Search found 1472 matches

by packer16
Thu Jan 12, 2023 11:34 am
Forum: Investing - Theory, News & General
Topic: Vanguards private equity firm: Harbourvest
Replies: 22
Views: 4015

Re: Vanguards private equity firm: Harbourvest

You could get similar/better returns by equally weighting the US PE firms (ARES, BX, APO & KKR) & not have to worry about the discount. Am I right in thinking you are investing then in the Asset Managers themselves (rather like owning shares in Blackrock)? Except with an associated partnership structure to pay the carried interest + other compensation to the employees of the firm *first*? In other words, you are not owning a stake in a portfolio of deals/ investee companies that the funds have invested in, but the fund manager itself? The reason being because of IRS rules (PFIC again) would make the direct holding really difficult from an individual tax perspective? If I am correct, the risk-return spectrum would be very different....
by packer16
Thu Jan 12, 2023 10:16 am
Forum: Investing - Theory, News & General
Topic: Vanguards private equity firm: Harbourvest
Replies: 22
Views: 4015

Re: Vanguards private equity firm: Harbourvest

You could get similar/better returns by equally weighting the US PE firms (ARES, BX, APO & KKR) & not have to worry about the discount.
by packer16
Fri Nov 11, 2022 10:54 am
Forum: Investing - Theory, News & General
Topic: Curious about CCFLX
Replies: 33
Views: 4647

Re: Curious about CCFLX

I am not a fan of managed futures as I see a no or very little long-term real expected return. IMO they are an imperfect hedge against stock/bond vol. I hold a few years of cash for my living expenses less income for that. Thus, I focus on income generating or cap gain type situations.

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by packer16
Thu Nov 10, 2022 1:11 pm
Forum: Investing - Theory, News & General
Topic: Curious about CCFLX
Replies: 33
Views: 4647

Re: Curious about CCFLX

The market is divided into larger players ($ARCC, $BXSL) who service private equity shops and provide primarily 1st & some 2nd lien debt support to private equity firms. These have scale & large origination platforms. There are more specialty guys like $TSLX, $OCSL & $CSWC who provide some private equity lending & some specialty lending. I know $TSLX the best as I used to work with some of the management team there. $TSLX is IMO the safest with high interest coverage ratio of 2.6x which did not decline last Q, 90%+ senior secured paper & 40% of the portfolio in special situations. I know a friend who worked with $ARCC & felt good about them also.

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by packer16
Thu Nov 10, 2022 10:06 am
Forum: Investing - Theory, News & General
Topic: Curious about CCFLX
Replies: 33
Views: 4647

Re: Curious about CCFLX

The net returns of the better underwriters (TSLX, ARCC, CSWC) show the leverage model that works vs the fund model (CCFLX), providing higher returns with modest volatility. Interesting. I'm unaware of these funds. Do you invest in them? Btw. the volatility of TSLX seems pretty brutal compared to CCLFX. https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=2&startYear=1985&firstMonth=1&endYear=2022&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&am...
by packer16
Thu Nov 10, 2022 7:38 am
Forum: Investing - Theory, News & General
Topic: Curious about CCFLX
Replies: 33
Views: 4647

Re: Curious about CCFLX

The net returns of the better underwriters (TSLX, ARCC, CSWC) show the leverage model that works vs the fund model (CCFLX), providing higher returns with modest volatility. Interesting. I'm unaware of these funds. Do you invest in them? Btw. the volatility of TSLX seems pretty brutal compared to CCLFX. https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=2&startYear=1985&firstMonth=1&endYear=2022&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&am...
by packer16
Wed Oct 26, 2022 3:25 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe Currently Recommending "Alternatives"
Replies: 146
Views: 22419

Re: Larry Swedroe Currently Recommending "Alternatives"

The one alt I likes & like even more now is Private Credit. With rising SoFR you can get low teens yields on current price plus appreciation potential of another 50% if long-term yields for this asset class normalize @ 8% which I think is reasonable.

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by packer16
Wed Oct 26, 2022 1:39 pm
Forum: Investing - Theory, News & General
Topic: Fundrise - Real Estate
Replies: 161
Views: 26570

Re: Fundrise - Real Estate

ge1 wrote: Sun Oct 23, 2022 4:25 am
nedsaid wrote: Sun Oct 23, 2022 12:40 am
packer16 wrote: Sat Oct 22, 2022 7:39 pm If you compare the returns of Fundrise as reported by Financial Samuri of 12% per year is pretty close to the 11% return of Vanguard Real Estate (VNQ) over the same period of time (2016 to 2021).

Packer
So the investors in Fundrise are picking up a 1% illiquidity premium.
That premium increased to 33% this year (Fundrise up 5%, US REITs down 28%)….
Is that gain realizable? Can you sell all of your position at 33% up? Are you gated or do you have to wait a few years to see the cash results?

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by packer16
Sat Oct 22, 2022 7:39 pm
Forum: Investing - Theory, News & General
Topic: Fundrise - Real Estate
Replies: 161
Views: 26570

Re: Fundrise - Real Estate

If you compare the returns of Fundrise as reported by Financial Samuri of 12% per year is pretty close to the 11% return of Vanguard Real Estate (VNQ) over the same period of time (2016 to 2021).

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by packer16
Sat Oct 22, 2022 4:24 pm
Forum: Investing - Theory, News & General
Topic: Fundrise - Real Estate
Replies: 161
Views: 26570

Re: Fundrise - Real Estate

Isn't comparing publicly traded REITs to privately-held interests with no liquidity like comparing apples & oranges, especially over less than a few year holding period? If you have a longer period of time it makes sense. It sounds like Fundrise is a decent option I just don't like the less than few years marketing pitch.

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by packer16
Tue Oct 11, 2022 1:53 pm
Forum: Investing - Theory, News & General
Topic: 'Bogleheads® Live' #23 podcast is out: Mike Piper on bequest planning
Replies: 8
Views: 1071

Re: 'Bogleheads® Live' #23 podcast is out: Mike Piper on bequest planning

That would be great. I would be interested in any drawbacks as it sounds like a good plan but have little practical experience in execution. Thx.

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by packer16
Mon Oct 10, 2022 10:46 am
Forum: Investing - Theory, News & General
Topic: [Is] Optimism [productive in investing?]
Replies: 39
Views: 3332

Re: [Is] Optimism [productive in investing?]

There is a reason the title of a book documenting 101 years of global investment returns is "Triumph of the Optimists".

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by packer16
Mon Oct 10, 2022 10:41 am
Forum: Investing - Theory, News & General
Topic: TIPS- real yield of 3-4%?
Replies: 23
Views: 2972

Re: TIPS- real yield of 3-4%?

... Until 2008, the world was becoming more democratic so investing these more democratic EM has a tailwind. IMO we are now in headwind situation with autocracy rising & folks looking for safe places to invest... Interesting to use the term "democratic", [off topic comments deleted by admin alex - stub left so this response makes sense] Here is the data I used: https://ourworldindata.org/democracy They have some interesting graphs & maps where you can see the trends over time also. In 2018, it looks like India was removed from the democratic camp. There are a number of ways to look at this (none is perfect) but I think this is representative. There is a also a good study that shows returns from more democratic markets is ...
by packer16
Mon Oct 10, 2022 10:16 am
Forum: Investing - Theory, News & General
Topic: TIPS- real yield of 3-4%?
Replies: 23
Views: 2972

Re: TIPS- real yield of 3-4%?

I am using the data from sources that track democracy vs. autocracy & post 2008 appears to be the flattening out phase. There probably was a delay from what was happening on the ground until it was reflected in this data.

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by packer16
Mon Oct 10, 2022 9:27 am
Forum: Investing - Theory, News & General
Topic: TIPS- real yield of 3-4%?
Replies: 23
Views: 2972

Re: TIPS- real yield of 3-4%?

One factor for higher real US rates is reasonable alternatives in the rest of the world & even the US stock market. Until 2008, the world was becoming more democratic so investing these more democratic EM has a tailwind. IMO we are now in headwind situation with autocracy rising & folks looking for safe places to invest. The US market in the late 1990s generated great historical returns so the pull for FI was lower. This situation has also changed.

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by packer16
Mon Oct 10, 2022 9:20 am
Forum: Investing - Theory, News & General
Topic: 'Bogleheads® Live' #23 podcast is out: Mike Piper on bequest planning
Replies: 8
Views: 1071

Re: 'Bogleheads® Live' #23 podcast is out: Mike Piper on bequest planning

Nice podcast. One area he did not touch on which is material for anyone doing charitable giving is the question of giving before you die to get the tax deduction vs. in your estate when you will not. You also get to see how your donations will work today. Has anyone executed a strategy of buying a SPIA for living expenses for the rest of your life & given money to charity for the rest of your life vs. after you pass?

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by packer16
Mon Oct 10, 2022 9:05 am
Forum: Investing - Theory, News & General
Topic: 3 Reasons International Investing Hasn't Paid Off.
Replies: 185
Views: 17821

Re: 3 Reasons International Investing Hasn't Paid Off.

By claiming that you don't want to blindly own an all ex-US index, you are implicitly stating that you don't believe foreign markets are highly efficient. I don't believe all foreign markets are highly efficient. It is a fact, not my belief, that not all foreign stock markets are efficient. The countries that constitute large percentages in the index should be very highly efficient. They have similar rules of law as the US, some may even be superior in that regard. China always gets discussed but it is a VERY small percentage of VXUS. China makes up 8.8% of VXUS, hardly a "very small percentage." In any event, studies show that the stock markets of numerous emerging market countries are inefficient - and emerging markets make up ...
by packer16
Mon Oct 10, 2022 8:40 am
Forum: Investing - Theory, News & General
Topic: TIPS- real yield of 3-4%?
Replies: 23
Views: 2972

Re: TIPS- real yield of 3-4%?

If you look at the long-term research on real interest rates since the 1300s (Long Term Trends in Long-term Real Rates - Rogoff et al. & Long-Term Real Rate and Safe Asset Trends, 1311-2018, Schmelzing), the current trended real rate is 0.7% with a decline rate of .0016% per year. So we are above the long-term trend today. Going to 3-4% would have to be a really big shock.

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by packer16
Fri Oct 07, 2022 5:34 pm
Forum: Investing - Theory, News & General
Topic: Update: 700 Years of Falling Interest Rates, 1311-2021
Replies: 44
Views: 6518

Re: Update: 700 Years of Falling Interest Rates, 1311-2021

One thing I find interesting is the noticeable decrease in dispersion between different countries in the post-war era. Even during the relatively peaceful period for Europe between the end of the 30-Years War and the beginning of the French Revolution and Napoleonic Wars interest rates for each state were much less correlated. Good observation. This was yet another finding in Schmelzing's original paper . Not only have real interest rates themselves been declining, but there's been a gradual, but persistent trend toward lower volatility and higher correlation of real rates in the developed world (chart below). https://i.imgur.com/Qn7wFvy.jpg NOTE: Standard deviations are 30-year rolling averages. Data source: Bank of England On the scale o...
by packer16
Thu Oct 06, 2022 9:21 am
Forum: Investing - Theory, News & General
Topic: 3 Reasons International Investing Hasn't Paid Off.
Replies: 185
Views: 17821

Re: 3 Reasons International Investing Hasn't Paid Off.

There are more than 3 reasons for the striking return divergence between US and INTL returns. There is a very long and pretty consistent history of US outperformance since 1990 when the Japanese bubble burst. The INTL outperformance relative to US for the years leading up to 1990 was largely due to the inflation of the Japan bubble, the greatest national bubble in history. That Japanese bubble dwarfed the US tech bubble of the late 1990s and the US real estate bubble of 2007. The Japanese stock market and real estate market are still 33 years later much lower now than they were in 1989. The inflation of that bubble--Japanese stocks went up 900% in 15 years and Tokyo real estate alone was worth more than all the real estate in the US in 198...
by packer16
Thu Oct 06, 2022 9:14 am
Forum: Investing - Theory, News & General
Topic: 3 Reasons International Investing Hasn't Paid Off.
Replies: 185
Views: 17821

Re: 3 Reasons International Investing Hasn't Paid Off.

I've not fully battle-tested this premise yet, but my experience with large-cap (usually very global) businesses is it doesn't tend to make a great deal of difference where they're listed. e.g. The UK's FTSE100 index has about as much (revenue) exposure to the US economy as it does the UK's. And at a stock-level, there doesn't seem to be much obvious difference in valuations, in like-for-like businesses. The most obvious difference between US, EAFE and EM indexes (imo) is sector composition. The past 40 years has really just been inflation falling, and most non-US indexes simply tend to have more exposure to cyclicals (which haven't fared as well with commodity prices and rates going down). When you look at EM vs the US, EM's been a pretty...
by packer16
Tue Oct 04, 2022 7:26 am
Forum: Investing - Theory, News & General
Topic: Closed end investment trust at a discount of >40%: looks like a great bargain, what can go wrong?
Replies: 29
Views: 3548

Re: Closed end investment trust at a discount of >40%: looks like a great bargain, what can go wrong?

I am considering investing in a Vanguard Private Equity closed end fund. It is selling at a discount greater than 40%. So I understand that I am paying 60 cents for 1 dollar. It looks like a bargain but I am not famliar with this investment vehicle. Could it stay indefinitely below NAV? Or do they tend to match NAV over time? Anything I should know about closed end funds? Here's the fund info (it's on the LSE but I am posting the question here in theory since I am more interested in understanding closed end funds in general) https://www.hl.co.uk/shares/shares-search-results/h/harbourvest-global-private-equity-ordinary Lauretta: In my experience (I'm 98) the surest way to underperform a Total Stock Market Index Fund is to try to beat it. Be...
by packer16
Sat Oct 01, 2022 9:58 am
Forum: Investing - Theory, News & General
Topic: Closed end investment trust at a discount of >40%: looks like a great bargain, what can go wrong?
Replies: 29
Views: 3548

Re: Closed end investment trust at a discount of >40%: looks like a great bargain, what can go wrong?

There are four main reasons why these funds trade at a discount: 1) management fees (in this case 2.5%/year), 2) the number of investors who want to hold what is in the fund in exact proportion is very small, 3) the inability to hedge the discount (go short the positions in the fund to arb the discount) & 4) what the discount will be when you want to sell. These can be offset by high dividends & distributions. This is also a PFIC for US investors which will add to the discount. This CEF pays no dividends so there is no offset here. IMO if you want to invest in private equity just allocate to SCV & add some modest leverage from IB if you choose or invest in one of the PE asset managers who hold positions in PE like KKR, BAM or AP...
by packer16
Sat Sep 24, 2022 11:20 pm
Forum: Investing - Theory, News & General
Topic: Diversification and haystacks
Replies: 45
Views: 4485

Re: Diversification and haystacks

I don't know if folks have seen this study which shows that since the 1970s investments in autocracies have had 50% of the returns of democracies: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3198561. This intuitively makes sense & I have heard at a CFA EM conferences that if you could avoid the nationalization countries, EM returns would be similar to DM returns. Given this result, I was surprised at the allocation to autocracy (or countries with poor disclosure - like China, India & Brazil) in Vanguard exUS ETFs & funds (25%). If you add in Japan (another poor disclosure country), the exUS ETF & funds are close to 40% exposure. The biggest issue with efficient markets in these poor disclosure/autocratic markets is m...
by packer16
Mon Sep 05, 2022 12:01 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe Currently Recommending "Alternatives"
Replies: 146
Views: 22419

Re: Larry Swedroe Currently Recommending "Alternatives"

From what I can gather a couple of the AQR funds have had a great year so far. On the other hand, LENDX, SRRIX and AVRPX are all defunct. These funds are not defunct. Quite alive and doing well this year. I own both LENDX and SRRIX. Their returns YTD are +2.7% and +12.63%. I also own QMHRX which is a higher volatility version of AVRPX. It's up 50.38% YTD. I also own another AQR fund, QRPRX which is up 16.75% this year. And to round out alternative lending, I own CCLFX which has returned 4.5% YTD. I can tell you that these returns have been quite welcome diversifiers in my portfolio this year. The only of Larry's recommended Alts that is defunct is the Variance Risk Premium fund which was quietly folded into another Stone Ridge Fund. The ot...
by packer16
Sat Sep 03, 2022 10:49 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe Currently Recommending "Alternatives"
Replies: 146
Views: 22419

Re: Larry Swedroe Currently Recommending "Alternatives"

The performance of BIP illustrates this difference vs sector funds described above which are invested in equities. There are infrastructure sector funds but the performance has been lower the BIP part of it may be leverage & the cost of that leverage may be lower for BIP than others especially for projects outside NA & the value & opportunitic nature of BIP. BIP invests in a cross section of investments that are in Brookfield institution infrastructure funds but has daily liquidity.

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by packer16
Sat Sep 03, 2022 10:31 am
Forum: Investing - Theory, News & General
Topic: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podcast
Replies: 457
Views: 39905

Re: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podca

The one premium that can be realized in a low rate environmnet is carry (buy higher yielding/CF assets financed by a lower yielding one). If we are in an environment of lower rates for longer, the carry trade can add significanlty to expected returns. Examples of how this could be implement is the levered balanced fund, levered equity or levered well underwritten private debt via BDCs. The key is to add modest amounts & not too much leverage to the higher yielding assets. It would be interesting to hear Antti's view on this. Packer I don't have a lot of knowledge about this, are there examples of how an individual investor could do this in a reasonably low cost way that has a reasonable chance of capturing any premium? I agree with Ric...
by packer16
Sat Sep 03, 2022 9:59 am
Forum: Investing - Theory, News & General
Topic: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podcast
Replies: 457
Views: 39905

Re: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podca

I agree that the building blocks of stocks & bonds are sufficient to obtain a great return on thier own. My inquiry is more of an alternative to low expected return assets (re-insurance, commodities & gold) in getting return in an environment where interest rates are low and below inflation. Modestly leveraging higher risk/return assets (like private debt, equity & RE) may be a better way to generate decent return vs diversifying into commodites, gold & re-insurnace.

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by packer16
Sat Sep 03, 2022 9:07 am
Forum: Investing - Theory, News & General
Topic: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podcast
Replies: 457
Views: 39905

Re: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podca

The one premium that can be realized in a low rate environmnet is carry (buy higher yielding/CF assets financed by a lower yielding one). If we are in an environment of lower rates for longer, the carry trade can add significanlty to expected returns. Examples of how this could be implement is the levered balanced fund, levered equity or levered well underwritten private debt via BDCs. The key is to add modest amounts & not too much leverage to the higher yielding assets. It would be interesting to hear Antti's view on this.

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by packer16
Fri Sep 02, 2022 2:58 pm
Forum: Investing - Theory, News & General
Topic: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podcast
Replies: 457
Views: 39905

Re: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podca

One topic described in the book but I don't remember if it is in the podcast is the overperformance of BB bonds vs. other types of HY bonds. This appears to be a change from conventional wisdom that investing more in equity is better than high yield. Has anyone been investing in high quality high yield bonds or loans as a result? Thx. Packer Not sure if it was this podcast or another podcast I listened to with him, but he did mention the outperformance of fallen angel bonds due to institutional managers needing to dump them when they fall out of IG. The only ticker I know for BB bonds is iShares FALN but the price history only goes back to 2016. Portfolio Visualizer shows significant outperformance vs HYG after March 2020 though which is t...
by packer16
Fri Sep 02, 2022 2:53 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe Currently Recommending "Alternatives"
Replies: 146
Views: 22419

Re: Larry Swedroe Currently Recommending "Alternatives"

The difference is surprising. Brookfield has many funds that invest in infrastructure equities (roads, bridges, towers, etc.) & the performance has been much worse than BIP. Also, the average of the 4 largest mutual funds that invest infrastructure equites has a return on 10%/yr over the past 10-yrs vs. BIP which had 17%/yr & 10% for total stock market.

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by packer16
Fri Sep 02, 2022 1:43 pm
Forum: Investing - Theory, News & General
Topic: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podcast
Replies: 457
Views: 39905

Re: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podca

One topic described in the book but I don't remember if it is in the podcast is the overperformance of BB bonds vs. other types of HY bonds. This appears to be a change from conventional wisdom that investing more in equity is better than high yield. Has anyone been investing in high quality high yield bonds or loans as a result? Thx.

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by packer16
Fri Sep 02, 2022 12:19 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe Currently Recommending "Alternatives"
Replies: 146
Views: 22419

Re: Larry Swedroe Currently Recommending "Alternatives"

You can also get exposure to infrastructure via Brookfield Infrastructure Partners (BIP) which has had pretty good performance over the years plus daily liquidity if you need it.
by packer16
Thu Sep 01, 2022 7:37 am
Forum: Investing - Theory, News & General
Topic: Curious about CCFLX
Replies: 33
Views: 4647

Re: Curious about CCFLX

From my understanding the underlying portfolios of loans in CCFLX do not have leverage. This is the same as the index that Cliffwater puts together. The one dissapointment for me the fund underperforms the unlevered index. The general idea with a BDC is the leverage for the most part offsets the fees paid plus adds a small boost to returns. If the loans are underwritten correctly, the leverage plan works. If they are poorly underwriten then there are issues.

The net returns of the better underwriters (TSLX, ARCC, CSWC) show the leverage model that works vs the fund model (CCFLX), providing higher returns with modest volatility.

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by packer16
Wed Aug 31, 2022 7:04 am
Forum: Investing - Theory, News & General
Topic: Does the S&P 500 deserve its premium valuation over small, international, and value stocks?
Replies: 54
Views: 5239

Re: Does the S&P 500 deserve its premium valuation over small, international, and value stocks?

One aspect of international diversification which I think is worth noting is the market is not good at pricing autocracy. Below is a paper which shows the returns to more democratic government stock markets is 2x more autocratic ones:

https://papers.ssrn.com/sol3/papers.cfm ... id=3198561

Therefore, when diversifying internationally, the focus should be on more democratic markets vs. more autocratic ones.

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by packer16
Wed Aug 31, 2022 6:52 am
Forum: Investing - Theory, News & General
Topic: Curious about CCFLX
Replies: 33
Views: 4647

Re: Curious about CCFLX

Public BDCs and private lenders play in the same space, lend to the same companies, and have the same business models Maybe so, but once an investment gets turned into a publicly traded security available in a secondary market I believe it gains exposure to the equity market factor and it becomes more correlated with the equity market. For example, I believe the stocks of commodity producers behave more as stocks than as commodities. Dave A commodity producer has costs in its cash flow stream that a commodity does not & thus should have equity risk as it is an option on the value of the commodity it is producing. The difference between a private debt fund and a BDC holding assets underwriten by the same team via market efficiency shoul...
by packer16
Wed Aug 31, 2022 6:47 am
Forum: Investing - Theory, News & General
Topic: Curious about CCFLX
Replies: 33
Views: 4647

Re: Curious about CCFLX

If they are economically the same, in the end if the market is efficient (which I think it is for pricing of economically equivalent products) the results should be the same or very similar. The idea that packaging and not being marked to market is a valuable service is IMO silly & if you pay for that you are paying for service with little value.

One of the disadvantages IMO is CCFLX is not levered. Well underwritten loans can modestly levered with almost no danger of default. This is what banks do all day long. Also, if you chose you can modestly lever a BDC alot cheaper than an interval fund.

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by packer16
Tue Aug 30, 2022 1:50 pm
Forum: Investing - Theory, News & General
Topic: Curious about CCFLX
Replies: 33
Views: 4647

Re: Curious about CCFLX

There are some publicly traded BDCs that can provide similar exposure that have better underwriting records than the composite CCFLX invests in, namely TSLX & CSWC. ARCC has less senior debt but has good underwriting also. IMO to invest in these outside the index mentioned above, BIZD, you need to evaluation the credit performance of the underwriters. For some there is a 10 year track record & given the maturity of most of these bonds are less than 5 years, 10 years will give you at least 2 cycles. TSLX's principals have a 20 year record with much of it at previous groups Goldman Sachs & Foothill Capital. Packer For clarification, for starters, public BDCs and private direct lending funds are not the same. So for the comments a...
by packer16
Mon Aug 29, 2022 1:17 pm
Forum: Investing - Theory, News & General
Topic: Curious about CCFLX
Replies: 33
Views: 4647

Re: Curious about CCFLX

There are some publicly traded BDCs that can provide similar exposure that have better underwriting records than the composite CCFLX invests in, namely TSLX & CSWC. ARCC has less senior debt but has good underwriting also. IMO to invest in these outside the index mentioned above, BIZD, you need to evaluation the credit performance of the underwriters. For some there is a 10 year track record & given the maturity of most of these bonds are less than 5 years, 10 years will give you at least 2 cycles. TSLX's principals have a 20 year record with much of it at previous groups Goldman Sachs & Foothill Capital.

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by packer16
Mon Aug 29, 2022 12:37 pm
Forum: Investing - Theory, News & General
Topic: Does the S&P 500 deserve its premium valuation over small, international, and value stocks?
Replies: 54
Views: 5239

Re: Does the S&P 500 deserve its premium valuation over small, international, and value stocks?

The timing of the US growth slow down & the increased risk in international markets dovetailed nicely to create to prevent an international snap back. Going forward I am not sure the trends of increased risks in non-US markets are going away soon so it may be this way for awhile.

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by packer16
Mon Aug 29, 2022 11:33 am
Forum: Investing - Theory, News & General
Topic: Does the S&P 500 deserve its premium valuation over small, international, and value stocks?
Replies: 54
Views: 5239

Re: Does the S&P 500 deserve its premium valuation over small, international, and value stocks?

In the following graph, where do you see a period of valuations dropping where the corresponding return was great? Unless you believe valuations can keep increasing in the US forever, they have to drop at some point, either because earnings catch up with the lofty valuations or investors rotate out of US stocks. The 3rd option would be that valuations are permanently elevated for the US because it is less risky, which would mean permanently lower returns going forward. https://i.postimg.cc/VNHXCmBn/pe10-may-22.jpg Hasn't the safety questions changed abit due to Russia & China. The largest allocation of non-US funds are to Europe (which has not only the issue of possible Russia incursions into Europe but also oil & gas supplies) and...
by packer16
Mon Aug 29, 2022 10:39 am
Forum: Investing - Theory, News & General
Topic: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podcast
Replies: 457
Views: 39905

Re: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podca

Did this person accurately predict returns in the past? If they know what returns are going to be, they could make a fortune on options. Seems like nothing more than an educated guess. I can get those all day long on CNBC and they all seem to be about as reliable as a coin toss. I suggest withholding the snark until you’ve heard the interview and/or read the book. Unfortunately, unless you are on a drive or walk, podcasts are inefficient and information density is rather low...the first 7-8 minutes of the podcast doesn't tell you much but the interesting parts generally need you to scrub backwards and re-listen a couple of times...while a 300 page book is a relatively big time investment. So asking for past performance, especially from som...
by packer16
Mon Aug 29, 2022 10:26 am
Forum: Investing - Theory, News & General
Topic: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podcast
Replies: 457
Views: 39905

Re: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podca

The book is great overview of the investing landscape but IMO has two missing holes which appear to provide investors decent returns. First, private (BDC-type debt). The only mention or private debt is in the alt section & includes levered loans which are different animals than private BDC-type debt. This despite the large amount of data in this sector complied by Cliffwater. I have been pleased by the returns I have received in these types of loans vis TSLX. The second is infrastructure. In table 5.1 in the book, its has the highest excess return over cash & the higher sharpe ratio of asset classes in that table. Again, I have been please by the returns I have received by investing in the largest infrastructure fund in the world B...
by packer16
Mon Aug 29, 2022 9:02 am
Forum: Investing - Theory, News & General
Topic: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podcast
Replies: 457
Views: 39905

Re: Antti Ilmanen, Ph.D, provides exceptional insight about investing amid low expected returns in this Bogleheads podca

The book is great overview of the investing landscape but IMO has two missing holes which appear to provide investors decent returns. First, private (BDC-type debt). The only mention or private debt is in the alt section & includes levered loans which are different animals than private BDC-type debt. This despite the large amount of data in this sector complied by Cliffwater. I have been pleased by the returns I have received in these types of loans vis TSLX. The second is infrastructure. In table 5.1 in the book, its has the highest excess return over cash & the higher sharpe ratio of asset classes in that table. Again, I have been please by the returns I have received by investing in the largest infrastructure fund in the world BIP.
by packer16
Mon Jun 13, 2022 1:22 pm
Forum: Investing - Theory, News & General
Topic: Factor Investing: The Next-Gen Boglehead frontier
Replies: 383
Views: 35158

Re: Factor Investing: The Next-Gen Boglehead frontier

This paper has hard questions factor investors need to ask themselves if they think factor funds will outperform in the future. No conclusions but things to reflect on: https://papers.ssrn.com/sol3/papers.cfm ... id=3779481

Packer
by packer16
Mon Jun 13, 2022 10:51 am
Forum: Investing - Theory, News & General
Topic: Factor Investing: The Next-Gen Boglehead frontier
Replies: 383
Views: 35158

Re: Factor Investing: The Next-Gen Boglehead frontier

Markets price risk. The lower valuations of value stocks reflect higher perceived risk. Risk and expected return necessarily linked. Dave They reflect the lower growth prospects amongst other factors which may or may not be related to the price. To expect by screening for low P/valuation parameter in a static fashion you are uncovering risk factors that are a function of complex securties pricing is IMO naive. Packer This is what makes markets amazing; all sorts of complex information and emotion gets consolidated into a single number, the price of a stock. Dave I agree but thinking you can get useful risk information from a static pricing multiple (which is not a valuation) is too simplistic. There is some academic research pointing this ...
by packer16
Mon Jun 13, 2022 8:55 am
Forum: Investing - Theory, News & General
Topic: Factor Investing: The Next-Gen Boglehead frontier
Replies: 383
Views: 35158

Re: Factor Investing: The Next-Gen Boglehead frontier

Random Walker wrote: Mon Jun 13, 2022 8:36 am Markets price risk. The lower valuations of value stocks reflect higher perceived risk. Risk and expected return necessarily linked.

Dave
They reflect the lower growth prospects amongst other factors which may or may not be related to the price. To expect by screening for low P/valuation parameter in a static fashion you are uncovering risk factors that are a function of complex securties pricing is IMO naive.

Packer
by packer16
Mon Jun 13, 2022 7:55 am
Forum: Investing - Theory, News & General
Topic: Factor Investing: The Next-Gen Boglehead frontier
Replies: 383
Views: 35158

Re: Factor Investing: The Next-Gen Boglehead frontier

How can you expect to make excess returns by running screens that just about everyone can do? At least active investors have a decent rationale for why their securities are not priced correctly & don't try to sell running screens is a value-added exercise. IMO the interesting places are where you have a unique or limited access to securities like directly orginated Private Debt or PE deals. If we & ETF shops can develop a screened set of securities that represent factors, there is not much excess return left. Packer For the same reason most bogleheads believe tilting to stocks will result in higher returns than tilting towards bonds. Not all stocks are equally risky. Some stocks are riskier in the same way that stocks are riskier t...
by packer16
Sun Jun 12, 2022 10:54 pm
Forum: Investing - Theory, News & General
Topic: Factor Investing: The Next-Gen Boglehead frontier
Replies: 383
Views: 35158

Re: Factor Investing: The Next-Gen Boglehead frontier

...VTI and chill has endured many very long periods of poor performance relative to a portfolio that captures many markets and risk premiums.. If you're going to say that, please give us a specific example of such a portfolio--using real funds that an ordinary investor could have bought. And show us that it was published at the start of the comparison period, not arrived at after the fact using hindsight. Here is a comparison of the stock portion of the FundAdvice Ultimate Buy-and-Hold portfolio (blue) to VTI (red) The Ultimate Buy-and-Hold is factor aware and globalized. Where are the many very long periods in which VTI underperformed? Since widespread publication of sample factor portfolios 1997-1998 or so, there's been one period in whi...
by packer16
Sun Jun 12, 2022 4:25 pm
Forum: Investing - Theory, News & General
Topic: Factor Investing: The Next-Gen Boglehead frontier
Replies: 383
Views: 35158

Re: Factor Investing: The Next-Gen Boglehead frontier

How can you expect to make excess returns by running screens that just about everyone can do? At least active investors have a decent rationale for why their securities are not priced correctly & don't try to sell running screens is a value-added exercise. IMO the interesting places are where you have a unique or limited access to securities like directly orginated Private Debt or PE deals. If we & ETF shops can develop a screened set of securities that represent factors, there is not much excess return left.

Packer