Search found 4722 matches

by stlutz
Sun Oct 21, 2018 2:07 pm
Forum: Investing - Theory, News & General
Topic: US Large Cap Value - valuation?
Replies: 7
Views: 317

Re: US Large Cap Value - valuation?

The trailing PE for the Vanguard [Large Cap] value fund is 20.6. https://www.etf.com/VTV I wouldn't call that cheap. Let's keep in mind a two things: 1) Value stocks have not done poorly over the past decade. They have gone up. A lot. Just not as much as growth stocks have. 2) Historically value out...
by stlutz
Sun Oct 21, 2018 2:01 pm
Forum: Investing - Help with Personal Investments
Topic: Long Term Bonds for Young Retirement Investors
Replies: 5
Views: 356

Re: Long Term Bonds for Young Retirement Investors

Using the "Simba" spreadsheet, here are the returns, volatility, and Sharpe Ratio of 3 distinct periods in time: 1960-1980 LT: CAGR: 7.29% St. Dev. 13.62% Sharpe Ratio. .19 IT: CAGR: 7.69% St. Dev. 13.60% Sharpe .21 ST: CAGR: 7.98% St. Dev. 13.67% Sharpe .23 1981-2000 LT: CAGR: 14.11% St. Dev. 12.33...
by stlutz
Sun Oct 21, 2018 11:23 am
Forum: Investing - Theory, News & General
Topic: Is there a case for Active in fixed income?
Replies: 4
Views: 383

Re: Is there a case for Active in fixed income?

Given that there are about 5 threads going on now promoting various approaches to timing the bond market, the opinion of the forum seems to be "yes". :?
by stlutz
Sun Oct 21, 2018 1:11 am
Forum: Investing - Theory, News & General
Topic: Allan Roth doesn't like single premium annuities
Replies: 198
Views: 10337

Re: Allan Roth doesn't like single premium annuities

I'm not stuck on 'safe withdrawal rates', but the bottom line is that any withdrawal method that is not based on a percentage of the portfolio's balance (i.e. has some 'fixed' element to it) has some degree of exposure to sequence of returns risk. Dear Willthrill81, It's mathematics: VPW doesn't ha...
by stlutz
Sat Oct 20, 2018 9:34 pm
Forum: Personal Finance (Not Investing)
Topic: Consumer Price Index and medication etc. Why TIPS?
Replies: 5
Views: 516

Re: Consumer Price Index and medication etc. Why TIPS?

The bond market doesn't really care about the price of your particular medication. Right now the yield difference between a nominal 10 year bond and a 10 year TIPS is about 2.1%. If CPI-U inflation is higher than that, then TIPS will perform better; if CPI-U inflation is lower, then nominal bonds wo...
by stlutz
Sat Oct 20, 2018 6:56 pm
Forum: Investing - Theory, News & General
Topic: Total Bond Market Fund - interest rates rising!
Replies: 86
Views: 7527

Re: Total Bond Market Fund - interest rates rising!

A few years back I did a backtest using the Simba/Siamond spreadsheet and concluded that in a 60/40 portfolio, bank CDs historically would have needed to yield 1.2% above a 5 year Treasury to provide the equivalent portfolio return and volatility as an intermediate term Treasury fund. https://www.bo...
by stlutz
Wed Oct 17, 2018 11:48 pm
Forum: Investing - Help with Personal Investments
Topic: Investing in Roth IRA: Hitting mutual fund limits at the beginning
Replies: 16
Views: 1236

Re: Investing in Roth IRA: Hitting mutual fund limits at the beginning

What is your 401K invested in? The most commonly recommended approach here is to look at all of your assets as a single porfolio as opposed to treating each account separately.

For example, you may just use standard total market funds in your 401K and then use your Roth IRA for the tilts.
by stlutz
Mon Oct 15, 2018 7:10 pm
Forum: Investing - Help with Personal Investments
Topic: Start a Treasury Ladder... or not?
Replies: 17
Views: 2225

Re: Start a Treasury Ladder... or not?

The yield pickup between buying a 4 month bill vs. a 6 month bill is not that much. Agree with this too, but that was not the comparison. The comparison was a 6-month Treasury ladder to the Vanguard Treasury MM fund. For that comparison, the 6-month ladder has a higher yield (without compromising a...
by stlutz
Mon Oct 15, 2018 6:58 pm
Forum: Investing - Help with Personal Investments
Topic: Have you annuitized some of your money?
Replies: 67
Views: 5650

Re: Have you annuitized some of your money?

Thanks for the input :D . If I create my own portfolio using a mix of Treasury and investment grade corporate bonds to wind up with that same 3.8% return, I am taking risk in the corporate bond arena. If I am willing to take risk of that degree with these funds, than I would want a higher return th...
by stlutz
Mon Oct 15, 2018 8:46 am
Forum: Investing - Help with Personal Investments
Topic: Start a Treasury Ladder... or not?
Replies: 17
Views: 2225

Re: Start a Treasury Ladder... or not?

That sounds an awful like Vanguard Treasury Money Market fund. What you are you trying to gain from DIY? I think the OP is looking to ladder 6-month Treasuries. The Vanguard fund I believe has an average duration of just a touch under 60 days. So there is decent yield pickup from laddering the 6-mo...
by stlutz
Sun Oct 14, 2018 6:54 pm
Forum: Investing - Help with Personal Investments
Topic: Have you annuitized some of your money?
Replies: 67
Views: 5650

Re: Have you annuitized some of your money?

I have been playing around with the idea of a 15 year annuity to bridge the gap between 52 to 67 as part of a FIRE plan. The annuity would run out and SS would start up to take the place of the monthly annuity income at age 67. Anyone consider this and have thoughts? Also, in comparing annuities, w...
by stlutz
Sun Oct 14, 2018 3:06 pm
Forum: Investing - Theory, News & General
Topic: Do recessions follow tax cuts?
Replies: 2
Views: 414

Re: Do recessions follow tax cuts?

In before the lock.

The market usually goes up after a tax cut. The market usually goes up after a tax increase.
by stlutz
Sun Oct 14, 2018 2:08 pm
Forum: Investing - Help with Personal Investments
Topic: Start a Treasury Ladder... or not?
Replies: 17
Views: 2225

Re: Start a Treasury Ladder... or not?

That sounds an awful like Vanguard Treasury Money Market fund. What you are you trying to gain from DIY?
by stlutz
Sun Oct 14, 2018 1:51 pm
Forum: Investing - Theory, News & General
Topic: Is EMH a tautology?
Replies: 108
Views: 4636

Re: Is EMH a tautology?

I think what has made EMH both useful and problematic is it's dependence on an agreed-upon understanding of how to measure risk, which there isn't one. That has made EMH a rather elastic concept. Value stocks are a case in point. Some would argue that if one type of stock consistently produces a hig...
by stlutz
Sun Oct 14, 2018 1:12 pm
Forum: Investing - Theory, News & General
Topic: Is EMH a tautology?
Replies: 108
Views: 4636

Re: Is EMH a tautology?

triceratop wrote:
Sat Oct 13, 2018 5:47 pm
There is a good discussion between Thaler and Fama with Andrew Lo on Youtube, here.
Thanks for sharing the video--I enjoyed listening to it!
by stlutz
Sat Oct 13, 2018 11:46 pm
Forum: Investing - Theory, News & General
Topic: Intermediate Treasuries ETF - SCHR vs VSIGX?
Replies: 4
Views: 396

Re: Intermediate Treasuries ETF - SCHR vs VSIGX?

Things have changed since that older thread. The VG funds switched to following a pure Treasury index. So, both the VG fund and the Schwab ETF follow a 3-10 year Treasury index now. So, they are fully equivalent in terms of their portfolios.
by stlutz
Sat Oct 13, 2018 8:27 pm
Forum: Investing - Theory, News & General
Topic: Intermediate Treasuries ETF - SCHR vs VSIGX?
Replies: 4
Views: 396

Re: Intermediate Treasuries ETF - SCHR vs VSIGX?

They are equivalent. It really makes no difference whatsoever.
by stlutz
Fri Oct 12, 2018 9:56 pm
Forum: Investing - Theory, News & General
Topic: Does Fidelity offer the best index products for a passive investor compared to Vanguard
Replies: 61
Views: 5415

Re: Does Fidelity offer the best index products for a passive investor compared to Vanguard

While it's not true that a Vanguard fund is always the best choice, it will never be a bad choice. Overall, they are the best investment manager around. On the other hand, Fidelity is a better broker than Vanguard. You can buy a Vanguard ETF anywhere. On the other hand, if you want VG mutual funds, ...
by stlutz
Fri Oct 12, 2018 3:59 pm
Forum: Personal Finance (Not Investing)
Topic: Best Checking/ System for Cash Management/ Sweeping?
Replies: 11
Views: 1414

Re: Best Checking/ System for Cash Management/ Sweeping?

even Fidelity charges 1%, enough to dissuade me
To clarify, this is for debit card purchases, not ATM withdrawals.

I've been a big fan of Schwab Bank in the past, but have been moving over to the Fidelity solution because they make the whole money market fund thing much easier than Schwab.
by stlutz
Wed Oct 10, 2018 9:47 pm
Forum: Investing - Theory, News & General
Topic: Really bad days (RBDs) and porfolio performance
Replies: 67
Views: 10208

Re: Really bad days (RBDs) and porfolio performance

RBDs were also comprehensively addressed in this thread:

viewtopic.php?t=149161
by stlutz
Wed Oct 10, 2018 8:40 pm
Forum: Investing - Theory, News & General
Topic: Debunking Bonds in Taxable
Replies: 38
Views: 3075

Re: Debunking Bonds in Taxable

The other problem is that tax laws change. It hasn't always been the case that long-term capital gains and dividends got favorable treatment. It's very possible that the same could happen in the future. The problem with optimizing is that you're optimizing for right now, which might be different fro...
by stlutz
Wed Oct 10, 2018 8:30 pm
Forum: Investing - Theory, News & General
Topic: Diversifying with a zero-correlation, zero-return volatile asset
Replies: 66
Views: 3543

Re: Diversifying with a zero-correlation, zero-return volatile asset

If you're talking expectations, the answer would be (a). The coin flip either slightly increases or decreases your return and it and reduces your standard deviation. Result is that you end up with a higher Sharpe ratio. If you're talking actual returns, it completely depends, as your expected zero r...
by stlutz
Tue Oct 09, 2018 7:43 pm
Forum: Investing - Help with Personal Investments
Topic: Fidelity treasury money market (FZFXX) subject to state tax?
Replies: 10
Views: 901

Re: Fidelity treasury money market (FZFXX) subject to state tax?

This is the page you are looking for: https://www.fidelity.com/tax-information/fidelity-mutual-fund-tax-information The percentage of income from US government securities file shows that it got 53% of it's income from such securities last year. This is the only portion exempt from state tax. If you ...
by stlutz
Tue Oct 09, 2018 7:40 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth doesn't like single premium annuities
Replies: 198
Views: 10337

Re: Allan Roth doesn't like single premium annuities

One side note--thanks to Allan Roth for joining the discussion! :sharebeer
by stlutz
Tue Oct 09, 2018 7:40 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth doesn't like single premium annuities
Replies: 198
Views: 10337

Re: Allan Roth doesn't like single premium annuities

One of the advantages of a SPIA over a standard pension is that you have a choice of when to buy one, which you can determine based on factors like: --age - --health -- no need to buy one if I have a terminal illness at age 65 --wealth--I'd rather turn assets into income after a long bull market tha...
by stlutz
Tue Oct 09, 2018 7:36 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth doesn't like single premium annuities
Replies: 198
Views: 10337

Re: Allan Roth doesn't like single premium annuities

Comparing the a 3% COLA annuity vs. one w/o a COLA is pretty simple math as well. I just compared one for a 65 year old male and it's not until age 87 that the COLA one comes out ahead in terms of total payments (income? :D ). That COLA seems rather pricey. For me, if I just wanted the stable income...
by stlutz
Sun Oct 07, 2018 9:52 pm
Forum: Investing - Help with Personal Investments
Topic: Secondary CD questions - what do I get at maturity?
Replies: 3
Views: 665

Re: Secondary CD questions - what do I get at maturity?

You would have put in: $99,825 + $100 commission = $99,925
You would get out: $100,000 + $2400 interest = $102,400.

The full amount of interest and market discount ($2475) would be taxable at your regular income rate.
by stlutz
Sun Oct 07, 2018 4:47 pm
Forum: Investing - Help with Personal Investments
Topic: Taxable - Would you switch from Vanguard to Fidelity (iShares ETFs) for $1000 a year?
Replies: 19
Views: 2271

Re: Taxable - Would you switch from Vanguard to Fidelity (iShares ETFs) for $1000 a year?

I think you're merging a few questions together that don't really have to be. You can determine whether a Vanguard ETF or an iShares ETF is cheaper to hold independent of where you hold it. You can trade iShares at Vanguard for free; you can trade Vanguard at Fidelity for free if you transfer holdin...
by stlutz
Sun Oct 07, 2018 4:37 pm
Forum: Investing - Help with Personal Investments
Topic: Long or medium bonds
Replies: 88
Views: 5519

Re: Long or medium bonds

If equities hit the fan, you want a bond asset that counteracts the drop. Long bonds do this better than short bonds. Sometimes they have; sometimes they haven't. The long-term correlation of bonds to stocks is about zero as opposed to being substantially negative. For my investing lifetime, long-t...
by stlutz
Sun Oct 07, 2018 4:33 pm
Forum: Investing - Help with Personal Investments
Topic: Long or medium bonds
Replies: 88
Views: 5519

Re: Long or medium bonds

However, I believe that this compensation is inadequate for nominal bonds . Insurance companies and pension funds with fixed-dollar long-term liabilities have no inflation risk, and thus do not demand a risk premium for long-term bonds over shorter-term bonds. This bids down the yield, making them ...
by stlutz
Sun Oct 07, 2018 11:35 am
Forum: Investing - Theory, News & General
Topic: Flattening yield curve
Replies: 55
Views: 4809

Re: Flattening yield curve

Upthread poster stlutz linked a supportive article, but poster aristotelian sank it as evidence for cause and effect The article I liked to argued that an inverted yield curve "predicts" a recession because it leads to specific behavior by lenders and borrowers that leads to a credit crunch and a d...
by stlutz
Sun Oct 07, 2018 11:24 am
Forum: Investing - Theory, News & General
Topic: Getting the best part of the yield curve without DFA
Replies: 3
Views: 381

Re: Getting the best part of the yield curve without DFA

You can use a combination of bond funds/ETFs to achieve the average duration you are targeting. Regardless, I don't actually see any "magic" in this strategy. It backtests very well in the 70s and 80s because you would have used shorter-term bonds when rates and inflation were consistently going up ...
by stlutz
Sun Oct 07, 2018 2:05 am
Forum: Investing - Help with Personal Investments
Topic: I'm unclear on how to use a Vanguard account
Replies: 21
Views: 1768

Re: I'm unclear on how to use a Vanguard account

You'll put in a sell order for Tuesday ( since the market is closed Monday ) and then you'll but the Vanguard funds on Wednesday.
by stlutz
Sat Oct 06, 2018 8:58 pm
Forum: Investing - Help with Personal Investments
Topic: Secondary CD questions - what do I get at maturity?
Replies: 3
Views: 665

Re: Secondary CD questions - what do I get at maturity?

I was looking at brokered CDs, and trying to understand the numbers better. Please help me understand: 1) Let' say I put $100,000 into this on or around 10/15/2018. You couldn't put exactly $100K in. It would have to be $99,825 (+$100 in commission cost). What should I expect back when it matures o...
by stlutz
Sat Oct 06, 2018 5:31 pm
Forum: Investing - Theory, News & General
Topic: Flattening yield curve
Replies: 55
Views: 4809

Re: Flattening yield curve

I don't see any consistent superiority of one over the other. In terms of where I got this notion: https://www.frbsf.org/economic-research/publications/economic-letter/2018/august/information-in-yield-curve-about-future-recessions/ And they agree that no one particular measurement has clearly domin...
by stlutz
Sat Oct 06, 2018 5:20 pm
Forum: Investing - Theory, News & General
Topic: Vanguard's Shtekman and Xu beat Asness: Alt. Strategies (VASFX) vs. AQR (QSPIX)!
Replies: 18
Views: 1122

Re: Vanguard's Shtekman and Xu beat Asness: Alt. Strategies (VASFX) vs. AQR (QSPIX)!

Based on all history to date, the only question I have is why one would want either one. I did get a kick out of this line from the annual report for the VG fund: "The strongest driver of performance during the period was our positioning in commodity-linked investments, which led to the fund's bigg...
by stlutz
Sat Oct 06, 2018 1:33 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth doesn't like single premium annuities
Replies: 198
Views: 10337

Re: Alan Roth doesn't like single premium annuities

I have not run the numbers on this scenario but I wonder if a strategy that starts with a CD-based approach and then has a trigger for when to buy an annuity (if ever) might be the best of all options? When I have time, I'll look into that. I am not sure if the right trigger would be one spouse dyi...
by stlutz
Sat Oct 06, 2018 11:43 am
Forum: Investing - Theory, News & General
Topic: Allan Roth doesn't like single premium annuities
Replies: 198
Views: 10337

Re: Alan Roth doesn't like single premium annuities

Yes, an approach using CDs could "fail". For people age 70, 20% of men and 33% women are expected to be alive at age 90. However, only 10% of the time do both partners in a couple achieve age 90 together. But if one is in that "lucky" group that lives past 90, it could be a BIG problem if adjustmen...
by stlutz
Sat Oct 06, 2018 11:29 am
Forum: Investing - Help with Personal Investments
Topic: Whew! Stock market is no longer at all-time highs, so ...
Replies: 34
Views: 5377

Re: Whew! Stock market is no longer at all-time highs, so ...

Almost on cue, the "US Stocks in freefall" thread appears to have gotten bumped. :D
by stlutz
Sat Oct 06, 2018 11:21 am
Forum: Investing - Theory, News & General
Topic: Allan Roth doesn't like single premium annuities
Replies: 198
Views: 10337

Re: Alan Roth doesn't like single premium annuities

Financially, annuities are a usually not a clear winner versus investing in a rolling ladder of safer, FDIC-insured CDs unless people really think they will live well past their life expectancy. For instance at age 70, a $100,000 purchase of a joint life, SPIA would "payout" $6,276 per year. Starti...
by stlutz
Sat Oct 06, 2018 11:05 am
Forum: Investing - Theory, News & General
Topic: Best way to exchange ETFs to minimize trading costs?
Replies: 8
Views: 459

Re: Best way to exchange ETFs to minimize trading costs?

In practice, I've found I'm losing about 5 bp during an exchange How have you calculated this? Willing to share an example? This thread ( https://www.bogleheads.org/forum/viewtopic.php?f=10&t=230817) started on a different topic but ultimately became about how ETF liquidity and trading works. (The ...
by stlutz
Sat Oct 06, 2018 10:56 am
Forum: Investing - Help with Personal Investments
Topic: Margin account for TLH
Replies: 9
Views: 690

Re: Margin account for TLH

The handling will likely be different for a mutual fund vs. an ETF. When you sell an ETF, it doesn't settle for two days, but the broker knows exactly how much money you are going to receive for the sale. As such, most brokers will allow you to trade with those unsettled funds. When you enter a sell...
by stlutz
Sat Oct 06, 2018 3:59 am
Forum: Investing - Theory, News & General
Topic: T. Rowe Price brokerage account
Replies: 4
Views: 503

Re: T. Rowe Price brokerage account

Aren't T Rowe Price mutual funds on the NTF list at most brokerages (e.g. Fidelity, Schwab etc.)? Those are much less expensive brokerage platforms overall.
by stlutz
Sat Oct 06, 2018 3:52 am
Forum: Investing - Theory, News & General
Topic: Where is that value premium?
Replies: 57
Views: 4080

Re: Where is that value premium?

Possibility 4: Measurement artifact. ... I mean since Jun 2000, Vanguard Small Cap Growth Index I VSGIX has had a positive loading on value at 0.05%. Ok not significant, but how can the growth and value indexes both have a positive value loading? Is it that the more lottery type growth stocks are w...
by stlutz
Fri Oct 05, 2018 10:11 pm
Forum: Investing - Theory, News & General
Topic: SLYV vs IJS [SPDR vs. iShares S&P 600 Small Cap Value]
Replies: 201
Views: 10019

Re: SLYV vs IJS [SPDR vs. iShares S&P 600 Small Cap Value]

I just bought 90 shares of VIOO on Vanguard Highest bid was $156.15. I did a limit order at $156.22. It got executed at $156.09. Would that be normal? I didn't see my trade on https://www.etf.com/VIOO#tradability . Any place where I can see them? You can register at surveyorapp.trlm.com and look at...
by stlutz
Fri Oct 05, 2018 9:54 pm
Forum: Investing - Theory, News & General
Topic: 7 Investing Truths That Aren't
Replies: 53
Views: 5864

Re: 7 Investing Truths That Aren't

#5 Investing Should Be Fun
I bought a Treasury Bond today and found it to be quite exciting. :sharebeer
by stlutz
Fri Oct 05, 2018 9:50 pm
Forum: Investing - Help with Personal Investments
Topic: Long or medium bonds
Replies: 88
Views: 5519

Re: Long or medium bonds

Just to throw a wrench into things: It has been noted in other threads that ST bonds have consistent produced a higher Sharpe Ratio than LT bonds. As such, it's better from a portfolio efficiency perspective to lever up the ST bonds (by using 2 year Treasury futures) than it is to lever by using lon...
by stlutz
Fri Oct 05, 2018 9:36 pm
Forum: Investing - Help with Personal Investments
Topic: Portfolio Allocation/Fidelity Assistance
Replies: 3
Views: 321

Re: Portfolio Allocation/Fidelity Assistance

If I had your 401K, I would limit myself to the following 2 funds: Fidelity® 500 Index Fund - Premium Class (FUSVX) FID INVST GR BD (FBNDX) I agree with the others that I'd seek the international exposure once I had an IRA setup. And regarding that, given that your 401K options are OK but not great,...