Search found 283 matches

by Occupier
Tue Jun 25, 2013 2:40 pm
Forum: Investing - Theory, News & General
Topic: The Wrong Kind Of Diversification
Replies: 17
Views: 3021

Re: The Wrong Kind Of Diversification

Diworsification. That was a word invented by Peter Lynch (former manager of Magellan fund) to describe buying into something not really uncorrelated. Good word to remember. Dave
by Occupier
Tue Jun 25, 2013 12:12 pm
Forum: Personal Investments
Topic: MUB a decent ETF for Muni exposures
Replies: 5
Views: 1692

Re: MUB a decent ETF for Muni exposures

I don't have a problem with your equity allocation. If your going to have one muni fund/etf I suggest you check out TFI. Last time I looked it had a less aggressive duration which is correct in this kind of market. If you went MUB you might want to reduce average duration by holding a short term muni fund/etf as well. This advice is in recognition that interest rates still are near historic lows, and the most likely direction is up at some unknown rate of increase. Dave
by Occupier
Tue Jun 25, 2013 12:00 pm
Forum: Personal Investments
Topic: Emerging Market Equities Allocation
Replies: 9
Views: 1233

Re: Emerging Market Equities Allocation

Emerging markets traditionally have a low correlation with the US and other developed markets. Also they are a bit riskier than developed. This presents an opportunity. If you hold a number of riskier non correlated assets. You reduce volatility - due to the low correlation - and increase the risk level at the same time. Since risk theoretically, and over longer periods of time usually is rewarded with higher returns, you increase returns without having increased overall risk. So you should have some EM and I think market weight is appropriate such as by just holding VEXUS or Vanguard Total International. To put this in laymen's terms. If you hold assets which do not go up and down together, they will even out because one will be going up w...
by Occupier
Tue Jun 25, 2013 9:14 am
Forum: Investing - Theory, News & General
Topic: "Is Your Allocation a Good Fit For Your Risk Tolerance?"
Replies: 4
Views: 1087

Re: "Is Your Allocation a Good Fit For Your Risk Tolerance?"

Yup. I put it differently. The one sure way to lose money is to sell out at a low and miss a recovery.

If your going to panic and sell stocks you need to hold more bonds. If your going to panic and sell bonds, you need a shorter duration. You do NOT need a duration longer than intermediate under any circumstance BTW. Rates are at historic lows and are in the range where it is mathematically impossible for them to decline further. Dave
by Occupier
Tue Jun 25, 2013 9:00 am
Forum: Personal Investments
Topic: Bond reassurance.... Anyone?
Replies: 23
Views: 3004

Re: Bond reassurance.... Anyone?

Here are sample durations. Short term 3, Intermediate 6, and long 15. In a rising rate environment where rates go up by 1% the funds loose 3, 6, and 15% for each 1% increase in rates. To get to historically normal rates, which may or may not happen, we are looking at a 2-3% increase over time. Do the math. But duration is not the whole story you do get a bit back in the form of higher rates, but being too long means you have to wait a long time to get your money back. Dave
PS Think about it and I think you will see that you don't want to be longer than intermediate.
by Occupier
Mon Jun 24, 2013 6:17 pm
Forum: Personal Investments
Topic: Full Portfolio Disclosure - Appreciate Any Feedback
Replies: 6
Views: 1953

Re: Full Portfolio Disclosure - Appreciate Any Feedback

Am I correct 15% or so in bonds. That is really high risk at your age. Given that your a bit behind the curve I might increase that to 25-30%, but the rule of thumb is age in bonds. The target fund is not as tax efficient as having a broad market index such as total stock market (or total International) in taxable. That is because the target fund has taxable bonds - you want those in retirement. You might want to reduce the expensive funds in the retirement that .7+ expense ration adds up to quite a bit of lost appreciation over time. Dave
by Occupier
Sun Jun 23, 2013 5:43 pm
Forum: Personal Investments
Topic: Asset allocation for inherited IRA
Replies: 3
Views: 491

Re: Asset allocation for inherited IRA

Age in bonds is just a rule of thumb. Most agree you can depart from it to find a comfort level. Comfort level is more important. The one way to lose money for sure is to be insecure with a portfolio you control, sell out at a low and miss a recovery. Just a guess, but how about 30% bonds. Since the kid is going to control the money at majority, your not responsible for it for a whole lifetime. Being responsible tends to make one more conservative. Dave
by Occupier
Sun Jun 23, 2013 12:55 pm
Forum: Personal Investments
Topic: Bonds - How about Metro West -MWCRX and Osterweiss OSTIX ?
Replies: 2
Views: 1308

Re: Bonds - How about Metro West -MWCRX and Osterweiss OSTIX

The first sentence is a come on used over and over by active fund managers. But over time the higher costs of actively managed funds and their occasional mistakes mean they under perform indexes. Go read some books by Larry Swedroe, or William Bernstein. They are in most library's.

The new Vanguard fund is a part of a correctly structured portfolio. But only a part. Look these funds over in addition to the new fund; Vanguard Short Term Investment Grade, (or intermediate term). Vanguard Total Bond. Something like 40% in the short term fund, 40% in intermediate or total bond, and 20% in the new international fund would be a logical choice to hold through the years. Dave
by Occupier
Sun Jun 23, 2013 12:39 pm
Forum: Personal Investments
Topic: Moving away from cash
Replies: 15
Views: 2446

Re: Moving away from cash

If I were you I would explore the wiki this site. Especially books to read, and sample portfolios. You look like you just got investments scatter shot because they sounded good at the time you had some money. When you own a lot of actively managed funds from different providers you tend to just hold something like the Vanguard Total Stock market (and total international) in a very tax and cost inefficient manner. If I were you I wold just hold the three Vanguard total funds, US stock market 40%, International 30%, and total bond 30%. And I would take that cash and buy a house. Dave
by Occupier
Thu Jun 20, 2013 8:46 pm
Forum: Personal Investments
Topic: Help me pick a short term bond fund
Replies: 14
Views: 1463

Re: Help me pick a short term bond fund

Did you notice the DWS fund had a 68 percent turnover. A high yield and lower duration can be explained several ways. The one I think is true is that the DWS fund has purchased at a premium a lot of long term higher yielding bonds that are about to pay off. That will get the yield up, but the NAV which people don't have to talk about will go down. Dave
by Occupier
Thu Jun 20, 2013 2:41 pm
Forum: Investing - Theory, News & General
Topic: Bond funds if interest rates rise
Replies: 5
Views: 1483

Re: Bond funds if interest rates rise

Remember that if interest rates rise, bond funds loose their NAV by the duration, but they then yield more. So your paid back. The actually correct way to look at duration is the bonds decline by their duration, but you only loose the duration for every 1% rise in rates, less the increase in rate. Say you have a fund which yields 3% and has a duration of 4. Rates go up 1% during a year which sends the NAV down 4% but the loss is only 3% because of the higher rate your getting. And you get that higher rate into the future. The other problem with selling out is if you do, and leave the funds in a money market, then your basically getting no interest, and further you have to make a correct decision about when to get back in. I will tell you my...
by Occupier
Thu Jun 20, 2013 11:28 am
Forum: Personal Investments
Topic: ETF Bond Ladders
Replies: 2
Views: 781

Re: ETF Bond Ladders

Never heard of it. My thinking is you should pick an average duration you are comfortable with and stick to it. Something in the 4-5 range is OK with me given the fact that yields are at historic lows and likely to go up at some unknown point and speed in the future. That can entail having both a short term and intermediate term bond fund, but not anything longer. Note with an individual bond your always going to get the bonds face value back at maturity, hence the utility of a ladder. But funds don't mature and pay off like an individual bond. Take a look at the NAV of Vanguard High Yield Bond Fund. It's gone down over the years with consistency (your reimbursed for this with the higher yield). So thinking of holding funds as a ladder make...
by Occupier
Wed Jun 19, 2013 9:08 pm
Forum: Personal Investments
Topic: Portfolio Review & Advice for Young Investor
Replies: 4
Views: 633

Re: Portfolio Review & Advice for Young Investor

Those T Rowe funds are about 10 times more expensive than Admiral Vanguard Total US Market and close to that for Total int. Admiral. If you went out to dinner would you order a meal that cost ten times more than a similar meal? Since your unemployed go to your library and see what books they have written by Larry Swedroe, or William Bernstein, or Rick Ferri. I read those. Followed their advice and I have not worried since. You could easily do a 5-6 fund portfolio that with rebalancing would serve you for life. Dave
by Occupier
Wed Jun 19, 2013 2:29 pm
Forum: Personal Investments
Topic: Ishares vs Vanguard ETF
Replies: 8
Views: 7485

Re: Ishares vs Vanguard ETF

Yes I don't trust Ishares. The fact they are stockholder owned means that they have to make more money than Vanguard. There was no better example than with their emerging markets fund. They were not gaining assets due to low cost competition from Vanguard so they created a almost identical new EM etf - the differences are window dressing - so they could compete with Vanguard, but you can't trade out of EEM into the new fund unless you mind paying Capital Gains Taxes. Were they have a unique fund you want to hold, it's OK to buy in, but you can at least trust Vanguard not to try to screw you like that. Dave
by Occupier
Tue Jun 18, 2013 7:19 pm
Forum: Investing - Theory, News & General
Topic: Do you overweight emerging markets?
Replies: 83
Views: 11458

Re: Do you overweight emerging markets?

Yes I am overweight in EM. I got into them and China in a fairly big way in the beginning of the last decade. I bailed on China near the top, but I hate paying capital gains taxes and did not bail on EM. So the last year or so does not make me happy. I will get to market weight eventually which is where you should be. There are still good reasons to hold EM as Larry pointed out. I might add low correlation and a lot of potential, but if I was going to take a flyer these days I would be more interested in FM, the frontier markets etf. But I will tell you, both funds have a characteristic I don't like. When an emerging market gets really good like South Korea, it gets booted up to developed. Also when a developed market goes bad, like Greece,...
by Occupier
Tue Jun 18, 2013 10:14 am
Forum: Investing - Theory, News & General
Topic: Total "International Bond Index Fund: Why and how we hedge."
Replies: 4
Views: 1728

Re: Total "International Bond Index Fund: Why and how we hed

Good explanation Frengo. Ironically I was flipping through Larry Swedroes second book, What Wall Street Doesn't You to Know, and hit his advice about hedging on page 308 and 309. The subchapter is titled to hedge or not to hedge, that is the question. He says never hedge International Stocks because currency risk there tends to reduce your PORTFOLIO's volatility because currency movements are a part of international stocks having a lower correlation with US and the lower correlation reduces risk. I.e. hedging int. stocks makes their movements more similar to US thus reducing their value as a diversifier. But he gives the exact opposite advice for international bonds. His explanation is similar to yours. Hedging reduces volatility and since ...
by Occupier
Mon Jun 17, 2013 5:34 pm
Forum: Investing - Theory, News & General
Topic: Total International Bond Index Portfolio
Replies: 3
Views: 833

Re: Total International Bond Index Portfolio

Ok I posted a reply, got a rebuttal? Dave
by Occupier
Mon Jun 17, 2013 5:32 pm
Forum: Investing - Theory, News & General
Topic: Total "International Bond Index Fund: Why and how we hedge."
Replies: 4
Views: 1728

Re: Total "International Bond Index Fund: Why and how we hed

I have posted a couple of times on this subject but I have not seen any convincing answer, if someone who knows better, please explain, but I can't make sense of hedging. From about 2000 to 2007 the dollar lost about a third of it's value against the world currencies mentioned, euro, yen etc. Hedging would not change that because you made money because the world currency, euro etc. in the global bond went up. The cost of hedging was just a drag on your returns. You paid to cover a risk that did not occur. Now, in the last year the yen has declined by more than 20%. Hedging would have limited that kind of loss, but the cost of hedging i.e. defending against that kind of decline, must be higher than .3 or the people selling the forward contra...
by Occupier
Mon Jun 17, 2013 10:20 am
Forum: Investing - Theory, News & General
Topic: VTI or VIG as a core U.S Stock Market Holding
Replies: 27
Views: 11088

Re: VTI or VIG as a core U.S Stock Market Holding

I am not against tilting, but you start with the total market and then tilt, not starting with just a section of the market e.g. large blend, and then maybe tilt. Dave
by Occupier
Mon Jun 17, 2013 10:17 am
Forum: Investing - Theory, News & General
Topic: Total International Bond Index Portfolio
Replies: 3
Views: 833

Re: Total International Bond Index Portfolio

I would love to get straitened out by someone who knows beter,but I cant make sense of hedging. From about 2000 to 2007 the dollar lost about a third of it's value against the world currencies mentioned euro, yen, etc. Hedging would not change that, because you made money because the currency (euro etc..) of the global bond went up. The cost of hedging was just a drag. Now in the last year the yen has declined by a bit more than 20%. Hedging would have eliminated that kind of loss, but the cost to defend against that kind of decline must be higher than .3 or the people selling the forward contracts would go bankrupt. It just seems to me to be a huge cost that Vanguard does not include in the funds expense ratio. I buy the diversity argument...
by Occupier
Mon Jun 17, 2013 9:56 am
Forum: Investing - Theory, News & General
Topic: M*: High Correlation In 2013 Between Treasuries & Corporates
Replies: 11
Views: 1046

Re: M*: High Correlation In 2013 Between Treasuries & Corpor

Markets move around, if you can't stand a little volatility don't look. Right now I think you should be more concerned with duration than whether you emphasize corporates (investment grade) or treasuries. If your duration is long and credit risk high - as high yield - you need your head examined. Interest rates and credit spreads are at historic lows with rates and spreads likely to return to historically normal levels at some unknown point in the future. As that happens longer duration bonds are going to do a lot worse than intermediate or shorter and lower rated credit bonds are going to decline as their yields return to normal spreads. As an example, I have a muni bond ladder and it's really an exasperation to have to replace things as t...
by Occupier
Fri Jun 14, 2013 10:35 pm
Forum: Investing - Theory, News & General
Topic: VTI or VIG as a core U.S Stock Market Holding
Replies: 27
Views: 11088

Re: VTI or VIG as a core U.S Stock Market Holding

Your actual question, if translated properly, is should I hold a total market fund, or a large blend fund. The former being VTI and the latter VIG. I would say VTI because of lower costs, and greater exposure to more risky (e.g. volatile) asset classes that over time have returned more. VIG is a good fund, but look at what it is composed of, i.e. large capitalization, dividend paying companies. As soon as you have bought it, you then say, gosh I should get some small stocks to add diversity to the fact I just bought a large blend fund. As soon as you do this you go out and get a small cap fund. The result is you have a portfolio that resembles VTI at a much higher cost. Here is some information I think you need to understand. By market cap ...
by Occupier
Thu Jun 13, 2013 9:59 am
Forum: Personal Consumer Issues
Topic: Business Travel to Tijuana/Tecate/Ensenada
Replies: 35
Views: 4082

Re: Business Travel to Tijuana/Tecate/Ensenada

I have been to all the places you mention in the last year. I travel by motorcycle. You can cross the boarder in Tecate in a flash and then it's a nice rural two lane road to Ensenada with one or two checkpoints. I have never felt unsafe on the road or in either cities but I would not be out late at night. Tijuana is a big city and like any big city has some rough neighborhoods. Like others have said most of the violence in Mexico revolves around the drug trade, i.e. crooks killing other crooks, or corrupt police. Vigilantes killing crooks etc. If you not a crook you will be as safe as in any urban area in the US. I would take the job. There are a lot of very nice law abiding people down there. Dave
by Occupier
Wed Jun 12, 2013 8:01 pm
Forum: Investing - Theory, News & General
Topic: Vanguard muddles message by mixing up the 2 int'l bond funds
Replies: 12
Views: 1978

Re: Vanguard muddles message by mixing up the 2 int'l bond f

Boy, attitudes sure changed fast. The conventional wisdom till last month was, take your currency risk with equities not bonds. So most would just hold a set amount of international stocks and no foreign bonds. Now it's diversify your interest rate risk by having 20% of your bonds abroad, but don't take a currency risk, and pay for hedging instead. I don't think the world changed overnight. About 2 years ago I changed my allocation and exchanged TIPS for the unhedged World Inflation Protected ETF, WIP, I agree my timing lucked out, but I have never seen a rational explanation of why paying for hedging is a good idea when your buying a security that might yield 4% at most. Anyone got one? To me anyone buying foreign bonds should either accep...
by Occupier
Tue Jun 11, 2013 1:19 pm
Forum: Personal Investments
Topic: A good core bond fund
Replies: 12
Views: 2654

Re: A good core bond fund

Generally I agree with Nisiperius, but the way the bond market is today, I don't think looking at past performance is a good idea. 1) Since about the 80's the direction of rates is downward. 2) With rates reaching points where they can't go lower, expecting historic returns to repeat themselves is mathematically impossible. 3) Even Pimco's Gross says that rates have bottomed. 4) So I don't know what motivates the poster to want to bail on total bond, but if it was concerns that the market might go south due to interest rates increasing - which causes every bond fund to lose value by the amount of it's duration, then you ought to be telling us you put the money into a short term bond fund or limited term tax exempt, rather than another inter...
by Occupier
Mon Jun 10, 2013 5:54 pm
Forum: Personal Investments
Topic: portfolio review request
Replies: 2
Views: 434

Re: portfolio review request

I don't have a problem with the allocation. But I don't think I can say a thing about drawdown. I don't know what kinda money we are talking about, and might not comment anyway. I do think if you want to be more aggressive in withdrawing funds, you ought to have something which would produce more yield for 10% of your net worth than cash. Short term investment grade or a combination of that and total stock market with that 10%, or stick to the 3%. Dave
by Occupier
Mon Jun 10, 2013 5:42 pm
Forum: Investing - Theory, News & General
Topic: can you profit from relative bond valuations?
Replies: 2
Views: 473

Re: can you profit from relative bond valuations?

Shucks, from the title I thought it was just a question of picking the right rich uncle.
by Occupier
Fri Jun 07, 2013 7:59 pm
Forum: Personal Investments
Topic: Which Emerging Market Fund?
Replies: 8
Views: 1721

Re: Which Emerging Market Fund?

Well duh. Which fund is less expensive. You lose a lot of appreciation to costs. Especially if your talking about a lifetime. Further you did not tell us how much your adviser would charge to get you the DFA fund. Dave
by Occupier
Sun Jun 02, 2013 7:25 pm
Forum: Personal Finance (Not Investing)
Topic: Asset Protection (401k, Roth, 403b, 457)
Replies: 11
Views: 3144

Re: Asset Protection (401k, Roth, 403b, 457)

I think having adequate liability insurance is all the asset protection most people need.

You are correct. In California ERISA plans do offer more protection against seizure from a creditor than IRA's. I suppose if you or your parents are really concerned about this they could establish an 401 for their property management Co and theoretically roll everything into it. It has to be ERISA Qualified to get you the protection your mentioning. A Vanguard rep could tell you more about this because I know there are some limitations. I don't think they need annuities if they are able to make ends meet without them. It sounds like their financial adviser wants a commission for setting up an annuity. Dave
by Occupier
Sun Jun 02, 2013 2:14 pm
Forum: Investing - Theory, News & General
Topic: Total International Bond Fund
Replies: 4
Views: 1073

Re: Total International Bond Fund

I will tell you I hate to think I am betting against Vanguard, because that usually puts you one the loosing side, but I can't understand their position on hedging. 1) If your going to buy global bonds, which only yield slightly more than US, e.g. not much, why add the expense of hedging away currency exposure? 2) I will bet dollars to doughnuts that the cost of insurance against a dollar decline, e.g. hedging, ain't in the funds disclosed fee. Anyone want to try to straighten me out? Dave
by Occupier
Sat Jun 01, 2013 3:21 pm
Forum: Personal Investments
Topic: Investing in Stocks Funds When Market Is High
Replies: 10
Views: 2003

Re: Investing in Stocks Funds When Market Is High

I remember how things were in late 1999. I don't think things are nearly as "high" now as then. So you might not be buying into a market as likely to go down now as then. Also international stocks are quite low, so you can get them without the same concern about buying into a "high." Lastly suppose you sit out the market. How are you going to know when it's low enough to get in? I just don't subscribe to your concern about timing the market and I have not been all out or all in in a generation. If your really nervous then increase the bond portion to something that gives you a better comfort level. 40/60 say. That way your less likely to panic and sell out at a low and miss a recovery. Dave
by Occupier
Sat Jun 01, 2013 3:12 pm
Forum: Personal Investments
Topic: Portfolio Review
Replies: 10
Views: 1539

Re: Portfolio Review

The Wellington fund is not all that tax efficient i.e taxable bonds and dividend paying large Value stocks are less efficient than having a total stock market fund and tax free bonds or follow the advice in the next sentence. Just because you might retire in 2045 doesn't mean you have to own that years target. If you shortened one of the target funds to like 2025 you would have more bonds in tax free which is where they should be. And that would leave you free to have a efficient total market fund in taxable. In the 401, dump the high cost small cap growth fund. 1) the extra 3/4th of a percent over 30 years will add up to a lot of lost appreciation. 2) You can easily substitute the small blend indexed funds that are less expensive and have ...
by Occupier
Sat Jun 01, 2013 10:06 am
Forum: Investing - Theory, News & General
Topic: What's the right allocation to GNMA bonds?
Replies: 7
Views: 975

Re: What's the right allocation to GNMA bonds?

0% is the right allocation, except some in a fund like total bond are OK. I have come to the view Larry is right about these bonds. Basically when interest rates go down people refinance and just when you want a long duration bond, they pay off early. When interest rates go up no one wants to refinance, and durations get long just when you don't want them to and your stuck with a low rate bond when the market is higher. The only time you win with GNMA's is if rates don't change a bit and the slightly higher rate they have to compensate for the pre-payment risk is there. With rates at historic lows and most likely to rise at some point in the future GNMAs are not a wise risk to take. Dave
by Occupier
Fri May 31, 2013 10:16 pm
Forum: Investing - Theory, News & General
Topic: Utilities are down 10% in may!
Replies: 13
Views: 2077

Re: Utilities are down 10% in may!

I don't think the people who hold utilities care to much about the short term movements of their price, only that their dividends don't get cut. As a retired person I will tell you those dividends are sure nice when you go to the store to buy food for dinner. Dave
by Occupier
Fri May 31, 2013 10:11 pm
Forum: Personal Investments
Topic: Why no Intermediate-Term (I-T) Corporate Bond Fund?
Replies: 10
Views: 2244

Re: Why no Intermediate-Term (I-T) Corporate Bond Fund?

The Vanguard fund Intermediate Term Investment Grade fund used to be 100% Corporates. I will never forget the howls of protest at the old Morningstar list when it changed it's prospectus to include holding some government bonds. But it is still primarily an actively managed corporate fund. It's performance over the years is excellent. Dave
by Occupier
Fri May 31, 2013 10:00 pm
Forum: Personal Investments
Topic: Time to dump bond funds?
Replies: 25
Views: 3766

Re: Time to dump bond funds?

I don't agree with a lot that has been posted here. Interest rates were at historic lows a month ago with the most likely direction up at some unknown time and rate of increase. I mean it should be obvious that when they are close to zero they cant go much lower. If I were you I would exchange the long term bond fund for limited term tax exempt at Vanguard. There are still good reasons to hold bonds but not ones with high durations. Dave
by Occupier
Fri May 31, 2013 9:39 pm
Forum: Investing - Theory, News & General
Topic: bond allocation in Vanguard Target Retirement Funds
Replies: 10
Views: 1184

Re: bond allocation in Vanguard Target Retirement Funds

One possible rationalization for the lower bond ratio is that when you investing for a long time like 30 years you can take more equity risk. I agree that the target funds have higher than standard Boglehead bond ratios. You can just do like I do, lie about your age, and then invest your age in bonds. Dave
by Occupier
Thu May 30, 2013 8:30 pm
Forum: Personal Finance (Not Investing)
Topic: Military physician moonlighting...LLC?
Replies: 15
Views: 4307

Re: Military physician moonlighting...LLC?

Before you decide on incorporating just for the retirement benefits go to http://www.irs.gov and run IRA SIMPLE through the search engine. It is an IRA but is designed for people who don't have 401's. It has a lot larger contribution limit than an ordinary IRA. I don't know if military types can use it, but you don't have a 401 which might be important. Dave
by Occupier
Thu May 30, 2013 12:27 pm
Forum: Investing - Theory, News & General
Topic: trading costs matter
Replies: 13
Views: 1523

Re: trading costs matterave

A lot of people don't realize how much trading costs have gone down. I remember when you had to call your broker, listen to him talk about his score for the last golf game, then you told him how you did last time you went fishing, and you paid a couple of hundred a trade. Now you just pay pocket change and the computer doesn't care about golf scores or number of fish caught. I still think that learning low cost strategy pays off. Dave
by Occupier
Tue May 28, 2013 7:58 pm
Forum: Personal Investments
Topic: Bonds - Just starting out HELP! :)
Replies: 2
Views: 661

Re: Bonds - Just starting out HELP! :)

Generally you want some bonds to reduce volatility. So my vote is with the 90/10 of the various options. Keep you average duration around 5 or less and you wont be taking an unacceptable interest rate risk. The real reason why I decided to respond is that if your a high income person with a long term investment horizon you want to have more small value or at least small in the US and Internationally. Take a look at the early Larry Swedroe or William Bernstein books in your library. Dave
by Occupier
Tue May 28, 2013 7:46 pm
Forum: Investing - Theory, News & General
Topic: Hedgefund investing for the masses
Replies: 6
Views: 1037

Re: Hedgefund investing for the masses

No it sounds like fewer people are stupid enough to throw their money at these high cost - mostly low return, investment vehicles. Dave
by Occupier
Tue May 28, 2013 7:44 pm
Forum: Personal Consumer Issues
Topic: Selling Art
Replies: 8
Views: 1104

Re: Selling Art

I have sold art for estates. Generally I start by going to www.Sothebys.com and www.christies.com and sending in an electronic picture, measurements etc. to the right department. Their response is usually on the high side. That is because they want you to list with them. Then if you do, they talk you down to a realistic level. If they say the work has no auction value, then you contact the galleries listed on the Wikipedia page. They take more of your money as a commission, but they wont list it unless they think they can sell it. Dave
by Occupier
Thu May 02, 2013 2:30 pm
Forum: Personal Investments
Topic: REITs... buy more?
Replies: 39
Views: 5998

Re: REITs... buy more?

Yes 20% is too high. First why do you hold REITS which are just less then 2% of the market by market cap? The answer per Fama/French is that they don't correlate with other asset classes. That means they tend to go up when other classes don't do well, and go down when other classes do well. Following up on the last thought if you really overemphasize REITS they become like the tail wagging the dog. I.E. you don't correlate with other portfolios, but go up when others go down, and down when others go up. Now look at the valuations for REITS compared to where they were in the past. Right now REITS sell for about 2.5 times the book value of the real estate they own and they sell for about 60 times earnings. In 1999 REITS sold for just less the...
by Occupier
Wed May 01, 2013 10:54 am
Forum: Personal Investments
Topic: Finally ready to solicit some opinions [Physician]
Replies: 5
Views: 3603

Re: Finally ready to solicit some opinions [Physician]

Since you did not mention "her inactive 403" are you intending to roll that into an IRA? That is what I would have done yesterday. The higher costs there are going to add up to a lot of lost appreciation over 30 or so years. The other thing I notice is your proposed new allocation seems to be to create mini portfolios in each account. In fact it's all your money so you only need to have it all add up to the allocation you want. Don't put your wife all in bonds and you all in stocks, but you can pick a low cost fund available to her and emphasize it and in your accounts have more of other asset classes. For example, she has two Vanguard low cost funds in the 403 and a couple of not too expensive bond options. Well then you make up ...
by Occupier
Tue Apr 30, 2013 7:34 pm
Forum: Personal Investments
Topic: Seeking help with portfolio
Replies: 3
Views: 707

Re: Seeking help with portfolio

Why waste your time with someone who does not want to listen? He has a hodgepodge of stuff that he read some article about and decided to buy. I.E. no coherent plan. He has next to no bonds and 32% of his money is in cash not even beating inflation and waiting for him to get excited about something and buy at a high. If he does not want to be bothered he ought to have a 3 fund portfolio and save the percentage a year that he is wasting on management. He could be 40% Total US Stock Market, 30% Total International and 30% Total Bond and make up for the fact he has fallen behind where he should be. That would cost about .15% a year. One tenth of what he is paying now and perform better. Ask him if he goes to a restaurant, would he order a meal...
by Occupier
Sun Apr 28, 2013 8:38 pm
Forum: Personal Investments
Topic: Am I too conservative?
Replies: 17
Views: 2384

Re: Am I too conservative?

What I see and don't like is your tax placement. You have each account as a similar portfolio. In fact it's all you money and should be one portfolio with funds placed based on tax efficiency. In other words the three accounts don't need to look the same. In order of tax efficiency worst to best; taxable bonds, REIT, Small Value, Large Value, Large Blend, International/Emerging due to the foreign tax credit. So your taxable should be international/Emerging as in VXUS and something like VTI Vanguard Total US Market. The tax free is your bonds, REIT, and Small Value. Let the costs for each fund dictate which of the tax free accounts you hold them in. I think 90/10 is aggressive for you age. 80/20 normal 70/30 conservative. Dave
by Occupier
Sun Apr 28, 2013 8:27 pm
Forum: Personal Investments
Topic: Bond allocation for a 30 year old
Replies: 5
Views: 1481

Re: Bond allocation for a 30 year old

I take it your thinking of the cash value pension is a sort of bond. I tend to agree. As a result you can have a lower bond percent in other accounts. I don't know the figure because I don't know how big the cash value pension is. There is nothing wrong with the total bond index available to you. I think the Fidelity guy is just programed to say 25% without thinking. Dave
by Occupier
Sun Apr 28, 2013 8:19 pm
Forum: Personal Investments
Topic: Portfolio Q&A -- Probably Some Low-Hanging Fruit!
Replies: 66
Views: 4618

Re: Portfolio Q&A -- Probably Some Low-Hanging Fruit!

You can roll the old IRA and 401 into a new IRA. Vanguard or other low cost fund family is fine.
Now the expense in 10 years is fine if you allow for it in the taxable account. I would have a slightly higher bond allocation and call that my reserve for that expense.
Most rebalance once or twice a year some quarterly. I do it October and April. I don't think you need a money market account other than your emergency fund. I would not bother with REIT till you have room for it in a tax free account. Note Vanguard Small Value is 15% REIT so that is one way to kill two birds with one stone. Dave
by Occupier
Sat Apr 27, 2013 9:15 pm
Forum: Personal Investments
Topic: Portfolio Review Request
Replies: 10
Views: 1610

Re: Portfolio Review Request

In the taxable the expense ratio's are horrendous. That extra 1% a year adds up to a lot of lost appreciation over 20 years. Also international emerging markets are very tax efficient, so some VXUS (Vanguard international emerging total market) or the Fidelity equivalent is in order for this account. The Fidelity IRA's are high cost, why not pick a lower cost equivalent fund as suggested by others. I note the target retirement funds in the 401 are low cost (e.g. PYR INDX). If you want to have your bonds in the tax free account, pick a target that has a high enough bond ratio to get you where you want to be. You don't have to pick the actual date your going to retire. If not than look at the ETF, TFI, and have some tax free bonds in your tax...
by Occupier
Tue Apr 23, 2013 9:51 pm
Forum: Personal Finance (Not Investing)
Topic: [stopping] Telemarketers
Replies: 29
Views: 2630

Re: Telemarketers

If you want to complain to the people who enforce the do not call law, go to www.FTC.gov and in their consumer protection section you can fill out a complaint online. They do periodically chase the bad guys out of business. Dave