Search found 7959 matches

by grok87
Mon Jun 18, 2018 3:03 pm
Forum: Investing - Theory, News & General
Topic: Indiv. REITs in taxable because of new tax law? Aargh!
Replies: 8
Views: 1034

Re: Indiv. REITs in taxable because of new tax law? Aargh!

I don't think this suddenly makes holding individual REITs in taxable accounts the optimal decision for everyone. There are a lot of factors at play such as marginal tax rates, asset allocation, interaction with taxable and tax-deferred capacity, tax rate in retirement etc. Even if comparison is ta...
by grok87
Mon Jun 18, 2018 1:03 pm
Forum: Investing - Theory, News & General
Topic: Indiv. REITs in taxable because of new tax law? Aargh!
Replies: 8
Views: 1034

Re: Indiv. REITs in taxable because of new tax law? Aargh!

+1 on running the numbers. Does this change suddenly make REIT's tax-efficient, or just less tax-inefficient than they used to be? Well looking at the top marginal rate of 37% I think that becomes 29.6%. Still higher than 20% for non-reit qualified dividends but not by much. And also if you hold re...
by grok87
Sun Jun 17, 2018 7:46 pm
Forum: Investing - Theory, News & General
Topic: Indiv. REITs in taxable because of new tax law? Aargh!
Replies: 8
Views: 1034

Indiv. REITs in taxable because of new tax law? Aargh!

Indiv. REITs in taxable because of new tax law? Aargh! So apparently with the new tax law it is now best for most folks to hold individual REITs in taxable accounts rather than a REIT fund in tax sheltered accounts. See for example this article: "Sell your REIT fund, buy the stocks" https://www.forb...
by grok87
Sun Jun 17, 2018 2:55 pm
Forum: Investing - Theory, News & General
Topic: Very confused with the current market
Replies: 73
Views: 5391

Re: Very confused with the current market

capcase wrote:
Sun Jun 17, 2018 2:34 pm
- It has been history higher and higher.
- the fundamental law says it will recycle every 10 years
- I had been on cash for 10 months

Please don't tell me I should not time the market.

What's going wrong?
don't time the market! keep calm and boglehead on.
by grok87
Sat Jun 16, 2018 7:36 pm
Forum: Investing - Theory, News & General
Topic: Mechanisms for disappearance of factor premia -- how does it work for momentum?
Replies: 14
Views: 731

Re: Mechanisms for disappearance of factor premia -- how does it work for momentum?

First of all WHAT momentum premium? Here is the Ken French data for the momentum factor by year with CAGRs for periods ending in 2017 shown in the last column. year return cagr through 2017 1988 -5.2% 2.1% 30 yr 1989 27.9% 2.3% 1990 17.6% 1.5% 1991 14.7% 0.9% 1992 3.2% 0.5% 1993 23.7% 0.3% 25 yr 199...
by grok87
Sat Jun 16, 2018 10:34 am
Forum: Investing - Help with Personal Investments
Topic: Vanguard Managed Payout Fund
Replies: 29
Views: 2361

Re: Vanguard Managed Payout Fund

The "auto-pilot" features of this fund are nice. It's one less thing I have to worry about or discuss helping older family manage their money. Most brokers or mutual fund companies will arrange to make periodic fixed withdrawals from a holding. I don't think you have to buy a quirky fund to do that...
by grok87
Sat Jun 16, 2018 10:34 am
Forum: Investing - Theory, News & General
Topic: Schwab's Securities Lending Fully Paid (SLFP) program
Replies: 15
Views: 945

Re: Schwab's Securities Lending Fully Paid (SLFP) program

100% collateral is a bad deal. Institutional players would get overcollateralized at say 102%-105% I googled this. One PDF said they give you "at least "100% collateral. Another said it was adjusted daily to be 102%. Quoted from their document: The amount of cash collateral is adjusted daily to 102...
by grok87
Sat Jun 16, 2018 7:43 am
Forum: Investing - Help with Personal Investments
Topic: Vanguard Managed Payout Fund
Replies: 29
Views: 2361

Re: Vanguard Managed Payout Fund

If you look at the history of the fund, they frequently change the portfolio make-up because of what they see as market inefficiencies, which in practice can also be seen as performance chasing and market timing. So you'd never know that what you bought wouldn't suddenly change, and you have to dea...
by grok87
Sat Jun 16, 2018 7:18 am
Forum: Investing - Help with Personal Investments
Topic: Vanguard Managed Payout Fund
Replies: 29
Views: 2361

Re: Vanguard Managed Payout Fund

You won't find many fans here, but I bought about $100,000 worth of VPGDX. I like it. Don't go by the long term track record either. It's a different fund than what was launched 10 years ago. I have been investing my whole life but as I get older I want to spend less time paying attention to it. So...
by grok87
Fri Jun 15, 2018 5:00 pm
Forum: Investing - Theory, News & General
Topic: Are Bogleheads smarter than the bond market?
Replies: 36
Views: 3313

Re: Are Bogleheads smarter than the bond market?

Not just recently. This conversation has been going on for at least 10 years. Maybe 15. Dr. Bernstein is right about the risk of anything but shorter term bonds. But he's been wrong about the market. So far. He says "keep your safe money safe" and "take your risk on the equity side", no on the bond...
by grok87
Fri Jun 15, 2018 9:43 am
Forum: Investing - Help with Personal Investments
Topic: Vanguard Managed Payout Fund
Replies: 29
Views: 2361

Re: Vanguard Managed Payout Fund

LXEX55 wrote:
Fri Jun 15, 2018 9:40 am
But just to clarify, one final question: I can get out of this fund anytime I want, right? In other words, if I don't like the payouts or reduction in principal, I can just switch the funds to an index fund or something.....correctomundo?
Yep
by grok87
Fri Jun 15, 2018 9:40 am
Forum: Investing - Theory, News & General
Topic: 30 yr tips auction: june 21: 1.0% yield?
Replies: 21
Views: 2137

Re: 30 yr tips auction: june 21: 1.0% yield?

Wow things move fast.
Secondary market yield now at 0.90%

I think it would be prudent to allow for the possibility that the auction rate might drop to 0.85%

So using #Cruncher’s handy table you would want to have at least $1060 available per bond.
by grok87
Fri Jun 15, 2018 7:33 am
Forum: Investing - Theory, News & General
Topic: Schwab's Securities Lending Fully Paid (SLFP) program
Replies: 15
Views: 945

Re: Schwab's Securities Lending Fully Paid (SLFP) program

100% collateral is a bad deal. Institutional players would get overcollateralized at say 102%-105%
by grok87
Fri Jun 15, 2018 7:02 am
Forum: Investing - Help with Personal Investments
Topic: Vanguard Managed Payout Fund
Replies: 29
Views: 2361

Re: Vanguard Managed Payout Fund

Agree with the comments above Perhaps worth posting the funds current asset allocation. Vanguard seems to monkey with this a lot. Currently they have raised the international stocks and commodities. Vanguard Total International Stock Index Fund Investor Shares 24.80% Vanguard Total Bond Market II In...
by grok87
Fri Jun 15, 2018 4:37 am
Forum: Investing - Theory, News & General
Topic: Schwab's Securities Lending Fully Paid (SLFP) program
Replies: 15
Views: 945

Re: Schwab's Securities Lending Fully Paid (SLFP) program

Schwab is offering a monthly income opportunity through their Securities Lending Fully Paid (SLFP) program. What are the risks? Not sure of the specifics of this program. Hee is a vanguard paper https://personal.vanguard.com/pdf/ISGSL.pdf Aig has a lot of losses from securities lending during the g...
by grok87
Thu Jun 14, 2018 7:53 pm
Forum: Investing - Theory, News & General
Topic: 30 yr tips auction: june 21: 1.0% yield?
Replies: 21
Views: 2137

Re: 30 yr tips auction: june 21: 1.0% yield?

So index factor is 1.01575 and accrued interest is $3.76 per $1000. So if the bond auctions at par one will need $1019.51 per bond. Here is what the total cost would be for other auction yields: Cost per Yield Price $1,000 Face 0.83% 104.457 1,064.78 0.84% 104.189 1,062.06 0.85% 103.921 1,059.34 0....
by grok87
Thu Jun 14, 2018 5:12 pm
Forum: Investing - Theory, News & General
Topic: 30 yr tips auction: june 21: 1.0% yield?
Replies: 21
Views: 2137

Re: 30 yr tips auction: june 21: 1.0% yield?

Thanks for the announcement.

So index factor is 1.01575 and accrued interest is $3.76 per $1000. So if the bond auctions at par one will need $1019.51 per bond.

Today’s secondary market yield is 0.93% and price is 101.8. If it auctions at today’s levels one will need $1037.79 per bond.
by grok87
Thu Jun 14, 2018 7:32 am
Forum: Investing - Theory, News & General
Topic: 30 yr tips auction: june 21: 1.0% yield?
Replies: 21
Views: 2137

Re: 30 yr tips auction: june 21: 1.0% yield?

30 year tips auction will be announced today. You should be able to start placing your orders today. Current secondary market yield is at 0.93% so 1.0% for the auction may be a bit of a stretch.
Cheers,
Grok
by grok87
Wed Jun 13, 2018 7:47 am
Forum: Personal Consumer Issues
Topic: What To Do About 2001 Honda Odyssey With No AIr
Replies: 16
Views: 1321

Re: What To Do About 2001 Honda Odyssey With No AIr

I have a similar odyssey. They are indestructible. I plan to keep it till it dies
by grok87
Tue Jun 12, 2018 9:43 am
Forum: Investing - Help with Personal Investments
Topic: Annuity/Pension subsitutes for portfolio
Replies: 31
Views: 2512

Re: Annuity/Pension subsitutes for portfolio

There is no investment that behaves like a pension, certainly not that Vanguard managed payout fund. TIPS ladders have their point but are not a pension, in particular lacking the insurance feature of pooled longevity risk. The equivalent to a pension is an SPIA, which is an insurance product and n...
by grok87
Tue Jun 12, 2018 6:05 am
Forum: Investing - Help with Personal Investments
Topic: Annuity/Pension subsitutes for portfolio
Replies: 31
Views: 2512

Re: Annuity/Pension subsitutes for portfolio

The problem with annuities is that they are not federally guaranteed. In fact they are not strictly speaking even state guaranteed. They are backed by state guarantee funds that will be funded after the fact by assessments on other insurance companies operating in the state. And even that coverGe i...
by grok87
Sun Jun 10, 2018 8:36 pm
Forum: Investing - Help with Personal Investments
Topic: Annuity/Pension subsitutes for portfolio
Replies: 31
Views: 2512

Re: Annuity/Pension subsitutes for portfolio

There's a scenario in which TIPS fall behind. If they are the main asset in your portfolio it could be a problem. Example: If the US debt becomes unpayable through tax receipts, then default or reduced payments become increasingly possible. In one "reduced payment" scenario, there is inflation, but...
by grok87
Sun Jun 10, 2018 6:47 pm
Forum: Investing - Theory, News & General
Topic: Why large cap if small cap is better?
Replies: 20
Views: 1508

Re: Why large cap if small cap is better?

Hi. As has been posted, there are years when large caps outperform. Over the long run, small caps have done better, and as much as I hate to say it because I really love Vanguard, ishares small cap has largely outperformed Vanguard's small cap etf because Vanguard has a broader holding and seems to...
by grok87
Sun Jun 10, 2018 5:50 pm
Forum: Investing - Help with Personal Investments
Topic: Annuity/Pension subsitutes for portfolio
Replies: 31
Views: 2512

Re: Annuity/Pension subsitutes for portfolio

See this thread https://www.bogleheads.org/forum/viewtopic.php?f=10&t=245377 This is awesome Grok87, thank you so much! I like the model and the reasoning-- a model is such a helpful place to start! And when it's laid out so well, it's easy to see where to tweak it for my own circumstances. Thanks ...
by grok87
Sun Jun 10, 2018 1:05 pm
Forum: Investing - Help with Personal Investments
Topic: Annuity/Pension subsitutes for portfolio
Replies: 31
Views: 2512

Re: Annuity/Pension subsitutes for portfolio

So i’ll Take a position a little different than retiredjg. :) The problem with annuities is that they are not federally guaranteed. In fact they are not strictly speaking even state guaranteed. They are backed by state guarantee funds that will be funded after the fact by assessments on other insura...
by grok87
Sun Jun 10, 2018 5:57 am
Forum: Personal Finance (Not Investing)
Topic: Are you including SS in your planning model? Are the benefits really that high?
Replies: 148
Views: 11021

Re: Are you including SS in your planning model? Are the benefits really that high?

Medicare is available if one is eligible for Social Security. The amount that one receives from Social Security depends on one's work record. On the other hand, one can retire at 35 and still receive full Medicare benefits if one has worked for 40 quarters. Whatever. i think below age 65 one is onl...
by grok87
Sat Jun 09, 2018 7:49 am
Forum: Personal Finance (Not Investing)
Topic: Are you including SS in your planning model? Are the benefits really that high?
Replies: 148
Views: 11021

Re: Are you including SS in your planning model? Are the benefits really that high?

I have not used social security in any retirement planing model since I began modeling back in my 20s. Just today I tried an SSA calculator to estimate my benefits. I told it I would stop earning at 54 and entered my yearly earnings up to this year. I'm 44. The result was a monthly benefit of $1600...
by grok87
Sat Jun 09, 2018 6:59 am
Forum: Investing - Theory, News & General
Topic: I don’t understand the concept of cost of equity
Replies: 5
Views: 574

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

Let’s simplify. How much return you would demand from an investment depends on the riskiness of that investment. Higher risk investments (on average) must produce higher returns (on average), otherwise no one would invest in them. A company’s equity is riskier than its debt, by definition, because ...
by grok87
Sat Jun 09, 2018 6:57 am
Forum: Investing - Theory, News & General
Topic: I don’t understand the concept of cost of equity
Replies: 5
Views: 574

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

I know the textbook definition of cost of equity. I know how to calculate via the dividend discount model and CAPM but understanding the concept of cost of equity seems much trickier than understanding the cost of debt. Costs of debt seems easy to understand; you have to pay interest of the debt th...
by grok87
Sat Jun 09, 2018 5:54 am
Forum: Investing - Theory, News & General
Topic: 30 yr tips auction: june 21: 1.0% yield?
Replies: 21
Views: 2137

Re: 30 yr tips auction: june 21: 1.0% yield?

What will Guv have to pay when debt raches 100% of GDP in 2028? Japan's is 253% and they have zero nominal rates, much less zero real rates. Different people anchor onto different periods to identify what they think is "normal". Looking back at the 80s and 90s, I kind of think that those rates were...
by grok87
Fri Jun 08, 2018 6:11 am
Forum: Investing - Theory, News & General
Topic: 30 yr tips auction: june 21: 1.0% yield?
Replies: 21
Views: 2137

Re: 30 yr tips auction: june 21: 1.0% yield?

Secondary market yield now at 0.93% so 1% at the auction is looking less likely...

If only I had bought more at the February auction to scoop up those nice 1% real yields...

Oh wait! I did!

viewtopic.php?f=10&t=240938

:)
by grok87
Fri Jun 08, 2018 6:08 am
Forum: Investing - Theory, News & General
Topic: 30 yr tips auction: june 21: 1.0% yield?
Replies: 21
Views: 2137

Re: 30 yr tips auction: june 21: 1.0% yield?

Yup. 2-3% seems far away especially when european trips yield are close to zero or negative.
by grok87
Thu Jun 07, 2018 12:17 pm
Forum: Investing - Theory, News & General
Topic: Rising Interest Rate Strategy
Replies: 35
Views: 4005

Re: Rising Interest Rate Strategy

30 year tips
by grok87
Thu Jun 07, 2018 10:23 am
Forum: Investing - Theory, News & General
Topic: 30 yr tips auction: june 21: 1.0% yield?
Replies: 21
Views: 2137

Re: 30 yr tips auction: june 21: 1.0% yield?

I feel your pain. Long term interest rates seem low by historical standards. But the strategy you propose feels like market timing to me for an investor such as me who is interested in matching long term retirement liabilities. And whenever I have tried to do any sort of market timing on say the equ...
by grok87
Thu Jun 07, 2018 10:18 am
Forum: Investing - Theory, News & General
Topic: Bloomberg commodities index still in contango
Replies: 62
Views: 5286

Re: Bloomberg commodities index still in contango

June report is out not. https://data.bloomberglp.com/promo/sites/12/208558_BCOM-June2018Outlook.pdf Not much change from last month. Broad market in contango of -2%. Grok : And if at some point you did decide to put money into commodities exactly which funds would you choose ? Many have either high...
by grok87
Thu Jun 07, 2018 5:28 am
Forum: Investing - Theory, News & General
Topic: 30 yr tips auction: june 21: 1.0% yield?
Replies: 21
Views: 2137

30 yr tips auction: june 21: 1.0% yield?

On June 14th the next 30 year tips auction will be announced with the auction itself on June 21st. You can start placing your orders on June 14th. I plan to participate for my normal thrice annual amount as part of my liability matching strategy to fund part of my retirement portfolio. Any one else ...
by grok87
Tue Jun 05, 2018 4:56 pm
Forum: Investing - Theory, News & General
Topic: WSJ:Social Security Expected to Dip Into Its Reserves This Year
Replies: 61
Views: 3009

Re: WSJ:Social Security Expected to Dip Into Its Reserves This Year

I’m hoping this thread doesn’t get locked and we can perhaps simply discuss the projected payout of social securiTy under current law. To restate, for the old age and survivors insurance benefit, ie what most people think of as social securiTy, under current law benefits are projected to be paid in ...
by grok87
Tue Jun 05, 2018 4:17 pm
Forum: Investing - Theory, News & General
Topic: WSJ:Social Security Expected to Dip Into Its Reserves This Year
Replies: 61
Views: 3009

Re: WSJ:Social Security Expected to Dip Into Its Reserves This Year

That's not a surprise... SS has been expected to start dipping into reserves this year, and continue doing so until they are depleted around 2034 at which time it will start being able to pay only 75% of obligations unless some changes are made before then. I don't rely on SS in my retirement plann...
by grok87
Tue Jun 05, 2018 12:58 pm
Forum: Investing - Theory, News & General
Topic: Bloomberg commodities index still in contango
Replies: 62
Views: 5286

Re: Bloomberg commodities index still in contango

June report is out not.
https://data.bloomberglp.com/promo/site ... utlook.pdf

Not much change from last month. Broad market in contango of -2%.
by grok87
Sun Jun 03, 2018 3:42 pm
Forum: Investing - Theory, News & General
Topic: PenFed 3% 5 year certificates are back.
Replies: 15
Views: 2230

Re: PenFed 3% 5 year certificates are back.

The rate is of course less exciting but also the early withdrawal penalty is higher making the comparison to treasuries less favorable. For those in high tax states investing in taxable accounts the fact that treasuries aren’t subject to state tax bridges the small gap in yield. The worse early wit...
by grok87
Sun Jun 03, 2018 9:32 am
Forum: Investing - Theory, News & General
Topic: PenFed 3% 5 year certificates are back.
Replies: 15
Views: 2230

Re: PenFed 3% 5 year certificates are back.

I don't think this is very attractive, since the 10 year Treasury note rate is already around 3% and likely to go higher. Also, here is the early withdrawal penalty from the certificate application: 2) Certificates Having a Term Greater Than Six Months. a) If redeemed within the first year, all div...
by grok87
Fri Jun 01, 2018 4:55 pm
Forum: Investing - Help with Personal Investments
Topic: Selling municipal bonds
Replies: 9
Views: 1314

Re: Selling municipal bonds

There is a website called Emma where you can type in the cusip for the bond and see if there has been any trading.

https://emma.msrb.org

Muni bonds don’t trade a lot and Sometimes the info is a little hard to undeRstand, but if you give it a try we can walk you through how to interpret it.
by grok87
Wed May 30, 2018 4:44 pm
Forum: Investing - Help with Personal Investments
Topic: Selling municipal bonds
Replies: 9
Views: 1314

Re: Selling municipal bonds

What prices are the bonds currently marked at? Above or below 100? If They are below 100 you may have more trouble selling them as folks are generally reluctant to buy there since the discount from par is generally federally taxable.
by grok87
Tue May 29, 2018 6:13 am
Forum: Investing - Theory, News & General
Topic: 30 yr tips auction 2/15: 1.0% yield?
Replies: 174
Views: 16880

Re: 30 yr tips auction 2/15: 1.0% yield?

Now at 0.85% Now back up to 1.01% https://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield yep and now at 0.89%. so far my bet to double up at the february auction to snag those tasty 1.0% yields is looking good. We'll see where we are in a few we...
by grok87
Fri May 25, 2018 3:56 am
Forum: Investing - Theory, News & General
Topic: Theory: Total World Index a Sure Fire Win [VT/VTWSX]
Replies: 155
Views: 12734

Re: Theory: Total World Index a Sure Fire Win [VT/VTWSX]

Adding European or Japanese stocks to U.S. stocks you add currency risk, but probably not much if any political risk. Adding South America, China, India, and other emerging markets drastically increases the exposure to black swans caused by war, violent political changes, and government confiscatio...
by grok87
Thu May 24, 2018 9:59 pm
Forum: Investing - Help with Personal Investments
Topic: What would you do: TIAA traditional vs. TREA?
Replies: 39
Views: 1857

Re: What would you do: TIAA traditional vs. TREA?

I am in my mid 20s and have a large portfolio for my age (>0.5 million, mostly in taxable accounts) due to an extremely generous relative. In my current job I have access to a 403(b) with TIAA. The most appealing options there are TIAA traditional (3% guaranteed) and TREA (TIAA real estate). I am c...
by grok87
Tue May 22, 2018 7:09 pm
Forum: Investing - Theory, News & General
Topic: Theory: Total World Index a Sure Fire Win [VT/VTWSX]
Replies: 155
Views: 12734

Re: Theory: Total World Index a Sure Fire Win [VT/VTWSX]

This is a sort of a trick question and I do not want to hide the fact that it's a trick question... but I am going to be tricky enough not to state what I think the explanation is. According to the Credit Suisse Global Returns Yearbook, from 1900 through 2017 (i.e. over a century): The total real r...
by grok87
Tue May 22, 2018 6:29 pm
Forum: Investing - Theory, News & General
Topic: Theory: Total World Index a Sure Fire Win [VT/VTWSX]
Replies: 155
Views: 12734

Re: Theory: Total World Index a Sure Fire Win [VT/VTWSX]

The total real return on a total world stock portfolio, including both US and ex-US stock markets, would have been 5.2%/year. The total real return on a US-only stock portfolio would have been 6.5%/year. If the Bogleheads forum had existed in 1900, why couldn't you have written exactly the same thi...