Bogleheads.org

chassis wrote: ↑Wed Mar 29, 2023 6:08 am Avoid labels and headlines. What do you want? Do you want to increase your equity exposure? If yes, then do it.

Seems reasonable. Thanks.

climber2020 wrote: ↑Wed Mar 29, 2023 6:12 am If you're going to buy more stocks, doing so when they're 20% cheaper than they were not that long ago seems like a decent time.

Yes, but isn't this just anchoring on an arbitrary high? CAPE is still pretty high. Nevertheless, if we're headed for a deeper drawdown, it would be comforting to buy more equity knowing that some of the drawdown is already behind us.

DavidInMaryland wrote: ↑Tue Mar 28, 2023 9:14 pm Has anyone recently opened a Fidelity CMA account? I like the sound of what's been discussed here, so I submitted an application this weekend. To my surprise it wasn't instant, and the website said it would take 1-2 business days to open, but now it's been 2 and I haven't heard anything at all - I never even got a confirmation email that they had received my web application.

Could you describe the application process? What information do they request? Did they pose identity verification questions about your personal history (e.g. previous autos, addresses, phone numbers, etc.) in the manner of some banks?

Lou354 wrote: ↑Wed Mar 29, 2023 4:33 am If not now, when would you increase your allocation to equity? After a market crash and in the depths of a brutal recession? After the market has gone up?

I suppose that's always the relevant question. Of course, market timers hope to implement such a change after further decline, not after an increase.

I guess there's no good reason to expect either an increase or decrease in the near term. I'm a bit pessimistic about the near-term economic future, but of course I don't know better than the collective opinion expressed via current market prices. It just seems that corporations will struggle as the Fed combats sticky inflation.

You can't Roth convert an inherited IRA. I know that is true and have heard that a thousand times on this forum. But what I understood the OP to be saying is that he has an inherited IRA that he has to draw down. And in drawing it down, let's say he pulls out 6.5k annually, he then re-invests that money into a Roth. Couldn't he do that? Maybe that's not a "conversion" or a "transfer" but it is taking money from the tIRA and moving it into a Roth. Obviously if he is trying to move more than that in 1 calendar year he wouldn't be able to do that, absent putting money money into a Roth 457 or similar. As long a the individual is eligible to contribute to a Roth IRA, the source of the contribution doesn't matter. It would s...

chemocean wrote: ↑Tue Mar 28, 2023 10:43 pm Others with new licenses and license numbers have been denied verification online and were told they had to come to a branch to open an account.

Do some brokers use these third-party verifiers too, or is this a bank thing?

Suppose you desired a permanent increase in your equity allocation, expecting to improve long-term returns. Also suppose you had some rational economic concerns (potential recession looming, etc.). Would you avoid market timing and implement your new asset allocation immediately? If so, why? Or would you avoid increasing equities now, citing economic concerns and current availability of attractive fixed-income options?

I know the standard Boglehead answer, but current economic condtions do raise concerns. I suppose there are always concerns, and I suppose it's futile to outguess the market's pricing ability. However it seems corporations may struggle in the near future (of course, I have no information the market hasn't already considered).

chemocean wrote: ↑Mon Mar 27, 2023 11:56 pm When you apply online, your identity is verified not my the credit reporting agencies, but by third party verifiers based on data you provide during the online application and historical data in their database. This happens even before your credit score is checked. If I enter my new driver's license, I will fail the verification process because the third-party verifiers think I am giving them wrong information and be told to apply in person.

Do the major brokerage houses (e.g. Vanguard, Fidelity, Schwab) pose verification questions such as this (concerning historical personal data, driver's license number, etc.) when processing online account applications? Or is this done only by banks, but not brokers?

zeal wrote: ↑Sat Apr 13, 2019 10:51 pm ...The reason we had to jump through all these "identity verification" hoops is because ... we were opening the accounts online ... so when a computer tries to open a new account for someone and can't complete a background check due to lack of data/history it spits out a red flag.

In such cases, do people believe an account application is more likely to pass muster when physically signed and mailed on paper, instead of being submitted online?

I've seen many posts recently seeming to prefer VEA over VXUS. People are nervous about emerging markets. Anything to this?

kojima wrote: ↑Wed Mar 22, 2023 5:34 am Fidelity should have it so that the user can use their own 2FA app. There are many proper 2FA apps out there that are more secure and offer backups.

feh wrote: ↑Wed Mar 22, 2023 6:08 am Unhappy that Fido doesn't support Google authenticator or Authy.

Actually, they do. See here:

zero_coupon wrote: ↑Thu Dec 22, 2022 3:55 pm

MrJedi wrote: ↑Thu Dec 22, 2022 1:16 pm There is actually an unofficial way to provision your own Symantec VIP ID and get the TOTP secret (QR code) yourself instead of being hidden inside the app or fob/token. Then you can use that secret to put into your preferred authenticator app instead of using the Symantec VIP app.

Instructions:

www.reddit.com/r/personalfinance/commen ... hoice_for/

2. Put me on as a joint account holder to have coverage for 500K (but I really don't want to do that, there could be tax implications for me, and I pay at a higher rate ). I don't believe there would be tax implications for you in this case. The account would continue to be reported under her (not your) tax ID for taxation purposes, and jointly titling the account would not constitute a gift (i.e. Form 709) to you, as long as you do not use the funds as your own. IMO, this is a reasonable solution. Can others corroborate this? - One owner with two payment-on-death (POD) beneficiaries on the account should be covered for 500K. How about 250K in individual account, plus 250K in POD account with one beneficiary? Covered for 500K in aggregate?

Mel Lindauer wrote: ↑Sun Mar 19, 2023 2:58 pm

zero_coupon wrote: ↑Sun Mar 19, 2023 3:40 am

Mel Lindauer wrote: ↑Sun Mar 19, 2023 1:23 am However, despite the fact that Mid-Caps had been very good to me, once I had attained "more than enough", I reduced the equity portion of my portfolio and opted to move the reduced equity portion to Vanguard's Index 500 fund, which is now my sole equity holding.

So much for "stay the course," ha ha.

When you finally reach shore after rowing in turbulent waters, do you continue to row or do you start walking?

Indeed...just giving you a hard time (hoped to convey this via "ha ha," but fell flat). Best regards.

peteyboy wrote: ↑Sun Mar 12, 2023 6:43 pm Those commenting on this thread might find the spreadsheet below interesting - I think this comes from the linked thread posted by retired@50 in the second post in this thread:

https://docs.google.com/spreadsheets/d/ ... 1074987830

As far as MM munis go, they fluctuate/cycle much more than MM treasuries, at least for the last year or so. It looks like muni MM funds only make sense at the highest marginal rates (Fed and State), especially if holding for longer periods, say >3 months.

Thanks.

Mel Lindauer wrote: ↑Sun Mar 19, 2023 1:23 am However, despite the fact that Mid-Caps had been very good to me, once I had attained "more than enough", I reduced the equity portion of my portfolio and opted to move the reduced equity portion to Vanguard's Index 500 fund, which is now my sole equity holding.

So much for "stay the course," ha ha.

I am investigating doing long-term capital gains harvesting this year, in our Vanguard brokerage account, and I am confused a bit about the mechanics of it. All of the TLH blogs and step-by-step examples I've seen mention how, when you sell VTSAX, and exchange with some other fund, Vanguard informs you that you cannot buy back in to VTSAX for at least 30 days. So, from a "trading mechanics" POV, how would I do TGH, since I'd want to sell VTSAX, and then immediately buy back into VTSAX with the total amount I had just sold? Do I need to buy into something else for 31 days, and then buy back into VTSAX, selling that holding? I appreciate any light y'all can shed on this situation. The warning applies to tax loss harvesting. In a ga...

It's possible to get a bonus in some cases: I just pulled the trigger on the move to Fidelity - the process is started. Here's how to get the transfer bonus: 1. Call 800-343-3548 Say "Guidance" or "Promotions" at the bot prompt. Answer Yes to "Do you want to speak with an Advisor?" (I'm not sure on the exact question, but I answered "Yes" to proceed.) This gets you to the Investment Solutions team, which is the right group to handle incentives. (You can't do this by chat.) 2. Speak with the rep The rep will register your account to receive the cash award. 3. Do the transfer Follow Fidelity's instructions. You'll need to create a new Fidelity account to receive the transfer. I created a Roth and Tradit...

grabiner wrote: ↑Wed Jan 04, 2023 11:09 am ...muni funds never have capital gains.

This isn't true in general, is it?

Thanks everyone ... lots of good responses here.

nisiprius wrote: ↑Sun Mar 12, 2023 4:46 pm ...about the same.

That's what I was thinking, and you are correct that I was referring to large cap (or at least the largest 85% of the market, as represented by VUG+VTV).

I know people hate Treasury Direct, but if you have too much cash, autorolling T-Bills st Treasury Direct avoids bank and brolerage failure risk. Yeah, but if your money gets stolen you have no recourse. TD offers no guarantee to make you whole. Has anyone's TD account been hacked? Not that I'm aware of, but this issue has been discussed: Oh yeah, and TD offers no protections at all if your securities are somehow stolen, and for this reason alone, one of the great savings bond champions on this site, Mel L., won't even buy savings bonds at TD. Point taken. Fidelity for t-bills it is! Yes, but aparently Treasurys are just considered ordinary "securities" when it comes to SIPC protection (i.e. they offer no additional safety in cas...

Regarding VTV (value index) and VUG (growth index), starting from this point in time, is it expected that the long-term returns will be about equal? If you were to bet on out-performance of one or the other, which would you choose and why? (I'm aware of the benefits of owning both via VTI or similar. Just curious about others' expectations.)

Thanks for the analysis, everyone.

grabiner wrote: ↑Sun Mar 12, 2023 1:24 pm Limited-Term Tax-Exempt: 3.08%

iim7V7IM7 wrote: ↑Sun Mar 12, 2023 1:28 pm Vanguard Limited Term Tax Exempt has a 2.7% yield.

Is the apparent discrepancy due to SEC vs distribution yield? What yield should we expect from this fund over the next year?

AnnetteLouisan wrote: ↑Sun Mar 12, 2023 10:11 am Similarly if I have some treasuries at Schwab or comparable brokerage, plus some FSKAX in an IRA and some VTI (total under 300k) and my brokerage goes under,

1. are my investments safe (other than loss of value), and

2. are these 3 investments different degrees of safe because one is held in an IRA, two in taxable and of those, some are treasuries?

See here:

Kevin M wrote: ↑Sun Dec 11, 2022 7:23 pm Again, there is nothing special about treasury MM or individual Treasuries (bills, notes, bonds, TIPS, STRIPS) with respect to SIPC insurance. They are covered the same as any other security.

Harmanic wrote: ↑Sun Mar 12, 2023 12:28 pm For instance, "But everyone was blind to 9/11, the 2008 financial crisis, and Covid-19 – the three risks that were both massive and unpredictable." This is false, false, false. Experts predicted each event and the consequences, but they were ignored, ignored, ignored.

Is the impending recession also in this category (widely predicted, much ignored)?

robertfromtx wrote: ↑Sun Mar 12, 2023 12:36 pm I've been a long term investor in a single small bank. ... Having access to management or a director is also helpful.

I thought this was frowned upon.

anon_investor wrote: ↑Sat Mar 11, 2023 1:26 pm

zero_coupon wrote: ↑Sat Mar 11, 2023 12:54 pm

anon_investor wrote: ↑Sat Mar 11, 2023 11:41 am I know people hate Treasury Direct, but if you have too much cash, autorolling T-Bills st Treasury Direct avoids bank and brolerage failure risk.

Yeah, but if your money gets stolen you have no recourse. TD offers no guarantee to make you whole.

Has anyone's TD account been hacked?

Not that I'm aware of, but this issue has been discussed:

Kevin M wrote: ↑Sun Dec 11, 2022 7:16 pm Oh yeah, and TD offers no protections at all if your securities are somehow stolen, and for this reason alone, one of the great savings bond champions on this site, Mel L., won't even buy savings bonds at TD.

VictorStarr wrote: ↑Sat Mar 11, 2023 10:04 pm

Droptoptop wrote: ↑Sat Mar 11, 2023 7:24 pm You guys think it makes sense to move from a prime fund with commercial paper to FDLXX until this bank run risk resolves?

On Friday I divided my MM between prime and government money market funds. Before I kept everything in the FZDXX. The difference in yield is just 14 bps but I will sleep better at night.

I guess one advantage of Vanguard is that one doesn't need to delve into prime funds to get good MM yields. At Fidelity, one must use prime to get the best yields.

retired@50 wrote: ↑Sat Mar 11, 2023 12:59 pm

zero_coupon wrote: ↑Sat Mar 11, 2023 12:05 pm
Thank you in advance.

See this thread: viewtopic.php?t=377188

It's been tracking differences in money market funds for a while.

Regards,

Thanks for the reference. I read somewhere that short muni yields are relatively bad right now (compared to taxable instruments of equal duration). Is this true?

anon_investor wrote: ↑Sat Mar 11, 2023 11:41 am I know people hate Treasury Direct, but if you have too much cash, autorolling T-Bills st Treasury Direct avoids bank and brolerage failure risk.

Yeah, but if your money gets stolen you have no recourse. TD offers no guarantee to make you whole.

KellyInBaconville wrote: ↑Fri Mar 10, 2023 7:22 pm I am talking to other people. Hopefully I can get others to wake up.

Tread carefully when advising others what to do with their money. When their investments tank, they will blame you. That said, I suppose it's generally OK to recommend low-cost Target Date funds to people, as such funds require no effort to manage.

Across the range of durations of available national funds, but particularly focusing on money market and short duration bond funds, how much do municipal (tax-exempt) yields differ from taxable yields? (No consideration of taxable-equivalent yield calculations, just looking at raw yields for now.) For example, consider holding short muni funds (e.g. VTES, SUB) vs rolling individual (<2y) treasurys. How much additional yield is available by rolling individual treasurys? Also, on average, lately, how much additional yield is available from taxable money market funds (e.g. VMFXX at Vanguard, FZDXX at Fidelity) vs municipal money market funds (e.g. VUSXX at Vanguard, FZEXX at Fidelity). How does this difference vary over time? Do the municipals...

Here's another simple option:

IRA ($50K, see viewtopic.php?p=7154547):
50% Vanguard Federal Money Market Fund (VMFXX)
50% Vanguard Total Bond Market Index Fund (VBTLX)

Taxable ($175K)
50% Vanguard Federal Money Market Fund (VMFXX)
50% LifeStrategy Moderate Growth Fund (VSMGX) (60% stock / 40% bond)

Each account is equally divided between two funds. As you make withdrawls, just try to nudge each account toward a 50/50 balance between the two funds. No other rebalancing necessary.

Asset allocation is about 23% stocks, 27% bonds, and 50% cash. You may be less likely to panic-sell stocks when they're held in the LifeStrategy Moderate Growth Fund.

Diaperman1 wrote: ↑Wed Mar 08, 2023 4:55 pm For the Total US Stock Market or S&P 500 portions, are you suggesting Vanguard’s ETF’s or MFunds?

I'm not bloom2708, but VTSAX (total stock mutual fund) may be easier to use than VTI (the equivalent ETF).

At this point you could keep 60-80% in the Federal Money Market (Settlement account). No chance of loss and 4+% currently. Then put the other 20-40% in the Total US or S&P 500 index. You could also use the LifeStrategy 80/20 fund for the balance to keep some bond exposure. I would rather see you stay quite conservative at your ages and portfolio size. This seems reasonable. Then again, one can't count on swapping MM for bonds after MM yields drop, as bond yields will likely also have dropped at that point, meaning the bonds will cost more to buy. Are the assets all in a tax-deferred account? If not, when implementing bloom2708's strategy, the 20% allocation to stocks could be kept in a taxable account for improved tax efficiency. If so...

Schwab has a muni ETF with a lower expense ratio SCMB (.03) but it's only a few months old. It can be risky to select a fund with a short history. I am reminded of Fidelity's muni index fund FMBIX, which had some problems tracking its index. For a brief discussion of this, see the quote below, which concerns tax-exempt options available at Fidelity (as compared to Vanguard's offerings). I once started a thread about that topic: https://www.bogleheads.org/forum/viewtopic.php?p=7155440 FMBIX is a new and fairly small (but growing) fund. As of November 30 it had $82.6 million in assets. From the descriptions above, there was a lot of inflows and redemptions in March and April which forced it to buy and sell at inopportune times and harmed its...

Jack FFR1846 wrote: ↑Wed Feb 22, 2023 7:00 am [For DIY approach, buy] ETFs VTI, BND and VEA. Very conservative, easy.

Why VEA instead of VXUS?

invest2bfree wrote: ↑Thu Feb 23, 2023 8:31 am Split the portfolio into three sections-

1. Market Index - (VTI) 1/3rd
2. Dividend Growth (SCHD) 1/3rd
3. Bonds(BND) 1/3rd

nix4me wrote: ↑Thu Feb 23, 2023 10:12 pm 1.5M in VTI
.5M in SCHD
.5M in Tbills/Cash

Much love for SCHD (Dow Jones US Dividend 100) here. I would like to know the rationale. The fund seems to perform well, but why not just use VTV (value index)? I previously asked about SCHD here:
viewtopic.php?t=399140

I did a split after a TLH in 2018 with VTV, VUG and VB and could not be happier with the index choices (and funds). It is very important to understand that CRSP does NOT keep a split percentage between index, but instead uses screens and the relative market cap of the two indices can vary WIDELY over time. This is important when you think about rebalancing. In fact if you are reinvesting dividends, you likely will never rebalance. The split has ranged from 44/56 Growth/Value in 2012 to 62/38 in 2020! It is currently pretty close to even at 48/52. I know how to find the CRSP growth/value and large/small percentages from the PDF files on the CRSP website. Is there any other way? I was also thinking 50/50 VUG/VTV, unrebalanced, would be "...

I'm considering value index funds for use in a tax-advantaged account. To approximate the broad market, a companion growth index allocation will be held in a separate account. This split is already decided, so I'm focusing on fund selection. VTV (follows CRSP Value Index) is the obvious choice, but SCHD (follows Dow Jones US Dividend 100 Index) has piqued my interest. As it contains only 100 stocks, it's less diversified than VTV. However, it has performed well thanks to its selection criteria, which are described in the third post on the following page: https://www.bogleheads.org/forum/viewtopic.php?t=390997&start=50 1. Is there any reason to believe SCHD outperform VTV over the next 5, 10, 20 or more years? 2. Any thoughts on FLCOX (f...

anon_investor wrote: ↑Fri Mar 03, 2023 3:59 pm

zero_coupon wrote: ↑Sat Jan 21, 2023 12:37 am

JSPECO9 wrote: ↑Thu Nov 03, 2022 12:38 pm I recall seeing a thread recently of some folks who got their account stolen from Fidelity this way, but they have the lockdown feature.

Would like to read. Could you provide a link?

I don't think the person from the other thread had the Money Transfer Lockdown feature enabled on their Fidelity account.

I think this is the thread being referenced, the poster was talking about a reddit thread they read:
viewtopic.php?t=381060

Thanks for the reference.

See here:

zero_coupon wrote: ↑Tue Jul 05, 2022 1:13 pm As of March 31, 2022, the CRSP large cap category comprised 87.1% of total market cap. Mid caps are included in this category. The LC index was 46.2% value and 53.8% growth. Thus, one total market approach is

40.3% VVIAX (LCV)
46.8% VIGAX (LCG)
12.9% VSMAX (SC)

You can read up on CRSP methodology for splitting value and growth. The CRSP split results in a growth-tilted market as of March 31, 2022.

As mentioned by others, designation of a company as value or growth requires definition of these terms.

comeinvest wrote: ↑Tue Feb 28, 2023 10:01 pm ...however read the caveats regarding the potential embedded tax liabilities that were pointed out in posts above.

Could you provide an example of how this could play out unfavorably?

Anon9001 wrote: ↑Tue Feb 28, 2023 12:13 pm I think it would probably give similar returns as a US Large-Cap Value Index in the future.

I think so too, but I'm having difficulty seeing past the potential risks. Seems like it should be a great substitute for VTV (value index) with no dividends.

Startled Cat wrote: ↑Mon Feb 27, 2023 11:02 am I expect it to have similar long-term returns to a value index...

Yes, me too. Therefore, couldn't one pair it 50/50 with VUG (growth index) attempting to track the total market, but with lower dividends?

rockstar wrote: ↑Mon Feb 27, 2023 4:58 pm It’s basically owning Apple plus conservative stuff.

Does the Apple component make it less likely to behave smilar to a value index?

Logan Roy wrote: ↑Sat Feb 25, 2023 10:13 am I'm not sure the market's the right benchmark for BRK(?)

Examining the recent past in portfoliovisualizer, it appears that a value index, such as VTV/VVIAX, is a more sensible benchmark.

50/50 growth/value is a decent approximation for total market (e.g. 50 VUG / 50 VTV). Assuming you (anyone) were forced to do so, how would you feel about holding 50 VUG / 50 BRK.B?

Sounds reasonable. Glad you found something that works for you.

As you are using global credit, the following may not apply to you; however, there seems to be a case for avoiding corporate bonds all together:
viewtopic.php?t=383298

One can replicate US corporates by mixing treasurys and stock.

3funder wrote: ↑Wed Feb 22, 2023 12:01 pm The market is still rather overvalued. If it is over (and what do these people know?), it was a pretty ineffective bear market. Color me unimpressed.

secondopinion wrote: ↑Wed Feb 22, 2023 12:59 pm The US still is dominated by “growth” companies; as long as this is still true, it will never be “cheap”. It seemed more like a major correction in 2022 than the typical bear.

Perhaps 2022 was just deflation of the growth bubble, and real "bear" action is yet to come.

I predict a crash of at least moderate degree. The unemployment rate is ridiculously low yet there are too many unfilled jobs. Help wanted signs everywhere. Inflation is only slightly diminished despite eight fed rate increases in the past year. The stock market valuation is high again (21 PE ratio). I'm inclined to agree with this, but it's notoriously difficulty to predict the future reliably. Also, there's no good reason to believe the market's collective "prediction," as reflected by current prices, is inferior to predictions of individuals, right? ... you just know there's going to be a pretty big switch up as far as composition/yield [of Agg bond] in a few years. There has to be when half of the fund is currently 0-5 year d...

er999 wrote: ↑Sat Feb 25, 2023 6:11 pm Usually markets crashes are thought of as a great time to buy stocks on sale; should we feel the same about buying individual tips? Or is this 2008 and 2020 tips decline in market crashes an aberration and not to be expected?

I don't believe we can predict how TIPS prices will behave during the next stock market crash. Perhaps buy some TIPS now, while the real yields are still positive?

Forecasting real interest rates is no easier than forecasting stock prices. However, in a future stock crash, it wouldn't be a surprise to observe TIPS behaving in a manner similar to how they've behaved during prior market turmoil. I don't think anyone has the ability to predict this, however.

It's not clear to me whether the goal is to replicate total stock market or to get a small cap value tilt. Replicate total stock market. If the goal is really just to replicate the total stock market--really, to cut tracking error from it--it's not clear that there should be a focus on the small cap value space. There is minimal evidence that total stock indices behave any differently from large cap indices over time; the small cap premium has mostly disappeared since 1980, and the total stock index has a low enough exposure to small caps that even if a premium materialized again, it would be insignificant. OP, consider the following data from PV: https://www.portfoliovisualizer.com/backtest-asset-class-allocation?s=y&mode=1&timePe...