Search found 28487 matches

by dbr
Sat Apr 20, 2019 11:33 pm
Forum: Investing - Theory, News & General
Topic: Why don't dividends affect the cost basis?
Replies: 8
Views: 428

Re: Why don't dividends effect the cost basis?

It makes no sense that your broker is labelling that result the way you say. In the first place return is a ratio of gain to starting principal and not a number of dollars. The result would be a percent. Maybe you are misreading what it actually says. Obviously they are just reporting the current v...
by dbr
Sat Apr 20, 2019 11:00 pm
Forum: Investing - Theory, News & General
Topic: Why don't dividends affect the cost basis?
Replies: 8
Views: 428

Re: Why don't dividends effect the cost basis?

It makes no sense that your broker is labelling that result the way you say. In the first place return is a ratio of gain to starting principal and not a number of dollars. The result would be a percent. Maybe you are misreading what it actually says. Obviously they are just reporting the current va...
by dbr
Sat Apr 20, 2019 6:47 pm
Forum: Investing - Theory, News & General
Topic: Why diversification is not a viable strategy?
Replies: 206
Views: 10531

Re: Why diversification is not a viable strategy?

I won't be holding my breath. I have much more productive uses for my money. I am curious as to what, in your opinion, gives gold its "intrinsic value". Rarity isn't enough, since, as I've proven, rare does not equate to valuable. So, I am truly curious. I have no dog in this fight, but as an examp...
by dbr
Sat Apr 20, 2019 6:33 pm
Forum: Personal Finance (Not Investing)
Topic: Vacation home experiences?
Replies: 21
Views: 1303

Re: Vacation home experiences?

Where I live such a thing is not a vacation home but a way of life. If you don't have one your actual home here is a vacation home and people wonder when you are going to leave and go wherever you really live. But more seriously, we don't have one because compared to the people who do: 1a. We like t...
by dbr
Sat Apr 20, 2019 6:15 pm
Forum: Investing - Theory, News & General
Topic: Bond fund duration
Replies: 6
Views: 416

Re: Bond fund duration

That advice is somewhat off. What is true is that duration measures the length of time to an indifferent result from the time of a step change in interest rates compared to should interest rates remain unchanged. But interest rates constantly change, including the possibility that the interest rate ...
by dbr
Sat Apr 20, 2019 3:19 pm
Forum: Investing - Theory, News & General
Topic: a percentage decline is MORE than that decline OF YOUR GAINS??
Replies: 25
Views: 1578

Re: a percentage decline is MORE than that decline OF YOUR GAINS??

4. Volatility Drag is a matter then of thinking of returns as such: In year 1, My return was 20% In year 2 My return was 20% In year 3 my return was -40% What was my return. Using elementary school math, (20 + 20 + -40)/3 = 0 Obviously, each percentage was applied to a different base amount so you ...
by dbr
Sat Apr 20, 2019 3:05 pm
Forum: Personal Investments
Topic: Boglehead Philosophy - High Yield Dividend Funds
Replies: 16
Views: 1127

Re: Boglehead Philosophy - High Yield Dividend Funds

Let me know what information you need to determine what I should do, but I really wanted just the general thoughts around the funds and whether I should simply reallocate it to an index fund. One tangential point to be aware of is that you already are invested in an index fund. The only thing neces...
by dbr
Sat Apr 20, 2019 3:05 pm
Forum: Personal Investments
Topic: Boglehead Philosophy - High Yield Dividend Funds
Replies: 16
Views: 1127

Re: Boglehead Philosophy - High Yield Dividend Funds

Funds that pay high dividends in a taxable account can have a tax drag (subject to one's income tax rates). They also tend to have lower total return. Unless you need the income for spending you should focus more on a diversified total market fund (like Total Stock Market) which fulfills 3/3 of the...
by dbr
Sat Apr 20, 2019 2:58 pm
Forum: Investing - Theory, News & General
Topic: a percentage decline is MORE than that decline OF YOUR GAINS??
Replies: 25
Views: 1578

Re: a percentage decline is MORE than that decline OF YOUR GAINS??

Volatility drag is a term applied to the degree to which the compound return of a series of variable returns may be less than the compound return of the arithmetic average of the returns were that the return actually obtained in each period. (I think I have parsed that sentence correctly) Volatility...
by dbr
Sat Apr 20, 2019 2:25 pm
Forum: Investing - Theory, News & General
Topic: a percentage decline is MORE than that decline OF YOUR GAINS??
Replies: 25
Views: 1578

Re: a percentage decline is MORE than that decline OF YOUR GAINS??

pdavi21 wrote:
Sat Apr 20, 2019 1:58 pm
The Math is designed for ease of comparison, not regret minimization.
That is a very perceptive statement. One could add that math should also not contribute to regret. Math just is.
by dbr
Sat Apr 20, 2019 2:04 pm
Forum: Personal Consumer Issues
Topic: Optimizing credit card airline points
Replies: 60
Views: 1990

Re: Optimizing credit card airline points

I would say a retired person getting a "couple" of credit cards, not being a frequent flyer, and having a vision of flying even once or twice business or first class to places such as Australia, New Zealand, Africa, and Asia is going to be disappointed. That is not to say such things can't be done,...
by dbr
Sat Apr 20, 2019 1:52 pm
Forum: Personal Investments
Topic: Roth > 457? And investing at Chase?
Replies: 4
Views: 312

Re: Roth > 457? And investing at Chase?

You should probably not be trying to do what you want at Chase. If you want to buy Vanguard funds you should probably just open an account at Vanguard.
by dbr
Sat Apr 20, 2019 1:45 pm
Forum: Investing - Theory, News & General
Topic: a percentage decline is MORE than that decline OF YOUR GAINS??
Replies: 25
Views: 1578

Re: a percentage decline is MORE than that decline OF YOUR GAINS??

This "imbalance" is often used to justify arguments around volatility drag. https://medium.com/@mikeharrisNY/low-volatility-drag-is-also-bad-for-equity-growth-6400299b6d3d or as the article puts it "If there is a loss of 50%, then a gain of 100% must be realized to break even. " In my opinion thoug...
by dbr
Sat Apr 20, 2019 1:38 pm
Forum: Personal Consumer Issues
Topic: Optimizing credit card airline points
Replies: 60
Views: 1990

Re: Optimizing credit card airline points

I would say a retired person getting a "couple" of credit cards, not being a frequent flyer, and having a vision of flying even once or twice business or first class to places such as Australia, New Zealand, Africa, and Asia is going to be disappointed. That is not to say such things can't be done, ...
by dbr
Sat Apr 20, 2019 11:35 am
Forum: Personal Investments
Topic: Dividends & Capital Gains Distributions options within IRA, for QCD, RMD & Re-balancing?
Replies: 2
Views: 132

Re: Dividends & Capital Gains Distributions options within IRA, for QCD, RMD & Re-balancing?

Right There is no special point to directing the distributions to money funds ahead of time. There is also nothing particularly wrong with doing that either as it might mean not having to bother to make a sale. The result amounts to a slight bias of your asset allocation to cash at pretty nearly neg...
by dbr
Sat Apr 20, 2019 11:22 am
Forum: Investing - Theory, News & General
Topic: a percentage decline is MORE than that decline OF YOUR GAINS??
Replies: 25
Views: 1578

Re: a percentage decline is MORE than that decline OF YOUR GAINS??

I guess what I'm asking is: 1. is this a reason to periodically take gains off the table (to reduce the loss to one's gains)? The answer to that can be either yes or not but the reason is not a result of concocting some wrongly defined mathematical puzzles. The reason to stay invested is that your ...
by dbr
Sat Apr 20, 2019 11:08 am
Forum: Investing - Theory, News & General
Topic: a percentage decline is MORE than that decline OF YOUR GAINS??
Replies: 25
Views: 1578

Re: a percentage decline is MORE than that decline OF YOUR GAINS??

Let's say you invest $100 and you get a 100% return. You now have $200. Everyone knows that if you lose 50% you're now back to $100 where you started. But you didn't just lose 50% overall. You lost 100% of your gains. That is true and also irrelevant. The definition of return is that return is for ...
by dbr
Sat Apr 20, 2019 10:07 am
Forum: Personal Investments
Topic: Help calculating after tax yield
Replies: 8
Views: 366

Re: Help calculating after tax yield

Thank you for all your helpful replies! I love this forum. It looks like I can invest directly in 3 month T-bills that are yielding 2.45% right now and are state tax exempt, so my after tax yield would be 2.45*(1-0.24)=1.862%. This looks like the best after tax yield of the investments I’ve looked ...
by dbr
Sat Apr 20, 2019 9:39 am
Forum: Personal Investments
Topic: Where to park the next dollar, beyond 401k?
Replies: 10
Views: 1091

Re: Where to park the next dollar, beyond 401k?

Where you put "special goals" money depends on how important it is to you for that money to be reliably available compared to being used for an opportunity to earn greater return at a risk of the outcome being highly volatile, including losses. Since you distinguish this money from actually investin...
by dbr
Sat Apr 20, 2019 9:35 am
Forum: Personal Investments
Topic: Help calculating after tax yield
Replies: 8
Views: 366

Re: Help calculating after tax yield

An additional note is that you may not even want to know the after tax yields. The actual question is probably what your after tax income is going to be and for that you want the tax cost to net against gross income. Finding yield to get cost when you already have to find cost to calculate yield is ...
by dbr
Sat Apr 20, 2019 8:34 am
Forum: Personal Investments
Topic: Short Term Cash
Replies: 23
Views: 2648

Re: Short Term Cash

Holy Batman Dead Thread Revival! Any reason why you responded to a message from 16 months ago? Sorry. I was reading threads about cash in a portfolio and came across dbr's post. He mentioned Poughkeepsie. I went to school there and lived in Wappingers Falls which is nearby. Couldn't resist. Did I c...
by dbr
Sat Apr 20, 2019 8:31 am
Forum: Personal Investments
Topic: Boglehead Philosophy - High Yield Dividend Funds
Replies: 16
Views: 1127

Re: Boglehead Philosophy - High Yield Dividend Funds

The Bh "philosophy" (if such a thing can be said to exist) is based on total return (yield + growth), minimizing expenses and taxes, and being well diversified. In general if you're investing in VHYAX you may not be fulfilling 2/3 of those goals, if not 3/3. Correct. If there is a BH philosophy her...
by dbr
Sat Apr 20, 2019 8:24 am
Forum: Personal Investments
Topic: Fun with FIRECalc
Replies: 20
Views: 1441

Re: Fun with FIRECalc

With a program like this one should always explore how sensitive the analysis is to variation in the inputs. I don't know that the result is surprising. It might be nice to know what was so unexpected. Note that this program can't parse fine differences at the successful end such as 1% failure, .1% ...
by dbr
Sat Apr 20, 2019 8:19 am
Forum: Personal Investments
Topic: Help calculating after tax yield
Replies: 8
Views: 366

Re: Help calculating after tax yield

...even better help me understand the concept so I can do it myself After-tax return will be r*(1-t), where r = before tax return t = tax rate applied to the income from that investment. Does that suffice? That would be correct. Fill out a tax return without any mention of your investments. Fill ou...
by dbr
Thu Apr 18, 2019 6:41 pm
Forum: Personal Finance (Not Investing)
Topic: ORP optimism
Replies: 9
Views: 918

Re: ORP optimism

I think that any time there are options for parameters to set on a model a good exercise is to run through a set of variations on those parameters to determine the effect on the outcome. That is called a sensitivity analysis that tells you how sensitive the result is to variations in assumptions. On...
by dbr
Thu Apr 18, 2019 6:16 pm
Forum: Personal Investments
Topic: What are the Pro’s and Con’s to Tips?
Replies: 7
Views: 869

Re: What are the Pro’s and Con’s to Tips?

In a high tax bracket with high income from investments one would usually seek to reduce tax cost by holding tax exempt investments. All Treasuries are state tax exempt but not Federal. It would seem TIPS are not necessarily a good idea in this case. Do you have an assessment that inflation risk is ...
by dbr
Thu Apr 18, 2019 6:12 pm
Forum: Personal Investments
Topic: Beginner Investor Questions
Replies: 14
Views: 1002

Re: Beginner Investor Questions

Funds that trade a lot internally due to active management or other reason can incur internal brokerage costs that are not reported in the ER. Those same funds can have larger capital gains distributions which may impose a tax cost. It is a good idea to avoid funds that have a lot of turnover. Funds...
by dbr
Thu Apr 18, 2019 9:21 am
Forum: Personal Finance (Not Investing)
Topic: Dealership vs independent mechanics
Replies: 23
Views: 1528

Re: Dealership vs independent mechanics

You might add that some warranties and recalls require that specific work be done at a dealer. Also some kinds of issues may not be doable at many, most, or all independent mechanics. Otherwise I think actually there is huge overlap between dealers and independents. There are some really bad actors ...
by dbr
Wed Apr 17, 2019 4:19 pm
Forum: Personal Investments
Topic: Capital Gains and Long Term Stock Holdings
Replies: 12
Views: 715

Re: Capital Gains and Long Term Stock Holdings

Yes, the first thought is that the basis was reset as of date of inheritance. The second thought is to actually tabulate the unrealized gains and losses for each stock by tax lot. Then you can figure out exactly what it is going to cost you to liquidate what.
by dbr
Tue Apr 16, 2019 4:52 pm
Forum: Personal Investments
Topic: New into small business and this forum - Need advice
Replies: 7
Views: 539

Re: New into small business and this forum - Need advice

Any investment these days compounds meaning the return each years applies to the total of what you had and what you earned the year before. The difference is how large the returns are on average and how much they vary. Risky investments like stocks can compound into a big loss just as well as into a...
by dbr
Tue Apr 16, 2019 8:54 am
Forum: Personal Finance (Not Investing)
Topic: Executor of Will - Selling House in Poor Condition
Replies: 80
Views: 5523

Re: Executor of Will - Selling House in Poor Condition

It seems to me selling as is would be the logical alternative to a costly and time consuming process to make the house habitable and up to code to put on the regular market. It does not seem anyone is prepared to invest the time and effort to do anything else. We had a similar case and handled it by...
by dbr
Tue Apr 16, 2019 8:20 am
Forum: Personal Finance (Not Investing)
Topic: Interviewing within corporation
Replies: 3
Views: 544

Re: Interviewing within corporation

The normal motivation for switching positions in a company is for advancement or for better position for advancement. If that is missing it isn't clear what your motivation is. Sometimes people move to an area that has better future business prospects hopefully avoiding a layoff. Ironically I never ...
by dbr
Mon Apr 15, 2019 7:45 pm
Forum: Personal Consumer Issues
Topic: Luxury car recommendations?
Replies: 90
Views: 6453

Re: Luxury car recommendations?

To me it is not, but if someone is happy driving a 10 year old cloth 4 cylinder Camry they should look closely at a current XLE V6 with modern safety features, navigation, leather, etc. It would be a big bump up from what they have and maybe they'd find the Lexus ES offers little additional value o...
by dbr
Mon Apr 15, 2019 6:00 pm
Forum: Personal Consumer Issues
Topic: Where To Get New Bikes
Replies: 64
Views: 3795

Re: Where To Get New Bikes

I would add that a LBS will also help getting the right size and fit. For kids that may be less important. For an adult road bike it matters a lot. I would be concerned that going to Craigslist for some bikes that you don't know how to fit correctly for yourself might be less appealing.
by dbr
Mon Apr 15, 2019 5:54 pm
Forum: Investing - Theory, News & General
Topic: What is your one favorite fixed income for retirement?
Replies: 45
Views: 5248

Re: What is your one favorite fixed income for retirement?

For me Social Security and a pension, both of which are fixed and income as opposed to fixed income which is neither. I don't have an answer whether I would buy an SPIA if there were no pension income, but people should always be aware of such things. But more seriously I can't see a rationale for a...
by dbr
Mon Apr 15, 2019 5:46 pm
Forum: Investing - Theory, News & General
Topic: What TIPS yield is equivalent to 4% SWR but guarantees 30 year portfolio survival?
Replies: 30
Views: 2764

Re: What TIPS yield is equivalent to 4% SWR but guarantees 30 year portfolio survival?

Now that the arithmetic is done, it helps me visualize parts of an entire puzzle... If current 30 year TIPS ladder average yield corresponds to 3.6% withdrawal and I use 66% of my portfolio to build one. Say I can increase stock exposure on the remaining 34% and have a SWR of 4.2%, then the average...
by dbr
Mon Apr 15, 2019 9:30 am
Forum: Personal Consumer Issues
Topic: Reading Glasses With Bluelight Filter
Replies: 7
Views: 479

Re: Reading Glasses With Bluelight Filter

I have separate computer and reading glasses. The computer glasses are simply less strong because they work for a longer focal length (in my case, readers = +1.50 and computer glasses = +0.75). Flexies are an inexpensive, color coded choice for me (lots of color options). https://www.speert.com/cal...
by dbr
Mon Apr 15, 2019 9:29 am
Forum: Personal Investments
Topic: Shifting away from 100% stocks - how do you execute shift without timing?
Replies: 17
Views: 1145

Re: Shifting away from 100% stocks - how do you execute shift without timing?

No, you should not attempt to time this path to a more conservative allocation. In my opinion you are exaggerating the magnitude of the shift. 80/20 is not very different from 100/0. In any case you can devise a pathway to follow by gradual steps. An example of that is the glide path for target reti...
by dbr
Mon Apr 15, 2019 9:24 am
Forum: Personal Investments
Topic: If you have plenty of money, why not 100% stocks in retirement?
Replies: 107
Views: 6948

Re: If you have plenty of money, why not 100% stocks in retirement?

In the end there is always a balance between the overall chances of higher return and more wealth against greater uncertainty as to what will actually happen. 100% stocks is one extreme of that trade-off and like all extremes is not likely to be preferred by very many people. That is why not.
by dbr
Mon Apr 15, 2019 9:06 am
Forum: Personal Investments
Topic: Wellesley Income fund Admiral
Replies: 17
Views: 2592

Re: Wellesley Income fund Admiral

These recommendations are changing his asset allocation quite a bit. Wellesley is 63% bonds and 37% stock. Not sure if he wants to change to all stocks. Yes, what is missing is discussion of where all the rest of a person's money is invested. The issue should be about tax efficient fund location af...
by dbr
Mon Apr 15, 2019 9:02 am
Forum: Personal Investments
Topic: Increasing Risk in Retirement
Replies: 26
Views: 2121

Re: Increasing Risk in Retirement

In referring to early retirement I meant in the early 'part' of my retirement (e.g., from 61 to 71 yo). Also, when I refer to risk, I do mean risk of running out of money. Really only concerned with downside risk - not risk of leaving too much $$ to children (good but not necessary). The question f...
by dbr
Mon Apr 15, 2019 8:36 am
Forum: Personal Investments
Topic: Increasing Risk in Retirement
Replies: 26
Views: 2121

Re: Increasing Risk in Retirement

The problem I see with a variable and bidirectional AA on the basis of "what if's" is getting whip-sawed with higher than expected returns in earlier retirement when one has less equity exposure followed by lower than expected returns when one has increased risk. I'm exceeding comfortable with risk...
by dbr
Mon Apr 15, 2019 8:33 am
Forum: Personal Investments
Topic: Retirement Planning with Pension
Replies: 18
Views: 2010

Re: Retirement Planning with Pension

Some people think of pension as a bond equivalent and adjust their asset allocation accordingly. The difficulty I have with calculating how to include a pension in retirement planning is that before the pension starts being paid out, it can be tough to estimate the pension's value. In some cases, t...
by dbr
Mon Apr 15, 2019 8:25 am
Forum: Personal Consumer Issues
Topic: Where To Get New Bikes
Replies: 64
Views: 3795

Re: Where To Get New Bikes

Also, some LBS are aimed at an enthusiast/racer clientele and some at family bikes. It is pretty easy to see what they have in the window to distinguish one from the other.
by dbr
Mon Apr 15, 2019 8:23 am
Forum: Personal Consumer Issues
Topic: Reading Glasses With Bluelight Filter
Replies: 7
Views: 479

Re: Reading Glasses With Bluelight Filter

I have two kinds of reading glasses. One is $5.95 from Amazon that I buy six pairs at a time. They actually have held up OK but a couple have gone in the trash. They did come in a nice case, fit well, and have a good size lens. The other is a multi-hundred dollar pair of prescription reading glasses...
by dbr
Mon Apr 15, 2019 8:19 am
Forum: Personal Consumer Issues
Topic: Where To Get New Bikes
Replies: 64
Views: 3795

Re: Where To Get New Bikes

An advantage of a local bike shop is (or should be) good service and repair. These things are fairly easy DIY but no bike, especially maybe a kids bike, should go without annual maintenance even if just making sure everything is tight and not out of line. Cleaning and lubricating is important.
by dbr
Mon Apr 15, 2019 8:13 am
Forum: Investing - Theory, News & General
Topic: What TIPS yield is equivalent to 4% SWR but guarantees 30 year portfolio survival?
Replies: 30
Views: 2764

Re: What TIPS yield is equivalent to 4% SWR but guarantees 30 year portfolio survival?

Second question...if 1.31% is “equivalent” to 4% and 0% is “equivalent” to 3.33% SWR, how does one calculate the “equivalent” for various TIPS yield. For instance take 0.6% yield, what “SWR” will make this last 30 years? I think I used the PMT function to do this. RATE does the same math. The answe...
by dbr
Mon Apr 15, 2019 8:02 am
Forum: Personal Investments
Topic: My advisor VS Vanguard's PAS
Replies: 70
Views: 4578

Re: My advisor VS Vanguard's PAS

The last time I asked for thoughts on Social Security claiming strategies. I entered the PIA and ages of myself and spouse, our plans on how long to work, etc. The CFP did not seem to have looked at the information and just said spouse should claim as soon as possible. No indication of a calculatio...
by dbr
Mon Apr 15, 2019 7:59 am
Forum: Personal Investments
Topic: Increasing Risk in Retirement
Replies: 26
Views: 2121

Re: Increasing Risk in Retirement

Does it make sense in early retirement to minimize risk in the first several years and then barring unforeseen and early consequential downturns, increase risk as the impact of downturns has less overall impact on the portfolio? Minimize risk of what? In general the meaning of risk is impact on the...