Search found 4966 matches

by lack_ey
Thu Feb 23, 2017 11:09 pm
Forum: Investing - Help with Personal Investments
Topic: which bond fund?
Replies: 5
Views: 244

Re: which bond fund?

If nothing else the TIPS should be fine. If you have a heavy equity allocation and retirement is a ways away, some of the long-term government bond index isn't bad either. What rate is Laddered Fixed Income GSAM SV paying out? That could be a good choice. Actually, the three costing around 0.4% may ...
by lack_ey
Thu Feb 23, 2017 9:45 pm
Forum: Investing - Theory, News & General
Topic: Extreme Valuations, and why you should reconsider
Replies: 139
Views: 7434

Re: Extreme Valuations, and why you should reconsider

re: qualified dividends, domestic and international funds Isn't that just how it is? You see it in the tax docs at the fund companies every year, e.g. https://advisors.vanguard.com/VGApp/iip/advisor/csa/investments/taxcenter http://www.bosinvest.com/wp-content/uploads/2017/02/Dimensional-Tax-Sheets_...
by lack_ey
Thu Feb 23, 2017 9:09 pm
Forum: Investing - Theory, News & General
Topic: Why has growth beaten value recently?
Replies: 19
Views: 1955

Re: Why has growth beaten value recently?

First of all, this thread is from 2016. Value had a comeback recently. Really? Vanguard Value Index (VIVAX) 10 year return: 6.02% Vanguard Growth Index (VIGRX) 10 year return: 8.38% Their 15 year returns are virtually tied at 7.81% vs 7.25% respectively. I wasn't suggesting that the 10-year differe...
by lack_ey
Thu Feb 23, 2017 6:32 pm
Forum: Investing - Theory, News & General
Topic: Is a 4% plus CPI withdrawal rate actually aggressive?
Replies: 232
Views: 9663

Re: Is a 4% plus CPI withdrawal rate actually aggressive?

I was asking whether it has the same problems CAPE has as per lack-ey and those 3 lengtheeeey article he cited. P.S, this problem "There are a lot of problems here, one of which is that by training a model on all historical data, you have fitted to the past and have not validated or tested on ...
by lack_ey
Thu Feb 23, 2017 5:50 pm
Forum: Investing - Theory, News & General
Topic: Is a 4% plus CPI withdrawal rate actually aggressive?
Replies: 232
Views: 9663

Re: Is a 4% plus CPI withdrawal rate actually aggressive?

I'm stating that no one knows enough to create a good model that can predict the future. I think that is very likely. At best, we can only explain about 40% of future returns, and only 10 years or 18 years into the future (nominal and real returns, respectively) then. This means that the rest of th...
by lack_ey
Thu Feb 23, 2017 5:10 pm
Forum: Investing - Theory, News & General
Topic: Is a 4% plus CPI withdrawal rate actually aggressive?
Replies: 232
Views: 9663

Re: Is a 4% plus CPI withdrawal rate actually aggressive?

I'm stating that no one knows enough to create a good model that can predict the future. I think that is very likely. At best, we can only explain about 40% of future returns, and only 10 years or 18 years into the future (nominal and real returns, respectively) then. This means that the rest of th...
by lack_ey
Thu Feb 23, 2017 5:05 pm
Forum: Investing - Theory, News & General
Topic: Why has growth beaten value recently?
Replies: 19
Views: 1955

Re: Why has growth beaten value recently?

First of all, this thread is from 2016. Value had a comeback recently. Don't "growth" and "value" over very long time frames like 50 years tend to perform very similarly but sometimes one or the other excels for as many as 10 or more years at a time? Perhaps sensitive to market c...
by lack_ey
Thu Feb 23, 2017 3:19 pm
Forum: Investing - Help with Personal Investments
Topic: Stay in cash until rates rise?
Replies: 27
Views: 2165

Re: Stay in cash until rates rise?

For sure, if you can market time the longer-term rates (I mean 1+ years, the rates on the bonds that bond funds hold), then do it, at least to some degree. By that I mean reducing duration, maybe not necessarily completely to cash. Position sizing is an important part of more active investing—you ne...
by lack_ey
Thu Feb 23, 2017 1:29 pm
Forum: Investing - Theory, News & General
Topic: Is a 4% plus CPI withdrawal rate actually aggressive?
Replies: 232
Views: 9663

Re: Is a 4% plus CPI withdrawal rate actually aggressive?

Sure that makes sense, but no one even knows if the stock market is a normal distribution. Dropping the mean doesn't necessarily mean the standard distribution end-points will move the same amount. If you admit the distribution may not be normal, if anything this might mean fatter tails, greater un...
by lack_ey
Thu Feb 23, 2017 12:34 pm
Forum: Investing - Theory, News & General
Topic: Extreme Valuations, and why you should reconsider
Replies: 139
Views: 7434

Re: Extreme Valuations, and why you should reconsider

International has not once done better than the US when the US has a down market. 2002 Total US: -23.21% Total Int: -18.10% That said, yes it's rare. But it means little, as they're both equities and are going to be somewhat correlated. Year S&P 500 EAFE 1974 -26.5 -23.2 1977 -7.2 18.1 1978 6.6...
by lack_ey
Thu Feb 23, 2017 11:55 am
Forum: Investing - Help with Personal Investments
Topic: VBILX vs VBTLX [Vanguard Intermediate-Term vs. Total Bond]
Replies: 31
Views: 2432

Re: VBILX vs VBTLX [Vanguard Intermediate-Term vs. Total Bond]

This is a good summary of the issue from Larry Swedroe: http://www.etf.com/sections/index-investor-corner/swedroe-reconsidering-corporate-bonds?nopaging=1 Basically corporates have either underperformed or only outperformed by a bit and that is before state and local tax benefits of treasuries or t...
by lack_ey
Thu Feb 23, 2017 11:44 am
Forum: Investing - Theory, News & General
Topic: Is a 4% plus CPI withdrawal rate actually aggressive?
Replies: 232
Views: 9663

Re: Is a 4% plus CPI withdrawal rate actually aggressive?

"Assuming a 0% real return is possible over 30 years is pretty pessimistic (You're basically planning for the next 30 years being the worst 30 years in modern history - worse than the Great Depression)." I am admittedly and certainly nowhere near an expert on any of this subject matter - ...
by lack_ey
Thu Feb 23, 2017 11:14 am
Forum: Investing - Theory, News & General
Topic: Extreme Valuations, and why you should reconsider
Replies: 139
Views: 7434

Re: Extreme Valuations, and why you should reconsider

This is backtesting. He didn't predict 10%-13% back in 2010. He predicted less than 4.5% in November 2010. http://www.hussmanfunds.com/wmc/wmc101108.htm Our projection for the total return of the S&P 500 over the coming decade is now less than 4.5% annually In 2010, he played around with differ...
by lack_ey
Thu Feb 23, 2017 2:29 am
Forum: Investing - Theory, News & General
Topic: Extreme Valuations, and why you should reconsider
Replies: 139
Views: 7434

Re: Extreme Valuations, and why you should reconsider

FWIW, in January 2000 the CAPE 10 was forecasting a real return to US stocks of 2.3%, it has been 3%. I'd say that was a very good prediction. Larry Out of curiosity, does that include dividends? Yeah, nominal total return about 5.1% annualized, with about 2.1% inflation. Note that this happened de...
by lack_ey
Wed Feb 22, 2017 8:46 pm
Forum: Investing - Help with Personal Investments
Topic: VBILX vs VBTLX [Vanguard Intermediate-Term vs. Total Bond]
Replies: 31
Views: 2432

Re: VBILX vs VBTLX [Vanguard Intermediate-Term vs. Total Bond]

The premium you get historically for coporate bonds is minuscule for the risk. Since bonds are for safety use intermediate term treasuries. Evidence shows that is the sweet spot for return and safety. Are you going to lose a bunch in a diversified bond fund with corporates and MBS? Most likely no b...
by lack_ey
Wed Feb 22, 2017 4:17 pm
Forum: Investing - Help with Personal Investments
Topic: VTSAX vs FSTVX
Replies: 10
Views: 600

Re: VTSAX vs FSTVX

Share price is completely irrelevant. You don't even transact in whole numbers of shares anyway. What we have here is just that one fund contains about 26% more assets than the other per share. But the same per dollar so who cares? The discrepancy arises from different fund inception dates, maybe di...
by lack_ey
Wed Feb 22, 2017 11:42 am
Forum: Investing - Help with Personal Investments
Topic: "High conviction investing"
Replies: 26
Views: 1328

Re: "High conviction investing"

With regard to Invesco, one thing that came out of that last exercise. I've convinced myself that, as used by Invesco, "high-conviction" is a completely empty marketing term . They actually call out, by name, two of their :?: :?: :?: :!: :!: :!: index ETFs :!: :!: :!: :?: :?: :?: as "...
by lack_ey
Wed Feb 22, 2017 3:39 am
Forum: Investing - Theory, News & General
Topic: Extreme Valuations, and why you should reconsider
Replies: 139
Views: 7434

Re: Extreme Valuations, and why you should reconsider

... If the permabear HUssman is so confident (including the timing for crash) how have his funds trailed so badly? Is he not able to short aggressively in his funds? or does he just talk but not actually follow through?... He short sells the market very aggressively. Hussman Strategic Growth HSGFX ...
by lack_ey
Tue Feb 21, 2017 8:17 pm
Forum: Investing - Help with Personal Investments
Topic: "High conviction investing"
Replies: 26
Views: 1328

Re: "High conviction investing"

FWIW if you search "high conviction active" this will turn up a lot. This perhaps ties in with since-debunked ideas about active share. The funds with higher active share are higher conviction, probably. It also ties in with the idea of manager investment in her/her own fund. Presumably th...
by lack_ey
Tue Feb 21, 2017 8:11 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 131
Views: 6272

Re: 20% bonds: why bother at 48?

Not sure if it's in this thread, but I don't usually see anyone citing that 80/20 produces higher expected return than 100/0. I do often see posts claiming it is a higher "risk adjusted" return or the optimal point on the "efficient frontier." Historically 80/20 is not even clos...
by lack_ey
Tue Feb 21, 2017 7:47 pm
Forum: Investing - Help with Personal Investments
Topic: 403(b) "Fixed Return of 7%" Election Question
Replies: 24
Views: 1284

Re: 403(b) "Fixed Return of 7%" Election Question

Oh, there are plenty of people/institutions who think 7% nominal is more than the stock market—never mind bonds—will return for a while (on average, or in the most likely scenario, or something like that... obviously a wide range of outcomes is possible), including Bogle himself, many of the Boglehe...
by lack_ey
Tue Feb 21, 2017 7:36 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 131
Views: 6272

Re: 20% bonds: why bother at 48?

I don't know why people insist so strongly on 20% bonds, though, based on some notion of bear market performance and maybe a rebalancing bonus, implying that the expected return differential with 100% stocks is minuscule or even negative. Where do you think that was said? I wonder if you are talkin...
by lack_ey
Tue Feb 21, 2017 7:31 pm
Forum: Investing - Help with Personal Investments
Topic: VBILX vs VBTLX [Vanguard Intermediate-Term vs. Total Bond]
Replies: 31
Views: 2432

Re: VBILX vs VBTLX [Vanguard Intermediate-Term vs. Total Bond]

I struggled with the same question. I think that in 20+ years the difference in your portfolio using one vs the other will be minimal and no way to tell which will be "better". However, a choice needs to be made and I opted for VBILX. I was leaning this way because VBTLX has a high percen...
by lack_ey
Tue Feb 21, 2017 6:44 pm
Forum: Investing - Theory, News & General
Topic: Theory question about value/size tilts
Replies: 7
Views: 392

Re: Theory question about value/size tilts

...Also note as always that in real funds as opposed to raw data, small growth is not as bad historically because index inclusion screens (and active manager picks) weed out a lot of the worst stuff on average... That's very interesting, lack_ey. I've certainly been bemused by the lack of any drama...
by lack_ey
Tue Feb 21, 2017 6:06 pm
Forum: Investing - Theory, News & General
Topic: Extreme Valuations, and why you should reconsider
Replies: 139
Views: 7434

Re: Extreme Valuations, and why you should reconsider

All I know is... If you have a model (CAPE) that was built on 70 years of data, and then for the next 25 years straight the data doesn't match the model, I don't think it's unreasonable to wonder if the model is no longer accurate. If maybe, just maybe, there are more variables involved that weren'...
by lack_ey
Tue Feb 21, 2017 5:21 pm
Forum: Investing - Theory, News & General
Topic: Theory question about value/size tilts
Replies: 7
Views: 392

Re: Theory question about value/size tilts

Keep in mind that the value exposure (factor loading) of large value is not necessarily the same as the value exposure of small value, and so on. It's not quite that simple, even before assuming that there are interaction effects and nonlinearities for the factors. By the way, if you're backtesting ...
by lack_ey
Tue Feb 21, 2017 5:11 pm
Forum: Investing - Theory, News & General
Topic: Extreme Valuations, and why you should reconsider
Replies: 139
Views: 7434

Re: Extreme Valuations, and why you should reconsider

Hi Aloha Joe - I don't base all of my decisions on Hussman. I base on valuations - which is why I have been at my normal allocation until recently. I mean seriously Aloha - 1929 and 1999 valuations, with huge policy uncertaintly not priced in. And you want to continue to not take "SOME" o...
by lack_ey
Tue Feb 21, 2017 4:38 pm
Forum: Investing - Help with Personal Investments
Topic: Bonds bad in ROTH? Infographic:
Replies: 8
Views: 445

Re: Bonds bad in ROTH? Infographic:

With interest rates relatively low, the tax on dividends for a stock fund plus the capital gains tax on eventual sale may be a bigger deal than the tax on bond fund dividends (which is at the marginal rate), even though long-term capital gains and qualified stock dividends have preferential treatmen...
by lack_ey
Tue Feb 21, 2017 4:04 pm
Forum: Personal Consumer Issues
Topic: Desktop Computer - Still relevant? Good investment?
Replies: 66
Views: 4423

Re: Desktop Computer - Still relevant? Good investment?

"ATX" means a full size tower case? If so then would having an ATX case mean you could reuse it to build a new system whenever you decide you need a "new computer"? Yes. Some cases boast newer features (external hookups for USB, etc.) but my husband and I have been using the sam...
by lack_ey
Tue Feb 21, 2017 3:34 pm
Forum: Investing - Help with Personal Investments
Topic: "High conviction investing"
Replies: 26
Views: 1328

Re: "High conviction investing"

In an investing context it's usually meant to mean conviction in certain active views. Parts of the market, strategies, and so on. For Invesco specifically it's unambiguous because they have a portal on their site about that: https://www.invesco.com/portal/site/hc Keep in mind it's not all tradition...
by lack_ey
Tue Feb 21, 2017 3:08 pm
Forum: Investing - Theory, News & General
Topic: Why TBM (total bond market)?
Replies: 17
Views: 2093

Re: Why TBM (total bond market)?

The whole portfolio is the thing. You shouldn't obsess over pieces in isolation. Bonds are just a separate source of total returns from stocks, being driven by significantly different forces. You can combine a number of assets to construct an overall asset allocation and the properties of the whole ...
by lack_ey
Tue Feb 21, 2017 2:29 pm
Forum: Investing - Theory, News & General
Topic: Is a 4% plus CPI withdrawal rate actually aggressive?
Replies: 232
Views: 9663

Re: Is a 4% plus CPI withdrawal rate actually aggressive?

btw one caution when looking at mortality tables, survival probabilities, etc. is that outcomes are dependent on a number of factors and the probabilities conditioned on your circumstances may be higher than actuarial tables suggest (or lower, depending). Life expectancy is notably higher among the ...
by lack_ey
Tue Feb 21, 2017 1:53 pm
Forum: Investing - Theory, News & General
Topic: Is a 4% plus CPI withdrawal rate actually aggressive?
Replies: 232
Views: 9663

Re: Is a 4% plus CPI withdrawal rate actually aggressive?

Actually likely better are (single premium) deferred annuities purchased ahead of time, for mortality credits. SPIAs also okay. A lot of the Pfau et al stuff looks at using annuities in conjunction with stocks and bonds. In practice, particularly in withdrawal scenarios where it's close (where the v...
by lack_ey
Tue Feb 21, 2017 1:34 pm
Forum: Investing - Help with Personal Investments
Topic: Short-Term Government Bond Index (VSBSX) tax question
Replies: 4
Views: 209

Re: Short-Term Government Bond Index (VSBSX) tax question

Then my next question is: Does Vanguard publish what percentage of VSBSX's recent dividends are exempt from state tax? I wasn't able to find that information anywhere and I don't see how one can determine its after-tax yield without it. Tax information for Vanguard funds page: https://personal.vang...
by lack_ey
Tue Feb 21, 2017 1:01 pm
Forum: Investing - Help with Personal Investments
Topic: Short-Term Government Bond Index (VSBSX) tax question
Replies: 4
Views: 209

Re: Short-Term Government Bond Index (VSBSX) tax question

The fund isn't paying the tax. That's a standard-convention illustration based on what a hypothetical investor would get after federal taxes if said hypothetical investor was in the highest tax bracket. State and local taxes are not considered. Also, keep in mind that tax is based on fund distributi...
by lack_ey
Tue Feb 21, 2017 12:55 pm
Forum: Investing - Help with Personal Investments
Topic: Have to hold bond fund in Taxable account-how to buy
Replies: 8
Views: 380

Re: Have to hold bond fund in Taxable account-how to buy

If you're in a higher tax bracket, consider muni bonds rather than taxable bonds. You already have government, corporate, MBS exposure in your taxa-advantaged accounts so you're still well diversified in fixed income. (If you somehow have tax-advantaged accounts topped out and way too much outside w...
by lack_ey
Tue Feb 21, 2017 12:46 pm
Forum: Investing - Theory, News & General
Topic: Extreme Valuations, and why you should reconsider
Replies: 139
Views: 7434

Re: Extreme Valuations, and why you should reconsider

I've tempered by return expectations, basically excepting lower returns for lower volatility - by moving into 40% stocks, and 60% VBISX Short Term Bond Index (Inflation Hedge). Wait, how are 1-5 yr maturity nominal bonds an inflation hedge? Relative to long-term nominal bonds they likely wouldn't b...
by lack_ey
Tue Feb 21, 2017 12:35 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 131
Views: 6272

Re: 20% bonds: why bother at 48?

I don't know why people insist so strongly on 20% bonds, though, based on some notion of bear market performance and maybe a rebalancing bonus, implying that the expected return differential with 100% stocks is minuscule or even negative. That's not how it works over most periods of time—if the fut...
by lack_ey
Tue Feb 21, 2017 11:55 am
Forum: Personal Consumer Issues
Topic: Desktop Computer - Still relevant? Good investment?
Replies: 66
Views: 4423

Re: Desktop Computer - Still relevant? Good investment?

Desktops last longer than laptops, but they end up using a TON more electricity. Fun fact: if you keep a desktop computer for more than 4 years you'll spend more on electricity than on buying it! Wow! I have been researching power supplies, it seems they come in various levels of energy efficiency....
by lack_ey
Tue Feb 21, 2017 11:23 am
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 131
Views: 6272

Re: 20% bonds: why bother at 48?

I don't know why people insist so strongly on 20% bonds, though, based on some notion of bear market performance and maybe a rebalancing bonus, implying that the expected return differential with 100% stocks is minuscule or even negative. That's not how it works over most periods of time—if the futu...
by lack_ey
Tue Feb 21, 2017 11:16 am
Forum: Investing - Theory, News & General
Topic: Extreme Valuations, and why you should reconsider
Replies: 139
Views: 7434

Re: Extreme Valuations, and why you should reconsider

In 2011 expected 10 year average annual return was around 10% per year for any new money invested during that year. See 3rd chart down on link below. 4 other valuation metrics are similar...its not just his model..I ran into his model after doing my own modeling and being baffled at the prices I wa...
by lack_ey
Tue Feb 21, 2017 3:34 am
Forum: Investing - Help with Personal Investments
Topic: Long term treasury ? Pros and Cons
Replies: 15
Views: 960

Re: Long term treasury ? Pros and Cons

I agree w/Dancer - I see the appeal of long bonds to hedge downturns, but you can barbell and get some of each: short bonds that will hold up to inflation and long bonds that will help with deflation, all at an average duration that is somewhat more reasonable than just long bonds. I personally sti...
by lack_ey
Tue Feb 21, 2017 12:34 am
Forum: Personal Consumer Issues
Topic: Desktop Computer - Still relevant? Good investment?
Replies: 66
Views: 4423

Re: Desktop Computer - Still relevant? Good investment?

Every modern computer not running some ultra-low-power, low-cost processor will feel fast and breeze through most anything you throw at it, except (1) loading stuff, in which case it's the storage drive that's the bottleneck and what matters most is if there's solid-state storage or not (2) actually...
by lack_ey
Tue Feb 21, 2017 12:16 am
Forum: Investing - Help with Personal Investments
Topic: What to do with Gold?
Replies: 12
Views: 1101

Re: What to do with Gold?

In holding that gold in an ETF you run into a problem called contango . Look that up and see if you still want to hold it in that manner. I would feel different if you had physical gold but you can't win with etf 's. According to their websites, both ETFs OP mentions, the SPDR Gold Trust , GLD, and...
by lack_ey
Mon Feb 20, 2017 8:47 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 131
Views: 6272

Re: 20% bonds: why bother at 48?

A lot of those things shouldn't really be ultra-long-term issues. But may be a problem in your given timeframe. You are right that when you scale up to the whole economy, you have to think differently from household equations. Net savings = net investment and all those identities. But over a given p...
by lack_ey
Mon Feb 20, 2017 8:27 pm
Forum: Investing - Help with Personal Investments
Topic: VBILX vs VBTLX [Vanguard Intermediate-Term vs. Total Bond]
Replies: 31
Views: 2432

Re: VBILX vs VBTLX

The intermediate-term fund takes a bit more term and credit risk, and it doesn't have MBS, but for actual returns and risk you're probably not really going to notice the difference. So maybe the riskier fund is slightly better? Of course, you can extend this argument indefinitely (slightly more retu...
by lack_ey
Mon Feb 20, 2017 8:10 pm
Forum: Investing - Theory, News & General
Topic: Is a 4% plus CPI withdrawal rate actually aggressive?
Replies: 232
Views: 9663

Re: Is a 4% plus CPI withdrawal rate actually aggressive?

I think 4% plus CPI is too conservative especially for anyone with meaningful levels of other income sources such that they can handle some income variation. And If one can't handle any variation, one has to wonder why someone is retiring on the bleeding edge of covering the basics. 5% of a 70/30 a...
by lack_ey
Mon Feb 20, 2017 7:45 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 131
Views: 6272

Re: 20% bonds: why bother at 48?

The two main things are But much worse would be Scenario B. Could well be worse than that long term, as seen in some of countries, even outside occupation/WWII. In Italy the last 50+ years, bonds have broadly outpaced stocks, for example. lack_ey I always like your thoughtful posts. I have a questi...
by lack_ey
Mon Feb 20, 2017 4:24 pm
Forum: Investing - Help with Personal Investments
Topic: 20% bonds: why bother at 48?
Replies: 131
Views: 6272

Re: 20% bonds: why bother at 48?

The two main things are 1. You don't actually know your investing horizon and thus can't really match investments to actual liabilities (could be a lot shorter than you think for some money). It's not like you know how large of an emergency fund you'll ever need so personally I don't segregate out a...
by lack_ey
Mon Feb 20, 2017 3:01 pm
Forum: Investing - Theory, News & General
Topic: Is a 4% plus CPI withdrawal rate actually aggressive?
Replies: 232
Views: 9663

Re: Is a 4% plus CPI withdrawal rate actually aggressive?

If there are different regimes then by sampling the past over those different conditions you're not really getting information about the current or future regime, at least definitely not in a way where the most simple statistics just cited for sample error and so on. That's not really n=8, in any ca...

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