Search found 1785 matches

by asif408
Tue Oct 15, 2019 5:38 am
Forum: Investing - Theory, News & General
Topic: Isn't lack of transparency in China a huge risk for international stock index?
Replies: 60
Views: 4500

Re: Isn't lack of transparency in China a huge risk for international stock index?

The nice thing in that China is only 3% of VT if that concerns you. I'd be more concerned about US fraud since they makes up 55% of VT. Sure China is corrupt but let's not pretend that Worldcom and Enron didn't exist or that some future Worldcom or Enron types currently exist in the US stock market.
by asif408
Mon Oct 14, 2019 10:24 am
Forum: Investing - Theory, News & General
Topic: Adjusting AA based on equity risk premium
Replies: 51
Views: 2620

Re: Adjusting AA based on equity risk premium

I'll do you a favor before the anti market timers show up Adjusting your AA based on the ERP is entirely rational , sensible and logical. In fact, it IS one of the inputs to determine your ideal risk exposure in the context of mean-variance utility optimization. That people don't do it is a demonst...
by asif408
Mon Oct 14, 2019 8:14 am
Forum: Investing - Theory, News & General
Topic: At what point would Bonds be considered a bubble or 'speculative asset'?
Replies: 51
Views: 4661

Re: At what point would Bonds be considered a bubble or 'speculative asset'?

To me, it's as simple as this: if I can stick my money under a mattress and come out ahead of investing in a bond, then bonds are in a bubble. That seems to be the case in much of Europe, less so here in the US. The crazy thing in Europe is that there are junk bonds yielding less than zero, yielding...
by asif408
Fri Oct 11, 2019 12:35 pm
Forum: Investing - Theory, News & General
Topic: Is home bias really biased?
Replies: 12
Views: 945

Re: Is home bias really biased?

So I will flip this question and ask why not international? So the S&P is 43% international. What does this mean? It mean that the S&P is dominated by large multinational companies. If you look at international indexes you are going to see the same thing - dominated by large multinational companies...
by asif408
Thu Oct 10, 2019 12:54 pm
Forum: Personal Investments
Topic: Diversify my portfolio further with factors and sectors
Replies: 71
Views: 3376

Re: Diversify my portfolio further with factors and sectors

A portfolio that is susceptible to other risks aside from those of US large capitalization companies. That's why I'm thinking of stuff like timber investing, utilities, small value, etc. Definitely not more portfolio efficient since I know the market portfolio is already efficient. I'm looking for ...
by asif408
Wed Oct 09, 2019 2:54 pm
Forum: Investing - Theory, News & General
Topic: INTERNATIONALS 20% of Equities or 20% of Portfolio?
Replies: 57
Views: 3327

Re: INTERNATIONALS 20% of Equities or 20% of Portfolio?

Now the efficient frontier likely says international provides almost no benefit because of the last decade of US outperformance. Not if the frontier is competently constructed. Naively extrapolating the most recent 10 years into the future would be the kind of rookie mistake that is easily avoided....
by asif408
Wed Oct 09, 2019 2:22 pm
Forum: Investing - Theory, News & General
Topic: INTERNATIONALS 20% of Equities or 20% of Portfolio?
Replies: 57
Views: 3327

Re: INTERNATIONALS 20% of Equities or 20% of Portfolio?

I've got an international equity allocation of 40% precisely because that's what the experts at Vanguard, Fidelity, etc. recommend, and I'm in no position to second guess them. But I wonder: Is there any evidence that suggests a smaller allocation to international is optimal for the typical investo...
by asif408
Wed Oct 09, 2019 12:16 pm
Forum: Investing - Theory, News & General
Topic: INTERNATIONALS 20% of Equities or 20% of Portfolio?
Replies: 57
Views: 3327

Re: INTERNATIONALS 20% of Equities or 20% of Portfolio?

Info has been posted on this board before, and I'm sure someone saved it and can repost it here, showing that the sweet spot for international equities for US investors is indeed closer to 20% than the total world market cap of around 44%. Depends on the time frame used. The one on this site stoppe...
by asif408
Wed Oct 09, 2019 10:33 am
Forum: Personal Investments
Topic: Where to allocate large stock sale proceeds given current allocation
Replies: 7
Views: 365

Re: Where to allocate large stock sale proceeds given current allocation

I'd probably just allocate to match whatever your chosen allocation is. So if you want to be 90/10 stocks/bonds, with say 20% in international, contribute enough to each to match that allocation.

If you don't have a desired AA, then it's probably good to come up with one.
by asif408
Wed Oct 09, 2019 8:21 am
Forum: Investing - Theory, News & General
Topic: INTERNATIONALS 20% of Equities or 20% of Portfolio?
Replies: 57
Views: 3327

Re: INTERNATIONALS 20% of Equities or 20% of Portfolio?

Imagine you have a loved one (friend of relative) with a persistent cough, chest pains, and shortness of breath so you encourage you to visit the doctor. At then end of the visit, you ask them how it went. "Well", they say, "I told the doctor that I've been smoking 2 packs of cigarettes a day and t...
by asif408
Tue Oct 08, 2019 9:07 am
Forum: Investing - Theory, News & General
Topic: Bogleheads at Schwab - will you start buying Vanguard ETFs instead?
Replies: 16
Views: 1647

Re: Bogleheads at Schwab - will you start buying Vanguard ETFs instead?

Also, does it matter in any way that VTI’s AUM is so much larger than SCHB? Does it make VTI a bit safer or less likely to face issues? IMO, no. Anything with several billion in assets that owns a broad segment of the world market can generally be considered unlikely to face issues to be concerned ...
by asif408
Fri Oct 04, 2019 3:26 pm
Forum: Investing - Theory, News & General
Topic: Know when to hold them and when to fold them......
Replies: 148
Views: 13158

Re: Know when to hold them and when to fold them......

IIRC, I started out 70/30 US/Int'l before I knew anything based on the advice of this board, since I was a bit of a newbie back then. That was back around 2013/2014. Developed ex-US and emerging markets have underperformed US stocks every year since 2013 except for 2017, so like others I have been d...
by asif408
Fri Oct 04, 2019 8:48 am
Forum: Investing - Theory, News & General
Topic: 'Stay the course' with international stock but give up on value?
Replies: 101
Views: 6525

Re: 'Stay the course' with international stock but give up on value?

We also don't have anyone arguing that one should eschew US stocks altogether (or even go beyond market weight in international). If we did, that would be interesting. I pretty much have held an extremely overweight international position since 2016 (<10% US stocks), but wouldn't dare argue for it,...
by asif408
Thu Oct 03, 2019 10:57 am
Forum: Investing - Theory, News & General
Topic: 'Stay the course' with international stock but give up on value?
Replies: 101
Views: 6525

Re: 'Stay the course' with international stock but give up on value?

My observation is that, at least on this board, sentiment is very low with regards to international investing (maybe nearing a nadir?), and not far behind with value. I think most of the frequent posters here advocate for some international diversification, but not necessarily a value tilt. So your ...
by asif408
Wed Oct 02, 2019 10:05 am
Forum: Personal Investments
Topic: Emerging Markets Value Funds?
Replies: 14
Views: 1072

Re: Emerging Markets Value Funds?

There are no really true EM value funds that I know of that are easy to access, though a couple are good approximations (like FNDE mentioned above). FNDE is about the cheapest at 0.39% ER. You could also consider PXH, which has an ER of 0.5%. There are some others, but their track record is shorter ...
by asif408
Wed Oct 02, 2019 9:32 am
Forum: Investing - Theory, News & General
Topic: If you use Vanguard (Brokerage), why do you stay?
Replies: 58
Views: 6368

Re: If you use Vanguard (Brokerage), why do you stay?

What the other companies are offering with free ETF trades for my purposes is exactly the same as what I already have with Vanguard. Personally, I don't do much with my accounts as far as trading, and my needs are low with brokerage accounts, so for me I started with them and see no compelling reaso...
by asif408
Mon Sep 30, 2019 2:36 pm
Forum: Personal Investments
Topic: VTIAX International fund - should I give up on it?
Replies: 297
Views: 25855

Re: VTIAX International fund - should I give up on it?

Thanks, this is helpful. I figured I was probably using the wrong terms. Basically, I was looking to see if there were sustained times VTIAX was "up" when VTSAX was "down". Answer is not really, but VTIAX vs VTSAX only takes us back to 2011. If we extend to Investor Class shares and pick up the 200...
by asif408
Mon Sep 30, 2019 1:00 pm
Forum: Personal Investments
Topic: VTIAX International fund - should I give up on it?
Replies: 297
Views: 25855

Re: VTIAX International fund - should I give up on it?

Sorry if this is a dumb question, but I would think that if international provided diversification benefits we'd see it in the historical performance, no? Instead when I look at a chart of VTIAX and VTSAX across the life of both, they seem largely in sync and correlated to me. What am I missing? Co...
by asif408
Fri Sep 27, 2019 2:42 pm
Forum: Investing - Theory, News & General
Topic: Bonds returns are on par with Stocks?
Replies: 98
Views: 5621

Re: Bonds returns are on par with Stocks?

The main flaw I see is that you can selectively choose starting and ending dates to make any point you like in investing and make a good headline for an article. For example: 1976-2011: Gold is a much better investment than stocks over the long run 1980-2019: Gold is a terrible investment that can h...
by asif408
Fri Sep 27, 2019 2:07 pm
Forum: Personal Investments
Topic: VTIAX International fund - should I give up on it?
Replies: 297
Views: 25855

Re: VTIAX International fund - should I give up on it?

We should already be well into this decade of Int. out performance, long predicted by Vanguard and others. The under performance vs. US so far will logically have to be compensated by tremendous out performance in the next few years. Aside from an eventual weakening the US Dollar, I don't see what ...
by asif408
Thu Sep 26, 2019 3:15 pm
Forum: Investing - Theory, News & General
Topic: Buy Low, Sell High... Define High
Replies: 10
Views: 1054

Re: Buy Low, Sell High... Define High

Personally, I like to keep it simple. The reason is that rebalancing, no matter how you do it, and particularly for a buy and hold investor, likely won't make much difference to your overall long term returns. I basically check once a year and if there is not much disparity in returns I do nothing. ...
by asif408
Thu Sep 26, 2019 12:47 pm
Forum: Personal Investments
Topic: Where to safely park/invest shorter term cash to maximize returns - a *little* risk is OK
Replies: 27
Views: 3164

Re: Where to safely park/invest shorter term cash to maximize returns - a *little* risk is OK

About the best you can do is put 80-90% in MMF/high-yield savings/short term bond fund, and put 10-20% in stocks. During the last 2 bear markets most variations of that allocation lost 4-5% max during the worst periods and didn't lag an all bond portfolio by much, and over the last 25 years it has b...
by asif408
Wed Sep 25, 2019 1:34 pm
Forum: Personal Investments
Topic: VTIAX International fund - should I give up on it?
Replies: 297
Views: 25855

Re: VTIAX International fund - should I give up on it?

Also, a diversified portfolio can be expected to have lower volatility as well as slightly higher returns. So the market lows that are coming someday, are likely to test me less severely. That was not the experience in 2008/2009. Very true. That's why I only own long-term Treasuries. Better returns...
by asif408
Tue Sep 24, 2019 8:09 am
Forum: Personal Investments
Topic: VTIAX International fund - should I give up on it?
Replies: 297
Views: 25855

Re: VTIAX International fund - should I give up on it?

But in a "business-as-usual" future, I'm not particularly worried about either side underperforming for long -- they'll just trade places for 5-10 year periods of outperformance as major indices usually do, and the volatility on each side canceling each other out will make me better off than holdin...
by asif408
Mon Sep 23, 2019 4:01 pm
Forum: Personal Investments
Topic: VTIAX International fund - should I give up on it?
Replies: 297
Views: 25855

Re: VTIAX International fund - should I give up on it?

This topic of international vs. domestic is just so hard to discuss. We're all biased, we all seek confirmation bias about preconceived ideas (even when being keenly self-aware of such pitfall), we're all shaped by our personal background and past experiences, and we discuss until we're blue on the...
by asif408
Fri Sep 20, 2019 12:25 pm
Forum: Personal Investments
Topic: VTIAX International fund - should I give up on it?
Replies: 297
Views: 25855

Re: VTIAX International fund - should I give up on it?

Is this cherry picking a starting point? What does this tell us? Don’t invest in international? I think it’s best to diversify outside US because you don’t know what the next 30 years will be like. It is cherry picking no doubt... but the only way to make sense of it is to compare the same sets of ...
by asif408
Tue Sep 17, 2019 10:45 am
Forum: Investing - Theory, News & General
Topic: Explaining the Demise of Value Investing
Replies: 318
Views: 17088

Re: Explaining the Demise of Value Investing

This fallacy keeps on getting repeated here, hat Value has performed better overseas. Just because there are no Intl SCG Index funds in existence over the same period. I cleared this yesterday with another poster. Since DFA introduced their Intl SCG funds and Intl LCG funds, they have outperformed ...
by asif408
Tue Sep 17, 2019 8:49 am
Forum: Investing - Theory, News & General
Topic: Explaining the Demise of Value Investing
Replies: 318
Views: 17088

Re: Explaining the Demise of Value Investing

Because value has underperformed for the last 12 years pretty much worldwide. This is incorrect. U.S. small value ( represented by IJS here ) has pretty much followed the total market movements until around the middle of 2017. Any significant underperformance is pretty much limited to the last ~2 y...
by asif408
Tue Sep 17, 2019 8:25 am
Forum: Investing - Theory, News & General
Topic: Explaining the Demise of Value Investing
Replies: 318
Views: 17088

Re: Explaining the Demise of Value Investing

I do find it interesting that there's a lot of suspicion around the value factor, but not so much the size factor? Or maybe it's just not being voiced. Because value has underperformed for the last 12 years pretty much worldwide. Small has only started to underperform in the last few years, and it'...
by asif408
Wed Sep 11, 2019 8:28 am
Forum: Investing - Theory, News & General
Topic: Explaining the Demise of Value Investing
Replies: 318
Views: 17088

Re: Explaining the Demise of Value Investing

asif First, there really is no low volatility premium, there is a negative premium for the highest volatility stocks, but even there it isn't just high volatility, it's junk high vol (like low profits). The lowest vol stocks actually have had lower returns than the middle vol stocks. In other words...
by asif408
Tue Sep 10, 2019 2:22 pm
Forum: Investing - Theory, News & General
Topic: Explaining the Demise of Value Investing
Replies: 318
Views: 17088

Re: Explaining the Demise of Value Investing

had another thought that might be helpful The investment philosophy of basically all at this site is based on belief that markets pretty efficient. If that is so then it amazes me that there are so many who think it doesn't make sense to have higher expected returns to SV vs TSM. TSM has historical...
by asif408
Tue Sep 10, 2019 1:10 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 264
Views: 28956

Re: Small Cap Value heads Rejoice !!!

ThereAreNoGurus wrote:
Tue Sep 10, 2019 10:04 am
Thx for the response. No argument with what you say here.

To clarify, I did say "for the most part," which means I do have investments outside the US and I do look at valuations and may make changes based on tempting valuations, but I still read most forecasts for amusement. :D
Nice to know. :D
by asif408
Tue Sep 10, 2019 9:39 am
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 264
Views: 28956

Re: Small Cap Value heads Rejoice !!!

There are 2 reasons I only examined the large-cap forecast. It was the first one listed, and more importantly the bulk of my investments are in the S&P 500. You claim some forecast is better than none. In my case, I disagree. I read them mainly for entertainment purposes. I am, for the most part, a...
by asif408
Tue Sep 10, 2019 8:32 am
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 264
Views: 28956

Re: Small Cap Value heads Rejoice !!!

I located GMO's December 31, 2010, 7 year forecast at: https://www.valuewalk.com/wp-content/uploads/2011/02/GMO1.pdf I only looked into their prediction for large cap equities which was 0.4 real per year with a range of plus/minus 6.5%. However V00 returned 11.26 nominal. Inflation was probably und...
by asif408
Mon Sep 09, 2019 1:14 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value heads Rejoice !!!
Replies: 264
Views: 28956

Re: Small Cap Value heads Rejoice !!!

Heck, even GMO, which seems to have a reputation for being bearing on US stocks, is downright bullish (by GMO standards) on US SCV, they expect it to return more than everything but international value and EM (see page 9): https://www.gmo.com/globalassets/articles/quarterly-letter/2019/gmo-quarterly...
by asif408
Mon Sep 09, 2019 12:51 pm
Forum: Investing - Theory, News & General
Topic: Inflation likelihood and inflation protection
Replies: 29
Views: 1940

Re: Inflation likelihood and inflation protection

1) None of these scenarios are likely but "inflation surprises in the future" are virtually certain: the problem is accurately predicting the direction and magnitude of the surprises. 2) A globally diversified equity portfolio and a bond portfolio that includes TIPS are the easiest and cheapest pro...
by asif408
Fri Sep 06, 2019 12:24 pm
Forum: Investing - Theory, News & General
Topic: Can you lose money by buying CDs?
Replies: 24
Views: 2504

Re: Can you lose money by buying CDs?

In nominal terms, not unless you buy a negative rate CD (if they exist). In real terms, yes, depending on inflation.
by asif408
Thu Sep 05, 2019 1:07 pm
Forum: Investing - Theory, News & General
Topic: Which criteria should one consider when choosing between gold and commodities?
Replies: 26
Views: 1548

Re: Which criteria should one consider when choosing between gold and commodities?

So I understand that gold and commodities perform well in different enviroments, so in my case it's probably a good idea to have both (I already have some gold, about 5%, but I am increasing it in the next few months to 7 or 8%). That seems reasonable. Concerning commodities, I understand the probl...
by asif408
Thu Sep 05, 2019 8:12 am
Forum: Investing - Theory, News & General
Topic: Which criteria should one consider when choosing between gold and commodities?
Replies: 26
Views: 1548

Re: Which criteria should one consider when choosing between gold and commodities?

Seems like the question depends on your intended use. Are you looking for an inflation hedge, deflation hedge, etc? My understanding from some of the readings of William Bernstein is that gold itself is a good hedge in a deflationary crisis (like the 1929-1932 stock market crash or the 2007-2009 GFC...
by asif408
Tue Sep 03, 2019 10:15 am
Forum: Investing - Theory, News & General
Topic: Inflation Protected Securities: When to Get in, not How
Replies: 64
Views: 3859

Re: Inflation Protected Securities: When to Get in, not How

I wouldn't try to time based on some indicator, because most everyone else is following those indicators and will be 2 steps ahead of you. I would simply always hold some, and maybe bump my allocation up when softer sentiment, such as low inflation expectations, are prevalent. Remember, too, that st...
by asif408
Fri Aug 30, 2019 10:46 am
Forum: Investing - Theory, News & General
Topic: Dr. Bill Bernstein: Next "Bogleheads on Investing" podcast guest
Replies: 56
Views: 5357

Re: Dr. Bill Bernstein: Next "Bogleheads on Investing" podcast guest

Dr. Bernstein: If you were setting a portfolio today for a young person with a long time horizon, how would you allocate your stock portion? You've voiced in recent years that the expected returns for foreign and value stocks are higher than domestic and growth stocks, and also mentioned at a Bogleh...
by asif408
Fri Aug 30, 2019 10:33 am
Forum: Investing - Theory, News & General
Topic: Japan and PE Ratio
Replies: 45
Views: 3496

Re: Japan and PE Ratio

The 10 year 'lookback' of CAPE doesn't make sense to me if, as Shiller did, all ten years are equally weighted. It would make more sense to me to weight more recent years more heavily. Just curious, why would it make sense to weight more recent years more heavily? Because it seems logical that last...
by asif408
Fri Aug 30, 2019 10:19 am
Forum: Investing - Theory, News & General
Topic: Japan and PE Ratio
Replies: 45
Views: 3496

Re: Japan and PE Ratio

The 10 year 'lookback' of CAPE doesn't make sense to me if, as Shiller did, all ten years are equally weighted. It would make more sense to me to weight more recent years more heavily. Just curious, why would it make sense to weight more recent years more heavily? Isn't the whole point of the CAPE ...
by asif408
Fri Aug 30, 2019 8:20 am
Forum: Investing - Theory, News & General
Topic: Does the US dollar mean revert?
Replies: 36
Views: 1850

Re: Does the US dollar mean revert?

Of course, the relative strength does change. However, that relative strength is bounded and does revert - sort of. FX rates are bounded by Purchasing Power Parity (PPP). They stick within a +/- 20% range of "fair value". A they do mean revert - over a period of 10 years. So it is hard to exploit. ...
by asif408
Fri Aug 30, 2019 7:48 am
Forum: Investing - Theory, News & General
Topic: Japan and PE Ratio
Replies: 45
Views: 3496

Re: Japan and PE Ratio

No need to be rude. If U.S. CAPE is not reliable, then any comparison with other countries' CAPE ratios may not be reliable. No need to even address other countries' CAPE. Beyond that, it is well known that the increasing interest in buybacks is unique to the U.S. market and may explain the differe...
by asif408
Thu Aug 29, 2019 8:33 am
Forum: Investing - Theory, News & General
Topic: Japan and PE Ratio
Replies: 45
Views: 3496

Re: Japan and PE Ratio

CAPE has serious issues: 1) IT will be greater when there's buybacks since it allows inflation adjusted EPS to grow faster than without buybacks So Comparing post 2000 readings to pre 1990 readings when buybacks barely existed has a bias issue. 2) CAPE relies on adjusting 10 years of EPS to present...
by asif408
Thu Aug 29, 2019 7:21 am
Forum: Investing - Theory, News & General
Topic: Japan and PE Ratio
Replies: 45
Views: 3496

Re: Japan and PE Ratio

Barclays has CAPE data for Japan and the US going back to 1981, along with about 25 other countries: https://shiller.barclays.com/SM/12/en/indices/static/historic-ratios.app Japan had two periods (late 1980s and early to mid-2000s) where their CAPE ratios were in the 70-90 range. These high reading ...
by asif408
Wed Aug 28, 2019 8:55 am
Forum: Investing - Theory, News & General
Topic: What are the disadvantages of tilting away from biggest sectors?
Replies: 18
Views: 927

Re: What are the disadvantages of tilting away from biggest sectors?

If tech stocks keep outperforming and become a bigger and bigger portion of the indices, you'll underperform. That's the biggest disadvantage, and you don't know for sure how long that can continue. Another disadvantage is that it requires more complexity (more funds), and you also have to decide ho...
by asif408
Wed Aug 28, 2019 8:14 am
Forum: Personal Investments
Topic: Don't Chase Returns: Infographic?
Replies: 7
Views: 1104

Re: Don't Chase Returns: Infographic?

You can make your own like this. Here is a chart of US stocks, small cap value stocks, US REITs, and precious metals equities from 1994-2000: https://finance.yahoo.com/chart/VTSMX#eyJpbnRlcnZhbCI6Im1vbnRoIiwicGVyaW9kaWNpdHkiOjEsImNhbmRsZVdpZHRoIjoyNi40ODQ4NDg0ODQ4NDg0ODQsInZvbHVtZVVuZGVybGF5Ijp0cnVl...
by asif408
Tue Aug 27, 2019 2:53 pm
Forum: Investing - Theory, News & General
Topic: Best of Bogleheads - your #1 takeaway
Replies: 151
Views: 14749

Re: Best of Bogleheads - your #1 takeaway

I agree with the simplicity viewpoints. The way I word it to others is that I should be able to count a large majority (e.g., 95%) of my investment positions on one hand. Otherwise, it's way too complicated. So right now I have US, developed ex-US, and emerging markets funds, and 1 or 2 sector funds...