Search found 842 matches

by jdilla1107
Fri Oct 04, 2019 8:58 am
Forum: Investing - Theory, News & General
Topic: 'Stay the course' with international stock but give up on value?
Replies: 101
Views: 7544

Re: 'Stay the course' with international stock but give up on value?

Just relying on the S&P 500 alone for US stocks is a horrible strategy as we saw in the Dotcom bust. Small Value was underweight technology going into the dotcom bust. Maybe this was predictive. Maybe it was an accident. But, were you really more diversified by being underweight technology in one o...
by jdilla1107
Fri Oct 04, 2019 8:46 am
Forum: Investing - Theory, News & General
Topic: 'Stay the course' with international stock but give up on value?
Replies: 101
Views: 7544

Re: 'Stay the course' with international stock but give up on value?

This is a poor analogy and a straw man argument. - International stocks are a sector of the world economy. By adding international stocks you are adding new companies to your portfolio. Adding new companies increases your diversification against idiosyncratic risk. (Whether it's necessary to lower t...
by jdilla1107
Thu Oct 03, 2019 11:55 am
Forum: Investing - Theory, News & General
Topic: Google or other tech buys in a downturn
Replies: 14
Views: 968

Re: Google or other tech buys in a downturn

Ha ha I don't have one. Just a software engineer Is the primary reason you would buy tech because you are in the industry? Will tech decide to outperform the other sectors because you work in software engineering? People often times load up on their own companies stock because it's what in front of...
by jdilla1107
Wed Oct 02, 2019 5:16 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value is now just anti-technology
Replies: 30
Views: 2994

Re: Small Cap Value is now just anti-technology

the value premium is robust wrt how value is defined. This statement makes no sense. I don't even understand how someone can write that sentence. What are the bounds for how I need to define value for it to be robust? My point on giving quotes on value investing is that the word becomes meaningless...
by jdilla1107
Wed Oct 02, 2019 2:26 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value is now just anti-technology
Replies: 30
Views: 2994

Re: Small Cap Value is now just anti-technology

Yes, my recollection is that the original Fama-French study also found a value premium when using those other criteria, but they found the largest value premium by using P/B alone. Which in the early 90s, makes sense. Asset-heavy industrial companies dominated throughout most of their sample period...
by jdilla1107
Wed Oct 02, 2019 11:28 am
Forum: Investing - Theory, News & General
Topic: Small Cap Value is now just anti-technology
Replies: 30
Views: 2994

Re: Small Cap Value is now just anti-technology

There is an ongoing debate over whether price/book is a good value metric: https://www.bogleheads.org/forum/viewtopic.php?t=68291 and https://www.bogleheads.org/forum/viewtopic.php?t=68291. However, many of the most popular small-cap value funds do not rely solely on price/book to measure value. Fo...
by jdilla1107
Tue Oct 01, 2019 10:32 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value is now just anti-technology
Replies: 30
Views: 2994

Small Cap Value is now just anti-technology

The following is a mildly researched hypothesis that I have: - The idea of using book value to determine value is outdated. It came from a time when the economy was heavily based on capital intensive business. (eg: manufacturing) - Tech (especially software companies) generally have poor book values...
by jdilla1107
Tue Oct 01, 2019 8:41 pm
Forum: Investing - Theory, News & General
Topic: When Value Is More Valuable
Replies: 76
Views: 6240

Re: When Value Is More Valuable

The market portfolio is the most diversified by definition. This is a common misperception, but it is categorically false: the market portfolio is amply diversified across sources of idiosyncratic risk but is the most UNdiversified portfolio across sources of systematic risk. Indeed, it is explicit...
by jdilla1107
Mon Sep 30, 2019 2:25 pm
Forum: Personal Finance (Not Investing)
Topic: Selling Business - How much to expect, what is the process
Replies: 59
Views: 4561

Re: Selling Business - How much to expect, what is the process

Thanks, I am familiar with this and Flippa. I wanted to sell more organically as these have only 2-3x revenue valuation for companies and seem mostly b2c ones rather than b2b ones. Take a look at this site: https://www.bizbuysell.com/ Maybe you need to post more details. But, I would be surprised w...
by jdilla1107
Fri Sep 27, 2019 3:03 pm
Forum: Investing - Theory, News & General
Topic: Index Funds are bad because in tough times traders sell a lot?
Replies: 30
Views: 2838

Re: Index Funds are bad because in tough times traders sell a lot?

Doesn't make sense.

When index funds get sold, the underlying stocks get sold. An index fund is just a wrapper around individual stocks.
by jdilla1107
Sat Sep 21, 2019 9:15 pm
Forum: Personal Finance (Not Investing)
Topic: What are the rules around signing up for a business credit card?
Replies: 35
Views: 3025

Re: What are the rules around signing up for a business credit card?

It violates the terms of service to put personal expenses on a business credit card. So, technically they could sue you. I doubt it's ever happened.
by jdilla1107
Thu Sep 19, 2019 9:49 am
Forum: Investing - Theory, News & General
Topic: Is the 60/40 portfolio allocation strategy being killed?
Replies: 142
Views: 17425

Re: Is the 60/40 portfolio allocation strategy being killed?

I am 70/30 which allows me to ignore all of the debates and articles about 60/40. :twisted:
by jdilla1107
Wed Sep 11, 2019 8:55 pm
Forum: Investing - Theory, News & General
Topic: How and where to invest for a 92-year-old?
Replies: 20
Views: 1734

Re: How and where to invest for a 92-year-old?

A single payment immediate annuity (SPIA) looks like it would pay around $7,000 a month on $400k for a 90 year old male. He’s 92 and I don’t think any company will write such an annuity. Gill I used the google. This page lists 95 as the max age: https://www.fidelity.com/annuities/immediate-fixed-in...
by jdilla1107
Wed Sep 11, 2019 8:42 pm
Forum: Investing - Theory, News & General
Topic: How and where to invest for a 92-year-old?
Replies: 20
Views: 1734

Re: How and where to invest for a 92-year-old?

A single payment immediate annuity (SPIA) looks like it would pay around $7,000 a month on $400k for a 90 year old male.
by jdilla1107
Wed Sep 11, 2019 7:21 pm
Forum: Investing - Theory, News & General
Topic: How to compare Bond fund vs CD?
Replies: 7
Views: 1365

Re: How to compare Bond fund vs CD?

The SEC yield is actually 2.02% on BIV. You want to compare with the SEC yield, not the distribution yield. The SEC yield can be seen here: https://investor.vanguard.com/etf/profile/BIV So, the CD rate is better than you are thinking. The CD could under perform BIV in the future for the following re...
by jdilla1107
Tue Sep 10, 2019 10:31 pm
Forum: Investing - Theory, News & General
Topic: Explaining the Demise of Value Investing
Replies: 318
Views: 20257

Re: Explaining the Demise of Value Investing

. And even here I cited simple explanations, that they have much higher SD of earnings, tend to have more irreversible capital (cannot cut expenses in recessions), and more leverage, and fewer sources of capital and first to get cut off in flights to quality, and of course more volatile over time a...
by jdilla1107
Tue Sep 10, 2019 6:35 pm
Forum: Investing - Theory, News & General
Topic: Explaining the Demise of Value Investing
Replies: 318
Views: 20257

Re: Explaining the Demise of Value Investing

The limitations of backtesting have been discussed in detail on this forum. We all know about cognitive bias, data mining, and the like but just want to point out that nearly every investing argument refers to market history. We also make reasonable assumptions from history and project them into th...
by jdilla1107
Mon Sep 09, 2019 7:54 pm
Forum: Investing - Theory, News & General
Topic: My trend following strategy and experience
Replies: 1524
Views: 124699

Re: My trend following strategy and experience

I wonder if the "cultural memory" of Dotcom & GFC will mean we'll have to wait a long time for trend following profits. We certainly might. Almost any trend following system would have lagged buy-and-hold significantly from about 1981-1999. From 1990-1999, a 10 month moving average strategy, using ...
by jdilla1107
Mon Sep 09, 2019 6:01 pm
Forum: Investing - Theory, News & General
Topic: 5% Withdrawal Rate Recommended by US News Columnist
Replies: 141
Views: 12682

Re: 5% Withdrawal Rate Recommended by US News Columnist

The way the article is written, he is talking about a 5% withdrawal of each year’s portfolio value. Not an inflation-adjusted 5% of the initial value. The problem with this interpretation is that the article starts with: Established in 1994 by financial advisor William Bengen, the rule stipulates t...
by jdilla1107
Sun Sep 08, 2019 2:26 pm
Forum: Investing - Theory, News & General
Topic: Wade Pfau: Does The 4% Rule Work In Today’s Markets?
Replies: 149
Views: 12742

Re: Wade Pfau: Does The 4% Rule Work In Today’s Markets?

I always like to compare these claims vs. the cost of a CPI-adjusted annuity as well as an annuity that adjusts at 3%/yr. (which is cheaper than the CPI option and are available from higher-quality insurers) Inflation adjusted: 65 year old couple: 3.34% 65 year old male: 4.20% 3% COLA 65 year old c...
by jdilla1107
Sun Sep 08, 2019 8:10 am
Forum: Personal Finance (Not Investing)
Topic: Actually considering Roth 401k
Replies: 22
Views: 2110

Re: Actually considering Roth 401k

Several people seem to be thinking that $17.6% will be your marginal rate. I don't think so, but maybe you can clarify that. You probably say that because there's no 17.6% bracket, but given that the OP is discussing a solo 401(k) there actually is a 17.6% bracket for those in the 22% bracket for w...
by jdilla1107
Sat Sep 07, 2019 1:10 pm
Forum: Personal Finance (Not Investing)
Topic: Actually considering Roth 401k
Replies: 22
Views: 2110

Re: Actually considering Roth 401k

What is your projected retirement marginal tax bracket? Will you have the ability to do Roth conversions in the future in the 12/15% brackets? I think in retirement I will be near the border of today's 12/22% line. I also already have $400k of tax deferred that I will need to convert/spend. Althoug...
by jdilla1107
Sat Sep 07, 2019 12:39 pm
Forum: Personal Finance (Not Investing)
Topic: Actually considering Roth 401k
Replies: 22
Views: 2110

Actually considering Roth 401k

I have been in high tax brackets for a long time. A traditional 401k always made the most sense to me. This year I will be in a much lower tax bracket and I have a Solo 401k. I have always been someone who would recommend that most people make a deductible contribution. However, after running tax so...
by jdilla1107
Fri Sep 06, 2019 6:57 pm
Forum: Investing - Theory, News & General
Topic: Explaining the Demise of Value Investing
Replies: 318
Views: 20257

Re: Explaining the Demise of Value Investing

Jags4186 wrote: Fri Sep 06, 2019 5:54 pm Where’s the article on the demise of international investing?
Does anyone claim that international equities expose a premium which can lead to sustained long term outperformance?
by jdilla1107
Thu Sep 05, 2019 3:15 pm
Forum: Investing - Theory, News & General
Topic: Where to put excess College savings once 529 Goals are met.
Replies: 17
Views: 1600

Re: Where to put excess College savings once 529 Goals are met.

Consider still putting it in a 529. The penalty for non-qualified withdrawals is only 10% of earnings . Since you are so close to college, just stick it in a 529 bond fund and you will pay a small amount in penalty in 5 years, if you don't use it. You could even come out ahead if your marginal tax r...
by jdilla1107
Thu Sep 05, 2019 12:31 pm
Forum: Investing - Theory, News & General
Topic: In an (imaginary!) 5X leveraged ETF what would happen if the base index fell more than 20% in a single day?
Replies: 26
Views: 3106

Re: In an (imaginary!) 5X leveraged ETF what would happen if the base index fell more than 20% in a single day?

Note that equity exchanges have circuit breakers now that would not allow a drop larger than 20% in one day. Here are the different circuit breakers. https://personal.vanguard.com/us/content/Funds/FundsToolsCircuitBreakersJSP.jsp So, you would just lose all your equity at the end of the day. Whoever...
by jdilla1107
Thu Sep 05, 2019 12:01 pm
Forum: Investing - Theory, News & General
Topic: Index Funds Bubble? [Michael Burry article]
Replies: 254
Views: 34083

Re: Everyone here has misunderstood the Michael Burry article

But I don't think anyone is claiming there's a dangerous bubble in inverse and leveraged ETFs that's going to bring down the financial system. I'm guessing the Proshares 2X S&P ETF, SSO might be one of the bigger ones, total assets $2.2 billion. UBT, the 2X Treasury ETF, which might have been menti...
by jdilla1107
Thu Sep 05, 2019 11:51 am
Forum: Investing - Theory, News & General
Topic: Index Funds Bubble? [Michael Burry article]
Replies: 254
Views: 34083

Re: Everyone here has misunderstood the Michael Burry article

What do index futures have to do with passive investing though? The indexes existed long before index funds did. And index futures can exist even if index funds didn’t exist. Exactly. What did CDOs have to do with passive investing? Nothing. They were only responsible for one the most massive liqui...
by jdilla1107
Thu Sep 05, 2019 11:33 am
Forum: Investing - Theory, News & General
Topic: Index Funds Bubble? [Michael Burry article]
Replies: 254
Views: 34083

Re: Everyone here has misunderstood the Michael Burry article

If I intentionally choose a ridiculously narrow ETF from a non-Vanguard company, ESPO, the VanEck Vectors Video Gaming and eSports ETF, I see this. (These are dollars, not thousands!) Here is an image pulled from the Direxion Prospectus with is a large provider of leveraged ETFs: https://i.imgur.co...
by jdilla1107
Thu Sep 05, 2019 9:48 am
Forum: Investing - Theory, News & General
Topic: Index Funds Bubble? [Michael Burry article]
Replies: 254
Views: 34083

Re: Everyone here has misunderstood the Michael Burry article

With the CME, I think it's a zero sum game and everybody playing knows that. I might be wrong about that, though. But, the zero sum game only works if the losers are willing and able to keep paying the winners. If you jolt the system hard enough and the losers go out of business, you are in liquidi...
by jdilla1107
Thu Sep 05, 2019 9:20 am
Forum: Investing - Theory, News & General
Topic: Index Funds Bubble? [Michael Burry article]
Replies: 254
Views: 34083

Everyone here has misunderstood the Michael Burry article

[Merged here -- moderator oldcomputerguy] There is a long thread here: https://www.bogleheads.org/forum/viewtopic.php?f=10&t=289284 about Michael Burry's statements with regards to an index fund bubble and comparing index funds to CDOs. I think almost everyone here has entirely missed his point. I ...
by jdilla1107
Thu Sep 05, 2019 7:55 am
Forum: Investing - Theory, News & General
Topic: Conceptual Q - Bonds vs Bond Funds
Replies: 19
Views: 1107

Re: Conceptual Q - Bonds vs Bond Funds

Individual bonds fluctuate in price on a daily basis too. You could choose to not look at those price fluctuations and just tell yourself that you are earning a constant yield for the length of the bond. But, you could also do this with a bond fund. Just don't look at the price. I think this is whe...
by jdilla1107
Wed Sep 04, 2019 8:09 pm
Forum: Investing - Theory, News & General
Topic: Conceptual Q - Bonds vs Bond Funds
Replies: 19
Views: 1107

Re: Conceptual Q - Bonds vs Bond Funds

Individual bonds fluctuate in price on a daily basis too. You could choose to not look at those price fluctuations and just tell yourself that you are earning a constant yield for the length of the bond. But, you could also do this with a bond fund. Just don't look at the price. Another thought expe...
by jdilla1107
Fri Aug 30, 2019 12:01 pm
Forum: Investing - Theory, News & General
Topic: Rebalancing with EE Bonds
Replies: 24
Views: 1816

Re: Rebalancing with EE Bonds

I don't pretend to be an expert on this. But you can get 3% from several institutions with only a 5 year commitment and relatively small EWPs, and just a little less than that with a 2 year commitment. Even my Fidelity money market account, which I use as a bank account with ATM access, gets better...
by jdilla1107
Thu Aug 29, 2019 10:57 pm
Forum: Investing - Theory, News & General
Topic: [Larry Swedroe: Small Value Stocks are Cheap, Factor Investing Works]
Replies: 673
Views: 30589

Re: Larry Swedroe: Factor Investing Works (Despite What Some May Say)

willthrill81 wrote: Thu Aug 29, 2019 10:51 pm By spreading risk across the equity, small, and value premia, it has helped to diversify the risk in one's portfolio.
The risk of what?
by jdilla1107
Thu Aug 29, 2019 10:42 pm
Forum: Investing - Theory, News & General
Topic: Rebalancing with EE Bonds
Replies: 24
Views: 1816

Re: Rebalancing with EE Bonds

This is what I do. The warning on EE bonds rebalancing is more about making sure they don't become too much of a percentage of your bond allocation. If EE bonds were 100% of your bond allocation, you could have a liquidity issue.
by jdilla1107
Thu Aug 29, 2019 10:10 pm
Forum: Investing - Theory, News & General
Topic: [Larry Swedroe: Small Value Stocks are Cheap, Factor Investing Works]
Replies: 673
Views: 30589

Re: Larry Swedroe: Factor Investing Works (Despite What Some May Say)

But why should holding all the revenue streams in an economy necessarily help an investor achieve his or her goals? Because it most closely aligns your personal success with the success of the overall economy. It's comforting in times of stress to know that you have not made a bet. What goal does a...
by jdilla1107
Thu Aug 29, 2019 7:54 pm
Forum: Investing - Theory, News & General
Topic: [Larry Swedroe: Small Value Stocks are Cheap, Factor Investing Works]
Replies: 673
Views: 30589

Re: Larry Swedroe: Factor Investing Works (Despite What Some May Say)

If yes, how can SCV use market beta factor, since it is only a portion of the TSM? I can understand it using small and value just confused with market beta. Imagine you run a store in a town that usually has great weather and you carry only cold drinks and ice cream. When the weather is warm and su...
by jdilla1107
Thu Aug 29, 2019 6:10 pm
Forum: Investing - Theory, News & General
Topic: Series EE savings bonds attractive now?
Replies: 13
Views: 1667

Re: Series EE savings bonds attractive now?

On the other hand, if I am forced to not cash out for 20 years, wouldn't stocks be the better investment? Almost surely stocks will return more than 3.5% nominal over 20 years, no? I would love to see analysis for the percent chance stocks will return lower than this over a 20 year period. Comparin...
by jdilla1107
Thu Aug 29, 2019 6:06 pm
Forum: Investing - Theory, News & General
Topic: Series EE savings bonds attractive now?
Replies: 13
Views: 1667

Re: Series EE savings bonds attractive now?

I have been maxing my EE bonds for the last 10 years. They are a fantastic deal. They are an even more fantastic deal right now that they have been in the recent past. But, you have to hold them for exactly 20 years. - They have a free put option if interest rates go up. (You can always redeem for y...
by jdilla1107
Thu Aug 29, 2019 6:01 pm
Forum: Investing - Theory, News & General
Topic: Series EE savings bonds attractive now?
Replies: 13
Views: 1667

Re: Series EE savings bonds attractive now?

I am torn between buying: 1. EE bonds that pay 3.5% but are illiquid for 20 years, or 2. Putting that money in my 401k stable value fund paying a guaranteed 3% For just .5% difference I would go with the stable value fund, no question. No way the EE bond premium of .5% is enough compensation for th...
by jdilla1107
Wed Aug 28, 2019 3:42 pm
Forum: Investing - Theory, News & General
Topic: QE practical consequence?
Replies: 10
Views: 1392

Re: Practical difference: negative interest vs inflation?

If QE erodes the value of cash, than (as demonstrated) money goes in to all sorts of (not-liquid) assets. I can't imagine this going on forever :? QE only erodes the value of cash if it causes inflation. Consider that without QE, inflation might be -10% and QE could cause inflation to end up being ...
by jdilla1107
Wed Aug 28, 2019 3:35 pm
Forum: Investing - Theory, News & General
Topic: QE practical consequence?
Replies: 10
Views: 1392

Re: Practical difference: negative interest vs inflation?

There's been a lot of misunderstanding of QE. There is no money printing. Correctly understood, QE is the Federal Reserve implementing a change in the composition of private sector assets, effectively reducing the duration of liabilities (swapping short-term Treasuries with the overnight reserve de...
by jdilla1107
Fri Aug 23, 2019 8:50 am
Forum: Investing - Theory, News & General
Topic: Investing in Multiple Streams of Income? (NOT get rich quick)
Replies: 129
Views: 13691

Re: Investing in Multiple Streams of Income? (NOT get rich quick)

One of the key ingredients to wealth building which I see pop up, again and again, is having multiple sources of income. FWIW, this is a complete myth. No one ever provides anything remotely close to actual evidence. Just a lot of talk. Go look at the list of the Top 100 richest people in the world...
by jdilla1107
Thu Aug 22, 2019 10:43 pm
Forum: Investing - Theory, News & General
Topic: Investing in Multiple Streams of Income? (NOT get rich quick)
Replies: 129
Views: 13691

Re: Investing in Multiple Streams of Income? (NOT get rich quick)

One of the key ingredients to wealth building which I see pop up, again and again, is having multiple sources of income. FWIW, this is a complete myth. No one ever provides anything remotely close to actual evidence. Just a lot of talk. Go look at the list of the Top 100 richest people in the world...
by jdilla1107
Fri Aug 16, 2019 2:34 pm
Forum: Investing - Theory, News & General
Topic: [Larry Swedroe: Small Value Stocks are Cheap, Factor Investing Works]
Replies: 673
Views: 30589

Re: Larry Swedroe: Small Value Stocks are Cheap

But even for a buy-and-hold investor, I don't find TSM to be a compelling default choice. I don't see it as inherently more likely to provide higher absolute returns or even risk-adjusted returns than other asset classes/conceptualizations. Yes, TSM holds more stocks, but the 858 stocks held in Van...
by jdilla1107
Wed Aug 14, 2019 5:46 pm
Forum: Investing - Theory, News & General
Topic: Switch AA 10-year to 2-year Treasuries?
Replies: 61
Views: 4877

Re: Switch AA 10-year to 2-year Treasuries?

Going shorter duration because of the yield curve is completely silly. You could make an equally viable argument that you should go longer duration. (The yield curve is "telling you" that short term rates are going to drop.) The correct answer is to not pay any attention to it and make no moves bas...
by jdilla1107
Wed Aug 14, 2019 3:31 pm
Forum: Investing - Theory, News & General
Topic: Should long-term investors ignore interim bond fund value changes when calculating asset allocations?
Replies: 10
Views: 938

Re: Should long-term investors ignore interim bond fund value changes when calculating asset allocations?

I don't think bonds going up quickly is any different than stocks going up quickly. Stocks produce only so much earnings in a year. Some times people are willing to pay more or less for these earnings based on future beliefs. This is just like bonds. To say that it "understates risk" is to assume th...
by jdilla1107
Wed Aug 14, 2019 3:04 pm
Forum: Investing - Theory, News & General
Topic: Switch AA 10-year to 2-year Treasuries?
Replies: 61
Views: 4877

Re: Switch AA 10-year to 2-year Treasuries?

Going shorter duration because of the yield curve is completely silly. You could make an equally viable argument that you should go longer duration. (The yield curve is "telling you" that short term rates are going to drop.) The correct answer is to not pay any attention to it and make no moves base...