Search found 2419 matches

by patrick013
Sun Dec 09, 2018 1:41 pm
Forum: Investing - Theory, News & General
Topic: Do long-term bonds belong in one's portfolio?
Replies: 137
Views: 5750

Re: Do long-term bonds belong in one's portfolio?

It's a common observation when stock prices go up bond prices go down, and when stock prices go down bond prices go up. I would stop you right there though if I may. It's a common *belief* that stock and US treasury bond prices are negatively correlated. It's not actually a historically strong rela...
by patrick013
Sat Dec 08, 2018 9:24 pm
Forum: Investing - Theory, News & General
Topic: International underperformance - how to break it down
Replies: 52
Views: 3786

Re: International underperformance - how to break it down

Just trying to get sense for whether micro or macro factors are primarily at play. Thanks! I think there are some good LC's internationally but who knows what their exchange rates are. The casino effect. Most internationals are smaller economies dependent on exports for extra profits. Not a monetar...
by patrick013
Sat Dec 08, 2018 6:41 pm
Forum: Investing - Theory, News & General
Topic: Do long-term bonds belong in one's portfolio?
Replies: 137
Views: 5750

Re: Do long-term bonds belong in one's portfolio?

This is the model's output of *expected* term premium at each of those dates, not the realized premium. Bond investors imposed a huge expected premium in '80's-90's after they got more and more severely burned by unexpected inflation from the late 60's to early 80's. That big premium went back to p...
by patrick013
Sat Dec 08, 2018 1:44 pm
Forum: Investing - Theory, News & General
Topic: Do long-term bonds belong in one's portfolio?
Replies: 137
Views: 5750

Re: Do long-term bonds belong in one's portfolio?

Right now moving towards a 3 year ladder. Alot of market talk about a crash and lower interest rates. Objective is income from interest income. I don't think LT would be best but a 10 year bond yielding 4% would definitely put some income in the account. I don't think we'll see a 4% TRSY for a few y...
by patrick013
Fri Dec 07, 2018 6:56 pm
Forum: Investing - Theory, News & General
Topic: Flaw in Logic? CD ladder instead of bond funds
Replies: 80
Views: 7515

Re: Flaw in Logic? CD ladder instead of bond funds

I went over and opened a Fidelity account so I could see what they had to offer that Vanguard did not only to find that ll their higher yielding CDs had call provisions. That completely defeats the purpose of a long CD. There are fewer Vanguard CD offerings but they are the same as the Fidelity off...
by patrick013
Fri Dec 07, 2018 3:03 pm
Forum: Investing - Theory, News & General
Topic: Flaw in Logic? CD ladder instead of bond funds
Replies: 80
Views: 7515

Re: Flaw in Logic? CD ladder instead of bond funds

The Fed might leave the rates as is if the market completely collapses. Rates are low. There seems to be a movement out of stocks into bonds today. My best 3 year CD ladder from Fidelity yields slightly over 3%. That 10 year Farm Credit Bank new issue still looks tempting if 4% at par is worth the e...
by patrick013
Thu Dec 06, 2018 12:57 pm
Forum: Investing - Help with Personal Investments
Topic: Long term market cap tilt with simple ratios
Replies: 11
Views: 824

Re: Long term market cap tilt with simple ratios

So here are the questions: 1) What is your opinion on shifting market weight as I am suggesting? 2) Should I consider a 2:1 split on international between Developed and Emerging Markets? 3) As far as tilting is concerned, would you consider this a simplified approach? Backtest Portfolio Asset Alloc...
by patrick013
Thu Dec 06, 2018 12:23 pm
Forum: Investing - Theory, News & General
Topic: Flaw in Logic? CD ladder instead of bond funds
Replies: 80
Views: 7515

Re: Flaw in Logic? CD ladder instead of bond funds

How would you suggest to compare a low risk bond fund (e.g. Treasury) with a CD - is it fair to compare the APY of the CD with the SEC yield of the bond fun? SEC yield is a measurement today, if the overall market and bond portfolio stayed the same. Drawdowns or gains may occur for a variety of eve...
by patrick013
Tue Dec 04, 2018 1:19 pm
Forum: Investing - Theory, News & General
Topic: FINRA sponsored SIE exam
Replies: 2
Views: 325

Re: FINRA sponsored SIE exam

reneedegutis wrote:
Tue Dec 04, 2018 7:02 am

How can I reschedule the exam?
Someone at FINRA I would guess. You can retake the exam if you fail.
by patrick013
Sat Dec 01, 2018 2:54 pm
Forum: Investing - Help with Personal Investments
Topic: Need advice on allocation of fixed income.
Replies: 10
Views: 902

Re: Need advice on allocation of fixed income.

How much should be in government, high yield corporate, TIPS, mortgage backed, asset backed, foreign, emerging... by age? etc? I would buy a 5 year CD every year as the rates compare to 10 year TRSY's and are very safe investments. That does not prevent you from buying longer term if and when rates...
by patrick013
Sat Dec 01, 2018 2:13 pm
Forum: Investing - Theory, News & General
Topic: FINRA sponsored SIE exam
Replies: 2
Views: 325

FINRA sponsored SIE exam

Fresh Finance grads, investors, anybody, can qualify for future exams by taking this test. It does not affect the Series 65 but does affect the Series 79 and other exams.

Securities Industry Essentials Exam (SIE) | Investopedia

Securities Industry Essentials (SIE) Exam | FINRA

SIE Exam
by patrick013
Fri Nov 30, 2018 3:54 pm
Forum: Investing - Help with Personal Investments
Topic: just retired. need to figure out a fixed income strategy.
Replies: 14
Views: 2637

Re: just retired. need to figure out a fixed income strategy.

I also need to take a closer look at tax implications of RMD's once hit 70.5, determine if I need to address, and best approach to mitigating if needed. Yes, you need to estimate your marginal tax rate when 70, when the tax rate will affect your tIRA withdrawals. You invest in tIRA's during your ca...
by patrick013
Thu Nov 29, 2018 9:39 pm
Forum: Investing - Help with Personal Investments
Topic: just retired. need to figure out a fixed income strategy.
Replies: 14
Views: 2637

Re: just retired. need to figure out a fixed income strategy.

I have no plan for the large fixed income component. Currently I have ~10% of fixed income in Total Bond funds and ~10% in a TIPS fund. A whopping 80% is sitting in CD's and Zero's maturing in 2 years or less. I've seen some 5 year CD's at 4% already. Good for the CD ladder. A 3 to 5 year CD ladder...
by patrick013
Thu Nov 29, 2018 5:12 pm
Forum: Investing - Theory, News & General
Topic: Model Portfolios
Replies: 5
Views: 1025

Re: Model Portfolios

35% bond index 10% intl index 10% Russell 2000 index 45% Russell 1000 index The above has captured 90% of the gain of the 500 with much less volatility over the last 20 years. Will that continue ? Who knows. It had a 10% or more portfolio loss only once. I hear more analysts wish they had a short te...
by patrick013
Wed Nov 28, 2018 11:42 am
Forum: Investing - Help with Personal Investments
Topic: Marijuana [Stock]
Replies: 50
Views: 4490

Re: Marijuana

Indexing again is probably the way to go. The research would be to the investor's advantage. Some individual companies are luring investors with claims of dozens of operations when in fact they only have a few outlets or operations. Research would uncover that. Demand has exceeded supply and supply ...
by patrick013
Sat Nov 24, 2018 3:30 pm
Forum: Investing - Help with Personal Investments
Topic: Understanding Portfolio Return
Replies: 8
Views: 1036

Re: Understanding Portfolio Return

Thanks, patrick013, but that calculates IRR (aka investor return or money-weighted return), which I find to be less useful. I need the portfolio return to compare against standard indices. Right, it extends the investor return a bit. For portfolio return I'd be happy with the published annual retur...
by patrick013
Sat Nov 24, 2018 1:09 pm
Forum: Investing - Help with Personal Investments
Topic: Understanding Portfolio Return
Replies: 8
Views: 1036

Re: Understanding Portfolio Return

Here's a spreadsheet I'm kinda familiar with. It just accounts for the number of shares, contributions and withdrawals, then calc's an IRR for the ending balance which could be months or years of transactions. You would need a separate sheet for each asset class. Might help might not. https://i.ibb....
by patrick013
Mon Nov 19, 2018 8:59 pm
Forum: Investing - Help with Personal Investments
Topic: Let's Talk About Annuities
Replies: 11
Views: 1356

Re: Let's Talk About Annuities

An SPIA can make sense if you plan on living over 15 years or so, or contract the annuity for a specific term, say 10 years. Then the compound return is over the rate on the highest paying 5 year CD's slightly. An exclusion ratio is used so you only pay taxes on the income portion of the monthly pay...
by patrick013
Fri Nov 16, 2018 4:13 pm
Forum: Investing - Help with Personal Investments
Topic: Do I need a financial advisor?
Replies: 12
Views: 1277

Re: Do I need a financial advisor?

I have a 401k where I work which I'll continue to contribute to. Worth about $5k. I'll start investing in a Roth also. .......................................... I've been meaning to do this for 20 years. I just want to avoid fees. If you read the Boglehead Guide you're not supposed to need an Advi...
by patrick013
Wed Nov 14, 2018 3:19 pm
Forum: Personal Consumer Issues
Topic: Understanding the difference in cell phone OS types
Replies: 49
Views: 2591

Re: Understanding the difference in cell phone OS types

I just bought a used Kindle just to check the news, email, not much else it will do I think. Not much power just a screen. Looked at many tablets from 7" to 10". Apple, Android, Linux OS's very common. One 10" new Onda tablet had an 8 core processor, 4G telephone capability, claims it can do almost ...
by patrick013
Tue Nov 13, 2018 4:19 pm
Forum: Investing - Theory, News & General
Topic: Investment advisors- is regulatory burden higher on fiduciaries?
Replies: 51
Views: 2137

Re: Investment advisors- is regulatory burden higher on fiduciaries?

My question is what is the regulatory, or should I say paperwork burden difference between holding himself out as purchasing suitable investments (which is what he is doing) and being a fiduciary? The account agreement needs to have full disclosure. Is it a 1 time consultation or a does the advisor...
by patrick013
Mon Nov 12, 2018 10:01 pm
Forum: Investing - Theory, News & General
Topic: Treasury term premium estimate: negative in most of 2017, now 2018 too (NY Fed Adrian, Crump, Moench model)
Replies: 51
Views: 5820

Re: Treasury term premium estimate: negative in most of 2017, now 2018 too (NY Fed Adrian, Crump, Moench model)

Curious that Agency 10's at par are yielding 4% today, very much in line with these averages. Agencies have an additional risk that you may not be taking into account. A lot of these are mortgage backed securities, which sell an embedded call option via refinancing in falling rate environments. Als...
by patrick013
Mon Nov 12, 2018 1:40 pm
Forum: Investing - Theory, News & General
Topic: Treasury term premium estimate: negative in most of 2017, now 2018 too (NY Fed Adrian, Crump, Moench model)
Replies: 51
Views: 5820

Re: Treasury term premium estimate: negative in most of 2017, now 2018 too (NY Fed Adrian, Crump, Moench model)

The way Liquidity Preference Theory was taught to me the term premium represents lost opportunity cost. In plain language buyers should want higher interest for higher maturities as compensation for giving up their money for longer periods of time. Reinvestment risk or inflation risk has little or n...
by patrick013
Sun Nov 11, 2018 6:42 pm
Forum: Investing - Theory, News & General
Topic: Treasury term premium estimate: negative in most of 2017, now 2018 too (NY Fed Adrian, Crump, Moench model)
Replies: 51
Views: 5820

Re: Treasury term premium estimate: negative in most of 2017, now 2018 too (NY Fed Adrian, Crump, Moench model)

I haven't updated this in a while so I thought I might as well. New graph up top. No actual analysis here, just basically graphing the available info. ACM model still does not think much of current pricing in bonds (still thinks a negative term premium is priced in), even with all rates up since la...
by patrick013
Sun Nov 11, 2018 2:33 pm
Forum: Investing - Help with Personal Investments
Topic: Short Bond Funds or Tips Funds or Bond Ladder
Replies: 12
Views: 1490

Re: Short Bond Funds or Tips Funds or Bond Ladder

I need to have readily available investments available many suggest a Bond Ladder for this purpose CD Ladder Fidelity has 2 and 5 year CD ladders ready for push button investment. Or you can make your own for any maturity. They usually yield more than a ST Bond fund and a TRSY10. They've been popul...
by patrick013
Sat Nov 10, 2018 11:36 pm
Forum: Investing - Help with Personal Investments
Topic: Help to understand bonds maturity vs investment timeline
Replies: 3
Views: 399

Re: Help to understand bonds maturity vs investment timeline

To me it is more important to be in the right maturity for bonds. The trouble right now is bonds don't pay that much and some investors don't want large equity AA due to other risk. When interest rates are high, constant, or falling then some capital gains are expected as well as normal interest inc...
by patrick013
Fri Nov 09, 2018 4:27 pm
Forum: Investing - Help with Personal Investments
Topic: VIG (and SCHD etc) [tilting towards dividend stocks]
Replies: 6
Views: 532

Re: VIG (and SCHD etc) [tilting towards dividend stocks]

https://us.spindices.com/documents/research/research-the-beauty-of-simplicity-the-sp-500-low-volatility-high-dividend-index.pdf?force_download=true Exhibit 10 above has a good selection of other dividend index funds that have had good returns while interest rates were low. Ticker SCHD is on the exhi...
by patrick013
Wed Nov 07, 2018 5:52 pm
Forum: Investing - Theory, News & General
Topic: Guide to work out your asset allocation?
Replies: 12
Views: 1125

Re: Guide to work out your asset allocation?

Aggressive (young worker) = 75% stocks

Moderate = 50% stocks

Conservative (retired) = 25% stocks

Portfolio Allocation Models
by patrick013
Wed Nov 07, 2018 3:37 pm
Forum: Investing - Theory, News & General
Topic: Good explanation of how bond funds don't get crushed in rising rate environment
Replies: 64
Views: 6361

Re: Good explanation of how bond funds don't get crushed in rising rate environment

Well expected YTM will just have to do for expected prices. Excess demand is keeping spreads low around 1% for TRSY10. But volatility being what it is lately anything between 0% and 2% for spread is somewhat possible. That creates a buying or selling sign but I don't really want to do that. Watching...
by patrick013
Wed Nov 07, 2018 1:34 pm
Forum: Investing - Theory, News & General
Topic: Good explanation of how bond funds don't get crushed in rising rate environment
Replies: 64
Views: 6361

Re: Good explanation of how bond funds don't get crushed in rising rate environment

I've yet to read through a quality explanation of why bond funds don't get hammered in a rising rate environment? The lazy analysis you hear a lot is that bonds are a terrible place to be in such an environment. Can someone provide a thorough explanation of how bond funds that many of you invest in...
by patrick013
Tue Nov 06, 2018 7:02 pm
Forum: Investing - Help with Personal Investments
Topic: Time to ditch the financial advisor?
Replies: 17
Views: 2155

Re: Time to ditch the financial advisor?

Thanks for the links - hadn't heard of a backdoor roth until today. Regarding the tax implications - is the caution just to be prepared for a bill or will they affect my move? Seems like I'm stuck paying them and a new AA and investing approach is needed regardless. You could keep them and just fun...
by patrick013
Tue Nov 06, 2018 6:40 pm
Forum: Investing - Help with Personal Investments
Topic: Time to ditch the financial advisor?
Replies: 17
Views: 2155

Re: Time to ditch the financial advisor?

New to trying to actually understand my investments and looking for some advice. If you think you will be in the same tax bracket in retirement I'd start putting money in Roth or Backdoor Roth . Check the VG wiki also. Reallocate using Tax-efficient Fund Placement . I'd put some investment grade mu...
by patrick013
Mon Nov 05, 2018 12:33 pm
Forum: Investing - Help with Personal Investments
Topic: Are Bond Funds Really a Good Investment Now?
Replies: 44
Views: 5077

Re: Are Bond Funds Really a Good Investment Now?

I don't believe that common investors have any idea. Most people do have some idea at least to the point where they can adjust their bond AA to avoid most losses or avoid below average bond returns due to policy rate changes that happen from time to time. Fed watching should give confidence rather ...
by patrick013
Sun Nov 04, 2018 2:36 pm
Forum: Investing - Help with Personal Investments
Topic: Are Bond Funds Really a Good Investment Now?
Replies: 44
Views: 5077

Re: Are Bond Funds Really a Good Investment Now?

Some people think LT is a sure thing but what if there is a secular trend of downward rates. That's simple. What if there is a secular trend of higher rates. One unknown Phd candidate who claims influence from Fabozzi, Damodaran, and Choudhry has some ideas about the recent bond market. He says: "Cu...
by patrick013
Fri Nov 02, 2018 8:03 pm
Forum: Personal Finance (Not Investing)
Topic: Is an MBA worth it these days?
Replies: 53
Views: 6378

Re: Is an MBA worth it these days?

It's only worth it if you can get into a top ten school. It's a bunch of luck too. I know a fellow that rec'd his MBA from a decent small local school. Knew people from the neighborhood, one of whom was an officer at a very big regional corp.. His encouragement was an element in his securing employ...
by patrick013
Fri Nov 02, 2018 7:32 pm
Forum: Personal Finance (Not Investing)
Topic: Is an MBA worth it these days?
Replies: 53
Views: 6378

Re: Is an MBA worth it these days?

For construction projects it could be very project related. I mean investment theory, corp theory, etc. may have very little meaning. Even a real estate emphasis might be better. Even a Business Administration emphasis could be less pertinent than a Project Management emphasis. Project approval, cas...
by patrick013
Thu Nov 01, 2018 1:07 pm
Forum: Investing - Help with Personal Investments
Topic: CD vs. Deferred Fixed Annuity
Replies: 13
Views: 1355

Re: CD vs. Deferred Fixed Annuity

So, high tax, taxable account, large deposit/investment, fixed time/duration. Guaranteed rate of return? What are other potential options or alternatives? A 3-year treasury? There is an exclusion ratio which covers annuities. This determines how much of the payment is return of principal and how mu...
by patrick013
Thu Nov 01, 2018 12:41 pm
Forum: Investing - Theory, News & General
Topic: Why I'm 100% stocks
Replies: 149
Views: 17390

Re: Why I'm 100% stocks

Someone who desires a very high stock AA needs to be aware
of the drawdowns possible. I'm thinking one CD for each year's
expenses.

Image
by patrick013
Wed Oct 31, 2018 9:04 pm
Forum: Investing - Theory, News & General
Topic: Large cap value, small cap, mid cap, etc. index funds
Replies: 15
Views: 1026

Re: Large cap value, small cap, mid cap, etc. index funds

bigtex wrote:
Wed Oct 31, 2018 1:41 pm
Is it still within Boglehead parameters to hold these types of index funds such as large cap value index fund (IVE), VIGRX (Vanguard Large Cap Growth), or IJR (Small Cap Core)?
As long as you are interested I tilt to the own's below.

Portfolio Asset Allocation
by patrick013
Wed Oct 31, 2018 5:09 pm
Forum: Personal Finance (Not Investing)
Topic: Is an MBA worth it these days?
Replies: 53
Views: 6378

Re: Is an MBA worth it these days?

BeanCity wrote:
Wed Oct 31, 2018 3:45 pm
I want to get into the financial side of construction for commercial real estate, where I would evaluate/run financials on new deals.
What would be the cost of a second BS degree ? Nothing in Finance
it wouldn't cover. Tuition has risen and it's hard to justify it.
by patrick013
Wed Oct 31, 2018 1:06 pm
Forum: Investing - Theory, News & General
Topic: Initial SEC yield and subsequent 5yr and 10yr returns
Replies: 204
Views: 18948

Re: Initial SEC yield and subsequent 5yr and 10yr returns

Here's a text from the web site of an investment advisory firm (Merriman) found googling "irr time-weighted" (first hit): http://www.merriman.com/investing-101/performance-time-weighted-return-vs-internal-rate-of-return/ TWR = time-weighted return IRR = internal rate of return There really is no pr...
by patrick013
Tue Oct 30, 2018 10:39 pm
Forum: Investing - Theory, News & General
Topic: Initial SEC yield and subsequent 5yr and 10yr returns
Replies: 204
Views: 18948

Re: Initial SEC yield and subsequent 5yr and 10yr returns

The key point is this: the money-weighted returns of two investments X and Y over a period T aren't comparable ( unless they had identical cash flows except for the final balance ). On the other hand, the widely published time-weighted returns of various investments are comparable. My only point is...
by patrick013
Tue Oct 30, 2018 8:33 pm
Forum: Investing - Theory, News & General
Topic: Initial SEC yield and subsequent 5yr and 10yr returns
Replies: 204
Views: 18948

Re: Initial SEC yield and subsequent 5yr and 10yr returns

No! Fund companies must use time-weighted returns when reporting annualized returns / compound returns. Interested readers can learn about the difference by reading our wiki: Calculating personal returns Whether you want investor returns or portfolio returns all of those IRR's give identical answer...
by patrick013
Tue Oct 30, 2018 6:48 pm
Forum: Investing - Theory, News & General
Topic: Initial SEC yield and subsequent 5yr and 10yr returns
Replies: 204
Views: 18948

Re: Initial SEC yield and subsequent 5yr and 10yr returns

I don't know why we're discussing such basic stuff in a thread that clearly involves members who seem to know the basic mathematics of investing. IRR is a money-weighted return . The IRR goes my many other names : YTM effective yield annualized return compound return ... No! Fund companies must use...
by patrick013
Tue Oct 30, 2018 6:03 pm
Forum: Investing - Theory, News & General
Topic: Initial SEC yield and subsequent 5yr and 10yr returns
Replies: 204
Views: 18948

Re: Initial SEC yield and subsequent 5yr and 10yr returns

Internal Rate of Return = discount rate where the PV equals zero. Dozens of industry or security specific names for the IRR. The IRR goes my many other names : YTM effective yield annualized return compound return annual percentage yield discounted ROI compound interest rate cumulative cash return r...
by patrick013
Mon Oct 29, 2018 7:45 pm
Forum: Investing - Theory, News & General
Topic: Initial SEC yield and subsequent 5yr and 10yr returns
Replies: 204
Views: 18948

Re: Initial SEC yield and subsequent 5yr and 10yr returns

I thought it was well established that 5 and 10 year annual returns have historically been within +/- 1% of the starting SEC yield. And when posters are demonstrating that the correlation between the two has indeed been quite high, many are still stating that the SEC yield isn't a "good predictor."...
by patrick013
Mon Oct 29, 2018 7:20 pm
Forum: Investing - Help with Personal Investments
Topic: Fixed income other than bonds, CD's, money market?
Replies: 7
Views: 974

Re: Fixed income other than bonds, CD's, money market?

A Single Premium Immediate Annuity could be good if you
are older and the rates were higher. The internal rate of
return based on your projected lifespan is usually over CD
APY rates. So it would be better to wait till interest rates
were higher.
by patrick013
Mon Oct 29, 2018 2:11 pm
Forum: Personal Consumer Issues
Topic: Vehicle recommendations for long commutes in CO mountains
Replies: 72
Views: 4762

Re: Vehicle recommendations for long commutes in CO mountains

What's the benefit of a Silverado or a RAM 1500 4x4 ?

The Subaru is a smaller vehicle I think.
by patrick013
Sat Oct 27, 2018 9:26 pm
Forum: Investing - Theory, News & General
Topic: Bogle’s SP500 Returns Math
Replies: 21
Views: 3945

Re: Bogle’s SP500 Returns Math

That's what I'm trying to get at. Adding the return doesn't produce the correct return. This is a math problem, not a data problem, and I'm just not smart enough to figure out why the math is off. Every forecast is off by a specific error term. I like using a confidence interval. It gives the forec...
by patrick013
Sat Oct 27, 2018 8:32 pm
Forum: Investing - Theory, News & General
Topic: Bogle’s SP500 Returns Math
Replies: 21
Views: 3945

Re: Bogle’s SP500 Returns Math

I like the way Bogle does it. Dividend yield, earnings growth, and change in PE. When I use those metrics instead of economic indicators the estimate is more precise or realistic. Stock estimates you can easily cut in half IMO but dividends, and PE following EPS and interest rates respectively is wh...