Search found 2389 matches

by Forester
Wed Aug 23, 2023 8:28 am
Forum: Investing - Theory, News & General
Topic: How can momentum and mean reversion both be true?
Replies: 28
Views: 2422

Re: How can momentum and mean reversion both be true?

All the well-known momentum ETFs are lagging the market since their early/mid 2010s inception. I think even with staggered rebalance dates, for example quarterly vs annual rebalance - these ETFs can get whipsawed by fluctuating market trends. Maybe industrials rally on one piece of news, then it's tech the next month.
by Forester
Sun Jul 09, 2023 5:14 am
Forum: Investing - Theory, News & General
Topic: Backtesting: How much in long term treasuries?
Replies: 108
Views: 9798

Re: Backtesting: How much in long term treasuries?

I sold all my bonds a while ago after getting spooked by stories on the possibility of the UK government revising the inflation measure and increased my allocation to low volatility stocks & gold. I believe this is a safer way to mitigate portfolio drawdown. No one has any idea what rates or inflation will resemble in 2025 or 2030 so a backtest to create an optimal portfolio is worthless. The more I think about the potential risk of bonds vs diversified baskets of stocks, the less I like. Bonds are like market timing in that they're a form of gambling. If stocks fall 50% then your forward returns will certainly be higher. Losses from bonds or market timing have no such guarantee, the "game" resets and then you're hoping for th...
by Forester
Fri Jun 30, 2023 11:59 am
Forum: Non-US Investing
Topic: UK wife ISA question
Replies: 14
Views: 2212

Re: UK wife ISA question

Depending on the platform, for whatever odd reason, sometimes either the accumulation or dividend version is available but not both. It's shown in the KIID and often there will be 'Acc' or 'Dis' at the end of the ETF name.

The other point to be aware of is you could have 3 identical ETFs on an ISA/SIPP platform but only one will be in Pound Sterling, the other two will be in Dollars & Euros. You just have to Google around and double check you are buying the correct ETF. Check on Morningstar and on the Vanguard site.

This is the accumulation version of the Vanguard global equity tracker: https://www.markets.iweb-sharedealing.c ... BQT80/QJ0X
by Forester
Tue Jun 27, 2023 1:16 pm
Forum: Non-US Investing
Topic: UK Financial Reforms - Allowing access to US ETFs!?
Replies: 13
Views: 3234

Re: UK Financial Reforms - Allowing access to US ETFs!?

Given the government’s commitment to fair and open capital markets, a key ambition in this area will be to continue improving choice of investment products for retail investors, particularly with respect to popular international investment products such as US-based ETFs.
This is potentially very exciting. It never made much sense that we could own individual US shares in tax-advantaged pensions & savings of accounts, but diversified baskets of those same shares in a US-domiciled ETF, were deemed off limits.
by Forester
Tue Jun 27, 2023 1:08 pm
Forum: Non-US Investing
Topic: UK wife ISA question
Replies: 14
Views: 2212

Re: UK wife ISA question

iWeb (and maybe one or two others) would be cheaper. Vanguard charge 0.15% a year on top of fund costs and Fidelity charge 0.35%, whereas iWeb only charge £100 to open the account, then £5 to buy an ETF or share. iWeb does not have a flashy website but it's owned by Lloyds Bank.

https://www.iweb-sharedealing.co.uk/charges.html
by Forester
Mon Jun 19, 2023 12:17 pm
Forum: Investing - Theory, News & General
Topic: how many of ya'll invest in equal weighted S and P 500?
Replies: 80
Views: 9990

Re: how many of ya'll invest in equal weighted S and P 500?

Equal weighting the S&P 500 strikes me as a poor man's value tilt. The equal weight index is more useful & interesting as a barometer of megacap excess, as opposed to something I would want to invest in.
by Forester
Sun Jun 11, 2023 12:47 pm
Forum: Investing - Theory, News & General
Topic: Coming out of bear market - what asset classes do well
Replies: 34
Views: 3921

Re: Coming out of bear market - what asset classes do well

For me it's a very "meh" uninspiring market. Ex-US overall and US small/value are priced for normal average returns and US large cap is expensive. I would guess that even value-tilted portfolios cannot get more than 4% or 5% real returns, going forward.
by Forester
Fri Jun 09, 2023 2:51 pm
Forum: Investing - Theory, News & General
Topic: Bear v Bull
Replies: 24
Views: 2616

Re: Bear v Bull

Should ATHs be adjusted for inflation? I believe they should. Therefore SPX 4808 in December 2021 = 5231 today. So the S&P is 18% off its ATH. It is a correction but not a bear market, using the arbitrary 20% rule.
by Forester
Wed Jun 07, 2023 1:12 pm
Forum: Investing - Theory, News & General
Topic: SCHD Poor Performance
Replies: 122
Views: 19765

Re: SCHD Poor Performance

Regarding diversification of the dividend ETFs vs the index.

TSM has 26% in the top 10 holdings, whereas the MSCI High Dividend Index (which some of these ETFs will be based on), has 32% in the top 10 holdings. On the other hand, TSM is 29% InfoTech, versus 18% for the dividend strategy.

https://www.msci.com/documents/10199/67 ... b53e8d0d9f
https://www.msci.com/documents/10199/fe ... 399b9bd1eb

I wouldn't make any changes right now, given the big run up by the tech titans in 2023.
by Forester
Tue Jun 06, 2023 8:45 am
Forum: Investing - Theory, News & General
Topic: AQR warning: time to rotate to International?
Replies: 39
Views: 4380

Re: AQR warning: time to rotate to International?

steve321 wrote: Sun Jun 04, 2023 8:37 am What do you think?
I believe investors should hold ex-US stocks in line with the global cap weighting. Otherwise it's a game of gambling on US Dollar strength. The Dollar Index a year from now could be the same, or at 70 or 130, no one knows.

It's probably the case that US stocks are better diversifiers for non-US investors than vice versa, because in a stress environment money flows to the senior currency. Therefore US investors may feel justification in having home country bias and only holding, say 20% ex-US stocks (as opposed to the 40% ex-US represented in the global capweight index).
by Forester
Sun Jun 04, 2023 5:09 am
Forum: Investing - Theory, News & General
Topic: [Market prediction assuming that 2022-2025 is similar to 1980-1982]
Replies: 20
Views: 2633

Re: [Market prediction assuming that 2022-2025 is similar to 1980-1982]

Possible is a sideways market for a few years with inflation a touch higher than in the 2010s. This brings valuations down closer to long term norms. And is the most frustrating i.e. likely outcome, both for permabulls & permabears who are mentally stuck in the 2007-2021 timeframe respectively. The cumulative inflation since Jan '22 will partially mask the true extent of the drawdown.
by Forester
Fri Jun 02, 2023 2:57 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 5577
Views: 623803

Re: Small Cap Value heads Rejoice !!!

From a Crescat Capital presentation;
https://www.youtube.com/watch?v=JIxu9I2bVu0

Image

It really looks like dip buying and people wanting to party like it's still 2020/21.
by Forester
Tue May 30, 2023 12:03 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 5577
Views: 623803

Re: Small Cap Value heads Rejoice !!!

The growth-value spread must be at fresh all-time highs. Checking QQQ (Nasdaq) vs IJS, and Nasdaq is leading small value from both before & after the March '20 bottom.
by Forester
Sun May 07, 2023 12:30 pm
Forum: Investing - Theory, News & General
Topic: Portfolio protection with Trend
Replies: 42
Views: 4387

Re: Portfolio protection with Trend

As we know, 2022 has been a great year for trend-following funds. Trend funds are mostly basically a diversified basket of bonds, commodities and currencies, held in the form of futures according to defined trend-signals. What I like about trend funds: they can go long or short bonds/commodities/currencies, so they are less path-dependent than holding bonds etc. long only. Path-dependency matters, because we only live once, and don't want to catch the long bond-bear. Bonds can have decades-long negative real returns. Also, by having commodities (including gold) in your portfolio too, you get additional diversification and inflation-protection for the times when both stocks & bonds don't work. So my question is, can Trend ever align wit...
by Forester
Sun May 07, 2023 12:24 pm
Forum: Investing - Theory, News & General
Topic: S&P 500 P/E ratio
Replies: 311
Views: 18540

Re: S&P 500 P/E ratio

burritoLover wrote: Sun May 07, 2023 10:13 am Higher PEs, all else equal, infer less risk, not more risk.
It depends how you look at this, risk as defined by volatility, or risk of a big drawdown. Firstly, higher PE stocks would be riskier if (and no one knows) inflation proves to be sticky. And at this point in time, lower volatility stocks have slightly lower PEs & higher dividend yield than high PE stocks (or total stock market):

https://www.msci.com/documents/10199/f5 ... 761d009094
by Forester
Sat May 06, 2023 6:29 am
Forum: Investing - Theory, News & General
Topic: Financial podcasts
Replies: 43
Views: 5583

Re: Financial podcasts

The Meb Faber Show - the podcast title surmises the show well so one can decide if it's worth a listen The Acquirers Podcast - the markets from a value investor POV The Market Huddle - fortnightly, excellent lighthearted market commentary with insightful interviews. I like this podcast the most Money For The Rest Of Us - the host usually attacks subjects from a leftfield POV which is interesting Behind The Markets - if the S&P is in the middle of some drama, always listen to the first 5 minutes which is where Jeremy Siegel shows up Excess Returns - value/factor investing centric, personable hosts who break things down for the layman TDI Podcast - old school boomer 1990s market commentary, host is engaging and often has good guests We St...
by Forester
Thu May 04, 2023 4:38 am
Forum: Investing - Theory, News & General
Topic: Small Cap vs Large Cap (cherry picked timeframe)
Replies: 145
Views: 8003

Re: Small Cap vs Large Cap (cherry picked timeframe)

Did a general backtest for SC, SCV, and LC. Did the BT for a specific time period starting in 1999 to now. Just curious as to what specifically made the size matter so much. Based on this timeframe, smaller is better. Blend or value did much better than large blend. There were larger drawdowns for small. More volatility for small. Seems like small falls harder but bounces back up higher. Higher enough to keep it on top. Kind of surprising. https://www.portfoliovisualizer.com/backtest-asset-class-allocation?s=y&mode=1&timePeriod=4&startYear=1999&firstMonth=1&endYear=2023&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjuste...
by Forester
Mon Apr 10, 2023 12:51 pm
Forum: Investing - Theory, News & General
Topic: WSJ: "This Should Have Been a Great Year for Gold. Here’s Why It Isn’t."
Replies: 248
Views: 27054

Re: WSJ: "This Should Have Been a Great Year for Gold. Here’s Why It Isn’t."

Gold tends to rise over the following six, twelve months when it is down 10% or so (when the WSJ article appeared), and vice versa. When/if gold is up 20% over the last 12 months, it will be all over CNBC and the financial media, but history suggests that will prove to be a poor entry point.
by Forester
Sat Mar 25, 2023 8:10 am
Forum: Investing - Theory, News & General
Topic: Can value stocks mitigate sequence of returns risk?
Replies: 308
Views: 21086

Re: Can value stocks mitigate sequence of returns risk?

Gold mining stocks did well through the GFC, and possibly also the Great Depression, using Homestake Mining as a proxy;

Dotcom;
https://www.portfoliovisualizer.com/bac ... sisResults

GFC;
https://www.portfoliovisualizer.com/bac ... sisResults

Image

All things being equal, gold miner profitability should increase during a contraction, following a frothy speculative financial market.
by Forester
Fri Mar 24, 2023 3:08 pm
Forum: Investing - Theory, News & General
Topic: Hydromod's Okay Adventure: Leverage, Momentum, and Risk Management
Replies: 89
Views: 15906

Re: Hydromod's Okay Adventure: Leverage, Momentum, and Risk Management

Momentum is a form of gambling which can lock in unrecoverable bad timing luck. Why not The Simplest Adventure - 100% USML, the levered min vol ETF. That's the real free lunch, levering up low vol stocks.
by Forester
Wed Mar 22, 2023 3:01 pm
Forum: Investing - Theory, News & General
Topic: Three kinds of bonds for three reasons
Replies: 12
Views: 1876

Re: Three kinds of bonds for three reasons

The long term CAGR difference of 100% stocks vs 60/40 is not that great ( https://www.portfoliovisualizer.com/backtest-asset-class-allocation?s=y&mode=1&timePeriod=2&startYear=1972&firstMonth=1&endYear=2023&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=4&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&debtAmount=0&debtInterest=0.0&maintenanceMargin=25.0&leveragedBenchmark=false&portfolioNames=false&portfolioName1=Portfolio+1&portfolioName2=Portfolio+2&portfolioName3=Portfolio...
by Forester
Wed Mar 15, 2023 4:48 pm
Forum: Investing - Theory, News & General
Topic: Ben Felix: International Diversification.
Replies: 475
Views: 28565

Re: Ben Felix: International Diversification.

Ben Felix sees everything through the CAPM factor model lens, so it's an "appeal to authority" bias of sorts. To me it seems more like an appeal to the best theoretical understanding of available evidence lens. In other words, the approach that has shown to be more consistently practical than any other. I just think he's biased. In his video on low volatility stocks he presented selective evidence from a 2014 paper against the "low vol anomaly", a paper which has been refuted by others. I have a problem with this approach, of essentially standing as an impartial authority (literally the "rational reminder") on platforms such as YouTube which are used by the general public, all the while having a closed mind.
by Forester
Wed Mar 15, 2023 4:29 pm
Forum: Investing - Theory, News & General
Topic: Ben Felix: International Diversification.
Replies: 475
Views: 28565

Re: Ben Felix: International Diversification.

Ben Felix sees everything through the CAPM factor model lens, so it's an "appeal to authority" bias of sorts.
by Forester
Fri Mar 10, 2023 1:06 pm
Forum: Investing - Theory, News & General
Topic: Gold continues to soar!
Replies: 565
Views: 63224

Re: Gold continues to soar!

The main thing I am glued to at the moment is GDX vs the S&P. In late 2008 we had bad news (Lehman etc) either side of the gold miners bottoming. Then the miners (and the metals) began to rally in November 2008 even though the S&P was only halfway through its drawdown. Coincidentally (or not) the 2008 gold miner rally also marked the peak for real interest rates.
by Forester
Fri Mar 10, 2023 12:05 pm
Forum: Investing - Theory, News & General
Topic: 2022-2023 Bear Market Is Over
Replies: 156
Views: 27264

Re: 2022-2023 Bear Market Is Over

US small cap has gone nowhere since 2015, after inflation. Aside from US large cap, everything else looks very promising. My guess would be, real terms Nasdaq/S&P loses another 20% from here, ex-US/value loses 15% or so, then we have another good run.

It's more like 2000/2003 than 2008, everyone got carried away on meme stocks & housing and it's just a healthy correction. It could be a few years though before the S&P 500 makes a real new ATH, I think the baton has passed to countries like Brazil for the timebeing.
by Forester
Sat Feb 25, 2023 2:45 pm
Forum: Non-US Investing
Topic: Starting my Investment journey [UK]
Replies: 24
Views: 2993

Re: Starting my Investment journey [UK]

Hi, Thanks for taking the time to read this and it's been asked a couple of times but I would like some advice on my own personal situation. Currently been employed for four years where I started as an apprentice and managed to save up and purchase a new car in full which was one of my goals (no debt). I have also saved up an emergency fund of £1000 where I keep in a high interest savings account. I'm now looking starting my investment journey to hopefully retire by the age of 50? If possible. I want to start by investing 15% of my gross pay per month and take it from there. I take home £30,000 per year after tax as a mechanic. Reading the wiki I'm favouring an asset allocation of around 60/40 which probably fits my risk perfectly since I ...
by Forester
Sat Jan 21, 2023 2:39 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 5577
Views: 623803

Re: Small Cap Value heads Rejoice !!!

Quick Excel math:

For US small cap value (IJS) to reach its May 2006 zenith vs large cap growth (IVW), IJS would be 48% higher at $144.

The average IVW/IJS ratio since 2000 is 1.84, implying that IJS "should" be $110, about 13% higher.
by Forester
Sat Jan 21, 2023 8:10 am
Forum: Investing - Theory, News & General
Topic: Small/Large Value: What Happened in 2001-2002? Why?
Replies: 17
Views: 1521

Re: Small/Large Value: What Happened in 2001-2002? Why?

Large & Growth / TSM tend to do well together. So when US large cap growth was outperforming in the late 1990s, some of that overvaluation spilled over into large caps overall.
zero_coupon wrote: Fri Jan 20, 2023 11:29 pmGiven that SCV and LCV perform similarly over time, what would be the expected consequence of replacing all the LCV in one's portfolio with SCV?
My layman's take on all this; SCV works best with broad indexes by the likes of MSCI, where the turnover is moderate. But deep value strategies, buying the cheapest of the cheap (ETFs like QVAL), work better with LCV, as these strategies rebalance more frequently and hold much fewer positions.
by Forester
Wed Jan 04, 2023 2:30 pm
Forum: Investing - Theory, News & General
Topic: 2023 Hedge Fund contest
Replies: 199
Views: 27477

Re: 2023 Hedge Fund contest

Mediocre Investments

Long
- Newmont Corp NEM
- Novagold Resources NG
by Forester
Mon Jan 02, 2023 4:32 am
Forum: Investing - Theory, News & General
Topic: Another bad year for CTAs (managed futures)
Replies: 8
Views: 2059

Re: Another bad year for CTAs (managed futures)

7.55% for the Barclays CTA Index in 2022, best year since 2014. https://portal.barclayhedge.com/cgi-bin/indices/displayCtaIndex.cgi?indexCat=Barclay-CTA-Indices&indexName=Barclay-CTA-Index Probably uncharitable to point out that CTAs had a negative real return. On the other hand, the GSCI commodity index ETF grew by 24% in 2022: https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=4&startYear=2022&firstMonth=1&endYear=2022&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageT...
by Forester
Mon Jan 02, 2023 4:20 am
Forum: Investing - Theory, News & General
Topic: MTUM Rebalancing Its Holdings -- Impact on Price?
Replies: 12
Views: 2583

Re: MTUM Rebalancing Its Holdings -- Impact on Price?

2022 showed the risks of factor investing methodology, big difference in the performance of the three big US momentum ETFs. https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=4&startYear=2022&firstMonth=12&endYear=2022&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&debtAmount=0&debtInterest=0.0&maintenanceMargin=25.0&leveragedBenchmark=false&reinvestDividends=true&showYield=false&showFactors=false&factorModel=3&a...
by Forester
Wed Dec 21, 2022 9:23 am
Forum: Investing - Theory, News & General
Topic: Is the market down?
Replies: 45
Views: 7937

Re: Is the market down?

The market is expensive and got ahead of itself after 2016. New trend will be SPX 3,000 + 5% real returns after that, highly likely 2021 to 2030 will be a lost decade similar to 2000 to 2013.
by Forester
Fri Oct 28, 2022 5:54 am
Forum: Investing - Theory, News & General
Topic: Long Treasuries down 55%. Time to bottom fish?
Replies: 416
Views: 52438

Re: Long Treasuries down almost 50%. Time to bottom fish?

Luke Gromen said the 10 year could be 6% before the end of the year; https://youtu.be/cteEvoe-CgI @38:00 to 40:00
by Forester
Tue Oct 25, 2022 12:11 pm
Forum: Investing - Theory, News & General
Topic: The Smart Money Indicator
Replies: 9
Views: 1622

Re: The Smart Money Indicator

There is now an ETF based on this concept, switching between US & ex-US Developed stocks, and can also own up to 20% gold.

$MOOD https://relativesentiment.com/

We have a few mechanical timing ETFs now such as ROMO RORO JOJO PTLC VMOT FVC and so on. In the Vanguard corner are the likes of VSMGX or VASGX which simply rebalance fixed allocations.
by Forester
Tue Oct 25, 2022 4:53 am
Forum: Investing - Theory, News & General
Topic: VWO seems cheap right now
Replies: 203
Views: 48626

Re: VWO seems cheap right now

When this thread was created the US dollar index was around 93 or so, today it is much higher at 127. And 2013 is only two years off the peak of the 2000s commodities-BRICs epic bull market. These things zig and zag, I wouldn't bet money against VWO one day beating VTI since its inception in 2005.

Everyone will think US stocks are pointless in a world of a weak dollar and perpetually high commodity prices, and there'll be a bunch of fresh new tech startups in Texas/California and the whole cycle goes again.
by Forester
Fri Oct 21, 2022 8:51 pm
Forum: Investing - Theory, News & General
Topic: Long Treasuries down 55%. Time to bottom fish?
Replies: 416
Views: 52438

Re: Long Treasuries down almost 50%. Time to bottom fish?

I don't see how inflation backs off in 2023, assuming that China re-opens fully alongside the US dollar giving up the 2022 gains. US inflation got to 9% even with a strong dollar tempering import prices. Consensus seems to be that the 10yr tops out at 4.5% to 5% but my gut feeling is the 10yr reaches 7% or 8% in 2023.
by Forester
Wed Oct 19, 2022 6:29 am
Forum: Investing - Theory, News & General
Topic: Thoughts on Research Affiliates?
Replies: 12
Views: 1550

Re: Thoughts on Research Affiliates?

At present the Fundamental Index does not appear to differ much at all from Equal Weight portfolios: https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=2&startYear=1985&firstMonth=1&endYear=2022&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&debtAmount=0&debtInterest=0.0&maintenanceMargin=25.0&leveragedBenchmark=false&reinvestDividends=true&showYield=false&showFactors=false&factorModel=3&portfolioNames=false&...
by Forester
Fri Oct 14, 2022 8:58 pm
Forum: Investing - Theory, News & General
Topic: How unusual is the current downturn? Actually pretty common.
Replies: 94
Views: 16873

Re: How unusual is the current downturn? Actually pretty common.

Sort of interesting, if you track cumulative inflation back to January 2018, we're not far from the S&P 500 total return incl dividends, only matching inflation, zero real return, for four and a half years.
by Forester
Wed Oct 12, 2022 3:32 am
Forum: Investing - Theory, News & General
Topic: Is "Stay The Course" dead?
Replies: 416
Views: 48501

Re: Is "Stay The Course" dead?

I believe we're reaching the point, where retirees / near retirees who were advised to de-risk from stocks into bonds, are owed an explanation :idea:
by Forester
Sat Oct 01, 2022 9:24 am
Forum: Investing - Theory, News & General
Topic: Market timing tactical allocation ETF disappoints ($RORO) vs 60/40
Replies: 19
Views: 2715

Re: Market timing tactical allocation ETF disappoints ($RORO) vs 60/40

It's been a bad year for $RORO (and its sister funds), down 45% YTD, somehow underperforming both the the S&P 500 and the risk-off asset (long term bonds) which $RORO is intended to rotate into. However it appears that the lumber vs gold strategy is to be resurrected with a new ETF named $LOLO : https://www.sec.gov/Archives/edgar/data/1742912/000138713122008411/lolo-485apos_080522.htm This ETF will switch between 100% % 200% exposure to stocks based on the trailing 10-week lumber/gold ratio. Leverage-On. When the LOLO Index signals a Leverage-On position, the Fund will seek to have a 200% daily exposure to either the large-cap equity market (Large-On) or the small-cap equity market (Small-On), as applicable (and as described more below)...
by Forester
Fri Sep 30, 2022 10:14 am
Forum: Investing - Theory, News & General
Topic: Gold continues to soar!
Replies: 565
Views: 63224

Re: Gold continues to soar!

Today I sold some gold and bought more of the gold miner ETF. I really think the recent relative good performance of GDX vs S&P 500 / Nasdaq, is reminiscent of late March 2020 & November 2008, it feels like the turn is here. And the miners are cheap versus the metal on every lookback period. Gold miners go sideways / up from here, while the big indexes continue to find their bottom. If I'm wrong, well I'll be a bagholder until gold stocks eventually recover but we will see.
by Forester
Thu Sep 29, 2022 5:29 am
Forum: Investing - Theory, News & General
Topic: 60/40 vs. Golden Butterfly for Retirement
Replies: 47
Views: 7875

Re: 60/40 vs. Golden Butterfly for Retirement

Hypothesis 2 is failing its stress test right now. In a time of inflation and distress, gold is *not* performing the way you'd hope. Personally, I'd have trouble sticking with a portfolio of only 40% equities, locking in negative real yields with the cash and bond segments of the portfolio, and locking in expected zero real return for gold. I agree on the second point that gold will likely detract from very long term gains (while potentially shining occasionally while stocks & bonds flounder). But on your first point, gold is near all-time highs in most currencies aside from the dollar. https://i.postimg.cc/bNnQcdqd/Screenshot-2022-09-29-112426.png Year-to-date, priced in US dollars; Gold -9.45% S&P 500 -21.08% Long bonds -28.63% T...
by Forester
Mon Sep 26, 2022 1:16 pm
Forum: Investing - Theory, News & General
Topic: HEDGEFUNDIE's excellent adventure Part II: The next journey
Replies: 14360
Views: 1989675

Re: HEDGEFUNDIE's excellent adventure Part II: The next journey

With respect to bonds, the FED has made it clear (at least for now) that they are going to fight inflation which would support more rate hikes until they say otherwise. Not quite sure why anyone would be in 3x long 20yrs until their posture changes. Won't be perfect, but the FED does tend to trend rates in one direction for a while. The problem with this journey was that using leveraged bonds as a ballast is very problematic when rates basically went from the teens in the early 80's to basically 0 and then inflation reared its ugly head. Perhaps , LT, there is a free lunch with this strategy, but the drawdowns can be so severe that the ability to stomach those losses would test many investors RM One alternative I posted before is simply ho...
by Forester
Sat Sep 24, 2022 3:50 am
Forum: Investing - Theory, News & General
Topic: Really Bad Day - 09/13/2022
Replies: 141
Views: 24317

Re: Really Bad Day - 09/13/2022

Using VGTSX, one can see that ex-US real returns (and soon nominal?) are flat since November 2007 :o
by Forester
Fri Sep 23, 2022 12:03 pm
Forum: Investing - Theory, News & General
Topic: Really Bad Day - 09/13/2022
Replies: 141
Views: 24317

Re: Really Bad Day - 09/13/2022

After inflation, S&P 500 down around 28% from the Jan high? It's funny that the typical portfolio could end up down more in 2022 than in 2008 but absent the panic of 2008. Everything that's happened so far has been calmly digested.
by Forester
Tue Sep 20, 2022 4:47 am
Forum: Investing - Theory, News & General
Topic: WSJ: "This Should Have Been a Great Year for Gold. Here’s Why It Isn’t."
Replies: 248
Views: 27054

Re: WSJ: "This Should Have Been a Great Year for Gold. Here’s Why It Isn’t."

Gold is one of best performing assets this year if priced in the Euro, Sterling, Yen and Aussie Dollar. This year's star asset has been the US Dollar.
by Forester
Sun Sep 18, 2022 5:06 am
Forum: Investing - Theory, News & General
Topic: Foreign stocks are cheaper
Replies: 94
Views: 11166

Re: Foreign stocks are cheaper

The Dollar Index today is at 109 and a fair number of commentators think it can get to 120. When the dollar eventually weakens, the relative out-performance of ex-US stocks will be impressive.

It's a similar story to the Nasdaq / ARKK etc in 2020 & 2021, just when it was unimaginable that tech stocks could get more expensive, they went and did it. Maybe the US dollar will peak late this year amid issues in Europe & China, and with it will be the peak of relative US stocks vs ex-US stocks performance.
by Forester
Tue Sep 13, 2022 2:42 am
Forum: Investing - Theory, News & General
Topic: Momentum, Trend, and Managed Futures
Replies: 14
Views: 1472

Re: Momentum, Trend, and Managed Futures

Is it worth making 8% YTD with managed futures when the GSCI commodity index is up 17%?

https://portal.barclayhedge.com/cgi-bin ... -CTA-Index

These strategies are a form of gambling, you have no reasonable idea ahead of time, by how much you will over perform or under perform the underlying commodity futures.