Search found 365 matches

by Solo Prosperity
Mon Jun 18, 2018 3:40 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Rediscovering The Size Effect
Replies: 36
Views: 3626

Re: Larry Swedroe: Rediscovering The Size Effect

. Using 1927-2017 data from Ken French’s website... Wanted to add 3 things: 1. The size effect is not linear like most other commonly accepted factors. From 1927-2017, the best decile measured by performance was the 10th (Smallest) decile (Good start). The second best decile was the 8th (3rd smalle...
by Solo Prosperity
Sun May 20, 2018 10:36 pm
Forum: Investing - Theory, News & General
Topic: Does your value fund own the wrong value stocks?
Replies: 25
Views: 3078

Re: Does your value fund own the wrong value stocks?

Full Disclosure: I invest a small portion of my investments in a 25 stock value portfolio... If you think that your value fund owns the wrong stocks, I would suggest finding a new value fund. There are plenty out there that all use different metrics to measure "value". Despite how important the Fam...
by Solo Prosperity
Fri May 11, 2018 9:53 pm
Forum: Investing - Theory, News & General
Topic: Agressive factor Investing
Replies: 44
Views: 4320

Re: Agressive factor Investing

TM90. SC Momentum is an expensive way to get size and momentum exposure. I don't think you necessarily need SCM exposure. As Bernstein says, "What matters is factor exposure and expenses". Find the factors you believe in and build a low-cost portfolio around that. You do not exposure to every factor...
by Solo Prosperity
Thu Apr 19, 2018 7:31 pm
Forum: Personal Finance (Not Investing)
Topic: IRA rollover to 401k question
Replies: 22
Views: 1450

Re: IRA rollover to 401k question

If that is the case -then I should keep the $8000 in the tIRA (roll the rest to 401K) --then move the $8,000 into a Roth IRA ? Then going forward I can make non-deductible contributions each year into tIRA and then move to Roth IRA ? That is what I would do. Again, just be very sure you can roll yo...
by Solo Prosperity
Thu Apr 19, 2018 3:52 pm
Forum: Personal Finance (Not Investing)
Topic: IRA rollover to 401k question
Replies: 22
Views: 1450

Re: IRA rollover to 401k question

If you filed a form 8606 AND your new plan accepts rollovers, you are correct. Roll the deductible portion into the plan and convert the non-deductible basis portion into a rIRA (Your basis on line 14 of your most recent 8606, assumming you have filed them all). Double check all of the rules around ...
by Solo Prosperity
Wed Apr 18, 2018 6:26 pm
Forum: Investing - Theory, News & General
Topic: Your Money Or Your Life
Replies: 49
Views: 7049

Re: Your Money Or Your Life

FIRE is a bit of a mirage imo. Most people that FIRE really just want to Retire Early form their current job. Most people who FIRE still seem to do some level of work that produces income. I think the Financial Independence portion is a great goal, but the emphasis on Retiring Early seems to be more...
by Solo Prosperity
Mon Apr 09, 2018 3:51 pm
Forum: Investing - Theory, News & General
Topic: The Two Fund Portfolio
Replies: 34
Views: 5642

Re: The Two Fund Portfolio

OP has proposed using a multifactor global fund as the entire equity portion of a person’s portfolio. I have a few questions to help evaluate the proposal: (1.a.) Do you think a factor-tilted portfolio should have any exposure to market beta? (1.b.) If so, how much? (2.) To what extent is OP’s curr...
by Solo Prosperity
Fri Apr 06, 2018 12:29 am
Forum: Investing - Theory, News & General
Topic: Bill Bernstein, new podcast
Replies: 56
Views: 6473

Re: Bill Bernstein, new podcast

VictoriaF wrote:
Thu Apr 05, 2018 1:45 pm
Why can't Bill recommend specific fund companies?
Dr. Bernstein owns/runs a RIA. He is an investment manager and so publicly promoting fund companies is a compliance no-no.
by Solo Prosperity
Wed Mar 28, 2018 11:49 pm
Forum: Investing - Theory, News & General
Topic: Is technical analysis all smoke and mirrors?
Replies: 62
Views: 5578

Re: Is technical analysis all smoke and mirrors?

I personally believe that trend-following has a lot of merit to it (I have never bought into making investment decision on chart patterns but to each their own). For 3 years in the mid-2000s I tried "trend following" with a guy who had a large following and claimed he had made a lot of money doing ...
by Solo Prosperity
Wed Mar 28, 2018 12:05 am
Forum: Investing - Theory, News & General
Topic: Is technical analysis all smoke and mirrors?
Replies: 62
Views: 5578

Re: Is technical analysis all smoke and mirrors?

Truth is, whatever keeps you disciplined to a long-term strategy, is fine by me. I personally believe that trend-following has a lot of merit to it (I have never bought into making investment decision on chart patterns but to each their own). It's a very un-boglehead stance to take, but having some ...
by Solo Prosperity
Tue Mar 27, 2018 11:54 pm
Forum: Investing - Theory, News & General
Topic: What would you do if you were in charge of a State Pension Fund?
Replies: 36
Views: 2278

Re: What would you do if you were in charge of a State Pension Fund?

I would be a little active. I would say 75% of the funds would go into a globally diversified portfolio (Global stocks, global bonds, global real assets) with cost-effective factor tilts (Beta, Size, Value, Momentum, Trend etc.). The remaining 25% would go into private real estate, pe, vc, etc. with...
by Solo Prosperity
Tue Mar 13, 2018 3:51 pm
Forum: Investing - Theory, News & General
Topic: Who's doing 100% international equity?
Replies: 79
Views: 9414

Re: Who's doing 100% international equity?

Not 100% ex-US and I don't think I will ever be 100% any asset class, but at the start of 2016 I moved from 60/30/10 US/DM/EM (Pretty Standard) to 30/30/40 US/DM/EM (Not so standard). This what done for valuation reasons and I plan to keep this allocation for the time being and am going on year 3 no...
by Solo Prosperity
Mon Feb 26, 2018 12:44 pm
Forum: Investing - Theory, News & General
Topic: Stock/Bond Ratio Determines Risk: Flawed Thesis?
Replies: 34
Views: 2770

Re: Stock/Bond Ratio Determines Risk: Flawed Thesis?

Buffett's thesis, from a technical perspective, is right, but one should be careful when applying it to a personal situation. There are couple things to point out: 1. Buffett may not hold bonds, or recommend them, but he does hold cash. He currently has around 20% of it actually. To me, this is esse...
by Solo Prosperity
Mon Feb 05, 2018 12:33 pm
Forum: Investing - Theory, News & General
Topic: Dual Momentum Investing
Replies: 228
Views: 44618

Re: Dual Momentum Investing

I am a 55 year old still working in the Tech Industry. After a couple of months of research I took a plunge and implemented “Dual Momentum”. I have convinced myself enough that I have put 100% of my tax sheltered as well as taxable liquid assets to use this method . It has been about four months si...
by Solo Prosperity
Tue Jan 16, 2018 11:48 pm
Forum: Investing - Theory, News & General
Topic: Emerging Markets equities went sideways for 50 years 1920-70
Replies: 24
Views: 2417

Re: Emerging Markets equities went sideways for 50 years 1920-70

The US in "Price Only" terms (Like the EM Chart) has done that a number of times...

From the same slides:

Image
by Solo Prosperity
Mon Jan 08, 2018 3:26 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Patience And Diversification Crucial
Replies: 51
Views: 7212

Re: Larry Swedroe: Patience And Diversification Crucial

. The word 'multifactor' seems to have different meanings to different people, confused further by financial industry 'marketing'. Multifactor is simply more than one factor (multi = more than one). By extension - large cap value and small cap are multi-factor (exposure to two 'risk factors' each),...
by Solo Prosperity
Mon Jan 08, 2018 1:32 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Patience And Diversification Crucial
Replies: 51
Views: 7212

Re: Larry Swedroe: Patience And Diversification Crucial

It leads me wonder if multi-factor funds aren't rather like active managed ones in that some will outperform in a particular environment during a particular time, but it's difficult to choose them in advance. The problem of course is the varying factor exposures of these new multi-factor funds. One...
by Solo Prosperity
Thu Jan 04, 2018 4:41 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Patience And Diversification Crucial
Replies: 51
Views: 7212

Re: Larry Swedroe: Patience And Diversification Crucial

Certainly international and value investors have required patience over the last decade. For the former that patience is finally being rewarded but for the latter the waiting continues. Small value relative to market has been positive over last 10 years for both Intl and US markets. 10 year annuali...
by Solo Prosperity
Thu Dec 28, 2017 12:36 pm
Forum: Investing - Theory, News & General
Topic: What ever happened to the Larry portfolio?
Replies: 120
Views: 13709

Re: What ever happened to the Larry portfolio?

The Larry Portfolio is an extremely niche portfolio, one that even Larry would say very few investors should try and replicate. It is based purely on the deep belief in the small + value premiums. The value premium has been pretty non-existent since ~2011, so it is no wonder that a value titled, sho...
by Solo Prosperity
Wed Dec 20, 2017 1:14 am
Forum: Investing - Theory, News & General
Topic: Momentum: the unfortunate difference between theory and practice
Replies: 7
Views: 1644

Re: Momentum: the unfortunate difference between theory and practice

I'm so thankful that Research Affiliates is always around to "save" a factor from its demise. I really like their research, but man, they sure as hell like to self promote how smart and awesome they are. I think they have "saved" 4 factors in the last year... :oops:
by Solo Prosperity
Tue Dec 19, 2017 5:45 pm
Forum: Investing - Theory, News & General
Topic: Paul Merriman and Small Cap Value
Replies: 137
Views: 15155

Re: Paul Merriman and Small Cap Value

TSM has wide diversification and rock bottom cost... Rock bottom cost, yes (Although most factor ETFs are in the 0.15%-0.25% range these days so the margin has slimmed). Diversification, ehhh. Beta diversification sure, but the absence of factor diversification is what makes TSM appealing to a lot ...
by Solo Prosperity
Tue Dec 19, 2017 1:36 pm
Forum: Investing - Theory, News & General
Topic: Paul Merriman and Small Cap Value
Replies: 137
Views: 15155

Re: Paul Merriman and Small Cap Value

The problem with all of these "Value Tilt Only" portfolios by Merriman, Swedroe, Bernstein, DFA, etc. is that they become extremely risky, from both a return (Sequence) and emotional perspective. I believe in Value over the long-term but we have more than enough evidence to show us that any single "...
by Solo Prosperity
Tue Dec 12, 2017 3:42 pm
Forum: Investing - Theory, News & General
Topic: Small cap value vs. total market?
Replies: 105
Views: 14783

Re: Small cap value vs. total market?

Mean Reversion seems to be a force in our world within and outside of investing. The problem with Mean Reversion is that it may point us towards a higher probability outcome, but it does not help us with the timing of such outcomes. U.S. Stocks surpassed Great Depression valuations in late 1996, but...
by Solo Prosperity
Tue Dec 12, 2017 1:50 pm
Forum: Investing - Theory, News & General
Topic: Small cap value vs. total market?
Replies: 105
Views: 14783

Re: Small cap value vs. total market?

SCV (Any any other factor/strategy) will give you the "opportunity" to out-perform the market, nothing else. Value, and other factors, have, can, and will, go very long periods of under-performance compared to the market, sometimes as long as multiple decades. You need to believe in the factor for t...
by Solo Prosperity
Mon Dec 11, 2017 4:51 pm
Forum: Investing - Theory, News & General
Topic: What mix of intermediate and short term bonds?
Replies: 45
Views: 4497

Re: What mix of intermediate and short term bonds?

Blue Ears, If you are in the spending phase you should be more concerned with inflation and maintaining purchasing power as opposed to total nominal returns with your bonds. Clearly there is a link between the two, but they are not the same. I would try to start thinking about your portfolio as some...
by Solo Prosperity
Sat Dec 09, 2017 12:50 pm
Forum: Investing - Theory, News & General
Topic: 2000-09 worst decade for large cap stocks in 109 years
Replies: 45
Views: 4025

Re: 2000-09 worst decade for large cap stocks in 109 years

I agree Nisi. My guess is 29-38 is the worst "decade". Also, if this was done on a real basis, my guess is that the 70-79 period wins. Can check this in DFA matrix book https://www.ifa.com/pdf/matrix%20book%202017.pdf Worst 10-year period for US large cap stocks of any 10-year period from 1926 to 2...
by Solo Prosperity
Sat Dec 09, 2017 10:36 am
Forum: Investing - Theory, News & General
Topic: 2000-09 worst decade for large cap stocks in 109 years
Replies: 45
Views: 4025

Re: 2000-09 worst decade for large cap stocks in 109 years

I agree Nisi. My guess is 29-38 is the worst "decade". Also, if this was done on a real basis, my guess is that the 70-79 period wins.

Anyways, the point remains. Diversify and stay the course. Whether that's geographically, by factors, etc. Find the mix that works for you, save, and go live.
by Solo Prosperity
Fri Dec 08, 2017 1:14 am
Forum: Investing - Theory, News & General
Topic: Call the top! - Bitcoin
Replies: 182
Views: 19652

Re: Call the top! - Bitcoin

$37,053 followed by an 85% crash :beer
by Solo Prosperity
Tue Dec 05, 2017 9:27 pm
Forum: Investing - Theory, News & General
Topic: Fama - Embrace passive management already
Replies: 16
Views: 2765

Re: Fama - Embrace passive management already

None of us hold the global market portfolio and never re-balance. Some of us are trying to get close to that goal by owning Vanguard Total World (net assets $9.8B) and/or ACWI (net assets $8.2B) as our equity holding. It's the ultimate Boglehead equity holding. There's always some of us oddballs ou...
by Solo Prosperity
Tue Dec 05, 2017 6:53 pm
Forum: Investing - Theory, News & General
Topic: Fama - Embrace passive management already
Replies: 16
Views: 2765

Re: Fama - Embrace passive management already

Have investors with significant tilts toward small company stocks-- using widely available small cap funds from Vanguard, Schwab, Fidelity et al- -beaten funds holding the capital-weighted total market indexes? Over the last ~25 years the Vanguard Small-Cap Index fund has beaten the Vanguard Total ...
by Solo Prosperity
Fri Dec 01, 2017 12:41 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Finding The Source Of Value
Replies: 19
Views: 2512

Re: Larry Swedroe: Finding The Source Of Value

Nisiprius, you know better then to draw conclusions over a single 13-year period. For example, if we look at 2001-2013, we would conclude that value is far superior to the market and not investing in it is just flat out dumb: Source http://i64.tinypic.com/44a6p.jpg Most people get caught up in this ...
by Solo Prosperity
Thu Nov 16, 2017 11:50 am
Forum: Investing - Theory, News & General
Topic: My Favorite Alternative Funds
Replies: 198
Views: 29615

Re: My Favorite Alternative Funds

How does this compare to AQR Long Short fund QLEIX? Are these two tracking mutually exclusive segments of Value/Momentum? The funds are somewhat similar but VMOT has a larger range of potential market (beta) exposures. Even though VMOT does not explicity state that they use "Quality" in addition to...
by Solo Prosperity
Sun Oct 29, 2017 4:12 pm
Forum: Investing - Theory, News & General
Topic: Bernstein's bond choice for cowards and ST IG
Replies: 28
Views: 4135

Re: Bernstein's bond choice for cowards and ST IG

I find myself with the good doctor on this topic. You can fairly easily replicate Corporate Bond exposure with a stock/treasury bond mix (Term + Credit). If you want a 10% Corporate Bond allocation, you can just split that into roughly 5% stocks and 5% treasuries and find a very similar outcome. Add...
by Solo Prosperity
Fri Sep 29, 2017 6:35 pm
Forum: Personal Finance (Not Investing)
Topic: I am in the investment advice industry and I'm not sure if I provide any value
Replies: 67
Views: 7795

Re: I am in the investment advice industry and I'm not sure if I provide any value

That's another false dichotomy: either you have to know it all or you must have your money managed by someone, otherwise you will just trade wildly. How about "I don't know much about it but I know how to follow instructions"? Like seeing a dentist, they will have return visits. The dentist will te...
by Solo Prosperity
Fri Sep 29, 2017 1:48 pm
Forum: Personal Finance (Not Investing)
Topic: I am in the investment advice industry and I'm not sure if I provide any value
Replies: 67
Views: 7795

Re: I am in the investment advice industry and I'm not sure if I provide any value

You need to find advisors who don't manage money at all. So there won't be any pushing. As much as I agree with your first comment above. I think this is flat-wrong. I think the investment plan should be married with the financial plan. An advisor can manage money on a discretionary basis under a f...
by Solo Prosperity
Fri Sep 29, 2017 11:19 am
Forum: Personal Finance (Not Investing)
Topic: I am in the investment advice industry and I'm not sure if I provide any value
Replies: 67
Views: 7795

Re: I am in the investment advice industry and I'm not sure if I provide any value

This is simply faulty logic permeated by the advice industry, a false dichotomy. It's like a restaurant saying if you don't eat here you will starve to death. Whether 1% is much better than most would do on their own is moot when the customers can just go somewhere else for much less. I have in the...
by Solo Prosperity
Fri Sep 29, 2017 12:44 am
Forum: Personal Finance (Not Investing)
Topic: I am in the investment advice industry and I'm not sure if I provide any value
Replies: 67
Views: 7795

Re: I am in the investment advice industry and I'm not sure if I provide any value

I work in the financial services industry as well and have had similar thoughts about the standard 1% model over the years, especially when I first started. I used to get more upset about it, but since helping out advisors and some clients over the past 4 years (I am more on the planning/service sid...
by Solo Prosperity
Tue Sep 26, 2017 2:36 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: A 5 Factor Evaluation
Replies: 15
Views: 2528

Re: Larry Swedroe: A 5 Factor Evaluation

Taylor's 3-fund portfolio is a Bayesian guess with unknown probabilities. You make a subjective decision on how to allocate among the three portfolios. And you don't update your Bayesian probabilities because the market fluctuations do not provide you with any hard evidence. I agree, but that's my ...
by Solo Prosperity
Mon Sep 25, 2017 2:41 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: A 5 Factor Evaluation
Replies: 15
Views: 2528

Re: Larry Swedroe: A 5 Factor Evaluation

And the past is not a good predictor of the future. And yet, this is how we all invest. Why do you, or anyone for that matter, invest in stocks? Most people, whether they want to admit it or not, invest in stocks because of their past performance. Its important to realize that either: 1. This is al...
by Solo Prosperity
Fri Sep 22, 2017 2:37 pm
Forum: Investing - Theory, News & General
Topic: Any "average Joe" here actually make out well with individual stocks?
Replies: 108
Views: 14552

Re: Any "average Joe" here actually make out well with individual stocks?

I run three different strategies alongside our more common low-cost globally diversified portfolio that tilts toward momentum and value. Of those three strategies, one is an US-based individual stock strategy. I started it in 2015 and using VTI as a benchmark, it has a slight out-performance since t...
by Solo Prosperity
Thu Aug 31, 2017 11:44 am
Forum: Investing - Theory, News & General
Topic: Why go with an 80% stock / 20% bond portfolio?
Replies: 360
Views: 41893

Re: Why go with an 80% stock / 20% bond portfolio?

Its actually really simple. There is no pure 100% scientific reason for any portfolio mix. You can choose 100% stocks, I can choose 80%, Bogle chooses 50%. We all ultimately decide on a number that makes us feel good. Factors such as Age, Spending Needs based on Expected Life-Span, Knowledge about M...
by Solo Prosperity
Thu Aug 31, 2017 11:23 am
Forum: Investing - Theory, News & General
Topic: AAPL is midcap growth?
Replies: 5
Views: 1238

Re: AAPL is midcap growth?

Career risk :D
by Solo Prosperity
Thu Aug 31, 2017 11:23 am
Forum: Investing - Theory, News & General
Topic: Perhaps you shouldn't rebalance your SCV "tilt"
Replies: 9
Views: 1471

Re: Perhaps you shouldn't rebalance your SCV "tilt"

No surprise in the results. With almost any portfolio, you SHOULD achieve a high CAGR over long periods when you do not re-balance. By not re-balancing, you allow the higher risk, and hopefully higher return (In your case, SCV), assets to compound at higher rates at a larger weight. Re-balancing was...
by Solo Prosperity
Tue Aug 01, 2017 2:16 pm
Forum: Investing - Theory, News & General
Topic: SNAP News - S&P 500 Index vs Total Stock Market Index
Replies: 10
Views: 1317

Re: SNAP News - S&P 500 Index vs Total Stock Market Index

From May 1992 through July 2017, the CAGR difference between the S&P 500 Index Fund (VFINX) and the U.S. Total Stock Market Fund (VTSMX) was 0.11% (9.40% v. 9.51%)...Hardly anything to concern yourself over. The companies in the S&P 500 make up just around 80% of the TSM Fund. I would file this one ...
by Solo Prosperity
Fri Jul 21, 2017 4:52 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: REITs Aren't Special
Replies: 106
Views: 10708

Re: Larry Swedroe: REITs Aren't Special

It is true that REITs provide exposure to the Size, Value, Term, and Credit factors and can be historically (mostly) replicated via a combination of small/mid-cap value + Corporate Bonds: See Here It is also true, that even when replicated via factor exposure, REITs still have some level of a correl...
by Solo Prosperity
Mon Jul 17, 2017 2:00 pm
Forum: Investing - Theory, News & General
Topic: My Favorite Alternative Funds
Replies: 198
Views: 29615

Re: My Favorite Alternative Funds

It seems virtually every financial author has changed their recommendations at some point in their career. This is everything and applies to us as investors too. I firmly believe that anyone that can hold onto a reasonable strategy (Market-Cap, Value, Momentum, Trend, Multi-Factor, etc.) will be mo...
by Solo Prosperity
Thu Jul 13, 2017 2:01 pm
Forum: Investing - Theory, News & General
Topic: % bogleheads of overall population
Replies: 82
Views: 12447

Re: % bogleheads of overall population

As asif pointed out, the math shows just how small of a population bogleheads are. Obviously there are more frugal, low-cost, financial savvy people out there that are NOT on the bogleheads forum, but in general, those types of people seem to be the minority of the population. I would venture to gue...
by Solo Prosperity
Thu Jul 13, 2017 12:29 pm
Forum: Investing - Theory, News & General
Topic: Why Simple beats complex
Replies: 71
Views: 8068

Re: Why Simple beats complex

Like everything in life, simplicity is a bit subjective to all of us and definitely exhibits marginal utility properties. For the majority of our investments, we tilt towards momentum+value within global equities (5 Funds) with an economic trend overlay on the portfolios (I have a small allocation t...
by Solo Prosperity
Wed Jul 05, 2017 12:16 am
Forum: Investing - Theory, News & General
Topic: Simplest "Nobody Knows Nothing" Don't Peek Portfolio?
Replies: 20
Views: 3753

Re: Simplest "Nobody Knows Nothing" Don't Peek Portfolio?

pascalwager wrote:His rebalancing is only a quarterly adjustment back to market weighting.
If Sharpe holds the "market" portfolio he should never need to re-balance back to market weightings.