Search found 123 matches

by Paul Puckett
Sun Jul 19, 2009 8:21 pm
Forum: Investing - Theory, News & General
Topic: How do investors save themselves from themselves?
Replies: 12
Views: 1950

It's difficult

All an investor has to do is avoid watching the news, live their lives, enjoy themselves, etc., after setting up a rational allocation. It's the focus on the short-term that prevents the average investor from doing well.

Just my humble opinion.....Best, Paul
by Paul Puckett
Sun Jul 19, 2009 8:19 pm
Forum: Investing - Theory, News & General
Topic: question about Morningstar analysis of VG Intermediate Treas
Replies: 10
Views: 1798

Bonds

I'm not an economist, but I do manage money. I seem to recall that interest rate cycles run around a 30 year period. My advice is to be very careful with your duration on the overall bond portfolio. Not saying to avoid intermediates and long terms, I don't have a crystal ball, but this is probably n...
by Paul Puckett
Sun Jul 19, 2009 8:15 pm
Forum: Investing - Theory, News & General
Topic: FINRA is Right: Leveraged ETFs Dangerous to Your Finances
Replies: 11
Views: 2075

Leveraged ETFs

What is really amusing is that a best selling book recommends leveraged ETFs for the average retail investor. The Ultimate Depression Survival Guide, by Martin Weiss, recommends leveraged ETF's in their portfolios for average investors.

Whoa!
by Paul Puckett
Fri Jun 12, 2009 2:03 pm
Forum: Investing - Theory, News & General
Topic: What are the drawbacks,if any,of the Boglehead philosophy?
Replies: 111
Views: 12910

Biggest Drawbacks to Boglehead Investment Management

1) The free time (not spent analyzing M* and other data to determine which active manager deserves a spot in your investment stable) 2) Even in those years where you have the highest return at the cocktail party, you can't claim to have "picked" a great manager. 3) Lack of stress (some peo...
by Paul Puckett
Thu Jun 11, 2009 3:17 pm
Forum: Personal Finance (Not Investing)
Topic: An Adviser (Mine) Is Charged With Fraud
Replies: 10
Views: 2600

IWhile waiting for whatever would come of my letters, I learned how to look up these bozo's on the SEC site - sure enough, he had had a previous complaint against him. The most underreported aspect of the Madoff Ponzi is that he did it within a hedge fund. His fund was unregistered until 2006 when ...
by Paul Puckett
Thu Jun 11, 2009 11:48 am
Forum: Investing - Theory, News & General
Topic: Question on Inverse ETF's
Replies: 13
Views: 1304

Re: Makes Sense

You're welcome! 2/3 SPY and 1/3 RSW sounds like just about the dumbest idea possible. On any one given day that portfolio would be expected to end flat (RSW being -2x SPY) so over time you'll just be losing money to expense fees. Then if the long term market is flattish or up you'll lose money on R...
by Paul Puckett
Thu Jun 11, 2009 11:48 am
Forum: Investing - Theory, News & General
Topic: Question on Inverse ETF's
Replies: 13
Views: 1304

Re: Makes Sense

You're welcome! 2/3 SPY and 1/3 RSW sounds like just about the dumbest idea possible. On any one given day that portfolio would be expected to end flat (RSW being -2x SPY) so over time you'll just be losing money to expense fees. Then if the long term market is flattish or up you'll lose money on R...
by Paul Puckett
Thu Jun 11, 2009 11:34 am
Forum: Investing - Theory, News & General
Topic: Question on Inverse ETF's
Replies: 13
Views: 1304

Makes Sense

I was reading about volatility drag and your explanation makes sense to me. I think the authors recommendation that the average retail, buy and hold, investor should put 2/3 in SPY and 1/3 in RSW is more problematic than I thought. Which is particularly worrisome, because I already thought it was a ...
by Paul Puckett
Thu Jun 11, 2009 11:10 am
Forum: Investing - Theory, News & General
Topic: Question on Inverse ETF's
Replies: 13
Views: 1304

Question on Inverse ETF's

First, I am not in any way shape or form using or recommending this approach. A best selling book is touting the use of inverse index funds to hedge against the coming great depression #2. I hadn't looked at the short ETF's in any detail and was surprised by the performance of RSW which is billed as...
by Paul Puckett
Thu Jun 11, 2009 11:06 am
Forum: Investing - Theory, News & General
Topic: What other investment forums are you frequenting?
Replies: 30
Views: 4749

FLGator, I've looked at several different forums and so far, Bogleheads is the only one that I would recommend. Morningstar might end up making my list, but there is a lot of disinformation and aggressiveness with some of the participants (not in the Vanguard Diehard area!) I'm still checking them o...
by Paul Puckett
Thu Jun 11, 2009 9:48 am
Forum: Personal Finance (Not Investing)
Topic: Need some career advice...
Replies: 30
Views: 4902

Book Recommendation

When I was deciding whether to stay in a corporate environment, a friend gave me the book, Crossing the Unknown Sea - Work as a Pilgrimage of Identity, by David Whyte. The author is a poet and wrote a book using a sea voyage as a metaphor for life and the decisions we make. You might either confirm ...
by Paul Puckett
Thu Jun 11, 2009 9:41 am
Forum: Personal Finance (Not Investing)
Topic: An Adviser (Mine) Is Charged With Fraud
Replies: 10
Views: 2600

Article

Adrian, thanks for posting that article. I saw the write up in investment news, but your article was more personal and gave more detail. While a client was on their deathbed! Unreal. I have always felt that the majority of investors might be happier if they had a knowledgeable, ethical, and honest a...
by Paul Puckett
Wed Jun 10, 2009 3:49 pm
Forum: Investing - Help with Personal Investments
Topic: insurance question
Replies: 5
Views: 1374

Gordon, It depends, but generally speaking yes. I'm assuming your only asking about fixed deferred and fixed spia. Variable is a different beast. Generally, commissions for fixed deferred contracts range from 1-10+% and SPIA's are usually 1-3% for most carriers. Both can have the commissions reduced...
by Paul Puckett
Wed Jun 10, 2009 7:24 am
Forum: Personal Finance (Not Investing)
Topic: Question about a trust
Replies: 29
Views: 3667

You should talk to your attorney, assuming they are specialist in the trust and estate area. If you need to find one, I'd start with www.naela.org. Their attorneys are certified in elder law. I'm a former trust officer, not an attorney, so I'll give a specific answer that you should check with someo...
by Paul Puckett
Tue Jun 09, 2009 8:41 pm
Forum: Personal Consumer Issues
Topic: What Book Are YOU Currently Reading? PART II
Replies: 1043
Views: 288951

I've heard that The Fountainhead is better, but I'm not sure I'm willing to give Ms. Rand another chance. I've read both at least a dozen times and I only read every page of Galt's speech once. Atlas Shrugged is her masterpiece, but Fountainhead is the better read, IMHO Hope you enjoy! Paul
by Paul Puckett
Tue Jun 09, 2009 5:08 pm
Forum: Personal Consumer Issues
Topic: What Book Are YOU Currently Reading? PART II
Replies: 1043
Views: 288951

I'm midway through rereading Atlas Shrugged , by Ayn Rand. I don't know if the current times make it better, or better comprehension makes it better. At any rate, it's better the second time around. Though, usually after 400 pages you are close to the end of a book, not just one third finished! Sam...
by Paul Puckett
Tue Jun 09, 2009 5:04 pm
Forum: Personal Consumer Issues
Topic: Cordless Lawn Mowers
Replies: 13
Views: 2473

Re: why do you have a lawn?

My suggestion is to look into replacing your lawn with natural plantings, with low (er) water and no pesticide/herbicide use. If you have a home owner's association that requires a lawn, you can simply keep a small strip behind which would be a lovely and interesting scene you wouldn't have to mow ...
by Paul Puckett
Tue Jun 09, 2009 3:07 pm
Forum: Investing - Help with Personal Investments
Topic: Bond Funds for the Long Term (8 - 12 years)
Replies: 18
Views: 3159

Espresso yes

Paul, I think duration is expressed in number of years and not in %. The Vanguard web site says the duration of VBMFX is 4.0 years and the SEC yield is 4.02%. I assume that is what you meant. Have you had your espresso yet ? Nitpicking Munir OK, I've had my espresso and it was excellent. You aren't...
by Paul Puckett
Tue Jun 09, 2009 2:41 pm
Forum: Investing - Help with Personal Investments
Topic: Bond Funds for the Long Term (8 - 12 years)
Replies: 18
Views: 3159

Re: Duration

If the Vanguard Total Bond Fund has a duration or 4%, according to the Vanguard Website, and rates rise 1% we would expect the NAV to drop 4%. Paul Paul, Did you mean to say a duration of ?? Yes, it took me a minute to notice what you meant which means that it must be approaching espresso time, ah,...
by Paul Puckett
Tue Jun 09, 2009 1:02 pm
Forum: Investing - Help with Personal Investments
Topic: Variable annunites w/ riders
Replies: 18
Views: 5704

e) Variable annuities are complicated packages of several different things. You should be aware of a product called a "single-premium immediate annuity" (SPIA) which is just a lifetime payout contract--a personal pension--without an investment plan mixed in. You buy an SPIA from an insura...
by Paul Puckett
Tue Jun 09, 2009 12:54 pm
Forum: Investing - Help with Personal Investments
Topic: Bond Funds for the Long Term (8 - 12 years)
Replies: 18
Views: 3159

Re: Duration

There are some interest rate increases that should be feared by nominal bondholders because they might result in a permanent loss of capital. These would be moves that result from unexpectedly high inflation and a permanent increase in inflation expectations. One advantage of TIPS in this scenario ...
by Paul Puckett
Tue Jun 09, 2009 11:39 am
Forum: Investing - Help with Personal Investments
Topic: Variable annunites w/ riders
Replies: 18
Views: 5704

Re: Don't do it

I can direct you to a thread from March 2009 which discussed a particular product, which remained fairly civil. You'll notice that when these products are looked at objectively, the hyperbole from those who really aren't qualified to offer an opinion on the products disappears. It's a refreshing ch...
by Paul Puckett
Tue Jun 09, 2009 10:22 am
Forum: Investing - Help with Personal Investments
Topic: Bond Funds for the Long Term (8 - 12 years)
Replies: 18
Views: 3159

Duration

One of the things I like about this forum is that rather than look this up, I'll just toss it to you guys as I think it relates to the original post. If the Vanguard Total Bond Fund has a duration or 4%, according to the Vanguard Website, and rates rise 1% we would expect the NAV to drop 4%. If the ...
by Paul Puckett
Tue Jun 09, 2009 6:38 am
Forum: Investing - Help with Personal Investments
Topic: Variable annunites w/ riders
Replies: 18
Views: 5704

Ron, I think the language is confusing. My understanding is that you don't have to annuitize to begin receiving the guaranteed monthly payments on most contracts with this rider. Yes, you do. The link to the prospectus that I posted above doesn't work. Try clicking the link below then click on &quo...
by Paul Puckett
Mon Jun 08, 2009 7:31 pm
Forum: Investing - Help with Personal Investments
Topic: Variable annunites w/ riders
Replies: 18
Views: 5704

That sounds to me like Guaranteed Minimum Income Benefits require annutization. Perhaps you are thinking of Guaranteed Lifetime Withdrawal Benefits. That is not what Susan asked about. Ron Ron, I think the language is confusing. My understanding is that you don't have to annuitize to begin receivin...
by Paul Puckett
Mon Jun 08, 2009 7:26 pm
Forum: Investing - Help with Personal Investments
Topic: Variable annunites w/ riders
Replies: 18
Views: 5704

Here is a link to a Humberto Cruz article on GMIBs. m The main points: You must annuitize to collect on the GMIB. The payout rate on an annuitized GMIB is less than the prevailing payout rate. Read the prospectus. Ron Great Humberto Cruz article. I hadn't seen that one! Don't buy the VA. It is desi...
by Paul Puckett
Mon Jun 08, 2009 6:13 pm
Forum: Investing - Theory, News & General
Topic: What is market timing?
Replies: 55
Views: 4975

the 20+ year record of the trend followers, specifically the so-called turtle traders. there is also 2008. just do a simple backtest since 2000 on the SPX. sell when the 50 crosses the 200 to the downside and do the reverse when the 50 crosses to the upside. you can break it down between going to c...
by Paul Puckett
Mon Jun 08, 2009 3:04 pm
Forum: Investing - Theory, News & General
Topic: Broker Survey
Replies: 10
Views: 1986

Re: Transaction Fees

Of course, you could also just go the Vanguard ETF route and never look back! - DDB Actually I do use Vipers, but they don't cover every sector yet. I also use IShares. I like ETF's, but some of the Vanguard active funds show up in my screen and I hate triggering transaction fees. As a percentage, ...
by Paul Puckett
Mon Jun 08, 2009 2:22 pm
Forum: Investing - Theory, News & General
Topic: What is market timing?
Replies: 55
Views: 4975

Maybe

if market timing doesn't work why did trend followers make so much money in 2008 and over the last decade? a simple 50/200 moving average system would have had you out in dec of 2007. if you went to cash you did good if you went short you made your career or personal portfolio. 2008 results like th...
by Paul Puckett
Mon Jun 08, 2009 1:46 pm
Forum: Investing - Theory, News & General
Topic: What is market timing?
Replies: 55
Views: 4975

Market Timing Simplified?

The way I have always defined "market timing" is that it is more of an attitude than an action. As an example, two investors could simultaneously move 5% of their portfolio from cash to equities, but only one might be timing. If the reason for the trade is a dollar cost averaging transacti...
by Paul Puckett
Sun Jun 07, 2009 12:36 pm
Forum: Investing - Theory, News & General
Topic: What is your Portfolio Plan if you Die?
Replies: 40
Views: 7019

Clarification

Sometimes when I reread my posts, I realize that they don't communicate what I intended. Maybe a story of a client I handled when I was a trust officer will help clarify my previous post. This happens to be about a widow, but I have also worked with men who are left behind and often are uncomfortabl...
by Paul Puckett
Sun Jun 07, 2009 7:58 am
Forum: Investing - Help with Personal Investments
Topic: weird asset allocation problem
Replies: 6
Views: 1324

Trust with IPS

I know this is changing the question slightly, but when you say the trust cannot be moved and must be 50/50, I'm assuming it is an irrevocable trust. I'm not an attorney, but I was a bank trust officer for a decade. It is possible to amend an Irrevocable trust but it takes court approval. In Virgini...
by Paul Puckett
Sat Jun 06, 2009 9:31 pm
Forum: Investing - Theory, News & General
Topic: What is your Portfolio Plan if you Die?
Replies: 40
Views: 7019

Trust with IPS

Sounds like you have some great answers and already have estate planning docs. Just wanted to suggest that you should leave a letter for your wife letting her know that it's ok for her to get help from a professional if she wants to and, naturally, if she doesn't mind managing it then help her out b...
by Paul Puckett
Sat Jun 06, 2009 9:17 pm
Forum: Investing - Theory, News & General
Topic: Broker Survey
Replies: 10
Views: 1986

Transaction Fees

Anybody know if any of these discount brokers have Vanguard Funds with no transaction fee? I use TD Ameritrade Institutional and am happy with them overall. Schwab has a great website, but I haven't found any broker that has a transaction fee for Vanguard Mutual Funds below $19.95. Thanks, Paul
by Paul Puckett
Sat Jun 06, 2009 8:10 pm
Forum: Investing - Theory, News & General
Topic: Vanguards AIG Annuities: Good deal, or risky?
Replies: 31
Views: 5606

Is anyone purchasing the Vanguard(AIG) annuities now, or comfortable with doing so? regards, jr I haven't recently, but I only recommend VA's as 1035 exchanges on highly appreciated VA's that are out of the surrender charge period and in a typical high expense product. Vanguard's VA is the least ex...
by Paul Puckett
Sat Jun 06, 2009 12:18 pm
Forum: Investing - Help with Personal Investments
Topic: Single premium deferred annuities
Replies: 3
Views: 1152

Re: Single premium deferred annuities

When I compare a single premium deferred annuiy with a single premuim immediate annuity I get an internal rate of return for the deferred contract about one half that of a SPIA using same genders and ages. Is this correct and if so approximately how much of the premium goes to the agent versus the ...
by Paul Puckett
Fri Jun 05, 2009 12:38 pm
Forum: Investing - Theory, News & General
Topic: Active beats Passive? - Barron's Magazine
Replies: 18
Views: 3410

My dad was a minister of music and he would occasionally tease the minister about preaching to the choir, so my apologies. Clearly I wasn't sharing anything new!

Best, Paul
by Paul Puckett
Thu Jun 04, 2009 7:36 pm
Forum: Personal Consumer Issues
Topic: Trip to Italy, suggestions?
Replies: 33
Views: 5511

Re: Trip to Italy, suggestions?

The family and I are headed to Italy for a couple of weeks this summer. We are going to Rome , Florence, Venice. Any must sees, great places to eat or other suggestions? Thanks Drum On the west coast of Italy, near Florence, is the Cinque Terre. When you're ready to tire out the kids, and see a gre...
by Paul Puckett
Thu Jun 04, 2009 6:23 pm
Forum: Investing - Theory, News & General
Topic: Active beats Passive? - Barron's Magazine
Replies: 18
Views: 3410

Here is one of my bond funds compared to SPY. m Here are the other bond funds that I have in the same account. m You will notice even my bond funds have performed better. Spam, When comparing bonds to stocks, it's the time period that is most relevant. During time periods where interest rates are d...
by Paul Puckett
Thu Jun 04, 2009 4:04 pm
Forum: Investing - Theory, News & General
Topic: Active beats Passive? - Barron's Magazine
Replies: 18
Views: 3410

How do you figure a 7% average return over the next 10 years? When people say historically, S&P 500 returns 9%-10% a year on average, that INCLUDES 50% downturns... which means we've seen a lot of large up years too... especially as rebounds after a big drop... Case in point, S&P 500 is up,...
by Paul Puckett
Thu Jun 04, 2009 4:01 pm
Forum: Investing - Theory, News & General
Topic: Active beats Passive? - Barron's Magazine
Replies: 18
Views: 3410

Three

one problem that is obvious is comparing funds to S&P 500 when funds might win simply by value loading. Like Dodge and Cox So need to do regression analysis This is the issue that you see sneaking by in so many articles. Dodge and Cox isn't accurately measured by the S&P500, lot's of people...
by Paul Puckett
Thu Jun 04, 2009 3:58 pm
Forum: Investing - Theory, News & General
Topic: Active beats Passive? - Barron's Magazine
Replies: 18
Views: 3410

Two Down

This seems to be a pretty clear case of hindsight being 20/20. If they really want to study this, all they need to do is go back X # of years, look at the biggest funds then , and see how they have performed since . But they already know this, right? Even taking out the tendency for money to pour i...
by Paul Puckett
Thu Jun 04, 2009 8:11 am
Forum: Investing - Theory, News & General
Topic: To BE or NOT TO BE a Boglehead
Replies: 25
Views: 3707

Great Topic

Is there a list of criteria that qualify one to be a boglehead? Philosophically, I am a boglehead, but does my use of some active funds disqualify me? Mel, based on your post I'll try to keep all of my future posts short, I'm worried about being charged per word... Based on recently joining the foru...
by Paul Puckett
Wed Jun 03, 2009 11:31 am
Forum: Investing - Theory, News & General
Topic: Active beats Passive? - Barron's Magazine
Replies: 18
Views: 3410

One Down

To me the main flaw with the article is that it neglects the fact that (contrary to conventional pundit and adviser wisdom) individual investors systematically choose good active AND passive funds alike (see below): m The most conspicuous example of this "good individual fund-picking" phe...
by Paul Puckett
Wed Jun 03, 2009 11:12 am
Forum: Investing - Help with Personal Investments
Topic: Emerging Mkts. What % of your retirement AA
Replies: 35
Views: 4847

Emerging Markets Size

I found this article on investipedia regarding world market share. http://www.investopedia.com/articles/basics/06/alookback.asp Off topic, Russia was 11% of the world stock markets in 1900 according to this article. I guess they are now in the "others" category, since they do not appear in...
by Paul Puckett
Wed Jun 03, 2009 11:01 am
Forum: Investing - Theory, News & General
Topic: Active beats Passive? - Barron's Magazine
Replies: 18
Views: 3410

Active beats Passive? - Barron's Magazine

Interesting article circulating on Morningstar's forum. http://online.barrons.com/article_print/SB124396203771177625.html Just adding, is this the exception that proves the rule that active managers rarely beat their index. What do you think? I'd say there are at least three flaws in the logic, but ...
by Paul Puckett
Wed Jun 03, 2009 10:55 am
Forum: Investing - Help with Personal Investments
Topic: Emerging Mkts. What % of your retirement AA
Replies: 35
Views: 4847

YDNAL, In rereading my quote in your post, I realized that it appeared to be referring to your comment as meaningless, which was unintended. Thanks for not taking it that way. Nothing like woodstock, free love, and all that. Unfortunately I was 7 in 1968, or fortunately depending on how you look at ...
by Paul Puckett
Wed Jun 03, 2009 10:19 am
Forum: Investing - Help with Personal Investments
Topic: Emerging Mkts. What % of your retirement AA
Replies: 35
Views: 4847

Re: Emerging Mkts. What % of your retirement AA

Paul, 1.25% of total portfolio of *anything* is meaningless!... that is, unless your last name is Gates or Buffett. Michelle, I voted 0%. I know, particularly with my own money as it would come out to around $125... On the other hand, you did vote 0% which is probably less exposure than my vote Tha...
by Paul Puckett
Wed Jun 03, 2009 8:59 am
Forum: Investing - Help with Personal Investments
Topic: Emerging Mkts. What % of your retirement AA
Replies: 35
Views: 4847

OK, if I owned DODFX or some American funds or some Vanguard funds which have emerging markets embedded in it ... how do I do the calculation? M* says I have 10% of total portfolio in EM. That's about one-third of my int'l holdings. I'll grant you it is somewhere between 6% and 12%, but I'm not sur...
by Paul Puckett
Wed Jun 03, 2009 8:28 am
Forum: Investing - Help with Personal Investments
Topic: Emerging Mkts. What % of your retirement AA
Replies: 35
Views: 4847

It Depends

For what it's worth, I generally recommend 2.5% of equity for retirees and 5% of for those who are at least five years from retirement. Both numbers are as a percentage of Equities (as opposed to the total portfolio). Ex. In a retiree's portfolio, let's say they have 50% in Equities, the 2.5% of equ...