Search found 5935 matches

by watchnerd
Sat May 02, 2020 6:13 pm
Forum: Investing - Theory, News & General
Topic: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?
Replies: 89
Views: 4635

Re: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?

However, at current valuations there is significant downside risk to long-term treasuries as they are historically expensive. I think comparing valuations between them is an exercise in futility because they're not fungible goods. If you *must have* income payments, consistently, then stocks don't ...
by watchnerd
Sat May 02, 2020 10:48 am
Forum: Investing - Theory, News & General
Topic: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?
Replies: 89
Views: 4635

Re: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?

And relative to stocks, does that make them cheap or expensive right now? Here is a comparison of SEC dividend yields and 30-year treasury: Vanguard Total Stock Market Index (VTI): 2.20% Vanguard International Total Index (VXUS): 3.77% 30-year Treasury: 1.27% Let's assume that dividends drop 25% li...
by watchnerd
Sat May 02, 2020 10:34 am
Forum: Investing - Theory, News & General
Topic: Long Term Treasury (VGLT) vs. Ext Duration Treasury (EDV)
Replies: 11
Views: 978

Re: Long Term Treasury (VGLT) vs. Ext Duration Treasury (EDV)

2. I bet the folks employing a Long Term Treasury strategy in their portfolio are quite happy this week! Yes, quite happy. What funds or ETFs are you using for your AA (which I see in your sig). I hold both ETF and mutual fund versions of the Vanguard Long Treasury index (VGLT / VLGSX). Why did you...
by watchnerd
Thu Apr 30, 2020 8:21 pm
Forum: Investing - Theory, News & General
Topic: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?
Replies: 89
Views: 4635

Re: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?

Isn´t there any scenario in which you would market time and change your asset allocation? If stocks were at a P/E ratio of 100, wouldn´t you change the course? Now LTT are at record high valuations . By what measure? Expected future real returns? I'm not so sure.... LTT are at record valuation. The...
by watchnerd
Thu Apr 30, 2020 7:37 pm
Forum: Investing - Theory, News & General
Topic: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?
Replies: 89
Views: 4635

Re: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?

TheoLeo wrote:
Thu Apr 30, 2020 4:36 pm


Isn´t there any scenario in which you would market time and change your asset allocation? If stocks were at a P/E ratio of 100, wouldn´t you change the course? Now LTT are at record high valuations.
By what measure?

Expected future real returns?

I'm not so sure....
by watchnerd
Thu Apr 30, 2020 2:33 pm
Forum: Investing - Theory, News & General
Topic: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?
Replies: 89
Views: 4635

Re: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?

atdharris wrote:
Thu Apr 30, 2020 2:14 pm
I am not sure how much higher my TLT will go either. I am tempted to take profits and re-balance it into something else. I suppose LT rates could go to 0, in which case the value of TLT will keep going up, but at some point, I think it gets maxed out.
Does market timing work for bonds?
by watchnerd
Wed Apr 29, 2020 10:19 am
Forum: Investing - Theory, News & General
Topic: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?
Replies: 89
Views: 4635

Re: Is LTT appearing "nice" only because interest rates has been dropping since "forever"?

I would nitpick and say your data is general interest rates, mine is specifically the rates for 30-year treasuries. But more importantly, you are referring to minor fluctuations. LTT rates have been on the downtrend since the 1980s. If I wave a magic wand and say LTT rates will increase to 10% over...
by watchnerd
Tue Apr 28, 2020 9:35 am
Forum: Investing - Theory, News & General
Topic: Does anyone use global cap weight plus a set domestic tilt for equities?
Replies: 64
Views: 2428

Re: Does anyone use global cap weight plus a set domestic tilt for equities?

rascott wrote:
Tue Apr 28, 2020 7:11 am

Vanguard also runs actively managed funds, a zoo of factor funds, sector funds, etc.

The site is titled Bogleheads.... not Vanguardheads
Well, if my sin is that I'm not slavish to everything Jack said, call me guilty.

I didn't realize investing was a personality cult.
by watchnerd
Tue Apr 28, 2020 2:18 am
Forum: Investing - Theory, News & General
Topic: Does anyone use global cap weight plus a set domestic tilt for equities?
Replies: 64
Views: 2428

Re: Does anyone use global cap weight plus a set domestic tilt for equities?

rascott wrote:
Tue Apr 28, 2020 1:11 am

I'll chime in that it's consistently amazing to me that a site named after Jack Bogle has so many followers that only follow half his advice.
Perhaps you should ask Vanguard why they don't follow Jack's advice in the Target Retirement funds.
by watchnerd
Mon Apr 27, 2020 5:15 pm
Forum: Investing - Theory, News & General
Topic: Does anyone use global cap weight plus a set domestic tilt for equities?
Replies: 64
Views: 2428

Re: Does anyone use global cap weight plus a set domestic tilt for equities?

All of this second-guessing is one of the reasons I just go with global market weight and let it ride. It's behaviorally easy for me to comply with. The market will do what it does, and I don't have to worry about fiddling or re-examining if my tweakery or tilts were right nor not. Hey, I was wonde...
by watchnerd
Sat Apr 25, 2020 10:48 am
Forum: Investing - Theory, News & General
Topic: Bonds won't get you anywhere!
Replies: 85
Views: 9049

Re: Bonds won't get you anywhere!

oldfort wrote:
Sat Apr 25, 2020 10:37 am


That's like the old joke how do you end up with a small fortune? Start with a larger one.
Yep.

If you've won the game, lots of bonds are fine.
by watchnerd
Fri Apr 24, 2020 5:53 pm
Forum: Investing - Theory, News & General
Topic: Forecast Stock and Bond Returns: Crisis Edition from M*/Vanguard/...
Replies: 10
Views: 925

Re: Forecast Stock and Bond Returns: Crisis Edition from M*/Vanguard/...

confusedinvestor wrote:
Fri Apr 24, 2020 3:31 pm

ps: I've seen Vanguard/BlackRock/M* projections (such as this) wrong for last 4 years in a row... :o
How do you know a 10 year projection is wrong after only 4 years?
by watchnerd
Fri Apr 24, 2020 5:46 pm
Forum: Investing - Theory, News & General
Topic: Forecast Stock and Bond Returns: Crisis Edition from M*/Vanguard/...
Replies: 10
Views: 925

Re: Forecast Stock and Bond Returns: Crisis Edition from M*/Vanguard/...

M*'s Experts Forecast Stock and Bond Returns: Crisis Edition https://www.morningstar.com/articles/979744/article - What do BH Experts think ? - Is anyone changing return projections on their plans which may impact savings rate, how long they may have to work, or AA/risk changes ? - Int outperformin...
by watchnerd
Fri Apr 24, 2020 5:04 pm
Forum: Investing - Theory, News & General
Topic: Does anyone use global cap weight plus a set domestic tilt for equities?
Replies: 64
Views: 2428

Re: Does anyone use global cap weight plus a set domestic tilt for equities?

I've been having trouble recently understanding the logic behind anyone (and I include myself here b/c I do this) using market cap weight within the US market (Total US) and market cap weight outside the US market (Total International) but then either throwing market weight out the window and inste...
by watchnerd
Fri Apr 24, 2020 5:01 pm
Forum: Investing - Theory, News & General
Topic: Bonds won't get you anywhere!
Replies: 85
Views: 9049

Re: Bonds won't get you anywhere!

I know people are probably going to throw this back in my face. But I’ve been flipping bonds into equities like an insane person during this crisis. Over rebalancing if you will. I have no regrets with this strategy. If you over-rebalanced at the March low, where does that leave your AA now? How mu...
by watchnerd
Fri Apr 24, 2020 3:55 pm
Forum: Investing - Theory, News & General
Topic: Bonds won't get you anywhere!
Replies: 85
Views: 9049

Re: Bonds won't get you anywhere!

The yield on TIPS is negative. If bonds are giving a 0% real return , then anyone in the accumulation phase either needs to put almost all their retirement savings in stocks or maintain a very high savings rate to reach their retirement goals. Bonds are good for those who are already retired. 0% re...
by watchnerd
Fri Apr 24, 2020 12:53 pm
Forum: Personal Finance (Not Investing)
Topic: Best Covid19 resistant job
Replies: 154
Views: 9617

Re: Best Covid19 resistant job

Septic tank pumping service.
by watchnerd
Fri Apr 24, 2020 9:12 am
Forum: Personal Finance (Not Investing)
Topic: Best Covid19 resistant job
Replies: 154
Views: 9617

Re: Best Covid19 resistant job

Carmen1409 wrote:
Thu Apr 23, 2020 9:41 pm

Personally, I chose to work in government because of 2008. I decided I’d rather be underpaid with good benefits and stability than risk instability and no benefits again,
When pensions are factored in, I'm not sure how underpaid gov workers really are.
by watchnerd
Thu Apr 23, 2020 11:47 pm
Forum: Investing - Theory, News & General
Topic: The Fed may have fundamentally altered the nature of risk in the stock market
Replies: 51
Views: 6180

Re: The Fed may have fundamentally altered the nature of risk in the stock market

We just had a 35% stock market drop, and 12 years ago had a 50% drop, even with major Fed action on both. Even if an 80 or 90% drop is off the table, equities are still nowhere near the risk levels of things like high rated government bonds. I'm trying to parse your comment. Are you saying Treasuri...
by watchnerd
Thu Apr 23, 2020 8:06 pm
Forum: Investing - Theory, News & General
Topic: The Fed may have fundamentally altered the nature of risk in the stock market
Replies: 51
Views: 6180

Re: The Fed may have fundamentally altered the nature of risk in the stock market

I would agree that if risk is fundamentally lessened, the market would be willing to pay more for stocks (discounting in a smaller risk premium) which would lower returns. This can already be seen with historical returns before and after it was understood that unsystematic risk could be diversified...
by watchnerd
Thu Apr 23, 2020 8:03 pm
Forum: Investing - Theory, News & General
Topic: Does anyone use global cap weight plus a set domestic tilt for equities?
Replies: 64
Views: 2428

Re: Does anyone use global cap weight plus a set domestic tilt for equities?

I think I chimed in to some of the other posts by siamond (and you too goonie), but my current equity weightings have been in line with MSCI ACWI for about the last 10 years (when I started to get serious about investing/saving and getting my finances into shape). However I'm now considering a tilt...
by watchnerd
Thu Apr 23, 2020 8:00 pm
Forum: Investing - Theory, News & General
Topic: Does anyone use global cap weight plus a set domestic tilt for equities?
Replies: 64
Views: 2428

Re: Does anyone use global cap weight plus a set domestic tilt for equities?

More good points. Another counter to MotoTrojan's point could be that you really do want to increase/decrease the tilt as cap weight goes down/up because you don't want to be too lightly/heavily invested in domestic. So the slight change as cap weight slides up and down may be considered acceptable...
by watchnerd
Thu Apr 23, 2020 6:13 pm
Forum: Investing - Theory, News & General
Topic: Does anyone use global cap weight plus a set domestic tilt for equities?
Replies: 64
Views: 2428

Re: Does anyone use global cap weight plus a set domestic tilt for equities?

If I did this I would make the tilt proportional to the current landscape. A fixed 10% tilt as described means your tilt gets bigger as US weight goes down, and down as it goes up. Good point. I hadn't thought of that. It's a very good point. But also one that requires micro managing. I'm way too l...
by watchnerd
Thu Apr 23, 2020 12:29 pm
Forum: Investing - Theory, News & General
Topic: The Fed may have fundamentally altered the nature of risk in the stock market
Replies: 51
Views: 6180

Re: The Fed may have fundamentally altered the nature of risk in the stock market

If the economy continued to fall into a depression with deflation, the Gov would issue bonds (the Fed would buy them at zero interest) and the money would be given to people until deflation is stopped. So there is a backstop to prices falling (including indirectly stock prices). But the risk remain...
by watchnerd
Thu Apr 23, 2020 11:32 am
Forum: Personal Investments
Topic: Does anyone sell puts in order to force re-balancing and collect premiums?
Replies: 34
Views: 1690

Re: Does anyone sell puts in order to force re-balancing and collect premiums?

"an insurance cost "? I'm not sure I understand where the cost is. If stocks go down, he gets rebalanced and buys them at a lower cost as he cashed in the premium. If stocks go up, he pockets the premium and he does not need to rebalance. What am I missing? The time element. If stocks don't move mu...
by watchnerd
Thu Apr 23, 2020 11:01 am
Forum: Investing - Theory, News & General
Topic: First 20% of bonds in long-term Treasuries
Replies: 807
Views: 51873

Re: First 20% of bonds in long-term Treasuries

The main fly in the ointment of LTT + stocks is inflation. Damaging to both, as back in the 1970s. You either have to disregard that threat or try to hedge it in some way to cover all the bases. I hedge it by having a barbell of LTT + short TIPS. As explained above, this is a gun with no ammo: "The...
by watchnerd
Thu Apr 23, 2020 10:59 am
Forum: Personal Investments
Topic: Does anyone sell puts in order to force re-balancing and collect premiums?
Replies: 34
Views: 1690

Re: Does anyone sell puts in order to force re-balancing and collect premiums?

And what about when the market moves in the opposite direction?

Then you've incurred an insurance cost that could have been avoided by just exercising rebalancing discipline.

I don't see how this is some kind of free lunch unless you have certainty about market direction.
by watchnerd
Thu Apr 23, 2020 10:42 am
Forum: Personal Investments
Topic: If you were 30... Fidelity Role Play
Replies: 21
Views: 1760

Re: If you were 30... Fidelity Role Play

mrspock wrote:
Wed Apr 22, 2020 9:50 pm
Disappointed.... thought this was a Westworld thread. :(
Yeah, I want my money back.

This is the worst role play ever.
by watchnerd
Thu Apr 23, 2020 10:38 am
Forum: Investing - Theory, News & General
Topic: First 20% of bonds in long-term Treasuries
Replies: 807
Views: 51873

Re: First 20% of bonds in long-term Treasuries

CULater wrote:
Thu Apr 23, 2020 9:00 am
The main fly in the ointment of LTT + stocks is inflation. Damaging to both, as back in the 1970s. You either have to disregard that threat or try to hedge it in some way to cover all the bases.
I hedge it by having a barbell of LTT + short TIPS.
by watchnerd
Thu Apr 23, 2020 10:28 am
Forum: Personal Investments
Topic: How are the "100% Stocks" people doing?
Replies: 137
Views: 11400

Re: How are the "100% Stocks" people doing?

100% VTWAX before and after, and doing quite alright. The biggest lesson I got out of all of this was not to treat my emergency fund like dry powder for timing the market. I didn't use it all, but I overbought just a little when the market was down about 7%-10% (what a buying opportunity, right?!),...
by watchnerd
Thu Apr 23, 2020 9:49 am
Forum: Investing - Theory, News & General
Topic: Does anyone use global cap weight plus a set domestic tilt for equities?
Replies: 64
Views: 2428

Re: Does anyone use global cap weight plus a set domestic tilt for equities?

The theory behind holding global cap weight is CAPM, which is proven to be wrong. OTOH, multi-factor models doesn't imply global cap weight portfolio is efficient. The rationale for international is to diversify your human capital. If you live in US, TSM is highly correlated with your human capital...
by watchnerd
Wed Apr 22, 2020 4:09 pm
Forum: Investing - Theory, News & General
Topic: So bottom is probably behind us....right?
Replies: 709
Views: 63149

Re: So bottom is probably behind us....right?

rockthisworld wrote:
Wed Apr 22, 2020 4:02 pm

Hopefully beats out 10k in the next 30-40 years??? Who knows??
30-40 year market forecast!!
by watchnerd
Tue Apr 21, 2020 10:16 am
Forum: Investing - Theory, News & General
Topic: Deflation is everywhere. Get used to it.
Replies: 151
Views: 14892

Re: Deflation is everywhere. Get used to it.

austin757 wrote:
Mon Apr 20, 2020 12:45 pm
I am currently 100% stock. Would Vanguard EDV ETF be a good fund for these times?
You're late to the party.
by watchnerd
Tue Apr 21, 2020 10:14 am
Forum: Personal Finance (Not Investing)
Topic: will covid 19 destroy senior campuses
Replies: 52
Views: 4365

Re: will covid 19 destroy senior campuses

sarahjane wrote:
Mon Apr 20, 2020 9:41 pm
Covid 19 has called into question retirement communal living. Can it survive?
Maybe.

It depends.
by watchnerd
Tue Apr 21, 2020 10:11 am
Forum: Investing - Theory, News & General
Topic: Does anyone use global cap weight plus a set domestic tilt for equities?
Replies: 64
Views: 2428

Re: Does anyone use global cap weight plus a set domestic tilt for equities?

For example, the US cap weight is currently about 57%. You could add say 10 to that to make your US allocation 67%. Then your International would be 33% (instead of the cap weight of 43%). And if US cap weight drops to 47%, your US allocation would be 57%. It's a way to use market weight but still ...
by watchnerd
Tue Apr 21, 2020 8:38 am
Forum: Investing - Theory, News & General
Topic: U.S. stocks in free fall
Replies: 18846
Views: 2634503

Re: U.S. stocks in free fall

Mactheriverrat wrote:
Mon Apr 20, 2020 10:20 pm
AnalogKid22 wrote:
Mon Apr 20, 2020 3:17 pm
Pandemic, unemployment, oil. Next?
Earth blows up! Film at 11:00.
North Korea!
by watchnerd
Tue Apr 21, 2020 8:36 am
Forum: Investing - Theory, News & General
Topic: Are Japan like "lost decades" possible in US and world stock market?
Replies: 82
Views: 8253

Re: Are Japan like "lost decades" possible in US and world stock market?

Vision wrote:
Tue Apr 21, 2020 5:23 am


So you are saying we should just buy the dip?
Why would you infer that?
by watchnerd
Mon Apr 20, 2020 4:54 pm
Forum: Investing - Theory, News & General
Topic: If everything is/was priced in, how to explain Amazon/Netflix growth?
Replies: 15
Views: 1200

Re: If everything is/was priced in, how to explain Amazon/Netflix growth?

firebirdparts wrote:
Mon Apr 20, 2020 4:17 pm
TL/DR is that the future is never priced in. They're just pulling your leg.
Or it's what sometimes get said by somebody on CNBC / internet forums who has no clue as to why the market did something counter-intuitive.
by watchnerd
Mon Apr 20, 2020 4:17 pm
Forum: Investing - Theory, News & General
Topic: If everything is/was priced in, how to explain Amazon/Netflix growth?
Replies: 15
Views: 1200

Re: If everything is/was priced in, how to explain Amazon/Netflix growth?

What I mean is - during height of pandemic it would seem obvious Amazon or Netflix would outperform in the short term....so one might think, "I will buy them!" But then one might also think "well everyone else knows that too, so its already priced into the price!" and decide not to buy. Yet it stil...
by watchnerd
Mon Apr 20, 2020 3:11 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks in free fall
Replies: 18846
Views: 2634503

Re: U.S. stocks in free fall

Rather quiet today. Everybody watching oil prices right now lol? I'm not. Did something interesting happen? You can get paid to take oil. That is interesting right? GL w/ the storage problem though! Only for WTI. So if you've got a spare swimming pool in Oklahoma, back up the truck, I guess.
by watchnerd
Mon Apr 20, 2020 2:30 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks in free fall
Replies: 18846
Views: 2634503

Re: U.S. stocks in free fall

Stef wrote:
Mon Apr 20, 2020 1:53 pm
Rather quiet today. Everybody watching oil prices right now lol?
I'm not.

Did something interesting happen?
by watchnerd
Fri Apr 17, 2020 9:04 pm
Forum: Investing - Theory, News & General
Topic: S&P PE now at 19.47
Replies: 33
Views: 2697

Re: S&P PE now at 19.47

Should I sell all my stocks and move to cash or something else? :confused Stocks are cheap. Interest rates are near zero. That all depends on your assumption about the ERP. What's yours? My calculations of the equity risk premium focuses on the framus which intersects with the ramistan approximatel...
by watchnerd
Fri Apr 17, 2020 6:31 pm
Forum: Investing - Theory, News & General
Topic: S&P PE now at 19.47
Replies: 33
Views: 2697

Re: S&P PE now at 19.47

bck63 wrote:
Fri Apr 17, 2020 6:26 pm
jpmorganfunds wrote:
Fri Apr 17, 2020 3:19 pm
Should I sell all my stocks and move to cash or something else? :confused
Stocks are cheap. Interest rates are near zero.
That all depends on your assumption about the ERP.

What's yours?
by watchnerd
Fri Apr 17, 2020 4:55 pm
Forum: Investing - Theory, News & General
Topic: S&P PE now at 19.47
Replies: 33
Views: 2697

Re: S&P PE now at 19.47

Yes. Unless prices then drop enough to offset. Yes, that seems the be the quandary for earnings. Stocks are a better buy at 18 than 22. But seemingly an even better buy at 100. I don't follow the logic He's saying if earnings go to zero, PE can go to infinity. Okay, but that would support what I'm ...
by watchnerd
Fri Apr 17, 2020 4:33 pm
Forum: Investing - Theory, News & General
Topic: S&P PE now at 19.47
Replies: 33
Views: 2697

Re: S&P PE now at 19.47

As earning drop, wouldn't that make the ratio higher (all else equal)? It would just show the price is even richer than before. Yes. Unless prices then drop enough to offset. Yes, that seems the be the quandary for earnings. Stocks are a better buy at 18 than 22. But seemingly an even better buy at...
by watchnerd
Fri Apr 17, 2020 4:31 pm
Forum: Investing - Theory, News & General
Topic: S&P PE now at 19.47
Replies: 33
Views: 2697

Re: S&P PE now at 19.47

jpmorganfunds wrote:
Fri Apr 17, 2020 3:19 pm
Should I sell all my stocks and move to cash or something else? :confused
I can't reconcile this question with your other threads.

I'm thus assuming it's a hypothetical question, as opposed to genuine.
by watchnerd
Fri Apr 17, 2020 4:22 pm
Forum: Investing - Theory, News & General
Topic: S&P PE now at 19.47
Replies: 33
Views: 2697

Re: S&P PE now at 19.47

BJJ_GUY wrote:
Fri Apr 17, 2020 4:16 pm


As earning drop, wouldn't that make the ratio higher (all else equal)? It would just show the price is even richer than before.
Yes.

Unless prices then drop enough to offset.
by watchnerd
Fri Apr 17, 2020 2:58 pm
Forum: Investing - Theory, News & General
Topic: Short vs long TIPS inflation protection
Replies: 63
Views: 5681

Re: Short vs long TIPS inflation protection

I'll be having my eye on today's 5 year auction re-open ... Today's 5 Year TIPS auction: Indicative Yield: - 0.351% But today's 5 year auction opening today showed ... I'd hoped the movement in March ... was a new trend and that I'd be buying the 5 year at today's auction. For the record, there is ...
by watchnerd
Fri Apr 17, 2020 12:07 pm
Forum: Investing - Theory, News & General
Topic: Ray Dalio: ‘you’d be pretty crazy to hold bonds’ right now
Replies: 128
Views: 13178

Re: Ray Dalio: ‘you’d be pretty crazy to hold bonds’ right now

Right. Which is why I said to invest it in TIPS if you need it to be worth something predictable 10 years from now. What's your thoughts on VTIP (Vanguard Short Term Inflation Protected Securities ETF) (SEC yield: .70%) as a way to hold TIPS? See my sig. ;) I know you like short TIPS but I was refe...
by watchnerd
Fri Apr 17, 2020 11:29 am
Forum: Investing - Theory, News & General
Topic: Ray Dalio: ‘you’d be pretty crazy to hold bonds’ right now
Replies: 128
Views: 13178

Re: Ray Dalio: ‘you’d be pretty crazy to hold bonds’ right now

Terrible idea yet nobody has any idea what that 100,000 will be worth . Au contraire. The $100,000 will be worth an inflation-adjusted $100,000 in the future, as defined by CPI. BND not Tips Right. Which is why I said to invest it in TIPS if you need it to be worth something predictable 10 years fr...