Search found 564 matches

by CantPassAgain
Fri Aug 10, 2018 6:08 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Valuations Too High?
Replies: 229
Views: 18215

Re: Larry Swedroe: Valuations Too High?

This all boils down to "tactical asset allocation" ie "market timing" despite the gobledygook double-talk from various posters. If that floats some peoples boat that's fine, but for God's sake quit denying it.

I've heard tell of so-called tactical allocation funds from days gone by. Funny they aren't around anymore, guess they didn't use the right model.
by CantPassAgain
Fri Aug 10, 2018 2:09 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Valuations Too High?
Replies: 229
Views: 18215

Re: Larry Swedroe: Valuations Too High?

Interesting and well thought out article. Several observations/questions: 1) I breath a sigh of relief to see a tempered voice recognizing that, of course, valuations matter. For anyone taking the time to actually study the data, instead of just responding to sound-bytes, its ludicrous to suggest otherwise. But as you point out, they only matter over longer periods of time. Always entertaining to watch the witch hunt ensue against anyone who declares markets are historically high - only to be followed by markets randomly going up the next day or year anyway….. The key understanding is that you have to look long-term. No idea where markets will be in a year, or 5. But if one buys/owns an SP500 index fund in 2018, there exists a high probabi...
by CantPassAgain
Thu Aug 09, 2018 9:38 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Valuations Too High?
Replies: 229
Views: 18215

Re: Larry Swedroe: Valuations Too High?

Of course? Why do you believe buy-and-hold will deliver? Because when you are investing in public common stocks you are investing in enterprises that are attempting to be productive and profitable for their shareholders by offering products and services that are meant to improve lives and increase standards of living? Ie generating wealth in a capitalistic system. So? "Everything changes." Not sure if you are being disingenuous or what. The whole point is that you can't predict what returns are going to be because economies change. The profit motive still remains and we still expect some sort of a return premium to less risky investments. Yeah, we are banking on our capitalistic system/free enterprise to stick around. Does that m...
by CantPassAgain
Thu Aug 09, 2018 9:13 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Valuations Too High?
Replies: 229
Views: 18215

Re: Larry Swedroe: Valuations Too High?

james22 wrote: Thu Aug 09, 2018 3:16 am Of course?

Why do you believe buy-and-hold will deliver?
Because when you are investing in public common stocks you are investing in enterprises that are attempting to be productive and profitable for their shareholders by offering products and services that are meant to improve lives and increase standards of living? Ie generating wealth in a capitalistic system.

What did you think you were investing in? Baseball cards?
by CantPassAgain
Wed Aug 08, 2018 11:06 pm
Forum: Investing - Theory, News & General
Topic: If it were March, 2000, would you still allocate 50% to Stocks?
Replies: 94
Views: 6546

Re: If it were March, 2000, would you still allocate 50% to Stocks?

Dude2 wrote: Wed Aug 08, 2018 10:50 pm I just wish that the OP of this thread and the OP of the thread about why ever own a bond could get into the octagon and work it out.
I would prefer the thunderdome. Except two men enter, none leave.
by CantPassAgain
Wed Aug 08, 2018 9:13 pm
Forum: Investing - Theory, News & General
Topic: If it were March, 2000, would you still allocate 50% to Stocks?
Replies: 94
Views: 6546

Re: If it were March, 2000, would you still allocate 50% to Stocks?

I was 100% in stocks in 2000 and almost all of that was in booming tech stocks. It was quite unpleasant to put it mildly and I was retired at the time without an income stream. Pain like that teaches lessons that you don't forget. I learned that balanced portfolios aren't just for sissies especially if you don't have an income stream. At first I couldn't believe the crash and dug a deeper hole buying beaten down tech stocks on the margin. They were cheap but I learned that could get cheaper yet. At some point reality dawned on me and with some frantic portfolio manipulations and using my home as an ATM for a while I was able to survive this crisis--sadder, more skeptical, and wiser about Mr. Market. The good news is that I was 100% investe...
by CantPassAgain
Wed Aug 08, 2018 8:39 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Valuations Too High?
Replies: 229
Views: 18215

Re: Larry Swedroe: Valuations Too High?

Does CAPE10 account for changes in the way earnings are reported due to changes in US GAAP accounting rules over the last 30 years? Doing away with depreciating goodwill was a big one. I'm sure there are several others. Does it also adjust for recent tax law changes? What about changes in demographics that effect demand for stocks in general? Technological progress? Or thousands of other factors that effect the future that we have to guess at?
by CantPassAgain
Wed Aug 08, 2018 8:29 pm
Forum: Investing - Theory, News & General
Topic: [Deleted] [Re: (NEW) WisdomTree 90/60 U.S. Balanced Fund]
Replies: 652
Views: 86123

Re: (NEW) WisdomTree 90/60 U.S. Balanced Fund

So I've never been very good with derivatives. This fund is using futures contracts in order to try to beat the market return. If it works, and the fund "wins" by beating the market return, who is the party that "loses"? I'm guessing the counterparties on the other side of the futures contracts. Yes? No? Not even wrong?
by CantPassAgain
Wed Aug 08, 2018 3:39 pm
Forum: Investing - Theory, News & General
Topic: If it were March, 2000, would you still allocate 50% to Stocks?
Replies: 94
Views: 6546

Re: If it were March, 2000, would you still allocate 50% to Stocks?

reformed.trader wrote: Wed Aug 08, 2018 3:27 pmIs the OP saying you should go from US stocks to cash or bonds? Or is he simply saying why buy US when you can buy EM or other cheaper countries?
I suspect he doesn't know or hasn't thought about it, and that the contributions thus far are meant primarily to generate responses (well done, op).
by CantPassAgain
Wed Aug 08, 2018 3:33 pm
Forum: Investing - Theory, News & General
Topic: "Don't Obsess About Expense Ratios"
Replies: 240
Views: 29393

Re: "Don't Obsess About Expense Ratios"

Pre-Fidelity announcement: "Lowest expense ratio possible is essential!" Post-Fidelity announcement: "Actually, don't worry about them! Stay with Vanguard!" That's a rather uncharitable knee-jerk reaction. It's more like: "Pre-fidelity announcement: "Keep costs low. Instead of that 1.5% actively managed stock fund in your 401K, use the 0.15% S&P500 index fund they offer. Also, you might consider moving your taxable account from Edward Jones/John Hancock/Local Bank/etc to a discount broker like Vanguard, Fidelity, Schwab, or T Rowe price to take advantage of the very low fee index funds they offer and also avoid AUM fees." Post-fidelity announcement: Fidelity is going to offer zero-fee index funds and ...
by CantPassAgain
Wed Aug 08, 2018 2:51 pm
Forum: Investing - Theory, News & General
Topic: If it were March, 2000, would you still allocate 50% to Stocks?
Replies: 94
Views: 6546

Re: If it were March, 2000, would you still allocate 50% to Stocks?

And I've yet to hear a compelling argument why anyone would possibly invest in the SP500 at today's valuation level. Really? No one has used the words "long-term investment" yet? I could have sworn I saw those words already. Can you give me a compelling argument why anyone would have possibly invested in SP500 in 1996? I did, and all that money I had invested that year is nearly 7x what it was in 1996. Valuation levels are SIGNIFICANTLY higher today than they were in 1996. Despite this fact, you would have been sitting on a loss 13 years later in 2009 (inflation adjusted, dividends reinvested) Alternatively if you had purchased a bond in 1996, you could have locked in a "guaranteed" CAGR of 6% and more than doubled your...
by CantPassAgain
Wed Aug 08, 2018 2:42 pm
Forum: Investing - Theory, News & General
Topic: Fidelity Files for Four Fidelity ZERO℠ Funds (0.00% ER)
Replies: 814
Views: 112892

Re: Fidelity Files for two Fidelity ZERO℠ Funds (0.00% ER total stock and total international mutual funds)

Thanks. I will be waiting a month, maybe 3. I transferred my USAA taxable account to Vanguard last year, that resulted in a ~$1400 capital gains tax payment. Since then, it has been in VTSAX, with about $7600 in gains, so that would result in a ~$2000 capital gains tax payment if I sell this to move to Fidelity. Starting to rethink things here :P The Fidelity ZERO will save you $24 a year over Vanguard. With a $2,000 capital gains cost to moving, it will only take 83 years and 3 months to break even. It's actually a little more because during that whole time period Fidelity will kick out more capital gains distributions and the Vanguard structure doesn't do that. In addition, you have not yet held your money at Vanguard long enough to reco...
by CantPassAgain
Wed Aug 08, 2018 2:32 pm
Forum: Investing - Theory, News & General
Topic: If it were March, 2000, would you still allocate 50% to Stocks?
Replies: 94
Views: 6546

Re: If it were March, 2000, would you still allocate 50% to Stocks?

HomerJ wrote: Wed Aug 08, 2018 2:25 pm(It also doesn't faze me, because someone JUST as sure as you are today showed up here in 2014, 2015, 2016, and 2017 screaming "Guys, guys! The market is likely to crash soon!")
You forgot 2010, 2011, 2012, and 2013.
by CantPassAgain
Wed Aug 08, 2018 1:16 pm
Forum: Investing - Theory, News & General
Topic: If it were March, 2000, would you still allocate 50% to Stocks?
Replies: 94
Views: 6546

Re: If it were March, 2000, would you still allocate 50% to Stocks?

OP, your example seems to be about someone having all the money they will ever have to invest at one time and deciding when to invest it all. Does that seem realistic to you? Most folks invest over many, many years. How does your scenario work out if someone invests throughout the time period you're talking about? The "boglehead philosophy" should work fine for much of the time. If you're just steadily buying in over time, sometimes you get better prices than others, but on average, it should be a wash. However, dollars invested (or held in investments) when valuations are at historical extremes will tend to get extreme results (in either direction). And I've yet to hear a compelling argument why anyone would possibly invest in t...
by CantPassAgain
Wed Aug 08, 2018 11:55 am
Forum: Investing - Theory, News & General
Topic: "Age in Bonds" fails almost everyone
Replies: 217
Views: 33890

Re: "Age in Bonds" fails almost everyone

Ahh, young people, they can be so sure of themselves. It's adorable when they try to lecture.
by CantPassAgain
Wed Aug 08, 2018 11:43 am
Forum: Investing - Theory, News & General
Topic: If it were March, 2000, would you still allocate 50% to Stocks?
Replies: 94
Views: 6546

Re: If it were March, 2000, would you still allocate 50% to Stocks?

The real problem here with your thinking is that you’re viewing this as a black-white problem where you’re betting all 50% on one particular market and its current high price. Markets can always go higher when they’re expensive and can always go lower when they’re depressed and cheap. A diversified portfolio should have more than just the US market (ideally) and should have bonds and/or cash to provide different sources of return. There’s also various alternative weightings, tilts, or alternatives that could or could not help. There are many, many other nuances to the boglehead philosophy that OP is missing. Like, "stay the course" doesn't mean "never change your asset allocation." We just think (most of us anyway, I ho...
by CantPassAgain
Wed Aug 08, 2018 11:17 am
Forum: Investing - Theory, News & General
Topic: If it were March, 2000, would you still allocate 50% to Stocks?
Replies: 94
Views: 6546

Re: If it were March, 2000, would you still allocate 50% to Stocks?

For instance, if you had invested $1 in the equivalent of the SP500 in August 1929, (after adjusting for inflation and reinvested dividends), the purchasing power of your investment almost 20 years later in May 1949 would still only be ~$1. That's ZERO real growth in almost 20 years. The haystack didn't budge. This is incorrect. https://www.nytimes.com/2009/04/26/your-money/stocks-and-bonds/26stra.html You were back to even by 1936, 7 years after the start of the crash. It looks to me like you DIDN'T account for inflation or reinvested dividends. Dividends were quite large back then, and there was serious DEFLATION during the Great Depression, not inflation. Thank you for the response and NYT link, Homer J. I have seen the NYT article befo...
by CantPassAgain
Tue Aug 07, 2018 4:48 pm
Forum: Investing - Theory, News & General
Topic: "Don't Obsess About Expense Ratios"
Replies: 240
Views: 29393

Re: "Don't Obsess About Expense Ratios"

All you people "calling out" Taylor need to get a grip. Yes, costs matter, but have you done the math on the $ difference between a few basis points? Being out of the market for one day of normal volatility could wipe out 20 years of whatever benefit you might get between moving from a 0.05% ER fund to a 0.00% ER fund. There are so many different, opposing forces working on what your return is going to be that obsessing over the difference of 5 basis points is ludicrous.
by CantPassAgain
Tue Aug 07, 2018 4:36 pm
Forum: Investing - Theory, News & General
Topic: "Age in Bonds" fails almost everyone
Replies: 217
Views: 33890

Re: "Age in Bonds" fails almost everyone

beardsworth wrote: Tue Aug 07, 2018 12:01 pm This vineviz person just joined the forum in mid-May and, as of this morning, has already made more than 800 posts. I hope s/he's remembering to eat and sleep. :)
Every once in a while someone will show up out of nowhere and carpet bomb the forum with hundreds/thousands of posts in a very short amount of time, posts full of facts and figures and statistics, and various dancing on the head of a pin minutia. Usually their bent is "debunking general wisdom" via going down a rabbit hole to Alice In Wonderland. Always makes me wonder. Who are these people? Are they grad students with a lot of time on their hands? Bloggers-to-be, hoping to make a name for themselves? Just plain crazy? No idea.
by CantPassAgain
Mon Aug 06, 2018 4:08 pm
Forum: Investing - Theory, News & General
Topic: Growth Funds
Replies: 5
Views: 915

Re: Growth Funds

JC565, it looks like you have been a member here for a while but for whatever reason have not yet groked what this place is really about. I have read a few of your previous posts and I think maybe starting from square one might be a good idea. So, first I will give you a belated welcome to the forum. You have come to the right place to get a handle on your investing journey away from Edward Jones. Before you do anything else, here's what I would do if I were in your shoes: 1) Read this: https://www.bogleheads.org/wiki/Getting_started 2) Watch all of the videos here. There are ten of them but they are very short. It will take less than an hour: https://www.bogleheads.org/wiki/Video:Bogleheads%C2%AE_investment_philosophy 3) Post your financia...
by CantPassAgain
Sat Jul 28, 2018 1:44 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

Edit. Never mind, no real point
by CantPassAgain
Thu Jul 26, 2018 1:57 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

I think it's important to point out in the case of an "emergency".. the index investor liquidates $100K and has to pay 15-38% tax on it, even more if it's in a tax sheltered account. The cash flow that my rentals throw off has been TAX FREE since I started renting out my first space. I carry a $100-200K "emergency fund" at all times, but really this is also used to fund the next real estate deal. Very shortly, I will cash out $165K from a refi, these funds are tax exempt. I will be paying a 4% interest rate over 30 years on this amount, but all of this tax free profit was created solely through property appreciation! (Thank you banks for lending) Bottom line is, in the case of an emergency - cash really is king. Expecia...
by CantPassAgain
Thu Jul 26, 2018 1:08 pm
Forum: Investing - Theory, News & General
Topic: Best source for simple market news?
Replies: 26
Views: 2791

Re: Best source for simple market news?

acegolfer wrote: Thu Jul 26, 2018 7:23 am wsj.com > Markets > 1st article > the 1st 2-3 paragraphs
Yep. Also: reuters.com. Front page
by CantPassAgain
Wed Jul 25, 2018 3:10 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

EDIT: Can you value the business you work at Corn? Not sure if you have access to that information. Sometimes being a business owner and experiencing how a business works -- cash needs -- etc helps one to learn how to value a business (this isn't always the case). I can't find the quote but someone said: "Being in business has made me a better investor. Being an investor has made me better at business" -- I'm probably paraphrasing there. I'm a big Buffett/Munger fan so one of them may have said that, I couldn't find it on a quick lookup though. I have seen professional business valuations from different firms up close and personal and they wildly vary. I have also seen private equity folks put together projected cash flows based ...
by CantPassAgain
Wed Jul 25, 2018 1:48 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

WanderingDoc wrote: Wed Jul 25, 2018 1:17 pmSomeone has thought his whole life (via indoctrination by the media, news, banks, Wall Street, and politicians) that the best way to retire comfortably is to invest in index funds...
lol wut.

Also, I think most would agree that the best path to a comfortable retirement is to find something you are good at and make a lot of money doing that, and saving some of it along the way.

Do you not save any money? Or is the plan to cash flow everything via your real estate business?
by CantPassAgain
Wed Jul 25, 2018 9:31 am
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

WanderingDoc wrote: Wed Jul 25, 2018 1:08 amIs it a meaningful term. The quotes don't make sense. Real estate pays you in cash flow, capital appreciation, amortization/principal paydown, force value, inflation hedging/profiting, depreciation, net tax benefit. Equities pays you in capital appreciation and a 1.5-2.5% dividend, which is quite laughable.
You don't think companies you own via publicly traded stocks do all of those things?
by CantPassAgain
Tue Jul 24, 2018 2:48 pm
Forum: Personal Finance (Not Investing)
Topic: Which doctor should I go to?
Replies: 26
Views: 2090

Re: Which doctor should I go to?

OP hasn't responded, clearly he/she didn't do anything and has now died of food poisoning. Shame on you all.
by CantPassAgain
Tue Jul 24, 2018 10:39 am
Forum: Investing - Theory, News & General
Topic: I don’t understand the concept of cost of equity
Replies: 26
Views: 2849

Re: I don’t understand the concept of cost of equity

acegolfer wrote: Tue Jul 24, 2018 9:50 am 1. cost of equity is the cost to the issuer (=firms). It's not the cost to the investor (who funds the firms).
2. a firm's equity needs to pay enough return to the investors. Otherwise (risk-free rate in OP example), then investors will not fund the firm because equity is inherently riskier than debt.
3. this "required rate of return" the firm needs to provide to the investor is called "cost of equity" in finance.

Hope this simple explanation helps. If not, I'll explain more in detail.
This was always my understanding of cost of equity. It is always helpful to first explain what parties certain terms apply to but so few ever do that when trying to explain simple concepts, for whatever reason.
by CantPassAgain
Fri Jul 20, 2018 11:43 am
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

The error in this thread is comparing leveraged real estate returns to un-leveraged equity returns. The 38% figure cited earlier is for real estate that is 5X leveraged. If you leverage the S&P 500 5X, you would get an average return of something like 55%. Thus, the 38% figure is real, as a leveraged, and thus riskier, return. Stocks still beat real estate if you compare apples to apples; i.e., un-leveraged returns to un-leveraged returns or leveraged returns to leverage returns. Well, yeah. It's like someone comes on here and says, "My business that I started is doing great and it's so easy, you are all closed minded shlubs wasting your lives working shlub jobs and being so mediocre. Look at how great I am with my 10x leveraged r...
by CantPassAgain
Thu Jul 19, 2018 11:55 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

I calculate IRRs for a living. For any investment, IRR (Internal Rate of Return) and NPV (Net Present Value) are the two definitive metrics for deciding to invest or not. Its very easy to calculate in MS Excel. Decide on the life of the building (IRS defines life of residential building as 27.5 year and commercial buildings as 39 years). Post this period, building value is zero. Land doesn't depreciate. List your monthly cash flows in a column in MS Excel for 27.5 years, assuming residential building here (outflow in negative, inflow in positive). List the corresponding dates in the next column. Add a terminal value for the value of the land after 27.5 years as inflow, assuming you own the land. Use IRR or XIRR function and it will give yo...
by CantPassAgain
Thu Jul 19, 2018 11:44 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

The relevant question for an investor is how much he has been able to put in his pocket from the day he purchased the property through day he finally disposed of it. That is going to be the same amount whether he puts down 10% or 20%. say what There is only one profit to be made per property. How so? :?: Well, it isn't the same amount amount of "profit" regardless of down payment and there isn't "just one profit to be made per property" if I am understanding what you mean when you say that. Financing costs play a role. A very simplified example ignoring transaction costs/taxes/maintenance/price appreciation/etc: A) $200,000 property purchased with 10% down 15 years mortgage at 3% rented out at $2,000 a month: At the end...
by CantPassAgain
Thu Jul 19, 2018 11:17 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

gmaynardkrebs wrote: Thu Jul 19, 2018 11:13 pm
CantPassAgain wrote: Thu Jul 19, 2018 11:08 pm
gmaynardkrebs wrote: Thu Jul 19, 2018 10:13 pmThe relevant question for an investor is how much he has been able to put in his pocket from the day he purchased the property through day he finally disposed of it. That is going to be the same amount whether he puts down 10% or 20%.
say what
There is only one profit to be made per property.
How so?
by CantPassAgain
Thu Jul 19, 2018 11:08 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

gmaynardkrebs wrote: Thu Jul 19, 2018 10:13 pmThe relevant question for an investor is how much he has been able to put in his pocket from the day he purchased the property through day he finally disposed of it. That is going to be the same amount whether he puts down 10% or 20%.
say what
by CantPassAgain
Thu Jul 19, 2018 4:59 pm
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

Next to owning a dog, I'd say that IRR is the best way to make yourself feel like a master of the universe for doing absolutely nothing. Internal rate of return is the most comprehensive, honest way to report investment returns. What is the: A) Date and amount of the beginning investment B) What were the portfolio contributions and withdrawal amounts and dates during the measurement period, and C) What is the ending investment amount and date. From there you get the real picture of investment performance. For real estate investments, one has to tweak a few definitions to get to the answer but it's essentially the same: A) The beginning investment value is the out of pocket cash layout at the outset (downpayment, ALL financing costs, every ...
by CantPassAgain
Wed Jul 18, 2018 11:07 am
Forum: Investing - Theory, News & General
Topic: Direct Real Estate Returns
Replies: 361
Views: 24614

Re: Direct Real Estate Returns

I have never done the house-hack but I did live in a place that I later turned into a rental. Bought the place with a $30K down payment (even though VA loan). The property produces $12K of rental income per year like clockwork, plus an additional $4K due to a 100% passive investment I arbitraged using a HELOC. Thats a >50% return in perpetuity. $30K down payment. What were the closing costs? When was the deal executed? $12K rental income. What is the monthly mortgage payment, total with prop taxes and insurance? Do you use a property management company on this property? What is the monthly charge? Any income taxes paid? How much have you paid for maintenance? If you just took your actual, real life NET cash flows after all costs from the p...
by CantPassAgain
Wed Jul 11, 2018 4:45 pm
Forum: Personal Finance (Not Investing)
Topic: What rate of return are you using for retirement projections?
Replies: 106
Views: 14673

Re: What rate of return are you using for retirement projections?

Whichever one gets me to a million dollars at age 55.
by CantPassAgain
Tue Jul 03, 2018 8:01 pm
Forum: Investing - Theory, News & General
Topic: "homemade dividends" from Total Stock Market fund
Replies: 135
Views: 12262

Re: "homemade dividends" from Total Stock Market fund

Profitability and increasing earnings retained in the business (equity) would cause a stocks price to increase in a rational market. In other words, a rational player would see that out of two identical companies with the same future earnings prospects and identical balance sheets except for cash/retained earnings, the one with higher cash/retained earnings should command a higher stock price. Now, of course no two companies are absolutely identical but that's the idea. A cash dividend reduces cash/retained earnings and thus the value of the enterprise. The difficulty in parsing all of this comes down to changing market expectations which masks the more rational aspects of company valuation in daily noise of the market. But over time, it pl...
by CantPassAgain
Thu Jun 28, 2018 8:50 am
Forum: Personal Investments
Topic: Stocks vs. rental property
Replies: 101
Views: 16590

Re: Stocks vs. rental property

I grew up in SF, lived there for 35 years, own rental property there, my parents owned several rental properties -- so I know all about what kind of stuff we had to do to stretch to make it happen. This is the reason why your posts sound like "Trump University get rich quick as real estate magnate" sales pitch -- because you give examples that simply are not realistic. You'd find more receptive responses if you only used personal examples that actually happened. Also cut out the talk about "oh man, you just gonna be a company slave for the next 40 years". You have zero idea how good or bad some of us have done with only mutual funds -- or dedicating our time instead to careers, businesses. +1. All of his posts read like...
by CantPassAgain
Wed Jun 27, 2018 2:22 pm
Forum: Personal Investments
Topic: Stocks vs. rental property
Replies: 101
Views: 16590

Re: Stocks vs. rental property

The problem with this debate, which has already been stated, is that it is apples to nuts. The above "80x return > 15x return" is completely missing why *MOST* people buy real estate. That return is purely based on appreciation. Most people buy rental properties for 1) cash flow and 2) have someone else pay off a mortgage. Appreciation is considered a bonus. I don't live in San Fran but a quick look online I am guessing that rent on 1.5 mil house would be in the range of $8,000 - $10,000+ per month. Now, that $80k was paid upfront so no mortgage. Going on $8,000 per month, $96,000 a year a tenant is giving you to live there. Let's say after expenses (insurance, taxes, vacancy, wear/rehab) you have a cash flow of $60,000 a year at...
by CantPassAgain
Tue Jun 26, 2018 2:10 pm
Forum: Personal Investments
Topic: Stocks vs. rental property
Replies: 101
Views: 16590

Re: Stocks vs. rental property

If you had bought in Southern California in 1989, you would in most cases not have seen your house return to the price you bought it at for almost 10 years. Meanwhile, your stock portfolio (S&P500) would have more than tripled. And in the middle of this, around 1992-4, you would be under your original price. So is now 1989, or 1999, or something in between? That literally makes no sense. Houses in the Bay Area which were bought for $60-80K in the 70s, are selling for over $1.5M right now. That is a >15X return. I'm not sure what buying a house in the Bay Area in the 70's has to do with buying a house in Southern California in 1989, but anyway it would be nice if one of the portfolio visualizer knowledgeable folks could show what $80,00...
by CantPassAgain
Sun Jun 10, 2018 11:37 am
Forum: Investing - Theory, News & General
Topic: Buffett says Bonds are a terrible investment now. What should we invest in besides stocks?
Replies: 157
Views: 32444

Re: Buffett says Bonds are a terrible investment now. What should we invest in besides stocks?

I'm not sure why either. I've been trying to understand for nearly a year on this forum. The minds on this forum are very bright, much smarter than me. I have learned a ton in a short time. But people on here will insist to invest in inferior assets by nearly every single metric except liquidity. The sentiment is to invest in index funds, work full time for 30 years, and hopefully by then you can withdraw 4% and have enough for a mediocre to average retirement. Hopefully. Those of us who actually took the time to learn the real estate game, have achieve enough passive income from real estate (in 5-7 years or much less) to cover our living expenses. No one is saying you HAVE to retire at 35, but having the option sure is sweet. That is call...
by CantPassAgain
Sat Jun 09, 2018 8:32 am
Forum: Investing - Theory, News & General
Topic: Buffett says Bonds are a terrible investment now. What should we invest in besides stocks?
Replies: 157
Views: 32444

Re: Buffett says Bonds are a terrible investment now. What should we invest in besides stocks?

I'm not sure why either. I've been trying to understand for nearly a year on this forum. The minds on this forum are very bright, much smarter than me. I have learned a ton in a short time. But people on here will insist to invest in inferior assets by nearly every single metric except liquidity. The sentiment is to invest in index funds, work full time for 30 years, and hopefully by then you can withdraw 4% and have enough for a mediocre to average retirement. Hopefully. Those of us who actually took the time to learn the real estate game, have achieve enough passive income from real estate (in 5-7 years or much less) to cover our living expenses. No one is saying you HAVE to retire at 35, but having the option sure is sweet. That is call...
by CantPassAgain
Thu Jun 07, 2018 4:57 pm
Forum: Personal Investments
Topic: which vanguard funds for my situation?
Replies: 7
Views: 796

Re: which vanguard funds for my situation?

I've read through most of the wiki here and found no specific recommendation of the mutual funds to pick in vanguard. I have about 33k in a Roth IRA, 29 years old, like to retire at 50, not very risk averse. Right now all my money is in the 2055 retirement fund. I'm wondering if there's a better allocation with lower fees that's more appropriate like VTSAX, VFIAX, and some other bonds or funds. I could find no recommendations for which funds to choose in my research. The Vanguard target retirement funds are "funds-of-funds" holding a collection of vanguard index funds, usually 4. I will leave it to you to find out that those funds are. Vanguard believes these funds are the basic building blocks of a diversified index fund portfol...
by CantPassAgain
Thu Jun 07, 2018 1:23 pm
Forum: Personal Investments
Topic: Help me pick my vanguard investment
Replies: 39
Views: 3289

Re: Help me pick my vanguard investment

Maybe you need to back up and examine why you want the "highest possible return," and understand that higher return always means higher risk of not getting those returns and falling short of your goals. Shooting for the moon is great when you win. When you lose it can be ruinous. It seems like you want quick and easy answers and the hard truth is, there aren't any. But that doesn't mean investing has to be difficult. You might want to take a look at the boglehead wiki, starting here: https://www.bogleheads.org/wiki/Getting_started And watching all of the videos here: https://www.bogleheads.org/wiki/Video:Bogleheads%C2%AE_investment_philosophy Then read a book or two and ask questions on the forum regarding what you learned (or thi...
by CantPassAgain
Thu Jun 07, 2018 10:35 am
Forum: Personal Investments
Topic: Help me pick my vanguard investment
Replies: 39
Views: 3289

Re: Help me pick my vanguard investment

detroitdiablo wrote: Thu Jun 07, 2018 10:11 amThat answers a question, but SCV is not a choice for me. The 4 funds listed are the choice so if you had to pick the most aggressive package using only the 4 funds what would it be? I know this is only an educated opinion, not gospel. Is 100% small cap index close enough to value?
Probably. Just know that the word "aggressive" means a very wide range of possible outcomes.

A lot of folks go with either market weight or market weight with a tilt to small cap.
by CantPassAgain
Thu Jun 07, 2018 10:18 am
Forum: Personal Investments
Topic: Help me pick my vanguard investment
Replies: 39
Views: 3289

Re: Help me pick my vanguard investment

I know using past performance to predict the future is almost a no no but doesn't 20 years worth of data have to count for something? It's not like a new fund is made 2 years ago and makes large amounts of interest in that time on a hot sector fund and you jump on it when the money is already been made and you see those scewed returns. Right? 20 years of data albeit can't predict the future returns but shouldn't it give you a really good read that it will keep that course? No. Starting points and end points matter just as much, if not more, than just number of years. What if a particular fund did terribly for 17 years and then in the last 3 years had spectacular gains that made the 20 year return look good? Or vice versa? Or you shift your...
by CantPassAgain
Wed Jun 06, 2018 6:11 pm
Forum: Investing - Theory, News & General
Topic: Just added bonds to portfolio
Replies: 44
Views: 4302

Re: Just added bonds to portfolio

I'm getting married next month and last week the fiancee and I decided to set a combined investment plan. Up until recently, we had just been investing in 100% equities with no real plan, and decided that it might be smart to move to a 50% domestic stock (VTSAX), 35% international stock (VTIAX), 15% bond (VBTLX) allocation with annual rebalancing for the long haul. Especially since we are looking to retire early, potentially in the next 5 years. After jumping in and rebalancing from 100% domestic and international stocks to our 50/35/15 AA last week, stocks have been on a tear and bonds have been going DOWN! I know it's probably just the short-term jitters, but was this a smart move to make? I would hate to have just done something that wi...
by CantPassAgain
Wed Jun 06, 2018 4:52 pm
Forum: Personal Investments
Topic: Should I put some money aside in money market for market correction
Replies: 94
Views: 10928

Re: Should I put some money aside in money market for market correction

Great point. In January the S&P edged higher than it is today, so the dollar cost averagers essentially made nothing since the market corrected their January/early February injections. So if you put money aside for the correction instead and purchased on March 23rd, you would be up 7.1% or 34.61% annualized. Market timing won...again. DXQLX is up about 25% since I purchased it February 8, or about 75% annualized. Flat if you held on/cost averaged since January highs, but way up if you timed the market and bought on the dip...with money set aside OP, and top fund managers, and those who don't fear waiting to buy low. I'll continue to improve my out-sized returns, others can stick with 8% long term averages minus whatever inflation eats ...
by CantPassAgain
Wed Jun 06, 2018 4:33 pm
Forum: Personal Investments
Topic: Should I put some money aside in money market for market correction
Replies: 94
Views: 10928

Re: Should I put some money aside in money market for market correction

JoeRetire wrote: Wed Jun 06, 2018 4:23 pm
md&pharmacist wrote: Wed Jun 06, 2018 2:47 pm I didn't tell you IN January. I told you that AFTER January the markets would continue to cool off for a couple of months since I told you this.
Maybe you could provide the link (or even date) of the post where you said that after January the markets would cool off for a couple of months?
Which months were cool?
There has literally been one day that the S&P 500 was lower between closing on 03/23/2018 (the first day "md&pharmacist" posted) and closing today. One day. I'd say that's pretty cool 8-)
by CantPassAgain
Wed Jun 06, 2018 4:02 pm
Forum: Personal Investments
Topic: Should I put some money aside in money market for market correction
Replies: 94
Views: 10928

Re: Should I put some money aside in money market for market correction

But no need to go to great lengths to convince or impress. Almost every single one of your posts mentions your $10 million NW, and how smart you are. you doth protest too much, methinks. Look, all you are doing is making yourself LESS credible. Trying making some predictions in advance instead of telling us how amazing you were in the past. I told you that after January the markets were likely to take a breather for a few months. Did they? Also, I can't help you if you see no value in learning from history. Your first post was March 23rd, 2018. I didn't tell you IN January. I told you that AFTER January the markets would continue to cool off for a couple of months since I told you this. March 23rd, 1 day before your first post: S&P 500...