Search found 627 matches

by venkman
Wed Aug 15, 2018 9:29 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Betting Against Beta
Replies: 12
Views: 1291

Re: Larry Swedroe: Betting Against Beta

It seems like the findings boil down to: Stocks with less price movement tend to outperform during periods when stock prices are high, and more likely to go down.

Makes sense to me. :happy
by venkman
Sun Aug 12, 2018 4:55 pm
Forum: Investing - Theory, News & General
Topic: Massive small cap tilt with low equity AA - anybody do this?
Replies: 9
Views: 941

Re: Massive small cap tilt with low equity AA - anybody do this?

If I recall correctly, factor returns on REITs can be explained as if REITs were 60% small value stocks and 40% high-yield bonds.

I'm personally a fan of the SCV tilt, but it may not be good diversification if your portfolio is already heavy in real estate.
by venkman
Tue Aug 07, 2018 1:53 am
Forum: Investing - Theory, News & General
Topic: "Don't Obsess About Expense Ratios"
Replies: 232
Views: 19160

Re: "Don't Obsess About Expense Ratios"

Pre-Fidelity announcement: "Lowest expense ratio possible is essential!" Post-Fidelity announcement: "Actually, don't worry about them! Stay with Vanguard!" This explains why absolutely no one here owns Wellesley or Wellington. The .22/.25 ER's violate the essential BH rule to only invest in the fu...
by venkman
Sun Aug 05, 2018 9:41 pm
Forum: Investing - Theory, News & General
Topic: How are muni rates determined?
Replies: 25
Views: 1625

Re: how are muni rates determined?

If the buyer pays a premium for a higher-interest thousand bond (face value $1000), and the computed premium (let's assume $200 for this) is based on the market interest rate, isn't the city really paying only the market interest rate on the total ($1200) received? When the bond is called early, do...
by venkman
Sat Aug 04, 2018 10:59 pm
Forum: Investing - Theory, News & General
Topic: How does one become a financial advisor?
Replies: 34
Views: 2268

Re: How does one become a financial advisor?

maybe im not being clear. there would be no management, no AUM, no executing trades. just pay per use, review/consulting type of info. like my example: show me your 401k options, here is the best portfolio you can make in this % based on you AA, etc, etc. thank you, that will be $100. Series 65 and...
by venkman
Sat Aug 04, 2018 10:20 pm
Forum: Investing - Theory, News & General
Topic: How are muni rates determined?
Replies: 25
Views: 1625

Re: how are muni rates determined?

About 8 years ago my city approved $30M in bonds with a maximum interest rate of 8% 4 years ago we approved $100M with a maximum rate of 6% This year we are looking at $135M and the maximum rate has gone up to 12%! The first two were for infrastructure; the new bond is for affordable housing. The c...
by venkman
Fri Aug 03, 2018 9:44 pm
Forum: Investing - Theory, News & General
Topic: Is schwab TSM index fund serving 2 masters?
Replies: 29
Views: 3139

Re: Is schwab TSM index fund serving 2 masters?

The MM funds are not the problem. Where investors lose out is when the sweep fund is held as bank deposits in a bank owned by the firm, and that sweep fund yields little more than 0. Investors then have to continually be diligent to keep that sweep fund balance to a minimum by moving funds around. ...
by venkman
Thu Aug 02, 2018 10:33 pm
Forum: Investing - Theory, News & General
Topic: STIP (Short Term TIP) yield vs TIP
Replies: 14
Views: 917

Re: STIP (Short Term TIP) yield vs TIP

If short-term TIPS are yielding essentially the same as long-term TIPS, it means:

1. The market is inefficient.
OR
2. The market is pricing some risk other than term risk into short-term TIPS.

When in doubt, it's probably best to assume markets are efficient....
by venkman
Wed Aug 01, 2018 9:05 pm
Forum: Investing - Theory, News & General
Topic: how to invest money not needed for 3-5 years?
Replies: 3
Views: 841

Re: how to invest money not needed for 3-5 years?

Assuming you plan to use the money in 3-5 years, I think you should just keep it in your guaranteed 3% account, at least for now. If short-term CD's go significantly above 3% at some point, you might switch to those. But 3-5 years is much too short a time frame to be in the stock market. Any high-di...
by venkman
Mon Jul 30, 2018 9:16 pm
Forum: Investing - Help with Personal Investments
Topic: Taxable investing
Replies: 9
Views: 1437

Re: Taxable investing

I am hoping to get some direction on what my best options are for a taxable investment, I think most of my tax-deferred options are utilized, here is a summary of our situation. -We contribute 1k a month to a brokerage account, it is currently in Life Strategy income (65k balance) -Cash on hand - a...
by venkman
Sun Jul 29, 2018 9:38 pm
Forum: Investing - Help with Personal Investments
Topic: 1 year treasuries @ 2.4% instead of bond funds?
Replies: 32
Views: 3591

Re: 1 year treasuries @ 2.4% instead of bond funds?

if stocks crash the 1 year treasury will rally too (assuming the crash is before maturity). BND gives me interest rate risk. if the yield curve steepens i could get capital losses with BND With 1-year treasuries, you have reinvestment risk. If the economy goes into recession and the stock market cr...
by venkman
Sat Jul 28, 2018 9:52 pm
Forum: Investing - Theory, News & General
Topic: Passive Index Investing, A Bubble Bound To Burst?
Replies: 114
Views: 11474

Re: Passive Index Investing, A Bubble Bound To Burst?

The data for Vanguard funds that follows raises a serious question regarding the long-term superiority of index funds over managed funds. - Target Retirement Income (VTINX) : $1,024,942 - Life Strategy Conservative Growth (VSCGX) : $1,061,585 - Wellesley Income (VWINX) : $1,271,377 The argument isn...
by venkman
Sat Jul 28, 2018 2:03 am
Forum: Investing - Help with Personal Investments
Topic: VWITX (Vanguard Intermediate Term Tax Exempt) Question
Replies: 9
Views: 1605

Re: VWITX (Vanguard Intermediate Term Tax Exempt) Question

Can anyone help me understand why there is the difference shown below, I am investing in VWITX because I want high quality TE bonds, but now I am not so sure...thanks A particular style box rating doesn't mean 100% of the bonds fall into that category. (e.g. VBILX-Vanguard's Intermediate Bond Index...
by venkman
Sat Jul 28, 2018 1:37 am
Forum: Investing - Theory, News & General
Topic: Passive Index Investing, A Bubble Bound To Burst?
Replies: 114
Views: 11474

Re: Passive Index Investing, A Bubble Bound To Burst?

Informed investors seeking a margin of safety should hunt for stocks that have been largely ignored and excluded by passive index/ETF products, especially those with high insider ownership. So, the "safe" bet is stocks that didn't pass the screens for quality, liquidity, etc.? And most of the peopl...
by venkman
Sat Jul 28, 2018 1:14 am
Forum: Investing - Theory, News & General
Topic: Asset Allocation if bond fund currently holds 3% short term?
Replies: 6
Views: 782

Re: Asset Allocation if bond fund currently holds 3% short term?

Presumably, the cash is yielding something. And given the current yield curve, the cash probably isn't trailing that far behind some of the short-term bonds in the fund. I'd just count it all as bonds.
by venkman
Thu Jul 26, 2018 9:51 pm
Forum: Personal Finance (Not Investing)
Topic: The stock that got away
Replies: 40
Views: 2899

Re: The stock that got away

Just because nothing bad happened to your house doesn't mean it was a waste of money to buy homeowner's insurance... :happy
by venkman
Tue Jul 24, 2018 10:26 pm
Forum: Investing - Theory, News & General
Topic: Any reason to hold junk bond fund?
Replies: 50
Views: 4362

Re: Any reason to hold junk bond fund?

ChinchillaWhiplash wrote:
Tue Jul 24, 2018 10:07 am
Is it worth the risk to put a portion of your bond portfolio in a fund like PGHY Investco global short term high yield bond etf ER = 0.35 yield = 5.27%.
Is it worth the risk, generally speaking? Perhaps.

Is it CURRENTLY worth the risk? No.

https://fred.stlouisfed.org/series/BAMLH0A2HYB
by venkman
Sun Jul 22, 2018 10:03 pm
Forum: Investing - Theory, News & General
Topic: Bonds: VG Treasury Funds vs ETFs vs Ladders
Replies: 21
Views: 2066

Re: Bonds: VG Treasury Funds vs ETFs vs Ladders

Q2: is it worth the time and effort to make a Treasury ladder instead of just picking one or more of these Treasury funds/ETFs? Specifically can one expect some number of basis points better return by doing a ladder? And are there other pros / cons of either choice? Once you get a ladder fully in p...
by venkman
Wed Jul 18, 2018 9:51 pm
Forum: Investing - Help with Personal Investments
Topic: The future for long term bond index funds? i.e. VWALX
Replies: 5
Views: 697

Re: The future for long term bond index funds? i.e. VWALX

I assume that these older (higher rate) bonds are probably propping up the current distributions and compensating for the newer (lower yield) bonds. But as these long term older (higher rate) bonds are replaced with long term lower rate bonds, I would assume that the overall distributions are going...
by venkman
Sun Jul 15, 2018 8:42 pm
Forum: Investing - Help with Personal Investments
Topic: want to improve returns by 1%/year on a portfolio
Replies: 6
Views: 841

Re: want to improve returns by 1%/year on a portfolio

The only way to get higher expected return is to take more risk (i.e. more money in stocks). And it looks like she already has plenty of equity risk for someone who wants to retire in 7 years. Under normal circumstances, it would be entirely reasonable to expect at least a 5% return from a 65/35-ish...
by venkman
Sat Jul 14, 2018 10:35 pm
Forum: Investing - Theory, News & General
Topic: Getting antsy with indexing? Reporter doing story.
Replies: 12
Views: 2933

Re: Getting antsy with indexing? Reporter doing story.

A reporter for a well-known publication is looking to talk to investors who are getting antsy with passive investing, and who may have even pulled out of ETFs these past six months. There's "passive investing,' and then there's "active investing using index ETF's." It almost sounds like the reporte...
by venkman
Fri Jul 13, 2018 9:05 pm
Forum: Investing - Theory, News & General
Topic: M* vs Fool.com Charts
Replies: 9
Views: 937

Re: M* vs Fool.com Charts

It looks like the Fool chart is only showing price growth, while the M* chart is showing total growth, including reinvested dividends.
by venkman
Thu Jul 12, 2018 10:36 pm
Forum: Investing - Theory, News & General
Topic: what is the historical real return of total bond?
Replies: 15
Views: 1377

Re: what is the historical real return of total bond?

According to Portfolio Visualizer: https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=4&startYear=1985&firstMonth=1&endYear=2018&lastMonth=12&endDate=07%2F12%2F2018&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&reb...
by venkman
Thu Jul 12, 2018 10:28 pm
Forum: Investing - Theory, News & General
Topic: Bonds in rising interest rate environment
Replies: 12
Views: 1110

Re: Bonds in rising interest rate environment

Interest rates had been close to zero since the end of 2008. There were quite few years when it was predictable that they would rise, but never did.
by venkman
Thu Jul 12, 2018 10:19 pm
Forum: Personal Finance (Not Investing)
Topic: Shifting from Intermediate to Short-term Bonds
Replies: 11
Views: 1651

Re: Shifting from Intermediate to Short-term Bonds

If a 1-2% loss over 6 months is enough to make you consider selling off those assets, then your 60% allocation to stocks is FAR too high...
by venkman
Wed Jul 11, 2018 10:55 pm
Forum: Investing - Help with Personal Investments
Topic: Buying CDs from Vanguard
Replies: 20
Views: 2621

Re: Buying CDs from Vanguard

Note that Vanguard has a $10k minimum for each new-issue CD you purchase. You may be able to find secondary CD's that have a lower minimum. How do I know if I’m getting a good deal? For secondary CD's, It will list the yield to maturity you'd get. Just make sure that number is at least slightly hig...
by venkman
Wed Jul 11, 2018 10:44 pm
Forum: Investing - Help with Personal Investments
Topic: Best way to automatically invest in Vanguard ETFs
Replies: 6
Views: 803

Re: Best way to automatically invest in Vanguard ETFs

If this is a case where the ER is higher because you have Investor shares instead of Admiral shares, I wouldn't even bother with the ETF's. The actual extra dollar amount you pay for Investor shares doesn't become significant until you're well past the point where you qualify for Admiral shares. If ...
by venkman
Wed Jul 11, 2018 10:16 pm
Forum: Investing - Theory, News & General
Topic: Does tilting towards shorter-term bonds make sense?
Replies: 15
Views: 1829

Re: Does tilting towards shorter-term bonds make sense?

This may be borderline anti-boglehead philosophy, but has anyone here similarly adjusted their bond duration? And if you don't, what's the rationale for maintaining longer duration bonds when, as I understand it, you're getting less risk-adjusted-return compared to short-term bonds as the yield cur...
by venkman
Wed Jul 11, 2018 2:48 am
Forum: Investing - Help with Personal Investments
Topic: 401(k) Asset Allocation for 23 Year Old
Replies: 10
Views: 610

Re: 401(k) Asset Allocation for 23 Year Old

Assuming she has the risk tolerance for it, she should be fine to be 100% equities right now. For the first few years, the contributions she's making will add to the account far more than the returns.

And, she can always open an IRA and put the bonds there, in funds with lower expense ratios.
by venkman
Sun Jul 08, 2018 11:47 pm
Forum: Investing - Theory, News & General
Topic: Is it contradictory to be a Boglehead and have substantial allocation towards SCV?
Replies: 30
Views: 2350

Re: Is it contradictory to be a Boglehead and have substantial allocation towards SCV?

How do those who invest in SCV reconcile with those foundational principles? Jack Bogle himself has noted that SCV has underperformed the S&P 500 for vast periods of time. The foundational principle underlying ALL financial markets is that risk and reward are positively correlated. Investors will d...
by venkman
Fri Jul 06, 2018 9:26 pm
Forum: Investing - Theory, News & General
Topic: Active Management Justification
Replies: 33
Views: 2013

Re: Active Management Justification

This paragraph, buried at the very end of the MGIAX prospectus, is why your broker is pushing it on you: Payments to Broker/Dealers and Other Financial Intermediaries If you purchase shares of the fund through a broker/dealer or other financial intermediary (such as a bank), the fund, MFS, and/or MF...
by venkman
Thu Jul 05, 2018 10:04 pm
Forum: Investing - Theory, News & General
Topic: Fundrise vs. Vanguard REIT ETF
Replies: 10
Views: 1286

Re: Fundrise vs. Vanguard REIT ETF

On the surface, Vanguard charges no brokerage commissions and carries only a low investment advisory fee of 0.30%, which it reports to be lower than the industry standard of 1.02%. In addition to the advisory fee, Vanguard charges its REIT ETF investors an asset management fee of 0.11% as well as r...
by venkman
Thu Jul 05, 2018 9:48 pm
Forum: Investing - Theory, News & General
Topic: Comparing bonds with different maturities
Replies: 6
Views: 522

Re: Comparing bonds with different maturities

An easy example might be a 10 year bond yielding 3.00% vs. a 5 year bond yielding 2.99%. Seemingly very few retail investors would prefer the 10 year bond risk at those rates. But how do you calculate the 'tipping point' at which the 10 year bond does become more compelling? By definition, quite a ...
by venkman
Wed Jul 04, 2018 10:29 pm
Forum: Investing - Theory, News & General
Topic: Switch to LT bonds in this falling rate environment?
Replies: 44
Views: 3155

Re: Switch to LT bonds in this falling rate environment?

Kevin M wrote:
Wed Jul 04, 2018 10:08 pm
This is not rational, but purely a form of anchoring.
Anchoring when stocks are very highly valued seems pretty rational to me. :happy
by venkman
Wed Jul 04, 2018 10:13 pm
Forum: Investing - Theory, News & General
Topic: Index Fund vs. ETF for Long Term Investment
Replies: 21
Views: 1777

Re: Index Fund vs. ETF for Long Term Investment

I can meet the $3000 balance for the Investor Share. I am just trying to understand the trade-off since the expense ratio for ETF (0.04%) is lower than Investor Share (0.14%) and ETF has no requirements. I can see that it is simpler to start off with index fund. Thank you for the advice! :happy At ...
by venkman
Wed Jul 04, 2018 9:42 pm
Forum: Investing - Theory, News & General
Topic: Switch to LT bonds in this falling rate environment?
Replies: 44
Views: 3155

Re: Switch to LT bonds in this falling rate environment?

BLV (Vanguard Long Term Bond Index ETF) has an SEC yield just shy of 4% right now. 4% is what Jack Bogle is predicting for stock returns over the next decade. From that perspective, LT bonds look pretty good in terms of risk/reward. Obviously, not everyone is predicting stock returns as low as 4%, b...
by venkman
Tue Jul 03, 2018 10:50 pm
Forum: Investing - Help with Personal Investments
Topic: Buying CDs from Vanguard
Replies: 20
Views: 2621

Re: Buying CDs from Vanguard

Note that Vanguard has a $10k minimum for each new-issue CD you purchase. You may be able to find secondary CD's that have a lower minimum.
by venkman
Sat Jun 30, 2018 9:05 pm
Forum: Investing - Help with Personal Investments
Topic: Help with Total Investment Strategy - Windfall
Replies: 30
Views: 2399

Re: Help with Total Investment Strategy - Windfall

To be honest I am really struggling with the bond aspect given where we’re at with interest rates as well as the amount that I should be investing in bonds; I know that bonds in a taxable account is not tax efficient but I have no choice if I want to diversify with bonds. I really don’t want to go ...
by venkman
Fri Jun 29, 2018 9:20 pm
Forum: Investing - Help with Personal Investments
Topic: Starting the "Three Fund Portfolio"
Replies: 13
Views: 2256

Re: Starting the "Three Fund Portfolio"

So with all that said the question I have is does it make sense to initially open the account with $10,000 dollars in each to get to the admiral share status or should I just stick with my allocation strategy when I first open the account? The investor shares will cost you less than $20 extra per y...
by venkman
Fri Jun 29, 2018 9:06 pm
Forum: Investing - Theory, News & General
Topic: Does Bogle’s Reversion to Mean tenet have practical utility?
Replies: 4
Views: 511

Re: Does Bogle’s Reversion to Mean tenet have practical utility?

Does this hold any practical utility for someone who is entering retirement in your view If so, what? I think it suggests you might want to be more in bonds than you would be if equity valuations were lower. Assuming the reversion happens over the next 10 years, it will be in the form of: 1. A cras...
by venkman
Thu Jun 28, 2018 9:46 pm
Forum: Investing - Theory, News & General
Topic: Dave Ramsey against index funds?
Replies: 57
Views: 5866

Re: Dave Ramsey against index funds?

I don't agree with the 12% returns he uses as an example, not saying those funds he owns did or did not produce those returns, they very well may have, but the average listener may think that past is prologue and that is where the disagreement comes, you can buy any fund you like, or as many as the...
by venkman
Wed Jun 27, 2018 9:35 pm
Forum: Personal Finance (Not Investing)
Topic: "Who's John Bogle?"
Replies: 17
Views: 2404

Re: "Who's John Bogle?"

I would think EJ wants people who don't know anything (other than the bare minimum needed to pass the relevant industry exams). It's much easier for a salesperson to sell a lousy product when the salesperson doesn't realize it's a lousy product. They'll be a lot more genuine than someone who knows h...
by venkman
Wed Jun 27, 2018 9:25 pm
Forum: Investing - Theory, News & General
Topic: feedback on portfolio created by Vanguard PAS
Replies: 16
Views: 1741

Re: feedback on portfolio created by Vanguard PAS

VTMFX is essentially just 48% VTSAX and 52% VWITX. I don't believe that's actually the case, per my read of the M* Analyst report. Can you provide a source or more info on why you think that is? It is essentially 48% vtclx and 52% vwitx Fair enough. The stock part of VTMFX is probably closer to VTC...
by venkman
Tue Jun 26, 2018 11:02 pm
Forum: Investing - Theory, News & General
Topic: feedback on portfolio created by Vanguard PAS
Replies: 16
Views: 1741

Re: feedback on portfolio created by Vanguard PAS

50% - Vanguard Tax Managed Balanced Fund - VTMFX (this would involve me selling about $50K of my current holding with a about $2K of cap gains) 4% - Vanguard Tax-Managed Capital Appreciation Fund - VTCLX (keeps all my current holdings - no material unrealized gains here) 27% - Total International S...
by venkman
Tue Jun 26, 2018 10:15 pm
Forum: Investing - Theory, News & General
Topic: Expected reward for risk of Corp bond over CD?
Replies: 8
Views: 646

Re: Expected reward for risk of Corp bond over CD?

29 basis points might not be an entirely unreasonable spread for a 1-year maturity. Credit risk goes up significantly with time. Looking at Vanguard's CD & Bond offerings: A 1-year brokered CD is yielding 2.4%, while a 1-year upper-medium grade corporate bond is yielding 2.89%. A 10-year CD is yield...
by venkman
Sun Jun 24, 2018 10:06 pm
Forum: Investing - Help with Personal Investments
Topic: Caps Gains Tax Strategy
Replies: 12
Views: 1120

Re: Caps Gains Tax Strategy

For example, if I bought options and lost 80k, I would really only lose 40K after taxes. Is there a good way to take 40k of risk this year in exchange for a gain in 2019? How would making a speculative bet be different if I didn’t have cap gains? But what if the worst-case scenario happened and you...
by venkman
Sun Jun 24, 2018 9:57 pm
Forum: Investing - Theory, News & General
Topic: VWALX up over VWLUX - why?
Replies: 3
Views: 526

Re: VWALX up over VWLUX - why?

john_nh wrote:
Sun Jun 24, 2018 4:54 pm
Is this more a factor of investors "chasing yield" and driving up VWALX?
I think that's it. The same thing happened with high yield corporate bonds. People chasing yield drove down the credit spread.
by venkman
Sun Jun 24, 2018 9:37 pm
Forum: Investing - Theory, News & General
Topic: S&P P/E Ratio
Replies: 50
Views: 3313

Re: S&P P/E Ratio

I have read that the S&P P/E ratio is at about 25 right now and the historic average is about 16. What am I missing?? Is it reasonable to sell knowing that the market will likely return to a P/E of 16??? Is the general belief that earnings will rise enough to return this ratio to a historic average...
by venkman
Thu Jun 21, 2018 11:24 pm
Forum: Investing - Theory, News & General
Topic: Real Estate vs. Equity - Market Cap Weighted
Replies: 10
Views: 895

Re: Real Estate vs. Equity - Market Cap Weighted

Are these figures true? And assuming they are, from a risk-adjusted return, assuming it were feasible and one is willing to do the work, would an optimal portfolio own 3x the physical real estate as the amount invested in stocks? If one is willing to do the work, one can forgo a passive investment ...
by venkman
Thu Jun 21, 2018 9:50 pm
Forum: Investing - Theory, News & General
Topic: Understanding AA in Vanguard Target Date Funds
Replies: 6
Views: 578

Re: Understanding AA in Vanguard Target Date Funds

It sounds like you've already figured out their rule of thumb. 90/10 until 25-ish years before retirement, then a straight slope down to 60/40 over the next 20 years. I don't think there's any way to reduce that formula to something simpler.