Search found 61 matches

by dml130
Thu Oct 29, 2020 8:30 am
Forum: Investing - Theory, News & General
Topic: "Why those highly paid pros do worse than a boring stock index fund"
Replies: 39
Views: 4682

Re: "Why those highly paid pros do worse than a boring stock index fund"

I have a couple active funds in my 401k that have very impressive track records back to the 80s. They are of course large cap growth funds (Contafund and Harbor Capital Appreciation). The 2nd one is very concentrated, only has about 56 holdings..... and has been blowing the doors off of even the LC...
by dml130
Wed Oct 28, 2020 4:08 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Large Value Options
Replies: 16
Views: 1520

Re: Vanguard Large Value Options

Keep in mind that there is disagreement as to the definition of Value, we all agree that Value companies are cheaper than the market companies, but beyond that there is a lot of nuanced discussions. For example, I have argued that Book Value has decreasing importance and that investors should look ...
by dml130
Wed Oct 28, 2020 11:35 am
Forum: Investing - Theory, News & General
Topic: Vanguard Large Value Options
Replies: 16
Views: 1520

Re: Vanguard Large Value Options

Another approach towards large value could be the equal weight s&p 500 (RSP). It's not focused on traditional value metrics but ends up with more of a value (along with a little mid cap) tilt compared to the cap weighted index. For more traditional large cap value funds, to me MGV and VYM look prett...
by dml130
Sat Oct 24, 2020 7:48 pm
Forum: Investing - Theory, News & General
Topic: Best way to mitigate the top heaviness of Total Stock Market Funds
Replies: 118
Views: 8484

Re: Best way to mitigate the top heaviness of Total Stock Market Funds

I use RSP (equal weight s&p 500) as my large cap fund. I don't know if it will outperform or underperform in the future (who does?), but I think it's a reasonable enough proxy and it addresses the concern mentioned in the title of the thread.
by dml130
Fri Oct 23, 2020 8:55 pm
Forum: Investing - Theory, News & General
Topic: 7 Reasons Not to Use a 100% Stock Portfolio - The White Coat Investor
Replies: 200
Views: 13221

Re: 7 Reasons Not to Use a 100% Stock Portfolio - The White Coat Investor

In some situations, investors probably need 100% stocks. In others, they probably don't. But some here are claiming that nobody needs a 100% stock allocation, which is prima facie ridiculous. It's possible I'm missing something, but I'm having a hard time imagining a situation in which somebody nee...
by dml130
Fri Oct 23, 2020 7:26 pm
Forum: Investing - Theory, News & General
Topic: 7 Reasons Not to Use a 100% Stock Portfolio - The White Coat Investor
Replies: 200
Views: 13221

Re: 7 Reasons Not to Use a 100% Stock Portfolio - The White Coat Investor

But that isn't really a counterpoint to what is being argued, unless you are arguing that "enough stock market risk" is no less than 100% stocks. In some situations, investors probably need 100% stocks. In others, they probably don't. But some here are claiming that nobody needs a 100% stock alloca...
by dml130
Fri Oct 23, 2020 7:03 pm
Forum: Investing - Theory, News & General
Topic: 7 Reasons Not to Use a 100% Stock Portfolio - The White Coat Investor
Replies: 200
Views: 13221

Re: 7 Reasons Not to Use a 100% Stock Portfolio - The White Coat Investor

I think the doomsday scenarios described by posters in this thread are failing to be concerned with the other side of the coin. There is no such thing as zero risk when it comes to saving for retirement. Someone afraid to assume enough stock market risk assumes significant inflation risk as well as...
by dml130
Sat Oct 17, 2020 3:55 pm
Forum: Investing - Theory, News & General
Topic: Selective international investing
Replies: 22
Views: 1221

Re: Selective international investing

I've owned VTRIX for decades but have almost finished disposed of my shares this past week Maybe I'll keep $3k for old times sake as I finish moving it from Traditional to Roth. You may recall that back on Diehards (I think) there was a post commenting that at the time, Vanguard's two managed inter...
by dml130
Sat Oct 17, 2020 10:35 am
Forum: Investing - Theory, News & General
Topic: Selective international investing
Replies: 22
Views: 1221

Re: Selective international investing

I wouldn't trust myself to do any such selection, but I think this is a place where active management just might have some value. Vanguard has a mutual fund (VTRIX) that you might look into.
by dml130
Thu Oct 15, 2020 10:02 am
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

https://www.aqr.com/Insights/Perspectives/There-is-No-Size-Effect-Daily-Edition Great read. Basically because of the reduced liquidity of small-caps their beta was not accurately represented in regressions, which resulted in an unexplained premium (SmB) when in reality they were just loading up on ...
by dml130
Thu Oct 15, 2020 9:57 am
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

Yes, something like IVOO or IJH. It would fit for anybody wanting a much milder size and value tilt than an SCV fund would have. And their e/r's tend to be cheaper. For example, ishares IJJ (MCV) has an e/r of 0.25% whereas IJH (MCB) has an e/r of 0.05%. The spread is tighter for the Vanguard versi...
by dml130
Wed Oct 14, 2020 6:37 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

^
Interesting. You are referring to the s&p 400 blend (IVOO being one of those etfs)? How would that potentially fit in with a portfolio with a value tilt? I do have IVOV as a main holding in my portfolio, so I'm thinking there may not be much point in taking a position in the blend fund for me.
by dml130
Wed Oct 14, 2020 5:23 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

See above. It does have exposure, a pretty healthy amount for a blend fund really, but not as much as value of course. It also gets some quality screen because S&P600 requires positive earnings for a year to get included, but it isn't a very good quality screen because once in, you are in. Macy's f...
by dml130
Wed Oct 14, 2020 5:21 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

I see. Thanks for the explanation.
by dml130
Wed Oct 14, 2020 2:30 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

I see. So your position is that the s&p 600 does not have sufficient value in and of itself without the extra value filter of the s&p600 value? Also, my impression was that the S&P index itself controls for quality. Maybe I am wrong on that. (Thanks for your patience in explaining this by the way)
by dml130
Wed Oct 14, 2020 2:12 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

Day9 wrote: Wed Oct 14, 2020 2:05 pm
Small cap blend index funds don't control for junk.
But then, how are we defining "junk"? And by what mechanism if any does value (VIOV, for example) control for "junk" that is lacking in a fund like VIOO?
by dml130
Wed Oct 14, 2020 1:40 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

The plain S&P600 index should be avoided. The S&P600 value index (vanguard: VIOV, ishares: IJS) is a fine small cap value fund. Just curious, why do you have such opposite views of the two (s&p 600 vs s&p 600 value)? I'm looking and comparing the funds, and over 75% of the entire s&p 600 index is s...
by dml130
Tue Oct 13, 2020 4:34 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

Uncorrelated wrote: Tue Oct 13, 2020 3:18 pm
Get rid of the small cap fund. The evidence for small (SmB) as a stand-alone factor is weak. It only works in combination with other factors.
Just following up on this comment..to me, S&P 600 looks like it has a decent value factor, no?
by dml130
Tue Oct 13, 2020 4:09 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

Thank you, I may reconsider some of those holdings. I agree with what you say about international, I only listed my US holdings but I also have a significant international tilt (VEA and VSS).
by dml130
Tue Oct 13, 2020 2:25 pm
Forum: Investing - Theory, News & General
Topic: The Wrong Way to Think About Debt - The White Coat Investor
Replies: 203
Views: 24508

Re: The Wrong Way to Think About Debt - The White Coat Investor

I can get behind the idea of paying off my mortgage when the time is right, maybe a few years from now. But for now I'm relatively early on in my career, and I don't like the idea of most of my net worth being locked up in the equity of my home.
by dml130
Tue Oct 13, 2020 1:12 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

I was thinking along those lines as well but wanted to make sure I wasn't missing anything. Thanks for the advice, much appreciated.
by dml130
Tue Oct 13, 2020 12:11 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

Looking for advice on possibly simplifying my portfolio - hopefully this isn't deviating too much from the theme of this thread (I figured this is a good place to ask, since I have big small and value tilts). Right now, my US positions are as follows: RSP (equal weight s&p 500) for large/mid cap ble...
by dml130
Tue Oct 13, 2020 10:00 am
Forum: Investing - Theory, News & General
Topic: A look at funds managed by the Vanguard Quantitative Equity Group (VUVLX, VSEQX, VSTCX, VMNFX, VMNVX, VASFX, VPGDX)
Replies: 32
Views: 9416

Re: A look at funds managed by the Vanguard Quantitative Equity Group (VUVLX, VSEQX, VSTCX, VMNFX, VMNVX, VASFX, VPGDX)

Thanks for the reply. It seems like some of the outperformance you mention vs other small cap value funds could simply be due to its not being very heavy on small (it seems to be more mid cap) or value (seems more "blend"), since both factors have been underperformers the past couple years. But if t...
by dml130
Mon Oct 12, 2020 4:31 pm
Forum: Investing - Theory, News & General
Topic: A look at funds managed by the Vanguard Quantitative Equity Group (VUVLX, VSEQX, VSTCX, VMNFX, VMNVX, VASFX, VPGDX)
Replies: 32
Views: 9416

Re: A look at funds managed by the Vanguard Quantitative Equity Group (VUVLX, VSEQX, VSTCX, VMNFX, VMNVX, VASFX, VPGDX)

Bump. Wondering if people have any updated opinions on the strategic equity funds, specifically VSEQX (mid cap) and VSTCX (small cap). It appears the fees are lower now (0.17 for VSEQX, 0.26 for VSTCX) and seem reasonable to me for an actively managed fund. https://investor.vanguard.com/mutual-funds...
by dml130
Sun Oct 11, 2020 6:41 pm
Forum: Investing - Theory, News & General
Topic: Anyone going for the Dragon portfolio?
Replies: 25
Views: 3042

Re: Anyone going for the Dragon portfolio?

I skimmed Cole's paper awhile ago. It's an interesting read, but the portfolio strikes me as overly complicated for the typical investor. For example, you essentially have to time the market to use "commodity-trend", if I'm understanding correctly, which to me defeats the purpose of an all-weather t...
by dml130
Sun Oct 11, 2020 6:05 pm
Forum: Investing - Theory, News & General
Topic: "Active" Index investing vs. "Passive" Index investing
Replies: 197
Views: 7847

Re: "Active" investing vs. "Passive" investing

Something I've noticed is that the people who are drawn to and talented at individual stock picking tend to be exactly the type of people who are not particularly interested or versed in optimal portfolio allocation or academic finance. It is incredible to me to hear very successful investors like ...
by dml130
Wed Oct 07, 2020 9:37 pm
Forum: Investing - Theory, News & General
Topic: role of dividends in retirement withdrawal strategy
Replies: 32
Views: 2099

Re: role of dividends in retirement withdrawal strategy

The market value of stock is the last price a buyer was willing to pay for it and a seller was willing to part with it for. Period. In the long run, yes dividends reduce eventual market value. In the short run, I don't agree. This is my understanding as well. The dividend payout should affect the b...
by dml130
Sun Oct 04, 2020 8:47 am
Forum: Investing - Theory, News & General
Topic: Treasurys no longer provide the ballast for a portfolio
Replies: 106
Views: 8390

Re: Treasurys no longer provide the ballast for a portfolio

Ballast is the perfect word for what treasuries and other similar investments offer. Ballast is generally passive, dead weight that simply lowers the center of mass and improves the righting moment of a ship. The idea that bonds must zig when stocks zag has always been a myth, they are ballast beca...
by dml130
Sun Oct 04, 2020 8:19 am
Forum: Investing - Theory, News & General
Topic: Why not Real Estate instead of Stocks?
Replies: 187
Views: 13248

Re: Why not Real Estate instead of Stocks?

You can also engineer the same type of benefit from the market by buying REITs or dividend paying stocks/funds though. You could. But total return may be worse (depends on purchase price and type of asset purchased) Also REIT dividends taxed at ordinary rates No depreciation to reduce taxes No abil...
by dml130
Sun Oct 04, 2020 7:44 am
Forum: Investing - Theory, News & General
Topic: Why not Real Estate instead of Stocks?
Replies: 187
Views: 13248

Re: Why not Real Estate instead of Stocks?

I like both. I do think real estate may have an advantage if you wanna deal with it. One thing I seem to notice get ignored on the real estate side is monthly cash flow!!! One could generate enough cash early on to get you out of clocking in everyday for the man. The other requires you to put your ...
by dml130
Sat Oct 03, 2020 9:46 pm
Forum: Investing - Theory, News & General
Topic: Why not Real Estate instead of Stocks?
Replies: 187
Views: 13248

Re: Why not Real Estate instead of Stocks?

If you believe that returns on real estate will be better than other sectors, wouldn't REIT investments be an alternative way to express that, with less hassle?
by dml130
Sat Oct 03, 2020 12:11 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

If I already own an s&p 400 (mid cap) value fund, is this suitable as a "small cap value" holding for all intents and purposes, or should I think of this more as a "large value" tilt? I'm thinking the former (small value) but curious if others think I'm wrong on that. the S+P 400 is only a little b...
by dml130
Fri Oct 02, 2020 9:00 pm
Forum: Investing - Theory, News & General
Topic: Does the three fund portfolio provide adequate protection from inflation?
Replies: 56
Views: 4423

Re: Does the three fund portfolio provide adequate protection from inflation?

Thanks for the reply; I agree, that seems not so helpful. It's surprising to me that they would talk up Chinese bonds over real estate as an inflation hedge, but maybe I'm missing something.
by dml130
Fri Oct 02, 2020 5:40 pm
Forum: Investing - Theory, News & General
Topic: Does the three fund portfolio provide adequate protection from inflation?
Replies: 56
Views: 4423

Re: Does the three fund portfolio provide adequate protection from inflation?

^
I don't have a subscription, but the subtitle refers to "places to hide" -- "some of them surprising". If you don't mind, what are those places to which they are referring?
by dml130
Thu Oct 01, 2020 9:20 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

If I already own an s&p 400 (mid cap) value fund, is this suitable as a "small cap value" holding for all intents and purposes, or should I think of this more as a "large value" tilt? I'm thinking the former (small value) but curious if others think I'm wrong on that. First of all there is no set d...
by dml130
Thu Oct 01, 2020 7:12 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

If I already own an s&p 400 (mid cap) value fund, is this suitable as a "small cap value" holding for all intents and purposes, or should I think of this more as a "large value" tilt? I'm thinking the former (small value) but curious if others think I'm wrong on that.
by dml130
Tue Sep 29, 2020 8:44 am
Forum: Investing - Theory, News & General
Topic: What do Bogleheads think of what happen to Japan?
Replies: 66
Views: 5580

Re: What do Bogleheads think of what happen to Japan?

I just got through reading Fully Grown by Dietrich Vollrath and it fully met my biases with confirmation. I already thought all the stuff he wrote. He does not at all resort to using Japan as an example, but you can clearly see that Japan is a highly developed economy, extremely so, with a low birt...
by dml130
Mon Sep 28, 2020 12:36 pm
Forum: Investing - Theory, News & General
Topic: How would a USD collapse affect dollar-denominated international ETFs?
Replies: 21
Views: 1084

Re: How would a USD collapse affect dollar-denominated international ETFs?

I was asking about US domiciled funds such as VXUS, not funds domiciled outside the US, but the info is good to know anyhow. I'm curious how likely or possible (or unprecedented?) it is that countries force those types of funds to shut down in such an economic crisis.
by dml130
Mon Sep 28, 2020 12:05 pm
Forum: Investing - Theory, News & General
Topic: How would a USD collapse affect dollar-denominated international ETFs?
Replies: 21
Views: 1084

Re: How would a USD collapse affect dollar-denominated international ETFs?

In order for it to be life-changing you'd have to assume a lot of things: ... [*]The US government does not impose any kind of currency controls or restrictions on transborder currency or asset controls ... Just wondering, on this point, would such restrictions imply that in such a (probably unlike...
by dml130
Mon Sep 28, 2020 6:24 am
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

Okay, so it's considered "small" by these metrics, I guess. But, am I mistaken that this is also supposed to be a "value" fund of sorts? By what measure is TSLA considered a value stock? For RAFI indexes the tilt to value is dynamic, i.e. it buys recently beaten down stocks and sells recently appre...
by dml130
Sun Sep 27, 2020 11:36 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

Okay, so it's considered "small" by these metrics, I guess. But, am I mistaken that this is also supposed to be a "value" fund of sorts? By what measure is TSLA considered a value stock?
by dml130
Sun Sep 27, 2020 9:31 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

Funny note while looking at FNDA... it's 2nd largest holding at 0.47% is TSLA! Funny quirk with these fundamental small-cap funds, the small comes from the economic scale and not the market-cap :). I'm a little confused about this. I was looking at closely at FNDA but noticed that TSLA is a top hol...
by dml130
Mon Sep 21, 2020 5:32 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

I presume you mean active funds because a mutual fund can be a index fund, but even some “active” value funds are still targeting factor exposure via a systematic approach, while others could be a bottoms up fundamental active fund. I prefer systematic investing and think humans only reduce perform...
by dml130
Mon Sep 21, 2020 11:57 am
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

I presume you mean active funds because a mutual fund can be a index fund, but even some “active” value funds are still targeting factor exposure via a systematic approach, while others could be a bottoms up fundamental active fund. I prefer systematic investing and think humans only reduce perform...
by dml130
Mon Sep 21, 2020 11:41 am
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

Thanks for those links. Value is a difficult concept for me because to some degree it seems subjective. Some stocks that appear to be more "growth" might be considered as a great value by some due to strong prospects for future profit growth. And as mototrojan mentioned, even book values aren't app...
by dml130
Mon Sep 21, 2020 11:08 am
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

Wes Gray and Tobias Carlisle are both outspoken believers in enterprise value over EBIT or EBITDA. Jim O at OSAM has a great book What Works On Wallstreet that shows many different metrics including some composites dating back to early 1920's and P/B works but is not anywhere near the top dog (as W...
by dml130
Mon Sep 21, 2020 11:04 am
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

This is a very basic question, but, how are defining "value", and which equities qualify as "value" and which do not? Is this based mainly on price to book (from my reading of HML, it looks like it's primarily based on price to book)? This is an EXCELLENT question and for me it will always be a wor...
by dml130
Sun Sep 20, 2020 8:06 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

Ah you’re asking how to compare funds, not how the funds achieve said value exposure. Clearest and most consistent way is to regress the HML factor exposure which is based on P/B, but that is less effective with some niche funds. But there’s nothing stopping you from calculating any of these other ...
by dml130
Sun Sep 20, 2020 5:46 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 3132
Views: 230676

Re: Small Cap Value heads Rejoice !!!

This is a very basic question, but, how are defining "value", and which equities qualify as "value" and which do not? Is this based mainly on price to book (from my reading of HML, it looks like it's primarily based on price to book)? Many ways. Some use P/B, many a composite of various things like...