Search found 1331 matches

by garlandwhizzer
Wed Jun 08, 2016 11:38 am
Forum: Investing - Theory, News & General
Topic: "Negative interest rates: What they are and what they mean."
Replies: 10
Views: 1874

Re: "Negative interest rates: What they are and what they mean."

Bonds provide two critical things: safety and income. US bonds are in my opinion safer than foreign bonds especially EM bonds not only because they are denominated in our own spending currency but also because our bond markets are deeper, well-regulated, and more transparent than many INTL markets. ...
by garlandwhizzer
Tue Jun 07, 2016 1:56 pm
Forum: Investing - Theory, News & General
Topic: low rates = fewer bonds? active asset allocation?
Replies: 14
Views: 1561

Re: low rates = fewer bonds? active asset allocation?

The point is well made that nominal bond returns are far more predictable than nominal stock returns. We know that quality short or intermediate duration bonds are likely to return their nominal yields over the bond"s duration, which today is close to a zero in real inflation-adjusted return. T...
by garlandwhizzer
Mon Jun 06, 2016 1:49 pm
Forum: Investing - Theory, News & General
Topic: Rob Arnott: Capital Market Expectations [video]
Replies: 5
Views: 942

Re: Rob Arnott: Capital Market Expectations [video]

I find this video interesting and thanks for posting it. Rob Arnott is not a snake oil barker but a thoughtful analyst of market history. He relies a great deal in estimating future returns of asset classes on the power of mean reversion and on Shiller PE 10's predictability for subsequent 10 year r...
by garlandwhizzer
Sun Jun 05, 2016 4:57 pm
Forum: Investing - Theory, News & General
Topic: Equity Crowdfunding
Replies: 18
Views: 1665

Re: Equity Crowdfunding

In my opinion penny stocks are an area of the market to stay away from. Sales commissions on these are very high, it is almost impossible to get accurate information about the companies covered in the penny stock area, and those that peddle them tend to be sharks feasting on the uninformed. Check ou...
by garlandwhizzer
Sun Jun 05, 2016 12:08 pm
Forum: Investing - Theory, News & General
Topic: Equity Crowdfunding
Replies: 18
Views: 1665

Re: Equity Crowdfunding

boglerocks wrote: As for whether I can beat the market, I refuse to assume that I can't without trying (and sizing my buy-ins appropriately). I wish you the best of luck in this endeavor. Decades ago, when markets were in my opinion less efficient than now, I constantly tried to beat the market wit...
by garlandwhizzer
Sat Jun 04, 2016 5:03 pm
Forum: Investing - Theory, News & General
Topic: Equity Crowdfunding
Replies: 18
Views: 1665

Re: Equity Crowdfunding

This is a quote directly from FundersClub webpage: FundersClub is the only online startup investing platform to regularly report returns. I don't know much about crowdfunding but I'll throw in my 2 cents worth. One likely explanation of why other equity crowdfunding entities don't report their resu...
by garlandwhizzer
Thu Jun 02, 2016 7:00 pm
Forum: Investing - Theory, News & General
Topic: Bill Gross and his June 2016 investment outlook
Replies: 50
Views: 6002

Re: Bill Gross and his June 2016 investment outlook

lack_ey wrote: Not seeing anything particularly earth-shattering there, though admittedly the points about for example the negative nominal yields abroad and fairly flat yield curves here and there have merit. Maybe these and some of the other indicators just point to lower volatility, maybe decent...
by garlandwhizzer
Thu Jun 02, 2016 2:45 pm
Forum: Investing - Theory, News & General
Topic: Bill Gross and his June 2016 investment outlook
Replies: 50
Views: 6002

Bill Gross

[Thread merged into here, see below. --admin LadyGeek] From Bill's most recent news letter: For over 40 years, asset returns and alpha generation from penthouse investment managers have been materially aided by declines in interest rates, trade globalization, and an enormous expansion of credit – t...
by garlandwhizzer
Thu Jun 02, 2016 1:30 pm
Forum: Investing - Theory, News & General
Topic: Should I use margin to buy a balanced fund?
Replies: 891
Views: 169308

Re: Should I use margin to buy a balanced fund?

Should I use margin to buy a balanced fund? No.

Garland Whizzer
by garlandwhizzer
Thu Jun 02, 2016 1:22 pm
Forum: Investing - Theory, News & General
Topic: Argument for and against holding international fund
Replies: 18
Views: 2141

Re: Argument for and against holding international fund

US equities have outperformed INTL equities over the last 20 years and also over the very long term since 1900. Does that mean this outperformance will continue? The answer to that question is a definite maybe, maybe not. Regardless of what the past relative performance of US versus INTL tells us, t...
by garlandwhizzer
Wed Jun 01, 2016 1:02 pm
Forum: Investing - Theory, News & General
Topic: Is S&P 500 P/E ratio really at 24?
Replies: 18
Views: 3387

Re: Is S&P 500 P/E ratio really at 24?

I am not an accountant but it seems to me that earnings figures and hence PE ratios like everything else in accounting can be manipulated. First of all as JoMoney points out, there is the difference between past 12 months earnings and the next 12 months or next year's estimated earnings. The next tw...
by garlandwhizzer
Wed Jun 01, 2016 11:58 am
Forum: Investing - Theory, News & General
Topic: Wall Street Potholes
Replies: 5
Views: 1147

Re: Wall Street Potholes

Thanks for this excellent post, Larry. The remarkable thing is how difficult it is to stop these amoral practices in the financial industry. Scamming and deceptive advertising will continue until the clients who provide the money, the investors themselves, get educated about financial markets and do...
by garlandwhizzer
Mon May 30, 2016 3:02 pm
Forum: Investing - Theory, News & General
Topic: JD Mellberg 8% Lifetime Return Claim - Legitimate?
Replies: 43
Views: 24805

Re: JD Mellberg 8% Lifetime Return Claim - Legitimate?

This is simple. There is no way that anyone can guarantee a 8% return on invested money and return of principal for a significant time period in the current environment. The numbers simply don't work. Either you lose or JD Mellberg does and goes out of business in which case its guarantees disappear...
by garlandwhizzer
Sun May 29, 2016 2:33 pm
Forum: Investing - Theory, News & General
Topic: Simplegift and Dr. Bernstein
Replies: 20
Views: 2815

Simplegift and Dr. Bernstein

I would like to express my thanks to Simplegift and to Dr. Bernstein for their posts, especially their recent posts which I find enlightening and thought provoking. Their efforts to help the rest of us get a deeper understanding of financial markets are much appreciated by me and, I suspect, many ot...
by garlandwhizzer
Sun May 29, 2016 2:21 pm
Forum: Investing - Theory, News & General
Topic: Classic Bernstein 4 — Stocks Always Beat Bonds?
Replies: 19
Views: 3464

Re: Classic Bernstein 4 — Stocks Always Beat Bonds?

jalbert wrote: Are the current expected real returns of equities at historic lows, or is it just expected nominal returns? My understanding is that both nominal and real expected returns in the foreseeable future, say the next 5 - 10 years, will be lower than historical averages but not the histori...
by garlandwhizzer
Sat May 28, 2016 12:46 pm
Forum: Investing - Theory, News & General
Topic: Classic Bernstein 8 — Is Credit Risk Ever Worth Taking?
Replies: 20
Views: 2694

Re: Classic Bernstein 8 — Is Credit Risk Ever Worth It?

Totally agree on this good point. I bought Vanguard's HYB fund (which avoids the worst of junk bonds) during the worst of the collapse in 2008-9 at which time the spread to Treasuries of similar maturities was greater than 11%. I sold some of my GNMA fund at the time which had held up beautifully du...
by garlandwhizzer
Wed May 25, 2016 6:39 pm
Forum: Investing - Theory, News & General
Topic: Why do we believe in the market?
Replies: 59
Views: 6228

Re: Why do we believe in the market?

bjr89 wrote: Something that seems to elude many people is that stocks fell almost 90% from peak to trough due to the Great Depression, and they didn't recover to the previous high until 1954. There is no reason this couldn't happen again -- and it could take longer to recover, or never recover at a...
by garlandwhizzer
Wed May 25, 2016 12:17 pm
Forum: Investing - Theory, News & General
Topic: Patience makes perfect
Replies: 7
Views: 1434

Re: Patience makes perfect

SGENX, as others have stated, has a high cost structure (5% load, 1.11% expense ratio) and at least for me is not an investment option. It's philosophy: patience, discipline, and insight in value investing is essentially the same strategy that the Oracle of Omaha has used and is a solid one. In succ...
by garlandwhizzer
Mon May 23, 2016 2:30 pm
Forum: Investing - Theory, News & General
Topic: The Perils of Historical Asset Returns
Replies: 19
Views: 2251

Re: The Perils of Historical Asset Returns

Great post, Simplegift. I tend to agree with the premise that although the future is not predictable there are basic macroeconomic factors present today which suggest but do not guarantee lower than historical equity, bond, and real asset returns going forward for perhaps a decade or more. I don't b...
by garlandwhizzer
Mon May 23, 2016 2:08 pm
Forum: Investing - Theory, News & General
Topic: Why do we believe in the market?
Replies: 59
Views: 6228

Re: Why do we believe in the market?

notsobright wrote: In the end, aren't we all just gambling since we don't know for certain what the market will be like? We're all assuming that the market will have positive returns over the course of our lifetimes. Is that a safe assumption? The only thing that you know with certainty about the f...
by garlandwhizzer
Sat May 21, 2016 12:34 pm
Forum: Investing - Theory, News & General
Topic: Stocks, Bonds, and "Real Assets" (TIPS, REITs, Commodities)
Replies: 28
Views: 2602

Re: Stocks, Bonds, and "Real Assets" (TIPS, REITs, Commodities)

callguy1 wrote: So they recommended upping the real assets/alternatives bucket focusing on high 8%+ dividends, since those will 1) keep up with inflation and 2) produce some real return from the income even if there's 20 years of stagnation. Question: where do they find 8%+ dividends these days? I ...
by garlandwhizzer
Thu May 05, 2016 12:45 pm
Forum: Investing - Theory, News & General
Topic: Backtesting David Swensen Lazy Porfolio against Three Fund
Replies: 57
Views: 9605

Re: Backtesting David Swensen Lazy Porfolio against Three Fund

nisi wrote: 5) The argument for the three-fund portfolio is not "it's better." The argument is that there's no way to be sure anything else is better, and that investors who focus on "the best" instead of "good enough" are likely to have trouble staying the course beca...
by garlandwhizzer
Tue May 03, 2016 1:47 pm
Forum: Investing - Theory, News & General
Topic: P2P Real Estate Investing
Replies: 8
Views: 2336

Re: P2P Real Estate Investing

Direct quote from the article referred to above: But because you’re not competing in the well-developed 30-year residential mortgage market, you can expect to collect annual interest in the 7-10% range, rather than the 3-4% that mortgage securities pay their owners. In current market conditions any...
by garlandwhizzer
Tue May 03, 2016 1:25 pm
Forum: Investing - Theory, News & General
Topic: Why Are Real Interest Rates So Low Worldwide?
Replies: 87
Views: 10220

Re: Why Are Real Interest Rates So Low Worldwide?

Bernanke's article on "helicopter money" is very enlightening for those interested in its theory which suggests potential positive effects when central banks have run out of all other alternatives to stimulate growth and fight deflation. The problem, he suggests, is in the exact details of...
by garlandwhizzer
Sun May 01, 2016 1:29 pm
Forum: Investing - Theory, News & General
Topic: Classic Bernstein 1 — Asset Allocation and Time Horizon
Replies: 47
Views: 7930

Re: Classic Bernstein — Asset Allocation and Time Horizon

Simplegift wrote: a) Since the best performing asset classes (or factors) can’t be known in advance, it’s impossible to specify exactly what the best asset allocation will be in the coming decades. As long-term investors, all we can do is choose a portfolio allocation that meets our expected return...
by garlandwhizzer
Sun May 01, 2016 1:10 pm
Forum: Investing - Theory, News & General
Topic: Fundamental Indexing Is The Better Way To Value Tilt?
Replies: 19
Views: 2341

Re: Fundamental Indexing Is The Better Way To Value Tilt?

Given a certain time period it is incredibly easy on backtesting to create a portfolio with the exact mixture of beta, small, value, momentum, etc., to maximize returns, get rid of negative alpha, and reduce portfolio volatility sufficiently to create a higher Sharpe ratio. Anyone moderately accompl...
by garlandwhizzer
Fri Apr 29, 2016 4:41 pm
Forum: Investing - Theory, News & General
Topic: Major stock shareholder effect
Replies: 4
Views: 404

Re: Major stock shareholder effect

I do not buy or sell individual stocks any more. I've been that route many years ago and learned that for most of us, it is a losing proposition. But if I did...I would not be inclined to sell any of my APPL position because Icahn did. Rather I would be more inclined to buy it now. Nothing has chang...
by garlandwhizzer
Fri Apr 29, 2016 1:09 pm
Forum: Investing - Theory, News & General
Topic: McKinsey report on diminishing returns
Replies: 91
Views: 7947

Re: McKinsey report on diminishing returns

There are several things that make our age different from prior eras and therefore cast some doubt on the reliability of achieving historical rates of return going forward. The biggest two factors in the US (and all developed economies) are debt and demographics. Ultimately this, combined with curre...
by garlandwhizzer
Thu Apr 28, 2016 12:08 pm
Forum: Investing - Theory, News & General
Topic: McKinsey report on diminishing returns
Replies: 91
Views: 7947

Re: McKinsey report on diminishing returns

Robert T wrote: Start saving early, have an equity orientation (Swensen), diversify globally, keep costs low, have realistic expectations (and reduce 'behavioral mistakes'). Great post, Robert T. This is in my opinion the take home message. Given current circumstances (as well as any circumstances a...
by garlandwhizzer
Wed Apr 27, 2016 12:41 pm
Forum: Investing - Theory, News & General
Topic: Why Are Real Interest Rates So Low Worldwide?
Replies: 87
Views: 10220

Re: Why Are Real Interest Rates So Low Worldwide?

It seems to me the goal of QE is to stimulate the economy by lowering interest rates beyond what can be achieved with standard monetary policy. In theory lower interest rates should stimulate borrowing by individuals and corporations which then spend the money and stimulate economic activity. This e...
by garlandwhizzer
Mon Apr 25, 2016 12:45 pm
Forum: Investing - Theory, News & General
Topic: Smart-Beta War Rages On as Cliff Asness Slams Pimco Star's Paper
Replies: 6
Views: 1058

Re: Smart-Beta War Rages On as Cliff Asness Slams Pimco Star's Paper

Time will tell who's right and who's wrong in this debate. Or perhaps both the EM dominated portfolio of Arnott based on current attractive valuations and the multi-factor portfolio of Asness will underperform a simple low cost TSM + TISM fund portfolio in the long run. Asness and Arnott are bright,...
by garlandwhizzer
Sun Apr 24, 2016 1:55 pm
Forum: Investing - Theory, News & General
Topic: Barron's: The Real Alternative in Multi-Alts (AQR's QSPIX featured)
Replies: 13
Views: 1412

Re: Barron's: The Real Alternative in Multi-Alts (AQR's QSPIX featured)

nedsaid wrote: Garland, I actually would consider investing in such a fund. I have three difficulties in investing in such funds. First, my eyes glaze over when I read the posts explaining how these things work. Second, I have to trust that the folks who run such funds actually know what they are d...
by garlandwhizzer
Sun Apr 24, 2016 1:33 pm
Forum: Investing - Theory, News & General
Topic: Arnott's Echoes of 1999: The Tech Bubble and the "Asian Flu"
Replies: 8
Views: 1235

Re: Arnott's Echoes of 1999: The Tech Bubble and the "Asian Flu"

Very good and insightful posts, Simplegift, as usual for you. After an absence of posting for a time, it's nice to have you back, Todd.

Garland Whizzer
by garlandwhizzer
Sat Apr 23, 2016 6:29 pm
Forum: Investing - Theory, News & General
Topic: Barron's: The Real Alternative in Multi-Alts (AQR's QSPIX featured)
Replies: 13
Views: 1412

Re: Barron's: The Real Alternative in Multi-Alts (AQR's QSPIX featured)

The first paragraph of the article: So far, the funds in Morningstar’s new multi-alternative category have mainly proved to be an alternative to making actual money. To date, these poor-man’s hedge funds have eked out a meager 1.6% five-year annualized return, compared with 11.6% for stocks and 3.7%...
by garlandwhizzer
Thu Apr 21, 2016 10:03 pm
Forum: Investing - Theory, News & General
Topic: Bond Fund Strategy?
Replies: 26
Views: 3348

Re: Bond Fund Strategy?

The bond market is very efficient at pricing risk based on current real time information, more so in my opinion than the stock market. One of the few certainties you can count on is this: if a fixed income product is offering a higher interest rate, it also has higher inherent risk which includes a ...
by garlandwhizzer
Wed Apr 20, 2016 12:25 pm
Forum: Investing - Theory, News & General
Topic: A different look at the Shiller CAPE 10
Replies: 29
Views: 3248

Re: A different look at the Shiller CAPE 10

Excellent article, Larry, thanks. And excellent comments especially Rick's. It provides a bit of balm to soothe the shattered nerves created by the doomsters. I certainly hope these future projections (5%+ real US equity returns going forward) turn out to be true. I do not wish to rain on this optim...
by garlandwhizzer
Tue Apr 19, 2016 1:09 pm
Forum: Investing - Theory, News & General
Topic: Stock picking services
Replies: 39
Views: 2894

Re: Stock picking services

Looking at the apparent success of stock picking services (25% gain was spoken of), the question of luck versus skill is a tricky one especially when a short time frame is our data reference. In a sense as has been pointed out all active management funds are run by stock pickers, buying only the goo...
by garlandwhizzer
Mon Apr 11, 2016 8:31 pm
Forum: Investing - Theory, News & General
Topic: I'm Calling an Emerging Markets Bottom
Replies: 223
Views: 34240

Re: I'm Calling an Emerging Markets Bottom

In retrospect grap0013 made a good call on EM and has profited from it. I agree with him that EM equity valuations are still attractive relative to DM and especially to US. There is clearly more political risk, more corruption, more currency risk, and more instability in EM, but those risks are full...
by garlandwhizzer
Mon Apr 11, 2016 12:01 pm
Forum: Investing - Theory, News & General
Topic: Annuities and longevity risk, analyzing the problem
Replies: 45
Views: 4544

Re: Annuities and longevity risk, analyzing the problem

Great article, Larry, thanks for explaining the complexity of choosing when to annuitize and which product to use for those considering such options. The IRA distribution deferred annuity makes sense from both a tax and longevity risk point of view. A couple of potential problems with deferred annui...
by garlandwhizzer
Sat Apr 09, 2016 12:34 pm
Forum: Investing - Theory, News & General
Topic: Disappearing premiums!
Replies: 150
Views: 18487

Re: Disappearing premiums!

nedsaid wrote: Markets do have moods. When they are pessimistic, they can't stand good news. Conversely, optimistic markets shake off bad news. I just don't buy that markets are rational all of the time. I look at value as quality stocks that are out of favor for some reason. That reason might be t...
by garlandwhizzer
Fri Apr 08, 2016 7:42 pm
Forum: Investing - Theory, News & General
Topic: Review of AQR Equity Market Neutral & Long-Short Equity
Replies: 44
Views: 4724

Re: Review of AQR Equity Market Neutral & Long-Short Equity

lack_ey wrote: It's kind of strangely coincidental and bizarre that you only really talked about the options, whereas the fund actually does significantly use swaps, futures, and forwards. I used the word options a lot but all the derivatives potentially used by QLEIX (swaps, futures, forward conta...
by garlandwhizzer
Fri Apr 08, 2016 3:00 pm
Forum: Investing - Theory, News & General
Topic: Review of AQR Equity Market Neutral & Long-Short Equity
Replies: 44
Views: 4724

Re: Review of AQR Equity Market Neutral & Long-Short Equity

lack_ey wrote: AQR Long/Short Equity Fund (QLEIX, QLENX, QLERX) doesn't use options, though, which you have repeatedly mentioned, unless I've missed something. AQR's QLEIX strategy information for investors mention that they employ derivatives and that those derivatives may lose more principal than...
by garlandwhizzer
Fri Apr 08, 2016 1:53 pm
Forum: Investing - Theory, News & General
Topic: Alpha or Assets
Replies: 1
Views: 288

Re: Alpha or Assets

Interesting piece, thanks for posting. The basic premise has merit. One problem is that a highly concentrated portfolio of optimal stocks focusing strictly on alpha and not at all on scale is not available to most investors. When it does well money pours in and soon it of necessity switches to a sca...
by garlandwhizzer
Thu Apr 07, 2016 8:48 pm
Forum: Investing - Theory, News & General
Topic: Review of AQR Equity Market Neutral & Long-Short Equity
Replies: 44
Views: 4724

Re: Review of AQR Equity Market Neutral & Long-Short Equity

lack_ey wrote in response to my post: Sorry, color me confused, but which fund are you even talking about? Ticker symbol? Which funds are heavily using options? Sorry, the fund I was describing was QLEIX, AQR'S LONG SHORT EQUITY FUND. It has done quite well since inception relative to long only or ...
by garlandwhizzer
Tue Apr 05, 2016 1:15 pm
Forum: Investing - Theory, News & General
Topic: "Simple vs. Complex"
Replies: 12
Views: 2040

Re: "Simple vs. Complex"

Great post, Taylor, thanks. I think the time course for many investors through a lifetime of investing starts with maximal complexity (individual stock picking with a broker, frequent trading). After some bad experiences there, we move to a collection mutual funds, most actively managed, often a com...
by garlandwhizzer
Tue Apr 05, 2016 12:51 pm
Forum: Investing - Theory, News & General
Topic: Review of AQR Equity Market Neutral & Long-Short Equity
Replies: 44
Views: 4724

Re: Review of AQR Equity Market Neutral & Long-Short Equity

The AQR long short option fund has done quite well since its inception, but the short time frame is short. I do not know whether this success is due to luck or skill. Nor do I know, even if it is due to skill, will this out-perfmance persist going forward? If due to luck, one suspects that it will n...
by garlandwhizzer
Wed Mar 30, 2016 2:09 pm
Forum: Investing - Theory, News & General
Topic: screening on buyback yield
Replies: 5
Views: 747

Re: screening on buyback yield

If you're really interested in screening for buyback yield, you should look at PKW, the PowerShares BuyBack Achievers™ Portfolio Fund which is based on the NASDAQ US BuyBack Achievers™ Index. From the prospectus: The Fund will normally invest at least 90% of its total assets in common stocks that co...
by garlandwhizzer
Tue Mar 29, 2016 1:06 pm
Forum: Investing - Theory, News & General
Topic: No Intl. DM, Just Intl. EM? [International Developed Markets, Emerging Markets]
Replies: 23
Views: 2276

Re: No Intl. DM, Just Intl. EM? [International Developed Markets, Emerging Markets]

I believe that EM, INTL SC, and especially EM SC offer better diversification and likely better long term returns in a US dominated portfolio than LC DM (which is a lot like US LC) or cap weight INTL index. My equity portfolio currently is 50% US (75% TSM/25% VBR),12.5% EM SCV (DGS)/12.5 EM cap weig...
by garlandwhizzer
Tue Mar 29, 2016 12:41 pm
Forum: Investing - Theory, News & General
Topic: 3% annuity costs a little more than a CPI-U adjusted one
Replies: 17
Views: 1594

Re: 3% annuity costs a little more than a CPI-U adjusted one

Taylor wrote: I would not choose now. I think you should probably put-off purchasing a lifetime annuity (SPIA) until your late 70's or early 80s. There are many reasons: * Inflation is less important so the cost of an "inflation-rider" may be avoided. * The cash premium might be needed fo...
by garlandwhizzer
Tue Mar 29, 2016 12:24 pm
Forum: Investing - Theory, News & General
Topic: Foot Locker stock up ~2% after announcement of inclusion in S&P 500. Contradiction of EMH?
Replies: 15
Views: 1589

Re: Foot Locker stock up ~2% after announcement of inclusion in S&P 500. Contradiction of EMH?

One way to overcome the index reconstitution market inefficiency (which is a very small factor anyway in the big picture) is to use TSM as your index. The stock that is announced to go into the S&P 500 index goes one way in price, up or down, and the one omitted from the index goes the other way...

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