Search found 398 matches

by RAchip
Mon May 18, 2020 6:23 pm
Forum: Investing - Theory, News & General
Topic: Dividend vs Total Return question
Replies: 66
Views: 2740

Re: Dividend vs Total Return question

Referring to dividends “VS” total return seems like a non sequitur to me. If you own a broad market fund like total market or s&p 500 your return consists of dividends and capital gains. You dont get to separate them. If you look at books that discuss “dividend investing” they mostly focus on the cl...
by RAchip
Wed Mar 04, 2020 8:18 pm
Forum: Personal Investments
Topic: Ex-Dividend date dumb question
Replies: 25
Views: 1160

Re: Ex-Dividend date dumb question

Zacks claims here that the only thing that matters is the record date, not the settlement date. So in my hypothetical scenario, I would indeed "own" BIGCO for purposes of ex-dividend, even though the trade hadn't been settled. But the "record Date" could be 3 days - for example - before the ex-divi...
by RAchip
Wed Mar 04, 2020 8:08 pm
Forum: Personal Investments
Topic: Fed rate cut probability for 2020
Replies: 8
Views: 1128

Re: Fed rate cut probability for 2020

There is little or no inflation. Interest rates will be raised when inflation returns.
by RAchip
Fri Feb 28, 2020 8:05 pm
Forum: Investing - Theory, News & General
Topic: Who's buying today? where's all the "dry powder" folks at? :)
Replies: 514
Views: 50160

Re: Who's buying today? where's all the "dry powder" folks at? :)

I put about $100k in today into 4 stocks in my portfolio that I like and that I think are worth a lot more than their current market prices. However, 100k is a small amount for me (less than 1% of my stock portfolio).
by RAchip
Fri Feb 28, 2020 7:29 pm
Forum: Investing - Theory, News & General
Topic: who is worried and feels like selling stocks?
Replies: 254
Views: 18831

Re: who is worried and feels like selling stocks?

https://www.cnn.com/2020/02/26/opinions ... index.html

Read this article. 80% of all COVID-19 cases are “mild” and require no medical intervention.
by RAchip
Fri Feb 28, 2020 8:25 am
Forum: Investing - Theory, News & General
Topic: who is worried and feels like selling stocks?
Replies: 254
Views: 18831

Re: who is worried and feels like selling stocks?

I have not sold anything and dont plan to. If the market tanks again today (friday 2/28) I will start buying individual stocks near the end of the day today. There are tremendous bargains now for long term investors. I have most of my equity investments in a portfolio of individual dividend stocks. ...
by RAchip
Thu Feb 27, 2020 10:55 am
Forum: Investing - Theory, News & General
Topic: Coronavirus and the market
Replies: 3949
Views: 296851

Re: Coronavirus and the market

https://www.cnn.com/2020/02/26/opinions ... index.html

Read this article. 80% of the cases of this virus are “mild.” The level of panic at this point is not supported by any actual facts.
by RAchip
Tue Feb 18, 2020 4:57 pm
Forum: Investing - Theory, News & General
Topic: Why do you hold bonds in your portfolio?
Replies: 296
Views: 22427

Re: Why do you hold bonds in your portfolio?

I would agree with that assessment. The OP question was "Why do you hold bonds in your portfolio?". Bonds, Cash, Money Markets, CDs, would all provide ballast and dry powder to a portfolio. I agree there is a need for ballast. However, these days with yields what they are, I think it's questionable...
by RAchip
Wed Feb 12, 2020 11:59 am
Forum: Investing - Theory, News & General
Topic: Why are you holding bonds
Replies: 161
Views: 11674

Re: Why are you holding bonds

Because I built a portfolio of safe individual municipal bonds a number of years ago from my state that is completely state and federal tax free that produces $86k in income per year (about 3.4% return on my principal investment). I wish I had just bought stocks with this money but its a modest port...
by RAchip
Wed Feb 05, 2020 2:38 am
Forum: Investing - Theory, News & General
Topic: Cap Gains & Divs killed me this year - theory
Replies: 77
Views: 12459

Re: Cap Gains & Divs killed me this year - theory

I dont understand this fear of taxes. Do you not take a job and earn income because you will have to pay taxes? Do you not put money in a bank account because it will earn interest and you will have to pay taxes? Isnt the goal of investing for many to produce income? If you want to receive income yo...
by RAchip
Wed Feb 05, 2020 2:13 am
Forum: Investing - Theory, News & General
Topic: What bonds are you buying?
Replies: 71
Views: 4610

Re: What bonds are you buying?

Since the vanguard prime mmf pays 1.63% and has basically zero risk I dont see the point in buying bond funds and taking principal risk to get a little bit more yield. So I am not buying bonds now. I have bought individual municipal bonds in the past and hold a significant 7 figure municipal bond ac...
by RAchip
Tue Feb 04, 2020 7:25 am
Forum: Investing - Theory, News & General
Topic: Cap Gains & Divs killed me this year - theory
Replies: 77
Views: 12459

Re: Cap Gains & Divs killed me this year

To the OP: would you prefer to lose money? Honestly, to call making money a problem seems silly to me. Just sell a bit or take the dividends as cash, set aside the $ needed for tax then reinvest the remainder. Someone above said: “You may have to pay taxes eventually, but you're always better off de...
by RAchip
Sun Feb 02, 2020 4:21 pm
Forum: Investing - Theory, News & General
Topic: I Prefer Dividends Over Stock Buybacks
Replies: 41
Views: 3545

Re: I Prefer Dividends Over Stock Buybacks

In accumulation mode when 0 cash flow is needed from investments, unnecessary dividends create a tax drag that stock buy backs do not. The higher an individual's tax bracket the worst it can get (e.g. 20% Fed Income Tax + 3.8% NII Tax + state income tax, etc.). I would agree. During the accumulatio...
by RAchip
Sun Feb 02, 2020 3:38 pm
Forum: Investing - Theory, News & General
Topic: Retreat to cash
Replies: 375
Views: 82985

Re: Retreat to cash

I am a buy-and-hold forever investor. But I have to admit that going all cash now until the election is over has crossed my mind.
by RAchip
Mon Jan 27, 2020 7:52 am
Forum: Investing - Theory, News & General
Topic: How do Dividends Benefit an Investor?
Replies: 178
Views: 9239

Re: How do Dividends Benefit an Investor?

The belief that the price of stock decreases permanently by the amount of a dividend is simply wrong. How the “market” values stock is not a mathematically calculated fact. Buyers consider many factors but ultimately price is determined by simple supply and demand. The willingness of a company to co...
by RAchip
Sun Jan 19, 2020 5:22 am
Forum: Investing - Theory, News & General
Topic: Ray Dalio - Worst asset you can have is cash?
Replies: 55
Views: 7339

Re: Ray Dalio - Worst asset you can have is cash?

I disagree. Holding cash gives you optionality. And it gives you some return even now; it pays roughly around 1.75% in a vanguard mmf. I plan to always hold several million in cash.
by RAchip
Tue Dec 03, 2019 6:33 am
Forum: Investing - Theory, News & General
Topic: Alternatives to Cash
Replies: 19
Views: 2313

Re: Alternatives to Cash

I think the best place to hold a material amount of “cash” is vmmxx or vusxx (if state tax free helps you). There is no true substitute for a good money market fund. Short term bond funds have principal risk. Reaching for yield on “cash” is a mistake. Just put it in vmmxx and forget it. Trying to ge...
by RAchip
Mon Dec 02, 2019 7:52 am
Forum: Investing - Theory, News & General
Topic: When a company repurchases its shares, does the company become less valuable?
Replies: 61
Views: 4633

Re: When a company repurchases its shares, does the company become less valuable?

The price of stocks in the public market is set by basic supply and demand. That is an undeniable fact. The price is not set based on any form of academic valuation, although those valuations may impact demand. Buybacks reduce supply and increase demand. These basic facts are why I always laugh when...
by RAchip
Thu Nov 28, 2019 1:51 pm
Forum: Investing - Theory, News & General
Topic: Are stocks dangerously overvalued? Not according to new Vanguard yardstick
Replies: 89
Views: 11674

Re: Are stocks dangerously overvalued? Not according to new Vanguard yardstick

My parents were 100% individual
stocks their whole lives through every up and down. It made them rich.
by RAchip
Thu Nov 28, 2019 3:44 am
Forum: Investing - Theory, News & General
Topic: Can one have too much Roth?
Replies: 175
Views: 15617

Re: Can one have too much Roth?

To me, one big advantage of a roth is that you know what you have. Everything in there is 100% yours. With a tIRA you dont know what the tax rates will be decades from now and you cant be sure what your situation will be decades from now. I like the certainty aspect.
by RAchip
Thu Nov 14, 2019 3:27 pm
Forum: Personal Finance (Not Investing)
Topic: Equal Inheritance for Children
Replies: 109
Views: 11035

Re: Equal Inheritance for Children

Using an online calculator with an interest rate of 2%: If today you were to invest $15,000.00 at a rate of 2.00%, you would have $432,674.45 at the end of 23 time periods (years). In this example the 2nd child would have to receive $432,674.45 to be even. If interest rates were 5% the result is hi...
by RAchip
Wed Nov 13, 2019 9:37 pm
Forum: Investing - Theory, News & General
Topic: Rich people are hoarding cash
Replies: 233
Views: 34889

Re: Rich people are hoarding cash

How do rich people actually hoard cash if the FDIC only insures up to 250k? I doubt they use savings accounts. MM funds typically pay a bit higher interest. No, they are not insured, but so what? I haven't had a bank savings account since I was a teenager. And that was a long time ago. FDIC insuran...
by RAchip
Sun Nov 10, 2019 5:46 pm
Forum: Investing - Theory, News & General
Topic: [Deleted]
Replies: 117
Views: 16571

Re: Long Term Bonds getting killed today

It is certainly true that if you buy individual bonds (I do) intending to hold to maturity you know exactly what you will get (ignoring the minimal default risk) — the designated interest payments plus return of par value at maturity. But I dont think its fair to say that you cant “loose money” doi...
by RAchip
Sun Nov 10, 2019 4:31 pm
Forum: Investing - Theory, News & General
Topic: [Deleted]
Replies: 117
Views: 16571

Re: Long Term Bonds getting killed today

It is certainly true that if you buy individual bonds (I do) intending to hold to maturity you know exactly what you will get (ignoring the minimal default risk) — the designated interest payments plus return of par value at maturity. But I dont think its fair to say that you cant “loose money” doin...
by RAchip
Sun Nov 10, 2019 3:52 pm
Forum: Investing - Theory, News & General
Topic: Expected Return For Bond Funds
Replies: 13
Views: 1813

Re: Expected Return For Bond Funds

“We do not know if our bond purchase will result in a capital gain or loss at the time of purchase.“ Not totally correct. If you buy a bond and intend to and do hold to maturity, you know EXACTLY what you will get (what your return will be) assuming no default. You get the interest payments specifie...
by RAchip
Sun Nov 10, 2019 3:29 pm
Forum: Investing - Theory, News & General
Topic: Why is VBTLX dropping?
Replies: 16
Views: 3686

Re: Why is VBTLX dropping?

“Don't feel bad about the NAV dropping. Now you're getting .01% more in interest going foward (unless interest rates drop, but then your NAV will go up).“ You dont get “more interest” because NAV fell. The interest payment amount is the same. The yield (interest amount divided by NAV) goes up becaus...
by RAchip
Sat Nov 09, 2019 10:13 am
Forum: Investing - Theory, News & General
Topic: Funds Missing from Vanguard Funds List
Replies: 16
Views: 2915

Re: Funds Missing from Vanguard Funds List

VUSXX does not seem to be listed either.
by RAchip
Wed Nov 06, 2019 6:32 pm
Forum: Personal Investments
Topic: MMA or Savings or Cash Management
Replies: 21
Views: 1508

Re: MMA or Savings or Cash Management

”If the financial scenario deteriorated significantly, I might back off on Prime MM, since there are liquidity gates, etc.“ Vanguard has disclosed that it has and will operate VMMXX with sufficient liquidity at all times so that the gates and fees will not be triggered. In any case, the gates and fe...
by RAchip
Tue Nov 05, 2019 9:24 pm
Forum: Personal Investments
Topic: [Why is VMMXX (Prime Money Market) ER so high?]
Replies: 27
Views: 3880

Re: [Why is VMMXX (Prime Money Market) ER so high?]

I just read the prospectus’ for the investor shares AND the admiral shares of Vanguard’s prime mmf. The prime fund (both classes) are designated as retail funds and are only open to people, not institutions. So the admiral shares are all owned by people not institutions. VMFXX has a relatively high ...
by RAchip
Tue Nov 05, 2019 9:00 pm
Forum: Personal Investments
Topic: [Why is VMMXX (Prime Money Market) ER so high?]
Replies: 27
Views: 3880

Re: [Why is VMMXX (Prime Money Market) ER so high?]

“I thus don’t think Prime MMF is the optimal choice of a MMF for individual Vanguard investors, but it is not a bad choice” If VUSXX is a better choice than VMMXX why does it only have $30bb in it vs $125bb for VMMXX? The gates etc that apply to VMMXX are not bad things — they prevent a run on the ...
by RAchip
Tue Nov 05, 2019 7:35 am
Forum: Personal Investments
Topic: [Why is VMMXX (Prime Money Market) ER so high?]
Replies: 27
Views: 3880

Re: [Why is VMMXX (Prime Money Market) ER so high?]

“I thus don’t think Prime MMF is the optimal choice of a MMF for individual Vanguard investors, but it is not a bad choice” If VUSXX is a better choice than VMMXX why does it only have $30bb in it vs $125bb for VMMXX? The gates etc that apply to VMMXX are not bad things — they prevent a run on the f...
by RAchip
Sun Nov 03, 2019 8:32 pm
Forum: Investing - Theory, News & General
Topic: Article on Dividends (J Clements)
Replies: 29
Views: 3395

Re: Article on Dividends (J Clements)

"Assuming no taxes and no impact of management's decision on buyback vs dividends on the market's reading of a stock, the two are equivalent. Let's say a company has $400 in assets, $200 in liabilities, and $200 in shareholder equity. It now distributes $20 either as a dividend or a buyback. The com...
by RAchip
Sun Nov 03, 2019 6:50 pm
Forum: Investing - Theory, News & General
Topic: Article on Dividends (J Clements)
Replies: 29
Views: 3395

Re: Article on Dividends (J Clements)

The article says that Microsoft’s best days are behind it. What a joke. As for buybacks, everyone keeps saying they are a way of returning value to stockholders. I disagree. If I dont sell, I am not getting any value. I understand the argument that buybacks MIGHT increase market price. But they mig...
by RAchip
Sun Nov 03, 2019 1:59 pm
Forum: Investing - Theory, News & General
Topic: Article on Dividends (J Clements)
Replies: 29
Views: 3395

Re: Article on Dividends (J Clements)

The article says that Microsoft’s best days are behind it. What a joke. As for buybacks, everyone keeps saying they are a way of returning value to stockholders. I disagree. If I dont sell, I am not getting any value. I understand the argument that buybacks MIGHT increase market price. But they mig...
by RAchip
Sun Nov 03, 2019 10:26 am
Forum: Investing - Theory, News & General
Topic: Article on Dividends (J Clements)
Replies: 29
Views: 3395

Re: Article on Dividends (J Clements)

The article says that Microsoft’s best days are behind it. What a joke. As for buybacks, everyone keeps saying they are a way of returning value to stockholders. I disagree. If I dont sell, I am not getting any value. I understand the argument that buybacks MIGHT increase market price. But they migh...
by RAchip
Sat Nov 02, 2019 9:46 am
Forum: Investing - Theory, News & General
Topic: When someone says “X is a $120 million dollar company” what does that mean?
Replies: 20
Views: 2546

Re: When someone says “X is a $120 million dollar company” what does that mean?

Almost always a reference to gross revenue in connection with a private company.
by RAchip
Fri Nov 01, 2019 7:54 am
Forum: Personal Investments
Topic: Worried I am getting addicted to individual stocks.
Replies: 113
Views: 8330

Re: Worried I am getting addicted to individual stocks.

I have a lot of money (8 figures) in an individual buy-and-hold stock portfolio (21 blue chip dividend paying stocks). All I can say is that this strategy has worked for me. How does your total return compare to VTSAX? I dont know how to calculate that since I am constantly adding to my portfolio.
by RAchip
Thu Oct 31, 2019 8:39 pm
Forum: Personal Investments
Topic: Worried I am getting addicted to individual stocks.
Replies: 113
Views: 8330

Re: Worried I am getting addicted to individual stocks.

I have a lot of money (8 figures) in an individual buy-and-hold stock portfolio (21 blue chip dividend paying stocks). All I can say is that this strategy has worked for me. Thanks for the input. Do you ever add/replace a stock? What factors do you consider if you do? I rarely sell but I have done ...
by RAchip
Thu Oct 31, 2019 4:01 pm
Forum: Personal Investments
Topic: Worried I am getting addicted to individual stocks.
Replies: 113
Views: 8330

Re: Worried I am getting addicted to individual stocks.

I have a lot of money (8 figures) in an individual buy-and-hold stock portfolio (21 blue chip dividend paying stocks). All I can say is that this strategy has worked for me.
by RAchip
Tue Oct 29, 2019 6:48 am
Forum: Personal Investments
Topic: I’m done with index funds
Replies: 229
Views: 30257

Re: I’m done with index funds

You want to buy individual stocks and hope some are losers so you can sell at a loss to offset gains elsewhere? Why not buy individual stocks that go up in value? You will have to pay capital gains tax but you will end up with more money. I think it is a mistake to let tax strategy drive investment ...
by RAchip
Mon Oct 28, 2019 9:31 pm
Forum: Personal Investments
Topic: High Yield Funds in Taxable Account--what to do?
Replies: 19
Views: 1403

Re: High Yield Funds in Taxable Account--what to do?

“There have been many discussions on Bogleheads on the subject of tax efficiency. A search for those words should turn up a lot of information“ Umm, dividends are tax efficient. They are (currently) taxed the same as long term capital gains. If the concern is state income tax, move to a more “tax ef...
by RAchip
Mon Oct 28, 2019 8:55 pm
Forum: Personal Investments
Topic: High Yield Funds in Taxable Account--what to do?
Replies: 19
Views: 1403

Re: High Yield Funds in Taxable Account--what to do?

I dont get it. You dont want to make money because you have to pay tax on your income? Making money is a good thing. That is the objective. If you dont want to pay state income tax, move to a state with no income tax. It seems axiomatic to me, but selling successful investments because they produce...
by RAchip
Mon Oct 28, 2019 7:49 pm
Forum: Personal Investments
Topic: High Yield Funds in Taxable Account--what to do?
Replies: 19
Views: 1403

Re: High Yield Funds in Taxable Account--what to do?

I dont get it. You dont want to make money because you have to pay tax on your income? Making money is a good thing. That is the objective. If you dont want to pay state income tax, move to a state with no income tax. It seems axiomatic to me, but selling successful investments because they produce ...
by RAchip
Thu Oct 24, 2019 7:00 pm
Forum: Personal Investments
Topic: Top tax bracket for life, taking RMDs, stop making 401k contributions?
Replies: 22
Views: 2031

Re: Top tax bracket for life, taking RMDs, stop making 401k contributions?

Their RMD’s are $600,000?

At some point you can stop “saving for retirement.” When my net worth got above $30mm it just seemed to me that what was in my 401k really wouldnt matter and I stopped contributing. 401k’s are for regular people, not UHNW people.
by RAchip
Wed Oct 23, 2019 5:32 pm
Forum: Personal Finance (Not Investing)
Topic: Do you plan to actually spend down your portfolio?
Replies: 353
Views: 29605

Re: Do you plan to actually spend down your portfolio?

I expect to spend a good portion. I am going to owe a lot of estate taxes so im going to try to spend most of that part instead of letting the govt have it.
by RAchip
Sun Oct 20, 2019 2:44 pm
Forum: Investing - Theory, News & General
Topic: hymb, dividends, portfolio.
Replies: 15
Views: 1561

Re: hymb, dividends, portfolio.

Regarding dividends, it is generally accepted that “the market” normally values public corporations operating as a going concern based on the present value of anticipated future earnings. Accordingly, cash held in a going concern company that is not needed to produce the anticipated future earnings ...
by RAchip
Sun Oct 20, 2019 2:25 pm
Forum: Investing - Theory, News & General
Topic: Safe Withdrawal Rate in today’s low yield environment
Replies: 44
Views: 4316

Re: Safe Withdrawal Rate in today’s low yield environment

“Right, but that wouldn't keep up with inflation.“ There is little or no inflation. That is why interest rates are minimal to non existent. There could well be deflation in which case you make money by not investing. If inflation comes back, interest rates will rise and you can just put your money i...
by RAchip
Sun Oct 20, 2019 1:41 pm
Forum: Investing - Theory, News & General
Topic: Safe Withdrawal Rate in today’s low yield environment
Replies: 44
Views: 4316

Re: Safe Withdrawal Rate in today’s low yield environment

“My guess - and that's all it is - is that in 20 or 30 years Bogleheads will have settled somewhere in the 2-3% range.“

2%? If you put your money in a safe and take out 2% of the initial balance per year your money will last 50 years.
by RAchip
Sat Oct 19, 2019 11:36 pm
Forum: Personal Investments
Topic: Bonds or just use Money Market/ Savings??
Replies: 25
Views: 3892

Re: Bonds or just use Money Market/ Savings??

”The bond's purpose is not for the return. Its purpose is actually to dilute the return and to limit the losses of stocks.“

If this is really the case then a MM is the better choice.