Search found 225 matches

by cato
Mon Mar 24, 2008 6:47 pm
Forum: Personal Investments
Topic: Help with MLP and taxes
Replies: 19
Views: 10071

MarketRiders wrote:Buy and hold MLPs in your IRA. I think that avoids all the hassle. I've got them in my Roth IRA.
Be careful. If you exceed the allowable amount of UBTI in an IRA (I think it's $1000 per MLP), you will have to file a special form and pay taxes on it. The amount of UBTI varies widely among MLPs.
by cato
Mon Mar 24, 2008 6:40 pm
Forum: Investing - Theory, News & General
Topic: Profunds leveraged ETFs
Replies: 20
Views: 5242

Just out of curiosity did your calculations include dividends? Yup. I used ( official? ) "total return" numbers - those should include both (reinvested) dividends and NAV growth. If I recall correctly, I got the numbers from Vanguard's "historical returns" listing -- here . Than...
by cato
Sun Mar 23, 2008 8:20 am
Forum: Personal Investments
Topic: Help with MLP and taxes
Replies: 19
Views: 10071

Incidentally, I'm sorry to hear you sold at a loss. This is the darkest hour for MLPs, especially upstream and midstream ones. Hedge funds were holding these at huge leverage levels to take advantage of the spread. They've been forced to unwind their positions all at once. I'm generally a believer i...
by cato
Sun Mar 23, 2008 8:10 am
Forum: Personal Investments
Topic: Where to park $ for home purchase in 1-3 yrs.
Replies: 17
Views: 3716

Housing futures for the region in which you plan to live. Theoretically this makes sense. In practice it's a really bad idea. There's virtually no liquidity in that market right now. Moreover, the variation within an area represented by any one contract is way too big. For example, within the SF re...
by cato
Fri Mar 21, 2008 4:26 pm
Forum: Personal Investments
Topic: Help with MLP and taxes
Replies: 19
Views: 10071

I have long argued that adding carefully chosen MLPs to your portfolio can get you outsize returns. However, TAANSTAAFL. They have to provide a much higher return to compensate you for the degree of tax complexity they add. For year-to-year reporting, it's OK to use Turbotax. However, when you sell,...
by cato
Sun Mar 02, 2008 12:42 am
Forum: Investing - Theory, News & General
Topic: There Will Be Blood
Replies: 58
Views: 12286

Reading this thread, I'm pretty sure there's money to be made shorting Comcast. :twisted:

The 60% or so of my portfolio that I hadn't Bogle-ized yet have done so well recently compared to all the indexes, I'm starting to wonder.... I'm thinking of leaving it that way.


-cato
by cato
Sun Mar 02, 2008 12:29 am
Forum: Investing - Theory, News & General
Topic: For those interested Radio Interview with Bob Brinker
Replies: 48
Views: 14077

Thanks Paul for posting that. I was sorry to have missed the radio show. I'll pipe in on Brinker's behalf. The plugs for his newsletter are pretty much separate paid ads. He doesn't mix them into his show. He also seems to market time without market-timing. I think there was only one time when he wa...
by cato
Wed Feb 27, 2008 9:25 pm
Forum: Investing - Theory, News & General
Topic: What is a resistance level?
Replies: 17
Views: 3917

Re: What is a resistance level?

Sometimes I see the term "resistance level" in regard to the S&P 500, for example, a resistance level of 1407. I understand what a resistance level is, but on what basis is a resistance level called? What's the math behind the concept? The term "resistance level" is an intro...
by cato
Wed Feb 27, 2008 9:13 pm
Forum: Personal Investments
Topic: ETF Tax Loss Harvesting
Replies: 3
Views: 1366

livesoft wrote:. . .
3. VEA:VEU is a pair.
. . .
I don't think so. VEU includes developing markets. VEA does not.

The OP suggested VEA and EFA. That would get you in to trouble since they track the same index and could be considered substantially identical.

A better pairing would be VEU and CWI


-cato
by cato
Sat Feb 23, 2008 12:43 am
Forum: Personal Investments
Topic: Stagflation - what to do?
Replies: 26
Views: 9091

If you think inflation is going to pick up, you should be selling nominal US Treasury bonds. I am. When TLT heads above 93 or so -- actually I buy Puts on it. I also try to time this just ahead of CPI and Wholesale price numbers releases. Just with my "play money" of course. (My "pla...
by cato
Tue Feb 19, 2008 11:56 pm
Forum: Investing - Theory, News & General
Topic: MSNBC:More people are tapping their 401(k) for cash
Replies: 10
Views: 2290

All my life, I took my cue from the diamond sellers, I never bought a car that cost more than a month's salary. That started with the dilapidated $1100 Datsun I bought out of college. Sadly, I will probably end up paying for this guy's BMW. When the kids go to college, his kids will get Pell grants ...
by cato
Mon Feb 18, 2008 10:09 pm
Forum: Personal Investments
Topic: Gloom, doom, and economic interconnectedness
Replies: 4
Views: 1471

. . . Secondly, government statistics are b.s. Only the analysts on CNBC believe any of that means anything. No one makes money by following that data. And do you really think we couldn't go and find any bad data from those countries to counter what you've shown? No, I don't think you can. Let's se...
by cato
Mon Feb 18, 2008 5:54 pm
Forum: Personal Investments
Topic: Gloom, doom, and economic interconnectedness
Replies: 4
Views: 1471

Gloom, doom, and economic interconnectedness

There's been a proliferation of threads here about "defensive" positioning and market-timing against impending economic calamity. If you really believe in market-timing, I'd like to provide a little perspective on the current conditions, courtesy of the Economist's "Economic and Finan...
by cato
Mon Feb 18, 2008 3:45 pm
Forum: Personal Investments
Topic: Defensive ETFs/index funds for recession
Replies: 7
Views: 2232

Re: Defensive ETFs/index funds for recession

. . . But I wouldn't take my market timing advice, I am officially the world's worst market timer, no matter what anyone else claims. Well I'm a d**n good market timer (or to say the same thing: I'm just d**n lucky). It's funny to see the proliferation of "defensive investing" cover stori...
by cato
Sat Feb 16, 2008 9:38 pm
Forum: Personal Investments
Topic: Please comment on this ETF portfolio ...
Replies: 38
Views: 9272

. . . So if you like the quoted portfolio, you'll pay lower expenses and have better execution with: 50% VTI 15% VEA 15% VWO 10% BND 10% TIP Or, of course, you could combine VEA+VWO into 30% VEU. Or skip the whole ETF thing and just buy mutual funds directly from Vanguard. Hang on a minit! This wou...
by cato
Sat Feb 16, 2008 9:16 pm
Forum: Personal Investments
Topic: How to test a possible investing algorithm?
Replies: 5
Views: 1478

If you're a Fidelity customer, you can get Wealth-Lab Pro: http://personal.fidelity.com/products/trading/Trading_Platforms_Tools/Wealth_Lab_Pro_Overview-Tools.shtml.cvsr?refpr=brk23 You can back-test any strategy imaginable. There are also literally hundreds of pre-made programs that others have dev...
by cato
Sat Feb 16, 2008 2:41 pm
Forum: Personal Investments
Topic: Please comment on this ETF portfolio ...
Replies: 38
Views: 9272

I think the Boglehead style comments made above are on target. But I'll add my own style-pickin, market-timer comments for what it's worth. If you actually believe in market-timing and style-pickin' (and I'm not sure I even do), consider this is coming from someone who has beaten every major index (...
by cato
Fri Feb 15, 2008 5:08 pm
Forum: Investing - Theory, News & General
Topic: Mr. Bogle, I know who can predict market. Where to call you?
Replies: 27
Views: 4835

Re: Mr. Bogle, I know who can predict market. Where to call

Friend: The company I am talking about is about to receive atleast 10 new clients. Once they get those projects, its stock will go up. It's easy to make money when you have inside information. Maybe not. There was some suspicion in a company I worked for that there was insider trading going on beca...
by cato
Fri Feb 15, 2008 1:40 am
Forum: Investing - Theory, News & General
Topic: The Rent-Price Ratio
Replies: 3
Views: 1426

I'm paying 2.6, which would be off the bottom of the chart. This is pretty typical for my area (Portola Vally - Silicon Valley). I can't imagine buying at this point. My costs would double or triple.

-cato
by cato
Wed Feb 13, 2008 7:36 pm
Forum: Investing - Theory, News & General
Topic: Bush tax cuts (actual details??)
Replies: 4
Views: 1592

Re: Bush tax cuts (actual details??)

. . . Qualified dividends are no longer taxed. . . That depends on the individual's tax bracket. If your income tax rate is less than 25% you pay 5% for qualified dividends. If your income tax rate is higher than 25%, you pay 15% for qualified dividends. [political comments removed by me! I beat me...
by cato
Tue Feb 12, 2008 11:13 pm
Forum: Investing - Theory, News & General
Topic: Market timing thread: what looks attractive today?
Replies: 37
Views: 7015

I was thinking more on the lines of taking something like $500K and spreading it out along the normal asset allocation. If you have a long enough time horizon(20yrs+), then with an equity biases AA (maybe 80/20), it should be very likely that you would beat the 4.25% rate(or even if it went up to 6...
by cato
Tue Feb 12, 2008 3:17 pm
Forum: Investing - Theory, News & General
Topic: Market timing thread: what looks attractive today?
Replies: 37
Views: 7015

Regarding the Fidelity Margin Rate: So, if you open up an account with Fidelity, will they margin positions that are not in "Fidelity Branded" mutual funds. So, if you use the Fidelity account to buy ETFs and other mutual funds...what is the margin ratio, $1M in assets, gets you how much ...
by cato
Tue Feb 12, 2008 1:33 pm
Forum: Investing - Theory, News & General
Topic: Market timing thread: what looks attractive today?
Replies: 37
Views: 7015

Just FYI, and I posted this in its own thread, but not surprisingly no one is really interested. The last Fed rate cut of 0.5% fully two weeks ago was not, and has not still, been passed on to Fidelity margin customers in the form of a lowering of the base margin rate. Your rate of 4.25% should be ...
by cato
Tue Feb 12, 2008 1:22 pm
Forum: Investing - Theory, News & General
Topic: Questions on Alternative Energy Funds
Replies: 5
Views: 1444

What? So you can jump on a bandwagon that's already fully loaded? This reminds of all the people in 2000, saying "I'm pretty optimistic about the Internet" and snapping up shares of JDSU at about 200X the current price. Or the Vegas house-flippers..... I generally believe in EMH, but I als...
by cato
Tue Feb 12, 2008 1:02 pm
Forum: Investing - Theory, News & General
Topic: Market timing thread: what looks attractive today?
Replies: 37
Views: 7015

Except maybe that I can borrow money from Fido at 4.25% and buy some stocks that yield a lot more than that.-cato What is fido? Borrowing at 4.25% seems interesting, especially if you have an ultra long time horizon. That's Fidelity, the broker. You do have to borrow $500k or more. However, I have ...
by cato
Tue Feb 12, 2008 12:45 pm
Forum: Personal Investments
Topic: Good rule of thumb as to what % of loss to take before sale?
Replies: 55
Views: 11422

Traders and short term investors (I use to be one) most always use a stop-loss method of some type. Some use a simple plan such as 8%, 10%, or something higher. 10% is a popular number which I why I used 12% to lessen the chance of a whipsaw. Others use trendlines, moving averages, and other techni...
by cato
Mon Feb 11, 2008 1:54 pm
Forum: Investing - Theory, News & General
Topic: Market timing thread: what looks attractive today?
Replies: 37
Views: 7015

If I were a betting man.......Some narrow categories I would consider are: * MLPs -- TPP, BPL, EEP. These offer good tax-deferred yields, which could be good haven if the 15% qualified dividend tax treatment is changed. If you own index funds, this is an asset class you might want to add, since they...
by cato
Sat Feb 09, 2008 2:45 pm
Forum: Personal Investments
Topic: fundmanager software ?'s
Replies: 9
Views: 2426

I had Fund Manager retrieve all their prices and dividends since then. I understand how you would retrieve all the prices, but how did you retrieve the dividends? I always have to enter the dividends manually. I can't just enter distributions per share, I have to enter shares reinvested, price, and...
by cato
Sat Feb 09, 2008 12:17 pm
Forum: Personal Investments
Topic: Are you Staying the Course?
Replies: 38
Views: 9283

No, I haven't stayed the course, I succumbed to market timing weakness and have been buying. I don't see that as one of your options though.


-cato
by cato
Sat Feb 09, 2008 8:53 am
Forum: Personal Investments
Topic: fundmanager software ?'s
Replies: 9
Views: 2426

So long as the fund your researching is a part of your portfolio and has a transaction history - a history you inputted via manual entry, internet price retrieval, and/or transaction history files - you can access any information on that fund from any of a multitude of reports. But you can't query ...
by cato
Fri Feb 08, 2008 10:31 pm
Forum: Personal Investments
Topic: fundmanager software ?'s
Replies: 9
Views: 2426

workingatit wrote:thanks for the replies

when you input your portfolio/individual investments does it include all the distributions when giving your return on investment?

thanks, w
Yes.
by cato
Fri Feb 08, 2008 10:23 pm
Forum: Investing - Theory, News & General
Topic: Mkt Timing, Managed Funds, and Aggressive Allocation Anyone?
Replies: 67
Views: 12173

The comment that Bogleheads maintain we can't rely on past performance to predict the future, but then turn around and say that equities will outperform bonds in the long term; and that one asset class is thusly correlated with another; and that a small-value tilt will outperform, and so on..... tha...
by cato
Wed Feb 06, 2008 10:24 am
Forum: Personal Investments
Topic: fundmanager software ?'s
Replies: 9
Views: 2426

I've tried a lot of different programs in this space and Fund Manager is vastly superior to all of them. For tracking portfolios (especially if you have multiple accounts) it's hard to beat. I don't know what you mean by "researching funds." Fund Manager can get you price and dividend hist...
by cato
Sun Feb 03, 2008 12:15 am
Forum: Personal Investments
Topic: Writing Covered Calls on High Yield Equity ETFS?
Replies: 9
Views: 2655

Unless you're talking about one of the handful of biggies -- e.g. SPY, I wouldn't even bother. I'm looking at VTI right now. The biggest Open Interest out of all the Feb. and March options is 121 contracts!! With that kind of volume, expect to lose around 10% to the bid/ask spread when you write and...
by cato
Sat Feb 02, 2008 1:36 pm
Forum: Personal Investments
Topic: I won gameshow money
Replies: 10
Views: 3318

stjoe56 wrote:A lot depends on how much you won. If it is mid to big bucks, go get professional advice. I am surprised the show did not do some withholding before it paid you.

SJ
Surprised? You think shows take responsibility for winners' taxes?


http://news.yahoo.com/s/ap/20080202/ap_ ... ivor_taxes
by cato
Fri Feb 01, 2008 1:39 pm
Forum: Personal Investments
Topic: Bailing on U.S. Markets???
Replies: 32
Views: 6790

Two very likely tax increases will be on capital gains and dividends. But holding foreign equities will not save you from these.

Also don't overlook the "only Nixon could go to China" phenomenon. [political remarks removed by Mod Mel].

-cato
by cato
Thu Jan 31, 2008 10:17 pm
Forum: Investing - Theory, News & General
Topic: Efficient Frontier Feb '08 - Fifty Years from Now
Replies: 24
Views: 3806

Thats only one factor of many. There are many factors that influence unemployment statistics. For example if one bases unemployment on the number of people that report themselfs as unemployed to authorities, it depends largely on how many incentives there are to report. Then it depends on at which ...
by cato
Thu Jan 31, 2008 7:09 pm
Forum: Investing - Theory, News & General
Topic: Efficient Frontier Feb '08 - Fifty Years from Now
Replies: 24
Views: 3806

grumel wrote:A rule of thumb is that German system overstates unemployment about 1%compared to the US system.
Where do you get that? I understand that it is the other way around, since people who lose their jobs and enroll in government-sponsored job training programs are considered to be employed.


-cato
by cato
Thu Jan 31, 2008 3:55 pm
Forum: Investing - Theory, News & General
Topic: Efficient Frontier Feb '08 - Fifty Years from Now
Replies: 24
Views: 3806

Re: Apples to apples?

Cato, . . . . snip . . . . I would be interested in knowing whether the US and European unemployment numbers cited are an apples-to-apples comparison. Robert The OECD provides standardized stats. 5.0% for the US; 7.2 for the Euro area. http://stats.oecd.org/WBOS/Default.aspx?QueryName=251&Query...
by cato
Thu Jan 31, 2008 1:50 pm
Forum: Investing - Theory, News & General
Topic: Efficient Frontier Feb '08 - Fifty Years from Now
Replies: 24
Views: 3806

Actually since 2000 European job growth has outpaced US job growth. Changes have been made to labour markets, and are continuing to be made. Economic growth in Eastern Europe has been nothing short of phenomenal (12% in Latvia/ Lithuania/ Estonia, closer to 6% in Poland/Bulgaria/ Romania). Funny, I...
by cato
Wed Jan 30, 2008 10:53 pm
Forum: Investing - Theory, News & General
Topic: Efficient Frontier Feb '08 - Fifty Years from Now
Replies: 24
Views: 3806

"Most Europeans, when they gaze upon our retirement system (and our health care system as well), laugh themselves silly." That's pretty funny because I laugh at them for laughing themselves silly. When I look at the chronic high levels of unemployment -- so high that they would cause a re...
by cato
Wed Jan 30, 2008 7:39 pm
Forum: Investing - Theory, News & General
Topic: Will a Limit order stop short borrowing and protect divis??
Replies: 9
Views: 3357

cato, As market timer suggests, I've asked Fidelity in the past to reclassify certain securities in my margin account as "cash" vs. "margin". They were happy to accomodate me. All it took was a phone call. Thanks Chip! You're right. You don't need a separate account. Apparently ...
by cato
Wed Jan 30, 2008 12:03 am
Forum: Investing - Theory, News & General
Topic: Why would anyone buy ST Treasurys now? Pays less than inflat
Replies: 26
Views: 5403

I may succumb to the temptation to use my "play money" to short or buy puts against one of the long bond funds (e.g. TLT) tomorrow. I figure if the Fed drops half a point, we'll have serious inflation in 6-8 months. If it doesn't drop rates, the bonds will probably fall in the short term. ...
by cato
Tue Jan 29, 2008 2:28 pm
Forum: Investing - Theory, News & General
Topic: Will a Limit order stop short borrowing and protect divis??
Replies: 9
Views: 3357

Re: call the broker

I'd call Fidelity and ask them about this situation. I have never had a problem in my accounts anywhere else where I held some blue chip dividend paying stocks. The qualified dividends have always matched my holding periods. If I saw a broker doing otherwise in my account, that's it for the broker....
by cato
Tue Jan 29, 2008 2:17 pm
Forum: Investing - Theory, News & General
Topic: Will a Limit order stop short borrowing and protect divis??
Replies: 9
Views: 3357

cato is this a margin account? https://us.etrade.com/e/t/estation/help?id=1502010000 Thanks, this is what I was talking about. I guess they call it a PIL (payment in lieu of dividend) when your shares are borrowed. I just found Fidelity's policy, which is similar: http://personal.fidelity.com/accou...
by cato
Tue Jan 29, 2008 1:32 pm
Forum: Investing - Theory, News & General
Topic: Will a Limit order stop short borrowing and protect divis??
Replies: 9
Views: 3357

Will a Limit order stop short borrowing and protect divis??

I have a number of ETFs, stocks, and MLPs that yield decent dividends. My understanding is that if Fidelity borrows these for a Short, the payments I receive while the shares are borrowed will be taxable interest, rather than the qualified dividends. This has serious tax implications and is particul...
by cato
Tue Jan 29, 2008 1:08 pm
Forum: Investing - Theory, News & General
Topic: Software to generate investment cross-correlation matrices?
Replies: 0
Views: 540

Software to generate investment cross-correlation matrices?

I've gotten really hooked on the nice cross-correlation matrices that G-sphere generates: http://i29.tinypic.com/wtwolc.jpg Unfortunately the trial period is about to run out. Does anyone know of a less expensive softare package that can do this? I'd rather not have to cut and paste lots of data int...
by cato
Mon Jan 28, 2008 8:58 am
Forum: Personal Investments
Topic: Vanguard 529 vs Fidelity 529...
Replies: 13
Views: 7401

I live in CA and was contemplating switching from my Nevada Vanguard 529 to the CA Fidelity plan, since I already have a Fidelity account.

I decided not to do it, since the Fidelity options were much more limited -- i.e. no way to do TIPs or value or smallcap tilting.


-cato
by cato
Sat Jan 26, 2008 2:21 pm
Forum: Investing - Theory, News & General
Topic: Having Fun with The EMH
Replies: 11
Views: 2249

As a result, the market takes on many of the characteristics of a pyramid / ponzi scheme and exhibits volatility which far exceeds any realistic interpretation of the likely net present value of future cash flows. You probably didn't read my earlier post. It sounds like you're assuming that the &qu...
by cato
Sat Jan 26, 2008 10:25 am
Forum: Investing - Theory, News & General
Topic: Having Fun with The EMH
Replies: 11
Views: 2249

Re: Having Fun with The EMH

As we have seen recently, wild swings in what must be considered intrinsic value have occurred. It makes no sense that the intrinsic value of a thing could change radically in one day, but looking at future value, then it can be rationalized. Paul This can be explained within the EMH. The market is...