Search found 6566 matches

by lack_ey
Wed Jul 18, 2018 1:18 pm
Forum: Investing - Help with Personal Investments
Topic: Why Does Vanguard Emerging Markets not Tie to Market Caps?
Replies: 5
Views: 449

Re: Why Does Vanguard Emerging Markets not Tie to Market Caps?

You're not looking at free float, are you?

Most stock indexes intended for investment adjust weights for float.
by lack_ey
Tue Jul 17, 2018 8:57 pm
Forum: Investing - Theory, News & General
Topic: Titans of Junk: Behind the Debt Binge That Now Threatens Markets [Bloomberg article]
Replies: 14
Views: 2156

Re: Titans of Junk: Behind the Debt Binge That Now Threatens Markets [Bloomberg article]

... but Vanguard's site indicates that all of the corporate bonds are investment-grade. So I'd say no. Authors seem to imply that the securities are AAA rates: Not at all. I specifically said "investment-grade." AAA is not the only bond grade labeled as investment-grade. An investment grade is a ra...
by lack_ey
Mon Jul 16, 2018 9:12 pm
Forum: Investing - Theory, News & General
Topic: Classifying CDs as Bonds or Short Term assets
Replies: 12
Views: 1030

Re: Classifying CDs as Bonds or Short Term assets

Brokered CDs = Bonds Bank CDs = Cash That doesn't make any sense. Surely maturity is far more important when deciding how to classify fixed income instruments. "Cash" is short-term fixed income like money market and short-term bonds. I don't think that's unreasonable. With respect to investment beh...
by lack_ey
Fri Jul 13, 2018 8:32 am
Forum: Investing - Help with Personal Investments
Topic: expense ratio in a fund containing funds
Replies: 9
Views: 759

Re: expense ratio in a fund containing funds

Expense ratios from holdings should show up in "acquired fund fees and expenses" or something similar I think for investment trusts. At least in mutual fund land the amount quoted includes and accounts for the expense ratios of the underlying holdings. I'm fairly sure it works the same here. These u...
by lack_ey
Wed Jul 11, 2018 8:15 am
Forum: Investing - Theory, News & General
Topic: VMMXX and inflation/interest rates
Replies: 7
Views: 932

Re: VMMXX and inflation/interest rates

Over the last 100+ years in the U.S., Treasury bill returns have beaten inflation by a bit over half a percent a year on average. But that includes about a 50-year period of cumulative losing to inflation. Note that the country was growing faster over this period than it is now, with respect to popu...
by lack_ey
Mon Jul 09, 2018 9:53 pm
Forum: Investing - Theory, News & General
Topic: 50/50 blend of VWENX+VUSUX provides ridiculous risk adjusted return vs 100% stocks
Replies: 22
Views: 2640

Re: 50/50 blend of VWENX+VUSUX provides ridiculous risk adjusted return vs 100% stocks

Wellington has underperformed its composite index over the past 10 years, a classic case of a fund becoming too big to outperform ($100 billion in assets) and turning into a closet index fund. Another example of recency bias and skating to where the puck was. Or is it, perhaps, at least partly beca...
by lack_ey
Mon Jul 09, 2018 1:46 pm
Forum: Investing - Theory, News & General
Topic: 50/50 blend of VWENX+VUSUX provides ridiculous risk adjusted return vs 100% stocks
Replies: 22
Views: 2640

Re: 50/50 blend of VWENX+VUSUX provides ridiculous risk adjusted return vs 100% stocks

Basically backtesting the last 30+ years using long-term Treasuries looks really good as the term premium was heavily rewarded—there was a risk premium priced in and then conditions turned favorable with with inflation dropping and yields falling, and they helped in market declines especially aroun...
by lack_ey
Mon Jul 09, 2018 10:13 am
Forum: Investing - Theory, News & General
Topic: 50/50 blend of VWENX+VUSUX provides ridiculous risk adjusted return vs 100% stocks
Replies: 22
Views: 2640

Re: 50/50 blend of VWENX+VUSUX provides ridiculous risk adjusted return vs 100% stocks

First of all, the URL you linked doesn't include the results. You need to click on the "Link" link next to Portfolio Analysis Results for that. Secondly, I think you generally want to use the Investor share classes rather than Admiral to get a longer history with Vanguard funds. Sure, the ERs will b...
by lack_ey
Sun Jul 08, 2018 8:52 pm
Forum: Investing - Theory, News & General
Topic: Silver ETF [How does it track the spot price?]
Replies: 17
Views: 922

Re: Silver ETF [How does it track the spot price?]

Technically the legal structure for SIVR is a grantor trust and not a fund in the strict sense. There's no relationship or mechanism directly tying the price to spot silver price or something close to it. It's just that the value of one share is a fractional ownership of the structure, so effectivel...
by lack_ey
Sun Jul 08, 2018 11:45 am
Forum: Investing - Help with Personal Investments
Topic: Increasing bond exposure, but confused by rating
Replies: 5
Views: 320

Re: Increasing bond exposure, but confused by rating

Morningstar star ratings are evaluations of fund past risk-adjusted return relative to peers in a weighted average of trailing 3-year, 5-year, and 10-year evaluation windows. The top 10% by this measure are 5 stars, the next 22.5% 4 stars, the middle 35% 3 stars, the next 22.5% 2 stars, and the bott...
by lack_ey
Thu Jul 05, 2018 8:08 pm
Forum: Investing - Help with Personal Investments
Topic: What stocks are excluded from VG’s total international funds?
Replies: 6
Views: 658

Re: What stocks are excluded from VG’s total international funds?

The remaining 2% by market cap is the micro caps... if you mean something like FTSE Global All Cap, which covers large / mid / small but not micro in developed and emerging markets. VTIAX is ex-US so obviously it's missing a whole lot more than 2%: the US stocks. Check FTSE docs: http://www.ftse.com...
by lack_ey
Thu Jul 05, 2018 8:38 am
Forum: Investing - Theory, News & General
Topic: Anyone tilting heavy to international based on current forecasts?
Replies: 38
Views: 3937

Re: Anyone tilting heavy to international based on current forecasts?

Under the understanding of most models, the point estimates for international equity returns are usually higher, but the distributions are hugely overlapping, and the models are likely not particularly correct anyway. If you were to market time generally, this is not a particularly strong signal so ...
by lack_ey
Wed Jul 04, 2018 10:04 pm
Forum: Investing - Theory, News & General
Topic: Yield curves and bond returns
Replies: 31
Views: 2556

Re: Yield curves and bond returns

It seems like linear interpolation would be wrong (we expect the difference between 7yr and 6yr to be slightly smaller than between 6yr and 5yr under a typical yield curve). I'm sure there is some better way, probably covered somewhere in the literature. Or just use a higher-order fit. But I doubt i...
by lack_ey
Tue Jun 26, 2018 7:51 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard ultrashort term vs. iShares
Replies: 10
Views: 1076

Re: Vanguard ultrashort term vs. iShares

The similar yields to me kind of implies that the iShares fund is taking more credit risk (to balance out the lower term risk), but that doesn't seem to be obviously the case. I'm not sure why you say that? ICSH has no Aaa rated debt, 49% AA or lower, compared to 36% for Vanguard. Essentially none ...
by lack_ey
Tue Jun 26, 2018 5:57 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard ultrashort term vs. iShares
Replies: 10
Views: 1076

Re: Vanguard ultrashort term vs. iShares

The similar yields to me kind of implies that the iShares fund is taking more credit risk (to balance out the lower term risk), but that doesn't seem to be obviously the case. Also, when you compare Vanguard's fund especially to other relatively cheap (though higher ER) ultrashort bond ETFs that hav...
by lack_ey
Tue Jun 26, 2018 3:26 pm
Forum: Investing - Theory, News & General
Topic: To bond barbell or not to barbell, that is the question
Replies: 6
Views: 1355

Re: To bond barbell or not to barbell, that is the question

Assuming some given duration, the barbell (some long-term, some short-term) should probably have a slightly lower yield on average but a little higher convexity to compensate for that, compared to an all-maturity approach or especially compared to a bullet. So the barbell is better if yields change ...
by lack_ey
Sun Jun 24, 2018 11:49 am
Forum: Investing - Help with Personal Investments
Topic: CA Muni bond fund - reinvest vs transfer to MMF
Replies: 11
Views: 752

Re: CA Muni bond fund - reinvest vs transfer to MMF

None of the below relevant to the specific fund mentioned: Vanguard bond fund dividends are accrued daily and credited monthly. Kevin I'm not sure based on context how broadly you meant this, but for clarification, generally this is not true when looking across all Vanguard bond funds. They do not a...
by lack_ey
Sat Jun 23, 2018 3:43 pm
Forum: Investing - Theory, News & General
Topic: Anyone use “baskets”at fidelity?
Replies: 10
Views: 1283

Re: Anyone use “baskets”at fidelity?

So you end up placing market orders for several securities simultaneously, paying commissions on each of them?

It seems like not much of a convenience feature for a smaller grouping and then too expensive (commissions) for a larger grouping.
by lack_ey
Fri Jun 22, 2018 7:22 pm
Forum: Investing - Theory, News & General
Topic: AQR throws a bit of shade at CAPE
Replies: 19
Views: 2066

Re: AQR throws a bit of shade at CAPE

I’d be cautious in accepting aqr’s argument that the small cap premium does not exist. I admit I haven’t read the paper but I also haven’t seen fama French publish a retraction of their 3 factor paper either. I think it’s important to understand thAt Aqr is not necessarily a disinterested actor on ...
by lack_ey
Thu Jun 21, 2018 7:04 pm
Forum: Investing - Theory, News & General
Topic: Are mutual funds safer than ETFs?
Replies: 15
Views: 1745

Re: Are mutual funds safer than ETFs?

With ever more exotic ETFs appearing almost weekly, and at least one serious liquidity incident this year and a growing number of dark-warning articles, I can't help feeling good about having most of my portfolio in stodgy old mutual funds. How inclusive is your definition or meaning of "ETF" here?...
by lack_ey
Thu Jun 21, 2018 10:42 am
Forum: Investing - Theory, News & General
Topic: Effect of Index funds on Market Efficiency
Replies: 19
Views: 1252

Re: Effect of Index funds on Market Efficiency

Indexing is currently less than 5% of trading volume. Most of the rest is institutional, not driven by retail investors. There are many more hedge funds, mutual funds, etc. than before, on top of HFT and all kinds of algorithmic trading. Bid/ask spreads are down, volume is higher than historical. Th...
by lack_ey
Wed Jun 20, 2018 10:29 am
Forum: Investing - Theory, News & General
Topic: The Current Market
Replies: 22
Views: 1817

Re: The Current Market

I'm not really seeing 2018 as notable or outside the expectations. If anything, 2017 was more unusual in the stock market though hardly shocking. If you're wiggle-watching, maybe take a look at mid-2010, which even more so than 2015 or some other times coincidentally kind of looks similar. Obviously...
by lack_ey
Wed Jun 20, 2018 1:04 am
Forum: Investing - Help with Personal Investments
Topic: Opinions on iShares FLOT -- Floating rate bond ETF
Replies: 6
Views: 575

Re: Opinions on iShares FLOT -- Floating rate bond ETF

So... what's the difference between FLOT and the bank loans that Larry is talking about? I don't understand the difference. Senior loans aka leveraged loans aka bank loans are issued by banks to other companies, mostly those with lower credit ratings though some may be near the bottom of investment...
by lack_ey
Tue Jun 19, 2018 11:53 pm
Forum: Investing - Help with Personal Investments
Topic: Opinions on iShares FLOT -- Floating rate bond ETF
Replies: 6
Views: 575

Re: Opinions on iShares FLOT -- Floating rate bond ETF

Most big companies (with investment-grade ratings on their bonds) issue a lot of short-term debt. It's called commercial paper. Many could issue floating-rate bonds or more of them if they wanted. The interest rate swaps market is huge and switching between floating or fixed payments is not that big...
by lack_ey
Tue Jun 19, 2018 9:30 pm
Forum: Investing - Theory, News & General
Topic: Effective Number of Bets, or how many funds is enough?
Replies: 16
Views: 1212

Re: Effective Number of Bets, or how many funds is enough?

Thanks for the responses. I think I need to check some of the papers later and stew on it then.
by lack_ey
Tue Jun 19, 2018 7:09 pm
Forum: Investing - Theory, News & General
Topic: Effective Number of Bets, or how many funds is enough?
Replies: 16
Views: 1212

Re: Effective Number of Bets, or how many funds is enough?

What's the raw data for the inputs. Daily fund returns? Going how far back? The new Vanguard factor funds are only a few months old. How are the weightings between the funds determined, or does this wash away somewhere (how?) in the computation? How robust are the results? If you run on say 2008-201...
by lack_ey
Tue Jun 19, 2018 1:44 pm
Forum: Investing - Theory, News & General
Topic: Are the Fed and Treasury distorting the MBS market?
Replies: 16
Views: 1646

Re: Are the Fed and Treasury distorting the MBS market?

Actually, can anybody explain why the performance of the GNMA fund and the MBS index fund are very close in the past year? Given similar duration, the greater increase in yield of the MBS fund and the lower starting yield would all else equal seem to imply a disadvantage of more than about 0.2% over...
by lack_ey
Mon Jun 18, 2018 8:50 pm
Forum: Investing - Theory, News & General
Topic: Smart and Not-so-Smart Beta ETF closures
Replies: 2
Views: 409

Re: Smart and Not-so-Smart Beta ETF closures

Four international currency-hedged minimum volatility funds and nine multifactor single sector (US) funds. That sounds like perhaps not bad ideas but rather specific and narrow ones. I guess they just never attracted enough assets. Though on second thought I kind of think currency hedging some inter...
by lack_ey
Mon Jun 18, 2018 1:32 pm
Forum: Investing - Theory, News & General
Topic: Are the Fed and Treasury distorting the MBS market?
Replies: 16
Views: 1646

Re: Are the Fed and Treasury distorting the MBS market?

The GNMA fund can be a bit weird and its own thing, being actively managed and not by Vanguard. Checking the MBS index fund for reference... https://i.imgur.com/uIUsp1o.png historical SEC yield data pulled from Vanguard's site I wish they would let you access more than one year at a time. I guess it...
by lack_ey
Mon Jun 18, 2018 9:47 am
Forum: Investing - Theory, News & General
Topic: Is individual Bonds better than Bond Fund?
Replies: 32
Views: 2326

Re: Is individual Bonds better than Bond Fund?

With individual bonds you get more control on effectively the cash flows, choosing when to buy and sell. You get to determine the risk exposures, maturity dates, and what to do. And then what do you do with that control and how much meaningful difference does it make? Also with control you acquire ...
by lack_ey
Mon Jun 18, 2018 9:38 am
Forum: Investing - Theory, News & General
Topic: Is individual Bonds better than Bond Fund?
Replies: 32
Views: 2326

Re: Is individual Bonds better than Bond Fund?

With individual bonds you get more control on effectively the cash flows, choosing when to buy and sell. You get to determine the risk exposures, maturity dates, and what to do. But that doesn't really have to do with rising interest rates or interest rate risk. Bonds have risk whether held directly...
by lack_ey
Sun Jun 17, 2018 12:57 pm
Forum: Investing - Theory, News & General
Topic: Are Vanguard's actively managed funds better?
Replies: 11
Views: 1675

Re: Are Vanguard's actively managed funds better?

This whole series from IFA suffers from kind of sloppy methods. The benchmarks often don't match the funds that well, sometimes because nothing really is available. Note the weird mix of share classes used, though most here are investor shares (higher ER, looks worse) Here in particular note all the...
by lack_ey
Sun Jun 17, 2018 12:49 pm
Forum: Investing - Theory, News & General
Topic: how can i determine if Wellington only takes long stock positions?
Replies: 9
Views: 469

Re: how can i determine if Wellington only takes long stock positions?

Look at the list of holdings in the annual report. See anything short?

Shorting is also something that would come up in the prospectus in terms of risks if applicable (it's not).
by lack_ey
Sun Jun 17, 2018 12:10 pm
Forum: Personal Consumer Issues
Topic: Has Anyone Tried Youtube TV?
Replies: 22
Views: 1695

Re: Has Anyone Tried Youtube TV?

Have you looked around at the competitors? I think the big live TV services over the internet are DirecTV Now, Sling TV, Playstation Vue, Hulu with Live TV, and then YouTube TV. The big concern for many is local channel coverage (for local news, NFL and some other sports, etc.)—all have some but not...
by lack_ey
Sat Jun 16, 2018 10:57 am
Forum: Investing - Theory, News & General
Topic: Cash question
Replies: 14
Views: 1324

Re: Cash question

Most bond fund returns over the long term are from the distributions. You wouldn't have capital gains unless the relevant yields are falling. If you're in the 12% tax bracket then absolutely not muni bonds then, never mind. Is it really that bad paying tax on 12% taxable interest? Is the tax on with...
by lack_ey
Sat Jun 16, 2018 10:38 am
Forum: Investing - Theory, News & General
Topic: Cash question
Replies: 14
Views: 1324

Re: Cash question

You could put it in after tax and use a short-term municipal bond fund (or muni money market if you really must) if that's superior in your current tax bracket to the alternatives. Vanguard has some decent fund there, and now with the recent fee cut iShares Short-Term National Muni Bond ETF (SUB) is...
by lack_ey
Sat Jun 16, 2018 9:42 am
Forum: Investing - Theory, News & General
Topic: Bill Gross' fund, lately...
Replies: 12
Views: 1272

Re: Bill Gross' fund, lately...

The fund can have (significantly) negative duration at times, heavy exposure to high yield or whatever else if it wants, etc. and is significantly different from PIMCO Total Return. Since inception in 2014, PIMCO Total Return has had a 0.89 correlation to Vanguard Total Bond on monthly returns. Janu...
by lack_ey
Fri Jun 15, 2018 5:19 pm
Forum: Investing - Theory, News & General
Topic: Vanguard New Factor Funds Portfolio Statistics
Replies: 175
Views: 21232

Re: Vanguard New Factor Funds Portfolio Statistics

I saw this in a recent ETF.com article: http://www.etf.com/sections/features-and-news/leaving-cash-trading-floor?nopaging=1 The Cost Of Active Management Vanguard has explained that its main motivation for active management in factor funds is not to avoid front-running, but to maintain high factor e...
by lack_ey
Fri Jun 15, 2018 2:21 pm
Forum: Investing - Theory, News & General
Topic: Flaw in Logic? CD ladder instead of bond funds
Replies: 63
Views: 4827

Re: Flaw in Logic? CD ladder instead of bond funds

If I am looking for "debt" instruments to provide stability in my retirement funds why are bond funds better than a CD ladder, other than liquidity? Other than liquidity, which seems like it shouldn't be dismissed, there are potentially higher returns from credit risk using bond funds, and some oth...
by lack_ey
Fri Jun 15, 2018 1:37 pm
Forum: Investing - Help with Personal Investments
Topic: Quick question about vangaurd settlement fund
Replies: 4
Views: 440

Re: Quick question about vangaurd settlement fund

Would it be better to put a certain amount of money in either a settlement account currently at 1.75% or Long term treasury at 2.9% if I may need access to it within the next year or at least part of it. Part of the money is an emergency fund. The other is money I have saved to pay of a commercial ...
by lack_ey
Fri Jun 15, 2018 11:54 am
Forum: Investing - Help with Personal Investments
Topic: Vanguard Managed Payout Fund
Replies: 29
Views: 2511

Re: Vanguard Managed Payout Fund

Yeah. This was what I was struggling with. Love the idea of the product but couldn't see how admittedly a more complex AA was getting me (give or take) 20+ bps of value versus a Lifestrategy. The quoted expense ratio is 0.34% but 0.12% of that just reflects borrowing and dividend costs on short sal...
by lack_ey
Fri Jun 15, 2018 10:17 am
Forum: Investing - Help with Personal Investments
Topic: Opinions on SFSNX vs. SCHA. Schwab small cap funds
Replies: 1
Views: 157

Re: Opinions on SFSNX vs. SCHA. Schwab small cap funds

There's a Schwab Fundamental U.S. Small Company Index ETF (FNDA) that kind of matches the mutual fund you mentioned, just FYI. In a taxable account you would want to use the ETF. It's just another choice if you'd rather pay extra to get a value tilt with the fundamental indexing methodology, achieve...
by lack_ey
Fri Jun 15, 2018 10:13 am
Forum: Investing - Theory, News & General
Topic: PUTW to diversify sequence of returns
Replies: 13
Views: 841

Re: PUTW to diversify sequence of returns

The expected returns should not be equivalent over time, I would think, even before costs. Downside beta is not 1 (and upside is definitely way less than 1). Part of the equity risk premium seems to come from the uncertainty of how much the upside could be, not just uncertainty on the downside. Over...
by lack_ey
Thu Jun 14, 2018 9:28 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard Managed Payout Fund
Replies: 29
Views: 2511

Re: Vanguard Managed Payout Fund

Thank you for you detailed answer, and of course your time. May I ask, since this is coming from an IRA account, do they automatically deduct taxes each month? Vanguard can automatically withhold a set percentage of distributions from a Vanguard IRA account for taxes. Other platforms frequently hav...
by lack_ey
Thu Jun 14, 2018 7:32 pm
Forum: Investing - Theory, News & General
Topic: Factor Diversification = Beta?
Replies: 7
Views: 667

Re: Factor Diversification = Beta?

Concentration in small hundreds of stocks is not really that much of a disadvantage compared to owning 10k+ stocks in a global total market style when it comes to diversifying individual stock risks. As you say, factor loads are an issue, and owning a lot of everything will get you close to the mark...
by lack_ey
Thu Jun 14, 2018 7:23 pm
Forum: Investing - Help with Personal Investments
Topic: Vanguard Managed Payout Fund
Replies: 29
Views: 2511

Re: Vanguard Managed Payout Fund

It's an actively managed balanced fund engaging in some mild-moderate market timing but generally staying on the aggressive side for what is kind of intended as a retirement inccome vehicle, typically owning something like 60% stocks. Most of what it owns is index funds, but with some tilts here and...
by lack_ey
Thu Jun 14, 2018 10:41 am
Forum: Investing - Theory, News & General
Topic: Is the Dow Jones Industrial Average a useful metric?
Replies: 28
Views: 1522

Re: Is the Dow Jones Industrial Average a useful metric?

It's useful in the sense of being more representative of the market than you might think for something that has such glaring problems as you mention.

There's not really any reason to use it over other indexes except for tradition and continuity in a dumb sense.
by lack_ey
Wed Jun 13, 2018 10:15 am
Forum: Investing - Help with Personal Investments
Topic: Please advise re:Guggenheim intermediate bond fund class p SIUPX
Replies: 17
Views: 615

Re: Please advise re:Guggenheim intermediate bond fund class p SIUPX

Luckygirl, SIUPX is a lower grade bond fund (BB) and that's why the recent returns look OK--higher risk. You should get higher returns for taking that risk. In 2008 the fund lost 11% while Vanguard Total Bond (AA) gained 5%. You have to decide if you want the higher risk in one of your bond funds. ...
by lack_ey
Wed Jun 13, 2018 10:03 am
Forum: Investing - Theory, News & General
Topic: Buy LEAPS vs stocks
Replies: 7
Views: 827

Re: Buy LEAPS vs stocks

So what is the actual objective? Do you effectively just want leverage on the underlying asset, or is it the specific return profile of the option (relative to the underlying stock, and which changes over time) that you're interested in? As a hedge, speculation, part of a larger trade, or what? Depe...
by lack_ey
Wed Jun 13, 2018 1:51 am
Forum: Investing - Theory, News & General
Topic: Why does CAPM make sense?
Replies: 23
Views: 1126

Re: Why does CAPM make sense?

Most importantly, you're not analyzing things that make much sense under CAPM. Single stocks are highly driven by undiversified, idiosyncratic risk, especially some stocks. It's a large collection of stocks (where the undiversified components start averaging each other out) that is better modeled b...