I've been continually frustrated with Vanguard's exchange screen. It seems overly complicated for annual portfolio rebalancing. As a result, I have to plan exactly how to sequence and allocate transfers between individual funds.
This makes rebalancing more difficult. Although this may be good for Vanguard to keep costs down, I feel this ignores one of our most fundamental customer requirements. What's worse, I'd imagine many investors see the complexity and shy away from actually rebalancing.
Is anyone else frustrated with rebalancing funds at Vanguard?
Search found 54 matches
- Thu Apr 29, 2010 12:38 pm
- Forum: Personal Investments
- Topic: POLL: Vanguard rebalancing/exchange screen
- Replies: 15
- Views: 2393
- Wed Mar 31, 2010 8:22 am
- Forum: Personal Consumer Issues
- Topic: Coffee mugs.
- Replies: 7
- Views: 1988
Kodak Gallery
I've used Kodak Gallery for a long time and am very happy with the quality and pricing.
It's real easy using the dock. Just placed an order for 300 prints a few weeks ago. Easy breezy!
It's real easy using the dock. Just placed an order for 300 prints a few weeks ago. Easy breezy!
- Tue Mar 30, 2010 2:04 pm
- Forum: Investing - Theory, News & General
- Topic: Supreme Court rules on mutual fund fees and fiduciary duty
- Replies: 27
- Views: 4191
Re: Supreme Court rules on mutual fund fees and fiduciary du
The supreme court has issued its opinion in Jones v. Harris Associates. This is the case where John Bogle submitted an amicus brief. The opinion is http://www.supremecourt.gov/opinions/09pdf/08-586.pdf Looks like a mixed bag; they overturned a lower court ruling requiring plaintiffs to demonstrate that an advisor had to mislead directors. The most relevant part to us seems to be: The Court resolves the parties’ disagreements on several important questions. First, since the Act requires consideration of all relevant factors, §80a–35(b)(2), courts must give comparisons between the fees an investment adviser charges a captive mutual fund and the fees it charges its independent clients the weight they merit in light of the similarities and dif...
- Tue Mar 30, 2010 2:04 pm
- Forum: Investing - Theory, News & General
- Topic: Mutual funds win while we lose
- Replies: 4
- Views: 1422
Mutual funds win while we lose
Amazing. It is truly horrific that investors, as CAPTIVE customers of these products, are not guaranteed some basic protections.
Either free us from captivity and enable real competition or at least give us some basic protection.
That's very frustrating!
Either free us from captivity and enable real competition or at least give us some basic protection.
That's very frustrating!
- Fri Mar 26, 2010 11:48 am
- Forum: Investing - Theory, News & General
- Topic: Asset Class Performance of Welfare States
- Replies: 5
- Views: 1189
Report results
In before lock :lol: But here's a useful link to compare returns across countries: http://emagazine.credit-suisse.com/app/_customtags/download_tracker.cfm?logged=true&dom=emagazine.credit-suisse.com&doc=/data/_product_documents/_shop/276532/credit_suisse_global_investment_yearbook_2010.pdf Using the report above: US equity premium vs bonds [1900-2009] = 4.2% US equity premium vs bills [1900-2009] = 5.2% Europe equity premium vs bonds [1900-2009] = 3.9% Europe equity premium vs bills [1900-2009] = 3.8% World ex-US equity premium vs bonds [1900-2009] = 3.8% World ex-US equity premium vs bills [1900-2009] = 4.0% From those results, the average relative delta of ~0.3% of the equity risk premium: equity premium vs bonds [1900-2009] = 0....
- Tue Feb 02, 2010 9:30 pm
- Forum: Personal Investments
- Topic: POLL : % of High Yield in your total portfolio ?
- Replies: 52
- Views: 9190
Ditto for me. Not in my portfolio but voted too quickly. I expected the choice sequence to logically flow from not own to maximum threshold.Sheepdog wrote:Same goes for me also. And I am taking income for spending in retirement. Hi Yield does not meet my needs.Mel Lindauer wrote:Same goes for me.gkaplan wrote:I voted for the first choice (0-1%). Had I scrolled down the list before casting my vote, however, I would have voted for the last choice (Would not own.)
Jim
- Thu Jan 28, 2010 9:38 am
- Forum: Investing - Theory, News & General
- Topic: No Need For Stocks??
- Replies: 23
- Views: 4811
Re: No Need For Stocks??
Chris, thank you very much for the clear & concise reply! I will definitely do that when I retire for the TIPS ladder portion of my investments.fishnskiguy wrote: As others have pointed out, you cannot have an IRA at Treasury Direct.
What you can do is:
1. Transfer 401K to an IRA.
2. Move the IRA to Vanguard.
3. Open a brokerage account within the IRA.
4. Buy TIPS through the brokerage account. If your IRA is large enough to make Voyager status, you can purchase TIPS at auction at no cost.
Chris
I didn't know about the Voyager perk of buying TIPS at auction at no cost. That's pretty amazing. I wasn't sure if the laddering would be cost prohibitive due to transaction costs at a brokerage.
Thanks again!!!
Eric
- Sun Jan 24, 2010 3:01 pm
- Forum: Investing - Theory, News & General
- Topic: Bonds at the core of your portfolio -- regardless of age?
- Replies: 26
- Views: 5181
Re: Unable to vote
Forgot to log in. My apologies!Doc wrote:Did you log in?Eric White wrote:Snowjob,
I was looking forward to voting, but it looks closed. Can you reopen the poll and set it to not age out?
Thanks!
Cheers,
Eric White
- Sun Jan 24, 2010 2:52 pm
- Forum: Investing - Theory, News & General
- Topic: No Need For Stocks??
- Replies: 23
- Views: 4811
Re: No Need For Stocks??
I would appreciate hearing what others think about this issue. What might one's investment strategy without stocks look like? (I get the obvious options eg bonds, TIPS, CD's, etc.) But a coherent strategy. How about: 1) minus pension + SS away from needed income. 2) buy inflation adjusted annuity to make up difference. 3) put rest in TIPS how's that? Brilliant! Closely matches the strategy I offered: http://bobsfiles.home.att.net/misc/safer_plan_small.png Source: http://bobsfiles.home.att.net/SaferPlan2.html Bob, this is a very naive question, but how would I set up a TIPS ladder in a tax-deferred account? Would you be able to take money out of a 401k/403b and transfer it to Treasury Direct as an IRA? I'd love to do that when I retire, but...
- Sun Jan 24, 2010 2:23 pm
- Forum: Investing - Theory, News & General
- Topic: Bonds at the core of your portfolio -- regardless of age?
- Replies: 26
- Views: 5181
Unable to vote
Snowjob,
I was looking forward to voting, but it looks closed. Can you reopen the poll and set it to not age out?
Thanks!
Cheers,
Eric White
I was looking forward to voting, but it looks closed. Can you reopen the poll and set it to not age out?
Thanks!
Cheers,
Eric White
- Fri Jan 22, 2010 3:51 pm
- Forum: Investing - Theory, News & General
- Topic: New Change--Vanguard Subsequent Investment Minimum ($1)
- Replies: 44
- Views: 10578
$20/day for Roth
If I round up to $20/day for my Roth contributions, will it automatically truncate my contributions at the end of the year when I reach $5k or will it keep contributing above the limit?
- Thu Jan 21, 2010 9:11 pm
- Forum: Personal Investments
- Topic: POLL: Fixed Asset Allocation
- Replies: 14
- Views: 2873
Opportunity costs of credit quality tilting
I'm pretty confident I don't want to take duration risk. It seems like many Bogleheads are hesitant to go long due to repricing risk. If people have arguments in favor of taking the duration risk inherent in TBM, I'd love to hear them! The issue that made me consider requesting this poll was a divergence I saw in 2009 results from credit quality tilting. I thought I was doing the prudent thing when I set up my fixed allocation for the first time last year to use Treasuries instead of TBM. I thought it would help me minimize credit quality risk due to inclusion of corporates in TBM. The flipside of this was outperformance in corporates and underperformance in Treasuries. TBM sailed through this fine since it didn't tilt. I don't want to chas...
- Thu Jan 21, 2010 9:00 pm
- Forum: Personal Investments
- Topic: POLL: Fixed Asset Allocation
- Replies: 14
- Views: 2873
Initial poll results
Thanks everybody for voting your allocation strategies. I know it was a little tough to comprehend subtle differences, but I wanted to make it as comprehensive in scope as possible (e.g. including inflation protection) without proliferating the options too much (e.g. qualifying inflation protection secondary effects on credit quality). Basically, I wanted to understand if people were moving away from TBM directionally how they were moving. I'm amazed at the trimodal response. I think I can understand the no tilt & triple tilt. I'm intrigued at the competitiveness of the inflation tilt only option. Can posters from each strategy post some reasons why that allocation strategy is the best? I'd love to see some rational explanations/backtes...
- Thu Jan 21, 2010 4:06 pm
- Forum: Personal Investments
- Topic: POLL: Fixed Asset Allocation
- Replies: 14
- Views: 2873
POLL: Fixed Asset Allocation
I'd like to benchmark Bogleheads for fixed asset allocation strategies. I've seen many different scenarios of the strategies below in various commonly-read Boglehead books and threads, but I don't believe I've seen any hard voting for the most common strategy in use from forum members. Tilt Types: Duration Tilt = short and/or intermediate allocation larger than long allocation Credit Quality Tilt = high quality allocation larger than low quality allocation; i.e. Treasuries preferred over corporates Inflation Protection Tilt = inflation protected allocation larger than nominal allocation To limit options to a reasonable number, I'm excluding tactics of whether tilts should be executed via Total Bond Market Index + weights or if they should b...
- Thu Jan 21, 2010 12:32 pm
- Forum: Personal Investments
- Topic: Inflation Protected outperformance in 2009
- Replies: 4
- Views: 1211
Inflation Protected outperformance in 2009
During my annual rebalancing, I noticed significant outperformance of inflation protected relative to short and intermediate term funds within my fixed allocations: Vanguard Inflation-Protected Securities Fund Investor Shares (VIPSX) +10.8% Short-Term Treasury (VFISX) +1.44% Intermediate-Term Treasury (VFITX) -1.69% I would like to understand the root cause of this overperformance and whether VIPSX will be more robust than VFISX & VFITX moving forward. However, I don't want to chase performance and have an unreasonable asset allocation on the fixed side. If it is truly more robust to pricing and duration risk, I'm considering overweighting relative to short & intermediate. Can other forum members weigh in whether I should overweight...
- Wed Aug 12, 2009 11:07 am
- Forum: Personal Consumer Issues
- Topic: 230 mpg!
- Replies: 59
- Views: 8867
Under the "230mpg" hood
I'm a pretty big Volt supporter because I think Extended Range Electric Vehicles (E-REV) are an important bridge to the future. Most importantly, they tackle the largest problem for lower lifecycle cost and emissions vehicles: battery cost. Batteries run ~$1000/kwh. The Volt reduces the range to 40 miles with a 16 kwh battery to keep the cost out of the stratoshere (~$16k). As a result, to reduce range anxiety, they add the combustion engine. Nice to have for extended trips after work (e.g. food shopping), long trips, etc. The problem with full electric vehicles is that to minimize range anxiety they have to have a beefy battery (>40 kwh) and subsequently large price tag (>$60k) or battery leasing, all of which means the lifecycle cost is u...
- Wed Aug 05, 2009 12:00 pm
- Forum: Personal Consumer Issues
- Topic: Battery Powered Lawn Equipment? Recs???
- Replies: 19
- Views: 3558
Black & Decker set
I've owned the Black & Decker set now for almost 4 years. It came with three batteries and a wall charger for all three. It includes a blower, string trimmer, and hedge clipper. Works awesome. Very reasonable price if you buy it as a set instead of separately. I bought mine through Amazon, although I'm not sure if the newer sets come with three batteries & the triple charger: http://www.amazon.com/Black-Decker-CCC3000-Cordless-Electric/dp/B00023RSUA/ref=pd_cp_hi_1 I did replace the three batteries after three years of real serious use. At $35 each, it was a little over $100. So, I figure $33/year for batteries isn't a bad tradeoff for the convenience and time savings of no maintenance, reduced noise, and reduced pollution. I liked t...
- Tue Jun 09, 2009 10:04 am
- Forum: Personal Consumer Issues
- Topic: Cordless Lawn Mowers
- Replies: 13
- Views: 2857
Black & Decker is a great machine
I've had the Black & Decker cordless battery electric mower now for the second season. I have a 0.5 acre lot with significant grass and thus dove in for the B&D over the Neuton due to the larger cutting swath. My parents have a Neuton and love it for their smaller lot (<0.25 acres). If I mow weekly, I can do it all in one pass. However, if it goes much more than 8 days, it requires multiple attempts because the battery doesn't last long enough. The only other problem is mulching in the fall, which usually takes 2 attempts. Overall, however, there are MANY benefits to using battery over gas: - Maintenance hassles are a lot less (oil changes, spark plug checks) - Don't breathe in fumes - Avoid trips to fill up gas - Avoid trips to the...
- Sun Apr 06, 2008 2:53 pm
- Forum: Personal Consumer Issues
- Topic: Strategy Games
- Replies: 32
- Views: 8913
I wholeheartedly agree with Cyberbob's recommendations.CyberBob wrote:Try these too (all are turn-based games, can be played multiplayer online, and are open-source):Bob
- TripleA - Axis and Allies war-game clone.
- The Battle for Wesnoth - Fantasy strategy game (sort of Dungeons and Dragons-like).
- FreeOrion - Space-colonization.
- FreeCiv - Take a civilization from the stone age to the space age.
I'm a massive Axis & Allies boardgame fan. It's tough to play with family & friends scattered across the country though. TripleA is a decent substitute. I've personally had trouble with it in Vista however.
Good luck!
Cheers,
Eric
- Sat Feb 16, 2008 8:05 pm
- Forum: Personal Investments
- Topic: Break out emerging markets into regions?
- Replies: 0
- Views: 1065
Break out emerging markets into regions?
I'm at the early stages of establishing my asset allocation with the help of ETFs. Reading Rick Ferri's ETF book, I noticed that there is an opportunity to break out emerging marketing from a single WW offering into multiple regions. The benefit for this approach would be that I could capture a rebalancing effect similar to breaking out foreign between regions (developed Asia, developed Europe). If memory serves me correctly, both Bernstein via Four Pillars and Swedroe via Winning Investment Strategy advocate this approach for deveoped foreign markets. Although there are parallels with the developed foreign markets breakout, differences include: - Higher costs (~0.3% higher from VWO) - Small relative effect on overall portfolio (only one ac...
- Sun Feb 03, 2008 1:30 pm
- Forum: Investing - Theory, News & General
- Topic: Poll: 401K Match
- Replies: 99
- Views: 23468
First 3%
My employer only matches up to $3k max.
My wife's employer only matches up to $4k max.
Thanks.
-Eric
My wife's employer only matches up to $4k max.
Thanks.
-Eric
- Fri Feb 01, 2008 12:36 am
- Forum: Investing - Theory, News & General
- Topic: The Great Debate!
- Replies: 210
- Views: 44242
Followup reading
Pete & Larry,
It looks like I have a LOT of reading ahead to catch up to both of you.
I'll try to repost this weekend when I have completed some of the background PMPT & commodities reading so I can provide meaningful responses.
Thanks for your correspondence this evening. I really appreciated it!!!
Sincerely,
Eric
It looks like I have a LOT of reading ahead to catch up to both of you.
I'll try to repost this weekend when I have completed some of the background PMPT & commodities reading so I can provide meaningful responses.
Thanks for your correspondence this evening. I really appreciated it!!!
Sincerely,
Eric
- Thu Jan 31, 2008 11:49 pm
- Forum: Investing - Theory, News & General
- Topic: The Great Debate!
- Replies: 210
- Views: 44242
Blocking & tackling...
Pete, I'm the first to say how much of an amateur I am at understanding these dynamics. But I do know from my supply chain design analysis days that there is a significant difference between theoretical analysis and fact-based analysis. Theory is great; reality is better. :wink: 1.) Backtest time horizon is 23 years (1985-2007). I was stuck using this smaller horizon instead of 36 years (1972-2007) due to the lack of alternative asset subclass returns available in the longer horizon. Simbam, TrevH, and the team have been very honest and transparent about their inputs and assumptions behind this model. They would rather exclude data than corrupt it, which I appreciate. 23 years ain't great, but I'll take it over a theoretical formula anyday!...
- Thu Jan 31, 2008 11:24 pm
- Forum: Investing - Theory, News & General
- Topic: The Great Debate!
- Replies: 210
- Views: 44242
Reference materials
Larry, I haven't had time to research the subject in depth yet, so I appreciate your quick response. I will reserve my judgement on this preliminary data until I finish reading the threads, and read your references. I GOTTA TRAIN UP FOR THE GREAT DEBATE! Don't worry; I'll still be putting your book on Amazon pre-order regardless of how dry the papers may be. :lol: I'm trying to dig up the reference from the other several threads on the subject. Would you suggest I proceed in the following order? 1.) Ibbotson Associates, “Strategic Asset Allocation and Commodities,” March 2006 2.) Gary Gorton and K. Geert Rouwenhorst, “Facts and Fantasies About Commodity Futures,” Financial Analysts Journal (March/April 2006). 3.) Erb and Harvey paper which ...
- Thu Jan 31, 2008 10:40 pm
- Forum: Investing - Theory, News & General
- Topic: The Great Debate!
- Replies: 210
- Views: 44242
Initial review in anticipation of the big match
Alright folks. Just like in all the other threads, I can only read so many opinions without data before I get a little bug-eyed. :shock: Last time I looked I thought this was the VANGUARD DIEHARDS forum. WOOT! 8) Here is the current Simba/TrevH asset allocation backtest file with candidate alternative asset subclass portfolio results: http://groups.google.com/group/vanguard-diehards/web/Backtest-Portfolio-returns-rev7d+with+alternative+asset+class+results%2C+v4.xls ASSUMPTIONS: - Slice & Dice - Value Tilt - Alternative Asset Subclass = 10% of overall portfolio (excluding REITs) ALTERNATIVE ASSET SUBCLASS PORTFOLIO CANDIDATES: A = 10% Commodities (PCRIX) B = 10% Energy Fund (VGENX) C = 10% Health Care Fund (VGHCX) D = 10% Precious Metals...
- Thu Jan 31, 2008 7:09 pm
- Forum: Investing - Theory, News & General
- Topic: The Great Debate!
- Replies: 210
- Views: 44242
LET THE GAMES BEGIN!
I'm definitely planning on polling the forum after the debate.
Here are my votes before the debate (I still need to do more thread reviews too):
Commodity Inclusion in Asset Allocation: NO (Rick 1, Larry 0)
Bond Asset Subclass Diversification: YES (Rick 1, Larry 0)
Portfolio Mirroring: YES (Rick 1, Larry 0)
At round 0, my grand total is:
Rick 3, Larry 0
Is there a difference in positions on Larry's tactical bond allocation as well? I'm not as well up to speed on that subject.
LET THE GAMES BEGIN!
Cheers,
Eric
Here are my votes before the debate (I still need to do more thread reviews too):
Commodity Inclusion in Asset Allocation: NO (Rick 1, Larry 0)
Bond Asset Subclass Diversification: YES (Rick 1, Larry 0)
Portfolio Mirroring: YES (Rick 1, Larry 0)
At round 0, my grand total is:
Rick 3, Larry 0
Is there a difference in positions on Larry's tactical bond allocation as well? I'm not as well up to speed on that subject.
LET THE GAMES BEGIN!
Cheers,
Eric
- Tue Jan 29, 2008 12:22 am
- Forum: Investing - Theory, News & General
- Topic: Equity style rotation
- Replies: 550
- Views: 186051
Backtest failed; SR needs to SHOW ME THE MONEY!
Bogleheads, I'm a numbers guy. I find these hypothetical discussions and returns bragging about as exciting as my college humanities classes. So, I ran a backtest to...SHOW ME THE MONEY! Given that TrevH & Simba are our uber-asset allocation backtesting gurus, I "borrowed" the asset subclass data from the most recent asset allocation spreadsheet (Backtest-Portfolio-returns-rev7d.xls) as the foundation. Caveats/Limitations: 1.) This data is ANNUAL. This backtest cannot determine sensitivity to FREQUENCY (e.g. 1 year vs. 3 month vs. 1 mo). 2.) This data uses index fund actual returns and limits returns from hypothetical indexes. It excludes hot active management fund returns and therefore excludes management excess returns / &qu...
- Fri Jan 18, 2008 12:43 pm
- Forum: Investing - Theory, News & General
- Topic: how are you going to spend your 407€ from Uncle Ben?
- Replies: 106
- Views: 21422
$500 may be high; $333 by my calculations
Here are my rough calculations:
===================
$150,000,000,000 stimulus to both businesses and individuals as a whole
$100,000,000,000 stimulus to individuals as a whole
300,000,000 individuals
$333 stimulus to an individual
$50,000,000,000 stimulus to businesses as a whole
n/a for individual rebate
===================
Although 300 million individuals are not all taxpayers (e.g. young, undocumented, etc.), it's probably ballpark $333/person before taxes. That may not go that far...
===================
$150,000,000,000 stimulus to both businesses and individuals as a whole
$100,000,000,000 stimulus to individuals as a whole
300,000,000 individuals
$333 stimulus to an individual
$50,000,000,000 stimulus to businesses as a whole
n/a for individual rebate
===================
Although 300 million individuals are not all taxpayers (e.g. young, undocumented, etc.), it's probably ballpark $333/person before taxes. That may not go that far...
- Fri Jan 18, 2008 12:33 pm
- Forum: Investing - Theory, News & General
- Topic: Value Averagers - How much dry powder you got left?
- Replies: 18
- Views: 5337
Got it!
oneleaf,
Got it. That makes a lot of sense. I was dreading preparing that monster of a spreadsheet that implemented both VA and AA rebalancing. Make the AA rebalancing static and inject cash per the VA path requirements.
I need to update my contribution definitions next. Thanks again!
Cheers,
Eric
Got it. That makes a lot of sense. I was dreading preparing that monster of a spreadsheet that implemented both VA and AA rebalancing. Make the AA rebalancing static and inject cash per the VA path requirements.
I need to update my contribution definitions next. Thanks again!
Cheers,
Eric
- Fri Jan 18, 2008 12:28 pm
- Forum: Investing - Theory, News & General
- Topic: [poll] Which rebalancing strategy do you use? And why?
- Replies: 19
- Views: 6048
Any reference materials with comparisons?
Can anyone refer me to any reference materials (e.g. journal articles, academic papers, etc.) that do a decent job comparing all these strategies?
Most analysis I have seen only looks at time by itself but does not properly compare the strategies. The VA book seems to only compare VA with time-based rebalancing. Given that the majority of Bogleheads use limits only or contributions only, I would like to really understand this substantial difference.
Cheers,
Eric
Most analysis I have seen only looks at time by itself but does not properly compare the strategies. The VA book seems to only compare VA with time-based rebalancing. Given that the majority of Bogleheads use limits only or contributions only, I would like to really understand this substantial difference.
Cheers,
Eric
- Thu Jan 17, 2008 11:50 pm
- Forum: Investing - Theory, News & General
- Topic: Value Averagers - How much dry powder you got left?
- Replies: 18
- Views: 5337
5% cash initial starting point
oneleaf,
Thanks for your data point of 5% starting cash. I actually targeted that in my AA, so I hope I'm ready...
Now I just need to setup the Excel file for tracking and execution. I'll have to see if the file provided with the book is very easily expandable for multiple accounts with slice-n-dice portfolios. Any advice is appreciated.
Thanks again!
-Eric
Thanks for your data point of 5% starting cash. I actually targeted that in my AA, so I hope I'm ready...
Now I just need to setup the Excel file for tracking and execution. I'll have to see if the file provided with the book is very easily expandable for multiple accounts with slice-n-dice portfolios. Any advice is appreciated.
Thanks again!
-Eric
- Thu Jan 17, 2008 10:50 pm
- Forum: Investing - Theory, News & General
- Topic: [poll] Which rebalancing strategy do you use? And why?
- Replies: 19
- Views: 6048
[poll] Which rebalancing strategy do you use? And why?
I would like to understand how the "composite Boglehead" deals with rebalancing.
I would also like to understand the tradeoffs between the strategies. Please explain why you use the strategy you do and your perceived advantages/disadvantages of the competing strategies.
Thanks!
-Eric White
I would also like to understand the tradeoffs between the strategies. Please explain why you use the strategy you do and your perceived advantages/disadvantages of the competing strategies.
Thanks!
-Eric White
- Thu Jan 17, 2008 10:12 pm
- Forum: Investing - Theory, News & General
- Topic: Value Averagers - How much dry powder you got left?
- Replies: 18
- Views: 5337
Finally close to target asset allocation; VAing soon
I finally got all our accounts close to my target asset allocation. I expect to start a value averaging process soon.
I read the Value Averaging book but am a little unclear about how to properly set my initial cash level. Any rules of thumb or references you guys can give me? I've been worried about how to PLAN this since I'm early in accumulation and do not have a larged allocation to fixed as a result yet. It seems like you're screwed at the beginning because of a low fixed allocation (a.k.a. not much powder to start) and it seems like you're also screwed at the end because of the large swings inherent in a large portfolio (a.k.a. not enough powder to fight the whole Spanish armada).
Thanks!
-Eric White
I read the Value Averaging book but am a little unclear about how to properly set my initial cash level. Any rules of thumb or references you guys can give me? I've been worried about how to PLAN this since I'm early in accumulation and do not have a larged allocation to fixed as a result yet. It seems like you're screwed at the beginning because of a low fixed allocation (a.k.a. not much powder to start) and it seems like you're also screwed at the end because of the large swings inherent in a large portfolio (a.k.a. not enough powder to fight the whole Spanish armada).
Thanks!
-Eric White
- Thu Jan 17, 2008 10:03 pm
- Forum: Personal Investments
- Topic: Refinance a 30 yr. mortgage to 15 yr. if paying off soon?
- Replies: 38
- Views: 22346
Same situation; refinanced from 30 year to a 10 year fixed
I was in the same situation ~2 years ago. Tax deferred accounts maxed (401k, 403b, IRAs), 529 matching tax deferral maxed ($10,000 in NYS), emergency fund funded. From there, your only realistic options are a taxable account, mortgage principal payments, or refi. When you look at interest-to-total payment ratio charts of a 30 year fixed loan, it's pretty mindblowing. The opportunity is just tremendous when you compare it to a 10 or 15 year fixed chart. Although you get the tax benefit for that interest you're paying with the 30 year, you're still paying at least 60% of that interest every month. And at the worst possible part of that curve. The NPV of a principal-only payment is horrible for a 30 year mortgage because the future value of mo...
- Thu Dec 13, 2007 8:24 pm
- Forum: Investing - Theory, News & General
- Topic: Rick Ferri's ETF Book Is Shipping
- Replies: 36
- Views: 9233
Prepurchased copy arrived and started reading
My prepurchased copy from Amazon arrived and I've been reading it for a few days now. A nice surprise with the prepurchase, actually, since I've been so buried with work.
Rick, I'm up to the point on the development growth of the offerings. I would love to understand more the effect of the 1987 crash on momentum behind the SEC's decision. It seemed like it was simply mentioned without much background; maybe it was cut as an editorial style decision.
Since I'm a younger investor and was not investing yet, I don't understand the dynamics of the 1987 crash the way most of my Boglehead peers do!
Thanks!
-Eric White
Rick, I'm up to the point on the development growth of the offerings. I would love to understand more the effect of the 1987 crash on momentum behind the SEC's decision. It seemed like it was simply mentioned without much background; maybe it was cut as an editorial style decision.
Since I'm a younger investor and was not investing yet, I don't understand the dynamics of the 1987 crash the way most of my Boglehead peers do!
Thanks!
-Eric White
- Tue Nov 13, 2007 8:42 pm
- Forum: Investing - Theory, News & General
- Topic: Buying the dips: neither good nor bad, it seems to me
- Replies: 71
- Views: 17554
Apology to grayfox; new question of "buying on yield sp
grayfox, Unfortunately, this strategy does sound familiar. It sounds to me like P/E market timing. I'm sure other Diehards on this forum can provide Monte Carlo stress-tested results for that backtest, and it ain't pretty.Embarassed Actually what I had in mind was the TIPS strategy proposed by one of the highly respected authors that posts here. That is why I used 2.5% and the current 1.8% which was the 10-Year TIPS rate earlier today. You know, buy TIPS above 2.5 and sell below 1.5. Grayfox, Now that I have a little background, I think I may be starting to understand the trajectory of the response. I have not read the TIPs/Swedroe thread yet, so I cannot honestly comment on it until I understand it. If you can respond with a link to the t...
- Tue Nov 13, 2007 8:08 pm
- Forum: Investing - Theory, News & General
- Topic: Buying the dips: neither good nor bad, it seems to me
- Replies: 71
- Views: 17554
Lack of constructive posts is getting tiresome
This "strategy" is ridiculous. The only way it works is if there is a short-term mean reversion effect present in the markets. History says there is no such exploitable effect. The reason investing on the first of every month is substantially different than investing at the end of every month is that the first strategy will have each dollar in the market for exactly one month longer. The expectation of investing for one month is not trivial. To properly backtest this strategy, you must have the lump summers invest at the beginning of every month, not the end. If they invest at the end, you should expect the dippers to win, simply because they invest earlier on average, not due to any higher returns caused by buying on dips. Pleas...
- Tue Nov 13, 2007 7:42 pm
- Forum: Investing - Theory, News & General
- Topic: Buying the dips: neither good nor bad, it seems to me
- Replies: 71
- Views: 17554
Looking for constructive strategy testing
It isn't accurate to have DCA at the end of the month be the normal strategy. If the money is available at any point during the month then you would invest it at the beginning. Which is why your "invest the first of the month" wins--investing earlier is better most of the time. BINGO! That is exactly what I was thinking. This comment seems to be being ignored but it is important. It makes the study completely invalid IMO. The discussion was about someone who invest as they get the money or someone who WAITS for a dip. The DCA will invest their money sooner not at the end of the month. I can't speak for others, but the scenario I have in mind is that the investor is taking money out of his emergency fund to invest when a dip occur...
- Tue Nov 13, 2007 8:40 am
- Forum: Investing - Theory, News & General
- Topic: Buying the dips: neither good nor bad, it seems to me
- Replies: 71
- Views: 17554
My pleasure
livesoft,
My pleasure! I was surprised by the data. I expected buy on dips to be more effective. Goes to show that intuition needs to be validated with data.
It makes me wonder if my confidence in value averaging needs confirmation as well. Of course, I'm stuck in paralysis with regard to value averaging due to this fear. Apparently only DCA'ing and staying fully invested was the appropriate first response.
Cheers,
Eric
My pleasure! I was surprised by the data. I expected buy on dips to be more effective. Goes to show that intuition needs to be validated with data.
It makes me wonder if my confidence in value averaging needs confirmation as well. Of course, I'm stuck in paralysis with regard to value averaging due to this fear. Apparently only DCA'ing and staying fully invested was the appropriate first response.
Cheers,
Eric
- Mon Nov 12, 2007 11:30 pm
- Forum: Investing - Theory, News & General
- Topic: Buying the dips: neither good nor bad, it seems to me
- Replies: 71
- Views: 17554
Buying on Dips backtest using S&P500
Hey everybody, I took a previous poster's advice and took a crack at backtesting buying on dips. Here's the file: Buying on Dips backtest using S&P500, updated 2007-11-12, v5 with expanded thresholds Assumptions: - Monthly DCA at end of month - DCA at different time frequencies not investigated (e.g. biweekly) - Dip threshold = 1.5% (see expanded results for other thresholds) - Can only buy once per month on a dip; this early opportunity buy prevents standard monthly DCA buy - Daily data pulled from Yahoo Financial; only available through 1/2/62 - Does not consider other asset classes (e.g. fixed, stable value, REITs, etc.) or equity subclasses (e.g. LV, MB, MV, SB, SV, UB, UV, commodities, etc.) - History only provides us one (1) seed ...
- Thu May 31, 2007 11:05 pm
- Forum: Personal Finance (Not Investing)
- Topic: Peak Oil Poll
- Replies: 47
- Views: 21465
Peak Oil Poll
I just finished reading a book on Peak Oil and am interested in adding another dimension to the characteristics of a typical diehard: if we think Peak Oil exists and when it will occur.
Please note that I am not providing a response that it does not exist. I do not want to conflate this question with whether alternate sources are feasible and/or likely. I have left a final option for this response to keep it straightforward based on creation and usage rates.
Depending on the results, follow on poll(s) may look at:
- expected market impacts
- investment strategies
- expected successful technologies
Please note that I am not providing a response that it does not exist. I do not want to conflate this question with whether alternate sources are feasible and/or likely. I have left a final option for this response to keep it straightforward based on creation and usage rates.
Depending on the results, follow on poll(s) may look at:
- expected market impacts
- investment strategies
- expected successful technologies
- Wed May 30, 2007 1:46 am
- Forum: Investing - Theory, News & General
- Topic: Simba's backtesting spreadsheet [a Bogleheads community project]
- Replies: 1370
- Views: 824525
Cost and Portfolio dataset addition requests
Do fellow Diehards feel it would be useful to add costs for each investment choice (absolute return - cost - inflation = real investor return) and include them in calculations? Sorry if it's already in there... In addition, does anyone have datasets we can add for the following asset subclasses: High Priority: - Stable value/fixed (e.g. GICs, etc. offered via insurance to 401ks/403bs) - Currencies? (to separate currency effect from International, European, Pacific, and EM returns; similar to inflation for separating investor returns) Medium Prioriy: - Int SV (no current Vanguard availability; ETF availability) - EM SV (no current Vanguard availability; future ETF availability) - Int REIT (no current Vanguard availability; mutual fund & ...
- Wed May 30, 2007 1:20 am
- Forum: Investing - Theory, News & General
- Topic: Simba's backtesting spreadsheet [a Bogleheads community project]
- Replies: 1370
- Views: 824525
Error in Returns_85_06 asset allocation links; change plans
Simba: ERROR FOR 85-06 CALCULATIONS: Cell Z3 on sheet Returns_85_06 uses the following formula: =Portfolio!$K$28 Cell AA3 on sheet Returns_85_06 uses the following formula: =Portfolio!$K$30 It looks like Cell AA3 needs to use the formula =Portfolio!$K$29, and the remaining cells in the row need new transposed links. ERROR CHECKING REQUEST Also, if you can eliminate this error check in the calculations and instead use simple 100% summary visual sanity checks, that reduces rework for each rev to enable efficient frontier Excel Solver calculations. I have redone the Solver work twice now and it's been obsoleted a third time. I will not be supporting efficient frontier additions moving forward if we can't find a solution that will be incorporat...
- Wed May 23, 2007 6:41 pm
- Forum: Investing - Theory, News & General
- Topic: Simba's backtesting spreadsheet [a Bogleheads community project]
- Replies: 1370
- Views: 824525
Good to hear
GBS,
That's really good to hear. I need to work on the problem area that was called out last night, but I don't know if that was introduced by my changes or was part of the original Rev5G.
Are you as surprised with some of the results as I am?
Cheers,
Eric
That's really good to hear. I need to work on the problem area that was called out last night, but I don't know if that was introduced by my changes or was part of the original Rev5G.
Are you as surprised with some of the results as I am?
Cheers,
Eric
- Wed May 23, 2007 12:55 pm
- Forum: Investing - Theory, News & General
- Topic: Simba's backtesting spreadsheet [a Bogleheads community project]
- Replies: 1370
- Views: 824525
Using Rev 5G
Simba,
Using Rev 5G.
Can you be more specific as to what's not working? I plan on fixing them tonight per the previous comment, if that's the problem. I don't know if that was a problem in 5G or one of my mods.
-Eric
Using Rev 5G.
Can you be more specific as to what's not working? I plan on fixing them tonight per the previous comment, if that's the problem. I don't know if that was a problem in 5G or one of my mods.
-Eric
- Wed May 23, 2007 2:57 am
- Forum: Investing - Theory, News & General
- Topic: Simba's backtesting spreadsheet [a Bogleheads community project]
- Replies: 1370
- Views: 824525
Efficient frontier results
Hey everybody,
Efficient frontier results for 1972-2006 and 1985-2006 are in the following attachment:
Efficient frontier results, Rev 5G3
I'd be interested in Diehards reactions to the "efficient" allocations. Some were counterintuitive to me (reliance on Emerging Markets over EAFE; extremely low Large Blend / Large Value / Mid Blend allocations; use of Small Value over Microcap; etc.).
Of course, hindsight is 20/20 and efficient frontiers are never static. Next step is to run standard portfolios against the EF and see how everything stacks up!
Cheers,
Eric
Efficient frontier results for 1972-2006 and 1985-2006 are in the following attachment:
Efficient frontier results, Rev 5G3
I'd be interested in Diehards reactions to the "efficient" allocations. Some were counterintuitive to me (reliance on Emerging Markets over EAFE; extremely low Large Blend / Large Value / Mid Blend allocations; use of Small Value over Microcap; etc.).
Of course, hindsight is 20/20 and efficient frontiers are never static. Next step is to run standard portfolios against the EF and see how everything stacks up!
Cheers,
Eric
- Wed May 23, 2007 1:27 am
- Forum: Investing - Theory, News & General
- Topic: Simba's backtesting spreadsheet [a Bogleheads community project]
- Replies: 1370
- Views: 824525
Updated install Excel Solver and efficient frontiers
Hey everybody, Here are the updated instructions to install and use Excel Solver for efficient frontier calculations. These have been updated with the simplified percentage only inputs. 1.) INSTALL MICROSOFT EXCEL SOLVER ADD-IN Go to Tools --> Add-Ins --> select "Solver Add-In" http://vanguard-diehards.googlegroups.com/web/Excel%20Add-Ins.JPG 2.) DOWNLOAD AND OPEN POSTED "EFFICIENT FRONTIER" VERSIONS OF FILES. *** NOTE: Target cell, changing cells, and constraints are dependent on the time horizon and asset allocation options you would like to run. Please use the appropriate file as required. 3.) ON PORTFOLIO WORKSHEET, UPDATE INPUTS -initial investment - $10k currently -max risk (std dev) - 11 currently (similar to couc...
- Wed May 23, 2007 12:54 am
- Forum: Investing - Theory, News & General
- Topic: Simba's backtesting spreadsheet [a Bogleheads community project]
- Replies: 1370
- Views: 824525
No more integers for efficient frontiers!
Hey everybody,
I just found a way to remove the integer requirements for the Solver files. After removing all the Error statements built in, I have successfully driven both files without the integers. It also sped up the calculations significantly.
So here are the new files with percentages!
Rev 5G2 1972-2006 with percentages
Rev 5G2 1985-2006 with percentages
I will take a crack at compiling the data tonight and posting results. Gotta figure out how to append pictures correctly...
I just found a way to remove the integer requirements for the Solver files. After removing all the Error statements built in, I have successfully driven both files without the integers. It also sped up the calculations significantly.
So here are the new files with percentages!
Rev 5G2 1972-2006 with percentages
Rev 5G2 1985-2006 with percentages
I will take a crack at compiling the data tonight and posting results. Gotta figure out how to append pictures correctly...
- Wed May 23, 2007 12:26 am
- Forum: Investing - Theory, News & General
- Topic: Simba's backtesting spreadsheet [a Bogleheads community project]
- Replies: 1370
- Views: 824525
Installing and using Excel Solver for Efficient Frontiers
Hey everybody, I apologize for not having time the other night to post a brief tutorial on how to use Excel Solver to find asset allocation efficient frontiers. *** EDIT: This tutorial has been updated for the simplified percentage-only file versions. Please read below for further details. 1.) INSTALL MICROSOFT EXCEL SOLVER ADD-IN Go to Tools --> Add-Ins --> select "Solver Add-In" http://vanguard-diehards.googlegroups.com/web/Excel%20Add-Ins.JPG 2.) DOWNLOAD AND OPEN POSTED "EFFICIENT FRONTIER" VERSIONS OF FILES. *** NOTE: Target cell, changing cells, and constraints are dependent on the time horizon and asset allocation options you would like to run. Please use the appropriate file as required. 3.) ON PORTFOLIO WORKSHEE...
- Tue May 22, 2007 11:48 pm
- Forum: Investing - Theory, News & General
- Topic: Simba's backtesting spreadsheet [a Bogleheads community project]
- Replies: 1370
- Views: 824525
Updated efficient frontier files (Rev 5G2) posted
Simba, Sorry for the delay. I ran out of time the other night to fully address all the questions. Here are updates I made to your rev 5g files from your Yahoo Group. I did not want to duplicate work again, as this has taken me ~3 hours of testing this evening. Please use these files moving forward. Given that we now have two portolio options, I had to split the Excel Solver inputs into two different files, as Excel Solver does not support different inputs in the same file. Rev 5G2, 1972-2006 Efficient Frontier Rev 5G2, 1985-2006 Efficient Frontier *** EDIT: These files have been simplified with percentages only per a later response. Please read below for further details. I will start another response explaining how to install and use Excel ...