Search found 3046 matches

by Random Walker
Mon Oct 15, 2018 12:36 pm
Forum: Investing - Theory, News & General
Topic: What Jack Bogle Expects From the Market
Replies: 11
Views: 1996

Re: What Jack Bogle Expects From the Market

With stocks 4-5% and treasuries 3%, seems like a whole lot of extra risk without much extra expected return for equity heavy portfolios.

Dave
by Random Walker
Mon Oct 15, 2018 10:58 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Prepare For The Bear
Replies: 15
Views: 2395

Re: Larry Swedroe: Prepare For The Bear

Hi Dave, Read the article. Larry does make some good points. However, his claims around QRPRX, QSPRX, LENDX, AVRPX and SRRIX are not really testable (by me) in terms of correlation. Best I could find from PV is this . Of course the problem as you see is that QRPRX is new (2017) so who knows what ha...
by Random Walker
Mon Oct 15, 2018 9:28 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: 2018 Good For Gurus
Replies: 7
Views: 1056

Re: Larry Swedroe: 2018 Good For Gurus

Certainly nobody knows, but a big bear will hit sometime in the future. We all need to incorporate that into our plans. Larry wrote a good article on that today which I posted separately.

Dave
by Random Walker
Mon Oct 15, 2018 9:25 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Prepare For The Bear
Replies: 15
Views: 2395

Larry Swedroe: Prepare For The Bear

https://www.etf.com/sections/index-investor-corner/swedroe-29?nopaging=1 Great article: references to Peter Lynch, Benoit Mandelbrot, Buffett, Napoleon Bonaparte,non-normal distribution of returns, recency bias. Evaluating where you currently are relative to your goals after this long bull market an...
by Random Walker
Fri Oct 12, 2018 12:49 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: How A Multi-factor Portfolio Is Constructed Matters
Replies: 5
Views: 420

Re: Larry Swedroe: How A Multi-factor Portfolio Is Constructed Matters

DFA, Bridgeway, AQR do. I don’t specifically know about the VG funds, but looking at its description of VFMFX, it looks like VG does the same sort of screening. Individual stocks are assigned separate scores for each of several factors, then stocks chosen for the fund that pass all the screens. I’ve...
by Random Walker
Fri Oct 12, 2018 12:04 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: How A Multi-factor Portfolio Is Constructed Matters
Replies: 5
Views: 420

Larry Swedroe: How A Multi-factor Portfolio Is Constructed Matters

https://alphaarchitect.com/2018/10/11/how-a-multi-factor-portfolio-is-constructed-matters/ In this paper, Larry explains the advantage of a “bottom up” approach compared to a “component” approach to multi factor investing. A “bottom up” approach that decides on incorporation of individual stocks bas...
by Random Walker
Fri Oct 12, 2018 8:54 am
Forum: Investing - Theory, News & General
Topic: Unfortunate Near Real-Time Test of Sequence of Returns Risk v Probability of Retirement Success
Replies: 19
Views: 1721

Re: Unfortunate Near Real-Time Test of Sequence of Returns Risk v Probability of Retirement Success

Stocks decreased in value, which means expected returns increased a bit. I bet your calculator’s input expected returns did not change over the 48 hours but of course the input starting net worth was less. Overall I would say your success rate didn’t meaningfully change. If it’s a Monte Carlo Simula...
by Random Walker
Thu Oct 11, 2018 2:24 pm
Forum: Investing - Theory, News & General
Topic: 5 ways target-date funds let investors down
Replies: 38
Views: 3357

Re: 5 ways target-date funds let investors down

How is an investor just a few years away from retirement feeling about target date fund this week? Maybe he’s wishing he had customized his personal glide path a bit more then the target date funds decreasing equities 1-2% a year. I think it is wise for the investor to evaluate portfolio and future ...
by Random Walker
Thu Oct 11, 2018 2:18 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Why Emerging Markets Matter
Replies: 82
Views: 6189

Re: Larry Swedroe: Why Emerging Markets Matter

...2. I don't think countries graduate between emerging and developed markets often enough for internal rebalancing to make a material difference... Which, of course, obviously contradicts the premise behind the phrase "emerging markets." It also contradicts the frequently-expressed sentiment that ...
by Random Walker
Thu Oct 11, 2018 9:09 am
Forum: Investing - Theory, News & General
Topic: Allan Roth: Creating Alpha Through Beta Funds
Replies: 0
Views: 140

Allan Roth: Creating Alpha Through Beta Funds

https://www.etf.com/sections/index-investor-corner/creating-alpha-through-beta-funds Index funds generally trail their corresponding indexes by an amount equal to their fees. Some passive funds can do better than that without deviating significantly from their mandate to adhere to their benchmark. P...
by Random Walker
Thu Oct 11, 2018 8:20 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Hedge Fund’s & Undervalued Stocks
Replies: 1
Views: 382

Larry Swedroe: Hedge Fund’s & Undervalued Stocks

https://www.etf.com/sections/index-investor-corner/swedroe-hedge-funds-undervalued-stocks?nopaging=1 “The evidence from the study “Hedge Funds and Stock Price Formation” demonstrates both that hedge funds appear to have the ability to identify mispriced stocks, and their actions improve the price di...
by Random Walker
Wed Oct 10, 2018 4:59 pm
Forum: Investing - Theory, News & General
Topic: The benefits of international diversification - NOT: Hulbert
Replies: 80
Views: 5160

Re: The benefits of international diversification - NOT: Hulbert

I’m very curious too, and I don’t think I can predict what he would say at all.

Dave
by Random Walker
Wed Oct 10, 2018 8:54 am
Forum: Investing - Theory, News & General
Topic: The benefits of international diversification - NOT: Hulbert
Replies: 80
Views: 5160

Re: Mr. Bogle on "International Investing"

Jack Bogle makes some compelling arguments for NOT investing in ex-US, as a US investor: Here's Why Jack Bogle Doesn't Like Investing In Foreign Markets Vanguard Founder Jack Bogle on Mutual Funds, Common Sense Investing and the Stock Market Jack Bogle on Market Index Funds (2014) Bogle: Why I Don'...
by Random Walker
Tue Oct 09, 2018 10:25 pm
Forum: Investing - Theory, News & General
Topic: The benefits of international diversification - NOT: Hulbert
Replies: 80
Views: 5160

Re: The benefits of international diversification - NOT: Hulbert

For believers in the efficient market hypothesis (not myself), the super long-term difference in risk-adjusted returns between U.S. and international equities should be zero. But we unfortunate humans don't have the super long-term to invest. Our investment horizons are measured in comparably pitif...
by Random Walker
Tue Oct 09, 2018 8:20 pm
Forum: Investing - Theory, News & General
Topic: The benefits of international diversification - NOT: Hulbert
Replies: 80
Views: 5160

Re: The benefits of international diversification - NOT: Hulbert

International small value is likely a significantly better diversifier than international developed. Small companies much more affected by local economies. International large and US large more likely to be highly correlated. I think ISV diversification benefit same ballpark as EM.

Dave
by Random Walker
Tue Oct 09, 2018 9:00 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Why Emerging Markets Matter
Replies: 82
Views: 6189

Re: Larry Swedroe: Why Emerging Markets Matter

It’s interesting, the whole value / growth thing plays out at the country level too. Jeremy Siegel wrote a book called The Future For Investors, where he shows that if anything there is a negative relationship between a country’s GDP growth and returns to its stock markets. Seems whether it’s an ind...
by Random Walker
Tue Oct 09, 2018 8:41 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Why Emerging Markets Matter
Replies: 82
Views: 6189

Re: Larry Swedroe: Why Emerging Markets Matter

For the reasons I mentioned above DFA and Larry’s firm, BAM, recommend combining EM as much as possible into a total market or core fund, then adding extra EM to taste. I couldn’t help myself, and had to add a touch of EMV.

Dave
by Random Walker
Mon Oct 08, 2018 9:10 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Why Emerging Markets Matter
Replies: 82
Views: 6189

Re: Larry Swedroe: Why Emerging Markets Matter

Nisiprius, As you know, I’m not Larry, but I think he’d say the starting point is world market cap weighting. The US/Int split is about 50/50. EM I think makes up 20-25% of Int. This would imply a good starting point is %EM = 10-12.5% of equities. That being said, I’m sure it’s more important to sti...
by Random Walker
Mon Oct 08, 2018 9:26 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Why Emerging Markets Matter
Replies: 82
Views: 6189

Re: Larry Swedroe: Why Emerging Markets Matter

Strive for simplicity (read link below). Avoiding useless complexity makes sense. But for an asset class as volatile as emerging markets, I want to hold it separately. When it goes up 30% in a year, I want to rebalance out of it. When it drops 30% in a year, I want to rebalance into it. I've held a...
by Random Walker
Mon Oct 08, 2018 7:58 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Why Emerging Markets Matter
Replies: 82
Views: 6189

Larry Swedroe: Why Emerging Markets Matter

https://www.etf.com/sections/index-investor-corner/swedroe-why-emerging-markets-matter?nopaging=1 Over long term EM has outperformed US. EM is more risky, long periods of underperformance, different types of risk, market prices risk well, and EM less than perfectly correlated with US. A portfolio co...
by Random Walker
Sun Oct 07, 2018 3:38 pm
Forum: Investing - Theory, News & General
Topic: Why not a 2 fund portfolio like Bogle suggests
Replies: 79
Views: 13600

Re: Why not a 2 fund portfolio like Bogle suggests

I don't need to pay an investment advisor to pick the 'best debtors' if the only debtor is the US government and the only bonds are the risk-free asset. One of the reasons I chose to go advisor route was to hold a ladder of high quality municipal bonds in my taxable account. They’re not Treasuries,...
by Random Walker
Sun Oct 07, 2018 11:43 am
Forum: Investing - Theory, News & General
Topic: Is your risk tolerance to dollars or percentages?
Replies: 17
Views: 1185

Re: Is your risk tolerance to dollars or percentages?

PJW,
I agree, wouldn’t count on it. But does tend to occur.

Dave
by Random Walker
Sun Oct 07, 2018 11:13 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Examining Bond Premiums
Replies: 7
Views: 862

Larry Swedroe: Examining Bond Premiums

https://www.etf.com/sections/index-investor-corner/swedroe-examining-bond-premiums In this essay, using data covering 1927-2017, Larry reviews the size and volatility of the two risk premiums associated with bonds, term and credit. Very surprised to read just how risky and volatile the term premium ...
by Random Walker
Sun Oct 07, 2018 10:25 am
Forum: Investing - Theory, News & General
Topic: Is your risk tolerance to dollars or percentages?
Replies: 17
Views: 1185

Re: Is your risk tolerance to dollars or percentages?

If the person is comfortable at 50/50 with the first 1M, then the marginal benefit of the second 1M will be less. Moreover the marginal benefit of growing that second 1M will be much less. Probably not a lot of benefit to putting it at much risk. One could just put it all in bonds as an extra securi...
by Random Walker
Sun Oct 07, 2018 10:07 am
Forum: Investing - Theory, News & General
Topic: “It’s probably wise to sell to the sleeping point.” - Jack Bogle
Replies: 83
Views: 11463

Re: “It’s probably wise to sell to the sleeping point.” - Jack Bogle

I have a hard time understanding this concept: sell to the sleeping point. I am not sure what that actually means. It seems to me that in a recession/crisis, the correlation of stocks and bonds moves to '1', and both tank. Did people with a 50% allocation to bonds really sleep all that much better ...
by Random Walker
Sat Oct 06, 2018 10:34 pm
Forum: Investing - Theory, News & General
Topic: “It’s probably wise to sell to the sleeping point.” - Jack Bogle
Replies: 83
Views: 11463

Re: “It’s probably wise to sell to the sleeping point.”

If someone is close to retirement or in retirement and has the retirement secured, I’d say don’t mess around. Consider doing something more definitive than just 5-10% to lock in the gains of the last decade. Monte Carlo Simulation can be very helpful for these decisions. 8 weeks from retirement and...
by Random Walker
Sat Oct 06, 2018 9:28 pm
Forum: Investing - Theory, News & General
Topic: “It’s probably wise to sell to the sleeping point.” - Jack Bogle
Replies: 83
Views: 11463

Re: “It’s probably wise to sell to the sleeping point.”

If someone is close to retirement or in retirement and has the retirement secured, I’d say don’t mess around. Consider doing something more definitive than just 5-10% to lock in the gains of the last decade. Monte Carlo Simulation can be very helpful for these decisions. 8 weeks from retirement and...
by Random Walker
Sat Oct 06, 2018 3:34 pm
Forum: Investing - Theory, News & General
Topic: “It’s probably wise to sell to the sleeping point.” - Jack Bogle
Replies: 83
Views: 11463

Re: “It’s probably wise to sell to the sleeping point.”

If someone is close to retirement or in retirement and has the retirement secured, I’d say don’t mess around. Consider doing something more definitive than just 5-10% to lock in the gains of the last decade. Monte Carlo Simulation can be very helpful for these decisions.

Dave
by Random Walker
Sat Oct 06, 2018 9:32 am
Forum: Investing - Theory, News & General
Topic: AAII Interviews Larry Swedroe: Getting The Same Return With Less Risk: The Power Of Factors
Replies: 3
Views: 612

Re: AAII Interviews Larry Swedroe: Getting The Same Return With Less Risk: The Power Of Factors

I think you can reconcile the two definitions of correlations. You can make the CFI and Investopedia definitions fit within Larry’s. “Moving in opposite directions” = one performing above its average and one performing below its average. You’re making rebalancing too complicated. Just look at the va...
by Random Walker
Sat Oct 06, 2018 9:10 am
Forum: Investing - Theory, News & General
Topic: Vanguard's Shtekman and Xu beat Asness: Alt. Strategies (VASFX) vs. AQR (QSPIX)!
Replies: 18
Views: 1113

Re: Vanguard's Shtekman and Xu beat Asness: Alt. Strategies (VASFX) vs. AQR (QSPIX)!

I looked up the Vanguard fund on the Vanguard website. From the description, I have no idea what this fund does. I seriously doubt though that it’s an apples to apples comparison with QSPIX. Each fund is so unique with so many moving parts; likely different beasts. To me it looks like the AQR fund i...
by Random Walker
Fri Oct 05, 2018 5:11 pm
Forum: Investing - Theory, News & General
Topic: AAII Interviews Larry Swedroe: Getting The Same Return With Less Risk: The Power Of Factors
Replies: 3
Views: 612

AAII Interviews Larry Swedroe: Getting The Same Return With Less Risk: The Power Of Factors

https://www.aaii.com/journal/article/getting-the-same-return-with-less-risk-the-power-of-factors?acc=o This is an interview of Larry Swedroe by Charles Rotblut Of American Association Individual Investors. It provides an excellent summary of how factors and alternatives help achieve the goal of impr...
by Random Walker
Fri Oct 05, 2018 9:32 am
Forum: Investing - Theory, News & General
Topic: Key differences between investing philosophies: Swedroe vs. Bogle
Replies: 144
Views: 7580

Re: Key differences between investing philosophies: Swedroe vs. Bogle

Jack believes in portfolio simplicity. Larry believes in portfolio complexity. I believe in Jack. Rick Ferri Bogleheads: I believe in Jack and Rick Ferri. Best wishes. Taylor I believe in evidence-based investing, not people. OK, so post a graph of Jack's and Larry's approaches over the last 30 or ...
by Random Walker
Thu Oct 04, 2018 2:27 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Be Prepared For Losses
Replies: 100
Views: 12015

Re: Larry Swedroe: Be Prepared For Losses

Here's something I find a bit sobering.... Discussions above have focused on needing to be prepared for equities to drop by 50% and thus, depending on one's AA, likely a smaller drop in overall portfolio value. But those computations appear to be premised on fixed income maintaining its value. But,...
by Random Walker
Thu Oct 04, 2018 2:25 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Be Prepared For Losses
Replies: 100
Views: 12015

Re: Larry Swedroe: Be Prepared For Losses

nedsaid wrote:
Thu Oct 04, 2018 12:35 pm
Darn it, Dave. The day after you posted this, the US Stock Market drops! One could say that you were timely or one could say that you jinxed the market. Darn it anyway. :wink:
I don’t even have the power to make my 10yo brush his teeth, so I definitely didn’t cause any market moves!

Dave
by Random Walker
Thu Oct 04, 2018 11:45 am
Forum: Investing - Theory, News & General
Topic: Key differences between investing philosophies: Swedroe vs. Bogle
Replies: 144
Views: 7580

Re: Key differences between investing philosophies: Swedroe vs. Bogle

My sense is that most Bogleheads would simply change their equity-bond ratio if they wanted to take on more or less risk. what about fat tails and the risk of Black Swan events? Significant issue! One of the big contrasts between the Swedroe and Bogle approaches is that Swedroe is diversifying acro...
by Random Walker
Thu Oct 04, 2018 8:21 am
Forum: Investing - Theory, News & General
Topic: Key differences between investing philosophies: Swedroe vs. Bogle
Replies: 144
Views: 7580

Re: Key differences between investing philosophies: Swedroe vs. Bogle

Azanon, Hard to argue with you. Anytime I’ve made a change, I ask myself why I am making it over and over. For me, I don’t worry about performance chasing. My bigger psychological concern is whether I’m doing something just for the sake of adding something more unique or esoteric for some kind of co...
by Random Walker
Thu Oct 04, 2018 8:08 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Be Prepared For Losses
Replies: 100
Views: 12015

Re: Larry Swedroe: Be Prepared For Losses

In preparing for losses, we should not just think in terms of percentages. We should also think in terms of absolute dollar amount losses. I find that helps me clarify my risk tolerance a lot!

Dave
by Random Walker
Wed Oct 03, 2018 5:13 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Be Prepared For Losses
Replies: 100
Views: 12015

Re: Larry Swedroe: Be Prepared For Losses

look at the last crisis and so many could not retire IF a 50% loss does not affect your lifestyle, FINE, but for most it would be devastating Look up MARGINAL UTILITY OF WEALTH, then make your decision when you near retirement Totally agree. Behavioral research says pain of loss is twice as much as...
by Random Walker
Wed Oct 03, 2018 4:08 pm
Forum: Investing - Theory, News & General
Topic: Key differences between investing philosophies: Swedroe vs. Bogle
Replies: 144
Views: 7580

Re: Key differences between investing philosophies: Swedroe vs. Bogle

Well, I’m the guy who posts his articles. Just to be clear, I’m not promoting him or his business. I’m promoting the education he provides. As you wrote, there is overwhelming agreement between Swedroe and Bogle. They both certainly agree that markets are highly efficient, costs matter tremendously...
by Random Walker
Wed Oct 03, 2018 12:51 pm
Forum: Investing - Theory, News & General
Topic: Key differences between investing philosophies: Swedroe vs. Bogle
Replies: 144
Views: 7580

Re: Key differences between investing philosophies: Swedroe vs. Bogle

Jack believes in portfolio simplicity. Larry believes in portfolio complexity. I believe in Jack. Rick Ferri Why do you believe in a person rather than in the evidence? As far as I've understood, Swedroe's advice is based on the evidence provided by academic studies. Shouldn't peer reviewed studies...
by Random Walker
Wed Oct 03, 2018 12:37 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Be Prepared For Losses
Replies: 100
Views: 12015

Re: Larry Swedroe: Be Prepared For Losses

Munir, The “preparation” is not market timing or any short term adjustment. Like Homer J says, it is developing a long term investment policy that incorporates the assumption that big equity losses can happen at any time. Similar to Homer J, I assume equities can drop 50% in a 1-2 year time span. Ho...
by Random Walker
Wed Oct 03, 2018 12:25 pm
Forum: Investing - Theory, News & General
Topic: Key differences between investing philosophies: Swedroe vs. Bogle
Replies: 144
Views: 7580

Re: Key differences between investing philosophies: Swedroe vs. Bogle

Well, I’m the guy who posts his articles. Just to be clear, I’m not promoting him or his business. I’m promoting the education he provides. As you wrote, there is overwhelming agreement between Swedroe and Bogle. They both certainly agree that markets are highly efficient, costs matter tremendously,...
by Random Walker
Wed Oct 03, 2018 10:38 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Be Prepared For Losses
Replies: 100
Views: 12015

Larry Swedroe: Be Prepared For Losses

https://www.etf.com/sections/index-investor-corner/swedroe-be-prepared-losses?nopaging=1 Larry reviews a Fama French paper titled “Volatility Lessons”. He starts off reviewing the historic size of the market, size, and value premiums. He then begins to describe their riskiness by looking at the stan...
by Random Walker
Mon Oct 01, 2018 10:10 pm
Forum: Investing - Theory, News & General
Topic: Will size and value factor premia still exist in 20-30 years?
Replies: 13
Views: 1137

Re: Will size and value factor premia still exist in 20-30 years?

And looks like there is a significant diversification benefit to size. Clearly one day is meaningless, but S&P500 was up 0.36% while Russell 2K was down 1.39%. Long term size and market weakly correlated, value and market uncorrelated, and size and value uncorrelated.

Dave
by Random Walker
Mon Oct 01, 2018 8:12 pm
Forum: Investing - Theory, News & General
Topic: Will size and value factor premia still exist in 20-30 years?
Replies: 13
Views: 1137

Re: Will size and value factor premia still exist in 20-30 years?

I think size and value will persist. Looking forward, intuitively, they are both more risky than large growth. The expected return on an investment is its cost of capital, and it just makes sense to me that a small company or distressed company would pay a higher interest rate to finance its operati...
by Random Walker
Mon Oct 01, 2018 9:39 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Understanding The Financial Crisis
Replies: 4
Views: 630

Re: Larry Swedroe: Understanding The Financial Crisis

Looking at the causes of the crisis, I can’t help but think that no one ever blames the individual who bit off more than he could chew when he bought that house. An individual’s self approval of a loan should be way more critical than the bank’s approval.

Dave
by Random Walker
Mon Oct 01, 2018 9:35 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Understanding The Financial Crisis
Replies: 4
Views: 630

Re: Larry Swedroe: Understanding The Financial Crisis

Was really surprised to read that Japan, while almost 40% down from its 1989 peak, has more than tripled since 2009.

Dave
by Random Walker
Mon Oct 01, 2018 9:33 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Understanding The Financial Crisis
Replies: 4
Views: 630

Larry Swedroe: Understanding The Financial Crisis

https://www.etf.com/sections/swedroe-understanding-financial-crisis?nopaging=1 10 years after the Financial Crisis, Larry writes an excellent very readable summary of its causes. At the end, he enumerates 10 lessons investors can learn from the crisis. Another crisis will occur at some point, and it...