Search found 9173 matches

by willthrill81
Mon Apr 22, 2019 1:33 pm
Forum: Investing - Theory, News & General
Topic: Why should stocks beat bonds in the long run?
Replies: 95
Views: 5214

Re: Why should stocks beat bonds in the long run?

Is this a behavioral outcome rather than a completely rational decision? If investors were rational and only invested in enterprises that adequately compensated them for "risk" then bubbles would never happen. To take it a (disturbing) step further, is it possible that with the increasing popularit...
by willthrill81
Mon Apr 22, 2019 1:25 pm
Forum: Investing - Theory, News & General
Topic: "Second-Grader Who Beat Wall Street -- A Decade Later"
Replies: 32
Views: 6044

Re: "Second-Grader Who Beat Wall Street -- A Decade Later"

The lazy portfolios are just starting points for which assets are recommended. One could argue the sub-allocation of certain portfolios is what makes them unique. For instance, if they equal-weight all their stock allocations, or split their bond allocation 50/50 between two types of bonds. (That i...
by willthrill81
Mon Apr 22, 2019 1:16 pm
Forum: Investing - Theory, News & General
Topic: "Second-Grader Who Beat Wall Street -- A Decade Later"
Replies: 32
Views: 6044

Re: "Second-Grader Who Beat Wall Street -- A Decade Later"

Frankly, there is a poster here who very much appears to exhibit strong confirmation bias of the 3-fund portfolio, boasting about its relative returns vs. other portfolios when it's doing well but then stating that past performance is not indicative of future performance when it's doing relatively ...
by willthrill81
Mon Apr 22, 2019 11:54 am
Forum: Investing - Theory, News & General
Topic: "Second-Grader Who Beat Wall Street -- A Decade Later"
Replies: 32
Views: 6044

Re: "Second-Grader Who Beat Wall Street -- A Decade Later"

I agree that, at a bare minimum, portfolios' relative performance as reflected by absolute returns cannot be compared to one another if their stock vs. bond allocation varies. Frankly, there is a poster here who very much appears to exhibit strong confirmation bias of the 3-fund portfolio, boasting ...
by willthrill81
Mon Apr 22, 2019 11:49 am
Forum: Personal Finance (Not Investing)
Topic: Delayed gratification.
Replies: 53
Views: 5103

Re: Delayed gratification.

Hello Bogleheads. First post here. I'm curious how people deal with the emotions surrounding delayed gratification. For example, I'm a resident physician who has >$300,000 in student loans. I moonlight for extra cash to ensure I can max my Roth IRA and add a little to my 403b and wifes 401K. I bike...
by willthrill81
Mon Apr 22, 2019 11:46 am
Forum: Investing - Theory, News & General
Topic: Stocks will return about 4% annually over the next decade or so rather than the 10% average annual returns - John Bogle
Replies: 88
Views: 11321

Re: Stocks will return about 4% annually over the next decade or so rather than the 10% average annual returns - John Bo

It's really simple math... 4% = 25 x yearly expenses. So , 25 years and you are out of money at 0% real growth, ie 100% TIPS(-ish). All you need to do is calculate what interest rate you need to earn in todays dollars to run out of money after 30 years. There are literally dozens of online calculat...
by willthrill81
Mon Apr 22, 2019 11:42 am
Forum: Investing - Theory, News & General
Topic: Efficient Markets Indeed
Replies: 40
Views: 2954

Re: Efficient Markets Indeed

It it's necessary, this from Investopedia : The Efficient Market Hypothesis, or EMH, is an investment theory whereby share prices reflect all information and consistent alpha generation is impossible . Theoretically, neither technical nor fundamental analysis can produce risk-adjusted excess return...
by willthrill81
Mon Apr 22, 2019 9:32 am
Forum: Investing - Theory, News & General
Topic: "Second-Grader Who Beat Wall Street -- A Decade Later"
Replies: 32
Views: 6044

Re: "Second-Grader Who Beat Wall Street -- A Decade Later"

I love this line which summarizes active investing in a nutshell: It’s still a bad idea to pay one expert to outsmart other experts, . . . Unfortunately it also sums up market efficiency, which is what makes passive investing viable Actually, passive indexing's historic viability can be much more c...
by willthrill81
Mon Apr 22, 2019 9:29 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Variance Risk Premium Evidence
Replies: 13
Views: 371

Re: Larry Swedroe: Variance Risk Premium Evidence

In general options markets implied volatility is greater than realized volatility. This does not necessarily reflect a market inefficiency, rather it more likely reflects a risk premium participants are willing to pay for price protection. I would recommend inserting the above. We know that there a...
by willthrill81
Mon Apr 22, 2019 9:23 am
Forum: Investing - Theory, News & General
Topic: Efficient Markets Indeed
Replies: 40
Views: 2954

Re: Efficient Markets Indeed

It it's necessary, this from Investopedia : The Efficient Market Hypothesis, or EMH, is an investment theory whereby share prices reflect all information and consistent alpha generation is impossible . Theoretically, neither technical nor fundamental analysis can produce risk-adjusted excess return...
by willthrill81
Mon Apr 22, 2019 9:09 am
Forum: Personal Investments
Topic: Thinking about selling stocks near all time highs
Replies: 96
Views: 8290

Re: Thinking about selling stocks near all time highs

I am thinking about selling some stock ETFs after one of the strongest gains in the stock market since christmas 2018. I know that this slope that we're on cannot continue and has never historically continued at this rate, so a correction is inevitable. We're on pace for nearly a 60% return for the...
by willthrill81
Sun Apr 21, 2019 11:11 pm
Forum: Personal Investments
Topic: Thinking about selling stocks near all time highs
Replies: 96
Views: 8290

Re: Thinking about selling stocks near all time highs

Thanks for all of the responses. I will need to decide on a more realistic asset allocation that I can stomach. I think that 90/10 is still too risky for me given the 7 figure net worth that I have mostly invested in the stock market. I cannot stomach losing over $500,000 in another great recession...
by willthrill81
Sun Apr 21, 2019 11:08 pm
Forum: Personal Finance (Not Investing)
Topic: New car loan - Interest rate
Replies: 6
Views: 700

Re: New car loan - Interest rate

I am planning to buy a new car and car finance company (Subaru) has 3.49% interest rate for 36-60 months. I checked the below institutions to compare: Lightstream - 3.99% Penfed - 3.49 (48 months), 3.74% (60m) Navy fed credit - 3.69 (37-60m) Digital CU - 4.24% Does anyone know if there is any bank/...
by willthrill81
Sun Apr 21, 2019 10:23 pm
Forum: Investing - Theory, News & General
Topic: Why should stocks beat bonds in the long run?
Replies: 95
Views: 5214

Re: Why should stocks beat bonds in the long run?

We expect that businesses borrowing at one rate (i.e. bond interest rate) will only do so if they expect to outperform that rate through their own ventures (i.e. stock returns) over the long-run. Exactly. Not necessarily. Why would businesses borrow when the cost of capital exceeds their expected r...
by willthrill81
Sun Apr 21, 2019 7:33 pm
Forum: Investing - Theory, News & General
Topic: Stocks will return about 4% annually over the next decade or so rather than the 10% average annual returns - John Bogle
Replies: 88
Views: 11321

Re: Stocks will return about 4% annually over the next decade or so rather than the 10% average annual returns - John Bo

Remember that if there were no volatility present, the '4% rule' would succeed over a 30 year period with an average real return of just 1.22%. Sorry would you be able to explain that last sentence I haven't heard that before so not quite sure what you mean. It's really simple math... 4% = 25 x yea...
by willthrill81
Sun Apr 21, 2019 7:32 pm
Forum: Investing - Theory, News & General
Topic: Efficient Markets Indeed
Replies: 40
Views: 2954

Re: Efficient Markets Indeed

EMH states current price reflects all available information. However, it doesn't state the information has to be correct information. Price may reflect incorrect information, which is the case in OP example. If the information is not incorporated 'correctly' , however that is defined, then the prac...
by willthrill81
Sun Apr 21, 2019 5:14 pm
Forum: Investing - Theory, News & General
Topic: Efficient Markets Indeed
Replies: 40
Views: 2954

Re: Efficient Markets Indeed

EMH states current price reflects all available information. However, it doesn't state the information has to be correct information. Price may reflect incorrect information, which is the case in OP example. If the information is not incorporated 'correctly', however that is defined, then the pract...
by willthrill81
Sun Apr 21, 2019 9:58 am
Forum: Personal Finance (Not Investing)
Topic: Mr. Money Mustache, SWR, and equity allocation
Replies: 524
Views: 39092

Re: Mr. Money Mustache, SWR, and equity allocation

My argument was that all the failure scenarios of the 4 percent rule involve retiring the day week or months before a Black swan event. Well being "retired" for a few months before a major economic shaking event which will result in lots of unemployment will not make you less hireable. I don't thin...
by willthrill81
Sat Apr 20, 2019 10:05 pm
Forum: Investing - Theory, News & General
Topic: a percentage decline is MORE than that decline OF YOUR GAINS??
Replies: 29
Views: 2198

Re: a percentage decline is MORE than that decline OF YOUR GAINS??

venkman wrote:
Sat Apr 20, 2019 10:00 pm
Just use the Dave Ramsey SystemTM, where volatility drag doesn't exist, and your CAGR always equals the arithmetic average of your annual gains! :twisted:
And your safe withdrawal rate will be 8% too! :mrgreen:
by willthrill81
Sat Apr 20, 2019 10:02 pm
Forum: Personal Finance (Not Investing)
Topic: Mr. Money Mustache, SWR, and equity allocation
Replies: 524
Views: 39092

Re: Mr. Money Mustache, SWR, and equity allocation

You just need to be more skilled enough or more lucky enough than your coworker. If so you will survive, else not. Corporations drill into you that “getting yourself more skilled” will fetch you jobs/ lets you keep jobs. Until they don’t need you or your increased skill any more. Two can play the g...
by willthrill81
Sat Apr 20, 2019 9:38 pm
Forum: Investing - Theory, News & General
Topic: The Annuity Puzzle: Findings from a Recent Survey
Replies: 37
Views: 2361

Re: The Annuity Puzzle: Findings from a Recent Survey

montanagirl wrote:
Sat Apr 20, 2019 9:06 pm
Do most pensions not have adjustment for inflation?
No, most do not.
by willthrill81
Sat Apr 20, 2019 8:53 pm
Forum: Personal Finance (Not Investing)
Topic: Where do you keep your emergency fund?
Replies: 62
Views: 5374

Re: Where do you keep your emergency fund?

Don’t have an EF now that the taxable account is large enough. Those for whom the primary emergency that would need funding is unemployment and who also have a 457 plan (i.e. penalty-free withdrawals at any age once separated from the employer) may have no need for an EF at all once the 457 plan ha...
by willthrill81
Sat Apr 20, 2019 7:20 pm
Forum: Investing - Theory, News & General
Topic: Jason Zweig WSJ: You, Dear Investor,Are Patient, Prudent And Calm
Replies: 22
Views: 3046

Re: Jason Zweig WSJ: You, Dear Investor,Are Patient, Prudent And Calm

This confirms my own belief that us individual investors have one advantage over the big boys. We don’t have our results compared to an index by a board of directors quarterly and risk losing jobs if we underperform. Knowing our own goals and timeframes, we can afford to be more patient. :thumbsup ...
by willthrill81
Sat Apr 20, 2019 7:11 pm
Forum: Personal Finance (Not Investing)
Topic: Where do you keep your emergency fund?
Replies: 62
Views: 5374

Re: Where do you keep your emergency fund?

1/3 in hard cash, 2/3 in Wellesley Income (in a Roth IRA). New to the forum and joined after reading this. 36 year old newbie and just set up a Vanguard account. Never thought about holding some in anything other than cash. Got a lot to learn, but thanks for the post. Makes sense to me to do someth...
by willthrill81
Sat Apr 20, 2019 5:49 pm
Forum: Investing - Theory, News & General
Topic: Vanguard kicking butt with Target Date Funds
Replies: 22
Views: 4962

Re: Fund Placement

Bogleheads: Low cost Target Date Funds are usually the best investments for investors who have ALL their portfolio in tax-advantaged accounts (IRAs, 401ks, etc.). Target Date Funds, like other balanced funds, are tax-inefficient. In such cases, it is usually better to use separate funds so that we ...
by willthrill81
Sat Apr 20, 2019 5:09 pm
Forum: Investing - Theory, News & General
Topic: Efficient Markets Indeed
Replies: 40
Views: 2954

Re: Efficient Markets Indeed

If a market is inefficient, that means that there are good opportunities for some people to make speculative gains by taking money away from other people. I'm not so sure that that conclusion is valid. For instance, if the market's pricing was 'random', it wouldn't be efficient, but you couldn't pr...
by willthrill81
Sat Apr 20, 2019 5:06 pm
Forum: Investing - Theory, News & General
Topic: Efficient Markets Indeed
Replies: 40
Views: 2954

Re: Efficient Markets Indeed

Are you willing to tell us your understanding of the term efficient markets ? PJW Was just being sarcastic with the title. But I'd venture to say that the price of a stock going up hundreds of times because it gets confused with a different company doesn't seem very efficient! This example you gave...
by willthrill81
Sat Apr 20, 2019 12:32 pm
Forum: Investing - Theory, News & General
Topic: The Annuity Puzzle: Findings from a Recent Survey
Replies: 37
Views: 2361

Re: The Annuity Puzzle: Findings from a Recent Survey

It has been well known for a long time that people tend to not like SPIAs. Kitces explained the issue a couple of years ago via the theory of the retirement hierarchy of needs, which has since received some support in the academic community. Basically, it argues that individuals' need for current in...
by willthrill81
Sat Apr 20, 2019 12:07 pm
Forum: Personal Finance (Not Investing)
Topic: Mr. Money Mustache, SWR, and equity allocation
Replies: 524
Views: 39092

Re: Mr. Money Mustache, SWR, and equity allocation

Here is a real-life cautionary tale about FIRE. A friend FIREd in her mid 40's (shortly before the dot-com bust), took her pension as a lump sum, and set up an SEPP from her roll-over IRA. I'm not privy to her multiple of expenses at the start of her retirement, but I know the mandatory RMDs did a ...
by willthrill81
Sat Apr 20, 2019 11:24 am
Forum: Personal Finance (Not Investing)
Topic: Mr. Money Mustache, SWR, and equity allocation
Replies: 524
Views: 39092

Re: Mr. Money Mustache, SWR, and equity allocation

There is a reasonable difference between 3% and low 3.x percent as x can equal anything between 0 and 5. The only reasonable study I saw that discusses this is Early Retirement Now that recommends 3.5%. And that 3.5% is without any flexibility making it very conservative and 3.0% overly conservativ...
by willthrill81
Sat Apr 20, 2019 11:07 am
Forum: Personal Finance (Not Investing)
Topic: Mr. Money Mustache, SWR, and equity allocation
Replies: 524
Views: 39092

Re: Mr. Money Mustache, SWR, and equity allocation

You don't have to work during the great depression, you can do something lucrative and decrease your SWR ahead of it. Huh? Do something "lucrative"? In the middle of the biggest economic meltdown in the history of the US? I think you would benefit from reading some history of this period. Yes, beca...
by willthrill81
Sat Apr 20, 2019 11:03 am
Forum: Investing - Theory, News & General
Topic: a percentage decline is MORE than that decline OF YOUR GAINS??
Replies: 29
Views: 2198

Re: a percentage decline is MORE than that decline OF YOUR GAINS??

I guess what I'm asking is: 1. is this a reason to periodically take gains off the table (to reduce the loss to one's gains)? Not really. Your portfolio doesn't 'know' what proportion of itself is comprised of contributions or gains. 2. even if you experience losses of your gains does this favor lo...
by willthrill81
Sat Apr 20, 2019 10:54 am
Forum: Investing - Theory, News & General
Topic: a percentage decline is MORE than that decline OF YOUR GAINS??
Replies: 29
Views: 2198

Re: a percentage decline is MORE than that decline OF YOUR GAINS??

What got me thinking about this was I thought the market has been up 300% since the Great Recession. And I wondered, if the market falls by 50% wouldn't those who were up 300% still be up 150% (half of the total increase?). But then I thought, "Well if I started with $100 and it's now up 300% I'd h...
by willthrill81
Sat Apr 20, 2019 10:47 am
Forum: Investing - Theory, News & General
Topic: This could be the biggest risk that retirees face?
Replies: 117
Views: 8083

Re: This could be the biggest risk that retirees face?

Living to 100 is peanuts. We will have much longer lifespans. This will not be the case if life expectancies continue increasing at their current pace. Take a look at the graph below. https://i.imgur.com/G4KSEHz.png?1 From 1850 to 1950, the life expectancy of a 70 year old only increased from about...
by willthrill81
Sat Apr 20, 2019 10:45 am
Forum: Personal Finance (Not Investing)
Topic: Mr. Money Mustache, SWR, and equity allocation
Replies: 524
Views: 39092

Re: Mr. Money Mustache, SWR, and equity allocation

You don't have to work during the great depression, you can do something lucrative and decrease your SWR ahead of it. Huh? Do something "lucrative"? In the middle of the biggest economic meltdown in the history of the US? I think you would benefit from reading some history of this period. Just to p...
by willthrill81
Sat Apr 20, 2019 10:37 am
Forum: Investing - Theory, News & General
Topic: Stocks will return about 4% annually over the next decade or so rather than the 10% average annual returns - John Bogle
Replies: 88
Views: 11321

Re: Stocks will return about 4% annually over the next decade or so rather than the 10% average annual returns - John Bo

Except that the new normal is closer to a 40 year retirement than 30. So more opportunity for bad sequences of returns. The longer the retirement, the more likely a run of high inflation. In the long run, inflation is just as much a threat as sequence of returns. That's why it's important to have t...
by willthrill81
Sat Apr 20, 2019 10:35 am
Forum: Investing - Theory, News & General
Topic: Stocks will return about 4% annually over the next decade or so rather than the 10% average annual returns - John Bogle
Replies: 88
Views: 11321

Re: Stocks will return about 4% annually over the next decade or so rather than the 10% average annual returns - John Bo

I guess the point is if there's a high likelihood that the next decade is going to be 4% returns or less should you look at alternatives such as real estate etc. or pay off mortgage instead? Also lower returns are fine if you are going to be working for the next 30 years, but what about newly retir...
by willthrill81
Sat Apr 20, 2019 10:30 am
Forum: Investing - Theory, News & General
Topic: This could be the biggest risk that retirees face?
Replies: 117
Views: 8083

Re: This could be the biggest risk that retirees face?

Why I Hope to Die at 75 by Ezekiel J. Emanuel (Ezekiel J. Emanuel is an oncologist, a bioethicist, and a vice provost of the University of Pennsylvania. He is the author or editor of 10 books, including Brothers Emanuel and Reinventing American Health Care. ) https://getpocket.com/explore/item/why-...
by willthrill81
Sat Apr 20, 2019 12:01 am
Forum: Investing - Theory, News & General
Topic: Stocks will return about 4% annually over the next decade or so rather than the 10% average annual returns - John Bogle
Replies: 88
Views: 11321

Re: Stocks will return about 4% annually over the next decade or so rather than the 10% average annual returns - John Bo

I guess the point is if there's a high likelihood that the next decade is going to be 4% returns or less should you look at alternatives such as real estate etc. or pay off mortgage instead? Also lower returns are fine if you are going to be working for the next 30 years, but what about newly retir...
by willthrill81
Fri Apr 19, 2019 11:56 pm
Forum: Investing - Theory, News & General
Topic: This could be the biggest risk that retirees face?
Replies: 117
Views: 8083

Re: This could be the biggest risk that retirees face?

You're doing it wrong if you aren't planning with "preservation of capital" in mind. Down curve year over year should follow inflation, not spending. -TheDDC So retirees should plan as though they will live forever? I believe the term to describe would be closer to "generational wealth". That does ...
by willthrill81
Fri Apr 19, 2019 10:26 pm
Forum: Investing - Theory, News & General
Topic: This could be the biggest risk that retirees face?
Replies: 117
Views: 8083

Re: This could be the biggest risk that retirees face?

TheDDC wrote:
Fri Apr 19, 2019 9:56 pm
You're doing it wrong if you aren't planning with "preservation of capital" in mind. Down curve year over year should follow inflation, not spending.

-TheDDC
So retirees should plan as though they will live forever?
by willthrill81
Fri Apr 19, 2019 10:25 pm
Forum: Investing - Theory, News & General
Topic: This could be the biggest risk that retirees face?
Replies: 117
Views: 8083

Re: This could be the biggest risk that retirees face?

I'm not aware of any models that allow some sort of "if portfolio drops below by x%" (or some similar trigger), "then reduce spending by y% for z years", or some such. There are a million models. Coding up a new model is pretty straightforward. Here's what yours looks like. If the portfolio drops 1...
by willthrill81
Fri Apr 19, 2019 10:22 pm
Forum: Personal Finance (Not Investing)
Topic: Mr. Money Mustache, SWR, and equity allocation
Replies: 524
Views: 39092

Re: Mr. Money Mustache, SWR, and equity allocation

I tend to think that the withdrawal rate is pretty age dependent, Why? From the data we have until now there is a very small difference between perpetual and 30y SWRs. Of course there is the question of what sample size can you have with perpetual (or even 30y intervals), but that is a different di...
by willthrill81
Fri Apr 19, 2019 6:38 pm
Forum: Personal Finance (Not Investing)
Topic: Mr. Money Mustache, SWR, and equity allocation
Replies: 524
Views: 39092

Re: Mr. Money Mustache, SWR, and equity allocation

Those who are able to retire on a 2% withdrawal rate have the option of transitioning to a 4% rate and live large. Those who retire on a 4% withdrawal rate cannot increase it to 8% to achieve the same result. The problem remains that it will take most folks 10 years or longer to go from a 4% WR to ...
by willthrill81
Fri Apr 19, 2019 6:25 pm
Forum: Personal Investments
Topic: Can we retire yet? And other related questions...
Replies: 29
Views: 2847

Re: Can we retire yet? And other related questions...

Emergency funds: 19 months of expenses Debt: None, rent at 2300/mo Tax Filing Status: Married Tax Rate: 24% Federal, 6.37% State State of Residence: NJ Age: M62, F58 Desired Asset allocation: 100% stocks / 0% bonds Desired International allocation: 30% of stocks Portfolio: 3.2m (or 3.6m?) Current r...
by willthrill81
Fri Apr 19, 2019 6:09 pm
Forum: Personal Finance (Not Investing)
Topic: Mr. Money Mustache, SWR, and equity allocation
Replies: 524
Views: 39092

Re: Mr. Money Mustache, SWR, and equity allocation

But I am worried about time. And even if my job was 6h/day and across the street from my house, I would still have an issue with the fact that I am pinned down in the same place and I cannot go where I want. I echo your concern. While I really enjoy my job, I do not believe that I would do it if we...
by willthrill81
Fri Apr 19, 2019 5:51 pm
Forum: Personal Investments
Topic: Thinking about selling stocks near all time highs
Replies: 96
Views: 8290

Re: Thinking about selling stocks near all time highs

You should sell. It always works out when you sell at market highs. Unless the market keeps going up. If you have reached your goals and won the game then you, IMO, should start managing your risk and not worry about maximizing gains. If you would have made a few dollars more by staying in wouldn't...
by willthrill81
Fri Apr 19, 2019 4:34 pm
Forum: Personal Investments
Topic: Thinking about selling stocks near all time highs
Replies: 96
Views: 8290

Re: Thinking about selling stocks near all time highs

tainted-meat wrote:
Fri Apr 19, 2019 4:21 pm
You should sell. It always works out when you sell at market highs.
Unless the market keeps going up.
by willthrill81
Fri Apr 19, 2019 1:13 pm
Forum: Personal Finance (Not Investing)
Topic: Mr. Money Mustache, SWR, and equity allocation
Replies: 524
Views: 39092

Re: Mr. Money Mustache, SWR, and equity allocation

But if one can reasonably get from 40 times expenses to 50 times expenses in 3 or 4 years, and as a result have a better chance of surviving all but the most catastrophic of situations, isn't that trade off worth it? Maybe not for someone who is 60 years old, but someone who is 50 it might be. And ...
by willthrill81
Fri Apr 19, 2019 1:04 pm
Forum: Investing - Theory, News & General
Topic: This could be the biggest risk that retirees face?
Replies: 117
Views: 8083

Re: This could be the biggest risk that retirees face?

Living to age 99 is a risk I am willing to take.. :D My plan is to retire at 62, postpone SS to age 67 (possibly 70, if health is good, will see..), and enjoy life as much as I can, as long as I can. Withdraw at 3.75 -4% for 5 years, then reduce it to 2% after SS kicks in. I don't expect to need mu...