Search found 792 matches

by bluquark
Mon Oct 21, 2019 4:46 pm
Forum: Investing - Theory, News & General
Topic: Help me think about Pakistani bond
Replies: 51
Views: 3917

Re: Help me think about Pakistani bond

But EM stock 'currency risk' is pretty different than that of EM local currency bonds. Agreed, in fact it's not even clear in what *direction* EM currency depreciation would affect EM stocks, because there are so many countervailing effects. Also, EM bonds are mostly in different countries from the...
by bluquark
Sun Oct 20, 2019 5:22 pm
Forum: Personal Consumer Issues
Topic: GPS to stop working on older phones Nov 3?
Replies: 25
Views: 3342

Re: GPS to stop working on older phones Nov 3?

I read some of the links. They are unhelpful because the question I wanted to know: Where will my old phone's GPS tell me (or actually: google maps) where my phone's current location is? If it tells me within 50 ft where I am, then I would have no problem. I think the resources aren't giving a stra...
by bluquark
Sun Oct 20, 2019 5:14 pm
Forum: Investing - Theory, News & General
Topic: Help me think about Pakistani bond
Replies: 51
Views: 3917

Re: Help me think about Pakistani bond

Another useful fact which hasn't been brought up yet is that Pakistan's credit rating is B-: https://tradingeconomics.com/pakistan/rating It doesn't say, but I think this credit rating is likely with respect to Pakistan's USD bonds. For larger issuers, agencies rate local currency bonds separately, ...
by bluquark
Sun Oct 20, 2019 4:40 pm
Forum: Investing - Theory, News & General
Topic: Is avoiding negative bond yields market timing?
Replies: 38
Views: 3229

Re: Is avoiding negative bond yields market timing?

What percentage of your total portfolio is EM Bonds? Will it make a meaningful difference to your end portfolio value? 10%. "Meaningful difference" is a criterion with some assumptions behind it that I don't agree with. The management burden of holding one extra fund in the same brokerage is really...
by bluquark
Sat Oct 19, 2019 10:33 pm
Forum: Personal Consumer Issues
Topic: GPS to stop working on older phones Nov 3?
Replies: 25
Views: 3342

Re: GPS to stop working on older phones Nov 3?

It's not a ploy. There's been lots written about this and an official DHS announcement, see e.g. https://www.theverge.com/2019/3/8/18255847/gps-week-rollover-issue-2019-garmin-tomtom-devices-affected I'd assume your GPS will probably stop working on Nov 3 as claimed. If you don't expect to need GPS ...
by bluquark
Sat Oct 19, 2019 10:18 pm
Forum: Investing - Theory, News & General
Topic: Help me think about Pakistani bond
Replies: 51
Views: 3917

Re: Help me think about Pakistani bond

Historically and in aggregate, external sovereign bonds have been good investments. Most of the time, you do get the appetizing face value of the bond, and defaults or unexpected inflation aren't frequent or severe enough to cause more than small haircuts, on average over long holding periods. But b...
by bluquark
Thu Oct 17, 2019 4:26 pm
Forum: Personal Investments
Topic: Getting up in age, too stock heavy
Replies: 33
Views: 4102

Re: Getting up in age, too stock heavy

If you change to SpecID cost basis, you'll likely find you can sell some reinvested dividends from the last 2 years without much tax to be paid, since the market hasn't gone anywhere recently. This won't amount to very much but it might nudge the AA to 60/40.
by bluquark
Thu Oct 17, 2019 1:58 pm
Forum: Investing - Theory, News & General
Topic: Schwab to allow fractional stock trading (WSJ)
Replies: 25
Views: 2598

Re: Schwab to allow fractional stock trading (WSJ)

Just allow market orders for a specific dollar amount. I wonder if this is what Schwab is planning to offer. If you still have to denominate orders in terms of share count, you would still have to mess with marketable limit orders to buy funds, which is a hassle especially while the market is closed.
by bluquark
Wed Oct 16, 2019 1:15 am
Forum: Personal Investments
Topic: How to handle 5M capital gain (post-IPO)
Replies: 102
Views: 8296

Re: How to handle 5M capital gain (post-IPO)

Are you planning to hold onto this individual stock all the way until you die and your child gets the step-up in basis? And are you further willing to assume estate tax law will even work the same way by then? If not, then you are going to pay at least the federal part of the tax sooner or later. 15...
by bluquark
Wed Oct 16, 2019 12:31 am
Forum: Investing - Theory, News & General
Topic: Vanguard now supports Yubikey 5 and 5C
Replies: 45
Views: 6692

Re: Vanguard now supports Yubikey 5 and 5C

I don't know why Vanguard even bothers to update a whitelist of security keys instead of just supporting anything plugged in that uses the protocol. Even the crappiest security key is ten times more secure than SMS.
by bluquark
Tue Oct 15, 2019 11:26 pm
Forum: Investing - Theory, News & General
Topic: Bank of America declares 'the end of the 60-40' standard portfolio
Replies: 63
Views: 11170

Re: Bank of America declares 'the end of the 60-40' standard portfolio

Based on historical returns, a 60% U.S. Stock / 40% U.S. Treasury portfolio having a decade of 0% real return would be somewhere in the bottom 10% of possible outcomes. We can add additional factors like CAPE valuation or Butter Production in Bangladesh to the model and pretend that adds precision,...
by bluquark
Tue Oct 15, 2019 11:02 pm
Forum: Personal Investments
Topic: GOVT vs BND [iShares US Treasury vs. Vanguard Total Bond Market]
Replies: 3
Views: 534

Re: GOVT vs BND

63% of BND is the same sort of US Treasury as GOVT. The rest is high-quality corporates that mostly behave the same (even in the 2008 crash they did OK). One big difference is GOVT has 0.12% higher expense ratio. I don't know what you're really getting for that cost, that's a pretty big proportion o...
by bluquark
Tue Oct 15, 2019 6:55 pm
Forum: Investing - Theory, News & General
Topic: Adjusting AA based on equity risk premium
Replies: 52
Views: 3502

Re: Adjusting AA based on equity risk premium

What have you been doing specifically OP? Nothing yet! I've been holding steady at a fixed AA (65/35) for some years now as I approach (early/semi) retirement. But it hasn't felt right to stick stubbornly to an AA that I ignorantly selected out of gut feel and conventional wisdom a decade ago. That...
by bluquark
Tue Oct 15, 2019 4:04 pm
Forum: Investing - Theory, News & General
Topic: Adjusting AA based on equity risk premium
Replies: 52
Views: 3502

Re: Adjusting AA based on equity risk premium

If the forecasted ERP drops, does that mean you should move more money into bonds, or that the market knows something that you don't? I personally subscribe to the theory that variations in ERP are not mainly about the market's function as a predictor, but rather due to changes in the average of th...
by bluquark
Tue Oct 15, 2019 1:59 pm
Forum: Investing - Theory, News & General
Topic: Adjusting AA based on equity risk premium
Replies: 52
Views: 3502

Re: Adjusting AA based on equity risk premium

Whether you think valuations give any indication to the ERP is an excellent question. In an abstract sense, they have to by definition. If all external business reality is identical and you can buy a stock for 20% cheaper, then ERP is higher, just like bond valuations move inversely to bond yields....
by bluquark
Mon Oct 14, 2019 7:40 pm
Forum: Investing - Theory, News & General
Topic: Adjusting AA based on equity risk premium
Replies: 52
Views: 3502

Re: Adjusting AA based on equity risk premium

It sounds like this depends on how "success" is defined. If the goal is to outperform a 100% stock portfolio in terms of expected return after 30 years of a single lump sum, then any strategy involving bonds/cash fails in theory in an efficient market and fails in practice for most active managers. ...
by bluquark
Sun Oct 13, 2019 4:15 pm
Forum: Personal Investments
Topic: Exchange vs. Sell
Replies: 7
Views: 584

Re: Exchange vs. Sell

Selling a mutual fund is just a specific kind of exchange: into your settlement fund (Federal Money Market if this is Vanguard) Yes, you can sell or exchange portions; assuming these are not ETFs, you can even sell or exchange fractions of shares (which is why mutual fund transactions are usually sp...
by bluquark
Sun Oct 13, 2019 1:09 am
Forum: Investing - Theory, News & General
Topic: Adjusting AA based on equity risk premium
Replies: 52
Views: 3502

Adjusting AA based on equity risk premium

The idea of buying more bonds during a bubble and buying more stocks after a crash is common sense, but I've yet to see a Boglehead strategy that fully incorporates it. "Rebalancing to AA does that automatically" is the usual answer, but wouldn't it be even more sensible to, say, adjust AA within a ...
by bluquark
Sat Oct 12, 2019 5:36 pm
Forum: Personal Investments
Topic: Municipal Bond Now vs In Retirement?
Replies: 12
Views: 996

Re: Municipal Bond Now vs In Retirement?

The capital gains potential for bonds is unpredictable, may be nil and is never going to be in the same league as stocks. The sort of rise we just saw this year doesn't come along often. So I would not overthink this and just go with the type of bond that provides higher yield.
by bluquark
Sat Oct 12, 2019 1:19 am
Forum: Non-US Investing
Topic: Why emerging market bonds?
Replies: 37
Views: 3233

Re: Why emerging market bonds?

I hold about 1/3 of my fixed income (10% of my total portfolio) in local currency EM bonds, in addition to a world market cap equity portfolio holding the usual amount of EM stock. My perspective: - It appears to have about half the risk and return of equity. The equity risk premium is currently est...
by bluquark
Fri Oct 11, 2019 11:14 pm
Forum: Personal Investments
Topic: Receiving gift of stock - the mechanics
Replies: 8
Views: 566

Re: Receiving gift of stock - the mechanics

Using your existing Vanguard account sounds like a good plan to me, assuming it's a brokerage account and not one of the legacy mutual-fund-only accounts. Although people sometimes unfavorably compare Vanguard's trading capabilities to frequent-trading-focused brokerages, it works just fine for simp...
by bluquark
Fri Oct 11, 2019 8:46 pm
Forum: Investing - Theory, News & General
Topic: Anyone buying PG&E stock?
Replies: 42
Views: 3161

Re: Anyone buying PG&E stock?

I bought etrade after it dropped ~17% when Schwab announced zero commissions a little bit ago. It's now up 10%. Buying stock after a precipitous fall can be lucrative if you have reason to believe the market over-reacted and that the company is fundamentally sound. Don't know about PG&E though. Buy...
by bluquark
Thu Oct 10, 2019 9:27 pm
Forum: Investing - Theory, News & General
Topic: Do You Think Vanguard Will Join The No Commission Party?
Replies: 40
Views: 4217

Re: Do You Think Vanguard Will Join The No Commission Party?

I think they'll join because it makes them look bad at first glance and will turn into a talking-point reason not to use Vanguard. Even though individual stocks and non-Vanguard ETFs aren't part of the Vanguard philosophy, I predict they will cave.
by bluquark
Thu Oct 10, 2019 8:58 pm
Forum: Personal Investments
Topic: Sell Vanguard New York Long-Term Tax-Exempt Fund when move out of NY?
Replies: 17
Views: 862

Re: Sell Vanguard New York Long-Term Tax-Exempt Fund when move out of NY?

Yes, it is an easy equation if the funds had the exact same duration. I can than take the difference, multiply by the total and divide the cap gains amount by that amount to get the break even point. But the two funds mentioned have slightly different durations. So, wasn't sure how to factor that i...
by bluquark
Thu Oct 10, 2019 4:35 pm
Forum: Personal Investments
Topic: Sell Vanguard New York Long-Term Tax-Exempt Fund when move out of NY?
Replies: 17
Views: 862

Re: Sell Vanguard New York Long-Term Tax-Exempt Fund when move out of NY?

Using the NY Long-Term Tax-Exempt fund will probably earn slightly less interest compared to a comparable Tax-exempt fund that is not NY specific. I guess I'm weighing that lost income vs the capital gains tax on $17K. I imagine hard to compute the break-even point between the options. My gut is to...
by bluquark
Sat Oct 05, 2019 2:07 am
Forum: Personal Finance (Not Investing)
Topic: Tax guy my mom hired has me paying suspiciously high tax on investments
Replies: 46
Views: 6370

Re: Tax guy my mom hired has me paying suspiciously high tax on investments

I don't know that much about trusts, but for directly held funds, you pay capital gains tax if you -- or the funds acting on your behalf -- sell/rebalance appreciated assets over the year, and you don't pay them if you didn't. There's no choice to make at tax return time. I suggest investigating wha...
by bluquark
Sat Oct 05, 2019 1:50 am
Forum: Personal Investments
Topic: Investing in tax exempt bonds over paying down mortgage?
Replies: 12
Views: 758

Re: Investing in tax exempt bonds over paying down mortgage?

VTEB's SEC yield is 1.72%, not 3%. (At your tax rate, munis or Total Bond is pretty much a wash.) Also, inflation has been hovering around 1.5%. The idea of "better investment options" arising, or buying more stocks in a crash, both cut against Boglehead "stay the course" principles, so it's unclear...
by bluquark
Sat Oct 05, 2019 1:23 am
Forum: Investing - Theory, News & General
Topic: Know when to hold them and when to fold them......
Replies: 148
Views: 13183

Re: Know when to hold them and when to fold them......

Hmm yeah, on second thought, I must have interpreted the South African example wrong. If returns were great but the market cap stagnated, that reminds me of a company with no future that pays out good dividends as its customer base shrinks, instead of making any attempt at investing in its future. I...
by bluquark
Fri Oct 04, 2019 11:07 pm
Forum: Investing - Theory, News & General
Topic: Know when to hold them and when to fold them......
Replies: 148
Views: 13183

Re: Know when to hold them and when to fold them......

To demonstrate the same outperformance relative to international over the next century, the US share of the total world stock market would have to climb from 53% to ~85%, and the entire rest of the world would have to fall to just 15%. This doesn't seem likely to me. Returns and stock market size a...
by bluquark
Fri Oct 04, 2019 8:43 pm
Forum: Investing - Theory, News & General
Topic: 'Stay the course' with international stock but give up on value?
Replies: 101
Views: 6539

Re: 'Stay the course' with international stock but give up on value?

Of course, most attacks on factors are statistically illiterate and full of fallacies, but the majority of critics' arguments being weak does not prove that a case is strong. The factor papers I've read convinced me they definitely identified real effects (especially the applicability to multiple in...
by bluquark
Fri Oct 04, 2019 7:49 pm
Forum: Investing - Theory, News & General
Topic: 'Stay the course' with international stock but give up on value?
Replies: 101
Views: 6539

Re: 'Stay the course' with international stock but give up on value?

Bad analogy. Physical forces like thrust and drag, with a sufficient understanding of the physics, give a fully predictive model of the result. Physical laws are testable and results are precisely repeatable (on the macroscopic scale anyway, let's not get into quantum mechanics here). I can use a p...
by bluquark
Fri Oct 04, 2019 6:51 pm
Forum: Investing - Theory, News & General
Topic: 'Stay the course' with international stock but give up on value?
Replies: 101
Views: 6539

Re: 'Stay the course' with international stock but give up on value?

Factors aren't mystical forces and aren't (I think) difficult to understand. Just as you'd use thrust, drag, and torque to predict the movement of an object in physical space you'd use factors like market, size, value, and quality to predict an asset's returns relative to other assets. Bad analogy....
by bluquark
Fri Oct 04, 2019 5:56 pm
Forum: Investing - Theory, News & General
Topic: 'Stay the course' with international stock but give up on value?
Replies: 101
Views: 6539

Re: 'Stay the course' with international stock but give up on value?

Just like pro-international crowd, don't seem to advocate the market weight of Stocks to Bonds that the Global capital markets collectively hold. Why is 55/45 magical when 70/30 is not? Because market allocation of equity vs bonds is based almost purely on collective risk preferences (desire for st...
by bluquark
Fri Oct 04, 2019 1:02 am
Forum: Personal Investments
Topic: Stellar Bond Fund Returns - What does this mean?
Replies: 13
Views: 1196

Re: Stellar Bond Fund Returns - What does this mean?

The way I like to think of the capital appreciation we saw this year is that the intermediate-term bond funds effectively "paid out early" a chunk of the next ~6 years of yield that was expected. Long-term bond funds skyrocketed because they "paid out early" ~20 years of yield instead.
by bluquark
Thu Oct 03, 2019 9:15 pm
Forum: Personal Investments
Topic: Currently invested in 100% stock
Replies: 130
Views: 13310

Re: Currently invested in 100% stock

One exercise I've found useful in evaluating AA is considering how much, this year, I'm (statistically) missing out on by holding bonds. The equity risk premium is currently modeled to be around 4%. So if e.g. considering a 20% more aggressive AA, you can multiply your portfolio total by 20% * 4% = ...
by bluquark
Tue Oct 01, 2019 7:25 pm
Forum: Personal Finance (Not Investing)
Topic: IT compensation comparison
Replies: 259
Views: 21835

Re: IT compensation comparison

I remember in the mid 2000s, one manager in my team said basically told me exact same words, i.e. software engineering is a dead end job. And that I should get out . I am glad I didn't follow his advice. But the point is that back then, his advice sounded very wise. All the world was predicting tha...
by bluquark
Tue Oct 01, 2019 7:06 pm
Forum: Investing - Theory, News & General
Topic: Where is benefit of diversification? (SP 500 vs Total Stock)
Replies: 15
Views: 1407

Re: Where is benefit of diversification? (SP 500 vs Total Stock)

2. If there is no added advantage, then why not go with simplicity of S&P 500 , after all simplicity is also advocated as a BH principle. And not worry over small-cap, micro-cap, etc (there is a whole wiki on how to approximate the total stock market and discussions around the %s). VTSAX is simpler...
by bluquark
Tue Oct 01, 2019 6:48 pm
Forum: Personal Investments
Topic: Considering switch from Vanguard to eTrade...pros, cons and other input?
Replies: 53
Views: 3948

Re: Considering switch from Vanguard to eTrade...pros, cons and other input?

My main qualm with a potential move to eTrade is how long they will last as an independent broker. They won't fail but they may get absorbed/merged by another brokerage at some point and then there could be a lot of changes. Agreed. OP, the main thing that got you frustrated with Vanguard is that y...
by bluquark
Fri Sep 27, 2019 3:11 pm
Forum: Personal Investments
Topic: My Portfolio
Replies: 15
Views: 868

Re: My Portfolio

For a portfolio with this much fixed income, I'd suggest using TIPS. For instance, VTAPX.

I don't understand what this 5.3% number is supposed to be either. Obviously the returns (even in nominal terms) are going to be lower than that.
by bluquark
Thu Sep 26, 2019 12:19 am
Forum: Personal Investments
Topic: Sector Diversification
Replies: 8
Views: 497

Re: Sector Diversification

You can short a tech ETF. I might suggest FDN, which seems especially concentrated on Silicon Valley companies. Your corporate policy probably bans you from shorting or buying derivatives against your own company, anyway. Shorting an ETF containing your company might be a gray area, you should check...
by bluquark
Wed Sep 25, 2019 10:16 pm
Forum: Investing - Theory, News & General
Topic: The Zeno's Paradox of investing: the buy-and-hold arrow that flies without moving
Replies: 31
Views: 2870

Re: The Zeno's Paradox of investing: the buy-and-hold arrow that flies without moving

The main reason the long-term-holding advice is given is that most investors keep with a strategy until it has a spell of underperformance, and then "just so happen" to consider different strategies then. Their meta-investment-strategy is almost specifically designed to wring out the poorest returns...
by bluquark
Wed Sep 25, 2019 7:13 pm
Forum: Personal Investments
Topic: VTIAX International fund - should I give up on it?
Replies: 297
Views: 26002

Re: VTIAX International fund - should I give up on it?

Valuations and fundamentals models take both current earnings as well as future earnings growth. More precisely, they typically project the currently seen earnings growth curve (and growth-of-growth curve) as though it was going to continue into the future. That sort of model is unable to correctly...
by bluquark
Wed Sep 25, 2019 5:00 pm
Forum: Personal Investments
Topic: VTIAX International fund - should I give up on it?
Replies: 297
Views: 26002

Re: VTIAX International fund - should I give up on it?

I think the stock/bond AA connection is onto something, but my line of thinking goes somewhere different with it. Modern research is increasingly pointing to the idea that the investor population's "desire to take risk" drives the equity risk premium, rather than predictions about the future: https:...
by bluquark
Wed Sep 25, 2019 1:22 pm
Forum: Personal Investments
Topic: Should I buy I-bonds when I'm >30 years from retirement?
Replies: 50
Views: 4349

Re: Should I buy I-bonds when I'm >30 years from retirement?

They're protected from inflation risk, term risk, and reinvestment risk. Yes i-bonds are low risk, but you haven't explained why I can't achieve lower risk by just adjusting my existing AA instead. The state tax deferral is nice, but since returns are so low it doesn't add up to much. Long-term TIP...
by bluquark
Tue Sep 24, 2019 6:11 pm
Forum: Personal Investments
Topic: Should I buy I-bonds when I'm >30 years from retirement?
Replies: 50
Views: 4349

Re: Should I buy I-bonds when I'm >30 years from retirement?

I really don't see the point of i-bonds. I understand their purpose as a stable investment, but why mess with another investment when you can already adjust your risk via indexed stock/bond AA. They're more stable than any other bond. They're protected from inflation risk, term risk, and reinvestme...
by bluquark
Tue Sep 24, 2019 5:52 pm
Forum: Personal Investments
Topic: Emergency Fund Building vs. 401k Contributions
Replies: 19
Views: 1228

Re: Emergency Fund Building vs. 401k Contributions

Desired International allocation: 10-15% of stocks I expect the international to even out over time as I now have 20% of new contributions to my 401k going to FSPSX. You can convert amounts from one to the other at any time with no penalty, as these are tax-advantaged accounts. 20% in international...
by bluquark
Tue Sep 24, 2019 1:59 pm
Forum: Personal Finance (Not Investing)
Topic: Vanguard alert [Unclaimed property notice]
Replies: 99
Views: 15054

Re: Vanguard alert [Unclaimed property notice]

It sounds like Vanguard might have a bug in their system causing these banners to appear right now, since two posters have seen it in the last month for no very good reason. Not terribly reassuring...
by bluquark
Mon Sep 23, 2019 8:25 pm
Forum: Personal Finance (Not Investing)
Topic: How does a bank make money off you? How to ensure they don't
Replies: 69
Views: 7866

Re: How does a bank make money off you? How to ensure they don't

Sometimes---frequently----the "game" is to get your assets into the institution, no matter whether they are initially making money off of you are not-----and then work at selling you/transferring you into more profitable products. Fidelity does this by touting their low cost, sometimes even subsidi...
by bluquark
Mon Sep 23, 2019 8:20 pm
Forum: Personal Finance (Not Investing)
Topic: Bank of America Cash Rewards Visa Signature as Alternative to Citi Double Cash Card?
Replies: 18
Views: 1991

Re: Bank of America Cash Rewards Visa Signature as Alternative to Citi Double Cash Card?

Alliant offers 2.5% cash back for the same $95 annual fee without having to jump through any tier hoops. Sounds like a good alternative. I don't especially regret going out of my way to jump tier hoops though, especially as I got two signup bonuses out of the process (for the brokerage and for the ...
by bluquark
Mon Sep 23, 2019 8:08 pm
Forum: Personal Investments
Topic: Replicating Total International in most tax-efficient way
Replies: 5
Views: 357

Re: Replicating Total International in most tax-efficient way

Personally, I split Total International into four: Pacific, Europe, Emerging, and Canada (I use Vanguard's funds for the first three and BBCA for Canada). I check the Vanguard region breakdown for the Total World fund to know what percentage to hold them in. The main reason I do that is in order to ...