Search found 469 matches

by Ari
Tue May 08, 2018 5:02 am
Forum: Investing - Theory, News & General
Topic: How does stock buyback benefit investors?
Replies: 78
Views: 5964

Re: How does stock buyback benefit investors?

If the company can continue to produce the same amount of earnings, there are fewer owners to share those earnings. If I had been content to pay $20 for every $1 of earnings (forward p/e of 20), then presumably I’d pay more for the share since the same earnings are spread over fewer shares. I think...
by Ari
Thu May 03, 2018 1:26 am
Forum: Investing - Theory, News & General
Topic: Everything You Need to Know on an Index Card
Replies: 33
Views: 3993

Re: Everything You Need to Know on an Index Card

An index card has two sides, right? Outer game (what to do): Earn as much as you can Spend as little as you can Invest the difference in a low-cost, global stock index fund Don't sell unless you need the money urgently Once you have 25x yearly expenses, you are (barely) FI. In FI, you can spend 4% o...
by Ari
Tue Apr 24, 2018 11:57 am
Forum: Investing - Theory, News & General
Topic: Fun Money
Replies: 45
Views: 2946

Re: Fun Money

This has continually bugged me. How can someone preach that a 0.5-1% extra ER will crush your portfolio while putting a small chunk of your portfolio entirely at risk in other assets. If you only put 5% of your portfolio in nonindexed assets that tracks at 80% of market returns, you’d have essentia...
by Ari
Thu Apr 12, 2018 12:21 am
Forum: Investing - Theory, News & General
Topic: Emerging markets tilt
Replies: 37
Views: 3228

Re: Emerging markets tilt

20% EM
Rationale: They are riskier and I expect to be rewarded for that in the long term.
Prognosis: I don't do prognosis.
by Ari
Fri Apr 06, 2018 11:38 am
Forum: Investing - Theory, News & General
Topic: Bogle on stock turbulence: ‘never seen a market this volatile to this extent in my career’
Replies: 88
Views: 12667

Re: Bogle on stock turbulence: ‘never seen a market this volatile to this extent in my career’

I honestly hadn't noticed. A good global spread of my investments and not reading the news means that the only way I find out about volatile markets is reading about them on Bogleheads.
by Ari
Wed Mar 28, 2018 3:57 am
Forum: Investing - Theory, News & General
Topic: Is technical analysis all smoke and mirrors?
Replies: 62
Views: 4981

Re: Is technical analysis all smoke and mirrors?

but Larry Swedroe has come full circle on the topic and now is in favor of it. This is an honest question: then why does he bother writing and advising others instead of trading constantly and becoming fabulously wealthy? Where does this idea come from that anyone who can make money investing in an...
by Ari
Sat Mar 17, 2018 4:20 am
Forum: Investing - Theory, News & General
Topic: No risk retirement withdraw strategy - WARM
Replies: 35
Views: 4189

Re: No risk retirement withdraw strategy - WARM

That's a good point. I thought about that as well, but if we manage to escape aging, then I would assume we would be relatively healthy to go back to work to make up for the lost money. But with the rise of AI and robotics, the "work" will have totally different meaning by then. Escaping aging migh...
by Ari
Fri Mar 16, 2018 2:23 pm
Forum: Investing - Theory, News & General
Topic: No risk retirement withdraw strategy - WARM
Replies: 35
Views: 4189

Re: No risk retirement withdraw strategy - WARM

In this article, a couple in their 50’s have a 2 million dollars nest egg from which they’re withdrawing $40k a year. So they should be good for 50 years. Simple. No advisors. No stock market risk. It puts you in the control, instead of external factors like the market or the economy. The article g...
by Ari
Mon Mar 12, 2018 8:50 am
Forum: Investing - Theory, News & General
Topic: Why International again?
Replies: 224
Views: 19877

Re: Why International again?

I'm currently holding my nose while my strategy forces me to have exposure as high as 18% to US equities... I know what you mean. :) I'm 20% US and staying the course is not easy, but I'm not going to try to time this. Just happy that my allocation keeps me with plenty of other exposures to diversi...
by Ari
Mon Mar 12, 2018 4:58 am
Forum: Investing - Theory, News & General
Topic: Why International again?
Replies: 224
Views: 19877

Re: Why International again?

"Past results are no guarantee for future returns" It depends. Sometimes our investment decisions are based on the past. The number one reason given for using "passive" instead of "active" is that only a few [actively managed funds] have managed to beat their index counterpart. So, based on past pe...
by Ari
Sat Mar 10, 2018 12:16 pm
Forum: Investing - Theory, News & General
Topic: Give me the long-term predictability of shares, at any age
Replies: 14
Views: 1731

Re: Give me the long-term predictability of shares, at any age

It might seem strange, at first sight, but most people with a $1 million portfolio wouldn't project ahead assuming they only possess a $500 thousands portfolio. So, if a crisis happens and the portfolio drops to $500 thousands, they'll feel that they've sustained a significant loss, probably equati...
by Ari
Sat Mar 10, 2018 12:07 pm
Forum: Investing - Theory, News & General
Topic: Why International again?
Replies: 224
Views: 19877

Re: Why International again?

In portfoliovisualizer.com backtest portfolio asset class allocation, I enter 10,000 set to maximum date range, defaults to 1986. Portfolio 1: 100% US Stock Market. Final balance: 250,840. CAGR 10.56. Stdev 15.01. Portfolio 2: 100% ex-US Stock Market. Final balance: 102,288. CAGR 7.52. Stdev 17.88....
by Ari
Fri Mar 09, 2018 5:03 am
Forum: Investing - Theory, News & General
Topic: Why International again?
Replies: 224
Views: 19877

Re: Why International again?

The world market portfolio has historically outperformed the vast majority of single country markets. A better way to put it: The CAGR (compounded annual growth rate) of the world market portfolio is significantly higher than the CAGR for the average single-country market portfolio. And more import...
by Ari
Fri Mar 09, 2018 5:00 am
Forum: Investing - Theory, News & General
Topic: Why International again?
Replies: 224
Views: 19877

Re: Why International again?

The world market portfolio has historically outperformed the vast majority of single country markets. A few countries have managed to outperform it historically (among them my home country of Sweden). If you are a skilled country-picker, it seems reasonable to choose to invest in the country or coun...
by Ari
Fri Mar 09, 2018 2:09 am
Forum: Investing - Theory, News & General
Topic: Give me the long-term predictability of shares, at any age
Replies: 14
Views: 1731

Re: Give me the long-term predictability of shares, at any age

Yeah, it seems strange to me to say that the problem is that suddenly you have a lot of money that you risk losing. It seems like a nice problem to have.
by Ari
Fri Dec 22, 2017 3:18 am
Forum: Investing - Theory, News & General
Topic: What is or was your target multiplier (_ x annual expenses) for retirement?
Replies: 41
Views: 5495

Re: What is or was your target multiplier (_ x annual expenses) for retirement?

#1: What is (or was for those already retired) your expected multiplier, in regards to annual expenses, for retirement? (assume no pension) Basic goal post is 25x, though I might increase that a bit as I draw closer to retirement. I don't have a set date for my retirement, but when I reach 25x, I'l...
by Ari
Fri Dec 22, 2017 3:06 am
Forum: Investing - Theory, News & General
Topic: Saving for the crash
Replies: 58
Views: 7886

Re: Saving for the crash

Yup. Time in the market, not timing the market. Dry powder loses more money by not being in the market than it gains by buying low.
by Ari
Mon Dec 18, 2017 5:45 am
Forum: Investing - Theory, News & General
Topic: Investing in "Frontier" Markets
Replies: 22
Views: 1869

Re: Investing in "Frontier" Markets

A lot of these countries seem pretty ok to me. Some of them are EU countries! It's not sudanese warlords or afghani bonds. Sure, they've generally lower investor protections and higher corruption than developed countries, but countries like Malta and Estonia seem very safe to me. Combine it with div...
by Ari
Wed Dec 13, 2017 1:11 pm
Forum: Investing - Theory, News & General
Topic: What are your thoughts on the "Golden Butterfly" portfolio?
Replies: 115
Views: 21123

Re: What are your thoughts on the "Golden Butterfly" portfolio?

Two things I often see on BH: * Bonds are not for return. They are there to dampen the volatility of stocks. Even if they return close to zero, you should still own them. * Gold is not an investment because it doesn't produce returns. It has no place in a buy-and-hold portfolio. I'm assuming these t...
by Ari
Tue Dec 12, 2017 3:46 am
Forum: Investing - Theory, News & General
Topic: Concerns about investing abroad
Replies: 27
Views: 2561

Re: Concerns about investing abroad

I am not sure what the point of your second point is (so to speak). Of course currency risk occurs if the currency of the underlying asset is different from one's own currency. The accounting currency of the fund is irrelevant. My point was that a eurozone investor, if they want to avoid currency r...
by Ari
Sat Dec 09, 2017 6:35 am
Forum: Investing - Theory, News & General
Topic: "Think you can time the stock market? Look at this chart first"
Replies: 42
Views: 4612

Re: "Think you can time the stock market? Look at this chart first"

This article does nothing to dissuade market timing. You're as likely to miss the best days as the worst.
by Ari
Fri Dec 08, 2017 4:18 am
Forum: Investing - Theory, News & General
Topic: "Financial Shock" wealth
Replies: 33
Views: 6530

Re: "Financial Shock" wealth

Another way to handle this is to avoid the risk of financial shocks. I don't have an emergency fund, but I also don't have a car (no sudden repairs), I don't own my home (ditto), I live in a country with tax-paid healthcare (no healthcare costs) and high unemployment benefits (income would not sink ...
by Ari
Mon Dec 04, 2017 4:37 am
Forum: Investing - Theory, News & General
Topic: Any thoughts on The Aurora Report? [Arora Report]
Replies: 51
Views: 11124

Re: Any thoughts on The Aurora Report? [Arora Report]

In many respects, that perspective negates the entire idea of Capitalism. But clearly, some companies are better than others. Some succeed and some fail. Some produce vast wealth and others go bankrupt. So I truly don't understand the mantra on this site that it is pointless to pick individual stoc...
by Ari
Sat Nov 25, 2017 2:22 pm
Forum: Investing - Theory, News & General
Topic: The ‘Vanguard effect’ means your investments could soon cost nothing
Replies: 4
Views: 1636

Re: The ‘Vanguard effect’ means your investments could soon cost nothing

40% of my portfolio is invested in a fund with 0% ER. I know of at least two others. They are used by brokers to entice investors to come to their platforms, where you will hopefully make other trades as well.
by Ari
Thu Nov 16, 2017 4:04 am
Forum: Investing - Theory, News & General
Topic: Fixed percentage withdrawal of maximum portfolio value?
Replies: 14
Views: 1441

Fixed percentage withdrawal of maximum portfolio value?

I enjoy thinking about withdrawal methods. It's fun. I'm some way away from starting to withdraw, but when I do, I'm hoping I'll find a method that will allow my portfolio to grow over time even as I withdraw. I will probably have a long retirement and want my withdrawals to increase over time, maki...
by Ari
Tue Nov 14, 2017 2:07 am
Forum: Investing - Theory, News & General
Topic: "A Case Against Over Weighting International Equity"
Replies: 11
Views: 1629

Re: "A Case Against Over Weighting International Equity"

When valuations are discussed, it seems people are always talking about them returning or not returning to the mean/historical average. This might be relevant if you're talking about a single market over time, but I find it less important when comparing different markets. All else being equal, a mar...
by Ari
Tue Nov 14, 2017 1:31 am
Forum: Investing - Theory, News & General
Topic: Buffett 90/10 Portfolio vs Target Retirement
Replies: 33
Views: 6190

Re: Buffett 90/10 Portfolio vs Target Retirement

Total World seems like a good fund to hold for the OP. It adheres to Boglehead principles better than Bogle and Buffet do, and it's still massively overweighted in the US (USA is less than a quarter of the world economy, but is 50% of publicly traded companies). US-only funds and non-US funds diverg...
by Ari
Thu Nov 09, 2017 7:20 am
Forum: Investing - Theory, News & General
Topic: "The small-cap effect really has failed to materialize"
Replies: 37
Views: 6094

Re: "The small-cap effect really has failed to materialize"

In the case of small-caps, a big problem is that basically any time period that includes 1975-1983 supports the effect... and any time period that omits it, doesn't. I learned that from Siegel's "Stocks for the Long Run," which has an interesting chart: http://i62.tinypic.com/bhj14n.png Eyeballing ...
by Ari
Wed Oct 25, 2017 2:30 am
Forum: Investing - Theory, News & General
Topic: Theoretical — Lump Sum Investing Your Lifetime Earnings
Replies: 11
Views: 1585

Re: Theoretical — Lump Sum Investing Your Lifetime Earnings

Of course! Giving them a lot more time to compound should mean I get a lot more money in the end. I'd also have a lot more security, seeing as I'd probably be more or less financially independent.
by Ari
Fri Oct 20, 2017 5:25 am
Forum: Investing - Theory, News & General
Topic: "Investment Lessons From The 21st Century"
Replies: 16
Views: 2359

Re: "Investing: What We've Learned This Century"

An arguable point. Perhaps it would be more useful; but if not lump sum, what algorithm would you use to increase utility for the “average investor” while making comparisons possible? One dollar (or a hundred euros, or whatever) invested at the end of each month during the period examined, for exam...
by Ari
Fri Oct 20, 2017 2:48 am
Forum: Investing - Theory, News & General
Topic: "Investment Lessons From The 21st Century"
Replies: 16
Views: 2359

Re: "Investing: What We've Learned This Century"

However, that’s not what the author has concluded (see below). I suggest a re-read. Conclusions from Allan Roth • Understand that stocks are risky and invest accordingly. • Understand how long your long run is. • Don't invest based on the recent past. • High-quality bonds act as a shock absorber an...
by Ari
Thu Oct 19, 2017 3:26 am
Forum: Investing - Theory, News & General
Topic: "Investment Lessons From The 21st Century"
Replies: 16
Views: 2359

Re: "Investing: What We've Learned This Century"

Start measuring from the peak of one of the biggest runups of the last 100 years and just before the crash. Not very suprising that stocks don't do well. Fortunately, most investors will not suddenly invest all of their savings in a lump sum at one specific point (and even if they do, chances are sl...
by Ari
Wed Oct 18, 2017 7:43 am
Forum: Investing - Theory, News & General
Topic: The overselling of international diversification
Replies: 56
Views: 5923

Re: The overselling of international diversification

I imagine the "efficient market theory" that BH depends on doesn't apply internationally, especially to developing countries where transparency, rule of law, and minimal corruption is an issue. Why is that? Do other investors not know about these issues, or do they systematically misprice them in a...
by Ari
Mon Oct 09, 2017 6:11 am
Forum: Investing - Theory, News & General
Topic: Has your "risk tolerance" been tested?
Replies: 105
Views: 7910

Re: Has your "risk tolerance" been tested?

I am at 100% stocks and I have not been tested. There are a few reasons why I am still comfortable with this: 1: I know myself. This is of course hardly bulletproof. Lots of people are surprised at their own reactions in situations they have not been in before, so it's possible I would panic sell. B...
by Ari
Fri Sep 29, 2017 6:52 am
Forum: Investing - Theory, News & General
Topic: Why do you LBYM? Why do you save and invest?
Replies: 204
Views: 17302

Re: Why do you LBYM? Why do you save and invest?

I'm still a bit angry that nobody told me that it's possible to retire early until I was almost 30. It's not something I'd heard about, and I didn't know you could get continuous income from stocks. I remember thinking about it when I was younger, but I assumed I'd have to be able to live on the int...
by Ari
Mon Sep 25, 2017 5:49 am
Forum: Investing - Theory, News & General
Topic: How an asset with a NEGATIVE return can INCREASE your portfolio's return
Replies: 31
Views: 3558

Re: How an asset with a NEGATIVE return can INCREASE your portfolio's return

Thanks to Nisiprius' graphs, it seems clear what's going on: Bitcoin has a large dip followed by a large recovery. Continuously rebalancing during this time amounts to dollar-cost averaging in a recession. You get to buy more and more as the market is tanking, then get an extra boost as the market r...
by Ari
Fri Sep 22, 2017 8:25 am
Forum: Investing - Theory, News & General
Topic: Which is better a Cryptocurrency or Gold?
Replies: 99
Views: 7699

Re: Which is better a Cryptocurrency or Gold?

Interesting question. I own neither, but for the purposes you mention (and assuming I can't do some of both), I think I'd still choose gold, perhaps stored in a country like New Zealand. Cryptocurrencies could conceivably fill this role in the future, but at the moment it's a bit too unsure as to ho...
by Ari
Fri Sep 22, 2017 1:00 am
Forum: Investing - Theory, News & General
Topic: No More Saving???
Replies: 114
Views: 11855

Re: No More Saving???

I could stop saving now and likely have more than enough to retire at 65, and I'd probably have the same income in retirement as in employment. But since I plan to retire well before that time, I keep saving.
by Ari
Thu Sep 21, 2017 8:23 am
Forum: Investing - Theory, News & General
Topic: AA if you were just starting out again
Replies: 49
Views: 4234

Re: AA if you were just starting out again

climber2020 wrote:
Thu Sep 21, 2017 5:54 am
What are local funds? I haven't heard about that before.
Swedish funds. I live in Sweden. Fewer tax complications, fewer currency exchange fees, less hassle than American funds.
by Ari
Thu Sep 21, 2017 3:28 am
Forum: Investing - Theory, News & General
Topic: AA if you were just starting out again
Replies: 49
Views: 4234

Re: AA if you were just starting out again

In the very beginning, I just had an account with some randomly chosen funds with fancy names that I knew nothing about. Pretty much no money there, and "saving for retirent" wasn't a thing people did that I heard about. I didn't really know you could get a steady income from investments. I didn't c...
by Ari
Fri Sep 15, 2017 12:48 am
Forum: Investing - Theory, News & General
Topic: Hedge Your Currency Risk When Investing Abroad ?
Replies: 17
Views: 1342

Re: Hedge Your Currency Risk When Investing Abroad ?

Putting all of your assets in a single currency seems to me to be the opposite of diversification. I do not hedge my foreign holdings (I'm not an American, though).
by Ari
Thu Sep 14, 2017 12:24 am
Forum: Investing - Theory, News & General
Topic: What If U.S. Stocks Stay Expensive For Years?
Replies: 50
Views: 8374

Re: What If U.S. Stocks Stay Expensive For Years?

Seems pretty straight-forward to me, really. Higher P/E means lower earnings per invested dollar. Of course returns are going to be low. I don't think the predictive power of CAPE when it comes to future earnings has much if anything to do with mean reversion. You simply have to pay more for the sam...
by Ari
Tue Sep 12, 2017 1:35 am
Forum: Investing - Theory, News & General
Topic: Safe Withdrawal Rate -> 2% or lower
Replies: 72
Views: 9653

Re: Safe Withdrawal Rate -> 2% or lower

Which means you may end up with a 20 year retirement because you worked 10 years longer to fund the 50+ years that there is no real actuarial basis for expecting that you will live for. That's a decision you are free to make, of course. But it would seem like a horrible shame to have worked an extr...
by Ari
Wed Sep 06, 2017 12:22 am
Forum: Investing - Theory, News & General
Topic: Safe Withdrawal Rate -> 2% or lower
Replies: 72
Views: 9653

Re: Safe Withdrawal Rate -> 2% or lower

Another big variable is of course life expectancy. Only recently has serious study begun on life extension, and scientific breakthroughs are unpredictable. Aubrey De Grey has claimed that the first person to live to 1,000 has already been born. Of course, if we live that long, the economy will likel...
by Ari
Wed Aug 16, 2017 12:46 am
Forum: Investing - Theory, News & General
Topic: Two nice charts on default and duration risk
Replies: 11
Views: 1397

Re: Two nice charts on default and duration risk

Am I wrong if I interpret these charts as "credit risk gives more return for the same amount of risk than does term risk"? Or even "corporate bonds give more return for the same amount of risk than does government bonds"? Point 1 on the second graph seems clearly superior to point 3 on the first. Bu...
by Ari
Wed Aug 09, 2017 12:06 am
Forum: Investing - Theory, News & General
Topic: Still Buying As planned Regardless Of The World Situation
Replies: 72
Views: 9402

Re: Still Buying As planned Regardless Of The World Situation

Whenever the market is high, people tell you "You can't buy now; it's overvalued and about to crash!". Whenever the market is low, people tell you "You can't buy now; we're in a bear market and tanking!". If you listened to what people are saying, you'd stay out of investing altogether.
by Ari
Sun Jul 16, 2017 6:05 am
Forum: Investing - Theory, News & General
Topic: 90:10 AA - what don't you believe about it?
Replies: 101
Views: 8865

Re: 90:10 AA - what don't you believe about it?

I'm pretty sure Bogle is wealthy, too. Better ignore his advice as well. Poor people know more about managing money than the wealthy? :shock: That seems to be the consensus, no? I see a lot of people in this thread saying "Buffet's wife can stand to lose her 90% in stocks. If you can't, don't follo...
by Ari
Sat Jul 15, 2017 2:20 pm
Forum: Investing - Theory, News & General
Topic: 90:10 AA - what don't you believe about it?
Replies: 101
Views: 8865

Re: 90:10 AA - what don't you believe about it?

I'm pretty sure Bogle is wealthy, too. Better ignore his advice as well.
by Ari
Fri Jul 14, 2017 1:27 am
Forum: Investing - Theory, News & General
Topic: 90:10 AA - what don't you believe about it?
Replies: 101
Views: 8865

Re: 90:10 AA - what don't you believe about it?

Some of the 90/10 people will sell out during a downturn and be in cash for a long time. Anyone know of any studies on this? It's often touted around as an established fact on these forums, but have anyone seen numbers on how many people sell off during downturns, preferrably with data for differen...
by Ari
Sun Jun 25, 2017 1:22 am
Forum: Investing - Theory, News & General
Topic: Good Article on Bubbles and Staying the Course
Replies: 27
Views: 4040

Re: Good Article on Bubbles and Staying the Course

If, as the article suggests, there is no "one true price", because investors of different time horizons have different price preferences, doesn't this imply that it should be possible to beat the market? If a stock is bid up high by short term investors, it should be avoided by long-term investors, ...