Search found 5478 matches

by Noobvestor
Wed Jun 03, 2020 5:42 am
Forum: Personal Investments
Topic: Total Bond Market Index (or VAIPX) for short term cash needs?
Replies: 14
Views: 1443

Re: Total Bond Market Index (or VAIPX) for short term cash needs?

...How does total bond market index funds behave during market crashes/recessions? For example, if the current market rally fades and there is another 20-30% drop ahead in stocks or if the recession gets markedly worse, is it reasonable to expect Total Bond Market Index to stay stable or rally (e.g...
by Noobvestor
Wed Jun 03, 2020 5:39 am
Forum: Personal Investments
Topic: Changing Assett Allocation
Replies: 13
Views: 1136

Re: Changing Assett Allocation

I'm a bit inclined to take Larimore's advice, which would effectively HALF my allocation towards stocks. However, I know that a big part of the psychology in this for me is seeing that international has underperformed domestic in the last decade. It's clear to me that were I to choose to change my ...
by Noobvestor
Mon Jun 01, 2020 8:34 pm
Forum: Personal Investments
Topic: Total Bond Market Index (or VAIPX) for short term cash needs?
Replies: 14
Views: 1443

Re: Total Bond Market Index (or VAIPX) for short term cash needs?

Money market is the correct pick. The best case isn't amazing for either other option, and worst case if rates rebound could be pretty bad.
by Noobvestor
Mon Jun 01, 2020 1:02 pm
Forum: Personal Investments
Topic: tips in bond allocation
Replies: 5
Views: 434

Re: tips in bond allocation

Usually you have to buy insurance in advance for it to work. If you're going to own 'em, own 'em. See also: Series I savings bonds.
by Noobvestor
Sat May 30, 2020 4:42 am
Forum: Investing - Theory, News & General
Topic: Why is the stock market up? [thread multi-merge]
Replies: 315
Views: 16443

Re: 40m Unemployment Claims - I Don’t Understand Why Markets Seem To Not Care

The question is fraught. The global market is down more. Also, markets don't always price the things we expect them to. Some context: 1) By 'the markets' you must mean US large-caps, because small, value, emerging, developed are are still down significantly. This means you're focused on a particular...
by Noobvestor
Sat May 30, 2020 4:29 am
Forum: Investing - Theory, News & General
Topic: Global Market Portfolio
Replies: 12
Views: 1228

Re: Global Market Portfolio

Thanks for your responses, but what I am looking for is the actual Global Market Portfolio beyond only global stocks and global bonds which can, as you have essentially pointed out, be derived from VT and BNDW. This would include other asset classes: TIPS, Commodities, Real Estate beyond REITS, etc...
by Noobvestor
Fri May 29, 2020 11:47 am
Forum: Investing - Theory, News & General
Topic: I don't understand the case for EE bonds
Replies: 534
Views: 55690

Re: I don't understand the case for EE bonds

Just a few counterpoints on TreasuryDirect difficulties (some have been alluded to by others): 1) It's really easy because I only log in once a year to buy for now and later plan to log in once a year to sell 2) It's really easy, but it does have security layers, so you may have to jot down a few ba...
by Noobvestor
Thu May 28, 2020 2:03 pm
Forum: Personal Investments
Topic: Have you been following your IPS?
Replies: 42
Views: 1903

Re: Have you been following your IPS?

The bigger stuff (stock/bond ratio w/high-quality fixed income), yes. The smaller stuff is wonky due to rebalancing + tax considerations. So my tilts are, well, tilted, and I'm light on TIPS compared to Treasuries. In hindsight, I wonder if I couldn't have spaced things out better across accounts, b...
by Noobvestor
Thu May 28, 2020 1:46 pm
Forum: Investing - Theory, News & General
Topic: Why are 10-20 year treasuries a poor investment now?
Replies: 26
Views: 1642

Re: Why are 10-20 year treasuries a poor investment now?

The problem with long bonds comes when interest rates rise quickly, likely during a time of high inflation. IIRC, real returns of long bonds from 1941-1982 were negative. So don't assume the next 40 years will be like 1982-2020, we could just as easily see the 1941-1982 scenario. But as interest ra...
by Noobvestor
Thu May 28, 2020 9:38 am
Forum: Non-US Investing
Topic: 20-year-old, Investment advice [UK]
Replies: 36
Views: 1415

Re: 20-year-old, Investment advice [UK]

I'd like to walk back my advice a bit (to add UK stocks) and just say I agree with glorat: 80% VWRL (world stocks) and 20% AGBP (bonds in GBP) A few reasons: (1) it's simple, avoids tinkering risk, (2) as you add more bonds over time, currency risk will decrease. What you should definitely avoid (I...
by Noobvestor
Thu May 28, 2020 7:18 am
Forum: Non-US Investing
Topic: 20-year-old, Investment advice [UK]
Replies: 36
Views: 1415

Re: 20-year-old, Investment advice [UK]

I'd like to walk back my advice a bit (to add UK stocks) and just say I agree with glorat: 80% VWRL (world stocks) and 20% AGBP (bonds in GBP) A few reasons: (1) it's simple, avoids tinkering risk, (2) as you add more bonds over time, currency risk will decrease. What you should definitely avoid (I...
by Noobvestor
Thu May 28, 2020 7:13 am
Forum: Personal Investments
Topic: Betterment liquidated my investments without my authorization
Replies: 75
Views: 5360

Re: Betterment liquidated my investments without my authorization

Great suggestions in the mix. I will add two more (didn't see them, but did do some skimming so may have missed): 1) File a BBB complaint. Yes, they are an archaic and strange institution, but by filing complaints with fitting and explained modes of compensation (e.g. company should reimburse me for...
by Noobvestor
Wed May 27, 2020 7:05 pm
Forum: Non-US Investing
Topic: 20-year-old, Investment advice [UK]
Replies: 36
Views: 1415

Re: 20-year-old, Investment advice [UK]

I'd like to walk back my advice a bit (to add UK stocks) and just say I agree with glorat: 80% VWRL (world stocks) and 20% AGBP (bonds in GBP) A few reasons: (1) it's simple, avoids tinkering risk, (2) as you add more bonds over time, currency risk will decrease. What you should definitely avoid (IM...
by Noobvestor
Tue May 26, 2020 5:33 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

vineviz wrote:
Tue May 26, 2020 5:20 pm
So far I’m still wondering whether you think A or B is the better choice for the investor in my example?
It's a false binary choice for people who take a total-portfolio approach rather than viewing assets only in isolation.
by Noobvestor
Tue May 26, 2020 5:30 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

Long-term bond and short-term bonds can have different effects on the entire portfolio since they have different exposure to inflation and different volatility. These “different exposures” are what my example was a illustrating. I'm genuinely confused. Petulant is talking about bonds as part of a p...
by Noobvestor
Tue May 26, 2020 5:24 pm
Forum: Non-US Investing
Topic: 20-year-old, Investment advice [UK]
Replies: 36
Views: 1415

Re: 20-year-old, Investment advice [UK]

So, do you think currency risk is a big thing then? So, you're saying that even if the S&P 500 grew at a greater return than the FTSE 100, it would be worthwhile to have an ETF in the FTSE 100 because of the currency risk? Surely over time currency risk becomes obsolete? Currencies aren't the real ...
by Noobvestor
Tue May 26, 2020 5:17 pm
Forum: Non-US Investing
Topic: 20-year-old, Investment advice [UK]
Replies: 36
Views: 1415

Re: 20-year-old, Investment advice [UK]

Hedging is usually done with Bonds-they are the portfolio,s anchor to windward-ie your safe money-portfolio,s ballast. You don’t want currency fluctuations problems here-safety paramount. Equities are not usually hedged as in this part of your portfolio you are going all out for growth and this the...
by Noobvestor
Tue May 26, 2020 5:08 pm
Forum: Non-US Investing
Topic: 20-year-old, Investment advice [UK]
Replies: 36
Views: 1415

Re: 20-year-old, Investment advice [UK]

So, do you think currency risk is a big thing then? So, you're saying that even if the S&P 500 grew at a greater return than the FTSE 100, it would be worthwhile to have an ETF in the FTSE 100 because of the currency risk? Surely over time currency risk becomes obsolete? Currencies aren't the real ...
by Noobvestor
Tue May 26, 2020 7:23 am
Forum: Non-US Investing
Topic: 20-year-old, Investment advice [UK]
Replies: 36
Views: 1415

Re: 20-year-old, Investment advice [UK]

Thank you so much for your reply! Sure, happy to help if I can! Yeah, I want to hold some emerging market, just to diversify! Have you invested in specific ETFs? Or have you replicated an index yourself? I'm a US investor, so less familiar with UK options. It looks pretty feasible, though, to repli...
by Noobvestor
Tue May 26, 2020 6:32 am
Forum: Non-US Investing
Topic: 20-year-old, Investment advice [UK]
Replies: 36
Views: 1415

Re: 20-year-old, Investment advice [UK]

1. Is there any point of investing in an emerging markets bond ETF/fund, as emerging economies yields/risk premium seem to be increasing because of the government expenditure increasing (COVID-19 stimulus package) No one knows. Global diversification (e.g. a total-world fund) is a good starting poi...
by Noobvestor
Tue May 26, 2020 6:26 am
Forum: Non-US Investing
Topic: 20-year-old, Investment advice [UK]
Replies: 36
Views: 1415

Re: 20-year-old, Investment advice [UK]

Hi, I'm an economics undergraduate at the University of Bristol, and I have taken a significant interest in the stock market and began to learn how to carry out fundamental and technical analysis. I'm thinking of investing in 80% ETF's and 20% bonds may be a good start. I have £5000 to invest; howe...
by Noobvestor
Tue May 26, 2020 6:22 am
Forum: Investing - Theory, News & General
Topic: Peer to peer lending in this day and age
Replies: 46
Views: 2760

Re: Peer to peer lending in this day and age

If the P2P system you're using has an option to sell on a secondary market, I would sell. If it doesn't, ride it out. 2008/09 were one thing, but this ... well, unemployment and other metrics are quite different and a lot more scary, at least to me. Get out of it when/if you can. /2 cents
by Noobvestor
Tue May 26, 2020 6:19 am
Forum: Personal Investments
Topic: Capital gain conundrum
Replies: 10
Views: 1091

Re: Capital gain conundrum

Depends on the gains, tax bracket, too many variables, but in general I agree with the first response: pull off the band-aid and reallocate.
by Noobvestor
Tue May 26, 2020 6:17 am
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

On some risk metrics, shorter bonds are indeed safer. There's only one risk metric that matters to long-term investors, and short-term bonds aren't "safer" by that metric. Strange. I'm a long-term investor and concerned with a variety of risks. Also fairly sure I'm not the only one ... :confused Fi...
by Noobvestor
Tue May 26, 2020 6:16 am
Forum: Personal Investments
Topic: Taxable account has higher returns?
Replies: 18
Views: 1525

Re: Taxable account has higher returns?

For the remainder in taxable (per previous comment) I would suggest looking into Series I and EE bonds. One tracks inflation and the other doubles in 20 years. Both have some optionality with regards to cashing out, and the yields are attractive relative to other safe bond options. https://www.bogle...
by Noobvestor
Tue May 26, 2020 6:11 am
Forum: Personal Investments
Topic: I have no risk tolerance: where am I supposed to keep my money?
Replies: 73
Views: 6357

Re: I have no risk tolerance: where am I supposed to keep my money?

I like Benjamin Graham's rule of thumb, which is to never be outside the bounds of 75/25 to 25/75 stocks/bonds. At either extreme (100% stocks or bonds) you actually arguably have more risk (yes, even on the bond side). So I would start with a lower bound of 25% stocks. That said, I agree with other...
by Noobvestor
Tue May 26, 2020 5:53 am
Forum: Investing - Theory, News & General
Topic: Anybody do any GOOD timing the market?
Replies: 106
Views: 5819

Re: Anybody do any GOOD timing the market?

I wonder where all of the 'got out and am DCAing back in' folks went. Or those who were (are?) waiting for things to 'go lower' ... :shock: They’re still around. They won’t be back if we continue up, but if we get another dip they’ll be back in full force. You never hear from them before they make ...
by Noobvestor
Mon May 25, 2020 1:43 pm
Forum: Investing - Theory, News & General
Topic: Anybody do any GOOD timing the market?
Replies: 106
Views: 5819

Re: Anybody do any GOOD timing the market?

I wonder where all of the 'got out and am DCAing back in' folks went. Or those who were (are?) waiting for things to 'go lower' ... :shock:
by Noobvestor
Mon May 25, 2020 4:05 am
Forum: Investing - Theory, News & General
Topic: Thoughts & Questions on the Vanguard Extended Duration Treasury ETF
Replies: 16
Views: 971

Re: Thoughts & Questions on the Vanguard Extended Duration Treasury ETF

Basically, when bond rates go down, the value of existing bonds go up, which provides a tailwind for existing bond holders. EDV's recent gains are mostly due to decreasing bond rates over recent years. Now rates are at record lows. Assuming rates stay low, you can expect something like a 1.2% annual...
by Noobvestor
Mon May 25, 2020 2:59 am
Forum: Investing - Theory, News & General
Topic: El-Erian comments on the crisis
Replies: 63
Views: 6674

Re: El-Erian comments on the crisis

Boat SALES were up like 50% from last year. That's the stat that amazed me. Maybe people figure, why save for the future, if you're just going to die from a virus at 70 anyway? I've been thinking about buying a boat for the first time in my life (have boated, just never owned one). Why? Not a YOLO ...
by Noobvestor
Mon May 25, 2020 12:52 am
Forum: Investing - Theory, News & General
Topic: Tracking World Index w/ Separate US and International Funds Not Ideal?
Replies: 6
Views: 401

Re: Tracking World Index w/ Separate US and International Funds Not Ideal?

Too complicated for me. I prefer 50/50 for simplicity (plus I'm sort of locked in now due to taxable gains, so VTWAX isn't an option). Rebalancing is in part buying what's down and selling what's up, but the main thing is risk control, which is mostly a function of stock/bond ratio. If you wanted to...
by Noobvestor
Sun May 24, 2020 10:11 pm
Forum: Personal Investments
Topic: Time until money doubles
Replies: 26
Views: 2608

Re: Time until money doubles

Also + maybe market timing - and moving to spy from vti is prudent? You might want to check out this Vanguard whitepaper. Figure II-8 predicts lower returns across the board, but 'less low' for those who are well-diversified specifically: those who include international stocks. I don't know the fut...
by Noobvestor
Sun May 24, 2020 9:59 pm
Forum: Personal Investments
Topic: Dollar Cost Averaging - How long?
Replies: 14
Views: 1252

Re: Dollar Cost Averaging - How long?

Just go all in now. If that sounds scary, pick an asset allocation that doesn't sound scary. Done. No market timing necessary. +1 The problem with DCA is that it just forces you to make market-timing decisions on top of allocation decisions, as you're now discovering. The answer to the question is ...
by Noobvestor
Sun May 24, 2020 9:56 pm
Forum: Investing - Theory, News & General
Topic: Will the US become like Japan?
Replies: 68
Views: 5122

Re: Will the US become like Japan?

No one knows. Demographics look better for the US, but wouldn't count on those alone. International diversification is always a good idea IMHO.
by Noobvestor
Sun May 24, 2020 9:48 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

On some risk metrics, shorter bonds are indeed safer. There's only one risk metric that matters to long-term investors, and short-term bonds aren't "safer" by that metric. Strange. I'm a long-term investor and concerned with a variety of risks. Also fairly sure I'm not the only one ... :confused
by Noobvestor
Sun May 24, 2020 9:44 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

It is NOT predicting the future to say the "correlation of nominal Treasury bonds with stocks is reliably negative". Rather, this is merely a statement that the relationship is consistent: it's been dependably negative in the recent past and can be expected to be dependably negative in the future. ...
by Noobvestor
Sun May 24, 2020 9:31 pm
Forum: Personal Finance (Not Investing)
Topic: Would you pull a trigger on a home purchase or continue renting?
Replies: 45
Views: 3026

Re: Would you pull a trigger on a home purchase or continue renting?

I'm sure homes are not "700-800k" in your area. Real estate is way overpriced if that is truly the case. Consider moving to a lower COL area. This isn't an option. I like where I live, and I wouldn't change my career just to live somewhere cheaper. Liking where you are favors ownership generally. A...
by Noobvestor
Sun May 24, 2020 9:00 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

It seems that Bogleheads largely believe that risk-averse long-term investors would prefer short-term bonds to long-term bonds, and it seems that Rekenthaler thinks so to. This creates a perverse tendency to take on MORE risk when they think they are taking on LESS risk. It's these kinds of sweepin...
by Noobvestor
Sun May 24, 2020 8:47 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

Third, there are "well-documented" reasons why U.S. long-term bonds may not be the safe haven in the future, including pressure from other countries to shift demand to different reserve currencies, an eventual shift in U.S. demographics to be less age-heavy that will not be replicated in other coun...
by Noobvestor
Sun May 24, 2020 8:26 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

Here it is so other people can decide - do the past 20 years give us a better picture of the range of future possibilities ... or the past 90? I won’t bore you with details (lest I be accused again of relying on my professional training and education instead using “plain folks talk”), but due to a ...
by Noobvestor
Sun May 24, 2020 6:21 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

I’ll just quote Robert Merton from his famous Harvard Business Review article. The main thrust of the article is on retirement income, but this snippet is relative to here: "consider a person who plans to live off the income from $1 million invested in T-bills. Suppose he retires in a given year an...
by Noobvestor
Sun May 24, 2020 5:28 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

The correlation of nominal Treasury bonds with stocks is reliably negative This is demonstrably false. LTTs have had a low not 'reliably negative' correlation to stocks. This is a common misunderstanding, but you're pretty well-educated about these things (I mean that genuinely!), so I'm surprised ...
by Noobvestor
Sun May 24, 2020 9:33 am
Forum: Personal Finance (Not Investing)
Topic: Why are you NOT buying rental properties?
Replies: 1048
Views: 107862

Re: Why are you NOT buying rental properties?

A single property can fail more more easily than the entire real estate sector. Does it though? Really? Ignoring tenant risk, which is where I think most of the risk occurs. Of course just stripping out that risk is unfair, but I'm curious what folks think of real estate values. Other than the rece...
by Noobvestor
Sun May 24, 2020 9:05 am
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

The correlation of nominal Treasury bonds with stocks is reliably negative This is demonstrably false. LTTs have had a low not 'reliably negative' correlation to stocks. This is a common misunderstanding, but you're pretty well-educated about these things (I mean that genuinely!), so I'm surprised ...
by Noobvestor
Sun May 24, 2020 8:38 am
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

Furthermore, the qualifier (" At current rates ") introduces its own issue. Namely, the idea portfolio allocation should depens on current rates relies upon a premise that speculating/market timing can be successful and/or prudent to attempt in bond markets. I don't grant that premise. There's noth...
by Noobvestor
Sun May 24, 2020 8:11 am
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

I think you know my personal answer to this, which is: a combination of nominal and real-return safe bonds of an intermediate target duration (e.g. intermediate TIPS and Treasuries or barbells that achieve those average durations, which might even include long bonds!). As I see it, those provide a ...
by Noobvestor
Sat May 23, 2020 8:27 pm
Forum: Personal Finance (Not Investing)
Topic: Why are you NOT buying rental properties?
Replies: 1048
Views: 107862

Re: Why are you NOT buying rental properties?

Some of us real estate investors also have an investment portfolio that includes cash, stocks and bonds. The real estate is just another diversifier that could potentially decrease our risk as well as increase our returns or not... It might well, but it's still a concentrated risk, making it very d...
by Noobvestor
Sat May 23, 2020 8:12 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

I and EE Bonds unfortunately have annual purchase caps. If more fixed income is needed to reach desired AA, for an investor with a long investment time horizon, what is better than LTT? One could just buy more equities, but what other fixed income option offers better long term potential? It seems ...
by Noobvestor
Sat May 23, 2020 7:30 pm
Forum: Personal Finance (Not Investing)
Topic: Why are you NOT buying rental properties?
Replies: 1048
Views: 107862

Re: Why are you NOT buying rental properties?

Some of us real estate investors also have an investment portfolio that includes cash, stocks and bonds. The real estate is just another diversifier that could potentially decrease our risk as well as increase our returns or not... It might well, but it's still a concentrated risk, making it very d...
by Noobvestor
Sat May 23, 2020 7:01 pm
Forum: Investing - Theory, News & General
Topic: Rekenthaler: Long Bonds Are for Fools
Replies: 346
Views: 17984

Re: Rekenthaler: Long Bonds Are for Fools

I am not sure why people fear long bonds, especially if your investment time horizon is 20+ years. Aside from I Bonds and EE Bonds, not sure what else is as risk free as long term treasuries for the long term investor. I plan to mix those 3 with low cost diversified broad market equity index funds ...