Search found 1475 matches

by Dan Kohn
Sat Aug 18, 2012 3:55 pm
Forum: Investing - Theory, News & General
Topic: A Review of Employee Fiduciary's 401(k)
Replies: 57
Views: 37323

Re: A Review of Employee Fiduciary's 401(k)

This 4 year old post still generates a bunch of private messages, and I'm not active on the board anymore, so I wanted to give a quick update. I'm not at the Linux Foundation any more (though I consult with them), but they're still using Employee Fiduciary and are still happy with the services provi...
by Dan Kohn
Thu Dec 17, 2009 10:01 am
Forum: Forum Issues and Administration
Topic: Daily Hits to This Site
Replies: 66
Views: 12350

Re: Daily Hits to This Site

Wow, I'd conservatively estimate the value of that traffic at between $30,000-40,000 per month but conceivably as high as $100,000. Kudos for resisting the urge to monetize it. Alex and Larry are incredibly generous in their donations of time and money. That said, 36,000 pageviews a day or 1 millio...
by Dan Kohn
Sat Oct 03, 2009 10:00 pm
Forum: Investing - Theory, News & General
Topic: The Bogleheads' Guide to Retirement Planning IS HERE!
Replies: 94
Views: 19110

Re: Corrections to The Bogleheads' Guide to Retirement Plann

If anyone is interested in corrections; Chapter 3 refers to personal exemptions for yourself, your spouse, and your children. A personal exemption is only for yourself and your spouse. A dependent exemption is for your other qualified dependents such as your child. State sales taxes do exceed 6.25 ...
by Dan Kohn
Fri Oct 02, 2009 8:44 pm
Forum: Investing - Theory, News & General
Topic: TSP S and I Funds Tracking Error
Replies: 9
Views: 2360

Wow

Those are shockingly bad numbers.

However, Vanguard's institutional EAFE fund is showing a tracking error of 1.85% due to "fair value pricing", so there's more to this story.
by Dan Kohn
Sun Aug 30, 2009 3:08 pm
Forum: Personal Consumer Issues
Topic: 5 Years in Seattle: Rent or buy home?
Replies: 61
Views: 7351

Summary

Please see Owning vs Renting on the Bogleheads Wiki. I discuss many of these issues. In general, I think 10 years tends to be the break-even point, but a young professional shouldn't discount the added flexibility of renting.
by Dan Kohn
Tue Aug 18, 2009 8:22 pm
Forum: Investing - Theory, News & General
Topic: TIPS laddered and annuities
Replies: 22
Views: 3175

Agreed, not ideal. Better would be a non-rolling TIPS ladder that matured in, say, 3 chunks, at retirement, and 5 and 10 years later. Buy a separate SPIA at each maturity. You need 3 anyway to get the maximum state guaranty.
by Dan Kohn
Tue Aug 18, 2009 5:14 pm
Forum: Personal Consumer Issues
Topic: South Africa Recommendations
Replies: 12
Views: 2431

District 9

zhiwiller wrote:Stay away from District 9.
Image
by Dan Kohn
Tue Aug 18, 2009 5:08 pm
Forum: Investing - Theory, News & General
Topic: TIPS laddered and annuities
Replies: 22
Views: 3175

Ladders

When you hold individual TIPS to maturity, you can reasonably expect to have your principal returned to you. A TIPS fund (or any fund) cannot maket that same assurance. Bob, what you wrote here is correct in context, but the statement is often misapplied to bond ladders. If you are saving up for a ...
by Dan Kohn
Mon Aug 10, 2009 4:48 pm
Forum: Investing - Theory, News & General
Topic: Was someone making money in 2008?
Replies: 11
Views: 1916

Zero sum

For the stock market to be zero sum, every company would have to have 100% of its shares sold short. I believe across the whole market, the number is only in the single digit percent. By contrast, the currency market is zero sum. You can't make money without someone else losing the same amount, and ...
by Dan Kohn
Mon Aug 10, 2009 10:58 am
Forum: Investing - Theory, News & General
Topic: 30 Year TIPS May Return
Replies: 0
Views: 652

30 Year TIPS May Return

The Treasury announced : Additionally, to potentially improve liquidity in the TIPS program and better capture the premium associated with inflation protection, Treasury will consider replacing 20-year TIPS with 30-year TIPS. Any potential changes to the TIPS program will be announced at the Novembe...
by Dan Kohn
Thu Aug 06, 2009 2:33 pm
Forum: Investing - Theory, News & General
Topic: S&P 500 Earnings Recovery Astonishing!
Replies: 21
Views: 3903

Inventory

If you're interested in analysis of inventory and earnings, I highly recommend this blog post today by Bronte Capital, an Australian hedge fund that closely follows US news. Pick a highly discretionary purchase: speed boats. In their example, consumer sales are down 30%. But dealers, desperate to re...
by Dan Kohn
Tue Aug 04, 2009 4:44 pm
Forum: Personal Finance (Not Investing)
Topic: Tax Rules on Capital Gain
Replies: 21
Views: 2951

Wiki

by Dan Kohn
Fri Jul 31, 2009 8:35 pm
Forum: Personal Investments
Topic: Here we go again...
Replies: 39
Views: 11586

What to do

Go to the closest branch of a big national bank. Open a savings account or no-interest checking account with $10. Ask for the VP to do the medallion signature guarantee. Close the savings account, or leave it open in case you need to repeat. It would take less than an hour, which is far less than yo...
by Dan Kohn
Thu Jul 23, 2009 11:21 pm
Forum: Investing - Theory, News & General
Topic: CDs versus Bond Funds
Replies: 14
Views: 2862

Re: CDs vs Bonds

But isn't it true that in a CD ladder in a rising interest rate environment, I can choose to invest the funds of a maturing CD in a money market fund or in some other category, while the bond fund would not offer that choice because its NAV has fallen with the rise in rates, and I'm stuck between s...
by Dan Kohn
Thu Jul 23, 2009 10:47 pm
Forum: Investing - Theory, News & General
Topic: CDs versus Bond Funds
Replies: 14
Views: 2862

CDs vs Bonds

But if interest rates rise, wont the bond fund guarantee a loss? When the losing bonds reach a certain date they must be sold and have the loss locked in. No, a ladder of CDs responds identically to interest rate changes as a ladder of individual bonds with the same duration. A bond fund with the s...
by Dan Kohn
Thu Jul 16, 2009 3:55 pm
Forum: Investing - Theory, News & General
Topic: Terms That Baffle Me
Replies: 22
Views: 3587

More buyers than sellers

rb313 wrote:I like it when they say the market had more buyers than sellers. How they do that?
I got that answered a few months ago:
http://www.bogleheads.org/forum/viewtopic.php?t=34866
by Dan Kohn
Thu Jul 16, 2009 3:48 pm
Forum: Investing - Theory, News & General
Topic: Known VBS TIPS Interest Problem
Replies: 67
Views: 9407

smileys

Sorry, a former professor of mine, who is British, convinced me that smileys ruin the sardonic humor. Needless to say, most class action attorneys I've met want to find plaintiffs with damages bigger than the cost of a postal stamp.
by Dan Kohn
Thu Jul 16, 2009 2:42 pm
Forum: Investing - Theory, News & General
Topic: Known VBS TIPS Interest Problem
Replies: 67
Views: 9407

The cost

If you have $1 M in TIPS with a 3% (nominal) coupon (paid twice a year) where the coupon failed to earn interest from Prime Money Market for 2 days, you are out: $1 M x 3% x 1/2 x 0.24% x 2/252 = $0.29. http://www.google.com/search?hl=en&q=1000000+x+3%25+x+1%2F2+x+0.24%25+x+2%2F252 Class action suit...
by Dan Kohn
Wed Jul 15, 2009 10:49 am
Forum: Personal Investments
Topic: VIPSX or etf TIP
Replies: 10
Views: 3976

VIPSX

Please see Individual Bonds vs a Bond Fund on the Bogleheads Wiki . I would recommend something like 75% VIPSX and 25% Short Term Treasuries. The Treasuries will be less volatile in case you do need the money in the very short term. There is not a lot of difference between VIPSX and TIP; ether is fi...
by Dan Kohn
Mon Jul 13, 2009 2:38 pm
Forum: Investing - Theory, News & General
Topic: Financial math question: IRR
Replies: 8
Views: 1966

Sure

An economically rational actor will make all investments where the IRR is higher than their cost of capital (which is their opportunity cost). Of course, once you start factoring in the risk associated with future payments (and possible cross-correlations between risks of different investments), thi...
by Dan Kohn
Mon Jul 13, 2009 2:35 pm
Forum: Personal Finance (Not Investing)
Topic: Huh! When is FDIC Insurance not enough?
Replies: 28
Views: 3692

Appalling

I'm surprised the plantiffs have not filed with the bank's regulator to have its license revoked. Having an employee accept a deposit (at the branch or via wire) and then claiming you're not responsible seems to open the bank to civil (or criminal?) charges of fraud. If the bank thinks the choice is...
by Dan Kohn
Mon Jul 13, 2009 1:21 pm
Forum: Investing - Theory, News & General
Topic: Financial math question: IRR
Replies: 8
Views: 1966

No

IRR doesn't include opportunity cost. IRR needs to be higher than your cost of capital to justify an investment. If you want to include your opportunity cost as an input, use net present value (NPV). IRR is the cost of capital at which NPV is zero.
by Dan Kohn
Mon Jul 13, 2009 12:18 pm
Forum: Investing - Theory, News & General
Topic: Ritholtz on Jeremy Siegel (Stocks for the Long Run)
Replies: 89
Views: 10405

Re: Do valuations matter?

Buying and holding the whole market with your age in bonds, while rarely the actual optimal strategy with hindsight (as compared to being able to correctly predict the highest returning asset class each year), is almost always the strategy of least regret. Wouldn't the regret minimizing strategy be...
by Dan Kohn
Mon Jul 13, 2009 10:53 am
Forum: Investing - Theory, News & General
Topic: Ritholtz on Jeremy Siegel (Stocks for the Long Run)
Replies: 89
Views: 10405

worst possible

This graph attempts to put Shiller's PE10 in context as a distribution: http://www.early-retirement-planning-insights.com/stock-return-predictor.html Nice presentation, but please change the text from "worst possible". If you want to know the worst possible stock market return, look at Poland in 19...
by Dan Kohn
Mon Jul 13, 2009 10:48 am
Forum: Investing - Theory, News & General
Topic: Ritholtz on Jeremy Siegel (Stocks for the Long Run)
Replies: 89
Views: 10405

Do valuations matter?

We all know that valuation matter. Just about everyone also knew by 2000 that markets were then overvalued by historical standards. Shiller dosen't deserve credit for making that call 4 or 5 years too early. The problem is that markets can remain overvalued for decades, and trying to act on that in...
by Dan Kohn
Wed Jun 24, 2009 11:49 am
Forum: Investing - Theory, News & General
Topic: Confused by interest rate% and yield % relationship - TIPS
Replies: 12
Views: 1976

Re: VIPSX

Why not buy Vanguard's TIPS fund (VIPSX) and let the manager with his expertise worry about it? Not to say that Vanguard's TIPS fund isn't a good fund, but isn't it a core Boglehead belief to be wary of purported "manager expertise"? :wink: The reason to use a bond fund is not because of the "alpha...
by Dan Kohn
Wed Jun 24, 2009 10:22 am
Forum: Investing - Theory, News & General
Topic: This bear market vs 3 others
Replies: 1
Views: 843

This bear market vs 3 others

This is updated weekly from dshort.com:

Image
by Dan Kohn
Mon Jun 22, 2009 9:48 pm
Forum: Personal Consumer Issues
Topic: Latin scholars - plural of prospectus
Replies: 63
Views: 12561

Re: Latin scholars - plural of prospectus

nisiprius wrote:Delta, gamma, theta, and vega? Vega?

That's no Greek letter... is it?
Vega, vomma, zomma.

Aeschylus was spouting this stuff all the time.
http://en.wikipedia.org/wiki/Greeks_%28finance%29
by Dan Kohn
Mon Jun 22, 2009 9:19 pm
Forum: Personal Consumer Issues
Topic: Latin scholars - plural of prospectus
Replies: 63
Views: 12561

Re: Latin scholars - plural of prospectus

nisiprius wrote:I've never seen a textbook of "Financial Greek and Latin"
All options traders know their greek(s).

http://www.theoptionsguide.com/the-greeks.aspx
by Dan Kohn
Mon Jun 22, 2009 9:09 pm
Forum: Investing - Theory, News & General
Topic: Covered option call
Replies: 22
Views: 3570

The same

Both are bullish bets. You can see from the payoff diagrams that they are equivalent:

http://www.theoptionsguide.com/uncovere ... iting.aspx
http://www.theoptionsguide.com/covered- ... iting.aspx

They're also not something I would ever recommend.
by Dan Kohn
Mon Jun 22, 2009 8:57 pm
Forum: Personal Finance (Not Investing)
Topic: Article about how $1,000,000 isn't enough...
Replies: 36
Views: 5788

Coke

If you're not an investment banker, and don't they live in Connnecticut anyway, or something similar, New York is so expensive you're pretty much forced to live frugallly. I can only imagine what a can of Coke is going for in Midtown these days. $1.25 . But that includes delivery to your apartment,...
by Dan Kohn
Mon Jun 22, 2009 5:22 am
Forum: Personal Consumer Issues
Topic: Why are appendectomies the emblem of surgery?
Replies: 49
Views: 7170

Doogie Howser, MD

Everything I know about surgery, I learned from Doogie Howser, MD . Here's the episode A Stitch Called Wanda , where "Out on a date with Doogie, Wanda suffers an appendicitis attack and is rushed to the hospital for emergency surgery." And, it's watchable for free on Hulu! Hopefully, EmergDoc has ot...
by Dan Kohn
Sun Jun 21, 2009 8:14 pm
Forum: Personal Consumer Issues
Topic: Why are appendectomies the emblem of surgery?
Replies: 49
Views: 7170

Surgery

As far why it came to symbolize surgery, I guess it is because it is an operation that can be done by most any trained surgeon fairly quickly, with usually a quick recovery and no residual disability, in what otherwise would be a fatal illness. Appendectomies are emblematic of why it is really nice...
by Dan Kohn
Sun Jun 21, 2009 8:39 am
Forum: Investing - Theory, News & General
Topic: Bogle: avoid stocks if you can't lose money
Replies: 29
Views: 4991

We'd love to have you (and anyone else interested) become a wiki editor and make all the changes you see fit.
by Dan Kohn
Sun Jun 21, 2009 7:15 am
Forum: Personal Investments
Topic: Newbie - needs advice on portfolio
Replies: 13
Views: 2309

Re: TSM

YDNAL wrote:I already provided a link!
I went through a lot of trouble getting that citation text to appear automatically at the bottom of wiki entries. When people change the link text, I am easily confused.
by Dan Kohn
Sun Jun 21, 2009 7:13 am
Forum: Investing - Theory, News & General
Topic: Matrix Redux: The Larry-Browne Permanent Portfolio
Replies: 66
Views: 108755

Taylor

I know that your intentions are to be helpful here... If you do ever post that again, without the counterbalance, I will begin to question that. Is that supposed to be a threat? Trev H, you've been a valuable contributor here for a while, so I'm concerned to see you take such an inflammatory tone. ...
by Dan Kohn
Sun Jun 21, 2009 6:41 am
Forum: Investing - Theory, News & General
Topic: Indexing vs. Active. What local paper said today.
Replies: 27
Views: 5358

Active funds can outperform the index IF the manager is able to affect real world outcomes and decisions. You might want to reread the paper. Not only can active funds outperform the index, but before fees, half of all active funds do in fact outperform the index every single year. But the discussi...
by Dan Kohn
Sun Jun 21, 2009 6:34 am
Forum: Personal Investments
Topic: Newbie - needs advice on portfolio
Replies: 13
Views: 2309

TSM

SSS wrote:Thank you all for your contribution. I really appreciate it. Question. Is it fair to say that Total Stock fund = 500 Index + Extended market?
Please see Approximating Total Stock Market on the Bogleheads Wiki.
by Dan Kohn
Sun Jun 21, 2009 6:28 am
Forum: Personal Investments
Topic: A good time to buy Fannie Mae Bonds?
Replies: 1
Views: 1025

Bad idea

Investing in any individual corporate or muni bond is a bad idea, IMHO. Yes, Fannie Mae is really close to government-backed. But the government has not been willing to explicitly back the debt, because they don't want to double the size of the public debt. It's quite unlikely, but at least possible...
by Dan Kohn
Sat Jun 20, 2009 11:40 pm
Forum: Personal Finance (Not Investing)
Topic: Naive questions about bond funds
Replies: 5
Views: 2073

Wiki

On the Bogleheads Wiki, please see Bond Basics and Individual Bonds vs a Bond Fund.

But please ask again if anything remains unclear.
by Dan Kohn
Sat Jun 20, 2009 9:20 pm
Forum: Investing - Theory, News & General
Topic: Bogle: avoid stocks if you can't lose money
Replies: 29
Views: 4991

Re: DCA

I'd actually take issue with this. If your goal is minimizing regret how do you know that if you start DCA and the market has big uptick you won't suffer greater regret than an equal drop would have caused? I don't think it is obviously true that DCA minimizes regret whereas it is obviously true th...
by Dan Kohn
Sat Jun 20, 2009 8:59 pm
Forum: Personal Investments
Topic: MassMutual Whole Life Policy
Replies: 16
Views: 6115

Opportunity cost

I agree with the above in that it is best to buy term and invest the difference. What happens if you are already in a Whole Life policy? Should you cash out, buy term and invest the difference? After 8 years into a Whole Life policy, the amount of my premiums are going straight to Cash Value. It's ...
by Dan Kohn
Sat Jun 20, 2009 8:52 pm
Forum: Personal Investments
Topic: Vanguard short term bond fund vs Thrift savings G fund?
Replies: 12
Views: 4081

Re: G fund

Munir wrote:I had never heard of the G fund either. Thank you for educating us about it. Makes me envious of federal employees.
Please see G Fund in Thrift Savings Plan on the Bogleheads Wiki. And remember that the TSP is available to both current and many former employees of the federal government.
by Dan Kohn
Sat Jun 20, 2009 8:46 pm
Forum: Investing - Theory, News & General
Topic: Bogle: avoid stocks if you can't lose money
Replies: 29
Views: 4991

DCA

Kenster1 wrote:So what happened to the debates the Bogleheads were having about DCA versus Lump Sum?
I wrote this wiki article trying to summarize the conversation. My hope is that wiki entries like this reduce the low-signal repeat conversations.

Please see Lump sum vs DCA on the Bogleheads Wiki.
by Dan Kohn
Sat Jun 20, 2009 2:40 pm
Forum: Investing - Theory, News & General
Topic: Nominal Bonds vs Inflation
Replies: 53
Views: 7701

Klotz

Here's some interesting discussions on laddering http://www.fmsbonds.com/News/bond_article.asp?id=150 http://www.fmsbonds.com/News/bond_article.asp?id=167 Duhmel1, I read your bond guru (James Klotz), and I find him nonsensical. In fact, I think the advice they're offering is so bad as to approach ...
by Dan Kohn
Sat Jun 20, 2009 1:54 pm
Forum: Personal Investments
Topic: Bond Allocations
Replies: 18
Views: 4475

Suggestions

No-Debt Indexer, I understand that you're planning to spend most of the dividends you receive from your bond fund, so tax-efficient location (putting tax-inefficient funds in tax-deferred accounts) becomes less important. My preferred conservative portfolio is similar to Target Retirement Income: 70...
by Dan Kohn
Fri Jun 19, 2009 4:29 pm
Forum: Investing - Theory, News & General
Topic: Do TIPS have credit risk? Are investors compensated?
Replies: 10
Views: 2007

Default

Siegel's argument is dumb on many levels. Among others, is his claim that the US wouldn't default on its dollar-denominated debt. Just 14 years ago, the Speaker of the House threatened to do just that (see this NYT article or a research paper ). There's even a history of other countries actually fai...
by Dan Kohn
Fri Jun 19, 2009 11:57 am
Forum: Investing - Theory, News & General
Topic: Nominal Bonds vs Inflation
Replies: 53
Views: 7701

Inflation

Buddtholomew wrote:does higher inflation correlate with higher interest rates?
Higher inflation means higher nominal interest rates. Real interest rates remain unchanged. The nominal rate = the real rate + the rate of inflation.
by Dan Kohn
Fri Jun 19, 2009 5:43 am
Forum: Investing - Theory, News & General
Topic: Nominal Bonds vs Inflation
Replies: 53
Views: 7701

Re: Response

It sounds like I should open a Roth IRA and go 100% TIPs (VIPSX) there. That's better than plowing all my spare change into my beloved muni fund (VWIUX) in my taxable account right? :) I still harbor the outdated notion that taxable accounts are more accessible in case of need than IRAs, despite be...
by Dan Kohn
Thu Jun 18, 2009 8:19 pm
Forum: Investing - Theory, News & General
Topic: Nominal Bonds vs Inflation
Replies: 53
Views: 7701

Response

In light of this tricky situation, what kind of bond funds would you invest in if you planned to reinvest interest and DCA continuously for the next 15+ years after which you would (potentially) begin living off of the income stream? Currently I have Vanguard Intermediate Muni fund in taxable and T...