Search found 195 matches

by joeschmo
Wed Nov 23, 2022 5:24 pm
Forum: Personal Finance (Not Investing)
Topic: Best Way to Plan Travels for Uncertainty?
Replies: 11
Views: 1136

Re: Best Way to Plan Travels for Uncertainty?

Thanks. What about lodging - are there time share options in major cities that might be cheap enough, or do I need to just keep booking changeable week-long airbnbs? I guess flexibility is always hard until you literally own a pied a terre….
by joeschmo
Wed Nov 23, 2022 4:40 pm
Forum: Personal Finance (Not Investing)
Topic: Best Way to Plan Travels for Uncertainty?
Replies: 11
Views: 1136

Re: Best Way to Plan Travels for Uncertainty?

Thanks for the idea! I tried a local agency found on Google but they were only able to book rooms from pre-approved hotel inventory. Do you know how to find a business travel agent that won't privilege their "own" inventory and will even log into your Airbnb account for you?
by joeschmo
Tue Nov 22, 2022 4:51 pm
Forum: Personal Finance (Not Investing)
Topic: Best Way to Plan Travels for Uncertainty?
Replies: 11
Views: 1136

Best Way to Plan Travels for Uncertainty?

Hello, For work I travel between the US and London/Paris/Amsterdam a lot to meet clients (self employed). I recently booked 2 weeks of lodging and a nice flight (business class for a change...), only to learn that it probably wasn't worth my while to meet this client at all. The flights weren't changeable so I lost 100% of the airfare and lodging fees. I'll travel there a few weeks later now and have to book a new flight to do that. :x Re lodging I am tempted just to rent a small flat, but I don't think I am in these cities long enough per year. So: 1. Do people have suggestions for how to make travels more flexible? Air travel insurance vs changeable airfares? Cancellable Airbnbs (rare and often the selection isn't great)? Favorite airline...
by joeschmo
Sun Nov 13, 2022 4:17 pm
Forum: Personal Investments
Topic: Creative ways to execute high-tax investment changes in taxable accounts?
Replies: 15
Views: 1510

Re: Creative ways to execute high-tax investment changes in taxable accounts?

Thanks to everyone for the replies! There are two issues: 1. I recently changed my IPS to reflect lower need to take risk (= my decision that I only needed to be at 50% stock), but I didn't have the courage to incur a huge tax bill just to fulfill that. 2. Stock values grow faster than the income they produce, so I think I will always end up overweighted to stocks. Thus any delay of solving this problem will just let it get worse, I think? @grabiner: - My asset allocation calls for 50% stocks, in a US/ex-US mix that matches the current world balance. The ex-US portion hasn't done well, but I don't believe I'm able to decide the value of ex-US stocks better than the market, so I aim to keep that balance constant. (I would have bought Vanguar...
by joeschmo
Sat Nov 12, 2022 12:21 pm
Forum: Personal Finance (Not Investing)
Topic: Umbrella policy for $10m-$20m?
Replies: 44
Views: 7490

Re: Umbrella policy for $10m-$20m?

Thanks orlandoguy. I don't know other HNW folks, and googling this stuff didn't yield much. I appreciate your tips.

I read many past forum threads re amount of coverage, with quite differing advice (some saying $5m is fine regardless, others say do your whole net worth). Does anyone know of books etc. that would cover this? My estate attorney hasn't been helpful.
by joeschmo
Sat Nov 12, 2022 11:23 am
Forum: Personal Investments
Topic: Creative ways to execute high-tax investment changes in taxable accounts?
Replies: 15
Views: 1510

Re: Creative ways to execute high-tax investment changes in taxable accounts?

Thanks for all these ideas!

Unfortunately I'm all out of losses, except for a bit on the international side. Either way, it's so small that it won't help nearly enough.

(Updated my post to say that I'm redirecting dividends to underweighted asset classes.)
by joeschmo
Sat Nov 12, 2022 11:20 am
Forum: Personal Finance (Not Investing)
Topic: Umbrella policy for $10m-$20m?
Replies: 44
Views: 7490

Re: Umbrella policy for $10m-$20m?

Thanks so much for these tips and the forum thread from 2021, which I missed! I'll try Chubb and PURE.
by joeschmo
Sat Nov 12, 2022 11:01 am
Forum: Personal Investments
Topic: Creative ways to execute high-tax investment changes in taxable accounts?
Replies: 15
Views: 1510

Re: Creative ways to execute high-tax investment changes in taxable accounts?

Tax-deferred accts are unfortunately too small a proportion to be helpful.
by joeschmo
Sat Nov 12, 2022 10:55 am
Forum: Personal Investments
Topic: Creative ways to execute high-tax investment changes in taxable accounts?
Replies: 15
Views: 1510

Creative ways to execute high-tax investment changes in taxable accounts?

Hello, My current asset allocation is 60% stocks, and my IPS says I should be at 50%. The trouble is, I've held my US stock funds since 2012 and there'll be an enormous taxable gain. The other trouble is, clearly I should have done in this in 2021. :x But we're not market timers, right? Anyway, I'm fortunate that 60 vs 50 is not a meaningful difference to me, but at some point I'll have to pull the trigger (70…80…). Does anyone have strategies for doing this? * do a tiny bit every year for 5 years to minimize tax bill - annoying * give away a lot - am already giving away a lot * skip it since 60 vs 50 isn't a huge difference - but if I skip it for now, then when rebalancing the rest of my portfolio, I guess I adjust all my other asset alloc...
by joeschmo
Sat Nov 12, 2022 10:46 am
Forum: Personal Finance (Not Investing)
Topic: Umbrella policy for $10m-$20m?
Replies: 44
Views: 7490

Umbrella policy for $10m-$20m?

Hi, California HNWI here. What insurance firms are people using for $10m-$20m of umbrella insurance? State Farm's prices double when you get past $5m and lots of firms don't even go past that.

Thank you!
by joeschmo
Fri Nov 04, 2022 10:28 pm
Forum: Personal Investments
Topic: CDARS - Can anyone share experience?
Replies: 11
Views: 2386

Re: CDARS - Can anyone share experience?

Hi, I’m bumping this thread to ask: why would someone do Intra-Fi (aka CDARS) when they could buy treasury bills on Treasury Direct? Is FDIC somehow better than the full faith and credit of the US gov?
by joeschmo
Mon Nov 15, 2021 10:24 pm
Forum: Personal Consumer Issues
Topic: Vanguard Security Key
Replies: 55
Views: 8252

Re: Vanguard Security Key

It’s been years and Vanguard confirmed again to me that they don’t have any way to auth just with a Yubikey. Is there anyone who has a higher-level contact at Vanguard and could try to push this further? It’s like having a great lock on your front door and leaving the back door just locked with a little door handle doohickey. Not what I want for my entire life savings.
by joeschmo
Sun Oct 03, 2021 5:30 pm
Forum: Investing - Theory, News & General
Topic: Harvard and other schools divest from fossil fuels - how can individuals follow suit?
Replies: 37
Views: 2718

Re: Harvard and other schools divest from fossil fuels - how can individuals follow suit?

BGeste wrote: Sun Oct 03, 2021 5:21 pm Harvard is choosing to potentially underperform by excluding a significant segment. Oil is likely to revert to the mean over the next ten years. It was the best performer in September. Introducing politics into investment decisions is a losers game.
Given that the governments of all major countries are aggressively pushing away from fossil fuels, it is not irrational to exclude fossil fuels. However, I am not looking for feedback on that goal, but rather on how to achieve that goal while remaining as passive and low-cost as possible.
by joeschmo
Sun Oct 03, 2021 4:00 pm
Forum: Investing - Theory, News & General
Topic: Harvard and other schools divest from fossil fuels - how can individuals follow suit?
Replies: 37
Views: 2718

Re: Harvard and other schools divest from fossil fuels - how can individuals follow suit?

Thanks, I hadn't seen that site. It would be much more useful if it also included expense ratios and showed how closely these track a relevant index. Come to think of it, what is the relevant index?
by joeschmo
Sun Oct 03, 2021 3:07 pm
Forum: Investing - Theory, News & General
Topic: Harvard and other schools divest from fossil fuels - how can individuals follow suit?
Replies: 37
Views: 2718

Harvard and other schools divest from fossil fuels - how can individuals follow suit?

Harvard and other schools are finally divesting from fossil fuels (NYT).

How can passive individual investors follow suit without sacrificing on price or passivity? Last I checked, all the SRI options carried a high price premium.
by joeschmo
Mon Nov 09, 2020 9:36 pm
Forum: Investing - Theory, News & General
Topic: Fidelity - Reset VIP access code by giving codes to agent?
Replies: 1
Views: 412

Fidelity - Reset VIP access code by giving codes to agent?

I bought a new computer and my VIP Access started failing and told me to call a Fidelity support number. They sent me an access code and asked me to read it to them, which seemed suspicious except that (1) I was the one who called them and (2) the text said "please read this to the representative," in contrast to the usual usual 2FA texts. They then asked me to read them the Symantec VIP Access credential ID. After that, I could successfully log into my account. Questions:

1. Wouldn't this representative now have access to my account?
2. Couldn't an attacker gain access to my account by just calling this number as I did?
by joeschmo
Wed Aug 26, 2020 9:23 am
Forum: Personal Investments
Topic: Assets going from 600K->15M, should I change my asset allocation?
Replies: 176
Views: 22182

Re: Assets going from 600K->15M, should I change my asset allocation?

Starfox wrote: Wed Aug 26, 2020 9:17 am You are quite wrong. We are retired, not drawing SS, have more money than this OP, and it is all in taxable accounts, spread between SP500 Index fund and muni funds, 75/25 stock/bond allocation and we pay $59k/year in federal taxes, filing MFJ. No carry-over losses, and we file standard deduction. No state income tax for us.
I’m in your position too. I have a hard time understanding the added risk of munis. What % of your bonds are in munis, and which muni funds do you use?
by joeschmo
Sun Aug 16, 2020 5:11 am
Forum: Personal Investments
Topic: Assets going from 600K->15M, should I change my asset allocation?
Replies: 176
Views: 22182

Re: Assets going from 600K->15M, should I change my asset allocation?

I'm in the same situation to you. At first I read Random Walk Down Wall St and got on the index bandwagon, but I was too afraid to move large quantities of money around myself. I hired an AUM advisor (who talked the index talk) for part of the money and put the rest at Vanguard in a 3-fund portfolio. After paying 0.5%/year for ~10 years and tolerating their complexity and unclear reporting, I finally found the courage to go it on my own. I did consult with Rick Ferri, which was very helpful in gaining confidence. I made my own IPS based on the CFA Institute and Vanguard guidelines, and I follow it to the letter. I found a CPA that I love, and I'm happy paying her a lot since I think taxes are one of the few easily controllable aspects of in...
by joeschmo
Wed Mar 18, 2020 3:30 pm
Forum: Investing - Theory, News & General
Topic: FDIC Coverage Limits - Trying to understand max coverage in a single savings account
Replies: 8
Views: 537

Re: FDIC Coverage Limits - Trying to understand max coverage in a single savings account

You can use this tool from FDIC to have the authoritative answer to these questions:

https://edie.fdic.gov/

Hope this helps!
by joeschmo
Wed Mar 18, 2020 6:13 am
Forum: Personal Investments
Topic: Cash Management Strategy
Replies: 37
Views: 4252

Re: Cash Management Strategy

FDIC insurance is $250k per depositor, so you can add those people as POD. I have separate banks with $1mm at each place. $250k under my name. $750k under my name with 3 POD names. So it's fully insured at each place. From there, I just have to manage 4-5 bank accounts, which is annoying. I can at least track balances via Mint. Rates were around 1.6-2% before coronavirus. Fully liquid and FDIC insured, and no need to rely on people with fancy titles! I don't believe POD works the way you think it does here, unless the account owner passes. It's based on the account owner, not the POD (or beneficiary on IRAs/401/403). You need 20 banks. Edit: if Joint w/spouse, 10 banks, as you get $500K FDIC per owner. Check out https://edie.fdic.gov/ to c...
by joeschmo
Wed Mar 18, 2020 6:04 am
Forum: Investing - Theory, News & General
Topic: Rebalancing -- IPS Clarification Needed
Replies: 37
Views: 2708

Re: Rebalancing -- IPS Clarification Needed

The Vanguard study linked above shows that rebalancing provides only small benefits in terms of increased returns. The real goal of rebalancing is to maintain allocation within your risk tolerance. If each daily market gyration changes your risk tolerance that much then you should rebalance, but there may be a tax and time cost to doing so. As the Vanguard study shows, you won't miss out hugely on returns if you just rebalance quarterly or annually. If you never rebalance, then of course your returns over the long run should be higher due to higher stock allocation, but you will be gradually taking on more risk. If you don't mind the gradually increasing risk then might as well save yourself time and just use Ellis calls "benign neglec...
by joeschmo
Wed Mar 18, 2020 5:57 am
Forum: Personal Investments
Topic: Cash Management Strategy
Replies: 37
Views: 4252

Re: Cash Management Strategy

FDIC insurance is $250k per depositor, so you can add those people as POD. I have separate banks with $1mm at each place. $250k under my name. $750k under my name with 3 POD names. So it's fully insured at each place. From there, I just have to manage 4-5 bank accounts, which is annoying. I can at least track balances via Mint. Rates were around 1.6-2% before coronavirus. Fully liquid and FDIC insured, and no need to rely on people with fancy titles!
by joeschmo
Wed Mar 18, 2020 3:48 am
Forum: Personal Investments
Topic: Cash Management Strategy
Replies: 37
Views: 4252

Re: Cash Management Strategy

gjlynch17 wrote: Tue Mar 17, 2020 6:20 am
joeschmo wrote: Tue Mar 17, 2020 4:21 am Why would someone use Flourish instead of a "professional" solution like CDARS?

https://www.cdars.com/
What is the yield for a CDARS solution?
You can view yields here: https://www.cdars.com/home/find/find-cdars
by joeschmo
Tue Mar 17, 2020 4:21 am
Forum: Personal Investments
Topic: Cash Management Strategy
Replies: 37
Views: 4252

Re: Cash Management Strategy

Why would someone use Flourish instead of a "professional" solution like CDARS?

https://www.cdars.com/
by joeschmo
Mon Mar 16, 2020 2:10 am
Forum: Personal Investments
Topic: Cash Management Strategy
Replies: 37
Views: 4252

Re: Cash Management Strategy

I’m currently using several bank accounts with POD to up the FDIC insurance and viewing balances with Mint. It’s super annoying to keep up to date but at least I don’t have a single point of failure from an information security perspective. I looked into CDARS but rates were considerably lower than keeping my 4-5 banks. I’d love a better solution.
by joeschmo
Sat Mar 07, 2020 3:36 am
Forum: Personal Finance (Not Investing)
Topic: Choosing a university/college for my son a future Computer Science Major
Replies: 212
Views: 25481

Re: Choosing a university/college for my son a future Computer Science Major

I attended a school not on your list, majored in CS while taking things like philosophy and art, interned at FAANG after sophomore year, graduated, started my own company, and sold it for millions of dollars. That’s atypical, but I hope you’ll hear my thoughts anyway. At age 16-17 I loved CS but also thought of becoming a nutritionist or architect. If I had narrowly focused my college search on what I thought I wanted at age 16, I would never have learned the drawing skills that I used to design a successful product, the critical thinking skills (probably from philosophy) that I used to debate legal issues during our acquisition, or the performing arts skills that bring me joy. Without a crystal ball, we can’t know whether a kid at age 16 w...
by joeschmo
Tue Mar 03, 2020 8:02 am
Forum: Personal Investments
Topic: Study CFA just for personal investment and portfolio management knowledge
Replies: 55
Views: 6085

Re: Study CFA just for personal investment and portfolio management knowledge

Sometimes there are long Bogleheads threads debating how to handle xyz problem in investing, sometimes throwing around misinformation (including from myself - not saying I know better!), when the questions and doubts could be resolved with a single table from the CFA materials. I don't see why anyone - much less a CFA charterholder - would discourage a curious Boglehead from learning from a reputable source. There are lots of very intelligent, quantitatively focused Bogleheads out there who would find it enjoyable to go straight to CFA and plow through explanations written for a technical audience. That's not to say that popular books by great authors like Bogle, Ferri, etc. are not useful - just that there's no reason to discourage curious...
by joeschmo
Tue Mar 03, 2020 7:02 am
Forum: Investing - Theory, News & General
Topic: Difference between short-term TIPS funds?
Replies: 71
Views: 7888

Re: Difference between short-term TIPS funds?

In case it helps others, page 250 of CFA Institute's excellent 963-page guide, Managing Investment Portfolios, offers the following helpful info:

Image
by joeschmo
Tue Mar 03, 2020 6:58 am
Forum: Personal Investments
Topic: Study CFA just for personal investment and portfolio management knowledge
Replies: 55
Views: 6085

Re: Study CFA just for personal investment and portfolio management knowledge

Hi all, I found a fantastic 963-page guide to investment management for CFA - this seems to be the real deal, free PDF for download from here:

https://www.academia.edu/31148356/Manag ... A_textbook_

This site also has many interesting PDFs to download, including the riveting 860-page PDF on financial reporting:

https://examupdates.in/cfa-level-1-books-pdf/

Hope this helps all those wanting to be extra on top of their investments!
by joeschmo
Mon Mar 02, 2020 9:10 am
Forum: Personal Investments
Topic: Study CFA just for personal investment and portfolio management knowledge
Replies: 55
Views: 6085

Re: Study CFA just for personal investment and portfolio management knowledge

Basically I'd like to learn portfolio construction - i.e., learn how people engineer diversified portfolios to hold for the long term and accomplish given goals. I'd like to learn this not by reading books written for a popular audience, but by reading books written for people who will do this professionally. Is there a better way than CFA-related books?
by joeschmo
Sun Mar 01, 2020 2:06 am
Forum: Investing - Theory, News & General
Topic: Suppose you founded a company like Microsoft or Amazon & have accumulated tremendous wealth. How would you invest?
Replies: 52
Views: 4465

Re: Suppose you founded a company like Microsoft or Amazon & have accumulated tremendous wealth. How would you invest?

I thankfullyhave 3-4 orders of magnitude smaller problems than the multibillionaires but you can see my thinking here:

viewtopic.php?t=302098

The real answer is likely that, like an asset allocation for someone with “merely” $100k, it entirely depends on the person.
by joeschmo
Thu Feb 27, 2020 11:47 am
Forum: Investing - Theory, News & General
Topic: Difference between short-term TIPS funds?
Replies: 71
Views: 7888

Re: Difference between short-term TIPS funds?

All right, thanks. So given high tax bracket and 35% bond allocation and long time horizon, seems I should be fine splitting 50/50 short-term TIPS and interm-term munis. Long-term bonds would be better against deflation risk but the interest rate risk seems a bad tradeoff. And I'll use funds for all these to avoid having to manage a zillion individual bonds. Sound right? Otherwise I could split the bond allocation 33/34/33 short-term TIPS / interm-term munis / long-term nominal U.S. Treasurys? But I'm trying to stay simple... Why do you think you need all 3? No offense, but trying to create a barbell strategy isn't for bond beginners. I thought it would make sense to have a balance of maturities, issuers, and inflation vs deflation protect...
by joeschmo
Wed Feb 26, 2020 1:26 am
Forum: Personal Investments
Topic: Study CFA just for personal investment and portfolio management knowledge
Replies: 55
Views: 6085

Re: Study CFA just for personal investment and portfolio management knowledge

Would you too recommend BKM Investments book or is there another? I personally find that wisdom comes from experience and theory. Sometimes I am a bit disappointed with Bogleheads. I understand that simplification is necessary fir they lay audiences. However, I would never confuse simplification and over/simplification with the truth. Honestly, I am not sure how much you would gain by going down this path. It is hard and wide. But the is no substitute for a solid theoretical understanding if you are going to tackle a subject. I personally find the subject matter fascinating. I have never read the BKM book so I don’t have a opinion. Thanks! Is there a textbook (non lay book) you used that you’d recommend? You hit the nail on the head for me...
by joeschmo
Tue Feb 25, 2020 3:13 pm
Forum: Personal Investments
Topic: Study CFA just for personal investment and portfolio management knowledge
Replies: 55
Views: 6085

Re: Study CFA just for personal investment and portfolio management knowledge

Does the CFA not go beyond “indexing is better” to discuss portfolio construction? I imagine some of my questions about TIPS that I have asked here could be answered by knowing what CFAs study? Level 3 is about ethics (20%) and portfolio construction (80%). However this builds heavily on level 1&2. Not sure what exactly you mean by indexing is better. It helps you pull apart a index to figure out exactly how it works. What factors you are being exposed to, their expected risk and returns, and how they fit with other factors to build a portfolio. It does not go into great depth on TIPS. A fair amount on general bond stuff. Thanks, this is really helpful. (“Indexing is better” was a reference to someone else’s post above.) This kind of s...
by joeschmo
Tue Feb 25, 2020 10:05 am
Forum: Investing - Theory, News & General
Topic: Difference between short-term TIPS funds?
Replies: 71
Views: 7888

Re: Difference between short-term TIPS funds?

All right, thanks. So given high tax bracket and 35% bond allocation and long time horizon, seems I should be fine splitting 50/50 short-term TIPS and interm-term munis. Long-term bonds would be better against deflation risk but the interest rate risk seems a bad tradeoff. And I'll use funds for all these to avoid having to manage a zillion individual bonds. Sound right?

Otherwise I could split the bond allocation 33/34/33 short-term TIPS / interm-term munis / long-term nominal U.S. Treasurys?

But I'm trying to stay simple...
by joeschmo
Tue Feb 25, 2020 9:43 am
Forum: Personal Investments
Topic: Large taxable portfolio - how to maximize charitable giving and minimize loss over long time horizon?
Replies: 25
Views: 3068

Re: Large taxable portfolio - how to maximize charitable giving and minimize loss over long time horizon?

Thanks @marky2kk for your feedback and help! I am indeed targeting 55/45 (market balance) of U.S./ex-U.S. equities, so it sounds like I'm as set as I could be for that.

Re insurnace, it's through Chubb. I have:

$500k personal liability coverage
$120k renters insurance
----------------------------------------
Premium: $1090

and

$10m excess liability
--------------------------
Premium: $334

I haven't looked at this stuff in years and those numbers seem sort of off balance...seems like insurance in excess of $10m is about as good as nothing at all, no?
by joeschmo
Tue Feb 25, 2020 9:31 am
Forum: Investing - Theory, News & General
Topic: Difference between short-term TIPS funds?
Replies: 71
Views: 7888

Re: Difference between short-term TIPS funds?

Sorry yes, nominal Treasurys. I've heard that nominal Treasurys in particular are good against deflation and was anyone can point to any sources about how munis perform in deflationary times?
by joeschmo
Tue Feb 25, 2020 7:15 am
Forum: Personal Investments
Topic: Study CFA just for personal investment and portfolio management knowledge
Replies: 55
Views: 6085

Re: Study CFA just for personal investment and portfolio management knowledge

I too have been wanting to study CFA materials, in order to give my personal investor that overkill “institutional strength” approach, even if that just means writing an IPS that fills in every blank. Since my portfolio is large, I feel it would be the responsible thing to do.

Does the CFA not go beyond “indexing is better” to discuss portfolio construction? I imagine some of my questions about TIPS that I have asked here could be answered by knowing what CFAs study?

I have already read the standard popular-audience Boglehead book recommendations. Can recent CFAs recommend textbooks on investment management?
by joeschmo
Tue Feb 25, 2020 1:41 am
Forum: Investing - Theory, News & General
Topic: Difference between short-term TIPS funds?
Replies: 71
Views: 7888

Re: Difference between short-term TIPS funds?

Thanks all - this is really getting clearer! In this case there is just one remaining question for my IPS: Swensen considers nominal Treasurys a separate core asset class from TIPS and recommends equal allocation to both in his standard portfolio (which, of course, he spends pages telling folks to adapt to their needs). Why would someone want Treasurys over TIPS if their goal is inflation protection? The point of each of Swensen’s asset classes is to provide major diversification benefit. I have heard that Treasurys protect against deflation, but I don’t understand why they’d necessarily do that better than, say, munis.

Thanks again for helping me clarify this mud.
by joeschmo
Mon Feb 24, 2020 5:55 pm
Forum: Investing - Theory, News & General
Topic: Difference between short-term TIPS funds?
Replies: 71
Views: 7888

Re: Difference between short-term TIPS funds?

So is it fair to say that nominal Treasurys* are adjusted for expected inflation only, whereas real Treasurys (TIPS) are adjusted for both expected and unexpected inflation? Is there a source someone could point me to that says this, so I can refer to it in my IPS?

Thanks for all the conversation about this!

* Looks like that rather than Treasuries is the correct spelling.
by joeschmo
Mon Feb 24, 2020 2:23 pm
Forum: Personal Investments
Topic: thoughts on my AA and proposed portfolio after windfall
Replies: 5
Views: 925

Re: thoughts on my AA and proposed portfolio after windfall

Congrats! I have a similar size of investable assets but lower expenses and longer time horizon and for bonds am leaning toward 50/50 short-term TIPS and interm-term munis. I want to stay as conservative as possible on the bond side but it seems nice to diversify issuers and thus not use Treasurys in place of the munis.

Details on my situation and thinking are here: viewtopic.php?t=302098

Would love to hear your thoughts or reactions since I still haven’t pulled the trigger on the TIPS portion of my allocation.

Joe
by joeschmo
Sun Feb 23, 2020 1:58 pm
Forum: Investing - Theory, News & General
Topic: Difference between short-term TIPS funds?
Replies: 71
Views: 7888

Re: Difference between short-term TIPS funds?

Thanks all! Do treasuries protect against (≤ expected) inflation in a way that munis do not? That would indicate that I should own some mix of munis, nominal treasuries, and real treasuries - but I'm not sure how to figure out that mix. Right now I imagined 50% short-term TIPS and 50% interm-term munis (for the bond portion of the portfolio).

Also, does Vanguard's research conclude that short-term TIPS help combat all inflation? https://personal.vanguard.com/pdf/ISGCTIPS.pdf
by joeschmo
Sat Feb 22, 2020 12:43 pm
Forum: Investing - Theory, News & General
Topic: Why does VTEAX have a purchase fee?
Replies: 32
Views: 2918

Re: Why does VTEAX have a purchase fee?

ruud wrote: Sat Feb 22, 2020 11:51 am
joeschmo wrote: Sat Feb 22, 2020 11:19 am Note that the credit quality distribution is worse on VTEAX/VTEB than eg VWIUX, which is basically all AA+. Even Vanguard PAS doesn’t recommend VTEAX/VTEB but rather 30/40/30 mix of short/interm/long munis.
Doesn't seem so different to me:

Code: Select all

            VTEAX   VWIUX
AAA         22.1%   21.5%
AA          55.0%   49.7%
A           16.0%   20.1%
BBB          6.4%    6.5%
BB                   0.6%
B or lower           0.1%
NR           0.5%    1.5%
Source: VTEAX VWIUX.
Weird, must have been comparing with something else. Too bad I just bought a ton of VWIUX; seems like VTEB is a bit better quality. I was trying to avoid long maturity though...
by joeschmo
Sat Feb 22, 2020 11:19 am
Forum: Investing - Theory, News & General
Topic: Why does VTEAX have a purchase fee?
Replies: 32
Views: 2918

Re: Why does VTEAX have a purchase fee?

Note that the credit quality distribution is worse on VTEAX/VTEB than eg VWIUX, which is basically all AA+. Even Vanguard PAS doesn’t recommend VTEAX/VTEB but rather 30/40/30 mix of short/interm/long munis.
by joeschmo
Fri Feb 21, 2020 1:40 pm
Forum: Investing - Theory, News & General
Topic: Difference between short-term TIPS funds?
Replies: 71
Views: 7888

Re: Difference between short-term TIPS funds?

What's the practical recommendation based on this? Don't buy anything except individual short-term TIPS? In my fortunate and rare case, I have a couple million dollars planned allocation to VTIP and it seems a little insane to manage individual TIPS....
by joeschmo
Fri Feb 21, 2020 9:11 am
Forum: Investing - Theory, News & General
Topic: How do you objectively set Stock vs Bond Allocation
Replies: 81
Views: 7640

Re: How do you objectively set Stock vs Bond Allocation

Very hard to objectively assess risk level and translate that into an allocation. Guesses on top of guesses. One former Boglehead suggested taking the percentage of loss you could tolerate e.g. 30% and then doubling that as your equity allocation so --that would be 60/40. Many equity "corrections" rarely exceed 50% before recovering. So a 60% equity most likely would not drop your 60/40 portfolio by more than 30%. Speaking as someone who only started investing at 37, after a lifetime of being clueless and terrified: Risk tolerance questionnaires never made a lick of sense to me before I started learning more about investing. And once I *did* learn more about investing, I found them useless anyway -- I'd either be greedy and only ...
by joeschmo
Fri Feb 21, 2020 8:29 am
Forum: Investing - Theory, News & General
Topic: Difference between short-term TIPS funds?
Replies: 71
Views: 7888

Re: Difference between short-term TIPS funds?

If the TIPS bring held to maturity did not nature around mid-2015, the same market valuations of the TIPS held by the fund would apply to individual TIPS. The return of the TIPS you are holding up to a point in time is based on their market value at that point in time, just like for a TIPS fund. TIPS, whether held in a fund or held directly, lost value when interest rates rose in 2015 unless they matured in some time interval in 2015. The return one gets from a TIPS held to maturity is not affected at all by any changes in the price that that particular TIPS would fetch on the secondary market at any point in time. To illustrate... A TIPS Parable Larry, Moe, and Curly all buy $10k of “TIPS” on the same date in 2020. Larry buys individual 1...
by joeschmo
Wed Feb 19, 2020 11:25 pm
Forum: Investing - Theory, News & General
Topic: How do you objectively set Stock vs Bond Allocation
Replies: 81
Views: 7640

Re: How do you objectively set Stock vs Bond Allocation

joeschmo wrote: Wed Feb 19, 2020 7:38 am It would be great to see a study on what risk tolerance questionnaire aspects best predict actual risk tolerance, since even the most objective stock/bond allocation is only objective if the user will stick to it.

Has anyone done academic studies on risk tolerance and what people will actually stick to? Vanguard makes such a huge deal of their "worst loss / best gain" historical data, but if I pick a stock/bond allocation based on that, how will real human investors actually behave when a big loss happens?
This is almost it: https://www.cfainstitute.org/-/media/do ... 1-pdf.ashx
by joeschmo
Wed Feb 19, 2020 3:08 pm
Forum: Investing - Theory, News & General
Topic: How do you objectively set Stock vs Bond Allocation
Replies: 81
Views: 7640

Re: How do you objectively set Stock vs Bond Allocation

FelixTheCat wrote: Wed Feb 19, 2020 3:02 pm
firebirdparts wrote: Tue Feb 18, 2020 9:12 pm It's very personal, really. There's no objectivity.
+1 2008/09 turned my 401K into a 201k. :shock: I realized I couldn't handle my asset allocation. I dialed it back so I can sleep at night what ever the market decides to do.
I’m sorry for your loss! This is why I made my posts above though. It IS objectively a good strategy to keep an allocation that lets you sleep no matter what the market does.
by joeschmo
Wed Feb 19, 2020 2:44 pm
Forum: Personal Investments
Topic: Canceling the Vanguard PAS
Replies: 12
Views: 2300

Re: Canceling the Vanguard PAS

Would you be willing to share the asset allocation % that he had for you, as well as time horizon and approximate total investable assets? I don’t care about your personal situation of course but am very interested to learn from what they do. Any TIPS or tips? Anything you can share would be grand!