Search found 527 matches

by danielc
Thu Jan 17, 2019 9:29 pm
Forum: Investing - Theory, News & General
Topic: Bogle "5% Gold"
Replies: 36
Views: 3514

Re: Bogle "5% Gold"

I suggest that you read this article from the Miami Herald. They report that many Venezuelans are selling their gold for currency in pawn shops and then immediately buying food with it. You are correct that the pawn shops they are selling their jewelry to aren't giving them a fair market price for ...
by danielc
Thu Jan 17, 2019 7:57 pm
Forum: Investing - Theory, News & General
Topic: Bogle "5% Gold"
Replies: 36
Views: 3514

Re: Bogle "5% Gold"

*Ask a Venezuelan if it is worthwhile to have a little gold. I am a Venezuelan. I do not think that it is at all worthwhile to have a little gold. Venezuelans are NOT using gold as an alternate currency right now, and no Venezuelan would have the faintest clue of what a fair price for a gold coin w...
by danielc
Tue Jan 15, 2019 9:59 pm
Forum: Investing - Help with Personal Investments
Topic: Need Help and Opinions - Debt Payoff
Replies: 13
Views: 468

Re: Need Help and Opinions - Debt Payoff

Without any doubt, just pay them. Seriously. It is impossible to find a better investment than to pay off a debt that charges you 8%. This is equivalent to a zero-risk guaranteed 8% return tax-free. Any investor would kill for an investment like that. Just write two cheques today and pay them both i...
by danielc
Tue Jan 15, 2019 8:35 pm
Forum: Investing - Theory, News & General
Topic: "College Endowments Badly Trail The Market"
Replies: 18
Views: 1914

Re: "College Endowments Badly Trail The Market"

Wow... 5.53% below a 60/40 stock/treasury mix? !! How is that possible? How do you manage to under-perform by 5.53%? I just checked, and the inflation-adjusted return of a 60/40 stock/treasury mix over the last 30 years has been only 9%. So their real return is only 3.47% !!! EDIT: Corrected my calc...
by danielc
Tue Jan 15, 2019 8:28 pm
Forum: Personal Finance (Not Investing)
Topic: Amazon Rewards Visa -- predatory lending?
Replies: 29
Views: 3736

Re: Amazon Rewards Visa -- predatory lending?

In your first post you said "if this is true, I definitely don't want the card." Have you changed your mind? I won't get the card. Even though the card I already have surely has the same restriction, I feel more comfortable not owning as many credit cards unless there is a really good benefit to ge...
by danielc
Mon Jan 14, 2019 7:10 pm
Forum: Personal Finance (Not Investing)
Topic: Amazon Rewards Visa -- predatory lending?
Replies: 29
Views: 3736

Re: Amazon Rewards Visa -- predatory lending?

I'd like to thank everyone who responded. I can't believe I had such a fundamental misunderstanding of how credit cards work. I've just never experienced this because I never carry over a balance. Also, before about 18 months ago my only credit card was a German one that works quite differently from...
by danielc
Mon Jan 14, 2019 7:07 pm
Forum: Personal Finance (Not Investing)
Topic: Amazon Rewards Visa -- predatory lending?
Replies: 29
Views: 3736

Re: Amazon Rewards Visa -- predatory lending?

If this is true, I definitely don't want the card. Because you don't trust autopay to work, or because you think it indicates the issuer is particularly sleazy? A combination of "sleazy" with "card with worse terms than most other cards". --- But over the course of this thread I have discovered tha...
by danielc
Mon Jan 14, 2019 7:03 pm
Forum: Personal Finance (Not Investing)
Topic: Amazon Rewards Visa -- predatory lending?
Replies: 29
Views: 3736

Re: Amazon Rewards Visa -- predatory lending?

Isn't this the way that every credit card out there works? Obviously I haven't read all their TOS, but the ones I have charge interest on new purchases if you carry a balance. Not sure if there is really anything here to get upset about this particular card. Apparently you're right. Everyone here s...
by danielc
Mon Jan 14, 2019 9:43 am
Forum: Personal Finance (Not Investing)
Topic: Amazon Rewards Visa -- predatory lending?
Replies: 29
Views: 3736

Amazon Rewards Visa -- predatory lending?

I've been thinking about possibly getting the Amazon Rewards Visa card , and the very first review said this: This card has sneaky interest rate policies... I received my first statement and paid all but $25 (by accident, meant to pay in full) on time. So my carryover balance was $25, which I would ...
by danielc
Sun Jan 13, 2019 6:36 pm
Forum: Personal Finance (Not Investing)
Topic: Pay off a 30 year mortgage in 15 years? The cost of flexibility
Replies: 79
Views: 7386

Re: Pay off a 30 year mortgage in 15 years? The cost of flexibility

According to Bankrate.com, the 30 year mortgage interest rate as of 1/9/2019 was 5.01%. On this same day, 15 year mortgage rates were 4.07%. willthrill81, The answer is highly dependent on the specific circumstances. In my case, it was A) 30 years at 3.49% B) 15 years at 3.00% It was close to a no-...
by danielc
Sun Jan 13, 2019 6:32 pm
Forum: Personal Finance (Not Investing)
Topic: Pay off a 30 year mortgage in 15 years? The cost of flexibility
Replies: 79
Views: 7386

Re: Pay off a 30 year mortgage in 15 years? The cost of flexibility

You do pay a cost for the flexibility. They are not talked about/promoted as often as 15 and 30 year mortgages, but there are other periods available, 10 year, 20 year, etc. I came accross this interesting statistic: Of all home mortgages, 90 % are 30 year, 6% 15 year, and only 2% the other. 12% ar...
by danielc
Sun Jan 13, 2019 6:25 pm
Forum: Personal Finance (Not Investing)
Topic: Keeping up with inflation?
Replies: 18
Views: 2354

Re: Keeping up with inflation?

Everything I read says you've got to invest in stocks to 'keep up with inflation'. But doesn't it all come down to what you spend money on? Gas is dependant on oil prices, and right now gas where I live in NJ is just over $2 a gallon. Same thing with food.. buy the store brands and what's on sale, ...
by danielc
Sun Jan 13, 2019 1:02 pm
Forum: Investing - Help with Personal Investments
Topic: Fidelity Zero Funds
Replies: 33
Views: 1920

Re: Fidelity Zero Funds

From my perspective the issue is more with your understanding of indexing and how it works or the belief in some magical nature of name indexes than problems with what Fidelity is doing. How can you possibly judge my understanding of how indexing works? How can you possibly decide that I or anyone ...
by danielc
Sun Jan 13, 2019 10:10 am
Forum: Investing - Help with Personal Investments
Topic: Fidelity Zero Funds
Replies: 33
Views: 1920

Re: Fidelity Zero Funds

From my perspective the issue is more with your understanding of indexing and how it works or the belief in some magical nature of name indexes than problems with what Fidelity is doing. How can you possibly judge my understanding of how indexing works? How can you possibly decide that I or anyone ...
by danielc
Sun Jan 13, 2019 9:57 am
Forum: Investing - Help with Personal Investments
Topic: Fidelity Zero Funds
Replies: 33
Views: 1920

Re: Fidelity Zero Funds

I'm just commenting on OldSport's thread about the fact that Fidelity made its own index. Yes, Fidelity made its own index, just like Standard and Poor's and Russell and MSCI. All indices are made by someone and I don't see any reason why Fidelity's index would be inferior to anyone else's made up ...
by danielc
Sun Jan 13, 2019 9:55 am
Forum: Investing - Theory, News & General
Topic: Any thoughts on the role of Gold in your portfolio?
Replies: 100
Views: 5331

Re: Any thoughts on the role of Gold in your portfolio?

Personally, I view gold as a speculative play. It has no earnings and I do not invest in anything which would have no hope of earnings. There are commodities traders who would disagree, of course. +1 Gold has no cashflows. A present value calculation of future cashflows will show that its fair mark...
by danielc
Sun Jan 13, 2019 9:38 am
Forum: Investing - Help with Personal Investments
Topic: Fidelity Zero Funds
Replies: 33
Views: 1920

Re: Fidelity Zero Funds

Every index has rules about what goes in and what stays out. Why would an index created by Fidelity be inherently inferior than an index created by S&P or Russell? Because S&P and Russell have been making indices for a long time so their pros and cons are relatively well understood, while Fidelity ...
by danielc
Sun Jan 13, 2019 9:32 am
Forum: Investing - Help with Personal Investments
Topic: Fidelity Zero Funds
Replies: 33
Views: 1920

Re: Fidelity Zero Funds

I read that the zero funds are not actual true index funds, like S&P, MSCI, CRSP, Russell, etc. but are generic Fidelity constructed "index" funds from a smaller amount of stocks from a true index. I did not know that. That is helpful to know. That seems to be the case. Here's the prospectus for "F...
by danielc
Sun Jan 13, 2019 1:02 am
Forum: Investing - Help with Personal Investments
Topic: SEI Investments = bad deal?
Replies: 9
Views: 526

Re: SEI Investments = bad deal?

What's SEI? A wealth management company. Is it this company? I don't know them. I'm looking through their website, but I'm mostly confused. I'm having trouble figuring out what they offer or what their fees are. I thought that if you were self-employed you could basically get a 401k with anyone. I ...
by danielc
Sun Jan 13, 2019 12:52 am
Forum: Investing - Help with Personal Investments
Topic: Fidelity Zero Funds
Replies: 33
Views: 1920

Re: Fidelity Zero Funds

I read that the zero funds are not actual true index funds, like S&P, MSCI, CRSP, Russell, etc. but are generic Fidelity constructed "index" funds from a smaller amount of stocks from a true index. I did not know that. That is helpful to know. That seems to be the case. Here's the prospectus for "F...
by danielc
Sun Jan 13, 2019 12:33 am
Forum: Investing - Help with Personal Investments
Topic: SEI Investments = bad deal?
Replies: 9
Views: 526

Re: SEI Investments = bad deal?

Our 401k is set up through SEI. We’re self employed and our accountant’s firm is partnered with an investment firm, so we went with their suggestion on SEI. I haven’t really thought about switching until I searched this forum and found that some people think they’re fees are high, we’re paying 1%. ...
by danielc
Sat Jan 12, 2019 9:02 pm
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of taking all risk on equity side?
Replies: 63
Views: 3556

Re: What are the disadvantages of taking all risk on equity side?

Then we are talking about two different things. I am talking about the bond allocation in your investment portfolio which you won’t draw down until you retire. I am assuming you are decades away from that point. You seem to be talking about using the proceeds from bonds for some shorter term spendi...
by danielc
Sat Jan 12, 2019 4:22 pm
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of taking all risk on equity side?
Replies: 63
Views: 3556

Re: What are the disadvantages of taking all risk on equity side?

Because nominal Treasuries are not company stock. They have a fully predictable cashflow and the only risk I have is the risk of having to sell them before maturity (also add inflation risk for long maturities). This is also why I am willing to hold individual treasuries but I am not willing to hol...
by danielc
Sat Jan 12, 2019 1:02 pm
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of taking all risk on equity side?
Replies: 63
Views: 3556

Re: What are the disadvantages of taking all risk on equity side?

What would you call someone who invests in equities based on whether they are cheap or expensive, or whether they “fairly compensate you for the risk” at a certain point in time? Obviously, a market timer. Why should it be any different for bonds? Because nominal Treasuries are not company stock. T...
by danielc
Sat Jan 12, 2019 8:49 am
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of taking all risk on equity side?
Replies: 63
Views: 3556

Re: What are the disadvantages of taking all risk on equity side?

OP, perhaps the problem is that your emergency fund is not large enough for comfort? Increasing the size of it might satisfy your need for a "risk-free asset bucket". If it winds up large enough to seriously affect your yield, you could hold an equal amount of long bonds so that your overall fixed ...
by danielc
Sat Jan 12, 2019 8:45 am
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of taking all risk on equity side?
Replies: 63
Views: 3556

Re: What are the disadvantages of taking all risk on equity side?

Note: I think putting all your risk in equities makes sense. One reason it could be bad is that you’ll likely hear about it before other investments which could cause you to deviate from your plan. You’re more likely to hear about a crash in S&P than a downturn in REITs, high yield bonds, or small ...
by danielc
Sat Jan 12, 2019 8:38 am
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of taking all risk on equity side?
Replies: 63
Views: 3556

Re: What are the disadvantages of taking all risk on equity side?

30 years are still yielding more than 10 years. It’s the middle of the curve that’s inverted. But regardless of what the curve is doing now, long tends to beat medium tends to beat short. Betting on anything else is just market timing. You make it sound like looking at the yield curve is gambling. ...
by danielc
Fri Jan 11, 2019 9:44 pm
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of taking all risk on equity side?
Replies: 63
Views: 3556

Re: What are the disadvantages of taking all risk on equity side?

You are missing the true measure of diversification, which is the portfolio's correlation to stock market. When the stock market crashes, how likely is it that the rest of your portfolio will crash with it? If that's the definition you want to use (and I think it's a very good definition) then a ve...
by danielc
Fri Jan 11, 2019 6:33 pm
Forum: Investing - Theory, News & General
Topic: Are REITs better to purchase when interest rates are high or low?
Replies: 64
Views: 4301

Re: Are REITs better to purchase when interest rates are high or low?

That has nothing to do with what I said. Please re-read. I said "what about diversification?" That's why you diversify geographically, providers, property type, investment niche, etc., all within real estate. Yeah, that would be the goal. That would be diversified. Now how many properties can most ...
by danielc
Fri Jan 11, 2019 6:27 pm
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of taking all risk on equity side?
Replies: 63
Views: 3556

Re: What are the disadvantages of taking all risk on equity side?

I interpret "taking all the risk on the equity side" to mean taking out risk on the bond side, in other words, keeping the equity allocation the same but shortening duration on your bonds. Ok. That's not how I interpret it. To me it means that all the risky assets are equities. But the bond/stock r...
by danielc
Fri Jan 11, 2019 4:03 pm
Forum: Investing - Theory, News & General
Topic: Did you ever "win" big?
Replies: 133
Views: 9559

Re: Did you ever "win" big?

I know we live in the world of a 3 fund portfolio. But my question is did you ever have a stock pick that paid you a very handsome return? I began investing when I was young, right at the beginning of the stock market crash in 2008 or so. I blindly DCA'd my money into a broad total market ETF as ev...
by danielc
Fri Jan 11, 2019 3:58 pm
Forum: Investing - Theory, News & General
Topic: Are REITs better to purchase when interest rates are high or low?
Replies: 64
Views: 4301

Re: Are REITs better to purchase when interest rates are high or low?

What about diversification? I would be terrified to own a property and then have a major repair. Repair costs are factored into your analysis. 5% repair 5% vacancy 8% property management cost (whether or not you manage yourself) of gross rents, if it still cash flows then you have a great investmen...
by danielc
Fri Jan 11, 2019 3:48 pm
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of taking all risk on equity side?
Replies: 63
Views: 3556

Re: What are the disadvantages of taking all risk on equity side?

Two disadvantages: 1. Lower returns in the long run 2. Worse diversification of your equity allocation I don't see how those are true. (1) The total return can be brought back up by increasing the size of the stock allocation. Presumably the debate is between some baseline Total Bond / Total Stock ...
by danielc
Fri Jan 11, 2019 3:41 pm
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of taking all risk on equity side?
Replies: 63
Views: 3556

Re: What are the disadvantages of taking all risk on equity side?

Well said. I made a different choice than you -- I chose short-term (1 year) Treasuries instead of Total Bond. I don't know whether this choice is theoretically optimal, but I know that it is a perfectly good choice and I strongly feel that it fits my temperament better. I find it easier to ignore ...
by danielc
Fri Jan 11, 2019 10:51 am
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of taking all risk on equity side?
Replies: 63
Views: 3556

Re: What are the disadvantages of taking all risk on equity side?

My personal judgement is, first, that "stay the course" is the Prime Directive and that since the course I chose involved Total Bond for my non-stock allocation, I would need a very convincing reason to change a reasonably sound decision; second, that the extra risk of bonds-over-cash is almost inv...
by danielc
Fri Jan 11, 2019 10:42 am
Forum: Investing - Theory, News & General
Topic: Are REITs better to purchase when interest rates are high or low?
Replies: 64
Views: 4301

Re: Are REITs better to purchase when interest rates are high or low?

fire4fun wrote:
Fri Jan 11, 2019 1:22 am
My advice - own real property. Better returns, second to none tax incentives, more control, wealth building legacy. REITs aren't worth the paper they are printed on IMHO.
What about diversification? I would be terrified to own a property and then have a major repair.
by danielc
Thu Jan 10, 2019 8:54 am
Forum: Investing - Theory, News & General
Topic: Portfolio of Leveraged Exchange Traded Funds
Replies: 33
Views: 1746

Re: Portfolio of Leveraged Exchange Traded Funds

Some people get their equity exposure via futures. Each month they roll over to a new set of contracts. Is this active? I would call that active. If this is your definition then VFINX is an active fund. https://personal.vanguard.com/pub/Pdf/p040.pdf From their prospectus "To help stay fully investe...
by danielc
Thu Jan 10, 2019 8:52 am
Forum: Investing - Theory, News & General
Topic: Portfolio of Leveraged Exchange Traded Funds
Replies: 33
Views: 1746

Re: Portfolio of Leveraged Exchange Traded Funds

Some people get their equity exposure via futures. Each month they roll over to a new set of contracts. Is this active? I would call that active. There’s nothing active about that if you are just rolling your futures to maintain exposure. It’s as passive as it gets. Cheers :greedy We are literally ...
by danielc
Wed Jan 09, 2019 9:11 pm
Forum: Investing - Theory, News & General
Topic: Portfolio of Leveraged Exchange Traded Funds
Replies: 33
Views: 1746

Re: Portfolio of Leveraged Exchange Traded Funds

Some people get their equity exposure via futures. Each month they roll over to a new set of contracts. Is this active? I would call that active. Rules based, broad exposure to the market (a.k.a. Beta), no active choices done in weighting, specific securities. It is trying to replicate and reflect ...
by danielc
Wed Jan 09, 2019 5:31 pm
Forum: Personal Finance (Not Investing)
Topic: Too many credit cards?
Replies: 54
Views: 2805

Re: Too many credit cards?

I agree that Americans put way too much emphasis on credit cards, and rewards, and stuff like that. I have two credit cards. I picked the one I like best and I ignore the other. This way I only have one statement and one card to keep track of. I am not a "real" American, but how can you complain ab...
by danielc
Wed Jan 09, 2019 5:15 pm
Forum: Investing - Theory, News & General
Topic: Portfolio of Leveraged Exchange Traded Funds
Replies: 33
Views: 1746

Re: Portfolio of Leveraged Exchange Traded Funds

It is not gambling nor rebalancing. It is about creating a synthetic exposure to equities. It is not exactly Bogleheads because it is complex. This does not mean it is wrong or that it is a active strategy. I didn't say that it is wrong. People can do whatever they want with their money. I think mo...
by danielc
Wed Jan 09, 2019 4:48 pm
Forum: Investing - Theory, News & General
Topic: Portfolio of Leveraged Exchange Traded Funds
Replies: 33
Views: 1746

Re: Portfolio of Leveraged Exchange Traded Funds

The strategies studied in the paper require only monthly trading of leveraged ETFs for rebalancing. Rebalancing is commonly advocated by Bogleheads. MONTHLY rebalancing is never advocated by Bogleheads. Bogleheads argue about whether yearly rebalancing is too frequent. A lot of us think that every ...
by danielc
Wed Jan 09, 2019 4:30 pm
Forum: Investing - Theory, News & General
Topic: Portfolio of Leveraged Exchange Traded Funds
Replies: 33
Views: 1746

Re: Portfolio of Leveraged Exchange Traded Funds

Beliavsky wrote:
Wed Jan 09, 2019 4:13 pm
Leveraged exchange traded funds (LETFs) are marketed as short-term trading vehicles that magnify the daily returns of an underlying index.
Short-term trading is gambling, not investing. It doesn't make sense to write than sentence, and then talk about 10 year returns, or reducing downside risk.
by danielc
Wed Jan 09, 2019 1:00 am
Forum: Personal Finance (Not Investing)
Topic: Too many credit cards?
Replies: 54
Views: 2805

Re: Too many credit cards?

For most of my life I never had a credit card. Despite everyone telling me how having one would increase my credit score and give me "rewards", I just wasn't interested. I thought: "These companies only make money when someone makes a mistake in managing their own finances. I don't want to do busin...
by danielc
Wed Jan 09, 2019 12:08 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Does The Bucket Approach Destroy Wealth?
Replies: 56
Views: 5764

Re: Larry Swedroe: Does The Bucket Approach Destroy Wealth?

https://www.advisorperspectives.com/articles/2019/01/07/does-the-bucket-approach-destroy-wealth?bt_ee=FTU%2FsBNf%2FLUiHMmWwiQ4s%2FPvcHZiqdidGGmLKie5LRuYO378o7HycRIbJqe0nQFi&bt_ts=1546956764657 In this article Larry goes into significant depth on retirement planning with Monte Carlo Simulation. MCS ...
by danielc
Tue Jan 08, 2019 3:21 am
Forum: Investing - Theory, News & General
Topic: Fees of index funds (US vs non-US domicile)
Replies: 1
Views: 240

Re: Fees of index funds (US vs non-US domicile)

What is the reason for index funds not domiciled in the US having such high expense ratios? Is it merely the smaller size of the funds and the less fierce competition? For example, one popular fund for European bogleheads is the BlackRock iShares Core MSCI World UCITS ETF , which has an expense rat...
by danielc
Mon Jan 07, 2019 11:57 am
Forum: Investing - Theory, News & General
Topic: Why Total Bond Market over CDs?
Replies: 22
Views: 2567

Re: Why Total Bond Market over CDs?

Hi all. I have read many books on the subject. Lately, Larry Swedroe is making the most sense to me. Why not buy IRA CDs instead of investing in Total Bond Market? I would like to hear a case for both sides please. I also have some TIPS. But at the end of the day, aren’t CDs the safest product, and...
by danielc
Mon Jan 07, 2019 11:31 am
Forum: Investing - Theory, News & General
Topic: Avoid rebalancing between risky assets. Let bulls run.
Replies: 33
Views: 2769

Re: Avoid rebalancing between risky assets. Let bulls run.

If it's not about risk why did you use two risk metrics, standard deviation and sharpe ratio, and only one return metric, annualised return, to analyze your thesis? That led to confusing. You were the only one who was "confused". You just didn't read the post. No hard feelings though. Take care.
by danielc
Mon Jan 07, 2019 7:58 am
Forum: Investing - Theory, News & General
Topic: Avoid rebalancing between risky assets. Let bulls run.
Replies: 33
Views: 2769

Re: Avoid rebalancing between risky assets. Let bulls run.

... Presumably US and ex-US stocks have a similar risk profile. So "managing risk" is not a reason for rebalancing in this instance... If you don't view domestic/international stocks as having a different risk profile, there is probably a stronger case to simply hold at global market-cap weighting ...