Search found 381 matches

by privatefarmer
Sun Jan 13, 2019 5:03 am
Forum: Investing - Theory, News & General
Topic: International ETFs with 0% dividend withholding tax?
Replies: 22
Views: 2360

Re: International ETFs with 0% dividend withholding tax?

... can a US resident/investor buy an international ETF based in Ireland ... ? Not without encountering the sort of punitive US tax laws that will leave you envying the dead at tax time. Why Americans Should Never Own Shares in a Non-US Mutual Fund (PFIC) thanks for all the responses! I think I am ...
by privatefarmer
Sun Jan 13, 2019 3:00 am
Forum: Investing - Theory, News & General
Topic: International ETFs with 0% dividend withholding tax?
Replies: 22
Views: 2360

Re: International ETFs with 0% dividend withholding tax?

sorry for the novice question, but can a US resident/investor buy an international ETF based in Ireland and then only pay the US dividend tax rate of 15%? if so, anyone know of a global ex-US ETF that is based in Ireland? and can this be bought on interactive brokers? thanks
by privatefarmer
Thu Jan 10, 2019 12:06 pm
Forum: Investing - Theory, News & General
Topic: January "Bogleheads on Investing" podcast with Gus Sauter now available
Replies: 32
Views: 2326

Re: January "Bogleheads on Investing" podcast with Gus Sauter now available

Thanks Rick, excellent podcast. I really appreciate his injsght into smart beta. I find over time I have completely come to the same conclusions as you and Gus. Please keep the podcasts coming!
by privatefarmer
Mon Jan 07, 2019 8:36 am
Forum: Investing - Theory, News & General
Topic: Small Value Premium - How Do You View It?
Replies: 128
Views: 11029

Re: Small Value Premium - How Do You View It?

I don’t know, maybe I have a fundamental misunderstanding of how markets work, but if all the money was pouring into small cap the stock prices would rise , market caps increase, and there wouldn’t be any small cap stocks-just a ton of stocks with relatively similar market caps. That hasn’t happene...
by privatefarmer
Tue Jan 01, 2019 5:04 am
Forum: Investing - Theory, News & General
Topic: International Funds Still Relevant in a Simple Portfolio?
Replies: 72
Views: 4693

Re: International Funds Still Relevant in a Simple Portfolio?

I'm a little bipolar on this... used to be globally weighted then went all domestic but now back to global weights. I don't like the higher costs/taxation of INTL however there was a great podcast on this subject, the "animal spirits" podcast, a few episodes back they detailed the history of INTL vs...
by privatefarmer
Sat Dec 29, 2018 12:28 am
Forum: Investing - Theory, News & General
Topic: Why not go all small cap value for equities?
Replies: 72
Views: 4416

Re: Why not go all small cap value for equities?

one other thought I have is that when you compare vanguards small cap fund vs TSM since inception (~1989 I believe), they're essentially tied. Now some will argue that that is because vanguard is not as "small" as funds like DFA, they are more of a mid-cap/small-cap blend. That's a fine argument how...
by privatefarmer
Fri Dec 28, 2018 10:25 am
Forum: Investing - Theory, News & General
Topic: Why not go all small cap value for equities?
Replies: 72
Views: 4416

Re: Why not go all small cap value for equities?

Privatefarmer, You know I’m going to disagree with you on DFA being active versus passive. I view DFA as passive. It is formulaic, and has no individual stock picking or market timing. It simply provides passive access to the factors that have been shown to explain equity returns. It tries to add v...
by privatefarmer
Fri Dec 28, 2018 1:20 am
Forum: Investing - Theory, News & General
Topic: Why not go all small cap value for equities?
Replies: 72
Views: 4416

Re: Why not go all small cap value for equities?

Why not 100% small cap growth, it seemed to do much better over the last 10 years. Also doing better YTD. There’s a decent argument to be made here - and it’s why I choose TSM in the end. SCV has long term sex appeal. Growth stocks are crushing it at the moment and might continue into the future. I...
by privatefarmer
Fri Dec 28, 2018 1:18 am
Forum: Investing - Theory, News & General
Topic: Why not go all small cap value for equities?
Replies: 72
Views: 4416

Re: Why not go all small cap value for equities?

Very simple answer: Because you'll be increasing your risk by a greater degree than your potential return. Note: The increase in risk comes from two areas: 1) You are less diversified both in terms of owning fewer stocks and different types of stocks. 2) Small caps are [supposedly] more risky than ...
by privatefarmer
Fri Dec 28, 2018 1:10 am
Forum: Investing - Theory, News & General
Topic: Why not go all small cap value for equities?
Replies: 72
Views: 4416

Re: Why not go all small cap value for equities?

Why not 100% small cap growth, it seemed to do much better over the last 10 years. Also doing better YTD. There’s a decent argument to be made here - and it’s why I choose TSM in the end. SCV has long term sex appeal. Growth stocks are crushing it at the moment and might continue into the future. I...
by privatefarmer
Fri Dec 28, 2018 1:04 am
Forum: Investing - Theory, News & General
Topic: Why not go all small cap value for equities?
Replies: 72
Views: 4416

Re: Why not go all small cap value for equities?

You could make a strong argument that all SCV is the way to go on the equity side. A long only SCV fund will have exposure to market beta, size, and value factors. A TSM fund will have exposure to only the single factor, market beta. Size and value are unique and independent factors from each other...
by privatefarmer
Fri Dec 28, 2018 12:46 am
Forum: Investing - Theory, News & General
Topic: Why not go all small cap value for equities?
Replies: 72
Views: 4416

Re: Why not go all small cap value for equities?

Sorry if this has been covered, but I did not find it in a search. Judging by the available data going back to 1972 for asset classes on Portforlio Visualizer, sure seems like it is worth heavily or completely tilting towards US small cap value. If equities are supposed to be your risk, is it not w...
by privatefarmer
Sat Dec 22, 2018 10:39 am
Forum: Investing - Theory, News & General
Topic: All the "should I be 100% stocks" threads over the last year.
Replies: 175
Views: 11862

Re: All the "should I be 100% stocks" threads over the last year.

If you count my fixed rate mortgage as leverage, I’m 200% stocks. Not the least bit concerned. Do I have any inking to sell equities and pay off my mortgage? No. That’d be ridiculous. I’m 34 years old. 100% equities, plus a fixed rate mortgage, when you’re young is absolutely reasonable and I think ...
by privatefarmer
Sat Dec 22, 2018 7:59 am
Forum: Investing - Theory, News & General
Topic: 1-yr Emergency Fund
Replies: 10
Views: 1541

Re: 1-yr Emergency Fund

The other thing is that as your NW grows your taxable Acct will likely be several fold what your EF should be (ie 1 year of expenses). So even if you had a large drawdown in stocks your EF would likely still be larger than required.
by privatefarmer
Sat Dec 22, 2018 7:57 am
Forum: Investing - Theory, News & General
Topic: 1-yr Emergency Fund
Replies: 10
Views: 1541

Re: 1-yr Emergency Fund

IMO it depends on your net worth. If you have a very positive net worth and you would otherwise be 100% equity, I don’t see why you shouldn’t have your “emergency fund” in equities. My EF is just my taxable brokerage Acct. Even if it fell by 50% and I had to make some withdrawals during a job loss, ...
by privatefarmer
Sat Dec 22, 2018 7:30 am
Forum: Investing - Theory, News & General
Topic: Percentage of Net Worth in Equities
Replies: 23
Views: 1916

Re: Percentage of Net Worth in Equities

~200% in stocks if you consider mortgage as leverage. Otherwise 100% stocks.
by privatefarmer
Fri Dec 21, 2018 11:12 am
Forum: Investing - Theory, News & General
Topic: Artemis Attack on the Bogleheads
Replies: 80
Views: 9163

Re: Artemis Attack on the Bogleheads

He exaggerates and overgeneralizes everything, and sounds like he is whining about why hedge fund managers like himself are underperforming: Here is what I heard: "Central Banks have put all active managers out of business." "The more the market is dominated by passive investors the less opportunit...
by privatefarmer
Wed Dec 19, 2018 1:52 am
Forum: Investing - Theory, News & General
Topic: Question on DFA's overall theory....
Replies: 18
Views: 1457

Re: Question on DFA's overall theory....

a couple points : 1) there are firms (FPL capital management, for instance) which will sell you DFA access for a nominal one-time fee. With their already-higher ERs over vanguard, however, I would closely analyze all the costs associated w/ trying to "beat the market"... 2) they are without a doubt ...
by privatefarmer
Sat Dec 08, 2018 1:15 am
Forum: Investing - Theory, News & General
Topic: Ignored Risks of Factor Investing
Replies: 104
Views: 5399

Re: Ignored Risks of Factor Investing

We now had 10 years of non existent value premium, and others have been very weak, what now? wait another 10 years for a total of 20, and if it doesn't show up even after that then what? actually, if you compare large growth vs large value over the last 30 years there has been no difference...
by privatefarmer
Sat Dec 08, 2018 1:04 am
Forum: Investing - Theory, News & General
Topic: What is your allocation to U.S. and International?
Replies: 220
Views: 14282

Re: What is your allocation to U.S. and International?

I only hold INTL in my taxable acct due to the ability to get the foreign tax credit. I figure if you do not get that credit then you're losing ~30bps in foreign taxes so I would never hold INTL in a retirement acct. I also believe that if you hold MULTINATIONAL companies (ie the s/p 500) you are in...
by privatefarmer
Fri Dec 07, 2018 4:53 am
Forum: Investing - Theory, News & General
Topic: We Are Teetering on the Edge of A DEATH CROSS
Replies: 50
Views: 8623

Re: We Are Teetering on the Edge of A DEATH CROSS

I think it is useful to stay on top of financial news. For example, GE's troubles are a warning sign. Additional signs from other companies might make a Treasury Fund more appealing than a general Bond Fund. Give up a little yield and sleep better. Or when my company's CFO resigned, I lightened up ...
by privatefarmer
Mon Dec 03, 2018 1:22 am
Forum: Investing - Theory, News & General
Topic: Bogle Sounds a Warning on Index Funds
Replies: 103
Views: 18959

Re: Bogle Sounds a Warning on Index Funds

the market would correct itself. if index funds started owning "too much" of the publicly traded companies, these companies would in theory start to suffer, right? that's the idea anyhow. if that happened, guess what? people would sell their index fund shares and go buy some actively managed funds w...
by privatefarmer
Sun Dec 02, 2018 4:48 am
Forum: Investing - Theory, News & General
Topic: foreign tax credit
Replies: 12
Views: 979

foreign tax credit

does anyone know if the foreign tax credit covers 100% of foreign taxes paid, or does it only give a credit up to the amount that one would have paid in US taxes? Ie if a European country charges 25% on dividends, would a US investor get a credit for that full 25% or only up to 15% (the US rate on q...
by privatefarmer
Thu Nov 29, 2018 1:40 pm
Forum: Investing - Theory, News & General
Topic: How much international stock? A suggestion.
Replies: 754
Views: 100675

Re: How much international stock? A suggestion.

interesting how some bogleheads are incapable of selecting stocks while capable of selecting stock markets. I guess you haven't heard how much safer, better regulated, etc. the US is than every other country in the world. Plus it is most of the world's market cap (just like Japan was in the 1980s),...
by privatefarmer
Thu Nov 29, 2018 1:38 pm
Forum: Investing - Theory, News & General
Topic: How much international stock? A suggestion.
Replies: 754
Views: 100675

Re: How much international stock? A suggestion.

interesting how some bogleheads are incapable of selecting stocks while capable of selecting stock markets. I guess you haven't heard how much safer, better regulated, etc. the US is than every other country in the world. Plus it is most of the world's market cap (just like Japan was in the 1980s),...
by privatefarmer
Wed Nov 28, 2018 4:34 pm
Forum: Investing - Theory, News & General
Topic: How much international stock? A suggestion.
Replies: 754
Views: 100675

Re: How much international stock? A suggestion.

My conclusion : multinational companies headquartered in the US have done about 40-45% of their business overseas. To me it is completely logical that in today’s market just owning the companies in the s/p 500 will give you adequate exposure to the global economy. "Adequate" is hard word to nail do...
by privatefarmer
Wed Nov 28, 2018 4:30 pm
Forum: Investing - Theory, News & General
Topic: How much international stock? A suggestion.
Replies: 754
Views: 100675

Re: How much international stock? A suggestion.

My understanding is that if held in a retirement account you still pay foreign taxes... I’m paying a tax on the international funds in my 401k and Roth IRA? What is this “foreign tax” you speak of? Right. You pay taxes to other govts on the funds you own in retirement accts but do not get a tax cre...
by privatefarmer
Wed Nov 28, 2018 12:08 pm
Forum: Investing - Theory, News & General
Topic: How much international stock? A suggestion.
Replies: 754
Views: 100675

Re: How much international stock? A suggestion.

I have read several times in these international threads making reference to additional “hidden” costs of owning international stocks, specifically around taxes. Can someone explain this to me in simple terms, or point me to another thread that explains it? My understanding is that if held in a ret...
by privatefarmer
Sun Nov 25, 2018 2:50 pm
Forum: Investing - Theory, News & General
Topic: Small Value: 15 years of underperforming
Replies: 143
Views: 11673

Re: Small Value: 15 years of underperforming

Garland, the better indexes do a good job filtering out the "lottery stocks" the academics rail about. This is why when you use actual indexes to compare factor strategies against indexes that you often don't see the premiums. From all I have been reading, it seems that Quality/Profitability is whe...
by privatefarmer
Sun Nov 25, 2018 2:45 pm
Forum: Investing - Theory, News & General
Topic: Small Value: 15 years of underperforming
Replies: 143
Views: 11673

Re: Small Value: 15 years of underperforming

stlutz wrote: Okay, so here is a comparison of Vanguard Small Growth and Value with DFA Small Value thrown in from 6/98 through 9/18: https://www.portfoliovisualizer.com/bac ... ion3_3=100 Results: VG Small Value: 9.06% VG Small Growth: 9.45% DFA Small Value: 9.87% I pulled down the monthly returns...
by privatefarmer
Sun Nov 25, 2018 2:37 pm
Forum: Investing - Theory, News & General
Topic: Small Value: 15 years of underperforming
Replies: 143
Views: 11673

Re: Small Value: 15 years of underperforming

Vanguard small cap value index is much more midcap than small cap value True but if you expect a “risk premium” then it should be positive, albeit to a lesser degree, amongst mid cap stocks as well as small. And I would argue vanguard is more half mid half small, making it smaller than straight mid...
by privatefarmer
Sat Nov 24, 2018 10:54 pm
Forum: Investing - Theory, News & General
Topic: What is your allocation to U.S. and International?
Replies: 220
Views: 14282

Re: What is your allocation to U.S. and International?

0% international Same here. After researching some on taxation, INTL is without a doubt more expensive. I cannot seem to find good data in just how much more expensive, but I did find that the foreign tax credit does not fully reimburse foreign taxes paid if they are more than what you’d have paid ...
by privatefarmer
Thu Nov 22, 2018 9:54 am
Forum: Investing - Theory, News & General
Topic: "Investing" conversations at work
Replies: 32
Views: 4404

Re: "Investing" conversations at work

Did coworker ask for your opinion? If not, I would not offer it. Never ends well. I spend much of my time at work on bogleheads or like-minded websites and I figure if anyone is really interested in learning then maybe they will see the websites I look at and take interest. There's no benefit in tal...
by privatefarmer
Tue Nov 20, 2018 4:41 am
Forum: Investing - Theory, News & General
Topic: How much international stock? A suggestion.
Replies: 754
Views: 100675

Re: How much international stock? A suggestion.

Why does nobody ever mention taxes?? International stocks would need to outperform in order to get the same return as US stocks. You can't put international stocks in a retirement account otherwise other countries will tax your dividends and you can't do anything about it. If you put them in a taxa...
by privatefarmer
Tue Nov 20, 2018 3:10 am
Forum: Personal Finance (Not Investing)
Topic: Early 401k withdrawal
Replies: 2
Views: 421

Early 401k withdrawal

According to the IRS, if you are a police office, firefighter or “emergency medical personnel” you may withdraw from 401k at age 50 w/o paying 10% early withdrawal penalty. Does anyone know who exactly qualifies as “emergency medical personnel”? I am a pharmacist at a hospital who services an emerge...
by privatefarmer
Mon Nov 19, 2018 2:14 am
Forum: Investing - Theory, News & General
Topic: If riskier than US, why doesn't international outperform?
Replies: 245
Views: 15567

Re: If riskier than US, why doesn't international outperform?

this thread has been very insightful. I now have more questions that I started with. My main question is : how much more expensive is it to hold international stocks vs US stocks? I tried finding good data on the historical return of the MSCI EAFE index and it seems like it has lagged the US market...
by privatefarmer
Mon Nov 19, 2018 1:42 am
Forum: Investing - Theory, News & General
Topic: If riskier than US, why doesn't international outperform?
Replies: 245
Views: 15567

Re: If riskier than US, why doesn't international outperform?

this thread has been very insightful. I now have more questions that I started with. My main question is : how much more expensive is it to hold international stocks vs US stocks? I tried finding good data on the historical return of the MSCI EAFE index and it seems like it has lagged the US market ...
by privatefarmer
Sat Nov 17, 2018 5:23 pm
Forum: Investing - Theory, News & General
Topic: If riskier than US, why doesn't international outperform?
Replies: 245
Views: 15567

Re: If riskier than US, why doesn't international outperform?

The relationship between risk and return is being misunderstood in some of this discussion. Risk as measured by the volatility of an asset does not imply higher expected returns for an investment. There are plenty of high volatility assets that have low expected returns, even negative expected retu...
by privatefarmer
Sat Nov 17, 2018 12:54 am
Forum: Investing - Theory, News & General
Topic: If riskier than US, why doesn't international outperform?
Replies: 245
Views: 15567

Re: If riskier than US, why doesn't international outperform?

US companies has a lot revenue from int'l market. If you won US company, you basically own the world. US companies are running more efficient than international counterpart, so we do see US equity outperform than intl. But as US equity valuation become too rich than intl, the tide will reverse. Now...
by privatefarmer
Sat Nov 17, 2018 12:52 am
Forum: Investing - Theory, News & General
Topic: If riskier than US, why doesn't international outperform?
Replies: 245
Views: 15567

Re: If riskier than US, why doesn't international outperform?

There is an inherent lack of predictability in the market. Mr. Market seems to enjoy frustrating those who develop theories and narratives to explain why it does what it does when it does, and to predict its future. In theory taking on increased risk is expected to produce increased reward because ...
by privatefarmer
Tue Nov 13, 2018 1:40 pm
Forum: Investing - Theory, News & General
Topic: A reminder: Stay away from AQR
Replies: 172
Views: 13651

Re: A reminder: Stay away from AQR

Should read: Stay away from AQR if you don't understand or wish to invest in a factor based strategy. Growth has outperformed value over the past few years, propelled in large part by FANG megacap names. We saw similar outperformance of growth vs value during the tech bubble. Over long time horizon...
by privatefarmer
Mon Nov 05, 2018 3:08 am
Forum: Investing - Theory, News & General
Topic: Risk-based factor explanations: How can factors be non-diversifiable risk?
Replies: 8
Views: 804

Re: Risk-based factor explanations: How can factors be non-diversifiable risk?

So it seems that for risk-based explanations to fly, we need the factor to have some sort of uncomparable risk vs the market? E.g. a two-dimensional risk measure where some investors prefer a risk of (2,3) and some prefer (3,2), but neither risk is strictly better than the other? That's basically c...
by privatefarmer
Mon Oct 22, 2018 2:34 am
Forum: Investing - Theory, News & General
Topic: DFA small value... acitve management?
Replies: 103
Views: 6321

Re: DFA small value... acitve management?

I believe DFA is totally passive. They define a segment of the market with specific rules: size by market cap and price by book to market (I believe they still only use one metric because they believe it is the most stable one). They access the SV segment with a passive rules based market cap weigh...
by privatefarmer
Sun Oct 21, 2018 1:24 am
Forum: Investing - Theory, News & General
Topic: DFA small value... acitve management?
Replies: 103
Views: 6321

Re: DFA small value... acitve management?

privatefarmer wrote: It seems like they keep "fine tuning" it/throwing in new factors ie profitability/liquidity etc etc, doesn't seem as passive as I once thought... would love some input from anyone w/ more insight... It seems to me that you've got plenty of insight yourself, private farmer. Fact...
by privatefarmer
Sun Oct 21, 2018 12:26 am
Forum: Investing - Theory, News & General
Topic: DFA small value... acitve management?
Replies: 103
Views: 6321

Re: DFA small value... acitve management?

The S&P500 has added 16 companies this year, and 26 in 2017. Are Standard and Poor's active managers? yeah, but the cost is basically zero. I prefer TSM to S/P 500, but if you can own 80% of the market w/ basically zero cost then I suppose that's "good enough". I think we all understand, it's not a...
by privatefarmer
Sun Oct 21, 2018 12:24 am
Forum: Investing - Theory, News & General
Topic: DFA small value... acitve management?
Replies: 103
Views: 6321

Re: DFA small value... acitve management?

privatefarmer wrote: It seems like they keep "fine tuning" it/throwing in new factors ie profitability/liquidity etc etc, doesn't seem as passive as I once thought... would love some input from anyone w/ more insight... It seems to me that you've got plenty of insight yourself, private farmer. Fact...
by privatefarmer
Sat Oct 20, 2018 2:11 am
Forum: Investing - Theory, News & General
Topic: DFA small value... acitve management?
Replies: 103
Views: 6321

Re: DFA small value... acitve management?

My biggest concern is that over time they keep adding new "factors" based on backtested data... it seems like if small/value were true risk premiums that could be extracted they wouldn't need to add all these newer factors... They hire PhDs who spend their time doing research. If a factor shows an ...
by privatefarmer
Sat Oct 20, 2018 1:13 am
Forum: Investing - Theory, News & General
Topic: DFA small value... acitve management?
Replies: 103
Views: 6321

Re: DFA small value... acitve management?

My biggest concern is that over time they keep adding new "factors" based on backtested data... it seems like if small/value were true risk premiums that could be extracted they wouldn't need to add all these newer factors...
by privatefarmer
Sat Oct 20, 2018 12:12 am
Forum: Investing - Theory, News & General
Topic: DFA small value... acitve management?
Replies: 103
Views: 6321

DFA small value... acitve management?

from the prospectus on DFAs small value fund DFSVX : "The Advisor may adjust the representation in the U.S. Small Cap Value Portfolio of an eligible company, or exclude a company, after considering such factors as free float, momentum, trading strategies, liquidity, value, profitability, and other f...
by privatefarmer
Tue Sep 25, 2018 2:08 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Factors Persist In Emerging Markets
Replies: 31
Views: 2436

Re: Larry Swedroe: Factors Persist In Emerging Markets

[/quote] I think many people investing in smart beta strongly expect these factors to always be positive. [/quote] I would hope not. ALWAYS be positive? That would be a naive way of looking at it. No intelligent investor expects stocks to always beat bonds. No smart beta investor, who knows what the...