duration explains about 80% of returns for government bonds and 70% for corporate. Ano...
by alex_686
Wed Apr 19, 2017 5:59 pm
Forum: Investing - Help with Personal Investments
Topic: Quick Dividend Automatic Reinvesting Question
Replies: 6
Views: 688

Re: Quick Dividend Automatic Reinvesting Question

Focus on Total Return as a percentage. Ignoring taxes, it does matter if that return comes from dividends or capital appreciation. It certainly does not matter how many extra shares you have. Now your situation is working off of the S&P index, and the index is a little bit nonsensical. The S&...
by alex_686
Wed Apr 19, 2017 3:38 pm
Forum: Investing - Help with Personal Investments
Topic: wealthfront and tax loss harvesting
Replies: 13
Views: 879

Re: wealthfront and tax loss harvesting

I'm not following. Taking losses now generates more capital gains in the future. Unless your CG rate in the future is higher, then there's no benefit. Taking losses against ordinary income is an immediate and probable future benefit. You are correct. It is better to take tax gains today and reinves...
by alex_686
Wed Apr 19, 2017 2:54 pm
Forum: Investing - Theory, News & General
Topic: Bond fund Maturity vs Duration
Replies: 32
Views: 2187

Re: Bond fund Maturity vs Duration

Especially with mortgage related bonds, prepayment can be a significant contributor to the lower duration vs maturity. So that risk is already baked into the duration? Kind of the other way around. Modified Duration is a measure of risk. So not so much as "baked in" but a "representa...
by alex_686
Wed Apr 19, 2017 2:20 pm
Forum: Investing - Theory, News & General
Topic: Bond fund Maturity vs Duration
Replies: 32
Views: 2187

Re: Bond fund Maturity vs Duration

The duration is intended to represent what maturity (if issued today) the bond in question would need to make it equivalent to other newly-issued bonds with the same coupon. No. It is mainly used as a risk measure. Duration and maturity are the same only for zero coupon bonds and it is next to impo...
by alex_686
Wed Apr 19, 2017 1:01 pm
Forum: Investing - Help with Personal Investments
Topic: wealthfront and tax loss harvesting
Replies: 13
Views: 879

Re: wealthfront and tax loss harvesting

The goal is to reduce you capital gain taxes when you cash out of your account. No, that isn't the general goal. For the most part, you want to take tax losses now against ordinary income by increasing your capital gains in future years. It depends on the size of the account and one time frame. One...

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