Search found 582 matches

by venkman
Sun Jun 24, 2018 10:06 pm
Forum: Investing - Help with Personal Investments
Topic: Caps Gains Tax Strategy
Replies: 6
Views: 505

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: 319

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: 23
Views: 932

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: 723

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: 495

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.
by venkman
Wed Jun 20, 2018 10:28 pm
Forum: Investing - Help with Personal Investments
Topic: What should be my stock/bond allocation?
Replies: 21
Views: 1495

Re: What should be my stock/bond allocation?

My husband and I just sold our business (we are 52 years old and still have 3 kids to put through college). We would need to live on 5-6% from our investments a year for the next 6 years then hopefully our cost of living will go down. Given the current market, would a 40/60 allocation be appropriat...
by venkman
Wed Jun 20, 2018 9:56 pm
Forum: Investing - Help with Personal Investments
Topic: Target Date Fund in Taxable / Large Unrealized Gain Question
Replies: 13
Views: 826

Re: Target Date Fund in Taxable / Large Unrealized Gain Question

2. Sell bits and pieces (mainly on down days) to limit tax bill over the course of a couple of years If you do this, make sure you put in an order to exchange your current fund for VTSAX, so both transactions go through on the same day. Selling on down days is generally a bad idea. Exchanging one t...
by venkman
Wed Jun 20, 2018 9:10 pm
Forum: Investing - Theory, News & General
Topic: To bond barbell or not to barbell, that is the question
Replies: 4
Views: 981

Re: To bond barbell or not to barbell, that is the question

This is what I fail to understand. If long term bonds yield less, then why would this increase your selling price? I guess I need to do some more reading on bond yield/price relationships... Bond prices and yields move inversely. When price goes up, yield goes down, and vice-versa. A $1,000 par val...
by venkman
Wed Jun 20, 2018 8:48 pm
Forum: Personal Finance (Not Investing)
Topic: Vanguard posts wrong amount purchased
Replies: 6
Views: 852

Re: Vanguard posts wrong amount purchased

I have the same issue. Mine is off by about $20. But I don't know how "official" the P&W number is. Vanguard always has my account balances right, which is the main thing I care about. As long as you have records of your transactions, I wouldn't worry if just that P&W number is wrong.
by venkman
Tue Jun 19, 2018 10:35 pm
Forum: Investing - Help with Personal Investments
Topic: Financial Engines Financial Advisor Question
Replies: 7
Views: 759

Re: Financial Engines Financial Advisor Question

If you had posted your retirement funds and ER's here, you could've gotten the same advice. Also for free, except that it continues to be free after 3 months. :happy
by venkman
Mon Jun 18, 2018 10:19 pm
Forum: Investing - Theory, News & General
Topic: Mutual Fund Dividends
Replies: 12
Views: 1031

Re: Mutual Fund Dividends

If not, why would they not have a measurable cash drag? If you say dividends are 2% annual, 0.5% quarterly and returns over the past five years were well over 10%, you'd be losing over say 0.05% a year in this continuously rising market. I don't see that happening in the Morningstar S&P 500 Total R...
by venkman
Mon Jun 18, 2018 2:05 am
Forum: Investing - Help with Personal Investments
Topic: Tax implications of holding Wellesley Emergency in taxable
Replies: 8
Views: 844

Re: Tax implications of holding Wellesley Emergency in taxable

Hey guys I have currently have my Emergency fund in the Wellesley fund at 33k (30k + 3k if it drops 10 percent). What would be the tax complications if I don't add anymore more to it and let it sit for like 10 -20 years and don't sell it. I also currently contribute 30k a year (2500k a month) to vt...
by venkman
Mon Jun 18, 2018 1:17 am
Forum: Investing - Theory, News & General
Topic: Indiv. REITs in taxable because of new tax law? Aargh!
Replies: 13
Views: 1648

Re: Indiv. REITs in taxable because of new tax law? Aargh!

+1 on running the numbers.

Does this change suddenly make REIT's tax-efficient, or just less tax-inefficient than they used to be?
by venkman
Mon Jun 18, 2018 12:57 am
Forum: Investing - Theory, News & General
Topic: Very confused with the current market
Replies: 93
Views: 8328

Re: Very confused with the current market

capcase wrote:
Sun Jun 17, 2018 9:57 pm
I remember Warren buffet once said: buy the dips and value investing.
You could just put all your investable money into Berkshire-Hathaway, and let Warren Buffet worry about buying the dips for you. He's sitting on a HUGE pile of cash right now, so he should be ready when the dip happens...
by venkman
Mon Jun 18, 2018 12:44 am
Forum: Personal Finance (Not Investing)
Topic: Using donor advised fund to diversify stock with large capital gains
Replies: 38
Views: 2243

Re: Using donor advised fund to diversify stock with large capital gains

It's a good plan, but know that deductions for charitable contributions of appreciated stock are limited to a maximum of 30% of your AGI in a given tax year. Any amount above that can be carried over for 5 years. I just ran into this issue while making a DAF plan for a relative. Not a deal breaker ...
by venkman
Sat Jun 16, 2018 9:14 pm
Forum: Personal Finance (Not Investing)
Topic: Using donor advised fund to diversify stock with large capital gains
Replies: 38
Views: 2243

Re: Using donor advised fund to diversify stock with large capital gains

I'm curious what people think about this strategy. Given the risk of a single stock, it seems preferable to holding this individiual stock for years and donating small chunks. And if we do find a worthy cause to donate all of it at once, we can still do that with the donor advised fund. Are there a...
by venkman
Fri Jun 15, 2018 10:52 pm
Forum: Investing - Theory, News & General
Topic: Factor-based strategy is better (winer), OK. then who are the losers?
Replies: 55
Views: 2490

Re: Factor-based strategy is better (winer), OK. then who are the losers?

The individual stock picker does frequently choose been an individual large company and an individual small company. That's not what we're talking about here. We're comparing many thousands of small companies vs. a relatively few number of large companies. But those individual active stock pickers ...
by venkman
Fri Jun 15, 2018 10:17 pm
Forum: Investing - Theory, News & General
Topic: Am I "market timing"?
Replies: 37
Views: 1869

Re: Am I "market timing"?

If I pulled the trigger today, instead, the buy order would execute next Tuesday morning, right when trading opens. It probably doesn't matter for the sake of this conversation, but I use SWTSX (Schwab Total Stock Market Index) as a stand-in for VTSAX within my recently opened Solo 401k at eTrade. ...
by venkman
Fri Jun 15, 2018 9:32 pm
Forum: Personal Finance (Not Investing)
Topic: Savings rate to achieve retirement goals?
Replies: 10
Views: 1104

Re: Savings rate to achieve retirement goals?

One statistic that I read recently (paraphrased) -- For individuals retiring with a nest egg of at least $500K -- after 19 years the average person still had 88% of their original nest egg value. That is a statistic I would take with a big grain of salt. Some outliers (e.g. people whose pension/SS ...
by venkman
Thu Jun 14, 2018 9:54 pm
Forum: Investing - Theory, News & General
Topic: Rate hikes vs - Muni, Corp, Total Bond funds
Replies: 14
Views: 1784

Re: Rate hikes vs - Muni, Corp, Total Bond funds

With the recent rate hike, and more anticipated, how does that affect the Vanguard bond funds - such as the Intermediate Muni, LT Investment Grade, or Total US Bond I can see how some of these types might be directly impacted by rising rates - but what about the Vanguard Intermediate Muni fund I th...
by venkman
Thu Jun 14, 2018 9:39 pm
Forum: Investing - Theory, News & General
Topic: Factor-based strategy is better (winer), OK. then who are the losers?
Replies: 55
Views: 2490

Re: Factor-based strategy is better (winer), OK. then who are the losers?

Lastly, and most importantly, what makes you think people have not? The small and value premiums have fallen. They may not exist anymore. I think investors have figured out this aberration and have now fully exploited it. That is what I am thinking. After more investors find out this, more will loa...
by venkman
Tue Jun 12, 2018 10:25 pm
Forum: Investing - Theory, News & General
Topic: Why is long bonds yielding less than short bonds?
Replies: 7
Views: 1090

Re: Why is long bonds yielding less than short bonds?

EDV invests in long-term zero-coupon bonds. The bonds themselves pay out no regular interest, but the fund pays out some dividends as it gets money from bonds that mature. In terms of income, I don't know how close a match you can expect to get, compared to regular long-term Treasuries. I've always ...
by venkman
Tue Jun 12, 2018 1:23 am
Forum: Investing - Theory, News & General
Topic: WSJ-- Next Stop for Mutual-Fund Fees: Zero
Replies: 40
Views: 4207

Re: WSJ-- Next Stop for Mutual-Fund Fees: Zero

I don't disagree with the sentiment that paying nothing in fees is better than paying something in fees; but the choice of which day to make a transaction will likely affect your return far more than 0.035%. Transactions?? I’m buy and hold. I don’t need no stinken’ transactions. Yeah, but presumabl...
by venkman
Tue Jun 12, 2018 1:21 am
Forum: Investing - Help with Personal Investments
Topic: Dividend Buffer
Replies: 24
Views: 2252

Re: Dividend Buffer

Usually, whenever the yield started going down, it was because the price had been going up; so you were getting a smaller slice of a bigger pie, and your income didn't drop. I'm curious about this backtest -- specifically in subsequent years, were you looking at the dollars distributed or using the...
by venkman
Tue Jun 12, 2018 12:47 am
Forum: Investing - Theory, News & General
Topic: WSJ-- Next Stop for Mutual-Fund Fees: Zero
Replies: 40
Views: 4207

Re: WSJ-- Next Stop for Mutual-Fund Fees: Zero

I'm going to disagree with this. Somebody with a million in a fund with .035% ER would save $350 per year in expenses, which would remain in the account as additional earnings, compounding over the decades. A person with 3 million would save over $1000 per year. That's more than psychological. That...
by venkman
Mon Jun 11, 2018 12:10 am
Forum: Investing - Help with Personal Investments
Topic: VBTLX distribution yield for May
Replies: 8
Views: 1517

Re: VBTLX distribution yield for May

I'm not sure your really mean "how much you paid." The yield is based on the current NAV (over the month). There is an idea people sometimes have that the yield is based on their own individual purchase price, but that is not one of the normally used "official" numbers. Doing that is a good way to ...
by venkman
Sun Jun 10, 2018 11:25 pm
Forum: Investing - Help with Personal Investments
Topic: Dividend Buffer
Replies: 24
Views: 2252

Re: Dividend Buffer

Interesting responses. I'll set forth a guideline. Let's say for instance that the s&p 500 dividend is the one you're using exclusively for withdrawals. What buffer would you be comfortable with having to protect from eating cat food if s&p 500 dividends were cut? I did a sort of back test for this...
by venkman
Sat Jun 09, 2018 10:59 pm
Forum: Investing - Help with Personal Investments
Topic: 35 and Need Help With Building Wealth
Replies: 55
Views: 6610

Re: 35 and Need Help With Building Wealth

Any advice you can give me would be great. If I need to increase my income I have ways of doing so, but it takes a month or two for it to kick in. I'm willing to take any steps I need to build my wealth faster. There's no magic formula. To build wealth, you need to save money. The only ways to incr...
by venkman
Sat Jun 09, 2018 10:03 pm
Forum: Personal Finance (Not Investing)
Topic: Calculation of APY (Annual Percentage Yield) for Savings
Replies: 10
Views: 671

Re: Calculation of APY (Annual Percentage Yield) for Savings

Correct calculation of APY: Assume a large dollar balance (say $100,000 as example) Why does the size of the balance matter? Shouldn't the APY depend only on the rate and the compounding period? e.g. For a monthly compounding period, the APY would be [(1 + (Rate/12))^12] -1. The balance is irreleva...
by venkman
Fri Jun 08, 2018 9:23 pm
Forum: Investing - Help with Personal Investments
Topic: VBTLX distribution yield for May
Replies: 8
Views: 1517

Re: VBTLX distribution yield for May

thanks @venkman, that does make a little more sense. So you are saying the NAV will rise as the bonds mature in the fund even if the interest rates stay the same from this point. The distribution yield is the same for everyone but those that bought at a discount from say the price in Jan will get t...
by venkman
Thu Jun 07, 2018 3:08 am
Forum: Investing - Help with Personal Investments
Topic: Fixed Income investments too conservative?
Replies: 59
Views: 3727

Re: Fixed Income investments too conservative?

My husband simply thinks we're being 'too conservative' and feels we could be getting a higher return, so he recently asked our financial adviser what a fixed income portfolio that earns 3.5%/year would look like. Fellow BH's, my bias is to use fixed income for stability, and not chase yield/take o...
by venkman
Thu Jun 07, 2018 2:37 am
Forum: Investing - Help with Personal Investments
Topic: VBTLX distribution yield for May
Replies: 8
Views: 1517

Re: VBTLX distribution yield for May

Thanks, I was under the impression that the SEC yield was the payout. I read some material on SEC yield vs Distribution yield but it is quite confusing. I''m just concerned that I am not understanding the way bond funds work actually. From the various threads on this forum I assumed that the drop i...
by venkman
Thu Jun 07, 2018 1:31 am
Forum: Investing - Theory, News & General
Topic: Just added bonds to portfolio
Replies: 44
Views: 2947

Re: Just added bonds to portfolio

I would hate to have just done something that will significantly reduce the gains of our portfolio! :oops: Adding bonds will, over the long term, almost certainly reduce the gains of your portfolio. It will also reduce the volatility of your portfolio, which is why people hold bonds. Whether the re...
by venkman
Thu Jun 07, 2018 12:51 am
Forum: Personal Finance (Not Investing)
Topic: How to help 12 year old learn about business/investing
Replies: 14
Views: 1065

Re: How to help 12 year old learn about business/investing

I think the problem you may run into is that investing, if you do it right, is SUPPOSED to be boring. Anything that makes it seem fun or exciting (e.g. treating it like a game, where you can 'beat' the other players if you have enough skill) could teach exactly the wrong lesson. It's like the differ...
by venkman
Tue Jun 05, 2018 9:25 pm
Forum: Personal Finance (Not Investing)
Topic: CD interest
Replies: 18
Views: 2038

Re: CD interest

Frequency of compounding only matters if you're comparing two CD's that have the same annual RATE. A lot of CD's are advertised based on annual YIELD, which includes the compounded interest in its calculation. Two CD's with the same annual yield should give you an equivalent return, regardless of ho...
by venkman
Mon Jun 04, 2018 10:44 pm
Forum: Investing - Help with Personal Investments
Topic: Portfolio review & questions
Replies: 20
Views: 1752

Re: Portfolio review & questions

1. The VWINX in taxable was my first foray into investing in a taxable account and was before I discovered bogleheads. The money was excess savings (above my emergency fund) that had been sitting in a savings account. My thought at the time was to put it in a conservative allocation fund, to preser...
by venkman
Fri Jun 01, 2018 9:55 pm
Forum: Investing - Help with Personal Investments
Topic: Seeking input on investment decision
Replies: 21
Views: 1741

Re: Seeking input on investment decision

My goal for this money is relatively higher current income while minimizing capital risks from stock market corrections and higher interest rates, but maintaining some growth potential to at least stay ahead of inflation. You can have higher current income OR you can minimize interest rate risk, bu...
by venkman
Tue May 29, 2018 10:42 pm
Forum: Investing - Help with Personal Investments
Topic: Creative Planning vs Vanguard PAS
Replies: 90
Views: 5374

Re: Creative Planning vs Robo-advisor

To answer your question, nothing. If I did it myself I would probably replicate something like what Creative Planning is doing which involves 10+/- ETFs which vary depending on type of account. They have also included 4 MLPs and a real estate ETF for added diversification. Their asset allocation se...
by venkman
Tue May 29, 2018 9:51 pm
Forum: Investing - Theory, News & General
Topic: Equal weight for index fund?
Replies: 51
Views: 2938

Re: Equal weight for index fund?

If the median stock underperforms the average stock (i.e. the average is increased by a small number of outlier stocks with very large gains), then it all depends on the market cap of those big outperformers. If Apple gains 40% in a year, that's bad for an equal-weight fund. If Goodyear (market cap ...
by venkman
Sun May 27, 2018 11:42 pm
Forum: Personal Finance (Not Investing)
Topic: Muni mm keeps dropping in yield, thinking of switching
Replies: 5
Views: 1601

Re: Muni mm keeps dropping in yield, thinking of switching

How about the short term muni and limited term muni? Do they cycle in yield like muni mm for no obvious reason? Do you think they are a decent choice for short to interm. cash needs? The price/yield of those funds will fluctuate with short-term interest rate changes, but I would feel fine holding s...
by venkman
Sat May 26, 2018 11:03 pm
Forum: Personal Finance (Not Investing)
Topic: Muni mm keeps dropping in yield, thinking of switching
Replies: 5
Views: 1601

Re: Muni mm keeps dropping in yield, thinking of switching

The problem with bonds is that stability of income is inversely correlated with stability of principal. (i.e. A long-term bond will guarantee a certain level of income for decades, but its market value will fluctuate greatly with changes in interest rates. A short-term bond's market value will be re...
by venkman
Fri May 25, 2018 11:24 pm
Forum: Investing - Theory, News & General
Topic: If the US market cap was 5% instead of 52%, would the US vs International conversation change?
Replies: 40
Views: 2968

Re: If the US market cap was 5% instead of 52%, would the US vs International conversation change?

So if, hypothetically, the US market cap was 5% and the rest of the world 95%...would the anti-international people have a different US/INTL allocation, or would it be the same? I'm not anti-international, but this is the argument I would make: In 2017, about 43% of sales for S&P 500 companies came...
by venkman
Fri May 25, 2018 11:08 pm
Forum: Investing - Help with Personal Investments
Topic: Investing question on international funds
Replies: 2
Views: 394

Re: Investing question on international funds

VMVFX is invested about 50% in US companies, so it should not be considered a replacement for an international fund that is 100% foreign stocks. (Though if you wanted 20% of your portfolio in international stocks, you could hold a 40% position in VMFVX.) It only has about 400 stocks, so it's far les...
by venkman
Fri May 25, 2018 10:14 pm
Forum: Investing - Theory, News & General
Topic: If the US market cap was 5% instead of 52%, would the US vs International conversation change?
Replies: 40
Views: 2968

Re: If the US market cap was 5% instead of 52%, would the US vs International conversation change?

So if, hypothetically, the US market cap was 5% and the rest of the world 95%...would the anti-international people have a different US/INTL allocation, or would it be the same? I'm not anti-international, but this is the argument I would make: In 2017, about 43% of sales for S&P 500 companies came...
by venkman
Wed May 23, 2018 10:50 pm
Forum: Personal Finance (Not Investing)
Topic: Need help with debt strategy
Replies: 47
Views: 2647

Re: Need help with debt strategy

No, OP is a young, single student who is graduating from college with a very reasonable amount of debt and a good salary, not someone with long-term problems due to a complete absence of money management skills and massive amounts of credit card debt who needs to follow bad advice.... The OP is 29 ...
by venkman
Mon May 21, 2018 9:21 pm
Forum: Investing - Theory, News & General
Topic: Typical interest rate earned by target date funds in retirement?
Replies: 28
Views: 2045

Re: Typical interest rate earned by target date funds in retirement?

Thank you Moto. Since 4% is frequently cited, what investment is that based on? I'm trying to determine my FI date and I would like to have a real solid idea of these numbers. Currently, I'm using a 4% draw down and 3% gain (during that period). That gets me through 44 years without going negative....
by venkman
Sun May 20, 2018 9:52 pm
Forum: Investing - Help with Personal Investments
Topic: Investments that are unique *and* sensible?
Replies: 19
Views: 2331

Re: Investments that are unique *and* sensible?

I quibble with you saying that expected return on SPIA is negative. There is no theoretical basis that says the expected return will be negative. Moreover quotes for today show a very slightly positive expected return. (payment * life expectancy is slightly greater than cost). Is that nominal or re...
by venkman
Sun May 20, 2018 8:57 pm
Forum: Investing - Help with Personal Investments
Topic: Please help me rationalise this 401k investment choice
Replies: 23
Views: 1365

Re: Please help me rationalise this 401k investment choice

Does my colleague have a point? Should one be looking only at ER adjusted performance (current and past)? Am I not following the "simple 3-fund philosophy" correctly ? How can I convince him, and more importantly myself. VINIX is a large-cap blend fund. The only fair comparison would be to another ...
by venkman
Sun May 20, 2018 8:42 pm
Forum: Investing - Theory, News & General
Topic: Wow! Just discovered "Portfolio Visualizer".
Replies: 6
Views: 2507

Re: Wow! Just discovered "Portfolio Visualizer".

Does this mean that the 3FP isn't efficient? That the proxy for total international (Global ex-US Market) is not correct? That the available history of returns (from 1987) is inadequate, or that the efficient frontier is not meaningful? Other? Efficient frontier backtesting is kinda like asset clas...
by venkman
Sat May 19, 2018 9:55 pm
Forum: Investing - Help with Personal Investments
Topic: Investments that are unique *and* sensible?
Replies: 19
Views: 2331

Re: Investments that are unique *and* sensible?

I would quibble slightly with the idea that SPIA's are "investments," since your expected return is negative.

That being said, there's nothing wrong with an SPIA; it's just an insurance product rather than an investment.