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2wolves

Be careful as usual AT&T isn't doing this out of the kindness of their heart. It will save money for some and not so much for others. #1 you can only have 4 line on Next at a time. Lines 5+ either have to be owned or pay $40/m and get the normal subsidized price with 2yr contract I am on the or...

2wolves

Thanks, those give me a good starting point.

2wolves

I am having similar issues. I'm trying to get my company to offer low cost index funds. The referred me to a white paper written for JP Morgan that references a Petajisto study. The study says that more active managers perform significantly better than passive investors (from 1990 to 2009). This see...

2wolves

I'm like you - don't borrow, but I also now have a paid off house. Don't know what my score is and frankly don't give a hoot, as short of a catastrophe I will never borrow money again in my lifetime, a good feeling to have in my 40s. Credit score can also affect your insurance rates in many states....

2wolves

I refinanced many times, and sometimes the highest rating was 800+. But I agree that above 740 will put in in a high enough group for just about everything else.

2wolves

How much in assets does a company need before Vanguard will administer directly?

2wolves

If you read the notes below the expense ratio information on Morningstar you see that it is artificually being held to 0.04% until at least 11/01/2013: "Expense Waivers The Fund’s adviser, administrator and distributor (the Service Providers) have contractually agreed to waive fees and/or reim...

2wolves

Why not use the gross number? I'm not going to claim to know what all the components of the fees refer to, but I do feel safe in saying that the real fee for the funds and account are likely higher than the highest number you've seen so far. Basically, the same answer as above. I'd call or write th...

2wolves

I'm trying to figure out how the fee reporting works. I ran into a couple cases that have me scratching my head. The first is the case of JPMorgan Equity Index Select (HLEIX). Morning star has their actual expense ratio as 0.2% and management as 0.25%. I had thought that management and administrativ...

2wolves

Plans have discretion to decide what services they will provide to plan participants and the only legal requirement is that the cost of the services be reasonable, not the cheapest. An employee can opt not to participate in the plan. I think we can all agree that this is the point where you complet...

2wolves

ScarletIris wrote:I can tell you what I did in the same situation: I went to grad school early. I've never regretted it. Saved a year's tuition and a year of my life.

Was college that bad for you?

2wolves

And I used the extremes because I think everyone can relate to the feeling of extremes. Bold added. You are highlighting that this really is not about mitigating financial risk so much as mitigating psychological risk. As it should be. And as I implied earlier with my references to utility theory. ...

2wolves

The answer is no. Maintaining your AA by balancing does the compensating for you. Say you are 50/50 stocks / bonds. Stocks drop 50%, so now you are overall at 33/67. So, you rebalance by selling bonds to buy stocks so you are back to 50/50. You can argue that if stocks drop 50% the risk of stocks h...

2wolves

bertilak wrote: See my post about six above. That simply does not work to any meaningful degree. DCA does not mitigate so much as postpone. Changing your AA will mitigate.

What is your measure of effectiveness?

2wolves

I am curious how people might change their answer based on big market events. For example, if the market went parabolic, would that change your target AA? What if it fell by 50%? I think those would change my strategy because I would perceive different risk levels than before. But it sounds like ma...

2wolves

Rodc wrote:DCA is certainly not, even at its best, much of a risk mitigation strategy.

If the risk you are trying to avoid is getting into the market at the worst time, then it is an excellent risk mitigation strategy.

2wolves

I am curious how people might change their answer based on big market events. For example, if the market went parabolic, would that change your target AA? What if it fell by 50%? I think those would change my strategy because I would perceive different risk levels than before. But it sounds like man...

2wolves

Not sure if the "wrong measure" statement was referring to my 30 years reference. That was only pointing out how long ago the paper came out. The wrong measure is referring to to people's obsession here with the average end result. I mention utility as the better measure, but it is more a...

2wolves

It does not matter that DCA will guarantee an investor beats a hypothetical lump sum investor who invested on the highest price during a DCA period. This is not a logical reason to DCA. If you invest in an AA appropriate for your need, willingness, and ability to take risk, there is no reason not t...

2wolves

But my question was "Why does ot STOP being better?" Continuing that average AA would produce lower dispersion forever. Because whether using DCA or lump sum, AA varies over time. Differing levels of risk are acceptable depending on one's goals. In some cases, the lower volatility forever...

2wolves

Lump-sum wins 70% of the times! It means it loses 30% of the times. QED What should be the interesting part is the difference in magnitude of the losses in those 30% of cases vs. the difference in magnitude of the gains using the two systems. That will give you a cost vs. benefit. Cost/Benefit work...

2wolves

Rodc wrote:
I'm willing to take the odds of 70-30...

I bet there are also some scenarios where you wouldn't.

2wolves

Clearly_Irrational wrote: DCA should provide a lower dispersion of returns but the expected value will be lower.

There are obviously some assumptions that also go into this, but yes, that's the expectation.

2wolves

empb wrote: The arguments against DCA don't rely on which will provide the greatest returns.

That seems to be the measure that most people are putting up.

2wolves

I wonder if the people against DCA are also in favor of heavy leveraging. After all, that would lead to a much greater return on average. So wouldn't it make since to leverage as much as you can right now?

2wolves

DCA doesn't make sense to me. Okay, you're afraid of a 50% market crash the day after your lump sum investment -- that's fair. So you faithfully DCA over the course of 2 years, the market is essentially flat over that period... and then the day after your last DCA investment, there's a 50% market c...

2wolves

Now here we are in the mid-afternoon and the S&P has improved significantly from this morning. If I had done DCA back into the market I would missed the recovery that occurred later. And I had the opportunity to put a large sum of money into the market last month, but chose to DCA. If I hadn't ...

2wolves

Best solution is to move all your assets to Vanguard. I have found the staff on the Flagship / Voyager lines to be a cut above the general line. Just like the airlines and hotels give better service to their best customers. Voyager is not that good. I had to call in last week and got transferred th...

2wolves

Here's an example: my current allocation of $100,000 is 80% stocks, 20% bonds. I inherit $100,000 that I put into a money market account. If I want to keep an 80/20 allocation, I can lump sum $80,000 into stocks and $20,000 into bonds. Instead, I feel that I'm more comfortable if I DCA this money i...

2wolves

It still amazes me how many people think there is something to DCA-ing when there is nothing there. Investing is all about figuring out the appropriate portfolio allocation for yourself taking into consideration your need, ability, and willingness to assume risk and then maintaining that allocation...

2wolves

For a completely rational investor, lump sum investing will always produce a higher expected return, because it immediately moves your funds from asset classes with lower expected returns to ones with higher expected returns. Note that higher expected returns do not guarantee that your actual retur...

2wolves

On average, we find that an LSI [lump sum investing] approach has outperformed a DCA [dollar cost averaging] approach approximately two-thirds of the time, even when results are adjusted for the higher volatility of a stock/bond portfolio versus cash investments. This finding is consistent with the...

2wolves

I'd invest half now and the rest over the next 10 months. On a really bad day I would accelerate my purchases. I've been waiting for that bad day for the last 3 months. Hasn't come so far, and have give up about 10% growth. :oops: Holding off on purchase, since the day I buy is the day before we se...

2wolves

I'm going through the same decision, but with $200,000. I think I'm going to invest $50,000 right away. If the market drops considerably, then I'll put in another $50k-$75k. Otherwise I'll dollar cost average over the year and maybe pay off some of the mortgage.

2wolves

I've learned over the past few weeks that there are two investment topics that people become very passionate about - gold and houses. Rick Ferri I must admit that my first instinct was to find something to critique based on the title of the thread. But then I read the blog and it was mostly benign....

2wolves

Still, I would consider the backdoor Roth a no-brainer.

2wolves

Welcome to the forum. I would max out the roth. You should read up on using a roth as an emergency fund. In general, the contributions to a Roth can be removed tax/penalty free, but make sure you read up on the rules. Maxing out the roth would meet your savings needs and satisfy your wife's need to...

2wolves

There are many calculators that try to answer the question. Have you tried them? One's I would use are http://www.firecalc.com , Fidelity's Retirement Income Planner, and Otar's flexible retirement planner. Does firecalc still not account for taxes? It would be the best tool if it did, but without ...

2wolves

Greetings To All: The Munchkin Man spends approximately 25% of the Munchkin Man's monthly gross income on the Munchkin Man's monthly rent. The Munchkin Man lives in a studio apartment building on the 4th floor of an old high rise apartment building built back in the 1960s. The Munchkin Man's studio...

2wolves

ClosetIndexer wrote: Just saying that if the goal were to maximize expectation with no concern for risk (which would be an irrational goal), then maximum tilt and maximum leverage would be the way to go.

At that point, why not just use options? There are all sorts of ways to go for broke in the market.

2wolves

My phone bill, grandfathered in to AT&T 2 accounts for unlimited everything, is $234 a month. Something's gotta give. No one's tried Virgin Mobile for smart phones? The website shows a seal that says it has the J.D. Power highest customers satisfaction among non-contract phone carriers. I'm wil...

2wolves

This whole thread derail was someone just being a semi-smart-ass with the statement "Save the higher earning spouse's entire gross salary". They just pulled the example of $300k spouse and $50k spouse out of the air to prove their point. No one here thinks this hypothetical couple should ...

2wolves

This whole thread derail was someone just being a semi-smart-ass with the statement "Save the higher earning spouse's entire gross salary". They just pulled the example of $300k spouse and $50k spouse out of the air to prove their point. No one here thinks this hypothetical couple should ...

2wolves

Looking at the 5-year PenFed HEL and had two quick questions I'm hoping someone can answer: 1. Is the current 1.99% rate fixed for the 5-year term? 2. Does the loan straight line amortize or does it have a 30-year amortization schedule with a balloon? Thanks. It is 1.99% fixed with a 5 year amortiz...

2wolves

There is no need to any small caps, "tilts", etc. as this is the Total Market approach often noted as the efficient frontier. If you were really trying to get a portfolio that accurately represented the efficient frontier, you'd probably need even more investments. Add in lots of commodit...

2wolves

From the paper. This doesn't seem to imply what the article referencing it implies. "Out of the 28 areas considered, only Dallas has a required appreciation rate that is higher than the average return they experienced during the last 25 years. These results imply that if the average appreciatio...

2wolves

[Inappropriate remark removed by admin LadyGeek]

2wolves

I agree with the people that say to do it only if you get a discount and can sell it immediately. I've just started ESPP last year (just became available due to a buyout), but my philosophy is to buy (15% discount), but I thought I should hold it a year to pay long-term instead of short-term gains....

2wolves

It can also be a hassle at tax time. Most tax software finds ways to screw up the calculation.

I contribute the full amount towards my ESPP, but I have a 15% discount. I don't think I'd do it if it were only 5%.

2wolves

coinflip wrote:Can we fix it? Yes we can!

I just wanted to make sure that this obligatory response was included. I see coinflip has it covered.

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