Search found 153 matches

by whiteprius
Sat Jan 06, 2018 11:23 am
Forum: Personal Consumer Issues
Topic: To take or not to take delivery of Tesla 3
Replies: 1326
Views: 159860

Re: To take or not to take delivery of Tesla 3

Actually there are really good reasons to not get a 2014 Model S. To get the same range, oh wait you can nothing made in 2014 has an EPA over 300 miles. The S is a lot larger. Not everyone wants a car that is physically that large. The warranty isn't as good. The positive is that supercharger use is typically free. Personally as it only costs about $100 to go coast to coast in a Model 3 the free access isn't too important but it is nice. Last but not least a CPO 2014 S with reasonable miles is going to be $60K+. A Model 3 with LR, AWD and a color other than black is likely to be $55 or less I think the 3 is the better deal. Of course YMMV. As far as being reliable, I know several people with Tesla vehicles. Not one of them have been strand...
by whiteprius
Sat Jan 06, 2018 11:10 am
Forum: Investing - Theory, News & General
Topic: Gambling vs Investing
Replies: 23
Views: 2866

Re: Gambling vs Investing

One other thing, the stock market's odds COULD be better than the odds at a roulette table (playign red or black) but I DO NOT RECOMMEND GAMBLING IN STOCKS because you don't know the odds in advance. With a roulette table it's close to 50/50 (I think 48/52) but with stocks it's UNKNOWN.

If you want to gamble on the stock market, invest in the S&P 500 which I think has a pretty close to 50/50 chance of going up or down. You can buy SSO (2xS&P return) or SPXL (3xS&P return), or their negative return counterparts SDS and SPXS or the e-mini futures.
by whiteprius
Sat Jan 06, 2018 11:05 am
Forum: Investing - Theory, News & General
Topic: Gambling vs Investing
Replies: 23
Views: 2866

Re: Gambling vs Investing

This is a fantastic question with serious moral implications. Some say all investing is gambling because all investing has risk but that's absolutely not true. There is a VERY EASY way to distinguish gambling from investing.

If you're entering a position that you might sell in the next 30 days, you're gambling.

If there is no chance of you selling it in the next 30 days (barring some cataclysmic event like a war or gigantic natural disaster), you're investing.

You can change the 30 day period depending on your own attitudes. Maybe 60 days is more appropriate, but you get the point.
by whiteprius
Sat Jan 06, 2018 10:36 am
Forum: Personal Investments
Topic: Anyone tired of the stock market going up?
Replies: 375
Views: 53057

Re: Anyone tired of the stock market going up?

Don't worry pain is on the way. I don't know if it will happen this year, next year, or the year after that but the longer it takes the more painful it will be. Over the last 120 years -- the S&P 500 has always fallen or risen to a level with around a 15 P/E ratio. You don't know when it will happen, but it will happen and the drops are ALWAYS a very violent spectacle. Look at the chart below and you'll see how frighteningly steep the drops are and you'll also see that they occur totally randomly (although some try to "explain" their occurrence with post-hoc rationalizations).

http://www.multpl.com/
by whiteprius
Sat Jan 06, 2018 10:20 am
Forum: Personal Investments
Topic: How to calculate total return (including dividends)
Replies: 7
Views: 1527

Re: How to calculate total return (including dividends)

This is a huge issue re: websites, many of which only provide price-increase return and not total return. One site that always provides total return for all mutual funds is morningstar's charting feature. Here's a chart of, e.g., the S&P 500 mutual fund's value assuming dividends are reinvested (assuming no tax on such dividend payments). http://quotes.morningstar.com/chart/fund/chart?t=spy&region=usa&culture=en_US&dataParams=%7B%22zoomKey%22%3A9%2C%22version%22%3A%22US%22%2C%22showNav%22%3Atrue%2C%22defaultShowName%22%3A%22name%22%2C%22mainSettingId%22%3A%22main%22%2C%22navSettingId%22%3A%22nav%22%2C%22benchmarkSettingId%22%3A%22benchmark%22%2C%22sliderBgSettingId%22%3A%22sliderBg%22%2C%22volumeSettingId%22%3A%22volume%22%2...
by whiteprius
Sat Jan 06, 2018 10:13 am
Forum: Personal Consumer Issues
Topic: To take or not to take delivery of Tesla 3
Replies: 1326
Views: 159860

Re: To take or not to take delivery of Tesla 3

Absolutely not unless you're certain you can quickly flip it for a material profit. The Tesla is a relatively unreliable status car and there's no need to add range anxiety to your list of life concerns. If you want Tesla status, get a used 2014 or so with an extended warranty so you can pretend you purchased it for $90,000 new.
by whiteprius
Sat Jan 06, 2018 10:03 am
Forum: Personal Investments
Topic: Bond fund: explain please 'average effective maturity' vs. 'average duration'
Replies: 5
Views: 1676

Re: Bond fund: explain please 'average effective maturity' vs. 'average duration'

For some reason, Bogleheads users like to provide links instead of answering a simple question so let me part from the pack. A bond's weighted average maturity is the weighted average of the time to its payments. So if a bond will pay a coupon of $10 in 3 years and coupon and principal of $110 in 4 years, its weighted average maturity is (10x3 + 110x4) / (10 + 110) = 3.91 years. If a bond pays no coupons but pays the entire amount back in 4 years, its weighted average maturity is 4 years. The weighted average maturity is not really that important. A bond's duration is important. This number is designed to measure its sensitivity to interest rate risk. So if a bond has a duration of 4, that means that if interest rates go up 1%, its value wi...
by whiteprius
Thu Jan 04, 2018 12:17 pm
Forum: Personal Investments
Topic: Reminder - if you're carrying credit card debt at low int. rates, you're using dangerous margin
Replies: 7
Views: 1314

Reminder - if you're carrying credit card debt at low int. rates, you're using dangerous margin

I know someone who has about $60,000 of credit card debt, all at 0% interest rates for 12 months. He pays about $900 a month on this debt, and when this 0% rate expires he expects to roll it over to other credit cards that offer a 0% interest for 12 months on balance transfers, and he plans to keep doing this until it's all paid off. But what if the stock market crashes this year AND the credit card companies don't give him another 0% roll over offer next January? He'll either have to liquidate positions at huge losses or pay 15-20% credit card interest.

FYI if this applies to you.
by whiteprius
Thu Jan 04, 2018 12:15 pm
Forum: Personal Consumer Issues
Topic: How much do you spend on food per month, per person?
Replies: 190
Views: 19431

Re: How much do you spend on food per month, per person?

As a result of this thread I'm shooting for $300 a month per person.
by whiteprius
Sat Dec 16, 2017 1:47 pm
Forum: Personal Investments
Topic: Bitcoin futures with Fidelity
Replies: 25
Views: 3726

Re: Bitcoin futures with Fidelity

Edit: Are you planning to short or long?
by whiteprius
Sat Dec 16, 2017 12:15 pm
Forum: Personal Investments
Topic: Question About TIPs and TIP Funds
Replies: 43
Views: 3853

Re: Question About TIPs and TIP Funds

2. The fund yield is a good estimator for the expected real return over a time period whose length matches the duration, not a cherry-picked shorter timeframe. TIPS don't pay you the real interest rate; they pay inflation. The real interest rate plus inflation = the nominal rate, or the rate paid by normal bonds. If inflation is 5% and bonds are paying 0%, then the real interest rate is -5%. TIPS would pay you the 5% not -5%. The value of TIPS changes based on changes in the real interest rate. So if the nominal rate goes up, but inflation does not, thus the real rate goes up, then the value of TIPS falls. You should only be in TIPS if you expect inflation to rise faster than bond interest rates, which is highly highly unlikely in the US r...
by whiteprius
Sat Dec 16, 2017 9:01 am
Forum: Investing - Theory, News & General
Topic: Call the top! - Bitcoin - Bogleheads forum policy remains unchanged
Replies: 193
Views: 28044

Re: Call the top! - Bitcoin

technovelist wrote: Sat Dec 16, 2017 8:27 am
Here you go:

"Bitcoin, PayPal Used to Finance Terrorism, Indonesian Agency Says"
https://www.wsj.com/articles/bitcoin-pa ... 1483964198
It has to be something bigger, like a big attack that's tied to crypto currency financing. In other news, the UK financial regulator told BTC investors that they're on their own if the investment fails. http://www.independent.co.uk/life-style ... 12396.html
by whiteprius
Fri Dec 15, 2017 8:11 pm
Forum: Investing - Theory, News & General
Topic: Moods of the U.S. Stock Market, 1990-2017
Replies: 30
Views: 3158

Re: Moods of the U.S. Stock Market, 1990-2017

lol at the attempted post-hoc rationalizations, e.g. of the 80s as "tight money high inflation" and ignoring the Vietnam war, among other things. And who knew WW1 lasted so long? If you look at the graph, you'll see that almost all of the snapbacks were sudden, very violent (those are very steep lines) and essentially random; they weren't connected to any particular event. I don't know when the next will occur, but those blue bars above are a debt that will be repaid.
by whiteprius
Fri Dec 15, 2017 5:47 pm
Forum: Investing - Theory, News & General
Topic: Moods of the U.S. Stock Market, 1990-2017
Replies: 30
Views: 3158

Re: Moods of the U.S. Stock Market, 1990-2017

Thesaints wrote: Fri Dec 15, 2017 3:40 pm
There is no such thing as a "natural" level. It depends on the rest of the economical environment.
There is a natural level, the level the rubber band has snapped back to over the last 120 years and that's around 15. It might be a little higher or a little lower, but it's not the 20+ we're in now. It's always snapped back in the past, it will this time too.
by whiteprius
Fri Dec 15, 2017 2:38 pm
Forum: Investing - Theory, News & General
Topic: Call the top! - Bitcoin - Bogleheads forum policy remains unchanged
Replies: 193
Views: 28044

Re: Call the top! - Bitcoin

The value of blockchain technology will not boost BTC's value. You can have blockchain without BTC. Also, of course Deutche Bank and others are making crypto exchanges. They want a fee on whatever's moving in the economy. Now show me a serious corporation that has invested a lot in crypto.
by whiteprius
Fri Dec 15, 2017 1:05 pm
Forum: Personal Investments
Topic: Question About TIPs and TIP Funds
Replies: 43
Views: 3853

Re: Question About TIPs and TIP Funds

I haven't checked the yields on specific TIPs maturities recently, but both Vanguard TIPs funds have positive 30-day SEC yields at present. This very likely translates to a positive expected real return over a period of time corresponding to fund duration. On the other hand, cash has a negative expected real return af present, and nominal treasuries will fare worse than duration-matched TIPs if inflation heats up. If you put $10,000 into Vanguard's TIPS fund on 12/8/2012 you would have lost $160 by now, and you would have lost about $1,000 by June 2013. Inflation has been about 5% between 2012 and now. http://quotes.morningstar.com/chart/fund/chart?t=VIPSX&region=usa&culture=en_US&dataParams=%7B%22zoomKey%22%3A11%2C%22startDay%...
by whiteprius
Fri Dec 15, 2017 12:46 pm
Forum: Personal Investments
Topic: Question About TIPs and TIP Funds
Replies: 43
Views: 3853

Re: Question About TIPs and TIP Funds

The notion that a TIPS fund protects against inflation is totally wrong, especially in a rising rate environment. See graph below for the 12-month returns of FBIDX (a safe bond fund) and SCHP (a TIPS fund). I never understood the point of a TIPS mutual fund. I get investing in a single TIPs security over a specific time horizon, but not a fund. http://quotes.morningstar.com/chart/fund/chart?t=FBIDX&region=usa&culture=en_US&dataParams=%7B%22zoomKey%22%3A9%2C%22version%22%3A%22US%22%2C%22showNav%22%3Atrue%2C%22defaultShowName%22%3A%22name%22%2C%22mainSettingId%22%3A%22main%22%2C%22navSettingId%22%3A%22nav%22%2C%22benchmarkSettingId%22%3A%22benchmark%22%2C%22sliderBgSettingId%22%3A%22sliderBg%22%2C%22volumeSettingId%22%3A%22volume%...
by whiteprius
Fri Dec 15, 2017 12:10 pm
Forum: Investing - Theory, News & General
Topic: Moods of the U.S. Stock Market, 1990-2017
Replies: 30
Views: 3158

Re: Moods of the U.S. Stock Market, 1990-2017

One gets the sense that the market's P/E can't really expand too much from here forward, leaving earnings growth to be the main driver of price returns in the years just ahead. P/E is not only unlikely to expand but it will shrink. To understand the OP's chart you have to read it in conjunction with the graph below, which shows that P/E was at its natural 15 in 2011 or so. Knowing that, you will conclude that all post-2011 blue bars in OP's chart are unnatural increases that will be taken away in the future, likely the near future. Same story if you look at Shiller CAPE. This isn't a goose vs. ducks issue the chart below and OP's chart must be read together. Some say the natural P/E level has risen above 15 and that today is different from...
by whiteprius
Fri Dec 15, 2017 12:04 pm
Forum: Personal Consumer Issues
Topic: Uber vs Ambulance - HUGE cost difference
Replies: 85
Views: 13632

Re: Uber vs Ambulance - HUGE cost difference

This is smart. I recommend everyone read their byzantine medical insurance policy to see exactly how much a trip to the ER costs for anticipated emergencies. You'd be surprised that two ER's right next to each other can result in a hugely different cost depending on your insurer's network. One night I went to the ER for something stupid and I (a) drove myself and (b) went to the ER about 1.2 miles away from the closest one (because that had a discount for my policy). Wound up paying only $250. Had I taken an ambulance to the other ER I would have paid $6,000.
by whiteprius
Fri Dec 15, 2017 11:58 am
Forum: Investing - Theory, News & General
Topic: Call the top! - Bitcoin - Bogleheads forum policy remains unchanged
Replies: 193
Views: 28044

Re: Call the top! - Bitcoin

It's up to 17,500 today. I think the top will be $17,500. The only rational conclusion is that the top is where it's currently at. Because there is no logical reason for this increase. 1. There is nothing bitcoin can't do as a currency that the dollar or other traditional currencies can't do, except be used for crime, to evade sanctions, terrorism, drug dealing, hiring people to kill someone . . . darkweb stuff. This should make it a prime target for governments. That is huuuuge risk. 2. It has absolutely no inherent value. At least you could hold a tulip and use it to decorate. BTC is literally nothing. 3. It was originally supposed to be a currency that hedges against inflation, because unlike the dollar governments can't just print bitco...
by whiteprius
Fri Dec 15, 2017 11:13 am
Forum: Personal Investments
Topic: Reached 50X annual spending. Now what?
Replies: 56
Views: 8370

Re: Reached 50X annual spending. Now what?

retiringtype wrote: Fri Dec 15, 2017 9:30 am I remember seeing adidas basketball sneakers for the first time as a kid. No one had ever seen leather sneakers before, and I wanted them desperately. Of course, my parents couldn't afford to buy them. So they bought me a pair of very cheap knockoffs. Trouble is, they had FOUR stripes, not three. I was teased pretty mercelessly on the playground.
If memories from 50 years ago haunt you like this, consider spending some of that money on therapy too. If you don't have some happiness you'll be dead with millions of dollars going to distant relatives or the state.
by whiteprius
Fri Dec 15, 2017 8:13 am
Forum: Investing - Theory, News & General
Topic: Moods of the U.S. Stock Market, 1990-2017
Replies: 30
Views: 3158

Re: Moods of the U.S. Stock Market, 1990-2017

This chart is horrifyingly misleading and you should edit the OP. Why? Because it fails to reflect that P/E ratios in the early 90s were BELOW their historic average whereas P/E ratios now are wayyyyy above their historic average.

So your chart makes it seem like P/E ratios are not inflated. They are, by a lot.

Here's some useful data. http://www.multpl.com/table and http://www.multpl.com/
by whiteprius
Fri Dec 15, 2017 7:30 am
Forum: Personal Consumer Issues
Topic: How to deal with Micro-manager
Replies: 42
Views: 5471

Re: How to deal with Micro-manager

If I could offer some reality to this thread . . . Writing about these issues on here won't help and neither will any advice you get. The solution is to accept the truth that when you're an employee, you have very little rights. You need to submit to the boss's authority completely and totally, until you're able to get a different job. The delusion that an employee has any power is very dangerous. Of course, if your wife is connected with people up top then she has the power to deal with this person, but you wouldn't be posting here if that were true. So she needs to suck up and take it.
by whiteprius
Fri Dec 15, 2017 6:48 am
Forum: Personal Consumer Issues
Topic: Lexus RX 350 - new vs. preowned
Replies: 29
Views: 5068

Re: Lexus RX 350 - new vs. preowned

jlawrence01 wrote: Fri Dec 15, 2017 12:46 am I purchased a Lexus Rx350 with a navigation system for my company fleet for $42k in 2010. I sold the vehicle AT AUCTION in 2013 with 105k miles for $26k. Personally, I was stunned at how much the vehicle brought. I had offered it to a company employee for $22k but he rejected that price as outrageous.

Most Lexus vehicles depreciate very slowly.
That's amazing; I almost don't believe it, unless you live in country where it's really hard to import lexuses. Not the norm for lexuses though.
by whiteprius
Fri Dec 15, 2017 6:30 am
Forum: Personal Investments
Topic: Reached 50X annual spending. Now what?
Replies: 56
Views: 8370

Re: Reached 50X annual spending. Now what?

I'd get a bunch of cosmetic surgery and other health expenses to try and look 50 again, maybe even 40 again if you're lucky. They say you only live once but sometimes you can live twice.
by whiteprius
Fri Dec 15, 2017 6:23 am
Forum: Personal Consumer Issues
Topic: Need to find a Used/Refurbished Macbook Air
Replies: 24
Views: 2441

Re: Need to find a Used/Refurbished Macbook Air

AntsOnTheMarch wrote: Fri Dec 15, 2017 6:19 am
Sorry, don’t mean to be snide but is this a joke!? Did you read the description of this “great deal?” No better way to saddle a student with a low productivity debt than to buy this. I’d rather have pen and paper.
Pen and paper is even better. I heard a rumor that these modern computers come with a virus called "Tinder" that gives young people gonorrhea and herpes. My word what a world we live in. :annoyed
by whiteprius
Fri Dec 15, 2017 6:15 am
Forum: Personal Consumer Issues
Topic: Lexus RX 350 - new vs. preowned
Replies: 29
Views: 5068

Re: Lexus RX 350 - new vs. preowned

When I purchased my first really nice car, a +$100k car, I realized that as fancy and new as the car is on the first day -- eventually it feels like a used car. Doesn't take long either, maybe six months to a year. By then it's just another car that you'll be tired of, regardless of how much you liked it when it was new. So since then I always get used middle market cars and view them as transportation. Just make sure you get a pre purchase inspection to ensure you're not being sold a lemon and if you want extra safety get an extended warranty either a certified one from the manufacturer or one from Carmax (which has good warranties I hear).

So definitely used.
by whiteprius
Fri Dec 15, 2017 6:11 am
Forum: Personal Consumer Issues
Topic: Need to find a Used/Refurbished Macbook Air
Replies: 24
Views: 2441

Re: Need to find a Used/Refurbished Macbook Air

All she needs it for is to take notes and write papers, so there's no need to waste $800 on a Macbook Air. That's for games, youtube, instragram, tweeter, pornography and other modern nonsense; it ain't for academics. Explain to her that the $800 could be earning her interest in a mutual fund and preparing her for retirement. At 7% compounded, $800 grows to $12,000 in fourty years. Does she want to waste $12,000? Instead, you can get a perfectly good IBM laptop WITH A PRINTER TO PRINT HER TERM PAPERS ON for only $200 and I bet you could negotiate the seller down some if you tried. https://www.ebay.com/itm/Vintage-IBM-PC-5140-Convertible-Parallel-Serial-Adapter-A-C-adapter-printer/122857632252?hash=item1c9ae2b1fc:g:GucAAOSw4PxaMEWZ You're we...
by whiteprius
Thu Dec 14, 2017 3:01 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

Can all future replies state how much you personally have in the S&P 500? What we have here is you knew my bet, but I don't know yours.
by whiteprius
Thu Dec 14, 2017 2:42 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

Wouldn't it be funny if the S&P went on a huge bear run starting with today? I'll frame that article if that happens.
by whiteprius
Thu Dec 14, 2017 2:39 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

barnaclebob wrote: Thu Dec 14, 2017 2:36 pm The SP500 hasn't gone down 5% today or even close to that so why is it even relevant today?
I don't know. The fact that the S&P is on its longest no 5% loss streak in history, combined with the high P/E ratios ... all tilted things to make it seem like it was due for a fall. In light of the stress of constantly monitoring something I decided to just get out last night with a $23 gain.
by whiteprius
Thu Dec 14, 2017 2:32 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

barnaclebob wrote: Thu Dec 14, 2017 2:27 pm
Why did it take an article for you to come to know public information?
Do you really claim to know all public information?
by whiteprius
Thu Dec 14, 2017 2:26 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

slow n steady wrote: Thu Dec 14, 2017 2:25 pm
whiteprius

You posted the above comment on December 12. Is this what caused you to get back in the action?

Good luck.
Thought it was a sure thing.
by whiteprius
Thu Dec 14, 2017 2:21 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

But you were absolutely certain it was going up today. How does your brain handle this paradox? Is this a teaching moment for you? Or have you already forgotten your certain prediction from yesterday? No I wasn't, that's why I got out last night saving me from a four figure loss today. I can get out right now in overnight trading, based on the bid price, with zero gain/loss for the day, but I'm sure the S&P is going to shoot up tomorrow so I'm staying in for now. Markets will be open for another hour and 20 minutes though so I guess I'll be clicking a lot until then. Changing your narrative after the fact to fit what happened, that's a real winning strategy right there. Dood read the rest of the thread before accusing people of changin...
by whiteprius
Thu Dec 14, 2017 2:18 pm
Forum: Personal Investments
Topic: any sense in purchasing an annuity before retirement?
Replies: 35
Views: 3465

Re: any sense in purchasing an annuity before retirement?

Hmm...I've categorically heard, "avoid variable annuities," so I don't think I want to lean in that direction. I'm not sure, either, I understand mortality credits -- have to research that. Anyway, below is what inspired my question: Suppose, for the sake of a nice round number $1,000,000. If I put 500k into an annuity now, with payments starting in 5 years, I could expect $2372/mo. for life (incl. spouse) or $3853/mo. for 15 years. The other 500k would be 100% in stocks. Using the same immediateannuities calculator, if I were hypothetically 57 today, and annuitized $500k I'd receive $2075/mo. However, if waited 5 years, but put the $500k in relatively 'safe' bond funds, assuming an annual return of 3% (realistic?), it would appr...
by whiteprius
Thu Dec 14, 2017 2:07 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

HomerJ wrote: Thu Dec 14, 2017 2:05 pm
But you were absolutely certain it was going up today.

How does your brain handle this paradox? Is this a teaching moment for you? Or have you already forgotten your certain prediction from yesterday?
No I wasn't, that's why I got out last night saving me from a four figure loss today.
by whiteprius
Thu Dec 14, 2017 2:06 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

28% I'll probably move some into stocks. If it rises 60% and drops 30% I would still move into stocks. Remember I can't sell my HYB funds until 6 mos. to a year after the crash any way, thus allowing things to settle.

What is your strategy for a 30% drop? Surely you'll liquidate some of your other investments and rebalance?
by whiteprius
Thu Dec 14, 2017 1:53 pm
Forum: Personal Investments
Topic: any sense in purchasing an annuity before retirement?
Replies: 35
Views: 3465

Re: any sense in purchasing an annuity before retirement?

Grt2bOutdoors wrote: Thu Dec 14, 2017 1:49 pm SPIA's offer mortality credits when purchased in one's mid 70's and up. Variable annuities are fee sucking vacum cleaners siphoning your money into the hands of the insurance agent. You can do better usually holding low cost diversified index funds with an asset allocation that meets your requirements.
SPIA's have huge fees too, often larger than variables. They're just hidden in that lump sum you pay unlike transparent variable annuities that break them out. Insurance companies actually love SPIA's. I don't know about late 70's mortality credits but there is no reason why variable annuities shouldn't be able to offer them.

But I agree if you're going to get a variable, just invest your own money and take a little out each month.
by whiteprius
Thu Dec 14, 2017 1:46 pm
Forum: Personal Investments
Topic: any sense in purchasing an annuity before retirement?
Replies: 35
Views: 3465

Re: any sense in purchasing an annuity before retirement?

Tamarind wrote: Thu Dec 14, 2017 1:40 pm

This is not good advice. I don't recommend mixing insurance (the annuity is longevity insurance) with investing.
Many don't like variable annuities, but historically, over the long-term, they have paid more investment income (and thus a higher monthly benefit) than SPIA's. That's why they blew up in popularity once they entered the market. I can see getting an SPIA and never worrying about investing though.

I don't understand the "get an SPIA but also worry about investing the rest of your money" approach though. That's the worst of both worlds.
by whiteprius
Thu Dec 14, 2017 1:42 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

He does have a point, though, as nearly all of us believe that the expected value of holding the S&P 500 long term is positive. If I could own shares in it every day from 9:45a to 3:45p without ever putting up any money of my own or paying any interest I would totally do it. The problem of course is in the execution and the dooming effects of wide swings along the way. Execution is not a problem with Fidelity. Just place a "buy at open" order (Fidelity's systems are so fast that they always get you the opening price to the last decimal) and a "sell at the close" order. Of course, me using a "sell at the close" order yesterday instead of a "sell at 3:30pm" order is what cost me about a grand. And ...
by whiteprius
Thu Dec 14, 2017 1:22 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

I have heard many variants of this argument right before clients blew themselves up. 20 years is a very short period statistically speaking. Back-testing often hides risks when there have been secular changes. I have seen this go wrong so many times so many different ways. Overconfidence kills. Lack of darning also kills but that is a different story. Take risks but acknowledge that those risks exist and that the risks are greater than what you estimate them to be. Seriously, read up on Long Term Capital Management. Really smart guys figuring out how to make risk free money until risk blew up in their face. Plus "When Genius Failed" by Roger Lowenstein is just a fun read. The mods deleted your post and my reply so there was reall...
by whiteprius
Thu Dec 14, 2017 1:06 pm
Forum: Personal Investments
Topic: any sense in purchasing an annuity before retirement?
Replies: 35
Views: 3465

Re: any sense in purchasing an annuity before retirement?

They make sense for people like you, who don't want to bother with investing and who want a stable source of income, but try to get one indexed to inflation so you can be completely worry free and of course only buy from the highest rated gigantic insurers. Also, consider waiting a year to see how they price out after next year's rate increases. But professionals generally say to get a variable annuity (which is subject to market risk) or, even better, invest your money and take a little out each month -- because SPIA's pay too little investment income.
by whiteprius
Thu Dec 14, 2017 12:53 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

Ethelred wrote: Thu Dec 14, 2017 12:51 pm Given you've already lost $177k through bad decisions in a bull market
No the $177k loss guy (I think it was $117k) is another person who posted a different thread. Ppl are getting us confused. He bet on health-related stocks on margin longer-term. But the rest of what you wrote is true. Small intraday price movements are frighteningly unpredictable.
by whiteprius
Thu Dec 14, 2017 12:48 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

BogleMelon wrote: Thu Dec 14, 2017 12:45 pm And you were so sure that it would be higher today. How many other predication you have it wrong? :oops:
Yeah I just took margin off my account. Now if I want to get into the S&P I have to sell funds, wait 2 days for the cash to settle . . . so no more morning temptation of a free $1,000 today.
by whiteprius
Thu Dec 14, 2017 12:47 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

David Jay wrote: Thu Dec 14, 2017 12:43 pm
Correct. No amateur should ever day trade on margin.
That's fair. I took margin off my account. Investing is already worrisome enough without having to worry about margin calls.
by whiteprius
Thu Dec 14, 2017 12:35 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

I am not sure where to begin. Bogleheads use passive investing because the market portfolio - (holding a portfolio that reflects the market) - has historically been one of the most efficient portfolios (best return for unit of risk taken). We take the long view and our tilts tend to be modest. This is not you. Rapid trading - holding positions for less than a year - requires skill and discipline. You seem impulsive. First it is leveraged large caps now high yield bonds. You make a huge bet one way, panic, and then shift to the next. In less than 24 hours you have done a complete 180. There does not seem much depth to your conviction. Just a love for high risk and fast returns. You are overconfident. I have known many very smart people who ...
by whiteprius
Thu Dec 14, 2017 12:32 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

David Jay wrote: Thu Dec 14, 2017 12:28 pm
You say that but I am pretty confident that you still don't get it. YOU are the amateur here. Some professional trader on Wall Street was willing to sell you those shares.
By that logic no one should ever buy shares.
by whiteprius
Thu Dec 14, 2017 12:18 pm
Forum: Personal Investments
Topic: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?
Replies: 176
Views: 11320

Re: Thoughts on using safe-ish investments to buy S&P 500 on margin in December?

bogglehead125 wrote: Thu Dec 14, 2017 12:03 pm
Everybody in the world expected the DJIA, S&P and NASDAQ to go up today.
With all due respect, who the hell do you think sold you 6-figure amounts of SPY then? Do you think it was a charitable donation to the whiteprius fund? SPY is not penny-wide on the bid/offer because the entire world is in agreement that it is about to soar upwards.
Good point. Good news for me is SPY is down a lot right now (down 0.5), from where I sold last night. Phew!