Search found 9284 matches

by Kevin M
Fri May 25, 2018 9:16 pm
Forum: Investing - Theory, News & General
Topic: US T bills - first time user
Replies: 55
Views: 3732

Re: US T bills - first time user

Thanks again Kevin. As the final chapter to this, what yield would I actually earn on this transaction? Using my numbers (even though it is now a hypothetical example), on 5/31/2019 I will have effectively received 3 coupon payments of $75 + $10K return of principal equals $10,225. I paid out $9995...
by Kevin M
Fri May 25, 2018 7:47 pm
Forum: Personal Consumer Issues
Topic: Tesla Autopilot, worth it?
Replies: 35
Views: 2456

Re: Tesla Autopilot, worth it?

Wow, that would be a disaster if you attempted to "park" in that situation. Sure, but who would do that??? I've seen this a number of times, and I just chuckle. It does show that there is a certain context we have when driving that goes beyond the mere placement and current movement of vehicles. Th...
by Kevin M
Fri May 25, 2018 7:38 pm
Forum: Investing - Theory, News & General
Topic: US T bills - first time user
Replies: 55
Views: 3732

Re: US T bills - first time user

Thanks again Kevin. As the final chapter to this, what yield would I actually earn on this transaction? Using my numbers (even though it is now a hypothetical example), on 5/31/2019 I will have effectively received 3 coupon payments of $75 + $10K return of principal equals $10,225. I paid out $9995...
by Kevin M
Fri May 25, 2018 7:33 pm
Forum: Investing - Theory, News & General
Topic: US T bills - first time user
Replies: 55
Views: 3732

Re: US T bills - first time user

Thanks again Kevin. As the final chapter to this, what yield would I actually earn on this transaction? Using my numbers (even though it is now a hypothetical example), on 5/31/2019 I will have effectively received 3 coupon payments of $75 + $10K return of principal equals $10,225. I paid out $9995...
by Kevin M
Fri May 25, 2018 7:21 pm
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

Do you think this is a wise strategy? I think you are more willing to work for these deals than I am at this point. As I recall, you got in on the last 4% 5-year CD deal that came around, which required joining another credit union, doing an early withdrawal, and doing the IRA transfer. I was too l...
by Kevin M
Fri May 25, 2018 7:08 pm
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

kevin, researching new issues at Vanguard and Schwab for the past 2 weeks. Did you get those at Fido or Vanguard? Which ones? What size were the "lots". (still trying to grasp that concept). thanks, jim With new issues there's really not much to research. Both Vanguard and Fidelity show the top rat...
by Kevin M
Fri May 25, 2018 9:29 am
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

Great! Thanks for the details, Kevin! Perhaps with your permission I will copy this record and email it to them if they tell me the same thing again. (not mentioning you by name of course). First ask to talk to IRA specialist--maybe ask if the person I named still works there, and if you can talk t...
by Kevin M
Fri May 25, 2018 9:26 am
Forum: Investing - Theory, News & General
Topic: US T bills - first time user
Replies: 55
Views: 3732

Re: US T bills - first time user

<snip> ... leavening the portfolio by purchasing 2 year notes, which, last I checked, were yielding 2.52%. Yes, 2-year Treasury about 2.48% today for large quantities, so a bit less for smaller quantities. But, 2-year CD is 2.80%, so more than 30 basis points higher. Big spike in the CD yield curve...
by Kevin M
Thu May 24, 2018 9:21 pm
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

This is also the info I received! The only catch is that their disclosure agreement specifies that allowing premature withdrawals is at the bank's discretion. Yes, this is pretty standard language. Today there was not even a second of hesitation on the rep's part about doing an early withdrawal. Of...
by Kevin M
Thu May 24, 2018 9:17 pm
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

I don't know how you managed to do a direct transfer into an IRA at Achieva if you did not have one before. I am now a member and I went online to see if I could open an IRA. There are no links to open any accounts that I could find on their website...no links to forms either. I logged in and only ...
by Kevin M
Thu May 24, 2018 7:42 pm
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

Happy to see that Achieva has already closed out my two CDs at 2.71% APY and opened the one at 4.2% APY. That was fast and easy.

Kevin
by Kevin M
Thu May 24, 2018 7:37 pm
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

One catch is that they cannot open the certificate until the funds are available in your core account at Achieva, so you need to do a rollover into a non-IRA account at Achieva, and then move the money into the IRA certificate. I would double-check this. I know for a fact I did not do this, as I ha...
by Kevin M
Thu May 24, 2018 4:12 pm
Forum: Investing - Theory, News & General
Topic: US T bills - first time user
Replies: 55
Views: 3732

Re: US T bills - first time user

Thanks very much Kevin. Just to finalize the details of this example…This bond has 1.5 coupon and matures on 5/31/2019. OK, I see this. I see price 99.230 for minimum quantity 25, so as of now, you can't get this price for 10. I enter a trial order for 25, and I see on the preview screen that accru...
by Kevin M
Thu May 24, 2018 3:51 pm
Forum: Investing - Theory, News & General
Topic: Help me understand zero coupon bonds
Replies: 11
Views: 723

Re: Help me understand zero coupon bonds

This is new territory for me. Fidelity is offering zero coupon treasuries maturing in 6 months at 2.09%. Looks like you are looking at the auction expected yield. This is not for sure what you'll get. The auction closes 5/29, so next Tuesday, so the yield will depend on the low-price (high-yield) b...
by Kevin M
Thu May 24, 2018 3:13 pm
Forum: Investing - Theory, News & General
Topic: Fact, Fiction, and the Size Effect
Replies: 78
Views: 4926

Re: Fact, Fiction, and the Size Effect

So, Robert T, are you making any changes to your investment policy based on this research, and why or why not?

Kevin
by Kevin M
Thu May 24, 2018 2:53 pm
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

What are the membership requirements for Achieva if you don't live in Florida? It looks like there is still an easy membership option. Go to https://www.achievacu.com/Home/Membership/. Leave the county selection blank, and choose "No" for are you related to a current member (unless you are, then of...
by Kevin M
Thu May 24, 2018 2:46 pm
Forum: Investing - Theory, News & General
Topic: US T bills - first time user
Replies: 55
Views: 3732

Re: US T bills - first time user

Some additional clarification might be useful to those unfamiliar with the way bond prices are quoted. Prices are quoted as a percentage of par value (par value = 100% of face value), but as mentioned already, one bond is face value of $1,000. So if you see a price quote of 99.5, it means that the b...
by Kevin M
Thu May 24, 2018 1:40 pm
Forum: Investing - Theory, News & General
Topic: US T bills - first time user
Replies: 55
Views: 3732

Re: US T bills - first time user

Finally, as already mentioned, you need to click the depth of book icon to find yields for the quantity you are interested in. So first pick maturity of interest, then click depth of book, then find highest yield with minimum quantity less than or equal to how many you want to buy. You can then cli...
by Kevin M
Thu May 24, 2018 1:36 pm
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

Achieva FCU in Florida is offering 5 year CD within an IRA at 4.2% APY with a minimum of $75k. Thank you Kevin. Detail provided greatly appreciated. You are very welcome, but I want to also thank you for bringing this to our (my) attention. This turned out to be an exceptional deal for me--better t...
by Kevin M
Thu May 24, 2018 12:07 pm
Forum: Investing - Theory, News & General
Topic: US T bills - first time user
Replies: 55
Views: 3732

Re: US T bills - first time user

I'm a little confused about purchasing treasuries at Fidelity. Here's a listing of 1-year tbills: https://i.imgur.com/rYuyzJK.png Under Qty(min) column, the minimum quantity is listed in the hundreds (200 to 500). Since my understanding is that a quantity of 1 represents $1000, I'm hoping this does...
by Kevin M
Wed May 23, 2018 10:39 pm
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

Here are my rough calculations on the net yield this would be for me if I broke my 2.7% CD, assuming EWP of six months of interest = 1.35%. Net interest rate for first year is 4.2% - 1.35% = 2.85%, then for next four years I earn 4.2%. So for the 5-year period, net yield is: ( (1+2.85%) * (1+4.2%)^4...
by Kevin M
Wed May 23, 2018 9:44 pm
Forum: Investing - Theory, News & General
Topic: 2-year CDs at Vanguard and Fidelity Today
Replies: 206
Views: 28041

Re: 2-year CDs at Vanguard and Fidelity Today

I did some more work, trying to see if I could work out the yield to worst assuming different call dates, and using the spreadsheet XIRR function. I couldn't think of an easier way to do it, since the coupon rate changes. The closest I could come was an IRR of 3.03% if called on 5/20/2020, so a coup...
by Kevin M
Wed May 23, 2018 7:35 pm
Forum: Investing - Theory, News & General
Topic: 2-year CDs at Vanguard and Fidelity Today
Replies: 206
Views: 28041

Re: 2-year CDs at Vanguard and Fidelity Today

CUSIP 48125YZ98 Here's what I see when I search for this CUSIP at Vanguard. There are 10 available with minimum quantity 1. Coupon is 1.25%, and ask price is 96.857. Maturity date is 5/20/21, so basically a 3-year CD. Yield to maturity is 3.332% and yield to worst is 3.011%. The fact that YTW is lo...
by Kevin M
Wed May 23, 2018 6:43 pm
Forum: Personal Consumer Issues
Topic: Tesla Autopilot, worth it?
Replies: 35
Views: 2456

Re: Tesla Autopilot, worth it?

MotoTrojan wrote:
Wed May 23, 2018 10:57 am
Add it later on. It’ll extend that new car feeling. It’s just a software change.
A software change plus $1,000 more than if you get it when you buy.

Kevin
by Kevin M
Wed May 23, 2018 6:41 pm
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

Not wanting to hijack but I see you are active on this thread and you see seem to be the go to person on this topic Achieva FCU in Florida is offering 5 year CD within an IRA at 4.2% APY with a minimum of $75k. Becoming a member is reasonably easy and inexpensive. I do not know what the EWP is but ...
by Kevin M
Tue May 22, 2018 11:28 pm
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

Lower bid ask spreads only matter if you sell before maturity. Comparable or higher TEY in taxable is my bigger reason.

At any rate, staying short term is consistent with your outlook.
by Kevin M
Tue May 22, 2018 7:18 pm
Forum: Investing - Theory, News & General
Topic: 2-year CDs at Vanguard and Fidelity Today
Replies: 206
Views: 28041

Re: 2-year CDs at Vanguard and Fidelity Today

Is a multi-step coupon (CD) just a step up CD (different yields for later time periods)? I always thought the owner controlled if and when the step up occurred and I'm not sure how that would work with a secondary CD through Vanguard. Would the yield Vanguard shows take that all into account? Thank...
by Kevin M
Tue May 22, 2018 6:33 pm
Forum: Investing - Theory, News & General
Topic: Do I understand duration correctly?
Replies: 33
Views: 2434

Re: Do I understand duration correctly?

The graph may be misleading, but in the opposite way you state. The bond yields represent returns for the subsequent 1 or 3 year periods, while the inflation line is for the previous year. So the real yield of the bond is relative to the CPI change a year later--even better than just eyeballing the ...
by Kevin M
Tue May 22, 2018 11:31 am
Forum: Investing - Theory, News & General
Topic: Do I understand duration correctly?
Replies: 33
Views: 2434

Re: Do I understand duration correctly?

Note a rolling investment in short instruments does not work because you can't predict the available yield at reinvestment. Although technically this is correct if you really want to match the duration of the bond to the duration of the liability (nominal or real), historically rolling short-term b...
by Kevin M
Tue May 22, 2018 10:14 am
Forum: Investing - Theory, News & General
Topic: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch
Replies: 37
Views: 4446

Re: 5 yr CD up to 3.41% APY, NO EWP for seniors in IRA, but with catch

I don't believe that past history necessarily has predictive value, but there is some potential rational explanation for such a pattern when it comes to Treasury yields, and if the pattern is real it does seem like some time soon the trend is due for a reversal with rising rates. That sometime may ...
by Kevin M
Mon May 21, 2018 9:32 pm
Forum: Investing - Theory, News & General
Topic: Do I understand duration correctly?
Replies: 33
Views: 2434

Re: Do I understand duration correctly?

Note a rolling investment in short instruments does not work because you can't predict the available yield at reinvestment. Although technically this is correct if you really want to match the duration of the bond to the duration of the liability (nominal or real), historically rolling short-term b...
by Kevin M
Mon May 21, 2018 8:30 pm
Forum: Investing - Theory, News & General
Topic: Bond Yields and Federal Funds Rate
Replies: 30
Views: 2437

Re: Bond Yields and Federal Funds Rate

For example, if I use the most recent 1-year and 2-year CMT yields of 2.32% and 2.55%, solving for Yf1n in the above equation for n=2 indicates that the 1-year yield would have to increase to 2.78% in one year for the return of holding a 2-year Treasury to maturity to equal the return of rolling 1-...
by Kevin M
Mon May 21, 2018 7:24 pm
Forum: Personal Consumer Issues
Topic: Tesla Autopilot, worth it?
Replies: 35
Views: 2456

Re: Tesla Autopilot, worth it?

Personally, I would not buy a Tesla without it. I've been using AP1 on Model S since December 2015, and have loved it. Have been using AP2 on a newer Tesla since December 2017, and I'd say it's on par with AP1 if not a bit better after an update a month or two ago. And it keeps getting better. For m...
by Kevin M
Mon May 21, 2018 5:00 pm
Forum: Investing - Help with Personal Investments
Topic: Vangaurd Municipal Money Market VMSXX 1.39%
Replies: 76
Views: 7293

Re: Vangaurd Municipal Money Market VMSXX 1.39%

Similar conclusion by simply looking at YTD returns: Prime MM 0.61%, Muni MM = 0.46% = 0.61% * (1-24%).

Kevin
by Kevin M
Mon May 21, 2018 4:53 pm
Forum: Investing - Help with Personal Investments
Topic: Vangaurd Municipal Money Market VMSXX 1.39%
Replies: 76
Views: 7293

Re: Vangaurd Municipal Money Market VMSXX 1.39%

I compared the past 3 months. The Muni MM returned 23.8% less than Prime. So a toss up for those in the 24% bracket, not worth it for those under, but worth it for those over. I calculated averages from 12/15/2017 through 5/18/2018, choosing the start date as when the first big upswing of the previ...
by Kevin M
Mon May 21, 2018 2:19 pm
Forum: Investing - Help with Personal Investments
Topic: Vangaurd Municipal Money Market VMSXX 1.39%
Replies: 76
Views: 7293

Re: Vangaurd Municipal Money Market VMSXX 1.39%

Any easy way to adjust for the cyclical effect so I can see if it's worth it? You'd think this would be a published number. There's no way to compare without it. I kind of addressed this in this post earlier in the thread: https://www.bogleheads.org/forum/viewtopic.php?f=1&t=246263#p3935760. This s...
by Kevin M
Mon May 21, 2018 2:11 pm
Forum: Investing - Theory, News & General
Topic: Bond Yields and Federal Funds Rate
Replies: 30
Views: 2437

Re: Bond Yields and Federal Funds Rate

To add to this, the Federal Reserve themselves say that the Federal Funds Rate does not drive longer term bond yields & interest rates anymore. They've written dozens, maybe hundreds by now!, papers and blogs about it. If you search for "Greenspan conundrum" on some of the local Federal Reserve web...
by Kevin M
Mon May 21, 2018 10:26 am
Forum: Investing - Help with Personal Investments
Topic: Ally No Penalty CD @1.75% vs VMMXX @ 1.87%
Replies: 26
Views: 3240

Re: Ally No Penalty CD @1.75% vs VMMXX @ 1.87%

Interesting, I did not know funds transferred into Prime MM are subject to 7-10 day hold even when used to buy other mutual funds.. To clarify, you can use cash transferred into a money market fund from an external bank to buy shares of another mutual fund immediately , just as you could have bough...
by Kevin M
Sun May 20, 2018 8:08 pm
Forum: Investing - Help with Personal Investments
Topic: Ally No Penalty CD @1.75% vs VMMXX @ 1.87%
Replies: 26
Views: 3240

Re: Ally No Penalty CD @1.75% vs VMMXX @ 1.87%

There should be no debate about the ER--SEC yield is net of ER--period. Anyone who says or thinks otherwise just doesn't understand SEC yield. You can actually prove that for yourself if you want. I describe money market SEC yield in more detail in this post, and in a subsequent post show you can ca...
by Kevin M
Sun May 20, 2018 7:50 pm
Forum: Investing - Theory, News & General
Topic: CDs in Vanguard IRA
Replies: 2
Views: 403

Re: CDs in Vanguard IRA

If you're planning on having CDs be a large part of your portfolio, I'd consider Fidelity too. I usually find better CD rates at Fidelity on the secondary market, and sometimes even their new-issue rates seem to increase a little before Vanguard. Fidelity also has excellent customer service, and we ...
by Kevin M
Sun May 20, 2018 7:41 pm
Forum: Investing - Theory, News & General
Topic: Bank Interest Rates — when will they go up?
Replies: 25
Views: 2782

Re: Bank Interest Rates — when will they go up?

travelogue wrote:
Sun May 20, 2018 5:08 pm
Thanks for the perspective and information, everyone! I’ve been watching the equity markets react to rate changes and was just wondering when other rates might move as well.
I think we've shown that many of them have been moving.

Kevin
by Kevin M
Sun May 20, 2018 7:39 pm
Forum: Investing - Help with Personal Investments
Topic: Vangaurd Municipal Money Market VMSXX 1.39%
Replies: 76
Views: 7293

Re: Vangaurd Municipal Money Market VMSXX 1.39%

Still puzzling to me is why the CA mm yield (and presumably national muni?) is going down, whereas the Prime mm and other rates are going up. I am not aware of any adverse muni news that cause the muni market to change so much in the opposite direction. Anyone has a guess? If you review the thread,...
by Kevin M
Sun May 20, 2018 7:36 pm
Forum: Investing - Help with Personal Investments
Topic: Vangaurd Municipal Money Market VMSXX 1.39%
Replies: 76
Views: 7293

Re: Vangaurd Municipal Money Market VMSXX 1.39%

This may be a silly question but I am planning to swap my VMSXX to the Prime Market Fund, do I lose the accumulated interest for the month? I bought VMSXX on 5/2. I would almost certainly think I would get the interest since that is earned by me but who knows sometimes some of these rules are nonse...
by Kevin M
Sun May 20, 2018 7:32 pm
Forum: Investing - Theory, News & General
Topic: Bond Yields and Federal Funds Rate
Replies: 30
Views: 2437

Re: Bond Yields and Federal Funds Rate

My understanding of the EH is more about it explaining the shape of the yield curve based on expectations of future short term rates, as opposed to being good at predicting future short term rates. I'd think that the failure to accurately predict future rates is an explanation for liquidity preferen...
by Kevin M
Sun May 20, 2018 4:11 pm
Forum: Investing - Theory, News & General
Topic: Challenge: guess the effect of rebalancing (by interval or bands) in 2008-2009
Replies: 35
Views: 3620

Re: Challenge: guess the effect of rebalancing (by interval or bands) in 2008-2009

I always like to take another look when dollar differences seem small when looking at relatively small dollar amounts. If you scale it up by 100, so starting with $1,000,000 instead of $10,000, the difference between annual rebalancing and monthly rebalancing would have been $21,900 (in favor of ann...
by Kevin M
Sun May 20, 2018 3:54 pm
Forum: Investing - Help with Personal Investments
Topic: Vangaurd Municipal Money Market VMSXX 1.39%
Replies: 76
Views: 7293

Re: Vangaurd Municipal Money Market VMSXX 1.39%

If you want to take the time, you can actually figure out what your yield was yesterday--not averaged over previous seven days. In doing so, I calculate that the yield of CA muni MM dropped from 1.28% on 5/12 to 1.17% on 5/19 (yesterday). This equates to a drop in TEY for me of 1.97% to 1.80%, and t...
by Kevin M
Sun May 20, 2018 2:17 pm
Forum: Investing - Help with Personal Investments
Topic: Vangaurd Municipal Money Market VMSXX 1.39%
Replies: 76
Views: 7293

Re: Vangaurd Municipal Money Market VMSXX 1.39%

Practically speaking, using the daily SEC yield to calculate the TEY for comparison with other investments might not be the best. As some have experiences (myself included), at peaks it gives a false impression that the muni MM is much much better than other investments. So what is a better way to ...
by Kevin M
Sun May 20, 2018 12:28 pm
Forum: Investing - Theory, News & General
Topic: Bond Yields and Federal Funds Rate
Replies: 30
Views: 2437

Re: Bond Yields and Federal Funds Rate

I always appreciate your insights, lack_ey, but the following statements seem somewhat contradictory: To clarify, I mean that the expectations hypothesis is a very bad model for bond yields and that the shape of the yield curve is not generally indicative of the direction of future short rates (whic...
by Kevin M
Sat May 19, 2018 10:19 pm
Forum: Investing - Help with Personal Investments
Topic: Vangaurd Municipal Money Market VMSXX 1.39%
Replies: 76
Views: 7293

Re: Vangaurd Municipal Money Market VMSXX 1.39%

Here I zoomed in on 1995-2000:

Image

I do see lots of peaks at or near the quarter boundaries.

Kevin
by Kevin M
Sat May 19, 2018 10:05 pm
Forum: Investing - Theory, News & General
Topic: Bond Yields and Federal Funds Rate
Replies: 30
Views: 2437

Re: Bond Yields and Federal Funds Rate

It doesn't do it justice to call the empirical evidence in support of the expectations hypothesis "weak" when IIRC over some period I checked, it actually predicted future rate changes so badly it got the sign wrong on average. For decades nobody has worked from the expectations hypothesis as it's ...