Search found 3221 matches

by stlutz
Sat Sep 17, 2016 3:43 pm
Forum: Investing - Help with Personal Investments
Topic: I messed up.. [Transfer-in-kind]
Replies: 56
Views: 2745

Re: I messed up.. [Transfer-in-kind]

Fidelity charges $0 to sell mutual funds. You could then invest in their super-low-cost index funds. Or use ETFs.
by stlutz
Sat Sep 17, 2016 12:04 pm
Forum: Investing - Theory, News & General
Topic: The coming municipal bond crisis
Replies: 50
Views: 6760

Re: The coming municipal bond crisis

The problem applies to all governments. The degree of the problem depends on what actual market returns are vs. what they using as the "expected" rate of return. That's unknowable now. Muni bonds are not risk-free instruments and should not be treated as such. They are usually very low ris...
by stlutz
Sat Sep 17, 2016 12:47 am
Forum: Investing - Help with Personal Investments
Topic: SCHR vs CD [Schwab Intermediate-Term US Trs]
Replies: 5
Views: 467

Re: SCHR vs CD [Schwab Intermediate-Term US Trs]

I compare the CD to a Treasury note with approximately the same maturity date.
by stlutz
Fri Sep 16, 2016 6:03 pm
Forum: Investing - Help with Personal Investments
Topic: SCHR vs CD [Schwab Intermediate-Term US Trs]
Replies: 5
Views: 467

Re: SCHR vs CD [Schwab Intermediate-Term US Trs]

With an equity-heavy portfolio, Treasuries are very much a good bet for your bond allocation. They will have lower equity correlation than corporate bonds will, which is helpful in a buy-hold-rebalance portfolio. Brokered CDs should be looked as as individual bonds with the par value guaranteed by t...
by stlutz
Fri Sep 16, 2016 1:51 am
Forum: Investing - Theory, News & General
Topic: Why is the effective maturity in Vanguard Total Bond Market bimodal?
Replies: 7
Views: 614

Re: Why is the effective maturity in Vanguard Total Bond Market bimodal?

The above comments about corporate bonds may be right, but Treasuries drive an awful lot of this. From 2001 to 2006, the Treasury wasn't issuing 30 year bonds. And during the late 90s the government wasn't issuing a lot of new debt at all. As a result, there just isn't a lot of Treasury debt with ma...
by stlutz
Mon Sep 12, 2016 12:17 am
Forum: Investing - Theory, News & General
Topic: An "out of sample" test of two specific factor-based portfolios published pre-2008
Replies: 76
Views: 4973

Re: An "out of sample" test of two specific factor-based portfolios published pre-2008

In response to the discussion about the longer duration of Total Bond, you can take nisi's link and adjust the bond allocation and switch to short-term bonds. The result is that the 3 funder has a slightly lower return than the other two but still a higher Sharpe ratio. It is worth noting that the u...
by stlutz
Sun Sep 11, 2016 10:13 am
Forum: Investing - Help with Personal Investments
Topic: Advice for ETF buying at Schwab
Replies: 13
Views: 928

Re: Advice for ETF buying at Schwab

You're making this way too complicated 1. Try to keep premiums at no more than 0.1%-1% above NAV Fact is, you don't know what the NAV is/should be at any given point in time. How do you value Hong Kong securities which don't trade at all when the US market is open and you're placing your ETF trade? ...
by stlutz
Fri Sep 09, 2016 11:10 pm
Forum: Investing - Theory, News & General
Topic: Those with negative yields on international bonds take heart
Replies: 69
Views: 5059

Re: Those with negative yields on international bonds take heart

Negative rates in other countries has created a situation where it's very expensive for people in those countries to hedge their exposure to US Dollars while US investors can actually get paid to hedge their positions in other currencies. The result is that US Treasuries end up providing negative yi...
by stlutz
Fri Sep 09, 2016 12:06 am
Forum: Investing - Theory, News & General
Topic: Vanguard brokerage will not convert mutual fund to ETF
Replies: 57
Views: 4044

Re: Vanguard brokerage will not convert mutual fund to ETF

The Good: I realized there was a different number to call 1-800-499-9829. The call was answered quickly, by a very professional rep who immediately understood what I wanted, confirmed that VSCSX to VCSH is allowed (not one of the four disallowed bond funds), quickly did what they needed to do on th...
by stlutz
Thu Sep 08, 2016 11:42 pm
Forum: Investing - Help with Personal Investments
Topic: Early retirement - #'s too close for comfort?
Replies: 26
Views: 3509

Re: Early retirement - #'s too close for comfort?

I would suggest you read carefully on how ACA subsidies work (both the subsidies for insurance and the cost sharing subsidies). I'm not clear on where all of the income will be coming from that prevents you from getting a bigger subsidy. Remember that the subsidies decline with increasing income, so...
by stlutz
Wed Sep 07, 2016 6:25 pm
Forum: Investing - Help with Personal Investments
Topic: Debating Fidelity BrokerageLink for short bond exposure
Replies: 7
Views: 414

Re: Debating Fidelity BrokerageLink for short bond exposure

Why not use the Total Bond Index Fund (FSTIX) at .05% with a duration in the 5s? That seems more sensible than FGOVX in any case.
by stlutz
Wed Sep 07, 2016 1:16 am
Forum: Personal Finance (Not Investing)
Topic: Need Advice... Girlfriend and I are looking to buy our first home in Denver (super hot seller's market)
Replies: 80
Views: 4920

Re: Need Advice... Girlfriend and I are looking to buy our first home in Denver (super hot seller's market)

How much homebuilding is going on in the Denver area? Not perceptions but actual data? And how does that compare the number of people moving into the area? Ultimately prices will depend on supply and demand--if supply isn't keeping up with demand and isn't going to, then prices will get more reasona...
by stlutz
Tue Sep 06, 2016 2:27 pm
Forum: Investing - Theory, News & General
Topic: Vanguard brokerage will not convert mutual fund to ETF
Replies: 57
Views: 4044

Re: Vanguard brokerage will not convert mutual fund to ETF

Call back and talk to somebody different. Converting to ETF is in general unusual so I'm guessing many reps. have never done it
by stlutz
Mon Sep 05, 2016 9:37 pm
Forum: Investing - Help with Personal Investments
Topic: Got [a bad deal] on muni bonds
Replies: 66
Views: 5373

Re: Got [a bad deal] on muni bonds

I just went by what Suzi Orman said which was don't buy muni bond funds because of all the hidden fees, but do buy individual bonds instead. There are low-cost bond funds and high-cost bond funds. Yes, paying a management of 1% for a muni bond fund really adds up over time. Vanguard charges .12%/yr...
by stlutz
Mon Sep 05, 2016 9:33 pm
Forum: Investing - Help with Personal Investments
Topic: Got [a bad deal] on muni bonds
Replies: 66
Views: 5373

Re: Got [a bad deal] on muni bonds

I find it interesting that from the many responses from my post, no one has a clear answer about how muni bonds work. Aside from taxation, there is nothing super-special about how a muni bond works vs. any other bond. But let's take a look at a few things on one particular muni bond to bring a numb...
by stlutz
Mon Sep 05, 2016 3:36 pm
Forum: Investing - Theory, News & General
Topic: Value vs Growth - Depends on the Turnover Frequency?
Replies: 34
Views: 2072

Re: Value vs Growth - Depends on the Turnover Frequency?

Finally had a chance to go back and actually read the papers that bjr listed in the original post. As I read it, the second paper does not actually say what the article in Investing Daily says it says. It does not argue that growth stocks do better with longer holding periods. It is really focused m...
by stlutz
Sun Sep 04, 2016 4:21 pm
Forum: Investing - Theory, News & General
Topic: Scottrade two-factor authentication
Replies: 4
Views: 485

Re: Scottrade two-factor authentication

Personally I would worry more about what happens when you: --Call the brokerage and tell them you forgot your password --Call the brokerage and tell them you lost your security token (or you got a new phone and have a new credential ID) --Call the brokerage and tell them you forgot your username --C...
by stlutz
Fri Sep 02, 2016 11:47 pm
Forum: Investing - Theory, News & General
Topic: TIPS - Did you give up?
Replies: 390
Views: 42793

Re: TIPS - Did you give up?

there have been several comments that TIPS help reduce risk/volatility/standard deviation. I'm sure this varies a little based on your specific portfolio, but.... I see the opposite. I use Portfolio Visualizer to build my portfolio. I then compare it to the same portfolio, but with TIPS instead of ...
by stlutz
Fri Sep 02, 2016 7:17 pm
Forum: Investing - Help with Personal Investments
Topic: Got [a bad deal] on muni bonds
Replies: 66
Views: 5373

Re: Got [a bad deal] on muni bonds

OP seems to acknowledge in his post above that, what he thought was a commission, was actually purchasing the bonds at a premium. The OP still expouses a belief that got taken advantage of. Buying a bond at a premium is not a bad thing--it just means you get a higher coupon payment in exchange for ...
by stlutz
Fri Sep 02, 2016 6:13 pm
Forum: Investing - Help with Personal Investments
Topic: Got [a bad deal] on muni bonds
Replies: 66
Views: 5373

Re: Got [a bad deal] on muni bonds

'm almost 66 and wanted to invest in some 1-3 year muni bonds with Merrill Edge and found out it cost me $2100.00 in commissions which pretty much made the bonds worthless. How did you determine that you paid $2100 in commissions? Their website (https://www.merrilledge.com/pricing) indicates that t...
by stlutz
Fri Sep 02, 2016 12:47 am
Forum: Investing - Theory, News & General
Topic: Value vs Growth - Depends on the Turnover Frequency?
Replies: 34
Views: 2072

Re: Value vs Growth - Depends on the Turnover Frequency?

The Fama/French LV series in 1932 had 34 stocks. Large Growth had 151. Of course large-value was more volatile in that case. And, of course, if I take the smallest 10% of the market it would be more volatile than the other 90%. The problem is, both measures are simply telling you that a less diversi...
by stlutz
Thu Sep 01, 2016 10:21 pm
Forum: Investing - Theory, News & General
Topic: Value vs Growth - Depends on the Turnover Frequency?
Replies: 34
Views: 2072

Re: Value vs Growth - Depends on the Turnover Frequency?

I feel like Dorothy after riding the house through the storm and tornado only to wind up in the Land of Oz. This completely turns over the way I have been thinking of investing for over 30 years. Value investing works better as a higher turnover strategy? Growth works better as a low turnover strat...
by stlutz
Thu Sep 01, 2016 10:03 pm
Forum: Investing - Theory, News & General
Topic: Value vs Growth - Depends on the Turnover Frequency?
Replies: 34
Views: 2072

Re: Value vs Growth - Depends on the Turnover Frequency?

Suppose I form two portfolios of large-cap stocks. One has 151 stocks. The other has 34 stocks. Which do you expect will be more volatile? Suppose I form one portfolio composed of 90% of the market value of US stocks and I form the other composed of 10% of the market value of US stocks, which will b...
by stlutz
Wed Aug 31, 2016 6:56 pm
Forum: Personal Consumer Issues
Topic: Long wait on Vanguard Phone Lines-What's going on?
Replies: 54
Views: 5685

Re: Long wait on Vanguard Phone Lines-What's going on?

I think management is well aware of the problems. Complaints are all over the interwebs. If there isn't something you specifically want (i.e. money), then escalating probably isn't necessary.
by stlutz
Wed Aug 31, 2016 6:50 pm
Forum: Investing - Theory, News & General
Topic: How to give unsolicited advice
Replies: 54
Views: 3404

Re: How to give unsolicited advice

On Saturday morning when they ask you what you want to do for the day, you say, "I'm going to look at my Vanguard mutual fund retirement accounts and see if I need to rebalance." Then you pop open your laptop, look and say, "Wow, I'm doing great! I'll buy dinner tonight for everyone....
by stlutz
Wed Aug 31, 2016 6:46 pm
Forum: Investing - Theory, News & General
Topic: How to give unsolicited advice
Replies: 54
Views: 3404

Re: How to give unsolicited advice

Do not give unsolicited advice, unless you are a recognized expert in your field, and there is an obvious, undeniable knowledge disparity on a subject between the two of you. Remember the question you must ask yourself is "Does this person think that I am in a position to provide advice on thi...
by stlutz
Wed Aug 31, 2016 6:38 pm
Forum: Investing - Help with Personal Investments
Topic: Apple free index??
Replies: 26
Views: 2300

Re: Apple free index??

I've been indexing for the longest time, mainly just VTI and BND. With the extreme treatment of Foxconn employees and the resulting deaths, I can't support a company that supports virtual slavery. I want nothing to do Apple. So, how can I best reproduce the total stock market index without AAPL? Th...
by stlutz
Tue Aug 30, 2016 8:17 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Dividend Announcements
Replies: 27
Views: 3221

Re: Vanguard Dividend Announcements

Perhaps you can share with us one of BB's numbers so we can check to see if it matches the actual one?
by stlutz
Tue Aug 30, 2016 6:13 pm
Forum: Investing - Help with Personal Investments
Topic: Should I terminate CD to get a better rate?
Replies: 38
Views: 2401

Re: Should I terminate CD to get a better rate?

Kevin M: Since you follow CDs a lot more closely than I do, I'm curious what your response would be to the following thinking (i.e. I'm phrasing a question as a statement): If you are looking to break a single CD, you probably screwed up when you bought it in the first place. Unusually high rates po...
by stlutz
Mon Aug 29, 2016 7:36 pm
Forum: Investing - Help with Personal Investments
Topic: Low Volatility Equity ETFs
Replies: 2
Views: 276

Re: Low Volatility Equity ETFs

You should expect your low vol funds to underperform most of the time. Their performance over the past year has been highly unusual. If the overall market goes up 20% over the next year, I'd expect your low vol funds to go up less than that. But you should always expect that. Generally it's better t...
by stlutz
Mon Aug 29, 2016 7:19 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth Article on "Under the radar tax benefit for muni bond funds"
Replies: 24
Views: 3280

Re: Allan Roth Article on "Under the radar tax benefit for muni bond funds"

#Cruncher objected to my claim that this was not that big of a deal. I stand by my conclusion, as it was based on the more practical question of what am I supposed to do with this information? To a long-term holder of this fund, I indirectly bought the bonds at the same time Vanguard did, so there i...
by stlutz
Sun Aug 28, 2016 10:32 pm
Forum: Investing - Help with Personal Investments
Topic: What to do with munis in taxable after we retire?
Replies: 7
Views: 695

Re: What to do with munis in taxable after we retire?

One point I would make is is that this general question shows one of the advantages of holding munis via a fund vs. going the individual bond route. If your tax rates changes to make munis no longer advantageous, you can switch to taxable bonds with the click of a mouse when you hold via a fund. Whi...
by stlutz
Sun Aug 28, 2016 5:48 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth Article on "Under the radar tax benefit for muni bond funds"
Replies: 24
Views: 3280

Re: Allan Roth Article on "Under the radar tax benefit for muni bond funds"

Here is an article stating that bond funds do amortize premium, so that leaves some interesting questions about the accounting that goes on within a bond fund. A fund will account for it in the same way that you would if you purchased the bond yourself. If you buy a premium bond yourself, your taxe...
by stlutz
Sun Aug 28, 2016 5:35 pm
Forum: Investing - Theory, News & General
Topic: Better growth? Or on how the value premium ends
Replies: 211
Views: 11079

Re: Better growth? Or on how the value premium ends

So for certain people, it seems unthinkable that all the hard work researching, picking stocks, picking funds, and trying to buy cheaper assets opportunistically doesn't automatically pay off. By golly, I worked hard for those extra returns. If it comes clear that I wasn't particularly skilled as a...
by stlutz
Sun Aug 28, 2016 5:24 pm
Forum: Investing - Theory, News & General
Topic: Better growth? Or on how the value premium ends
Replies: 211
Views: 11079

Re: Better growth? Or on how the value premium ends

All this is pretty confusing to me as a new investor, but still interesting to read. What caught my attention is all the talk on decreasing value premiums. I realize a lot is speculation and not set in stone, but for those of us starting out, and now have a portfolio approaching 100k, is the 75-25 ...
by stlutz
Sun Aug 28, 2016 5:19 pm
Forum: Investing - Theory, News & General
Topic: Better growth? Or on how the value premium ends
Replies: 211
Views: 11079

Re: Better growth? Or on how the value premium ends

Personally, I don't find the idea of "risk premiums" all that compelling to begin with, too many "anomalies" for that to be the explanation of returns among stocks. The performance in recent years just further points it out. Lots of interesting alternative stories/explanations o...
by stlutz
Sun Aug 28, 2016 9:53 am
Forum: Investing - Help with Personal Investments
Topic: Convert a lazy buy-and-hold portfolio to a lazy income-oriented one
Replies: 9
Views: 1126

Re: Convert a lazy buy-and-hold portfolio to a lazy income-oriented one

With equities, there is no such thing as "principal". Suppose a company trades at $100 and makes a profit of $5. It can: a) pay a $5 dividend b) Buy back $5 worth of stock and drive the stock price up to $105. c) Reinvest in the business so it makes $10 next year. (a) is straightforward en...
by stlutz
Sun Aug 28, 2016 9:22 am
Forum: Investing - Help with Personal Investments
Topic: Asset Allocation Option A or Option B?
Replies: 22
Views: 1260

Re: Asset Allocation Option A or Option B?

I'm afraid I have to disagree with Taylor on the use of the particular TR funds you have in your 401K plans. The ERs are just too high relative to other much more attractive options. Since it doesn't look like you are holding your Roth IRAs at Vanguard, I probably wouldn't worry about trying to use ...
by stlutz
Sat Aug 27, 2016 8:15 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth Article on "Under the radar tax benefit for muni bond funds"
Replies: 24
Views: 3280

Re: Allan Roth Article on "Under the radar tax benefit for muni bond funds"

One additional note: For a bond fund that holds onto its bonds for a long time like VG IT TE does, it is *normal* for the distribution yield to be higher than the SEC Yield if there is an upward-sloping yield curve. Suppose the fund is rolling a 10 year ladder (roughly). The SEC Yield is based on th...
by stlutz
Sat Aug 27, 2016 8:09 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth Article on "Under the radar tax benefit for muni bond funds"
Replies: 24
Views: 3280

Re: Allan Roth Article on "Under the radar tax benefit for muni bond funds"

This article is making it sound like there is a loophole when there is in fact none. WARNING! Minor math oversimplifications about to follow! Let's start by looking at this from the perspective of the individual investor. A 10 year muni bond is issued at par ($100) and it pays interest of $3 per yea...
by stlutz
Sat Aug 27, 2016 7:54 am
Forum: Investing - Theory, News & General
Topic: Is Vanguard's reported Yield-to-maturity a Yield-to-worst?
Replies: 2
Views: 418

Re: Is Vanguard's reported Yield-to-maturity a Yield-to-worst?

My understanding is "yes". I know iShares says so explicitly and the reported yields are in line with what VG reports for funds that are highly similar.

The SEC Yield calculation (in the US) requires YTW as the basis.
by stlutz
Sat Aug 27, 2016 12:00 am
Forum: Investing - Theory, News & General
Topic: Adding Inflation Protection to a Portfolio
Replies: 14
Views: 1548

Re: Adding Inflation Protection to a Portfolio

No interest rate risk if held to maturity Most of what you have is on track except for this statement. Suppose you bought a 30 year TIPs yielding .64% today. A year from now, 30 year TIPS are yielding 2.64%. If you had waited a little while to buy, you could have gotten a much higher rate. That is ...
by stlutz
Wed Aug 24, 2016 11:49 pm
Forum: Investing - Theory, News & General
Topic: Better growth? Or on how the value premium ends
Replies: 211
Views: 11079

Re: Better growth? Or on how the value premium ends

What do you think? I may still be missing something. backpacker: I think you are allowing Larry to lead you down too many ratholes. :) I'd suggest that readers go back and re-read the original post, which was still the best one in this entire thread, IMO. Several comments on this which mostly repea...
by stlutz
Wed Aug 24, 2016 12:36 am
Forum: Investing - Theory, News & General
Topic: Better growth? Or on how the value premium ends
Replies: 211
Views: 11079

Re: Better growth? Or on how the value premium ends

I'm claiming that your value spread wouldn't tell you if the market switched to charging a uniform price for capital, i.e wouldn't tell you if the value premium went away. I thought that was the point of talking about the value spread. It was suppose to be a way of showing people that this hasn't h...
by stlutz
Tue Aug 23, 2016 7:29 pm
Forum: Investing - Help with Personal Investments
Topic: TIPs, I've read the posts, still confused
Replies: 20
Views: 1091

Re: TIPs, I've read the posts, still confused

It's not an obvious choice. When it comes to bonds, an equity heavy investor cares most about what those bonds do when stocks go down. 2008 was not encouraging in this regard. However, it's a big jump to go from that to saying that TIPS necessarily do a bad job of balancing out equity risks. I can c...
by stlutz
Tue Aug 23, 2016 7:22 pm
Forum: Investing - Theory, News & General
Topic: UK TIPS track record - what can we learn?
Replies: 18
Views: 1074

Re: UK TIPS track record - what can we learn?

During the high inflation years of the 1970s, a nominal bond portfolio of intermediate duration didn't do great, but didn't do too bad, either. Most of the scary charts illustrate the synthetic returns of a constant-maturity long-term bond. So, one has to be careful, when interpreting charts. True,...
by stlutz
Tue Aug 23, 2016 7:17 pm
Forum: Investing - Help with Personal Investments
Topic: Which Bond Fund to Choose
Replies: 8
Views: 1191

Re: Which Bond Fund to Choose

2 questions:

--Are there *any* funds in your 401K with low expense ratios?
--Do you have any other investments outside of your 401K such as an IRA?

If you, say, had a low cost stock fund in your 401, it might make sense to just hold bonds in your IRA. In short, look at your options as a whole.
by stlutz
Tue Aug 23, 2016 7:13 pm
Forum: Investing - Theory, News & General
Topic: Better growth? Or on how the value premium ends
Replies: 211
Views: 11079

Re: Better growth? Or on how the value premium ends

I think backpacker and Larry are talking past one another, hence the frustration. As a completely objective observer (yes, you are supposed to laugh at that :happy ), let me attempt to mediate. I don't think Larry disagrees with backpacker's math at all. I think Larry's argument is simply that backp...

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