Search found 19184 matches

by nedsaid
Mon Mar 25, 2024 8:32 pm
Forum: Personal Investments
Topic: Fidelity Wealth Mgmt Advisor vs. Fidelity Target Fund
Replies: 17
Views: 1434

Re: Fidelity Wealth Mgmt Advisor vs. Fidelity Target Fund

I'm a single 58 year old, clueless about investing, & work way too much overtime to be able to educate myself. I have: $104k where I've 8% invested in FID FRDM BLND 2030 Target Fund with 0.66% expense ratio (32.1% domestic stock, 28.2% foreign stock, 39.7% Bonds) and 10% invested in Roth (just started the Roth today as I previously had the entire 18% in Target Fund). $445k in Fidelity Wealth Mgmt w/1.22% managed acct fee since May 2023 (40.4% domestic stock, 19.8% foreign stock, 36.3% bonds, 2% short term, 1.5% other). From May 2023 until today, the managed acct has increased $56k, net fees. I'm trying to decide if I should continue with a managed acct or just put everything back into the Target Fund to avoid the 1.22% managed acct fee...
by nedsaid
Mon Mar 25, 2024 8:25 pm
Forum: Personal Investments
Topic: Those complimentary dinners for retirees by investment advisors
Replies: 144
Views: 10618

Re: Those complimentary dinners for retirees by investment advisors

I went to one a few months back. The presentation is definitely a sales pitch. They were well skilled at instilling fear and confusion to make people think they need an advisor. I find analyzing communication styles and sales techniques interesting. There were really good appetizers on the table when we arrived. Alcohol was provided if you wanted it. I had a Diet Coke and my DW drank water. The presentation then began and lasted about 45 minutes. The advisors then left and went home to their families. Dinner was served and was nice. It was getting late, so we asked for our desserts in to go boxes. We also took home what we didn't eat. They had us fill out a card to indicate if we wanted any follow up contact. We indicated we were not inter...
by nedsaid
Mon Mar 25, 2024 8:19 pm
Forum: Personal Investments
Topic: Do Russian stock holders in the west have any chance of recovery?
Replies: 11
Views: 1796

Re: Do Russian stock holders in the west have any chance of recovery?

This shows the risk of investing in Emerging Markets, stuff like this has diminished my enthusiasm for them. There's a difference between investing in a single issuer versus a diversified EM bond fund. Stocks can go to zero too - basically the same issue. I have two Emerging Market mutual funds, one active and the larger one is passive. I am still invested but with less enthusiasm. I would not abandon a strategy based upon one investment going south. That is why diversification is so important. It does make one wonder about holding all of one's bonds in any one country's issues (including the US). I am an advocate for a Global portfolio. I figure that roughly 20% of my retirement portfolio is in International stocks and bonds. I own the Fi...
by nedsaid
Mon Mar 25, 2024 8:14 pm
Forum: Personal Investments
Topic: Portfolio Review in Retirement
Replies: 30
Views: 2729

Re: Portfolio Review in Retirement

As I read your posts, I see two things that have not been addressed so far. First, Oregon has a very low limit before the Estate Tax kicks in at $1,000,000 of assets. Not giving advice here on what to do but just saying to consider this with your estate planning. I am setting up an appointment with a FFS advisor and my accountant. Will add this to the list. Thanks. Second, a big factor in how aggressive your asset allocation should be in retirement is how much of your expenses in retirement is paid for by guaranteed income such as Social Security, pensions, and annuities. ... I also noticed that you have a $100,000 capital loss from the sale of of investment Real Estate... you may invest the $400,000 fairly aggressively as you will have ca...
by nedsaid
Sun Mar 24, 2024 2:49 pm
Forum: Personal Investments
Topic: Do Russian stock holders in the west have any chance of recovery?
Replies: 11
Views: 1796

Re: Do Russian stock holders in the west have any chance of recovery?

Call_Me_Op wrote: Sun Mar 24, 2024 2:44 pm
nedsaid wrote: Sun Mar 24, 2024 1:48 pm This shows the risk of investing in Emerging Markets, stuff like this has diminished my enthusiasm for them.
There's a difference between investing in a single issuer versus a diversified EM bond fund. Stocks can go to zero too - basically the same issue.
I have two Emerging Market mutual funds, one active and the larger one is passive. I am still invested but with less enthusiasm.
by nedsaid
Sun Mar 24, 2024 2:03 pm
Forum: Investing - Theory, News & General
Topic: Is there recent data on DFA-type funds vs low-cost index funds?
Replies: 8
Views: 972

Re: Is there recent data on DFA-type funds vs low-cost index funds?

I want to point out that DFA now has a full suite of 38 ETFs with over $100 Billion under management. These include Equity, Fixed Income, and Real Estate. Investors no longer need an Advisor to access DFA. In comparison, Avantis manages $30 billion and this includes Avantis mutual funds and ETFs. Avantis has been a successful DFA mini-me, most of their staff are former DFA employees. So no reason to employ an Advisor to execute a tilting strategy. By the way, here is a good article by Jim Dahle of White Coat Investor fame that discusses Avantis vs. Vanguard. He discusses DFA in the same article. https://www.whitecoatinvestor.com/avantis-vs-vanguard/#:~:text=The%20Advantage%20of%20ETFs,Vanguard%2C%20Schwab%2C%20and%20Fidelity. Here is a DFA ...
by nedsaid
Sun Mar 24, 2024 1:48 pm
Forum: Personal Investments
Topic: Do Russian stock holders in the west have any chance of recovery?
Replies: 11
Views: 1796

Re: Do Russian stock holders in the west have any chance of recovery?

This shows the risk of investing in Emerging Markets, stuff like this has diminished my enthusiasm for them.
by nedsaid
Sun Mar 24, 2024 1:43 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

Good enough for what? As normal, the great Nisiprius has an answer for that. He compared DFA US Small Cap Value with Vanguard Small Cap Value Index fund. Here is the thread: https://www.bogleheads.org/forum/viewtopic.php?p=7783806#p7783806 His analysis is the 6th post down from the top. From my own experience, the style index products did better than DFA when factors, particularly Value, wasn't doing so well relative to the market and to Large Growth. Now that Value has seen a resurgence in 2021 and 2022, the DFA/Avantis type of funds are doing better than the style index funds. That is about what one would expect. So when you have a microscopic tilt, the fund you choose does not meaningfully change your outcome. So why do it at all? I did...
by nedsaid
Sun Mar 24, 2024 12:38 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

I have chosen relatively minor factor tilts and use the style index fund products. I might be right or I might be wrong but that is what I have done. If your commitment to factor investing is strong, probably the use of DFA/Avantis products are best. If you are more wishy-washy like me, the style indexes are likely good enough. Good enough for what? As normal, the great Nisiprius has an answer for that. He compared DFA US Small Cap Value with Vanguard Small Cap Value Index fund. Here is the thread: https://www.bogleheads.org/forum/viewtopic.php?p=7783806#p7783806 His analysis is the 6th post down from the top. From my own experience, the style index products did better than DFA when factors, particularly Value, wasn't doing so well relativ...
by nedsaid
Sun Mar 24, 2024 12:13 pm
Forum: Personal Investments
Topic: Portfolio Review in Retirement
Replies: 30
Views: 2729

Re: Portfolio Review in Retirement

Peter Foley wrote: Sun Mar 24, 2024 10:13 am You are generally on target and that is evidenced by the responses you have received so far.

An item missing in your profile is spending, specifically charitable contributions. If you make regular contributions to charities you should set up an IRA to be able do easily do Qualified Charitable Distributions. (Some IRAs allow a checking account which makes charitable gifting easy.)

The first step up for IRMAA is not horrible, the second step gets a bit expensive. QCDs can help control taxable income.
The possible use of Qualified Charitable Distributions is an excellent suggestion.
by nedsaid
Sun Mar 24, 2024 12:07 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

I have chosen relatively minor factor tilts and use the style index fund products. I might be right or I might be wrong but that is what I have done. If your commitment to factor investing is strong, probably the use of DFA/Avantis products are best. If you are more wishy-washy like me, the style indexes are likely good enough. Good enough for what? As normal, the great Nisiprius has an answer for that. He compared DFA US Small Cap Value with Vanguard Small Cap Value Index fund. Here is the thread: https://www.bogleheads.org/forum/viewtopic.php?p=7783806#p7783806 His analysis is the 6th post down from the top. From my own experience, the style index products did better than DFA when factors, particularly Value, wasn't doing so well relativ...
by nedsaid
Sun Mar 24, 2024 11:57 am
Forum: Investing - Theory, News & General
Topic: The Evolutions of Indexes, new "Bogleheads on Investing" podcast with guest Rolf Agather
Replies: 13
Views: 1781

Re: The Evolutions of Indexes, new "Bogleheads on Investing" podcast with guest Rolf Agather

I listened to the podcast and it was excellent. For you index snobs out there, this is a must listen to podcast. Learning how indexing has progressed was very interesting to say the least. What I didn't know was that Russell and FTSE merged. Also a discussion about how active investing can cleverly hide as passive investing through a very creative definition of indexing. Stuff like that.

Again Rick, excellent work as always and I deeply appreciate your efforts.
by nedsaid
Sun Mar 24, 2024 11:18 am
Forum: Personal Investments
Topic: Fiduciary advisors vs not - how important do you think it is
Replies: 33
Views: 2275

Re: Fiduciary advisors vs not - how important do you think it is

I made a half-hearted attempt to answer this question once. Or rather, to answer a more specific question. The form I asked it in was "Are Vanguard advisors fiduciaries?" What I think I learned is that the firm may be a fiduciary but that doesn't mean the particular human being you are talking to is. And that the same human being may or may not be a fiduciary depending on what hat they are wearing (whether they are selling you a mutual fund or insurance). I gave up. I don't know how to tell if an advisor is a fiduciary and I don't know what it means in real life. These questions don't lend themselves to precision, it is better to see this in terms of degree. While it is difficult to get a precise example of a fiduciary Advisor, w...
by nedsaid
Sun Mar 24, 2024 10:28 am
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

. What I have said is to factor tilt your portfolio if you believe in the academic research and to use simpler 3-5 fund portfolios using the broad indexes if you don't. You can believe the academics and still believe it’s a crap strategy for 98.5% of investors. Plenty of academics including FF, acknowledge this. I do remember a Fama quote that portfolio tilts were a matter of taste. Nisiprius had a post on this, there was a video interview of Fama and the DFA website which appears to have been taken down. I forget the exact quote but it does reveal that Fama is not as dogmatic about this as one would believe. That being said, Fama and French still consult for DFA and the company was founded based upon their research. So someone out there b...
by nedsaid
Sun Mar 24, 2024 9:16 am
Forum: Investing - Theory, News & General
Topic: Is there recent data on DFA-type funds vs low-cost index funds?
Replies: 8
Views: 972

Re: Is there recent data on DFA-type funds vs low-cost index funds?

I have not come across any studies of this nature, but if you're just interested in relative performance, you can do your own comparisons at either Morningstar or Portfolio Visualizer. More broadly I'd point out that active/passive is not a binary property but rather a spectrum . The US total stock market (VTI/VTSAX) is fully passive, while stock picking funds are fully active. The S&P 500 is mostly passive, but it is comprised of companies chosen by a selection committee. DFA and Avantis funds don't follow an index, but they do use a systematic rules-based strategy, putting them somewhere the middle of the spectrum. I also don't think the question of relative performance between something like VTSAX vs DFSVX (DFA US Small Value) is me...
by nedsaid
Sun Mar 24, 2024 9:13 am
Forum: Personal Investments
Topic: Portfolio Review in Retirement
Replies: 30
Views: 2729

Re: Portfolio Review in Retirement

As I read your posts, I see two things that have not been addressed so far. First, Oregon has a very low limit before the Estate Tax kicks in at $1,000,000 of assets. Not giving advice here on what to do but just saying to consider this with your estate planning. Second, a big factor in how aggressive your asset allocation should be in retirement is how much of your expenses in retirement is paid for by guaranteed income such as Social Security, pensions, and annuities. The higher percentage of your expenses that are covered by guaranteed income, the more aggressively you can invest. Looks to me that you don't need a Single Premium Immediate Annuity, the reasons for considering one would be peace of mind and increasing the percentage of gua...
by nedsaid
Sun Mar 24, 2024 1:48 am
Forum: Personal Investments
Topic: New employer; should I direct rollover my 401k?
Replies: 11
Views: 826

Re: New employer; should I direct rollover my 401k?

There is nothing wrong with waiting and deferring the decision. Your old 401(k) is at a low cost provider as is the new provider, the issue is that you don't want those funds to be out of the market 2-4 weeks. Nothing is really lost by deferring the decision. If you change jobs over your career with different employers, what you don't want is having a lot of old workplace savings plans floating around. If all you have is your old 401(k) and your new one, you can just wait. If you have other old accounts floating around out there, probably better to consolidate.
by nedsaid
Sun Mar 24, 2024 1:42 am
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

In the ideal Nedsaid world, diversification perfectly exists in a portfolio where you have 3-4 asset classes with very similar performance but where correlation between them hovers around zero. Paul Merriman has expressed this in the construction of his portfolios. No, he hasn't. According to PortfolioVisualizer, the FundAdvice (Merriman) Ultimate Buy-and-hold Portfolio is VFINX Vanguard 500 Index Investor 6.00% VIVAX Vanguard Value Index Inv 6.00% NAESX Vanguard Small Cap Index Inv 6.00% VISVX Vanguard Small Cap Value Index Inv 6.00% VGSIX Vanguard Real Estate Index Investor 6.00% VTMGX Vanguard Developed Markets Index Admiral 12.00% VEIEX Vanguard Emerging Mkts Stock Idx Inv 6.00% EFV iShares MSCI EAFE Value ETF 12.00% VFITX Vanguard Int...
by nedsaid
Sun Mar 24, 2024 1:15 am
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

1) When you split the stock market by sector, there is at least logic in where returns are coming from and how they're going to behave in different environments. e.g. Utilities vs Energy. And that gives you tools to work with .. The relationship between factors and economic regimes is much less reliable – and good portfolio construction is about balancing market and macroeconomic risks (not betting on multiple horses). Funnily enough, a sector's return is often best explained by a factor analysis. What you're proposing would mean ignoring the underlying fundamentals of the sector, and instead trying to market-time based on the history of previous "economic regimes". That's the total opposite of Boglehead or factor investor method...
by nedsaid
Sun Mar 24, 2024 1:06 am
Forum: Personal Consumer Issues
Topic: What Movie Have You Recently Watched?
Replies: 11152
Views: 2086254

Re: What Movie Have You Recently Watched?

Ordinary Angels and Arthur The King.
by nedsaid
Sun Mar 24, 2024 1:03 am
Forum: Investing - Theory, News & General
Topic: The Evolutions of Indexes, new "Bogleheads on Investing" podcast with guest Rolf Agather
Replies: 13
Views: 1781

Re: The Evolutions of Indexes, new "Bogleheads on Investing" podcast with guest Rolf Agather

Thank you Rick for your excellent work on these podcasts, I have learned a lot from listening to them. This particular episode will be very interesting to Bogleheads as we have become a forum of what I jokingly refer to as "Index fund snobs" and "Index pickers". This is a way of saying that indexing is a more complex topic than many realize, such things as index construction, sophisticated trading techniques to minimize the effects of front running by professional traders, use of such things as options and futures. It is 11:00 pm, my time as I write this so I will listen to this later on. Again Rick, thank you for your excellent work.
by nedsaid
Sat Mar 23, 2024 11:54 pm
Forum: Personal Investments
Topic: Fiduciary advisors vs not - how important do you think it is
Replies: 33
Views: 2275

Re: Fiduciary advisors vs not - how important do you think it is

Allan Roth has said that he has been appalled at what he has seen Advisors do who are supposed to be fiduciaries. Seems to me that fiduciary status is most often a starting point and not an ending point when selecting an Advisor, further due diligence is needed beyond that. Those who work for a firm that has Registered Investment Advisor status are fiduciaries, those who work for Broker-Dealers are subject to a lesser suitability standard. There are also dual status advisors who have both RIA and Broker-Dealer affiliations. There are good folks who work for Broker-Dealers and who have only securities and perhaps insurance licenses but I would say that credentials like Certified Financial Planner are a big plus. Fiduciary status is pretty im...
by nedsaid
Sat Mar 23, 2024 11:42 am
Forum: US Chapters
Topic: Post your Financial Milestone Announcements Here
Replies: 3623
Views: 569259

Re: Two Comma Club

Today, with this small market increase, I joined the two comma club at the age of 38 :sharebeer It's so good to know that no matter what happens with my employment, I'll be okay. Money is freedom. The above two comma club lasted EXACTLY ONE DAY. 16 months later, I have rejoined it :sharebeer (let's see if I can hold it for longer this time) Yes, many of us hit our all time highs around 1/3/22, when you hit the two comma club for the first time. I’m glad that you stayed the course and have regained that high water mark. With over $1 million at (now) age 39, you’ll be just fine as you continue to save and invest wisely. Congratulations! On Thursday, March 21, 2024 my portfolio hit all time highs. This doesn't take into consideration the surg...
by nedsaid
Sat Mar 23, 2024 11:36 am
Forum: Investing - Theory, News & General
Topic: WisdomTree's Dividend Growth Funds
Replies: 13
Views: 1599

Re: WisdomTree's Dividend Growth Funds

OP, maybe you meant to say Wealthfront rather than Wisdom Tree? Malkiel has been associated with the former for awhile now. Mr. Malkiel is chief investment adviser for Wealthfront, a pioneering automated investment manager that last week adopted a new approach it calls Advanced Indexing. The strategy aims to exploit market inefficiencies and beat the passive approach, based on an index weighted by stocks’ market capitalization, which Mr. Malkiel has long championed. This falls within a broad investing category known as “smart beta,” beta being a measure of the volatility of a security or a portfolio in comparison to the market as a whole. Jeremy Seigel, the famed Wharton School Professor at University of Pennsylvania, is associated with Wi...
by nedsaid
Sat Mar 23, 2024 11:27 am
Forum: Personal Finance (Not Investing)
Topic: Dedicated Financial Computer Master Thread
Replies: 209
Views: 9793

Re: Dedicated Financial Computer Master Thread

TheTimeLord wrote: Fri Mar 22, 2024 12:13 pm This topic occasionally comes up but is fairly hard to search on the form. So how many people are using a dedicated financial computer as their only means of online access to their accounts? Any tips or tricks you think are worth sharing?
I have a sibling who does precisely this.
by nedsaid
Thu Mar 21, 2024 8:03 pm
Forum: Personal Investments
Topic: Equiy Indexed Annuity using retirement money
Replies: 28
Views: 1909

Re: Equiy Indexed Annuity using retirement money

Garbage advice They can change the caps and participation rates without your consent They don’t include dividends which are important What they do is invest 96-98% in bonds and the other 4% in options. Your return will thus be similar to regular fixed annuities regardless of their initial caps/participation rates bc they are limited by their own investments They agent will get a nice commission for selling it to you. Avoid it. All good points and all true. I recall participating in a similar thread some years back and I did a lot of research for my posts. I could not find data on how these things actually perform, I may as well have tried to get the codes to launch a nuclear strike. I even googled the name of the policy that was being disc...
by nedsaid
Sun Mar 17, 2024 1:50 pm
Forum: Personal Consumer Issues
Topic: Windows 10 Patch Tuesday problems
Replies: 30
Views: 5469

Re: Windows 10 Patch Tuesday problems

Why doesn't Microsoft break these updates into smaller pieces so that the updates can more easily install on older machines? It just seems that they issue these monster updates sometimes that are just too much for older machines to handle, though they theoretically have enough memory to run the operating system. It just seems that the operating system gets bigger and more bloated with each update and eventually the updates just won't work anymore. Bad habit that Microsoft has of understanding the actual system requirements for their operating systems. From what I can tell, Microsoft wants you to ditch your old computers, consign them to the landfill and buy bright new PCs that can handle Windows 11. Microsoft's sneaky KB5001716 Windows 10 ...
by nedsaid
Sun Mar 17, 2024 12:25 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

To me, Merriman’s portfolio is a prime example of “diworsification.” An investor who seeks the “free lunch” of diversification buys a bunch of highly correlated funds and ends up with a grab bag of funds that generally accomplish the same thing just in a less efficient, more complicated way. I think true diversification comes with different asset classes: stocks, bonds, real estate (not-REITs) commodities, private equity, or others. I don’t think you achieve the same goals at least to the same degree by dividing an asset class like stocks into correlated sub-asset classes based on size and value. McQ had great threads on Markowitzian diversification and I recommend them to other readers. They are that good. You raise the important question...
by nedsaid
Sun Mar 17, 2024 12:20 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

What I have tried and apparently failed to get across is a pretty simple idea. Investors, be prepared to deal with ambiguity or you will be endlessly frustrated. In other words, theory and practice are two different things but you still need theory. Lots of things in finance and even in life in general are fuzzy and slippery. I wish it wasn't true in the experience of life but alas, it is. Sorry, sports fans to be a bearer of bad news but I have chosen to be the one who delivers it. It isn't popular because we want everything to be clean, easy to explain, and easy to understand. Sadly, it just ain't so. Some things are just not so easy to understand. Not sure why you think you've failed. Many of us already know that we're viewing things, a...
by nedsaid
Sun Mar 17, 2024 12:02 pm
Forum: Personal Consumer Issues
Topic: how to disable "See results closer to you?" - Chrome
Replies: 25
Views: 2269

Re: how to disable "See results closer to you?" - Chrome

LOL!!! Resistance is futile. You will be assimilated.
by nedsaid
Sun Mar 17, 2024 12:01 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

What I have tried and apparently failed to get across is a pretty simple idea. Investors, be prepared to deal with ambiguity or you will be endlessly frustrated. In other words, theory and practice are two different things but you still need theory.

Lots of things in finance and even in life in general are fuzzy and slippery. I wish it wasn't true in the experience of life but alas, it is. Sorry, sports fans to be a bearer of bad news but I have chosen to be the one who delivers it. It isn't popular because we want everything to be clean, easy to explain, and easy to understand. Sadly, it just ain't so. Some things are just not so easy to understand.
by nedsaid
Sun Mar 17, 2024 11:33 am
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

In the ideal Nedsaid world, diversification perfectly exists in a portfolio where you have 3-4 asset classes with very similar performance but where correlation between them hovers around zero. Paul Merriman has expressed this in the construction of his portfolios. No, he hasn't. According to PortfolioVisualizer, the FundAdvice (Merriman) Ultimate Buy-and-hold Portfolio is VFINX Vanguard 500 Index Investor 6.00% VIVAX Vanguard Value Index Inv 6.00% NAESX Vanguard Small Cap Index Inv 6.00% VISVX Vanguard Small Cap Value Index Inv 6.00% VGSIX Vanguard Real Estate Index Investor 6.00% VTMGX Vanguard Developed Markets Index Admiral 12.00% VEIEX Vanguard Emerging Mkts Stock Idx Inv 6.00% EFV iShares MSCI EAFE Value ETF 12.00% VFITX Vanguard Int...
by nedsaid
Sun Mar 17, 2024 11:12 am
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

[Image of McQ standing, tapping baton against open palm] What we have here is a failure to communicate. I’ve reposted below a recent journal paper that I posted earlier in the thread. Let me note: 1. It’s from 2023, four years after the Harvey et al. paper that nisiprius cited; 2. It’s title directly addresses the Harvey et al. paper; 3. It appears in the #1 ranked peer-reviewed journal in Finance; 4. Using the largest and most comprehensive data set yet seen, global as well as US, it finds robust statistical evidence for a dozen or so factors. It’s over, folks: the academic research has moved well beyond the days of “There were problems in the Banz data,” or “Factor effects seem to be arbitraged away once discovered,” and other hoary ches...
by nedsaid
Sun Mar 17, 2024 10:49 am
Forum: Personal Investments
Topic: What should I do with a deferred annuity?
Replies: 15
Views: 1417

Re: What should I do with a deferred annuity?

Dear BHs - I am trying to decide what to do with a small personal retirement annuity account that I set up through Fidelity during a weak moment with one of their advisors - I maxed out my 401k and wanted another place to save, and didn’t want to put any more into my deferred comp. It is a tax deferred savings variable annuity vehicle that eventually (like when I’m 95) would have to be annuitized. If take withdrawals I pay tax on earnings but not on my after tax contributions (it is up about 20% since I set it up and made monthly contributions of $1000 for a few years). I had a hazy plan when I set it up that I would grow it to 250k or so and it would eventually be part of my self funded LTC account/ guaranteed income stream when I am olde...
by nedsaid
Sun Mar 17, 2024 10:45 am
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

I don't understand that chart. What is "the" correlation of a portfolio with 10 assets? Are they assumed to be equally weighed? Continuously rebalanced? Does 0% correlation mean that each of the 45 pairs of assets has zero correlation? Is "return-to-risk ratio" the Sharpe ratio? ... If not, what is he using instead? What is his preferred measure of "risk?"... If "probability of losing money in a given year" is his chosen figure of merit, so be it, but it seems odd to me... I would assume 0 correlation. Between what and what? But I would say it's primarily about demonstrating the principle of diversification. You've missed the point of my question. I'm not looking for "a pictorial illustration of...
by nedsaid
Sun Mar 17, 2024 10:24 am
Forum: Personal Consumer Issues
Topic: Windows 10 Patch Tuesday problems
Replies: 30
Views: 5469

Re: Windows 10 Patch Tuesday problems

KB5034763 Cumulative Update for Windows 10 Version 22H2 for x64 based systems just installed flawlessly on my Desktop machine. I guess Microsoft just bypassed the KB5034441 update that failed to install on a lot of machines. Later on, I will try the new update on my Laptop. Yesterday, KB5034763 successfully installed on my Surface laptop with Windows 10 Home Edition, but KB5034441, which was part of the monthly update package, failed the same as last month. So Microsoft still has some work to do. Why doesn't Microsoft break these updates into smaller pieces so that the updates can more easily install on older machines? It just seems that they issue these monster updates sometimes that are just too much for older machines to handle, though ...
by nedsaid
Sun Mar 17, 2024 10:18 am
Forum: Personal Investments
Topic: What should I do with a deferred annuity?
Replies: 15
Views: 1417

Re: What should I do with a deferred annuity?

Dear BHs - I am trying to decide what to do with a small personal retirement annuity account that I set up through Fidelity during a weak moment with one of their advisors - I maxed out my 401k and wanted another place to save, and didn’t want to put any more into my deferred comp. It is a tax deferred savings variable annuity vehicle that eventually (like when I’m 95) would have to be annuitized. If take withdrawals I pay tax on earnings but not on my after tax contributions (it is up about 20% since I set it up and made monthly contributions of $1000 for a few years). I had a hazy plan when I set it up that I would grow it to 250k or so and it would eventually be part of my self funded LTC account/ guaranteed income stream when I am olde...
by nedsaid
Sat Mar 16, 2024 4:47 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

Tech/growth has indeed gotten "too" popular, reprising the dot-com era. It's easy to pan rank amateurs who are chasing the latest-latest, only to be rudely disabused. But I wonder... suppose that someone held tech/growth through many of these boom/bust cycles, with BH-style stolid patience, but un-BH emphasis on what might be termed speculative. Would such an investor be, as you phrase it so piquantly, in a better financial situation today? A major issue is that tech tends to align with large-cap. The S&P 500 is dominated by tech. Investors who overweight small-cap or mid-cap are implicitly underweighting tech. Thus the small-cap premium - a much-storied "factor" - is either diminished or outright reversed. A more c...
by nedsaid
Sat Mar 16, 2024 3:36 pm
Forum: Investing - Theory, News & General
Topic: Great news! No more [fixed real estate] agent commission
Replies: 238
Views: 22630

Re: Great news! No more [fixed real estate] agent commission

Real Estate Agents can generate value. I will just say that my family sold a property that was hard to sell for various reasons and a determined agent was able to get it done. Their efforts were worth every penny of commission paid. I know this isn't always true but I wonder about the unintended consequences of the change. We will see.
by nedsaid
Sat Mar 16, 2024 3:26 pm
Forum: Personal Investments
Topic: What should I do with a deferred annuity?
Replies: 15
Views: 1417

Re: What should I do with a deferred annuity?

Thank you everyone for your thoughtful and informative replies! I need to do some more research on eventual drawdown / conversion options but for now I am going to hang on to the annuity - my RMDs will be at 75, and I will have some “gaps” to fill at lower tax brackets in that time. However for now I am directing any future “excess” savings to my taxable account (vs the annuity) so that I can balance my taxable vs tax deferred vs Roth balances. Investing in taxable accounts with your excess savings is a good move. That way you can sell stock investments and receive favorable capital gains treatment. Withdrawals from the annuity, to the extent that you have gain, are distributed as ordinary income. The portion of withdrawals that represent ...
by nedsaid
Sat Mar 16, 2024 3:24 pm
Forum: Personal Investments
Topic: What should I do with a deferred annuity?
Replies: 15
Views: 1417

Re: What should I do with a deferred annuity?

Dear BHs - I am trying to decide what to do with a small personal retirement annuity account that I set up through Fidelity during a weak moment with one of their advisors - I maxed out my 401k and wanted another place to save, and didn’t want to put any more into my deferred comp. It is a tax deferred savings variable annuity vehicle that eventually (like when I’m 95) would have to be annuitized. If take withdrawals I pay tax on earnings but not on my after tax contributions (it is up about 20% since I set it up and made monthly contributions of $1000 for a few years). I had a hazy plan when I set it up that I would grow it to 250k or so and it would eventually be part of my self funded LTC account/ guaranteed income stream when I am olde...
by nedsaid
Sat Mar 16, 2024 3:11 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

My gosh, even the most inexperienced and naive investors realize that High Tech stocks behave differently than Utility stocks. This is factors in action, people can see this and they know that not all stocks behave the same. This is a big reason that I use the analogy of sector investing to help explain factors. Would we aver that over very long periods of time - say, 50 years - tech stocks outperform utilities? Then an investor with an iron stomach, no concern for sequence of returns risk, and an indefinitely long horizon, would hold a large QQQ position, or maybe VGT. Is that consist with BH principles? From what I've observed on the Forum, QQQ/VGT are viewed askance, as cautionary reductions-to-the-absurd of recency bias, performance ch...
by nedsaid
Sat Mar 16, 2024 1:07 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Announces CEO Retirement and Appointment of President
Replies: 372
Views: 36471

Re: Vanguard Announces CEO Retirement and Appointment of President

Flagship status meant something when expense ratios were much higher. Today a $1 million account might mean a lot to you but to Vanguard it amounts to around $400 a year. A lot of people spend more than that at Starbucks. It hardly makes you a special customer. So I guess Vanguard should only keep the 8 billionaires who have accounts there and close the other 50 million accounts? That would be stupid. Why would they do that? Would Starbucks turn away all customers that didn't spend $400 a year? You're saying these accounts mean little to Vanguard. No, I did not say that. [Unnecessary comment removed. Moderator Pops1860] I said they were nothing special. They are like lots of the other 50 million accounts. There are a lot of benefits to the...
by nedsaid
Sat Mar 16, 2024 12:39 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

...My read is that Logan is using a hypothetical "A" factor as a joke to highlight the "factor zoo" phenomenon whereby new "factors" can be conjured by anyone looking at a dataset retrospectively and identifying anomalies that are most likely due to chance. That's the definition of "data-mining."... And to me, the "'factor zoo' phenomenon" is itself evidence against the validity of factor research. In Campbell R. Harvey and Yan Liu (2019), A Census of the Factor Zoo , we read--emphasis supplied: We document over 400 factors published in top journals . Surely, many of them are false. We explore the incentives that lead to factor mining and explore reasons why many of the factors are simply l...
by nedsaid
Sat Mar 16, 2024 12:19 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

Can anyone please explain how the discussion from the past couple pages necessarily varies considerably from the following discussion of bond duration positioning? My contention was that long-term bonds appeared too expensive for my personal considerations. The reply was basically that under one definition for risk, long-term bonds provided higher expected future returns. I contended the given theory was not in line my own considerations. Essentially I was not operating under the presumptions included in the offered definition for risk, so I disagreed with the expected return concept of duration that followed. Anyway, I'm failing to understand how the recent discussion considerably varies. Different market participants likely have non-matc...
by nedsaid
Sat Mar 16, 2024 12:03 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

Yes, because there’s more uncertainty of outcomes and there’s always a higher discount rate to command higher expected returns That is a fascinating use of logic. Something with higher expected returns is riskier and thus demands a lower price. Therefore we can say the converse is true, that anything cheaper must have higher expected returns. We can now say that QQQ is less risky than AVUV, albeit with lower expected returns from choosing QQQ. It makes me wonder why the highest possible PE investing has not caught on as the lowest risk way to get stock-like returns. We should be loading up on the very highest P/E stocks if we are risk averse. I suspect this line of thinking is not sound. Here is the deal sports fans. First, it is a good id...
by nedsaid
Fri Mar 15, 2024 8:34 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46474

Re: More Evidence Against Factor Investing

It is pretty much acknowledged the size factor never existed as statistically significant after the data was corrected for delisting biases. So here's one more (anecdotal) data point that what is "pretty much acknowledged" by factor cognoscenti is not what is reaching the general public: I have enjoyed the Target-Date Fund as a one-stop shop for our retirement accounts. However the work of Paul Merriman is very convincing. Overweighting small-cap stocks and possibly small-cap value stocks seems to be a good bet for excess returns. Our time period is about 30 years to retirement, so we have a very long holding period. Where is the current research on the general market cap index fund vs including some overweighting? Thank you! I s...
by nedsaid
Wed Mar 13, 2024 7:23 am
Forum: Personal Investments
Topic: Financial Advisor says my portfolio is akin to a retiree at age 34
Replies: 80
Views: 8329

Re: Financial Advisor says my portfolio is akin to a retiree at age 34

Thanks all for the encouragement and advice! To answer some of the oft repeated questions about the FA and the management firm. The firm is Janney Capital Management. So, I met a bunch of neighbors at a neighborhood gathering who are all at least >50 years old and all of them 100% wealthier than I am. The demographic consists of people who are well versed in financial matters and others who have no idea what a stock/bond is and more or less born into wealth. A significant percent of both these groups had their wealth in asset management firms. Surprisingly, the ones who were fluent in finance admitted that their FA tends to do less well than the S&P500 along with higher fees. Yet, they were happily part of the Asset Management as it wa...
by nedsaid
Tue Mar 12, 2024 8:51 pm
Forum: Personal Finance (Not Investing)
Topic: Why my mom will continue to need a financial advisor
Replies: 23
Views: 2140

Re: Why my mom will continue to need a financial advisor

BogleTaxPro wrote: Tue Mar 12, 2024 8:47 pm Vita has an income limit but AARP tax aide does not. Your mom sounds like she'll fit our scope. Our sites are back to doing in person one visit tax prep. It does vary by state and district though. Sites that only do appointments may already be booked but we have sites that do walk-in. Visit AARP tax aide locator and type in your zip.
I have sent a number of people to AARP over the years, folks who couldn't afford to pay tax preparation fees. I have a high opinion of their volunteer tax service. Once had a co-worker who volunteered for this, I was impressed with the training program that AARP had based upon what he told me. My co-worker had a positive experience doing this and felt good about helping others.
by nedsaid
Tue Mar 12, 2024 8:47 pm
Forum: Personal Finance (Not Investing)
Topic: Why my mom will continue to need a financial advisor
Replies: 23
Views: 2140

Re: Why my mom will continue to need a financial advisor

We can, and have, had them done for $0 at the senior center, just have to remember to make an appt in Jan. I believe it’s done through AARP. The down side is since Covid, you don’t sit down with the preparer. You fill out some questionnaire’s, drop them off on you appt day, then they call you later that once completed. You pick em up, look thru them, sign if you have no issues, drop them off and get a copy. It works but feels kind of strange as it’s completely impersonal. I did taxes part-time and full time for 28 years. Over the years, I saw a number of returns done by the AARP volunteers and never saw a problem with them. They seem to do a good job with quality control. They won't do complex returns as the intent is to help lower income ...