Search found 1380 matches

by garlandwhizzer
Mon Jan 16, 2017 12:18 pm
Forum: Investing - Theory, News & General
Topic: The gulf between MOM fund returns and MOM factor returns
Replies: 30
Views: 1782

Re: The gulf between MOM fund returns and MOM factor returns

Robert T wrote: The very large negative alpha on the AQR momentum funds is concerning, something the iShares fund has managed to avoid so far. https://www.portfoliovisualizer.com/fac ... ssetType=1 Not sure if the same momentum approach is used in the AQR multi-factor strategies, but if so, would a...
by garlandwhizzer
Sun Jan 15, 2017 4:57 pm
Forum: Investing - Theory, News & General
Topic: The gulf between MOM fund returns and MOM factor returns
Replies: 30
Views: 1782

The gulf between MOM fund returns and MOM factor returns

MOM has produced robust factor returns on long term and even short term backtesting (9% premium according to Larry's recent excellent book, greater even that beta returns, and with greater persistence of results). Many sophisticated factor posters on this forum advocate AQR as a firm who understands...
by garlandwhizzer
Fri Jan 13, 2017 5:23 pm
Forum: Investing - Theory, News & General
Topic: VMMXX-Vanguard Prime Money Market is 55% Yankee/Foreign
Replies: 25
Views: 2537

Re: VMMXX-Vanguard Prime Money Market is 55% Yankee/Foreign

justinvest wrote: Well, the fact remains that Vanguard *itself* does not think VMMXX is safe enough to clear their own customer's trades through it. I mentioned the realities of the MM fund regulation reforms of 2016 earlier, and those reforms are the reason why VMMXX is not deemed safe enough. Ins...
by garlandwhizzer
Fri Jan 13, 2017 1:41 pm
Forum: Investing - Theory, News & General
Topic: "2016 Shows That Factors Are Fickle"
Replies: 45
Views: 3497

Re: "2016 Shows That Factors Are Fickle"

Bill Bernstein is an intelligent, knowledgeable, rational, and experienced student of the market in my opinion. In his latest book, RATIONAL EXPECTATIONS, he writes the following about multi-factor approaches. [quote]As I write this, mutual fund and etf providers are already rolling out products tha...
by garlandwhizzer
Wed Jan 11, 2017 8:47 pm
Forum: Investing - Theory, News & General
Topic: AQR Relaxed Constraint Equity Funds
Replies: 26
Views: 2542

Re: AQR Relaxed Constraint Equity Funds

Stated simply, because there is a plausible theoretical argument for increased risk adjusted returns in complex multi-style and style premia funds does not mean that they will achieve increased risk-adjusted return. It is possible but not certain, like everything else in markets. What is certain is ...
by garlandwhizzer
Wed Jan 11, 2017 12:48 pm
Forum: Investing - Theory, News & General
Topic: 2016 Callan Periodic Table of Investment Returns
Replies: 27
Views: 3519

Re: 2016 Callan Periodic Table of Investment Returns

The table visually makes a good case for wide diversification and reversion to the mean.

Garland Whizzer
by garlandwhizzer
Wed Jan 11, 2017 12:41 pm
Forum: Investing - Theory, News & General
Topic: VMMXX-Vanguard Prime Money Market is 55% Yankee/Foreign
Replies: 25
Views: 2537

Re: VMMXX-Vanguard Prime Money Market is 55% Yankee/Foreign

VMMXX is in my opinion one of the safest places in the world to park money and preserve capital, safer than any short term or intermediate term bond instrument for that purpose. The weighted average life of the credit instruments in their portfolio is 88 days, less than 3 months, and their credit qu...
by garlandwhizzer
Sat Jan 07, 2017 12:49 pm
Forum: Investing - Theory, News & General
Topic: Treasury returns historically almost match corporate bonds?
Replies: 9
Views: 937

Re: Treasury returns historically almost match corporate bonds?

Treasuries have done wonderfully well over the past 3+ decades, offering not only safety but also excellent return especially adjusted for risk. However, like Bogle, I wouldn't rule out owning some corporate bonds. In an increasing interest rate, increasing inflation environment, which is what we ex...
by garlandwhizzer
Fri Jan 06, 2017 11:44 am
Forum: Investing - Theory, News & General
Topic: Timing small caps vs. large caps using valuation
Replies: 5
Views: 619

Re: Timing small caps vs. large caps using valuation

Small caps and SCV in particular have had quite a run in the past year. Some of this is the natural swing in the pendulum from the preceding years in which SC underperformed LC and V underperformed G for a period of years. Assets have moved into SC and particularly SCV in the past year for a number ...
by garlandwhizzer
Tue Jan 03, 2017 5:25 pm
Forum: Investing - Theory, News & General
Topic: Whats your number to walk away?
Replies: 245
Views: 28603

Re: Whats your number to walk away?

I defined my number for stock/bond portfolio at 1.6 Mil. When I was 50, single, no kids, no other income, and my portfolio hit that number I retired. I assumed at that time (1997) that I would average a real return of 7%+/yr. I was much more optimistic 20 years ago about future expected returns than...
by garlandwhizzer
Tue Jan 03, 2017 11:40 am
Forum: Investing - Theory, News & General
Topic: Diversifying SCV with MTUM: yea or nay?
Replies: 29
Views: 1692

Re: Diversifying SCV with MTUM: yea or nay?

Just my two cents worth again. When it comes to factors I think MOM is robust theoretically but very hard to harvest in an after cost fashion. If you're a factor investor I believe that value particularly in the SC space is a more harvestable alternative for long term investors. It, too, has its cha...
by garlandwhizzer
Mon Jan 02, 2017 1:29 pm
Forum: Investing - Theory, News & General
Topic: Diversifying SCV with MTUM: yea or nay?
Replies: 29
Views: 1692

Re: Diversifying SCV with MTUM: yea or nay?

My two cents worth. Back to the original question is SCV + the MTUM (large cap long only) MOM fund a good pairing? If you are a firm believer in factor investing and have no interest in plain beta I think one can make a case for this approach. MOM looks great on backtesting, robust premiums, but the...
by garlandwhizzer
Fri Dec 30, 2016 2:10 pm
Forum: Investing - Theory, News & General
Topic: Bernstein-"To Make Money They Didn't Need".....and Pascal's Wager
Replies: 187
Views: 19615

Re: Bernstein-"To Make Money They Didn't Need".....and Pascal's Wager

Larry's comments are, as usual, insightful and cogent but I'll offer a few points to consider. For those lucky ones who have an asset base large enough to allow for a very high allocation to safe but low return bond investments and take less overall equity risk, concentrating it in higher expected r...
by garlandwhizzer
Wed Dec 28, 2016 11:45 am
Forum: Investing - Theory, News & General
Topic: Does Vanguard always have our best interests in mind?
Replies: 55
Views: 4804

Re: Does Vanguard always have our best interests in mind?

I am surprised by the ire that some on the Forum hold for Vanguard which is far and away more dedicated to client's interests in my view than any other financial firm. If you're upset that V has increased INTL and also equity relative to bond holdings, then you have the simple option not to follow t...
by garlandwhizzer
Mon Dec 26, 2016 1:45 pm
Forum: Investing - Theory, News & General
Topic: Pimco Income Fund vs. Vanguard Total Bond Market
Replies: 51
Views: 4316

Re: Pimco Income Fund vs. Vanguard Total Bond Market

lack_ey wrote: I have not looked at the fund much and would need to study a lot of other things more to have a real opinion, but here is my take on using the fund: You should be very wary of putting a heavy weighting in any very actively managed strategy (manager risk) The fund is relatively narrow...
by garlandwhizzer
Mon Dec 26, 2016 1:04 pm
Forum: Investing - Theory, News & General
Topic: David Swensen says "never have anything weighted more than 30%"
Replies: 42
Views: 4493

Re: David Swensen says "never have anything weighted more than 30%"

CaBob wrote:
Swensen is apparently talking about one of his personal rules. I'm almost positive that he is not suggesting that it is an appropriate rule for all investors.


1+

Garland Whizzer
by garlandwhizzer
Sun Dec 25, 2016 12:35 pm
Forum: Investing - Theory, News & General
Topic: Comparing Ferri and Malkiel's Bond Portfolios
Replies: 14
Views: 2063

Re: Comparing Ferri and Malkiel's Bond Portfolios

I believe that the bond market is very efficient at pricing risk, more so than the equity market. Whenever any bond asset or bond substitute yields more than high quality bonds it is overwhelmingly likely that more risk comes with it in exact proportion to its increased yield, risk being defined as ...
by garlandwhizzer
Wed Dec 21, 2016 12:30 pm
Forum: Investing - Theory, News & General
Topic: VBR higher p/e than VTI & lower growth
Replies: 17
Views: 1629

Re: VBR higher p/e than VTI & lower growth

Everything, VBR, VTI, VOO, etc., in the US seems generously valued relative to historical norms. Switching from one to another at this point may not make a lot of difference in short or even perhaps intermediate term returns. Had you switched a year ago into VBR after long years of its underperforma...
by garlandwhizzer
Wed Dec 21, 2016 12:14 pm
Forum: Investing - Theory, News & General
Topic: The Argument for More Stocks in Retirement
Replies: 166
Views: 12845

Re: The Argument for More Stocks in Retirement

Rapporteur, if you are certain you can emotionally tolerate a very severe decline in you asset base and stick with 100% stocks through thick and thin, it will likely maximize long term returns. Few of us can do that and many who believe they can discover during the depths a severe equity decline tha...
by garlandwhizzer
Sat Dec 17, 2016 11:56 am
Forum: Investing - Theory, News & General
Topic: Retreat to cash
Replies: 223
Views: 24018

Re: Retreat to cash

The question of course: Is the big run-up in stocks after Trump's election (which was anticipated to have the opposite result) a harbinger of the future or yet another example of market noise and over-reaction based on an imagined economic future. I admit I don't know, but if I were forced to bet (I...
by garlandwhizzer
Mon Dec 12, 2016 1:31 pm
Forum: Investing - Theory, News & General
Topic: Burton Malkiel bashes Total Bond Market
Replies: 16
Views: 3817

Re: Burton Malkiel bashes Total Bond Market

nedsaid wrote:
Probably most investors today have only seen interest rates fall and it doesn't occur to them that interest rates can have a secular trend upward as well as down.


1+

We are always prepared for the last war, rarely for the next one.

Garland Whizzer
by garlandwhizzer
Mon Dec 12, 2016 12:35 pm
Forum: Investing - Theory, News & General
Topic: Burton Malkiel bashes Total Bond Market
Replies: 16
Views: 3817

Re: Burton Malkiel bashes Total Bond Market

I think Malkiel's main point is not that bonds are bad that but a steady 40% allocation to bonds which has worked well in the past may not work well in the future. We have been in a 30+ year bull market in bonds, the greatest bond bull in US history, and it has been accompanied by ever decreasing in...
by garlandwhizzer
Tue Dec 06, 2016 12:07 pm
Forum: Investing - Theory, News & General
Topic: Nice short Vanguard videos on factor based investing
Replies: 31
Views: 3079

Re: Nice short Vanguard videos on factor based investing

Larry wrote in response to my questions:
Hope that is helpful
Larry


A very helpful post with keen insight as usual.

Garland Whizzer
by garlandwhizzer
Mon Dec 05, 2016 8:17 pm
Forum: Investing - Theory, News & General
Topic: Nice short Vanguard videos on factor based investing
Replies: 31
Views: 3079

Re: Nice short Vanguard videos on factor based investing

Larry wrote: FWIW, your assumption on 1999 is off. Here are returns 1927-99 LG 10.7 LV 12 SG 10.4 SV 14.3 Sorry for the mistake, Larry, and thanks for pointing it out. I'm getting old and my memory of the Telltale Chart was inaccurate. Next time I'll look it up before I speak. I would like to bring...
by garlandwhizzer
Mon Dec 05, 2016 12:54 pm
Forum: Investing - Theory, News & General
Topic: I'm Calling an Emerging Markets Bottom
Replies: 223
Views: 34965

Re: I'm Calling an Emerging Markets Bottom

I was very positive on EM at least until I saw the GS piece. GS warned of a serious decline in gold and PME in 2/2016 and reiterated it in 7/2016. <http://www.kitco.com/news/2015-07-22/Goldman-Sachs-Calls-For-1-000-Gold.html> Their initial call was made almost exactly when the price of gold and PME ...
by garlandwhizzer
Mon Dec 05, 2016 12:37 pm
Forum: Investing - Theory, News & General
Topic: Nice short Vanguard videos on factor based investing
Replies: 31
Views: 3079

Re: Nice short Vanguard videos on factor based investing

privatefarmer wrote: Larry - I apologize if this is in your book (I am currently in the middle of the newest one), but what factor premium would you expect after one has already maxed out the beta/small/value factors? If one were to add additional factors beyond these three (ie momentum, profitabil...
by garlandwhizzer
Thu Dec 01, 2016 12:36 pm
Forum: Investing - Theory, News & General
Topic: Global bonds suffer worst monthly meltdown, cause for concern?
Replies: 46
Views: 6666

Re: Global bonds suffer worst monthly meltdown, cause for concern?

The last month's activity in the bond market is IMHO, more noise than signal. The good news about bonds is that even when they have a "meltdown," losses are modest. For most of us who wish to sleep at night, bonds are an essential portfolio ingredient. Personally, I think it unwise to flee...
by garlandwhizzer
Wed Nov 30, 2016 12:33 pm
Forum: Investing - Theory, News & General
Topic: Three fund portfolio for retirement
Replies: 79
Views: 9944

Re: Three fund portfolio for retirement

Erwin wrote: What is simply being proposed here is replacing the total bond index fund for TIPS. But the total bond index fund is currently yielding(SEC yield) a bit over 2%. That seems to me not much more than the expected inflation. If I am right, either way you have the same problem, except that...
by garlandwhizzer
Tue Nov 29, 2016 6:19 pm
Forum: Investing - Theory, News & General
Topic: Paul Merriman challenges John Bogle
Replies: 157
Views: 13920

Re: Paul Merriman challenges John Bogle

When it comes to stature in the financial community and furthering the financial health of individual investors, comparing Merriman to Bogle is like comparing a dwarf (Merriman) to a giant (Bogle). As for factor, specifically SCV, investing versus cap weight indexes there is no doubt that based on c...
by garlandwhizzer
Tue Nov 29, 2016 1:52 pm
Forum: Investing - Theory, News & General
Topic: Three fund portfolio for retirement
Replies: 79
Views: 9944

Re: Three fund portfolio for retirement

Taylor wrote: Bogleheads: The big unknown costs in retirement are medical costs which can often exceed $100,000 (I already know). The average lifetime retirement health care premium costs for a 65-year-old healthy couple retiring this year and covered by Medicare Parts B, D, and a supplemental insu...
by garlandwhizzer
Mon Nov 28, 2016 1:56 pm
Forum: Investing - Theory, News & General
Topic: I'm calling a bond bottom.
Replies: 31
Views: 6986

Re: I'm calling a bond bottom.

In my experience calling a top or a bottom to any market at any time is exceptionally difficult. It becomes slightly less hazardous when a given market is at an all time high or an all time low, hopefully with valuation metrics several standard deviations away from the mean, like bonds in 1982 and s...
by garlandwhizzer
Sun Nov 27, 2016 12:59 pm
Forum: Investing - Theory, News & General
Topic: Retirees: Where are you going for income?
Replies: 102
Views: 15572

Re: Retirees: Where are you going for income?

This is a bit off topic (sorry) but I'm retired and I prefer a total return approach rather than an income focused approach. Income producing assets are currently richly priced due to their popularity and hence produce paltry levels of income relative to historical standards. REITS produced 9%+ yiel...
by garlandwhizzer
Thu Nov 24, 2016 1:35 pm
Forum: Investing - Theory, News & General
Topic: Q&A With Jack Bogle: ‘We’re in the Middle of a Revolution’
Replies: 26
Views: 4232

Re: Q&A With Jack Bogle: ‘We’re in the Middle of a Revolution’

No matter how old Jack is or how old he looks, he comes off brighter, sharper, and more on target than anyone who ever interviews him. It never fails to lift my spirits when I read his comments and realize that a giant such as he chooses to spend his time and focus on improving investing results for...
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: 5577

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: 8958

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: 8958

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: 2168

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: 2168

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: 5178

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: 13531

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: 5289

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: 2044

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: 9186

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: 2177

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: 3195

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: 3672

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: 3672

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: 1080

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: 3838

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: 2931

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...

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