Search found 9788 matches

by Doc
Sat Aug 01, 2020 1:33 pm
Forum: Investing - Theory, News & General
Topic: TIPS & Inflation (expected vs. unexpected) ?
Replies: 27
Views: 1265

Re: TIPS & Inflation (expected vs. unexpected) ?

At this stage of my life, and with all sorts of weird things in recent years like inverted yield curves, I am not interested in roll down yield At this stage in my life, and with all sorts of weird things in recent months like inverted curves, I am still interested in roll down yield. That said, my...
by Doc
Sat Aug 01, 2020 1:26 pm
Forum: Investing - Theory, News & General
Topic: What is going on with short-term taxable bonds?
Replies: 31
Views: 3819

Re: What is going on with short-term taxable bonds?

I think that because of the recovery from the March kerfuffle that short term metrics are distorted by the bottoms of different assets not occuring at the same time. A lot of 30 day SEC or even 90 day returns look weird because of different bottoms. I currently use year to date periods to get aroun...
by Doc
Sat Aug 01, 2020 1:03 pm
Forum: Investing - Theory, News & General
Topic: TIPS & Inflation (expected vs. unexpected) ?
Replies: 27
Views: 1265

Re: TIPS & Inflation (expected vs. unexpected) ?

Personally since the 2008 era I have given up on TIPS completely. "TIPS are just like nominal Treasuries except for the inflation protection." NOT I never liked nominal Treasuries. Direct purchase CDs seemed like a better deal for my temperament and circumstances and stage of life. I gave up on TIP...
by Doc
Sat Aug 01, 2020 12:59 pm
Forum: Investing - Theory, News & General
Topic: TIPS & Inflation (expected vs. unexpected) ?
Replies: 27
Views: 1265

Re: TIPS & Inflation (expected vs. unexpected) ?

FIREchief wrote: Sat Aug 01, 2020 12:42 pm
Doc wrote: Sat Aug 01, 2020 12:31 pm "TIPS are just like nominal Treasuries except for the inflation protection." NOT
They are if you hold them to maturity.
I don't hold Treasury notes to maturity.
by Doc
Sat Aug 01, 2020 12:57 pm
Forum: Investing - Theory, News & General
Topic: What is going on with short-term taxable bonds?
Replies: 31
Views: 3819

Re: What is going on with short-term taxable bonds?

Still, it doesn't make sense that Short-Term Federal, which holds mostly bonds with implicit government guarantees (such as FNMA and FHLMC), has a higher SEC yield than Short-Term Corporate Bond Index, which holds almost half its bonds in BBB corporates. I'm missing something. Name, Ticker, Asset c...
by Doc
Sat Aug 01, 2020 12:31 pm
Forum: Investing - Theory, News & General
Topic: TIPS & Inflation (expected vs. unexpected) ?
Replies: 27
Views: 1265

Re: TIPS & Inflation (expected vs. unexpected) ?

Doc wrote: ↑Sat Aug 01, 2020 8:57 am Back at the beginning the storey was that TIPS were instituted by the Treasury so it could get a reading on what people expected inflation to be in the future. I personally know some of the policymakers involved and think that is too strong a statement about the...
by Doc
Sat Aug 01, 2020 9:39 am
Forum: Investing - Theory, News & General
Topic: TIPS & Inflation (expected vs. unexpected) ?
Replies: 27
Views: 1265

Re: TIPS & Inflation (expected vs. unexpected) ?

The spread between TIPS and nominal Treasuries is a function of expected inflation, a liquidity discount for TIPS (treasuries are more liquid) and an inflation insurance premium for TIPS (protecting against unexpected inflation). The liquidity discount and inflation insurance components may or may ...
by Doc
Sat Aug 01, 2020 8:57 am
Forum: Investing - Theory, News & General
Topic: TIPS & Inflation (expected vs. unexpected) ?
Replies: 27
Views: 1265

Re: TIPS & Inflation (expected vs. unexpected) ?

Back at the beginning the storey was that TIPS were instituted by the Treasury so it could get a reading on what people expected inflation to be in the future. This idea didn't work because there was no way to measure the insurance premium or the liquidity cost associated with the the bond. Some 20 ...
by Doc
Fri Jul 31, 2020 4:49 pm
Forum: Investing - Theory, News & General
Topic: SCHO [Schwab Short-Term U.S. Treasury as a cash account]
Replies: 7
Views: 1019

Re: SCHO [Schwab Short-Term U.S. Treasury as a cash account]

hoops777 wrote: Thu Jul 30, 2020 1:55 pm What are the current thoughts of using a short term treasury etf like SCHO for cash sitting in your brokerage,both IRA and taxable?
I'm using Vanguard Short-Term Treasury ETF VGSH in our Schwab accounts. :D

SCHO/SHY/VGSH basically all same. (SHY has a little higher ER.)
by Doc
Fri Jul 31, 2020 4:39 pm
Forum: Investing - Theory, News & General
Topic: Tesla becomes most valuable car company in the world
Replies: 188
Views: 17695

Re: Tesla becomes most valuable car company in the world

Enzo IX wrote: Fri Jul 31, 2020 3:03 pm A company the size of Tesla would be on an accrual accounting basis not a cash basis method.

Not paying the rent unless with this pandemic it is legal not to do so, would not fly with the GAAP accounting firms attesting to the books.
hhmmnn.
by Doc
Fri Jul 24, 2020 9:44 am
Forum: Investing - Theory, News & General
Topic: VCIT [Vanguard Intermediate-Term Corporate Bond ETF]
Replies: 31
Views: 1679

Re: VCIT [Vanguard Intermediate-Term Corporate Bond ETF]

Why do you prefer 5 years of rolling average? I don't have a preference in general. The point I was trying to make is that when there is a lot of market fluctuation the short term roll average can be misleading if you are considering a holding which which are going to keep for a long time. I do thi...
by Doc
Thu Jul 23, 2020 4:51 pm
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

I'd need to see the methodology that was used to calculate the roll-down return ("roll yield" is not a term commonly applied to bonds, but to futures--it was misused by a forum member some years ago, and unfortunately has propagated among some Bogleheads; just do a web search on "roll yield" and "r...
by Doc
Thu Jul 23, 2020 4:48 pm
Forum: Investing - Theory, News & General
Topic: VCIT [Vanguard Intermediate-Term Corporate Bond ETF]
Replies: 31
Views: 1679

Re: VCIT [Vanguard Intermediate-Term Corporate Bond ETF]

Methinks 12 month rolling is better applied to inflationary data than bond returns which I believe are more accurately viewed in a longer context.. Personally, I keep three years of RMD in a fund with lower volatility, and three years may be a bit to conservative at that. For non-short term assets ...
by Doc
Thu Jul 23, 2020 1:45 pm
Forum: Investing - Theory, News & General
Topic: Tesla becomes most valuable car company in the world
Replies: 188
Views: 17695

Re: Tesla becomes most valuable car company in the world

This is a chart from a Twitter account that is KNOWN to bait TSLA bears and ply them with false or misleading information. Saw on Fox business channel this morning that Tesla's 2nd quarter good performance was not because of increased sales but on reduced expense as the chart shows. The main reason...
by Doc
Thu Jul 23, 2020 12:32 pm
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

Using a 10y to 1y Treasury roll-down with the current yield curve, the expected roll-down return (assuming a static yield curve) is only 0.46% over 9 years, so only about 0.05% per year. The "best" way to use the roll-down yield concept is not to use a long term like a 10y to 1y but to use a period...
by Doc
Thu Jul 23, 2020 9:53 am
Forum: Investing - Theory, News & General
Topic: VCIT [Vanguard Intermediate-Term Corporate Bond ETF]
Replies: 31
Views: 1679

Re: VCIT [Vanguard Intermediate-Term Corporate Bond ETF]

Regarding Corporate Bonds: One year return of Total Bond Market 10.15% VICSX 10.85% Three year return of Total Bond Market 5.54% VICSX 6.51% Five year return of Total Bond Market 4.5% VICSX 6.03% all data from Morningstar So, what exactly have you learned Long term growth data is not necessarily the...
by Doc
Thu Jul 23, 2020 7:38 am
Forum: Investing - Theory, News & General
Topic: VCIT [Vanguard Intermediate-Term Corporate Bond ETF]
Replies: 31
Views: 1679

Re: VCIT

Yea duh. I was referring to the Swedroe advice that is often seen on this site. Duh me too. As I am hitting the "submit" key with my right hand my left hand is on Larry's bond book. :D Did you notice that my bond portfolio is very "Larry like"? I do drive by his house every now and then but I have ...
by Doc
Wed Jul 22, 2020 1:51 pm
Forum: Investing - Theory, News & General
Topic: Bond fund returns in this environment
Replies: 62
Views: 4706

Re: Bond fund returns in this environment

Elysium wrote: Wed Jul 22, 2020 6:28 am Best predictor of future bond returns are always current rates.
I think there is an addition to that idea

Best predictor of future bond returns are always current rates just not a good one.
by Doc
Wed Jul 22, 2020 12:15 pm
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

Does anyone know if the roll yield a function of only the slope of the yield curve or does the overall level of rates also affect it? The key factor is the change in the slope. You want to invest in bonds a year or three longer than the point where the curve starts to bend over and sell when it sta...
by Doc
Tue Jul 21, 2020 6:27 pm
Forum: Investing - Theory, News & General
Topic: Historically what has happened with capital gains tax changes?
Replies: 14
Views: 1512

Re: Historically what has happened with capital gains tax changes?

It is my understanding that LTCG rates are determined by when you sell the asset. Not when you bought it.

Is this the question?
by Doc
Tue Jul 21, 2020 1:53 pm
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

Stinky wrote: Tue Jul 21, 2020 1:38 pm VUSFX fits your criteria. Vanguard Ultra Short fund.
The price of VUSFX is up some 0.15% over the last month. That's 1.8% annualized. Get Jeffyscott to confirm but I think that distorts the 30 day SEC yield.
by Doc
Tue Jul 21, 2020 1:46 pm
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

It has a duration of 2 years and some volatility is expected. But are there other options with yields above 1.0 and less volatility? One is between the rock and the hard place. Vanguard Short-Term Federal Fund Admiral Shares has some 60% mortgage backed securities. The government guarantee might pr...
by Doc
Tue Jul 21, 2020 1:06 pm
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

The Vanguard Short Term Federal Fund (VSGBX/VSGDX) has an SEC rate of 1.22% as of 7/17/20. What is wrong with holding it as a substitute for a MM fund? https://i.postimg.cc/bv7B52nN/Short-Federal-Fund.jpg Some people do not like to see the price of their "cash" to go down by 1% over a couple of days.
by Doc
Tue Jul 21, 2020 11:06 am
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

Do you or anyone else out there have an opinion on which method is better? None of the above. We have a six figure holding in US Treasury securities. Of that only 20% is in funds. The rest is in actual Treasury notes or bills. There is no reason in my opinion to use a fund for Treasury obligations....
by Doc
Tue Jul 21, 2020 9:59 am
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

Clearly Vanguard and iShares are not doing the same calculation ... So much for the SEC mandate . Found an explanation: The return on TIPS, however, comes not just from interest income but also from any adjustment in value as inflation rises. The SEC hasn't issued any guidance to fund companies on ...
by Doc
Tue Jul 21, 2020 8:42 am
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

jeffyscott wrote: Mon Jul 20, 2020 4:13 pm Clearly Vanguard and iShares are not doing the same calculation ...
So much for the SEC mandate.
by Doc
Mon Jul 20, 2020 3:20 pm
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

In the case of STIP, since it holds exactly the same TIPS as VTAPX, the real SEC yield would have to be about the same. And so, it is likely that is what the figure listed as real yield is, since it is about the same " SEC-Mandated Yield The 30-day yield reported by a mutual fund uses a yield calcu...
by Doc
Mon Jul 20, 2020 11:55 am
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

At Vanguard (and I've always assumed everywhere) the "30 day SEC yield" of a TIPS fund is real yield and should be calculated the same way at Vanguard, and iShares, as it is anywhere else. Here is the info Vanguard provides at the VTIP fund performance webpage when you click on the "-0.72%" shown a...
by Doc
Sun Jul 19, 2020 2:43 pm
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

You can't compare the 30 day SEC yield of a TIPS fund with the SEC yield of a nominal treasury fund Why not? If the inflation over the last 30 days was 1% wouldn't the ending value of that fund increase by 1% also. The 30 day yield is backward looking so any increase in value due to inflation would...
by Doc
Sun Jul 19, 2020 12:46 pm
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

They don't subsidize, they just magically "limit certain net operating expenses in excess of the fund’s daily yield in order to maintain a zero or positive yield for the fund". You do see the difference between a subsidy and arbitrarily reducing expense to less than 1/2 of actual expenses in 2015, ...
by Doc
Sun Jul 19, 2020 11:14 am
Forum: Investing - Theory, News & General
Topic: 0.00% Yield on the Vanguard Short-Term Treasury Fund
Replies: 203
Views: 16126

Re: 0.00% Yield on the Vanguard Short-Term Treasury Fund

... if VG weren't subsidizing the expenses. I don't understand that. If Vanguard's fund are "owned by the shareholders" where do they get the money to subsidize the MM fund except from the shareholders of that fund. And if the fund is not earning anything there is no money to do the subsidizing. Th...
by Doc
Sat Jul 18, 2020 3:35 pm
Forum: Investing - Theory, News & General
Topic: Behavior of TIPS versus Treasuries in March
Replies: 141
Views: 7040

Re: Behavior of TIPS versus Treasuries in March

Two things were going on in March that you're seeing in these charts. One was a liquidity shock that manifested across virtually all classes of bonds in one way or another. A liquidity crisis like this is rare (happens maybe a few days per decade, on average), unpredictable, and idiosyncratic. I th...
by Doc
Thu Jul 16, 2020 9:01 am
Forum: Investing - Theory, News & General
Topic: Vanguard Ultra-Short-Term Bond Fund now available
Replies: 96
Views: 35223

Re: Vanguard Ultra-Short-Term Bond Fund now available

I like VUBFX for money that might be needed short-term, but where most of the fund will be invested for at least a year. The higher yield than alternatives more than made up for the dip earlier this year, especially if only a small amount or none was sold. I'm more forgiving of a somewhat lower rat...
by Doc
Wed Jul 15, 2020 3:55 pm
Forum: Investing - Theory, News & General
Topic: individual bonds vs bond funds
Replies: 36
Views: 1896

Re: individual bonds vs bond funds

Thus, I second this recommendation: HawkeyePierce wrote: ↑Wed Jul 15, 2020 10:16 am For a 50/50 split between Treasurys and corporates, I would just buy BIV, Vanguard's intermediate bond fund. It's 50% intermediate term Treasurys and 50% intermediate term investment-grade corporates. It's longer du...
by Doc
Tue Jul 14, 2020 6:38 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Ultra-Short-Term Bond Fund now available
Replies: 96
Views: 35223

Re: Vanguard Ultra-Short-Term Bond Fund now available

U But why bother? Settlement account probably has a higher yield than SHV's 0 (maybe as much as 0.01% ) and, anyway, at least can't be lower? You are looking only at the 7/30 day SEC yield and ignoring the trailing 12 month yield. Same problem as basing a decision on VUBFX based on the 30 day yield....
by Doc
Tue Jul 14, 2020 3:47 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Ultra-Short-Term Bond Fund now available
Replies: 96
Views: 35223

Re: Vanguard Ultra-Short-Term Bond Fund now available

Going back to the Vanguard Ultra-Short-Term Bond Fund, as of today its allocation is reported at 37% asset-backed, 28% finance and 20% industrial. I don't quite understand the "finance" bond sector. Would that be banks, investment firms issuing bonds? Just so happens that I looked at the ultra shor...
by Doc
Tue Jul 14, 2020 10:57 am
Forum: Investing - Theory, News & General
Topic: Morningstar: No more SEC Yield display?
Replies: 8
Views: 724

Re: Morningstar: No more SEC Yield display?

M* has made some completely incomprehensible data display decisions in the last couple of years. They've broken the useful of charting by excluding dividends from ETF growth charts, and now they've hidden the most important datum that I'd want to know for a bond fund. It's still there but it is hid...
by Doc
Mon Jul 13, 2020 10:43 am
Forum: Investing - Theory, News & General
Topic: Why is the stock market up? [thread multi-merge]
Replies: 521
Views: 21793

Re: How is this possible -- stock market continues to soar.

My cash and bond balances continue to go up, and I just refer to it as growing my emergency fund or increasing the safe portion of our Liability Matching Portfolio. Your bond balances are going up because interest rates are going down. If you don't add more then the balance will return to its appro...
by Doc
Wed Jul 08, 2020 4:13 pm
Forum: Investing - Theory, News & General
Topic: Vanguard Prime Money Market Fund
Replies: 75
Views: 6302

Re: Vanguard Prime Money Market Fund

Maybe someone who is a bond expert can address whether the convexity issue is much more muted with such a short duration. I am not a bond expert other than what I got from reading Swedroe's bond book several times. That said: In general I would avoid MBS as if it was Covid. But the negativity conve...
by Doc
Mon Jun 29, 2020 9:02 am
Forum: Investing - Theory, News & General
Topic: Bond funds - Why no bonds under 1 year.
Replies: 12
Views: 821

Re: Bond funds - Why no bonds under 1 year.

Bond funds make a lot of their money by "rolling down the yield curve" i.e making roll return. I thought about that. But the roll down yield effect is often greatest when the short end is in the three plus year range. I didn't think there was much effect in the 3 to 1 range. But maybe that's the an...
by Doc
Mon Jun 29, 2020 8:57 am
Forum: Investing - Theory, News & General
Topic: Bond funds - Why no bonds under 1 year.
Replies: 12
Views: 821

Re: Bond funds - Why no bonds under 1 year.

jason2459 wrote: Mon Jun 29, 2020 8:48 am Are you looking for a mutual fund or ETF with an effective duration under a year?
No I have the less that one year handled with some ETFs but mostly with a T-Bill ladder.

I was just curious about "bond" funds/ETFs.
by Doc
Mon Jun 29, 2020 8:34 am
Forum: Investing - Theory, News & General
Topic: Bond funds - Why no bonds under 1 year.
Replies: 12
Views: 821

Bond funds - Why no bonds under 1 year.

Other than money market funds most fixed income funds have no bonds with maturities under one year. What's the reasoning?

If it's just the index then why the does index stop at one year?
by Doc
Sun Jun 28, 2020 9:06 am
Forum: Investing - Theory, News & General
Topic: Is there any financial downside to spreading your portfolio over multiple accounts?
Replies: 18
Views: 1203

Re: Is there any financial downside to spreading your portfolio over multiple accounts?

One advantage of a single account is that you can re-balance easier than with multiple accounts. And if you want to add or withdraw money, you only have to do it one place instead of multiple places. Let me rephrase that. One disadvantage of a single account is that you can only re-balance in that ...
by Doc
Sat Jun 27, 2020 11:53 am
Forum: Investing - Theory, News & General
Topic: Weird Short Corporate ETF Price Chart
Replies: 2
Views: 310

Re: Weird Short Corporate ETF Price Chart

I'm surprised no one else has posted & it makes me wonder if I'm stating the obvious... https://www.federalreserve.gov/newsevents/pressreleases/monetary20200615a.htm Since I'm not getting what is weird about this, perhaps it'll at least bump the thread Thanks. I thought that might be the reason but...
by Doc
Fri Jun 26, 2020 4:09 pm
Forum: Investing - Theory, News & General
Topic: Weird Short Corporate ETF Price Chart
Replies: 2
Views: 310

Weird Short Corporate ETF Price Chart

Using VG Short Corp ETF VSCH as an example.

15 day:
Image

1 day:
Image

The equivalent Schwab ETF had a similar spike at the same time, around 2:15 E.

Any ideas what was going on?
by Doc
Fri Jun 26, 2020 1:05 pm
Forum: Investing - Theory, News & General
Topic: What famous investing quote reminds you of your investing style?
Replies: 150
Views: 7564

Re: What famous investing quote reminds you of your investing style?

UpperNwGuy wrote: Tue Jun 16, 2020 5:41 am "Buy and hold."
That reminds me of my style because I don't. :D
by Doc
Wed Jun 24, 2020 10:37 am
Forum: Investing - Theory, News & General
Topic: Schwab Mutual Fund fees
Replies: 8
Views: 963

Re: Schwab Mutual Fund fees

Does Charles Schwab charge $49.95 every time you buy shares in an external mutual fund, or is it just the initial buy in? Schwab has an excellent chat service that could answer this question in <10min. That will give only one answer. For multiple answers, this forum is the best :-) Which is better ...
by Doc
Wed Jun 24, 2020 10:07 am
Forum: Investing - Theory, News & General
Topic: A bond duration glide path for retirement investing
Replies: 61
Views: 4784

Re: A bond duration glide path for retirement investing

mhc wrote: Tue Jun 23, 2020 3:59 pm If a person only knew when he would die, planning would be so easy.
That's easy to do by using a 457 plan. :D
by Doc
Wed Jun 17, 2020 9:22 am
Forum: Investing - Theory, News & General
Topic: Swedroe’s Bond Advice - no total bond index
Replies: 195
Views: 17477

Re: Swedroe’s Bond Advice - no total bond index

So you are saying investment grade corporate bonds are equity? Swedroe makes the point that corporate bonds have equity type risk. The longer the maturity the higher the risk. This does not mean that corporate bonds have the same risk as equites. It just means that corporate bonds have a risk compo...