Search found 1397 matches

by garlandwhizzer
Wed Nov 23, 2016 3:31 pm
Forum: Investing - Theory, News & General
Topic: Renaissance Technologies - Inside a Moneymaking Machine Like No Other
Replies: 54
Views: 5657

Re: Renaissance Technologies - Inside a Moneymaking Machine Like No Other

matjen wrote: Inside a Moneymaking Machine Like No Other The Medallion Fund, an employees-only offering for the quants at Renaissance Technologies, is the blackest box in all of finance. I believe that a smallish group of very sophisticated investors can substantially outperform the market as long ...
by garlandwhizzer
Tue Nov 22, 2016 12:07 pm
Forum: Investing - Theory, News & General
Topic: What does a bond bear market look like?
Replies: 91
Views: 9081

Re: What does a bond bear market look like?

The chart in longinvest's post shows real inflation adjusted returns on a 5 year duration bond portfolio and stock portfolio over the 16 years from 1966 - 1981. Both were negative in real returns over the 16 year time span. Frankly I don't find it very reassuring that in a moderate/severe inflationa...
by garlandwhizzer
Mon Nov 21, 2016 9:52 pm
Forum: Investing - Theory, News & General
Topic: What does a bond bear market look like?
Replies: 91
Views: 9081

Re: What does a bond bear market look like?

Wade Pfau's table of the worst bond markets gives us caution. It is important to remember that the results are listed in the kind of dollars that count, real inflation adjusted returns. When you go into a period of ever increasing inflation over multiple decades, bond yields tend to lag increases in...
by garlandwhizzer
Mon Nov 21, 2016 12:50 pm
Forum: Investing - Theory, News & General
Topic: November Returns: TIPs, Small Value, High Yield Rules!
Replies: 16
Views: 2206

Re: November Returns: TIPs, Small Value, High Yield Rules!

columbia wrote: Do the higher yield bonds and (large cap) value aspects explain some of the success of the Wellesley Income fund in the past? Over the last 9 years of ever lower yielding bonds that produced all time record lows in yields, many income starved investors and funds increased bond risk ...
by garlandwhizzer
Sun Nov 20, 2016 1:49 pm
Forum: Investing - Theory, News & General
Topic: November Returns: TIPs, Small Value, High Yield Rules!
Replies: 16
Views: 2206

Re: November Returns: TIPs, Small Value, High Yield Rules!

Grok87 makes a good point. During inflationary environments TIPS and high yield are expected to outperform other bond categories while SCV is expected to outperform in the equity space. Commodities also may benefit relative to other equity assets in an inflationary environment. Before we go running ...
by garlandwhizzer
Thu Nov 17, 2016 2:10 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Investor Questionnaire recommends 100% stocks!
Replies: 56
Views: 5221

Re: Vanguard Investor Questionnaire recommends 100% stocks!

I am not surprised by Vanguard's recommendation and, if you answered the questions honestly, I agree with a 100% stock allocation. There are individuals who can tolerate market volatility and who do not need to sell investment assets for a multiple decades, and for those few 100% stock allocations s...
by garlandwhizzer
Mon Nov 14, 2016 2:31 pm
Forum: Personal Finance (Not Investing)
Topic: AARP annuity; is it a scam?
Replies: 48
Views: 13747

Re: AARP annuity; is it a scam?

ObliviousInvestor wrote: It's somewhat more complicated than that. A portion of each annuity payment is considered to be return of principal and is therefore not taxable. IRS Publication 939 has more info: http://www.irs.gov/publications/p939/ar02.html Certainly true. On the other hand if one inves...
by garlandwhizzer
Sun Nov 13, 2016 1:56 pm
Forum: Investing - Theory, News & General
Topic: Why patience and discipline are key to investing, it's temperament not intellect
Replies: 38
Views: 5352

Re: Why patience and discipline are key to investing, it's temperament not intellect

Larry wrote: So example might be that instead of a Vanguard TSM 60% and a Vanguard Intermediate Term Treasury fund 40%, you might be 40% DFA SV or Bridgeway SV or something similar and 60% Intermediate Treasury. The first portfolio loads on beta 0.6 (1x 60%) while the second loads about .4 (bit hig...
by garlandwhizzer
Thu Nov 10, 2016 5:42 pm
Forum: Investing - Theory, News & General
Topic: Barbell strategies?
Replies: 14
Views: 2085

Re: Barbell strategies?

The concept of combining a high percentage of the safest bonds (usually short term Treasuries) with a low/modest percentage of assets with the highest expected returns (EM, aggressive factor approaches) is exactly what the Larry portfolio does. Med Faber backtested numerous portfolio allocation styl...
by garlandwhizzer
Wed Nov 09, 2016 1:49 pm
Forum: Investing - Theory, News & General
Topic: Just don't panic
Replies: 61
Views: 9257

Re: Just don't panic

Just don't panic. I think that says it all in terms of what to do right now for those of us who take a long term investing view. The futility of changing portfolio allocations based on what one expects in the near future is demonstrated clearly by the apparent total surprise of this election in whic...
by garlandwhizzer
Thu Nov 03, 2016 1:06 pm
Forum: Investing - Theory, News & General
Topic: Low Interest Rates: Opportunities Missed?
Replies: 14
Views: 2199

Re: Low Interest Rates: Opportunities Missed?

Even at low interest rates buying stock on margin is a two edged sword: increased opportunity, increased risk. When you borrow at 2% to invest, it sounds compelling on paper, but it's important to keep in mind that the interest payments are fixed and ongoing. On the other hand the equity investment ...
by garlandwhizzer
Mon Oct 31, 2016 2:14 pm
Forum: Investing - Theory, News & General
Topic: "Jack Bogle and the Presidential Medal of Freedom"
Replies: 24
Views: 3242

Re: "Jack Bogle and the Presidential Medal of Freedom"

I just emailed the President for Jack Bogle. He richly deserves the Presidential Medal of Freedom.

Garland Whizzer
by garlandwhizzer
Fri Oct 28, 2016 4:36 pm
Forum: Investing - Theory, News & General
Topic: Bogle's Total Stock Return Chart
Replies: 23
Views: 3728

Re: Bogle's Total Stock Return Chart

kmok corrected my post: Incorrect. Dividends have no impact on current year GAAP earnings, period. Dividends does reduced retained earnings, but retained earnings is basically accumulation of historical earnings less dividends and other less common activities such as repurchase of common stock. Tha...
by garlandwhizzer
Fri Oct 28, 2016 11:35 am
Forum: Investing - Theory, News & General
Topic: Bogle's Total Stock Return Chart
Replies: 23
Views: 3728

Re: Bogle's Total Stock Return Chart

GuitarXM wrote: Isn't this double counting the dividends, because the earnings figure already includes the dividends? Dividends are subtracted from corporate income as a business cost before earnings are calculated. Therefore dividends paid out to shareholders have an accounting effect of reducing ...
by garlandwhizzer
Wed Oct 26, 2016 2:03 pm
Forum: Investing - Theory, News & General
Topic: Future technology and future inflation
Replies: 9
Views: 1103

Re: Future technology and future inflation

The problem with the ever increasing pace of technological advances is that: 1) It creates a few very high paying jobs for highly skilled workers, those with high levels of education and/or technical training who design, manufacture and market these labor saving devices. 2) It destroys many jobs for...
by garlandwhizzer
Wed Oct 26, 2016 1:18 pm
Forum: Investing - Theory, News & General
Topic: Dr. Bill Bernstein Books
Replies: 40
Views: 3893

Re: Dr. Bill Bernstein Books

Rational Expectations is a favorite of mine. Bill writes books, it seems to me, not merely to make money but to impart knowledge and wisdom about the markets that he has gleaned from a long and distinguished investing career. He presents the historical data, analyzes it, and draws logical non-emotio...
by garlandwhizzer
Mon Oct 24, 2016 11:49 am
Forum: Investing - Theory, News & General
Topic: If the interest rates rise, won't the bond prices go down?
Replies: 22
Views: 2945

Re: If the interest rates rise, won't the bond prices go down?

The biggest risk to bonds in my view is not the Fed's expected snail-like pace of minuscule (0.25%) rises in interest rates. That is a tempest in a teapot. Bonds will in time recover nicely from that. The Fed can exert some control on short term rates, but has much less control on long term rates wh...
by garlandwhizzer
Fri Oct 21, 2016 12:26 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe's latest market returns forecast
Replies: 380
Views: 31868

Re: Larry Swedroe's latest market returns forecast

Great article, Larry, thanks for posting. I completely agree that INTL diversification is likely to pay off in the future. I believe that INTL and EM in particular are very likely to outperform US including US SCV, US MOM, and US multi-factor funds in the future. Much discussion occurs in this Forum...
by garlandwhizzer
Thu Oct 20, 2016 3:11 pm
Forum: Investing - Theory, News & General
Topic: Meb Faber article links
Replies: 6
Views: 883

Re: Meb Faber article links

I clicked on Meb Faber's article and thought it was interesting and informative. Thanks for posting. Mebane Faber examines many asset allocation models (including Larry's, El Arian's, Swenson's, 60/40, SCV tilt, Buffett's 90/10, etc.,) with long term backtesting (40+ yrs.) looking at returns, volati...
by garlandwhizzer
Tue Oct 18, 2016 2:34 pm
Forum: Investing - Theory, News & General
Topic: Can gold and real estate grow in real terms in the very long run?
Replies: 32
Views: 2767

Re: Can gold and real estate grow in real terms in the very long run?

Where there are no building constraints on creation of new residential real estate, the average appreciation is expected to be, net of costs such as real estate taxes, maintenance, etc, about the inflation rate long term as long as demand doesn't decrease. If demand decreases--plants close, jobs dis...
by garlandwhizzer
Fri Oct 14, 2016 12:30 pm
Forum: Investing - Theory, News & General
Topic: Cliff Asness - Turning Over Accepted Wisdom with Turnover
Replies: 29
Views: 3016

Re: Cliff Asness - Turning Over Accepted Wisdom with Turnover

in_reality wrote: Why is someone who only holds the TSM defined as a passive investor? They have made an active choice to not hold the market. AlohaJoe replied: Because that's how Sharpe defines it in his paper? He's pretty explicit about it. in_reality replied: Yeah I know. What I don't understand...
by garlandwhizzer
Thu Oct 13, 2016 12:47 pm
Forum: Investing - Theory, News & General
Topic: Cliff Asness - Turning Over Accepted Wisdom with Turnover
Replies: 29
Views: 3016

Re: Cliff Asness - Turning Over Accepted Wisdom with Turnover

Sharpe's point is really very simple and it relates primarily to the king of indexes in my view, TSM. If the passive investor holds a market weighted TSM portfolio, all other active/factor investors combined must by definition hold in aggregate a market weighted portfolio. If you subtract a market w...
by garlandwhizzer
Wed Oct 12, 2016 9:50 pm
Forum: Investing - Theory, News & General
Topic: Cliff Asness - Turning Over Accepted Wisdom with Turnover
Replies: 29
Views: 3016

Re: Cliff Asness - Turning Over Accepted Wisdom with Turnover

How very strange that two who make their livelihood from selling non-market weighted indexes should find fault with Bill Sharpe's "The Arithmetic of Active Management." Certainly with some indexes, one can argue that turnover, being added to or subtracted from the index, may create frictio...
by garlandwhizzer
Wed Oct 05, 2016 2:03 pm
Forum: Investing - Theory, News & General
Topic: 30 yr TIPS Auction: Announced 10/13: yield 0.6%?
Replies: 66
Views: 6010

Re: 30 yr TIPS Auction: Announced 10/13: yield 0.6%?

The fact that there is so much interest aroused by a 0.6% real inflation adjusted yield over a 30 year duration says a lot about where investor sentiment lies now. We're willing to settle for a piddling long term return if inflation risk is removed from the equation and we're guaranteed to get the m...
by garlandwhizzer
Mon Oct 03, 2016 11:17 am
Forum: Investing - Theory, News & General
Topic: 30 yr TIPS Auction: Announced 10/13: yield 0.6%?
Replies: 66
Views: 6010

Re: 30 yr TIPS Auction: Announced 10/13: yield 0.6%?

30 years carries a lot of duration risk to principle for a 0.6% real return even if principle keeps up with inflation. If in ten or twenty years TIPS are yielding 2+% real (which 10 yr. TIPS did in the early 2000s), who will want to lock up long term money for 0.6% real yield? Significant decline in...
by garlandwhizzer
Fri Sep 02, 2016 10:02 pm
Forum: Investing - Theory, News & General
Topic: Asness - Indexing Is Capitalism at Its Best
Replies: 8
Views: 1688

Re: Asness - Indexing Is Capitalism at Its Best

Cliff Asness is a very knowledgeable and, I believe, well meaning guy whose comments stick very close to the truth as he sees it. It is to his credit that he lauds indexing rather than stock picking active management and makes the point that indexing, be it cap weight or fundamental, has helped the ...
by garlandwhizzer
Wed Aug 31, 2016 4:25 pm
Forum: Investing - Theory, News & General
Topic: bad economic news good for stock market?
Replies: 11
Views: 1309

Re: bad economic news good for stock market?

Andyrunner wrote: Bad news sells, good news does not, that is why you see so much more bad news. Media companies are in the business to sell ads not inform people. That is my cynical view on the media. 1+ I believe Andyrunner's view of the media is realistic and accurate. Sometimes it's appropriate...
by garlandwhizzer
Wed Aug 31, 2016 1:50 pm
Forum: Investing - Theory, News & General
Topic: bad economic news good for stock market?
Replies: 11
Views: 1309

Re: bad economic news good for stock market?

Financial firms and the financial media are obsessed with the very short term daily or even hourly market news and market variations. Why is the market going up (or down) today? What piece of news drives these short term changes? What will the FED do next? For those with a long time horizon, I think...
by garlandwhizzer
Wed Aug 31, 2016 1:30 pm
Forum: Investing - Theory, News & General
Topic: Investing early..!
Replies: 31
Views: 2191

Re: Investing early is better. Myth debunked!

The earlier you start investing, the better you long term outcome. That is not a myth. It has been a historical fact in the US if the time frame is at least several decades long. If you invest some fixed amount from your salary every month, even if it is a small amount, over a long period of several...
by garlandwhizzer
Tue Aug 30, 2016 7:23 pm
Forum: Investing - Theory, News & General
Topic: Leverage Success Stories
Replies: 52
Views: 5509

Re: Leverage Success Stories

Leverage success stories certainly exist. So do leverage failure stories. Bankruptcy court is a good place to find leverage failure stories especially with high levels of leverage. I personally know of folks who were once got rich off real estate investing but got over leveraged into bubble real est...
by garlandwhizzer
Mon Aug 29, 2016 3:29 pm
Forum: Investing - Theory, News & General
Topic: What is the dividend yield of VWRD, 2% or nearly 3%?
Replies: 5
Views: 1020

Re: What is the dividend yield of VWRD, 2% or nearly 3%?

Much of the dividend yield of VWRD is not in dollars but in foreign currencies. Therefore the problem may be with translating foreign dividends in foreign currencies into dollars which brings currency market fluctuations into the picture. Currencies go up and down relative to the dollar, sometimes q...
by garlandwhizzer
Mon Aug 29, 2016 12:37 pm
Forum: Investing - Theory, News & General
Topic: Retirees Saying No To The Market
Replies: 57
Views: 8052

Re: Retirees Saying No To The Market

Most of those at or close to retirement whom I personally know are much more heavily invested in real estate than in stocks and bonds. I believe that only a minority of potential investors have sufficient market knowledge background and, more importantly, are emotionally equipped to deal with the up...
by garlandwhizzer
Sun Aug 28, 2016 12:48 pm
Forum: Investing - Theory, News & General
Topic: Adding Inflation Protection to a Portfolio
Replies: 14
Views: 1727

Re: Adding Inflation Protection to a Portfolio

There are ways to hedge inflation risk but not insure against it. Insuring against it requires TIPS or inflation adjusted annuities but neither of them offer any significant expected positive real return going forward from here. Bernstein has made the point that international diversification and com...
by garlandwhizzer
Fri Aug 26, 2016 1:18 pm
Forum: Investing - Theory, News & General
Topic: Damodaran: CAPE is no-good horrible & a market timing spreadsheet
Replies: 25
Views: 3067

Re: Damodaran: CAPE is no-good horrible & a market timing spreadsheet

The fact that CAPE 10 looks high now suggests but does not prove that equity returns over the next decade will be lower than in the long term historical past. The fact that ratios of earnings yields between bonds or cash on the one hand and CAPE 10 on the other look normal does not imply that equiti...
by garlandwhizzer
Wed Aug 24, 2016 6:02 pm
Forum: Investing - Theory, News & General
Topic: Why Does Wealthfront Allocate So Much To Emerging Markets?
Replies: 9
Views: 1440

Re: Why Does Wealthfront Allocate So Much To Emerging Markets?

I believe that Burton Malkiel is not alone in suggesting an overweight of EM in current market conditions. Both GMO (Jeremy Grantham) and Research Affiliates (Rob Arnott) are projecting much higher returns for EM equities over the next decade than for US equities. That is why, I believe, they recomm...
by garlandwhizzer
Wed Aug 24, 2016 3:28 pm
Forum: Investing - Theory, News & General
Topic: UK TIPS track record - what can we learn?
Replies: 18
Views: 1284

Re: UK TIPS track record - what can we learn?

longinvestwrote: Just for perspective, let's compare how stocks did relative to bonds, in the high-inflation era of the 1970s. Here's both our nominal 10 to 2-year government bond fund* and the S&P 500** fighting inflation**. This time, I've selected the worst possible starting year (1973): Ima...
by garlandwhizzer
Wed Aug 24, 2016 3:17 pm
Forum: Investing - Theory, News & General
Topic: P/E Ratio Question
Replies: 22
Views: 1984

Re: P/E Ratio Question

I believe that during a severe recession it's not only corporate profits that decline dramatically. There are earnings adjustments in GAAP earnings, one time write downs due to decreased value of corporate assets, etc., that can affect both book value and GAAP earnings dramatically and thereby disto...
by garlandwhizzer
Tue Aug 23, 2016 1:19 pm
Forum: Investing - Theory, News & General
Topic: Diversification
Replies: 8
Views: 987

Diversification

Although the point is not a new one, this is an Interesting article at least to me. Comments?

http://www.schwab.com/public/schwab/nn/articles/Your-portfolio-may-be-less-diversified-than-you-think

Garland Whizzer
by garlandwhizzer
Tue Aug 23, 2016 1:08 pm
Forum: Investing - Theory, News & General
Topic: Long‑Maturity TIPS in Retirement Portfolios
Replies: 3
Views: 523

Re: Long‑Maturity TIPS in Retirement Portfolios

Long maturity TIPS do eliminate inflation risk but in a rising interest rate environment where bond yields may be increasing faster than inflation their principal value declines in proportion to their duration just like nominal bonds do. If you can live off the real yields generated by TIPS and thus...
by garlandwhizzer
Sun Aug 21, 2016 12:11 pm
Forum: Investing - Theory, News & General
Topic: Question about bond fund duration and current SEC yield
Replies: 2
Views: 334

Re: Question about bond fund duration and current SEC yield

Kelly wrote: Where am I wrong in these three scenarios (assumes held in an IRA and interest is reinvested): 1- If rates remain unchanged the annualized return over the 7.8 year duration will be 0.4%. 2- If rates rise, there will be a NAV decline but will be reinvesting at a higher rate and will bre...
by garlandwhizzer
Fri Aug 19, 2016 7:24 pm
Forum: Investing - Theory, News & General
Topic: Growth, Value or Both?
Replies: 19
Views: 1643

Re: Growth, Value or Both?

nedsaid wrote: My portfolio pizza is already has a lot of slices and I don't think I want to keep adding more. But I suppose I will give International Small Value some thought. Do you have a fund or ETF that you recommend? I think the best SV INTL funds are run by DFA, but it is against my religion...
by garlandwhizzer
Fri Aug 19, 2016 12:08 pm
Forum: Investing - Theory, News & General
Topic: Growth, Value or Both?
Replies: 19
Views: 1643

Re: Growth, Value or Both?

nedsaid wrote: I do small/value tilt myself. The key word is tilt. I still have growth investments. Nedsaid, even though I argue for TSM, like you, I tilt to SCV but not with the lions's share of the portfolio in US equities. My tilt to SCV is larger in INTL than in US. Part of the reason for my ti...
by garlandwhizzer
Fri Aug 19, 2016 9:36 am
Forum: Investing - Theory, News & General
Topic: Growth, Value or Both?
Replies: 19
Views: 1643

Re: Growth, Value or Both?

At least part of the difference in growth versus value performance between Taylor's example and this website [url]Comparing the results of value and growth stock market indexes[/url] is that they are comparing different things. The website gives results for cost free indexes: no trading costs, no ma...
by garlandwhizzer
Wed Aug 17, 2016 1:04 pm
Forum: Investing - Theory, News & General
Topic: John Bogle says it is ok to just hold US stock index and Bond index, no international stocks
Replies: 45
Views: 5815

Re: John Bogle says it is ok to just hold US stock index and Bond index, no international stocks

dh wrote: Indeed! There is no right or wrong answer, just many approaches (I cannot think of the exact wording of Taylor's famous "many roads to Dublin" quote). Compare John Bogel's portfolio to Charles Ellis who recently stated it is ok to have US stock index fund, international stock in...
by garlandwhizzer
Wed Aug 17, 2016 12:43 pm
Forum: Investing - Theory, News & General
Topic: Better growth? Or on how the value premium ends
Replies: 216
Views: 14332

Re: Better growth? Or on how the value premium ends

Very interesting post, backpacker, thanks for posting. Poses a good question: will increased efficiency of markets due to dominance by professionals doom the pursuit of alpha?

Garland Whizzer
by garlandwhizzer
Tue Aug 16, 2016 8:12 pm
Forum: Investing - Theory, News & General
Topic: Who trades on momentum, and thus who's on the other side
Replies: 22
Views: 1975

Re: Who trades on momentum, and thus who's on the other side

Timing is critical in momentum strategies. Things that outperform in the very short term tend to keep outperforming up to a point in time at which they start underperforming. Timing is critical because if these stocks are held too long they eventually depart so far from underlying economic fundament...
by garlandwhizzer
Tue Aug 16, 2016 1:57 pm
Forum: Investing - Theory, News & General
Topic: Interesting take on where interest rates are headed
Replies: 9
Views: 1865

Re: Interesting take on where interest rates are headed

garlandwhizzer wrote: labor market reforms which are sorely needed in Europe and Japan but are politically unpopular there. boglerdude wrote in response to my post: Reforms like? For Japan I suggest reading http://voxeu.org/article/fixing-japan-s-labour-market For Europe https://www.weforum.org/age...
by garlandwhizzer
Mon Aug 15, 2016 6:38 pm
Forum: Investing - Theory, News & General
Topic: Interesting take on where interest rates are headed
Replies: 9
Views: 1865

Re: Interesting take on where interest rates are headed

The evidence thus far does not show that negative interest rate policy stimulates the economy at all. Our problem in DM is not that interest rates are too high, but rather that few credit worthy people or corporations want to borrow in order to spend that money stimulating the economy. Monetary poli...
by garlandwhizzer
Mon Aug 15, 2016 1:00 pm
Forum: Investing - Theory, News & General
Topic: The annuity puzzle, and a suggestion
Replies: 108
Views: 8377

Re: The annuity puzzle, and a suggestion

#Cruncher's post is fascinating and thorough, giving us much to think about. What the internal rate of return doesn't tell us however has to do with term risk. The longer the term, the higher the risk of two things impacting real investor returns: inflation and company viability. If your benefits ar...
by garlandwhizzer
Mon Aug 15, 2016 11:27 am
Forum: Investing - Theory, News & General
Topic: The annuity puzzle, and a suggestion
Replies: 108
Views: 8377

Re: The annuity puzzle, and a suggestion

longinvest wrote: I really like Taylor Larimore's position on SPIAs: viewtopic.php?p=2791408#p2791408 Taylor Larimore wrote: In my opinion (I once sold annuities), it is better to wait until the late 70s, or longer, for these reasons: * The premium is less or the lifetime income is larger. * You mi...

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