Search found 175 matches

by mjb
Mon Jul 27, 2020 5:30 pm
Forum: Personal Finance (Not Investing)
Topic: Using IB margin to pay off mortgage
Replies: 37
Views: 2419

Re: Using IB margin to pay off mortgage

Do you have any bonds in your brokerage account? Could you sell the bonds and pay off your mortgage, allowing you to carry a more aggressive stock allocation? Maintenance margin at IBKR is 25%. That means IBKR will start to sell your securities when the remaining equity is less than 25% of remainin...
by mjb
Sun Jul 26, 2020 3:09 pm
Forum: Personal Finance (Not Investing)
Topic: Have 30-year mortgage rates fallen in last month? Advice for requesting re-lock
Replies: 33
Views: 2730

Re: Have 30-year mortgage rates fallen in last month? Advice for requesting re-lock

aqan wrote:
Sun Jul 26, 2020 2:53 pm
Which bank is offering 2.75% these days? I can’t even get close to 3% to refi my 700k.
Jumbo's are having problems right now.

I have a conforming and just got quoted 2.625% no points
by mjb
Thu Jul 23, 2020 6:36 am
Forum: Investing - Theory, News & General
Topic: Benefits of NTSX Exhausted due to Low Treasury Yields?
Replies: 14
Views: 1052

Re: Benefits of NTSX Exhausted due to Low Treasury Yields?

NTSX is a little different because of futures. What its return ends up being is a little different. 90% of the return matches thr s&p 500. However, the other 60% is basically the spread between the 3 month tbill and the weighted average of the treasury bonds. Technically you could have negative rate...
by mjb
Sun Jul 19, 2020 3:52 pm
Forum: Investing - Theory, News & General
Topic: Biggest regrets and advice for newbies.
Replies: 30
Views: 3681

Re: Biggest regrets and advice for newbies.

Biggest mistake in investing is doing nothing. Just pick an allocation, a percent of your monthly income, and autoinvest it every paycheck.

Biggest mistake in finance is spending beyond your means
by mjb
Sun Jul 19, 2020 1:02 pm
Forum: Investing - Theory, News & General
Topic: WisdomTree 90/60 U.S. Balanced Fund [NTSX]
Replies: 367
Views: 31587

Re: NTSX--a mostly free lunch for hedging downside risk?

SWAN is the better instrument for downside protection. https://www.portfoliovisualizer.com/fund-performance?s=y&symbol=VOO&symbols=SWAN&benchmark=NTSX Looks at the Dec 2018 and Mar 2020 crashes Interesting. So, if I read the description at etf.com correctly, SWAN is targeting 70% equity exposure an...
by mjb
Mon May 25, 2020 11:52 am
Forum: Investing - Theory, News & General
Topic: Can Taleb's risk mitigation strategy be implemented by retail investors (if so how)?
Replies: 27
Views: 2097

Re: Can Taleb's risk mitigation strategy be implemented by retail investors (if so how)?

SWAN is rather different. It is 90% treasuries and 10% ITM options.

Taleb's approach was >95% stocks and the rest downside protection options.
by mjb
Sun May 24, 2020 5:05 pm
Forum: Investing - Theory, News & General
Topic: Can Taleb's risk mitigation strategy be implemented by retail investors (if so how)?
Replies: 27
Views: 2097

Re: Can Taleb's risk mitigation strategy be implemented by retail investors (if so how)?

It seems that all Taken actually does is treat 3,4,5, and 6 STD from the mean and assumes that each event can happen if each had a probably of 1%. This is a standard technique in some engineering circles. For instance, on the nuclear industry, by law anything must survive a 12 sigma (6 from the mean...
by mjb
Fri May 01, 2020 3:44 pm
Forum: Investing - Theory, News & General
Topic: Bill Bernstein: Why value is dead
Replies: 96
Views: 9187

Re: Bill Bernstein: Why value is dead

I think value factor investing may be dead due to increasing disruption in industries beyond tech. Disruption changes the economics that mean reversion is based upon, namely, that the cheap companies economics will become similar to the expensive companies economics. In the case of disruption, valu...
by mjb
Sun Mar 08, 2020 8:13 pm
Forum: Personal Finance (Not Investing)
Topic: 30 year mortgage under 3%
Replies: 301
Views: 46698

Re: 30 year mortgage under 3%

Everyone I have talked to on the broker side has said rates won't drop further as long as demand is high.
by mjb
Sun Mar 08, 2020 8:06 pm
Forum: Personal Investments
Topic: question about tax-exempt bond funds (vwiux or vteax)
Replies: 2
Views: 269

Re: question about tax-exempt bond funds (vwiux or vteax)

As previously mentioned, check the wiki.

In general, tax exempt bonds start to look good once Federal tax rates exceed ~25% .

Otherwise, they function like other bonds of similar credit rating and terms
by mjb
Thu Mar 05, 2020 8:03 am
Forum: Investing - Theory, News & General
Topic: Adding margin to Hedgefundie's 3x leveraged ETF Strategy
Replies: 38
Views: 2577

Re: Adding margin to Hedgefundie's 3x leveraged ETF Strategy

Ok, calm down, this is bogleheads, not Reddit wallstreetbets. You are talking about a lot of leverage
by mjb
Wed Mar 04, 2020 8:08 am
Forum: Personal Finance (Not Investing)
Topic: 30 year mortgage under 3%
Replies: 301
Views: 46698

Re: 30 year mortgage under 3%

So the average 10 year treasury to 30 year mortgage spread is around 1.6% with a range of 1 to 2.1. I have a conforming loan and have put out feelers. The no point 30 year refi resulted in a low of 3.001% and a high of 4.750% . All the budget companies shot way up and traditional were giving a good ...
by mjb
Sun Mar 01, 2020 12:03 pm
Forum: Investing - Theory, News & General
Topic: Risk Parity Allocation Percentage
Replies: 18
Views: 1344

Re: Risk Parity Allocation Percentage

Uncorrelated, I get that you like having your way, but you never give up when you bluff your way through something. You just bury it.
by mjb
Sun Mar 01, 2020 10:27 am
Forum: Investing - Theory, News & General
Topic: Risk Parity Allocation Percentage
Replies: 18
Views: 1344

Re: Risk Parity Allocation Percentage

A bucket is not suitable to isolate a good strategy from a bad strategy. If you rebalance between buckets, a bad strategy has the potential to draw down the entire portfolio. If you don't rebalance between buckets, then your strategy is path dependent and you are market timing. Path dependent is no...
by mjb
Sun Mar 01, 2020 9:20 am
Forum: Investing - Theory, News & General
Topic: Risk Parity Allocation Percentage
Replies: 18
Views: 1344

Re: Risk Parity Allocation Percentage

I disagree with uncorrelated. Bucketing is a perfectly valid way to separate strategies. Whether it is a bucket in a CEF style or constant equal allocations of future to each, those are acceptable and act as a firewall from a bad strategy affecting the whole portfolio. Normal bogleheads already do t...
by mjb
Fri Feb 28, 2020 4:52 pm
Forum: Investing - Theory, News & General
Topic: Why do companies give dividends?
Replies: 56
Views: 4480

Re: Why do companies give dividends?

If they don't have invest opportunities, why not repurchasing their own stock? For investors, it's more tax efficient this way. Why there is no company that just invests on SP500 w/o ever giving dividends (kind of BRK, but w/o trying to beat the market) All investing is giving someone cash now for ...
by mjb
Fri Feb 28, 2020 4:36 pm
Forum: Investing - Theory, News & General
Topic: Anybody want to guess the bottom of this "dip"?
Replies: 573
Views: 38351

Re: Anybody want to guess the bottom of this "dip"?

GaryA505 wrote:
Fri Feb 28, 2020 3:37 pm
Anybody want to guess the bottom of this "dip"?

Dust off your crystal balls (no jokes please) and give it a try!

Maybe we'll come back here in a few months (or years) and see who had the best guess.

I'll start: -20%
-100% by 2020202020

I assume that by then we won't be trading stocks
by mjb
Tue Feb 25, 2020 8:52 pm
Forum: Investing - Theory, News & General
Topic: Created a Treasury Ladder Today (similar to NTSX)
Replies: 21
Views: 2200

Re: Created a Treasury Ladder Today (similar to NTSX)

So what is your overall portfolio composition?
by mjb
Mon Feb 24, 2020 4:52 am
Forum: Investing - Theory, News & General
Topic: What to pair with NTSX?
Replies: 227
Views: 16901

Re: What to pair with NTSX?

One thing to consider is NTSX has a ceiling on who will use it. One can easily replicate it for the same or lower costs using SPY, a high interest savings account, and treasury futures. The advantage of NTSX is an individual investor is that because most treasury futures are in 100k blocks, it is ha...
by mjb
Sat Feb 22, 2020 4:53 pm
Forum: Investing - Theory, News & General
Topic: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com
Replies: 133
Views: 14427

Re: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com

Why you think Arith mean – 0.5xSD^2 is bad approximation for the geometric mean. I understand that its not 100% perfect for investment returns (which are nearly normal but not normal) but you do know how small the error on that formula is right? If I say the geo return is 1.05% and it truly is 1.04...
by mjb
Sat Feb 22, 2020 3:35 pm
Forum: Investing - Theory, News & General
Topic: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com
Replies: 133
Views: 14427

Re: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com

The academic approach is to use the arithmetic excess return, the return above the t-bill rate. This figure stays stable during periods of inflation/deflation. I think the idea of calculating the arithmetic return based on anything less than the full sample is an extremely bad idea. There is a wide...
by mjb
Sat Feb 22, 2020 3:13 pm
Forum: Investing - Theory, News & General
Topic: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com
Replies: 133
Views: 14427

Re: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com

I read his blog. He has some good points about geometric mean and effects of rebalancing. However, he has some math errors that really skew his results and he ignores anyone that points them out. Mainly his conversion from arithmetic to geometric. Additionally, several of his assumptions aren't ful...
by mjb
Fri Feb 21, 2020 8:26 pm
Forum: Investing - Theory, News & General
Topic: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com
Replies: 133
Views: 14427

Re: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com

The academic approach is to use the arithmetic excess return, the return above the t-bill rate. This figure stays stable during periods of inflation/deflation. I think the idea of calculating the arithmetic return based on anything less than the full sample is an extremely bad idea. There is a wide...
by mjb
Fri Feb 21, 2020 8:25 pm
Forum: Investing - Theory, News & General
Topic: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com
Replies: 133
Views: 14427

Re: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com

I read his blog. He has some good points about geometric mean and effects of rebalancing. However, he has some math errors that really skew his results and he ignores anyone that points them out. Mainly his conversion from arithmetic to geometric. Additionally, several of his assumptions aren't ful...
by mjb
Wed Feb 19, 2020 5:22 pm
Forum: Investing - Theory, News & General
Topic: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com
Replies: 133
Views: 14427

Re: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com

His calculation for arithmetic mean is wrong. It is not the generalized form and as a specific form it is incorrect as well. To prove it, just use Excel for arithmetic mean and geometric mean. All he is doing is a more complex risk parity system. However, you will never match what he gets because a...
by mjb
Wed Feb 19, 2020 12:44 pm
Forum: Investing - Theory, News & General
Topic: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com
Replies: 133
Views: 14427

Re: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com

It's also still likely that, despite the constant tinkering and testing, my code isn't the same as his theory. thanks! look at this for expected return: https://breakingthemarket.com/the-ultimate-401k-strategy/ I've been waiting for a better explanation myself since following the dollars and data l...
by mjb
Sat Feb 15, 2020 4:24 pm
Forum: Investing - Theory, News & General
Topic: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com
Replies: 133
Views: 14427

Re: Fascinating take on a rebalanced Permanent Portfolio - BreakingTheMarket.com

I read his blog. He has some good points about geometric mean and effects of rebalancing. However, he has some math errors that really skew his results and he ignores anyone that points them out. Mainly his conversion from arithmetic to geometric. Additionally, several of his assumptions aren't full...
by mjb
Thu Feb 13, 2020 1:35 pm
Forum: Investing - Theory, News & General
Topic: Increasingly Large Spreads with NTSX
Replies: 25
Views: 1764

Re: Increasingly Large Spreads with NTSX

Thank you for sharing the paper.. I buy 2y and 5y treasury futures.. I have bought 10y futures in the past, now hold 2y and 5y only.. What would you suggest as a good resource for learning more. I have mostly seen high level commentary but no detailed guides. Also,.what are you doing now that the y...
by mjb
Thu Feb 13, 2020 10:27 am
Forum: Investing - Theory, News & General
Topic: Increasingly Large Spreads with NTSX
Replies: 25
Views: 1764

Re: Increasingly Large Spreads with NTSX

Thank you for sharing the paper.. I buy 2y and 5y treasury futures.. I have bought 10y futures in the past, now hold 2y and 5y only.. What would you suggest as a good resource for learning more. I have mostly seen high level commentary but no detailed guides. Also,.what are you doing now that the y...
by mjb
Sat Feb 08, 2020 2:14 pm
Forum: Investing - Theory, News & General
Topic: Another Bond Funds Thread - Discussing Scenarios And Choices
Replies: 4
Views: 532

Re: Another Bond Funds Thread - Discussing Scenarios And Choices

So, just some food for thought. Short term bonds are for liquidity purposes for corporations and also regulatory purposes. Long term bonds are really for institutions and regulatory purposes of large firms. Intermediate term bonds can take advantage of the yield difference, "ride the yield curve" an...
by mjb
Mon Jan 27, 2020 1:42 pm
Forum: Investing - Theory, News & General
Topic: [Deleted] [Re: (NEW) WisdomTree 90/60 U.S. Balanced Fund]
Replies: 652
Views: 69304

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

Basically, I would like a NTSX but with TSM and TISM instead of just the S&P500.
by mjb
Mon Jan 27, 2020 11:39 am
Forum: Investing - Theory, News & General
Topic: [Deleted] [Re: (NEW) WisdomTree 90/60 U.S. Balanced Fund]
Replies: 652
Views: 69304

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

For B, I haven’t found anyone that will do this cheaply. This would actually be my preferred option if it was easily available. Has anyone been able to successfully do this? For C and D, I'm not sure I'd want to deal with the hassle factor. I think perhaps schwab does, but the margin rates are craz...
by mjb
Mon Jan 27, 2020 8:03 am
Forum: Investing - Theory, News & General
Topic: [Deleted] [Re: (NEW) WisdomTree 90/60 U.S. Balanced Fund]
Replies: 652
Views: 69304

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

Can we please keep the volatility stuff to the hedgefundie thread? I am very interested and the NTSX style of unleveraged equities with leveraged treasury exposure via futures. It seems like a tax efficient way to have treasuries in a taxable account and to modestly improve returns. I have been look...
by mjb
Sun Jan 19, 2020 7:06 pm
Forum: Investing - Theory, News & General
Topic: Better to pay off mortgage or buy CD?
Replies: 24
Views: 2272

Re: Better to pay off mortgage or buy CD?

One thing to thing about is a liquidity premium. I tend to put this at around 0.5%. So in other words, if I have two investments, and the post tax return of the liquid investment is greater than 0.5% of the fixed mortgage, then I invest. While it is a slight cost to pay, having liquidity when you ne...
by mjb
Sat Jan 18, 2020 12:14 pm
Forum: Personal Finance (Not Investing)
Topic: Engineers - What are you making? ($$$)
Replies: 357
Views: 44120

Re: Engineers - What are you making? ($$$)

Folks, My observation/opinion in terms of pay. There are 3 levels of engineer's pay: 1) 60K to 80K 2) 80K to 120K 3) 120K to 150K Most engineers top up at 120K to 150K level. In many areas of engineering, the location of where you work (LCOL, MCOL, HCOL, VHCOL) makes a very small difference in your...
by mjb
Fri Jan 17, 2020 9:58 pm
Forum: Personal Finance (Not Investing)
Topic: Engineers - What are you making? ($$$)
Replies: 357
Views: 44120

Re: Engineers - What are you making?

With software engineers and programmers, the general rule is 1 good one is worth 20 to 100 average ones. I have been told by several managers that they feel salaries that are being posted here are steals for "good" talent. As a note to everyone here, while the engineering average is just below 100k ...
by mjb
Sat Jan 11, 2020 5:55 pm
Forum: Personal Investments
Topic: [Deleted]
Replies: 23
Views: 1762

Re: Emerging Bonds: Index (VWOB) vs Active (VEGBX )

Indexing works great for highly liquid national bonds and investment grade bonds from developed nation's. Once you get into less liquid, below investment grade, or other specialty risks, active funds do start to out perform. I remember seeing the stats a few years ago where yes, 90% of active stock ...
by mjb
Fri Jan 10, 2020 7:38 pm
Forum: Investing - Theory, News & General
Topic: Intermediate-Term bond vs Total Bond
Replies: 107
Views: 7271

Re: Intermediate-Term bond vs Total Bond

FWIW, I prefer IT bond index. I really like the ability to "ride the yield curve" as it only holds between 5 and 10 years duration which is kind of a sweet spot. Bonds longer than 10 years are often better suited for institutions. Bonds shorter than 5 years are for liquidity and usually a small inve...
by mjb
Thu Jan 09, 2020 8:04 am
Forum: Investing - Theory, News & General
Topic: [Deleted] [Re: (NEW) WisdomTree 90/60 U.S. Balanced Fund]
Replies: 652
Views: 69304

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

It had 14.9 million in outflows after surging for a while. https://etfdb.com/etf/NTSX/
by mjb
Wed Jan 01, 2020 11:10 am
Forum: Personal Finance (Not Investing)
Topic: EFC of 59K?! That is more than my net pay
Replies: 227
Views: 12906

Re: EFC of 59K?! That is more than my net pay

Klangfool, I know this through my Child's discussions with her classmates. We are not talking about loans. The neighborhood is similar to the one you describe. I guess that one can never be sure about the situations of neighbors. They may have savings and other sources, so they can afford to do it....
by mjb
Tue Dec 31, 2019 7:04 am
Forum: Personal Finance (Not Investing)
Topic: EFC of 59K?! That is more than my net pay
Replies: 227
Views: 12906

Re: EFC of 59K?! That is more than my net pay

You might have to think outside the box here. You say you're a one income family. Could your spouse get a job and that income go just towards college? Each kid has about 14K/year to work with in savings. What can you cash flow? They can take about 27K in Stafford loans over 4 years. Good point. We ...
by mjb
Tue Dec 31, 2019 6:45 am
Forum: Personal Finance (Not Investing)
Topic: EFC of 59K?! That is more than my net pay
Replies: 227
Views: 12906

Re: EFC of 59K?! That is more than my net pay

But to be frank, I really believe that many people have gotten this snobbish attitude about a university education and believe that huge amounts of money must be spent on one in order to get a good one. That's completely false. Most expensive colleges in the United States for the academic year of 2...
by mjb
Fri Dec 27, 2019 9:25 am
Forum: Personal Investments
Topic: Variation on student loans or taxable account question
Replies: 6
Views: 356

Re: Variation on student loans or taxable account question

At 2.6% and tax deductible so roughly 2.3% you are getting a hypercheap loan.

I would keep investing, especially with your AA. I regret paying off mine that were low.
by mjb
Tue Dec 24, 2019 8:06 am
Forum: Investing - Theory, News & General
Topic: [Deleted]
Replies: 5
Views: 567

Re: Active Outperforming - Long Term Bonds Edition

So with the dividend thing fixed, you do see this kind of divergence in the corporate and municipal bond sectors. For both, for smaller companies and municipalities, the rating agencies sometimes lag the real world in changing their rating. This inefficiency had been exploited numerous times. This i...
by mjb
Sun Dec 22, 2019 1:00 pm
Forum: Investing - Theory, News & General
Topic: [Deleted] [Re: (NEW) WisdomTree 90/60 U.S. Balanced Fund]
Replies: 652
Views: 69304

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

I noticed it is now up to 45 million AUM.

I have picked up a few shares as it does seem to be tax efficient.
by mjb
Sun Dec 08, 2019 6:51 pm
Forum: Personal Investments
Topic: Invest in bonds vs. prepay mortgage
Replies: 168
Views: 7341

Re: Invest in bonds vs. prepay mortgage

Here is how I calculate it I place a premium on liquidity, nominally 0.5-0.75%. so therefore a comparable bond must yield after tax 0.5% or more below my mortgage rate for me to pay on debt. I also liability match the debt to it's long term equivalent. Therefore, I tend to look at the distribution y...
by mjb
Mon Dec 02, 2019 7:16 am
Forum: Investing - Theory, News & General
Topic: Average return for US stock market for the next 10-20 years to use for planning purpose
Replies: 38
Views: 3513

Re: Average return for US stock market for the next 10-20 years to use for planning purpose

So a rough approximation is stocks tend to have a 4% risk premium over the 10 year treasury yield when looking out 10 years. However, that premium has been trending downward. That puts you at between 5 and 7% Alternatively, assuming GDP growth plus 2% tends to be relatively accurate as well. With in...
by mjb
Sun Dec 01, 2019 7:18 am
Forum: Investing - Theory, News & General
Topic: Why do you hold bonds in your portfolio?
Replies: 296
Views: 22753

Re: Why do you hold bonds in your portfolio?

Rebalancing and sequence of returns risk.

Up to 20% bonds rebalanced via bands has historically performed almost the same as lower levels of bonds.

If there is a stock crash and I need cash, I can withdraw from bonds that have likely appreciated.
by mjb
Tue Nov 26, 2019 11:24 pm
Forum: Personal Finance (Not Investing)
Topic: Follow Up: Husband's Surprise Debts
Replies: 371
Views: 39056

Re: Follow Up: Husband's Surprise Debts

I understand lifestyle creep happens and it is really easy to fall into. However, your expenses (including tax) roughly match someone with a 300k/yr income while you are on a 150-200k/year income. From a pure math perspective, the best solution would be to sell your house, pay off your debts, and do...