Search found 216 matches

by hafius500
Sat Nov 15, 2014 11:51 am
Forum: Investing - Help with Personal Investments
Topic: 30% In International Stocks?
Replies: 59
Views: 10271

Re: 30% In International Stocks?

a) Is it even possible for a zero-return , high-volatility, low-correlation asset to improve a portfolio? I think this is a mathematical impossibility, UNLESS the correlation is truly negative , not just for a fleeting moment, but permanently, robustly, strongly, over the long term. David Swenson h...
by hafius500
Wed Aug 06, 2014 1:47 pm
Forum: Investing - Theory, News & General
Topic: not all small value funds are created equal
Replies: 48
Views: 5178

Re: not all small value funds are created equal

Here's another paper that seems to defend the existence of a large-cap value premium. I saved the link but I haven't read it. Is There a Value Premium Among Large Stocks?, Sandro C. Andrade, University of Miami - Department of Finance, Vidhi Chhaochharia, University of Miami, April 2014 Abstract: Ac...
by hafius500
Fri Aug 01, 2014 2:42 pm
Forum: Investing - Theory, News & General
Topic: Prove adding SV will lower the risk, given the same E(r)
Replies: 79
Views: 5898

Re: Prove adding SV will lower the risk, given the same E(r)

... One thing I find interesting here is I think it is widely accepted that bonds have multiple dimensions of risk (default risk, interest rate risk, call risk, inflation risk etc), with associated risk premiums. For example depending on use one might care a lot or not at all about inflation risk, ...
by hafius500
Sat Jul 19, 2014 2:20 pm
Forum: Investing - Help with Personal Investments
Topic: Living on Dividends
Replies: 18
Views: 5114

Re: Living on Dividends

Rob Arnott: Climb away from the glide path, says blue-sky thinker, Mike Foste, 16 Jul 2014 In each case, he assumes that an individual is contributing $1,000 a year to a plan in real terms. The conventional switch from an 80% equity weighting to 20% produces an average retirement pot of $124,460. Bu...
by hafius500
Wed Jul 16, 2014 3:50 pm
Forum: Investing - Theory, News & General
Topic: Bet it ALL on Small Cap Value when you're young
Replies: 64
Views: 9201

Re: Bet it ALL on Small Cap Value when you're young

That is TRUE IF the market is efficient, a premise. Not a fact. We do know that while the market is highly efficient it isn't perfectly so and you are better or, or would have been better off if you screened out all stocks with lottery like characteristics, gotten higher returns and lower SD, both....
by hafius500
Thu Jul 10, 2014 1:47 pm
Forum: Investing - Theory, News & General
Topic: International exposure: does it really help?
Replies: 75
Views: 10318

Re: International exposure: does it really help?

And, how about this time period, which is essentially "all available data?" This is a Rorschach test and everyone is going to see different things in it, but I realize that I (and everyone else) needs to be able to recall the salient features by heart. These are inflation-corrected, and (of course)...
by hafius500
Mon Jun 02, 2014 1:02 pm
Forum: Investing - Theory, News & General
Topic: "Brokers, Liquid Alts and the Fund That Never Goes Up"
Replies: 7
Views: 993

Re: "Brokers, Liquid Alts and the Fund That Never Goes Up"

Pragmatic Capitalism - Economists Usually aren’t good Asset Managers, by Cullen Roche, Wednesday, May 28th, 2014 comments on the quoted article: ...Economists tend to have a totally different mindset than asset managers. Economists tend to have... The bottom line: when picking an asset manager be c...
by hafius500
Sat May 10, 2014 2:45 pm
Forum: Investing - Theory, News & General
Topic: Jeremy Grantham article [Bull market will "end badly"]
Replies: 22
Views: 4652

Re: Jeremy Grantham article [Bull market will "end badly"]

I don't know if these returns are correct: A Check-Up on GMO Fund Performance, May 11, 2014 ...Grantham’s investment firm, GMO, is considered an expert on asset price bubbles... The only problem with this strategy is that there’s being early and being way early....: Annual returns (2004-2013) GMO Gl...
by hafius500
Wed May 07, 2014 1:29 pm
Forum: Investing - Theory, News & General
Topic: Is equity diversification over-hyped?
Replies: 45
Views: 4463

Re: Is equity diversification over-hyped?

James Picerno recently published the results of a Monte-Carlo simulation. Unfortunately, I don't see important data like the average or median returns: James Picerno - Luck, Skill And Concentrated Portfolios, May. 5, 2014 Buffett’s investing record is widely attributed to skill...But as an intellect...
by hafius500
Sat May 03, 2014 1:53 pm
Forum: Investing - Theory, News & General
Topic: Fama/French Factors: "A Come-to-Buffet Moment" (from M*)
Replies: 74
Views: 6890

Re: Fama/French Factors: "A Come-to-Buffet Moment" (from M*)

...Having small, value, and market risk helps us accomplish the same thing. Likewise for term risk and default risk in bonds. I can't understand why anyone buys emerging market bonds. Such behavior looks insane to me. I would rather hold a smaller allocation of treasuries and more equities. But peo...
by hafius500
Thu Apr 24, 2014 1:38 pm
Forum: Investing - Theory, News & General
Topic: Another take on the "rebalancing bonus"
Replies: 105
Views: 20027

Re: Another take on the "rebalancing bonus"

Sorry, if this article already has been posted: Does Rebalancing Reduce Risk? April 22nd, 2014, by Michael Edesess The second article has been published: While the buy-and-hold strategy has a greater standard deviation of ending wealth than the rebalancing strategy, that greater standard deviation i...
by hafius500
Thu Apr 17, 2014 3:06 pm
Forum: Investing - Theory, News & General
Topic: Japan Does not Show That Stocks are Dangerous
Replies: 79
Views: 7536

Re: Japan Does not Show That Stocks are Dangerous

... I believe I do know (a good central estimate of) the long-term future return on stocks, and in Japan 1990 and USA 2000 it was insanely low, about 1% and 2% respectively, and my allocation (if my current strategy were applied to those circumstances) would consequently have been zero. In fact my ...
by hafius500
Sat Apr 12, 2014 4:54 pm
Forum: Investing - Theory, News & General
Topic: Cambria Global Value - Value Tilt
Replies: 44
Views: 8024

Re: Cambria Global Value - Value Tilt

The strategy isn't entirely new. Other funds have pursued a top-down strategy that selects the "cheapest" country markets. For example, the Tweedy broschures quoted a study by Michael Keppler that concluded that high-yielding equity markets outperformed low-yielding equity markets. . Keppler's funds...
by hafius500
Sat Apr 12, 2014 3:19 pm
Forum: Investing - Help with Personal Investments
Topic: Investor from Finland
Replies: 50
Views: 2857

Re: Investor from Finland

It has often been written on this forum that "capitalizing funds are superior". I want to stress that any advantage or disadvantage depends on national tax laws that can be completely different. For example, consider these (national) tax laws that make capitalizing funds less attractive: 1) Capitali...
by hafius500
Sat Apr 12, 2014 1:44 pm
Forum: Investing - Theory, News & General
Topic: A Bubble in Value Stocks?
Replies: 31
Views: 4001

Re: A Bubble in Value Stocks?

I don't like that value funds sell their winners as soon as they start winning. Running my own fund, I can keep the winners until they turn into extreme growth stocks (say, bottom 20% using some sort of simple value measure). It may be a mistake to sell strong growth stocks: Guggenheim S&P SmallCap...
by hafius500
Tue Mar 04, 2014 4:57 pm
Forum: Investing - Theory, News & General
Topic: Why do investors prefer cash dividends?
Replies: 126
Views: 8520

Re: Why do investors prefer cash dividends?

Ogd, Well I just did a small amount of research and take a look at this paper: Marginal Stockholder Tax Effects & Ex-Dividend-Day Price Behavior Evidence from Taxable versus Non-Taxable Closed -End Funds (Elton, Gruber, Blake-- NYU Stern). Here is the first sentence from the abstract: "Almost all r...
by hafius500
Thu Feb 27, 2014 2:17 pm
Forum: Investing - Theory, News & General
Topic: Who invests in Small Value - US & International only?
Replies: 52
Views: 7754

Re: Who invests in Small Value - US & International only?

Rick Ferri recently released his excellent 30 year forecast, and he lowered the small value expected return due to popularity if I am correct. No expert ever studied has shown any skill at making these sorts of predictions. These should be treated as no different from fun party games. IMHO. Even if...
by hafius500
Sat Jan 18, 2014 3:42 pm
Forum: Investing - Theory, News & General
Topic: SA: Why I'm Not A Passive Investor
Replies: 19
Views: 3011

Re: SA: Why I'm Not A Passive Investor

When passive investors buy an asset class, they buy at whatever price the seller asks. And when they sell, they sell at whatever price the buyer offers. The "passive" is not about the choice of assets - again, someone has to choose them - it refers instead to passively accepting whatever price the ...
by hafius500
Sat Jan 11, 2014 5:26 pm
Forum: Investing - Theory, News & General
Topic: misguided interest in div strategies
Replies: 200
Views: 20481

Re: misguided interest in div strategies

ogd, On your chart showing the supposed advantage of dividends in a crisis did not show up in 2008. - 2008 was a brief downturn, and quite a shallow one compared to 1929. I'd like to protect against a long and maybe deep down market. - The kind of chart you showed doesn't include a retiree's withdr...
by hafius500
Tue Jan 07, 2014 4:39 pm
Forum: Investing - Theory, News & General
Topic: Nice article by Larry Swedroe about defining value stocks
Replies: 5
Views: 1065

Re: Nice article by Larry Swedroe about defining value stock

What is value? "Value is in the eye of the beholder," at least that's how I look at it. One index company can classify a stock as a value stock and another company can classify it as a growth stock (*). If value is in the eye of the beholder no value investor can expect to beat the market except by...
by hafius500
Sat Dec 21, 2013 2:51 pm
Forum: Investing - Theory, News & General
Topic: misguided interest in div strategies
Replies: 200
Views: 20481

Re: misguided interest in div strategies

nedsaid What I disagree with is Larry's constant crusade against dividend strategies I am simply pointing out that a) it isn't the dividends that determine/explain the returns of a strategy--so why focus on dividends----it's other factors. And thus you should focus on what matters, not what doesn't...
by hafius500
Sat Nov 09, 2013 5:16 pm
Forum: Investing - Theory, News & General
Topic: It's not different for me. Is it for you?
Replies: 54
Views: 6391

Re: It's not different for me. Is it for you?

No passive investor ever closes their eyes and takes their hands off the wheel. There is always work to be done - rebalancing, investment of new capital, withdrawals...Rick Ferri A short digression: According to standard definitions 'passive' portfolios are not rebalanced. Moreover, there are 'unco...
by hafius500
Sat Oct 26, 2013 1:17 pm
Forum: Investing - Theory, News & General
Topic: Smart beta equals factor tilts
Replies: 93
Views: 6873

Re: Smart beta equals factor tilts

Ok if you don't like gold, 70/30 TSM/LTT still beats 100% TSM in return and SD over the time period. Do you really want to argue that every author of every asset allocation book who gives an example of how diversification works (usually in the first or second chapter) is wrong ? everything I've rea...
by hafius500
Mon Oct 21, 2013 3:21 pm
Forum: Investing - Theory, News & General
Topic: Buy High Dividend Stocks and Ignore The Noise
Replies: 71
Views: 8819

Re: Buy High Dividend Stocks and Ignore The Noise

In all likelihood, someone who invests in high-dividend stocks and withdraws and spends only the dividends will leave less than someone who invests in the total market and withdraws and spends only the dividends. Do you have any data that support this assertion? Some back-tested studies suggest tha...
by hafius500
Mon Oct 21, 2013 12:42 pm
Forum: Investing - Theory, News & General
Topic: Smart beta equals factor tilts
Replies: 93
Views: 6873

Re: Smart beta equals factor tilts

Based on their 10 million Monte Carlo simulations choosing constituent weights randomly—applying weights that could have been chosen by monkeys—would also have produced a better risk-adjusted performance than that produced by a cap-weighted scheme. A new article discusses possible mathematical erro...
by hafius500
Sat Oct 19, 2013 1:55 pm
Forum: Investing - Theory, News & General
Topic: Buy High Dividend Stocks and Ignore The Noise
Replies: 71
Views: 8819

Re: Buy High Dividend Stocks and Ignore The Noise

...But this is what the old-timers did before we knew about asset allocation, 500+ company index fund diversification and safe withdrawal rates. They bought high quality blue chip stocks with good dividends and lived off that. Ignoring market movements, by and large.... Actually, it's about dividen...
by hafius500
Thu Oct 10, 2013 1:56 pm
Forum: Investing - Theory, News & General
Topic: Why the currency concern over too much foreign holdings?
Replies: 71
Views: 6372

Re: Why the currency concern over too much foreign holdings?

...'why do people go to such great lengths to make a serious active tilt away from the global market portfolio and treat it as if it were a default approach?' I guess it dates back to the days where international investing was hard, expensive, etc... FYI: two articles on the home bias that I can re...
by hafius500
Thu Oct 10, 2013 4:07 am
Forum: Investing - Theory, News & General
Topic: Why the currency concern over too much foreign holdings?
Replies: 71
Views: 6372

Re: Why the currency concern over too much foreign holdings?

An investment in a Peruvian company, for example, is subject to two different sources of fluctuation stacked on top of each other. One is the actual fluctuation in the stock's value, in Peruvian Nuevo Sols, on the Peruvian Bolsa de Valores. The other is the fluctuation in the number of dollars a Pe...
by hafius500
Thu Oct 10, 2013 4:01 am
Forum: Investing - Theory, News & General
Topic: Why the currency concern over too much foreign holdings?
Replies: 71
Views: 6372

Re: Why the currency concern over too much foreign holdings?

The different opinions you hear derive from different assumptions about the way currencies are valued. Many who advise holding foreign currency shares say that currencies fluctuate over time with zero resulting FX gains/losses. But consider the poor Swiss and Japanese who held US stock for 30 years...
by hafius500
Mon Sep 30, 2013 2:56 pm
Forum: Investing - Theory, News & General
Topic: [Vanguard Announces New Low Volatility Fund]
Replies: 91
Views: 17388

Re: [Vanguard Announces New Low Volatility Fund]

You must distinguish between low-volatility strategies and minimum-volatility strategies. Robeco, Whitepaper for institutional investors, How Smart is ‘Smart Beta’ Investing?, December 2012 Possible disadvantages of minimum-volatility indices: - lack of transparancy (the optimisation algorithm is se...
by hafius500
Sun Sep 29, 2013 1:41 pm
Forum: Investing - Theory, News & General
Topic: Rafi Fundamental weighting schemes
Replies: 25
Views: 2417

Re: Rafi Fundamental weighting schemes

If you own an S&P 500 index fund or the Total Stock Market index fund, you should be outraged that Research Affiliates and other firms are calling you a dumb investor! FWIW IMO this is the silly kind of statement that is written just to create controversy I have never heard anyone call a market ind...
by hafius500
Wed Sep 25, 2013 2:32 pm
Forum: Investing - Theory, News & General
Topic: Bernstein acording to Edesess "Stocks for the Long Run"
Replies: 28
Views: 3070

Re: Bernstein acording to Edesess "Stocks for the Long Run"

It is interesting that you brought that up. I heard a money manager by the name of Jeff Auxier speak at a seminar. He said that in all of history that there were only about 6 countries that never defaulted on its debt. The US is one of them. Eventually, most every government at some point defaults....
by hafius500
Wed Sep 25, 2013 1:40 pm
Forum: Investing - Theory, News & General
Topic: Bernstein acording to Edesess "Stocks for the Long Run"
Replies: 28
Views: 3070

Re: Bernstein acording to Edesess "Stocks for the Long Run"

Real bonds have no inflation risk only if reported inflation (used to adjust their prices and yields) matches actual economic inflation. Nearly all serious economic research (not the tin foil hat claims that show up on web sites) have concluded that the CPI overstates, not understates, actual infla...
by hafius500
Tue Sep 24, 2013 2:54 pm
Forum: Investing - Theory, News & General
Topic: Bernstein acording to Edesess "Stocks for the Long Run"
Replies: 28
Views: 3070

Re: Bernstein acording to Edesess "Stocks for the Long Run"

In 2008-2009, the US Stock Market dropped by over 50%. You say that I am ignoring out of sample data, but that is still risk. Ask anyone who retired right about then. My gosh!!! NO. E.g., after World War II investors in government bonds lost nearly 100 %. Either the bonds were declared worthless (s...
by hafius500
Tue Sep 24, 2013 2:26 pm
Forum: Investing - Theory, News & General
Topic: great companies --are they high returning stocks?
Replies: 4
Views: 741

Re: great companies --are they high returning stocks?

the authors Thomas Peters and Robert Waterman identified six financial indicators of excellent companies: - Five-year growth of total assets - Five-year growth of shareholder equity - Five-year return on sales - Five-year average return on average total capital - Five-year average return on average...
by hafius500
Tue Sep 24, 2013 1:49 pm
Forum: Investing - Theory, News & General
Topic: Bernstein acording to Edesess "Stocks for the Long Run"
Replies: 28
Views: 3070

Re: Bernstein acording to Edesess "Stocks for the Long Run"

But market volatility or "shallow" risk...is still risk and it is very real and it can show up at any time. This is why most of us have a good helping of bonds in the portfolio. As we get older, we cannot stomach the volatility of a 100% stock portfolio. A target date portfolio with a glidepath tha...
by hafius500
Fri Sep 20, 2013 1:29 pm
Forum: Investing - Theory, News & General
Topic: Overweighting Small Caps in TSM??
Replies: 22
Views: 1762

Re: Overweighting Small Caps in TSM??

The existence of a size premium is debatable (emphasis added): Factor This Into Your Portfolio (Part 2 of 2, August 22, 2013 By Rick Ferri The question of factor premium persistence is especially important considering the costs of pursuing this strategy are always higher. Many people have observed t...
by hafius500
Mon Sep 16, 2013 2:08 pm
Forum: Investing - Theory, News & General
Topic: my thoughts on the smart beta debate
Replies: 7
Views: 1292

Re: my thoughts on the smart beta debate

To begin, there can be many portfolios that have the same loading or exposure to beta. Let's assume that we start with a mutual fund (Fund A) that owns the total U.S. market. By definition, it will have a beta of 1. Then, the manager of Fund B says that we can create smarter beta by screening out a...
by hafius500
Fri Sep 13, 2013 12:42 pm
Forum: Investing - Help with Personal Investments
Topic: Dividend, growth investment strategy
Replies: 98
Views: 13643

Re: Dividend, growth investment strategy

I assume the strategy you and grayfox have in mind is similar to the strategy of the ING Corporate Leaders Trust: Not exactly like that but close. If I were going to run a strategy of this sort here is what I'd do: 1) Start with a fairly simple stock screen: Dividend Yield > 2%, 5 yr EPS growth > 0...
by hafius500
Tue Sep 10, 2013 1:46 pm
Forum: Investing - Help with Personal Investments
Topic: Dividend, growth investment strategy
Replies: 98
Views: 13643

Re: Dividend, growth investment strategy

I'm not sure I would consider buying TSM a proper dividend growth strategy. In fact, if you're really serious about it I'm not sure index funds are appropriate. One of the key features is the infinite holding period which theoretically makes price changes irrelevant. With an index fund you can't be...
by hafius500
Tue Sep 10, 2013 6:54 am
Forum: Investing - Theory, News & General
Topic: Severe criticism of DFA's "profitability" factor research
Replies: 103
Views: 18236

Re: Severe criticism of DFA's "profitability" factor researc

Seems odd that he goes after DFA but fails to even mention Novy-Marx and his academic work. It is my understanding that all the DFA papers and strategy comes from that original academic source which has been peer reviewed. "Over time, tilts towards value, momentum and profitability have outperforme...
by hafius500
Tue Sep 10, 2013 4:15 am
Forum: Investing - Help with Personal Investments
Topic: Dividend, growth investment strategy
Replies: 98
Views: 13643

Re: Dividend, growth investment strategy

Those statistics are nowhere near as cut-and-dried or certain as advocates make it out to be. And statements like "went down LESS during market [downturns] such as 2008 crash" because when you actually check them out, if it is even true, it always turns out to mean something like "Yeah, then went d...
by hafius500
Sun Sep 08, 2013 3:55 am
Forum: Investing - Theory, News & General
Topic: emerging markets have investors panicking
Replies: 142
Views: 16802

Re: emerging markets have investors panicking

Cap weighting is not representative of the population sizes, geographical coverage, or economic output of EM, How is this possible? Shoudn't it be representative in an equilibrium? If investors believed that a segment of the real economy (e.g. REITs) is not truly represented by the cap-weighted mar...
by hafius500
Sat Sep 07, 2013 1:45 pm
Forum: Investing - Help with Personal Investments
Topic: Dividend, growth investment strategy
Replies: 98
Views: 13643

Re: Dividend, growth investment strategy

Hi Folks, I been reading up and started studying a bit about a 'dividend - growth' portfolio strategy. Stats show top dividend stocks historically (last 5, 10, 15, 25 yrs from what i been researching so far) has consistently BEAT the market and also went down LESS during market down-towns such as 2...
by hafius500
Wed Sep 04, 2013 2:44 pm
Forum: Investing - Help with Personal Investments
Topic: Tilting to Small-Caps or REITs
Replies: 26
Views: 2871

Re: Tilting to Small-Caps or REITs

...The much-ballyhooed small company effect was discovered in 1981, and by 1983 Robert Arnott wrote A growing body of evidence exists that small-capitalization stocks significantly outperform large-capitalization stocks. This effect is so strong and so consistent that even advocates of the Efficien...
by hafius500
Thu Aug 29, 2013 1:37 pm
Forum: Investing - Theory, News & General
Topic: Effect of dividend & interest rates on safe withdrawal rate
Replies: 12
Views: 1161

Re: Effect of dividend & interest rates on safe withdrawal r

Today we have a dividend yield of 2.02% on the S&P 500... Given the very low portfolio yields today, it seems quite unlikely that retirement portfolios can sustain anything near the safe withdrawal rates found in previous research studies. Retirees are forced to liquidate investment principal at a ...
by hafius500
Sat Aug 24, 2013 4:41 pm
Forum: Investing - Theory, News & General
Topic: International allocation for an Euro currency country?
Replies: 15
Views: 1415

Re: International allocation for an Euro currency country?

I agree with the replies of, e.g., assetchaos or Hanseat. Most "suggested" allocations are based on some prior back-testing to see what allocation would have the optimal result for "minimum variance" or total return during a selected time period. It's ultimately an individual decision and should tak...
by hafius500
Tue Aug 20, 2013 2:31 pm
Forum: Investing - Theory, News & General
Topic: Other Investment Strategies
Replies: 39
Views: 5119

Re: Other Investment Strategies

...Furthermore, no sane person would ever sell their gold for worthless fiat money once hyperinflation was underway. Do you really think anyone in Weimar was actively choosing to trade their gold for fiat money that was being hyperinflated by the hour? No way. Germans were doing everything they cou...
by hafius500
Tue Aug 20, 2013 1:27 pm
Forum: Investing - Theory, News & General
Topic: Swedroe On Int'l Allocation
Replies: 38
Views: 5441

Re: Swedroe On Int'l Allocation

Noob, first, a little gift for you: The global investing strategy is a favorite of academic theorists, some of whom recommend that the ideal equity portfolio should consist of holdings of each nation's stocks at their world-market weight. A pity he doesn't name the theorists or cite sources, but I ...