Search found 5165 matches

by rkhusky
Sat Jun 16, 2018 7:53 am
Forum: Investing - Help with Personal Investments
Topic: Cap weighted versus equal weighted index investment
Replies: 3
Views: 221

Re: Cap weighted versus equal weighted index investment

Equal weighted based on company name doesn’t make much sense. Consider a large entity like Kraft. If they split each of their brands into separate companies, does it make sense to increase your stake in those brands a hundred-fold? You would need to if you were equal weighted by company. A market ca...
by rkhusky
Fri Jun 15, 2018 8:41 am
Forum: Investing - Theory, News & General
Topic: Factor-based strategy is better (winer), OK. then who are the losers?
Replies: 55
Views: 2459

Re: Factor-based strategy is better (winer), OK. then who are the losers?

I know it’s an unpopular thought but I still think the longer the holding period, the less risky a riskier asset becomes. That needs some caveats. You need a diversified portfolio. Holding buggy maker or vacuum tube or Enron stocks long term did not reduce risk. Even with diversification, individua...
by rkhusky
Fri Jun 15, 2018 7:18 am
Forum: Investing - Theory, News & General
Topic: Diversified portfolio but still too much Apple, Microsoft, etc.
Replies: 13
Views: 1423

Re: Diversified portfolio but still too much Apple, Microsoft, etc.

If it helps, think of Apple as 5 or 6 separate companies lumped together under one ownership umbrella. You want your portfolio to be relatively indifferent to the ownership umbrella.
by rkhusky
Thu Jun 07, 2018 8:56 pm
Forum: Investing - Theory, News & General
Topic: Yes, you can diversify a market portfolio
Replies: 190
Views: 9363

Re: Yes, you can diversify a market portfolio

I don't agree that the smaller list is more diversified. Suppose that instead of picking 4 companies out of the original 10, Morgan Stanley bought the other 6 companies that were not chosen. You end up with the exact same 4 companies in your portfolio. Is there any difference in the diversification...
by rkhusky
Thu Jun 07, 2018 8:41 pm
Forum: Investing - Theory, News & General
Topic: Yes, you can diversify a market portfolio
Replies: 190
Views: 9363

Re: Yes, you can diversify a market portfolio

Perhaps, but I suppose we can agree that any major black swan event that affects Morgan Stanley is more like to affect other financial companies more than it impacts SO or GILD. If we have a global banking meltdown, owning both Morgan Stanley AND Goldman Sachs isn't likely to help your portfolio ve...
by rkhusky
Thu Jun 07, 2018 1:36 pm
Forum: Investing - Theory, News & General
Topic: Yes, you can diversify a market portfolio
Replies: 190
Views: 9363

Re: Yes, you can diversify a market portfolio

Imagine you started with an equal-weight portfolio of the following ten stocks: BAC (Bank of America Corporation) C (Citigroup Inc.) GILD (Gilead Sciences, Inc.) GS (Goldman Sachs Group, Inc.) JPM (J P Morgan Chase & Co) MS (Morgan Stanley) SO (Southern Company) USB (U.S. Bancorp) V (Visa Inc.) WFC...
by rkhusky
Thu Jun 07, 2018 6:54 am
Forum: Investing - Theory, News & General
Topic: Yes, you can diversify a market portfolio
Replies: 190
Views: 9363

Re: Yes, you can diversify a market portfolio

Thus it really comes down to how much one believes in the theory of multi-asset or factor investing and is willing to take their chances with investment portfolios that deviate from a standard neutral "market portfolio." Just my perspective. Yes, we invest looking forward. We don’t know what will h...
by rkhusky
Thu Jun 07, 2018 6:27 am
Forum: Investing - Theory, News & General
Topic: Yes, you can diversify a market portfolio
Replies: 190
Views: 9363

Re: Yes, you can diversify a market portfolio

vineviz wrote:
Wed Jun 06, 2018 7:42 pm
if you’re using all of the data available, it isn’t cherry picking.
True, but there are still coincidental time-dependent effects when one uses just one set of data. One should look at a variety of time periods to see if the hypothesis is robust.
by rkhusky
Tue Jun 05, 2018 9:02 pm
Forum: Investing - Theory, News & General
Topic: Yes, you can diversify a market portfolio
Replies: 190
Views: 9363

Re: Yes, you can diversify a market portfolio

VTSMX has virtually no exposure to the risk and style factors (small companies, value companies, quality companies, low beta stocks, etc.) This is a common misconception. VTSMX (Vanguard Total Stock Market) holds the market weight in nearly all U.S. "risk and style factors small companies, value co...
by rkhusky
Tue Jun 05, 2018 8:57 pm
Forum: Investing - Theory, News & General
Topic: Yes, you can diversify a market portfolio
Replies: 190
Views: 9363

Re: Yes, you can diversify a market portfolio

Total Stock Market has thousands of small-cap companies and only hundreds of large cap companies. By that measure, it is overweight in small caps. Total Stock Market has equal percentages of the investable shares for all the companies in its portfolio. By that measure, it is perfectly diversified. Y...
by rkhusky
Tue Jun 05, 2018 6:53 am
Forum: Investing - Theory, News & General
Topic: Do bond funds lose value while CDs do not?
Replies: 31
Views: 3340

Re: Do bond funds lose value while CDs do not?

As an example, Vanguard Total Bond (VBMFX) had prices of 10.38, 10.26, 11.00, 10.98, 10.52 on dates 3/31/03, 3/31/08, 3/31/13, 3/31/15, 3/31/18, respectively. The 10-yr, 5-yr, 3-yr returns were 3.46%, 1.62%, 1.02%, respectively (not sure how to find the 15-yr return, corresponding to 3/31/03). Note ...
by rkhusky
Tue Jun 05, 2018 6:16 am
Forum: Investing - Help with Personal Investments
Topic: Why do I have a wash sale disallowance?
Replies: 12
Views: 1452

Re: Why do I have a wash sale disallowance?

Now, two more follow up questions: Easy one first: what is the significance of the $157 disallowance? My total (short-term) loss was $501.52 (=148.39 + 181.92 + 171.21[adj]). Does this mean I can really only use $344.52 (= 501.52 - 157.00) for tax loss harvesting? Who chooses which lot (09/20 vs. 0...
by rkhusky
Tue Jun 05, 2018 5:58 am
Forum: Investing - Theory, News & General
Topic: Do bond funds lose value while CDs do not?
Replies: 31
Views: 3340

Re: Do bond funds lose value while CDs do not?

Again, assume that interest rates do not change and I am not reinvesting because I am using all of the dividends/interest paid. My experience has been that while both will pay me the $3k in dividends/interest annually for five years, the ending value of the CD after five years will be $100k but the...
by rkhusky
Mon Jun 04, 2018 5:53 pm
Forum: Investing - Help with Personal Investments
Topic: Why do I have a wash sale disallowance?
Replies: 12
Views: 1452

Re: Why do I have a wash sale disallowance?

The 63 shares purchased on 11/16 were considered replacement shares for 63 of the shares purchased on 9/22, which were sold less than 30 days after the replacement shares were purchased. The amount disallowed was therefore (63/136) * (1,158.24 - 819.33) = 157.00. If you paid 6.25/sh on 11/16, then, ...
by rkhusky
Mon Jun 04, 2018 7:10 am
Forum: Personal Consumer Issues
Topic: How a credit card refund is applied?
Replies: 25
Views: 1435

Re: How a credit card refund is applied?

My question, will the $1,500 refund be applied to pay off my last statement balance, so I only pay $1,500 for the total balance? Yes, as long as the credit is posted before the statement due date. If I have a credit that comes after the current statement date but before the due date, I have often s...
by rkhusky
Mon Jun 04, 2018 7:02 am
Forum: Investing - Theory, News & General
Topic: Do bond funds lose value while CDs do not?
Replies: 31
Views: 3340

Re: Do bond funds lose value while CDs do not?

Has their been a time when interest rates and expectations have stayed sufficiently flat that one could separate the signal from noise?
by rkhusky
Sun Jun 03, 2018 9:47 pm
Forum: Investing - Help with Personal Investments
Topic: TSP Advice - Retiring Soon
Replies: 18
Views: 1540

Re: TSP Advice - Retiring Soon

Rollover a portion of the TSP to a Traditional IRA and do Roth conversions to the top of the 12% or 24% bracket, depending on what you expect your marginal rate will be after age 70.
by rkhusky
Sun Jun 03, 2018 9:42 pm
Forum: Investing - Help with Personal Investments
Topic: Bonds in Roth IRA
Replies: 24
Views: 1478

Re: Bonds in Roth IRA

Another option is to put corporate bonds, which are riskier and higher yielding, in the Roth and use the short term bond in the 401k.
by rkhusky
Sun Jun 03, 2018 5:59 am
Forum: Investing - Help with Personal Investments
Topic: Bonds in Roth IRA
Replies: 24
Views: 1478

Re: Bonds in Roth IRA

If you are in a higher tax bracket, 22%+, you might also look at a muni bond fund in taxable (need to check return vs taxable bond and state tax rate also comes into play). You could also put a bit of money in the short bond in the 401k and the rest of bonds in the Roth IRA.
by rkhusky
Sat Jun 02, 2018 8:00 pm
Forum: Investing - Help with Personal Investments
Topic: VASGX with 25-30 year investment plan. Looking for advice. [Vanguard LifeStrategy Growth]
Replies: 31
Views: 2367

Re: VASGX with 25-30 year investment plan. Looking for advice. [Vanguard LifeStrategy Growth]

Best investment I ever made, hopefully will never need to sell. The 20% in bonds is perfect to reduce the froth in the global markets. Thank you for your response. I have been nervous about bonds since I have had so many say they are not worth it anymore. This is a great time to invest in bonds. In...
by rkhusky
Sat Jun 02, 2018 5:53 am
Forum: Personal Finance (Not Investing)
Topic: wash sale question
Replies: 4
Views: 375

Re: wash sale question

Based on the examples in http://fairmark.com/capgain/wash/wsreplac.htm, particularly Example 4, it seems like you should be safe, even if the May 1 & 15 shares had a loss. To avoid confusion, perhaps sell the May 1 & 15 shares on May 24 and then the older shares with a loss on May 25. edit: the reas...
by rkhusky
Fri Jun 01, 2018 1:06 pm
Forum: Investing - Theory, News & General
Topic: Equal weight for index fund?
Replies: 51
Views: 2924

Re: Equal weight for index fund?

What I'm describing is a returns-based style analysis, a technique that William Sharpe (the Sharpe Ratio guy) described back in the 1980s. It's a way of analyzing and evaluating an asset (stock, fund, asset class, etc.) by running a regression of its returns against some number of style or risk fac...
by rkhusky
Fri Jun 01, 2018 11:12 am
Forum: Investing - Theory, News & General
Topic: Equal weight for index fund?
Replies: 51
Views: 2924

Re: Equal weight for index fund?

A more efficient way to achieve approximate equal weighting is to divide stocks into size bins and then market-cap weight within each bin and equal weight between bins. 3-10 bins should suffice, depending on how close to equal weighting one wants to get.
by rkhusky
Thu May 31, 2018 4:49 pm
Forum: Personal Finance (Not Investing)
Topic: Employer Forcing Transfer of 529
Replies: 15
Views: 1916

Re: Employer Forcing Transfer of 529

This wiki article might have some useful information:
https://www.bogleheads.org/wiki/529_pla ... _transfers
by rkhusky
Thu May 31, 2018 10:49 am
Forum: Investing - Help with Personal Investments
Topic: Updated (May 2018) TSP Withdrawal Options from FRTIB
Replies: 9
Views: 715

Re: Updated (May 2018) TSP Withdrawal Options from FRTIB

LinusP wrote:
Thu May 31, 2018 9:20 am
It might be good for someone to update the wiki at some point: https://www.bogleheads.org/wiki/TSP_withdrawals
Probably better to wait until the changes are actually implemented.
by rkhusky
Thu May 31, 2018 5:49 am
Forum: Personal Consumer Issues
Topic: Hotel Charged on Reservation vs Actual Night Stayed?
Replies: 31
Views: 1756

Re: Hotel Charged on Reservation vs Actual Night Stayed?

Assuming you've gone as far as you can with the hotel management, another option is to post your experience on some place like Yelp before disputing with the CC company. Just list your expectations and the hotel's response in polite terms. I don't see any difference for the hotel between cancelling ...
by rkhusky
Thu May 31, 2018 5:18 am
Forum: Investing - Help with Personal Investments
Topic: Should I shift bond allocation from F Fund to G Fund?
Replies: 15
Views: 1053

Re: Should I shift bond allocation from F Fund to G Fund?

Given that everyone knows about the rate increases, that information is already priced into the F Fund, so it is too late to shift now. It would be more productive to consider a long term plan for your bond holdings. The F Fund contains 70% Treasuries (intermediate on average) and 30% Corporate bond...
by rkhusky
Wed May 30, 2018 10:10 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard Account "profile" is not complete !?
Replies: 13
Views: 1040

Re: Vanguard Account "profile" is not complete !?

I find the whole opening page a waste. I usually go immediately to my account balances page. I wish I could set that as the default, but I expect that Vanguard knows best, just like Google, Apple and Microsoft, as well as my bank. I expect they pay a lot for web design and they don’t want their user...
by rkhusky
Wed May 30, 2018 3:45 pm
Forum: Investing - Help with Personal Investments
Topic: Rebalancing by buying/selling the same fund in different accounts
Replies: 2
Views: 314

Re: Rebalancing by buying/selling the same fund in different accounts

If you end up with the same amount of Total Stock after the transactions, there is no problem. You could perhaps structure things so that you don't need to involve TSM if the rebalancing is not between stocks/bonds, but it doesn't seem like your current system is much of a burden. One potential prob...
by rkhusky
Wed May 30, 2018 1:58 pm
Forum: Investing - Theory, News & General
Topic: Equal weight for index fund?
Replies: 51
Views: 2924

Re: Equal weight for index fund?

Assuming that we have no information about which companies will do better or worse, the optimal portfolio should have an equal amount invested in every company. Without extra information , there is no reason that we should invest more in Amazon than in Chipotle, or in Robert's store down the street...
by rkhusky
Wed May 30, 2018 8:36 am
Forum: Investing - Theory, News & General
Topic: Equal weight for index fund?
Replies: 51
Views: 2924

Re: Equal weight for index fund?

Equal weight funds also suffer from a logic issue regarding conglomerates. Suppose Apple split into 10 different companies. Does it make sense that an investor would want to increase his stake in Apple products by 10x, just because of the split? There would be no change required for the market cap i...
by rkhusky
Wed May 30, 2018 6:28 am
Forum: Investing - Help with Personal Investments
Topic: Why not divide up holdings based on time horizon?
Replies: 10
Views: 1048

Re: Why not divide up holdings based on time horizon?

I'm aware of the analysis at https://www.bogleheads.org/wiki/ETFs_vs_mutual_funds but which do you prefer? Do you do one in the taxable account and the other in the tax-advtanged accounts? I'm thinking ETF in taxable, mutual fund in tax advantaged. I don't have a preference. I don't think it matter...
by rkhusky
Wed May 30, 2018 6:10 am
Forum: Investing - Help with Personal Investments
Topic: Asset allocation help for a newbie
Replies: 6
Views: 593

Re: Asset allocation help for a newbie

401k plan is ok with max fees of 0.7-0.8% for vanguard funds, more for others. Below is a list of vanguard funds in my plan by asset type: I think you may have got that off by a decimal point - e.g. ER for VTSAX is 0.04%. Many 401k plans tack on additional fees to cover admin costs. You could also ...
by rkhusky
Tue May 29, 2018 8:21 pm
Forum: Investing - Help with Personal Investments
Topic: Altering REIT exposure with home ownership
Replies: 8
Views: 803

Re: Altering REIT exposure with home ownership

If you own Total Stock Market, you own REIT's, and so, are already diversified. And the Small Cap index has an even larger percentage in Real Estate - 11%. Yes, but that is not the OP question. The question is not of exposure but getting the right level of exposure. Thanks to tax law the market in ...
by rkhusky
Tue May 29, 2018 8:18 pm
Forum: Investing - Help with Personal Investments
Topic: Please help with 401k options
Replies: 9
Views: 618

Re: Please help with 401k options

The Target Retirement and LifeStrategy funds both have 40% of stocks in International, 60% in US. As noted above, the primary difference is that the Target Retirement funds slowly reduce the stock percent as you get closer and beyond the target date (reaches 50/50 at the target date and terminates a...
by rkhusky
Tue May 29, 2018 6:27 am
Forum: Investing - Help with Personal Investments
Topic: Altering REIT exposure with home ownership
Replies: 8
Views: 803

Re: Altering REIT exposure with home ownership

If you own Total Stock Market, you own REIT's, and so, are already diversified. And the Small Cap index has an even larger percentage in Real Estate - 11%.
by rkhusky
Mon May 28, 2018 1:03 pm
Forum: Investing - Theory, News & General
Topic: Post Your Morningstar Box Style
Replies: 111
Views: 8422

Re: Post Your Morningstar Box Style

Note that Morningstar changed its size definitions at the beginning of the year. So, numbers posted earlier this year, using 2017 definitions, will look different now.
by rkhusky
Sun May 27, 2018 5:56 am
Forum: Personal Finance (Not Investing)
Topic: Is backdoor Roth IRA eliminated in 2018?
Replies: 19
Views: 3575

Re: Is backdoor Roth IRA eliminated in 2018?

rhinopylon wrote:
Sat May 26, 2018 6:38 pm
At this point they might as well just allow a direct contribution.
Leaving it the way it is potentially provides more tax revenue to the government, due to the mixing of existing Traditional account balances into the Roth conversion step of the process.
by rkhusky
Sat May 26, 2018 7:50 pm
Forum: Personal Finance (Not Investing)
Topic: Experian will not lift security freeze with PIN
Replies: 14
Views: 2562

Re: Experian will not lift security freeze with PIN

Some years ago I had trouble unfreezing Experian, even though I had the right PIN. After I finally got it to work, I found the problem: To verify my identity, they had me provide a bunch of stuff, including our home phone number. They had a phone number on-file that had not been in use for about 7 ...
by rkhusky
Sat May 26, 2018 5:58 am
Forum: Investing - Help with Personal Investments
Topic: Tracking Federal TSP (Specifically Interfund Transfers)
Replies: 5
Views: 514

Re: Tracking Federal TSP (Specifically Interfund Transfers)

If you have the shares before and after, simply subtract the former from the latter to determine shares bought or sold (positive number = bought). Yea but it doesn’t break down Roth and traditional. I was going to do that. And to try and figure out the proportions is almost impossible. Then you may...
by rkhusky
Sat May 26, 2018 5:45 am
Forum: Investing - Help with Personal Investments
Topic: Tracking Federal TSP (Specifically Interfund Transfers)
Replies: 5
Views: 514

Re: Tracking Federal TSP (Specifically Interfund Transfers)

If you have the shares before and after, simply subtract the former from the latter to determine shares bought or sold (positive number = bought).
by rkhusky
Fri May 25, 2018 7:06 am
Forum: Investing - Help with Personal Investments
Topic: Should I open a traditional IRA for bond allocation?
Replies: 14
Views: 614

Re: Should I open a traditional IRA for bond allocation?

Put stocks in taxable and and stocks and bonds in your Roth. Or just go all stocks for now. Make sure that you can deduct a Traditional IRA contribution. If not, continue to use Roth. If you can deduct the Traditional contributions, see https://www.bogleheads.org/wiki/Traditional_versus_Roth, to hel...
by rkhusky
Thu May 24, 2018 6:35 am
Forum: Investing - Help with Personal Investments
Topic: Worth opening a 529?
Replies: 5
Views: 637

Re: Worth opening a 529?

But from what I am hearing, I can open a PA 529 and deduct the state taxes, even if I then withdraw the money this year as well. You should check your state tax forms to see how they handle contributions and withdrawals. For example, my state (not PA) has the following language: You may deduct, to ...
by rkhusky
Wed May 23, 2018 8:47 pm
Forum: Investing - Help with Personal Investments
Topic: Which Roth IRA and Roth 401-k assets for dividend income
Replies: 9
Views: 413

Re: Which Roth IRA and Roth 401-k assets for dividend income

Most here are more concerned with total return, i.e. dividends + capital gain. A Vanguard Target Retirement fund or a Lifestrategy fund is fully diversified. It has thousands of US and Int'l stocks and thousands of US and Int'l bonds. The main difference between the two is that the TR funds slowly s...
by rkhusky
Wed May 23, 2018 9:27 am
Forum: Personal Finance (Not Investing)
Topic: Can I max out TSP and do a traditional IRA?
Replies: 9
Views: 1028

Re: Can I max out TSP and do a traditional IRA?

I get a different number from $400 though. I get $2,900. I admit I've never file form 8880 before, but the calculations look fairly easy. Line 6 is the smaller of contributions or $2000 for each ($2000 each for OP). Line 7 adds the two together ($4000 for OP). Line 9 is the percent (0.1 for the OP)...
by rkhusky
Wed May 23, 2018 7:00 am
Forum: Investing - Theory, News & General
Topic: Typical interest rate earned by target date funds in retirement?
Replies: 28
Views: 2030

Re: Typical interest rate earned by target date funds in retirement?

Based on all the work done on safe withdrawal rates and corresponding AA, Vanguard and other target date fund providers definitely seem to be catering to the risk-averse crowd with their terminal AA. Historic success rates for the '4% rule' have been highest with higher stock allocations, usually i...
by rkhusky
Wed May 23, 2018 6:40 am
Forum: Personal Finance (Not Investing)
Topic: Can I max out TSP and do a traditional IRA?
Replies: 9
Views: 1028

Re: Can I max out TSP and do a traditional IRA?

Via the Savers Credit, you can get back 10% of each of your retirement contributions (max of $2K each) if your AGI is between $41K and $63K. So, in terms of the Savers Credit, you will get back $400 whether you use Traditional or Roth IRA.
by rkhusky
Tue May 22, 2018 8:54 pm
Forum: Investing - Theory, News & General
Topic: Typical interest rate earned by target date funds in retirement?
Replies: 28
Views: 2030

Re: Typical interest rate earned by target date funds in retirement?

Based on all the work done on safe withdrawal rates and corresponding AA, Vanguard and other target date fund providers definitely seem to be catering to the risk-averse crowd with their terminal AA. Historic success rates for the '4% rule' have been highest with higher stock allocations, usually i...
by rkhusky
Tue May 22, 2018 8:45 pm
Forum: Investing - Help with Personal Investments
Topic: All else aside - General Allocation Thoughts
Replies: 9
Views: 801

Re: All else aside - General Allocation Thoughts

Either is fine. Returns are too noisy to be able to differentiate your two allocations. You'll do best to pick one and stick with it, apart from any stock/bond glide path that you might employ.
by rkhusky
Tue May 22, 2018 3:02 pm
Forum: Investing - Help with Personal Investments
Topic: Same funds within IRA and Taxable
Replies: 26
Views: 1808

Re: Same funds within IRA and Taxable

The fact that the IRS has not directly addressed 401(k)'s does bring some doubt. However, with the text as given, the inclusion of 401(k)'s in wash sale rules is on stronger footing than not including them. So you think they felt it important to issue a revenue ruling that specifically discussed IR...