Search found 1011 matches

by zeugmite
Fri Jul 13, 2018 3:47 pm
Forum: Investing - Theory, News & General
Topic: International Stock and Currency Issues
Replies: 41
Views: 2778

Re: International Stock and Currency Issues

Currency risk is bounded by Purchasing Power Parity (PPP) and thus mean reverting. Due to the mean reverting tendencies of Purchasing Power Parity, Dimson, Marsh and Staunton have pointed out that, over the long haul, currencies essentially reflect relative inflation rates (chart below). For long-t...
by zeugmite
Mon Jul 02, 2018 2:37 pm
Forum: Investing - Theory, News & General
Topic: Treasury Direct website down all day (7/1)
Replies: 23
Views: 1776

Re: Treasury Direct website down all day (7/1)

Stuff goes down, bank websites go down too. Can't imagine a situation (especially for heirs) where paper is more convenient (or for that matter, more liquid) than electronic in transactions. Heck, most physical banks don't even open on weekends.
by zeugmite
Mon Jul 02, 2018 2:32 pm
Forum: Investing - Theory, News & General
Topic: Vanguard to offer non-Vanguard ETFs commission-free
Replies: 124
Views: 9329

Re: 1800 Commission-Free ETFs

I wonder how this gets paid for. Fund supermarket access fees by providers? Payment for order flow? Internalization, i.e. market-making (most likely)?
by zeugmite
Thu Jun 28, 2018 4:04 pm
Forum: Personal Finance (Not Investing)
Topic: Using Plastiq? [Payment service]
Replies: 34
Views: 7393

Re: Using Plastiq?

3 payment attempts through Plastiq with the so-called fee dollars have been a miserable failure. The first attempt was charged and automatically cancelled 2 days later - only the statement closed in between those dates. The second time, Plastiq claims to have mailed a check on 7/14. By 8/1, after t...
by zeugmite
Thu Jun 14, 2018 1:35 pm
Forum: Investing - Theory, News & General
Topic: Why market drop when Fed announced rate increase?
Replies: 19
Views: 2576

Re: Why market drop when Fed announced rate increase?

I would like to know what factors it will take for 10-year treasury yield to get over 3% and actually stay there. Everyone seemed to predict the last time the FFR was raised that might do it, but it wasn't enough. Long-term rates are influenced by growth prospects and inflation expectation. Raising...
by zeugmite
Wed Jun 13, 2018 4:18 pm
Forum: Investing - Theory, News & General
Topic: Why market drop when Fed announced rate increase?
Replies: 19
Views: 2576

Re: Why market drop when Fed announced rate increase?

Futures markets were pricing in between 3 to 4 interest rate hikes this year. The Fed now project 4 this year (more than markets anticipated) and generally moving up the timetable of hikes. Prices are adjusting to this news.
by zeugmite
Tue May 29, 2018 5:16 pm
Forum: Personal Finance (Not Investing)
Topic: What happens when car accident claim exceeds insurance limits?
Replies: 89
Views: 75594

Re: What happens when car accident claim exceeds insurance limits?

Generally, is there any reason to get liability coverage beyond your assets less exemptions? I guess you have to factor in the cost of bankruptcy and moral obligations, etc., but financially is that the rational extent to which one should be insured? (Saw some earlier posts mentioning being insured...
by zeugmite
Tue May 29, 2018 5:13 pm
Forum: Personal Finance (Not Investing)
Topic: What happens when car accident claim exceeds insurance limits?
Replies: 89
Views: 75594

Re: What happens when car accident claim exceeds insurance limits?

If you're responsible the other party could to go after you for the rest. That's why we have umbrella policies. Can they accept the settlement from the insurance company (up to policy limits) and then hold you personally liable for the rest? Or do they have to take one or the other? They have to ta...
by zeugmite
Tue May 29, 2018 5:04 pm
Forum: Personal Finance (Not Investing)
Topic: What happens when car accident claim exceeds insurance limits?
Replies: 89
Views: 75594

Re: What happens when car accident claim exceeds insurance limits?

Generally, is there any reason to get liability coverage beyond your assets less exemptions? I guess you have to factor in the cost of bankruptcy and moral obligations, etc., but financially is that the rational extent to which one should be insured? (Saw some earlier posts mentioning being insured ...
by zeugmite
Tue May 29, 2018 4:26 pm
Forum: Personal Finance (Not Investing)
Topic: What happens when car accident claim exceeds insurance limits?
Replies: 89
Views: 75594

Re: What happens when car accident claim exceeds insurance limits?

Consider this: 13 years ago, I was an at fault driver for a car accident. Put the other driver in the ICU for 5 days, plus unknown additional days after that. He had previously had a heart transplant and his heart started to act up again. Vision issues due to shattered glass. He was a stock broker ...
by zeugmite
Tue May 29, 2018 2:22 pm
Forum: Investing - Theory, News & General
Topic: China and EM [Emerging Market]
Replies: 30
Views: 3453

Re: China and EM

I'm not understanding how, even with a transition index, the front-running can be avoided. The end target is the same, so the stocks being picked up are known. It might avoid some short-term front-runners, but let's say the transition is over six months, then you'd still get front-run by investors w...
by zeugmite
Mon Mar 05, 2018 3:46 pm
Forum: Investing - Theory, News & General
Topic: Is Now the Time to Reduce Bond Duration?
Replies: 41
Views: 4613

Re: Is Now the Time to Reduce Bond Duration?

Templeton was trying to predict the peak in interest rates in 1993. He was wrong. For the ensuing five years five year treasuries provided annualized nominal total returns of 6.3% (3.9% real). After looking at the landscape over the prior five years I observed that the 1982-? bond bull market looke...
by zeugmite
Thu Feb 15, 2018 12:50 pm
Forum: Investing - Theory, News & General
Topic: Muni Money Market funds starting to look good!
Replies: 139
Views: 25700

Re: Muni Money Market funds starting to look good!

ohai wrote:
Wed Dec 27, 2017 2:37 pm
Also, if you believe in market risk premium, whatever your alternative investment was when rates were lower should have similar excess return to what they had when interest rates were lower.
Risk premium isn't static. It is in the processing of increasing but it's very low still.
by zeugmite
Tue Feb 13, 2018 7:23 pm
Forum: Investing - Theory, News & General
Topic: In plain English, please explain what was VIX, what happened to it and why?
Replies: 68
Views: 6498

Re: In plain English, please explain what was VIX, what happened to it and why?

livesoft wrote:
Tue Feb 13, 2018 7:19 pm
Is volility different from volatility? That's where I am confused.
lol, I think he meant volatility.
by zeugmite
Mon Feb 12, 2018 9:55 pm
Forum: Investing - Theory, News & General
Topic: I think US interest rates could drop.
Replies: 62
Views: 7301

Re: I think US interest rates could drop.

I think the question to ask is, is 0.5% real a good yield? Maybe, maybe not. Real GDP growth is higher than that right now even by lowball estimates, but maybe retirees decide to withhold consumption and demand collapses, or maybe automation will drive productivity through the roof. And 2.8% nominal...
by zeugmite
Fri Feb 09, 2018 1:21 am
Forum: Investing - Theory, News & General
Topic: Why Weak Dollar, after likely four future interest rate hike?
Replies: 8
Views: 1189

Re: Why Weak Dollar, after likely four future interest rate hike?

We can't look forward but we can look back. When the US lifted off with Fed funds rates was when the USD stopped appreciating. It stayed constant for a while, then soon after the election, began its current downward move. What could that mean? It seems the first part is classic economics, rising US ...
by zeugmite
Thu Feb 08, 2018 10:45 pm
Forum: Investing - Theory, News & General
Topic: Volatility as a cause of volatility?
Replies: 18
Views: 1364

Re: Volatility as a cause of volatility?

I doubt serious institutionals are using sort-of-hedged retail products like XIV (I mean maybe they are...), but I would expect more like advisors or boutique funds to be using it instead of putting on their own hedges or working bespoke contracts with banks and insurance counterparties. As for vola...
by zeugmite
Thu Feb 08, 2018 5:25 pm
Forum: Investing - Theory, News & General
Topic: S&P 1550
Replies: 11
Views: 1654

Re: S&P 1550

It would take a pretty big bear mauling. However, if you go back and look at the parabolic rise from 5 years ago it seems almost probable. 1800 would be a tough nut to crack through. Perhaps years and years of slow market declines? Me thinks 2800 was the top, perhaps a retest on a meltup. I don't k...
by zeugmite
Wed Feb 07, 2018 11:05 pm
Forum: Investing - Theory, News & General
Topic: The yield curve inverted (a tiny bit) on 1/30
Replies: 2
Views: 614

The yield curve inverted (a tiny bit) on 1/30

In all the noise, did anyone notice that on 1/30, the 1 mo-3 mo spread on Treasury bills turned slightly negative?

Date 1/30/18
1 Mo 1.49
3 Mo 1.44
6 Mo 1.66
1 Yr 1.88
2 Yr 2.13
3 Yr 2.27
5 Yr 2.51
7 Yr 2.65
10 Yr 2.73
20 Yr 2.86
30 Yr 2.98
by zeugmite
Wed Feb 07, 2018 6:10 pm
Forum: Investing - Theory, News & General
Topic: Why Weak Dollar, after likely four future interest rate hike?
Replies: 8
Views: 1189

Re: Why Weak Dollar, after likely four future interest rate hike?

Perhaps the market doesn't believe these rates (even with 3-4 hikes) are attractive enough given the fiscal situation. At some even higher rates the buyers will come.

Having said that, hasn't the dollar been gaining on EUR the last few days?
by zeugmite
Wed Feb 07, 2018 2:28 pm
Forum: Investing - Theory, News & General
Topic: Why should we care about inflation?
Replies: 58
Views: 5661

Re: Why should we care about inflation?

With most of my net worth in stocks, I don't worry about inflation at all. This isn't entirely true either. Inflation may induce policy mistakes (over tightening or loss of control) and credit deterioration for holders of fixed-rate assets and floating-rate liabilities (e.g. banks) and end up costi...
by zeugmite
Wed Feb 07, 2018 1:17 pm
Forum: Investing - Theory, News & General
Topic: Why should we care about inflation?
Replies: 58
Views: 5661

Re: Why should we care about inflation?

It's not inflation you should care about, it's how things are priced relative to future inflation that is the problem. Things are not priced for any inflation. 1. The value of your house goes down, less home equity (see VNQ recently), at least in the short term. 2. You may not carry debt, but you ow...
by zeugmite
Wed Feb 07, 2018 2:46 am
Forum: Investing - Theory, News & General
Topic: Return of stock market is better overnight than during the day - NYTimes article
Replies: 19
Views: 2791

Re: Return of stock market is better overnight than during the day - NYTimes article

TDA already touts 24/5 trading and for things like SPY, the spread is small even in the middle of the night. Not sure who the market maker is.
by zeugmite
Wed Feb 07, 2018 1:40 am
Forum: Investing - Theory, News & General
Topic: Inverse VIX ETN down 80% after hours
Replies: 42
Views: 5646

Re: Inverse VIX ETN down 80% after hours

Sorry for asking a dumb question, but will do so anyway...I kind of get it that those who purchased the Inverse VIX made money as long as the stock market was non-volatile. My question is - who was on the losing side of that trade the last year or so when in fact the market was pretty placid? Did w...
by zeugmite
Wed Feb 07, 2018 12:11 am
Forum: Investing - Theory, News & General
Topic: Return of stock market is better overnight than during the day - NYTimes article
Replies: 19
Views: 2791

Re: Return of stock market is better overnight than during the day - NYTimes article

The return during the day was a loss (-4.4%), so more than 100% of the gains happened when the market was closed. How much more pronounced could it be? By comparison the NYSE trades about 18% of the time so if it was purely a matter of time you'd expect 18% of the gains during the day. Ah sorry, di...
by zeugmite
Tue Feb 06, 2018 11:45 pm
Forum: Investing - Theory, News & General
Topic: Return of stock market is better overnight than during the day - NYTimes article
Replies: 19
Views: 2791

Re: Return of stock market is better overnight than during the day - NYTimes article

News happens every hour globally. There are more hours outside market hours. I'd actually expect the difference to be more pronounced if markets were efficient. (I guess there are longitudes on the globe where nobody lives so they have no news happening during their "day" there, so you have to accou...
by zeugmite
Tue Feb 06, 2018 11:34 pm
Forum: Investing - Theory, News & General
Topic: Inverse VIX ETN down 80% after hours
Replies: 42
Views: 5646

Re: Inverse VIX ETN down 80% after hours

You would need a lot of money and the ability to day trade to really profit from these derivative/inverse derivative-based products. Super high expense ratios, all based on the good faith of the issuing company (aka they can one day say whoops, we lost everything.) Not worth it for average/intermed...
by zeugmite
Tue Feb 06, 2018 11:10 pm
Forum: Investing - Theory, News & General
Topic: Inverse VIX ETN down 80% after hours
Replies: 42
Views: 5646

Re: Inverse VIX ETN down 80% after hours

You would need a lot of money and the ability to day trade to really profit from these derivative/inverse derivative-based products. Super high expense ratios, all based on the good faith of the issuing company (aka they can one day say whoops, we lost everything.) Not worth it for average/intermed...
by zeugmite
Tue Feb 06, 2018 2:39 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 6683
Views: 1450719

Re: U.S. stocks in freefall

Might be from emerging markets which is up 2%. VWO is up nearly 2%, but VEMAX will be down substantially today, as the discount to NAV on the ETF has reversed to a premium today. VSS is the same, but even more dramatic. VSS closed ($117.14) at a substantial discount to NAV ($118.47) yesterday, even...
by zeugmite
Tue Feb 06, 2018 10:19 am
Forum: Investing - Theory, News & General
Topic: Merrill Lynch site crashed today (VG fine)
Replies: 20
Views: 1568

Re: Merrill Lynch site crashed today (VG fine)

Well, damn. I can't log into Merrill Edge right now: "We are sorry, an error occurred while trying to retrieve your data. Please try again later." ME login works fine for me, as does Scottrade. Now it works for me too. Same with Fidelity. I guess all of them are getting hammered by retail investors...
by zeugmite
Tue Feb 06, 2018 10:05 am
Forum: Investing - Theory, News & General
Topic: Merrill Lynch site crashed today (VG fine)
Replies: 20
Views: 1568

Re: Merrill Lynch site crashed today (VG fine)

Well, damn. I can't log into Merrill Edge right now: "We are sorry, an error occurred while trying to retrieve your data. Please try again later." Fidelity also looks down: "Internal Server Error - Read The server encountered an internal error or misconfiguration and was unable to complete your requ...
by zeugmite
Tue Feb 06, 2018 12:40 am
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 6683
Views: 1450719

Re: U.S. stocks in freefall

At this point, I think many are making too big of a deal about this downturn. Way back in the old days, the S&P 500 dropped nearly 13% between Nov., 2015, and Feb., 2016. There was almost a 12% decline from July to August in 2015 as well. When it comes to stocks, volatility is the norm . The almost...
by zeugmite
Mon Feb 05, 2018 11:57 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 6683
Views: 1450719

Re: U.S. stocks in freefall

Here's the Good News -- J. Siegel says the market is cha-ching. What a difference a couple days makes, eh? Jeremy Siegel almost never gives a one-year forecast for stocks, but last week he predicted that U.S. equities will end the year with gains of as much as 10%. So now does he believe US equitie...
by zeugmite
Mon Feb 05, 2018 11:29 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 6683
Views: 1450719

Re: U.S. stocks in freefall

Up? That’d be pretty crazy considering the Dow and S&P futures are indicating the market is down more now than it was on Monday during regular trading hours. Although granted, that doesn't mean very much. It's just continuous trading, which may or may not find a bottom even when the US market isn't...
by zeugmite
Mon Feb 05, 2018 11:21 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 6683
Views: 1450719

Re: U.S. stocks in freefall

I won’t guess about what kind of leaking into returns occurred but according to this last round of earnings reports, underlying businesses are strong and are expected to continue to be strong. Banks are also much stronger than they were last time and despite high debt levels there does not appear t...
by zeugmite
Mon Feb 05, 2018 9:56 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 6683
Views: 1450719

Re: U.S. stocks in freefall

quantAndHold wrote:
Mon Feb 05, 2018 9:48 pm
The drop is entirely my fault. I’ve been DCAing a large sum into stocks over the last year. I just moved the last chunk into the stock market last week. :oops:
In your case, should've lump summed :wink:
by zeugmite
Mon Feb 05, 2018 9:35 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 6683
Views: 1450719

Re: U.S. stocks in freefall

I'm not so sure that valuations are relevant here. EM has been falling in lock-step with US stocks, and there's a pretty broad consensus that EM stocks are not as expensive. I share your concerns about valuations, and would love to see some of the excess unwind. But I'm not convinced that this is d...
by zeugmite
Mon Feb 05, 2018 9:21 pm
Forum: Investing - Theory, News & General
Topic: CAPE Fear: Why CAPE Naysayers Are Wrong
Replies: 125
Views: 11287

Re: Cape Fear: Do you feel vindicated?

The current downturn smells more like a flash crash to me, but obviously I don't know. Edit: I just saw that Cramer thinks this is a flash crash too. Interesting. There is something you discover even in a flash crash, which is to say where the bids start to appear. From a buyer's perspective, that'...
by zeugmite
Mon Feb 05, 2018 9:18 pm
Forum: Investing - Theory, News & General
Topic: CAPE Fear: Why CAPE Naysayers Are Wrong
Replies: 125
Views: 11287

Re: CAPE Fear: Why CAPE Naysayers Are Wrong

nedsaid wrote:
Mon Feb 05, 2018 9:16 pm
Forward P/E's of the US Total Stock Market Index, at least as measured by the Fidelity product are about 20. They had crept up to almost 22. That seems more reasonable valuations.
Isn't forward P/E all garbage and guesses?
by zeugmite
Mon Feb 05, 2018 9:01 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 6683
Views: 1450719

Re: U.S. stocks in freefall

First, markets do awfully weird things for no apparent reason. I see absolutely no logic in the market dropping over 600 points on Friday and over 1,100 points the next Monday. Really, what has changed in the last couple of weeks? Not much. What changed was that a long-standing correlation structur...
by zeugmite
Mon Feb 05, 2018 8:37 pm
Forum: Investing - Theory, News & General
Topic: Inverse VIX ETN down 80% after hours
Replies: 42
Views: 5646

Re: Inverse VIX ETN down 80% after hours

Somebody might be having liquidity issues, the TIPS ETF, TIP, records -1.87% in after-hours trading on Yahoo. Might be data error though.
by zeugmite
Mon Feb 05, 2018 8:17 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks in freefall
Replies: 6683
Views: 1450719

Re: U.S. stocks in freefall

Let the short VIX speculators have their fun (or misery) but that activity doesn't mean anything with respect to underlying intrinsic value or market fundamentals. Actually it might. The VIX contracts were probably hedged with underlying, and leaking into prior returns elsewhere (and thus causing c...
by zeugmite
Mon Feb 05, 2018 6:39 pm
Forum: Investing - Theory, News & General
Topic: Inverse VIX ETN down 80% after hours
Replies: 42
Views: 5646

Inverse VIX ETN down 80% after hours

The article talks about XIV, an ETN by Credit Suisse. The VelocityShares Daily Inverse VIX Short-Term exchange-traded note (XIV) is down more than 80 percent in extended trading. The security, issued by Credit Suisse, is supposed to give the opposite return of the Cboe Volatility index (VIX), the ma...
by zeugmite
Mon Feb 05, 2018 3:10 pm
Forum: Investing - Theory, News & General
Topic: Now we know what yields the market can handle
Replies: 0
Views: 340

Now we know what yields the market can handle

2.85% on the 10 year, 3.10% on the 30 year.
by zeugmite
Mon Feb 05, 2018 2:04 pm
Forum: Investing - Theory, News & General
Topic: why are people saying there is bond issues. BND only down 2% YTD
Replies: 29
Views: 3243

Re: why are people saying there is bond issues. BND only down 2% YTD

You are conflating the fed funds rate (the rate being raised by the fed) with the rates on intermediate term bonds with an average duration of 6 years. An increase in the fed funds rate does not necessarily result in an increase in intermediate bond rates, although the fed's actions are likely to h...
by zeugmite
Sun Feb 04, 2018 10:02 pm
Forum: Investing - Theory, News & General
Topic: Alan Greenspan says there are bubbles in both stocks and bonds
Replies: 87
Views: 8676

Re: Alan Greenspan says there are bubbles in both stocks and bonds

If interest rates keep rising we might be in for a period of time where a Total Bond holding stays almost flat and loses a little every year to inflation. Or not, since interest rate forecasts have always been grotesquely unreliable. There's nothing here to scare a bond fund holder into making any ...
by zeugmite
Sun Feb 04, 2018 9:31 pm
Forum: Investing - Theory, News & General
Topic: Recovering from a "draw down" on 7-10 year US Treasuries
Replies: 15
Views: 1772

Re: Recovering from a "draw down" on 7-10 year US Treasuries

Here's a previous discussion on roll return: https://www.bogleheads.org/forum/viewtopic.php?t=205138 Thanks again. I [think I] understand the concept of the Roll Yield; and that works better the steeper the yield curve is [my understanding]. The roll yield could be a factor with the 7-year bonds as...