Search found 4951 matches

by Lbill
Sun Apr 22, 2012 11:16 am
Forum: Investing - Theory, News & General
Topic: Any reason to hold the Vanguard Small Value Fund?
Replies: 86
Views: 7722

Re: Any reason to hold the Vanguard Small Value Fund?

I did an interesting exercise and compared the returns of VUVLX (Vanguard LCV) to a sector portfolio using SPDR sector funds with the same sector weights as currently listed for VUVLX, annually rebalanced. Over the last 11 years, returns for VUVLX were AAR= 4.58%, SD=16.1% and for the sector portfo...
by Lbill
Sun Apr 22, 2012 11:09 am
Forum: Investing - Theory, News & General
Topic: Any reason to hold the Vanguard Small Value Fund?
Replies: 86
Views: 7722

Re: Any reason to hold the Vanguard Small Value Fund?

I don't really get it. You are trying to compare the same stocks over the same time period and are surprised if their returns/SD are similar? Yeh, I was sorta. They aren't the same stocks. The SPDR sector funds use all the S&P stocks that make up each sector, and the Value fund is supposed to be us...
by Lbill
Sun Apr 22, 2012 10:52 am
Forum: Investing - Theory, News & General
Topic: Any reason to hold the Vanguard Small Value Fund?
Replies: 86
Views: 7722

Re: Any reason to hold the Vanguard Small Value Fund?

I did an interesting exercise and compared the returns of VUVLX (Vanguard LCV) to a sector portfolio using SPDR sector funds with the same sector weights as currently listed for VUVLX, annually rebalanced. Over the last 11 years, returns for VUVLX were AAR= 4.58%, SD=16.1% and for the sector portfol...
by Lbill
Sun Apr 22, 2012 10:39 am
Forum: Investing - Theory, News & General
Topic: Forget stocks - buy and hold annuities instead
Replies: 80
Views: 8643

Re: Forget stocks - buy and hold annuities instead

Death has been woefully underrated as insurance against portfolio failure. :)
by Lbill
Sat Apr 21, 2012 11:48 pm
Forum: Investing - Theory, News & General
Topic: Underrepresented Sectors: Utilities, Materials, & Telecom
Replies: 43
Views: 3329

Re: Underrepresented Sectors: Utilities, Materials, & Teleco

The SPDR sector ETFs are based on the S&P sector indexes - 9 of them (real estate is not represented). Had you held a portfolio of all 9 equally-weighted and rebalanced annually, the average annual return over the last 12 years (from inception) would have been 5.7% with average SD of 15.8%. Compara...
by Lbill
Sat Apr 21, 2012 9:54 pm
Forum: Investing - Theory, News & General
Topic: Forget stocks - buy and hold annuities instead
Replies: 80
Views: 8643

Re: Forget stocks - buy and hold annuities instead

Most states have Guarantee Associations that guarantee annuities up to $100,000 from loss due to bankruptcy of the issuer. See the list here: http://freeannuityrates.com/annuities/annuity-state-guaranty.php The limit in your state applies to each annuity contract separately, so if the total amount y...
by Lbill
Sat Apr 21, 2012 9:02 pm
Forum: Investing - Theory, News & General
Topic: Underrepresented Sectors: Utilities, Materials, & Telecom
Replies: 43
Views: 3329

Re: Underrepresented Sectors: Utilities, Materials, & Teleco

Sector Weightings do go up and down over long periods of time. What's the correct sector weightings? I don't know, and that's why I just keep the weightings in the seven sectors I own pretty well even. One thing I'm definitely not trying to do is become a closet indexer. It wouldn't make any sense....
by Lbill
Sat Apr 21, 2012 1:28 pm
Forum: Investing - Theory, News & General
Topic: Emerging Markets
Replies: 73
Views: 5667

Re: Emerging Markets

You can find lots of cool stuff in historical data. But can you know them before-hand?
Obviously not, but that applies to EM as well, correct? We all underestimate the effect of blind luck in our investment returns, dressing up in our MPT clothing and looking like we actually know something. :)
by Lbill
Sat Apr 21, 2012 12:31 pm
Forum: Investing - Theory, News & General
Topic: Emerging Markets
Replies: 73
Views: 5667

Re: Emerging Markets

It's interesting that had you held VGENX (energy) instead of VEIEX (EM) with TSM over the last 12 years, your average annual return was 2% higher with 5% lower volatility. For example an equity allocation split 50/50 between TSM and VGENX had an annual average return of 10.2% with SD of 18.3%, and 5...
by Lbill
Fri Apr 20, 2012 10:49 pm
Forum: Investing - Theory, News & General
Topic: Equal Weight Europe and Pacific Funds - an update
Replies: 54
Views: 7637

Re: Equal Weight Europe and Pacific Funds - an update

Rick - when you overweight Pacific, compared to the EAFE index, the sector weights are different. For example, basic materials are weighted more heavily. How do you know the difference between VDMIX and 50/50 isn't due to the different sector weightings from 2002-2011? The returns are not the same ...
by Lbill
Fri Apr 20, 2012 10:41 pm
Forum: Personal Consumer Issues
Topic: Hedging for survival - Doomsday Preppers
Replies: 10
Views: 1482

Hedging for survival - Doomsday Preppers

New series on National Geographic for investors who are worried that their asset allocation plan won't quite do the job and wish to diversify further: Doomsday Preppers explores the lives of otherwise ordinary Americans who are preparing for the end of the world as we know it. Unique in their belief...
by Lbill
Fri Apr 20, 2012 7:48 pm
Forum: Investing - Theory, News & General
Topic: Any reason to hold the Vanguard Small Value Fund?
Replies: 86
Views: 7722

Re: Any reason to hold the Vanguard Small Value Fund?

Pointed out in another thread by jidina80 that the Vanguard small value fund is overweight Financial Services and Real Estate (REITS) and underweight Consumer Staples, Energy, Health Care, and Tech. So, if you want to bet on financials and REITs and bet against defensive sectors and Tech, then this ...
by Lbill
Fri Apr 20, 2012 5:02 pm
Forum: Investing - Theory, News & General
Topic: Underrepresented Sectors: Utilities, Materials, & Telecom
Replies: 43
Views: 3329

Re: Underrepresented Sectors: Utilities, Materials, & Teleco

Here are some historical sector weightings in the S&P 500: http://bespokeinvest.typepad.com/bespoke/2008/04/current-and-his.html I remember back in 2006 or so, I was alarmed that financials had ballooned to over a 20% weighting, far higher than their historical weight. Part of that was real estate g...
by Lbill
Fri Apr 20, 2012 4:28 pm
Forum: Investing - Theory, News & General
Topic: Underrepresented Sectors: Utilities, Materials, & Telecom
Replies: 43
Views: 3329

Re: Underrepresented Sectors: Utilities, Materials, & Teleco

Very good thread. I was interested in sectors in the past, but had sort of forgotten some of this stuff. There's an equal sector-weight ETF named EQL. It's been around a couple of years, and it's performance so far looks like it maps perfectly the S&P 500. Be nice to see how it would have done in 20...
by Lbill
Fri Apr 20, 2012 4:14 pm
Forum: Investing - Theory, News & General
Topic: Equal Weight Europe and Pacific Funds - an update
Replies: 54
Views: 7637

Re: Equal Weight Europe and Pacific Funds - an update

What I said: individual countries can respond in dramatically different fashions to a given set of economic conditions. The wide variation in economic infrastructure, currency movements, natural resources, labor force, government regulation and geopolitical stability among different countries has re...
by Lbill
Fri Apr 20, 2012 3:51 pm
Forum: Personal Consumer Issues
Topic: Tempurpedic mattress--worth price? Finance it?
Replies: 63
Views: 16504

Re: Tempurpedic mattress--worth price? Finance it?

I'm hearing enough negative comments in this thread about the Tempurpedic that I don't think I'd want to spend the money on one. Many of them, such as the "lying in wet sand" description square with the impression I had when I tried one out in the showroom. Comments about latex and other alternative...
by Lbill
Fri Apr 20, 2012 3:45 pm
Forum: Personal Consumer Issues
Topic: Newest Honda Civic versus old Accord
Replies: 26
Views: 4218

Re: Newest Honda Civic versus old Accord

After driving the CRV I don't think I could ever go back to being low down on the road, looking up at every other vehicle, or eating my knees as I do in friend's Civic (it is an older, smaller model). I may keep that 2002 CRV forever and just buy something small and cheap to get around locally. One ...
by Lbill
Fri Apr 20, 2012 3:38 pm
Forum: Investing - Theory, News & General
Topic: Forget stocks - buy and hold annuities instead
Replies: 80
Views: 8643

Re: Forget stocks - buy and hold annuities instead

Not sure what TIPS have to do with typical annuities. Some annuities use a "step-up" feature in which early payments start lower than a standard annuity and are stepped up periodically. But most annuities are not inflation-protected. The ones that are have higher premium, which I suppose is set base...
by Lbill
Fri Apr 20, 2012 3:22 pm
Forum: Investing - Theory, News & General
Topic: Equal Weight Europe and Pacific Funds - an update
Replies: 54
Views: 7637

Re: Equal Weight Europe and Pacific Funds - an update

No doubt we agree more than disagree
I agree, Noob! :)
by Lbill
Fri Apr 20, 2012 12:23 pm
Forum: Personal Consumer Issues
Topic: Tempurpedic mattress--worth price? Finance it?
Replies: 63
Views: 16504

Re: Tempurpedic mattress--worth price? Finance it?

My memory foam topper is 2" thick and I think it does "bottom out" to some extent. However, I noticed that you can get them 4" - 5" thick as well, for more bucks. I wondered if the thicker they are, the more "realistic" the experience is? However, these get up into the $300 - $500 range in some inst...
by Lbill
Fri Apr 20, 2012 12:18 pm
Forum: Personal Consumer Issues
Topic: Looking into buying a flatscreen tv
Replies: 62
Views: 5206

Re: Looking into buying a flatscreen tv

I have an Onkyo TX-NR3008 that will do that for a variety of inputs, but it was pretty expensive.
Yeah - the shipping charge from Amazon to Hawaii alone must have broken the bank. :)
by Lbill
Fri Apr 20, 2012 12:13 pm
Forum: Investing - Theory, News & General
Topic: Forget stocks - buy and hold annuities instead
Replies: 80
Views: 8643

Re: Forget stocks - buy and hold annuities instead

Impressive. My question is whether they eat what they cook up? Do they disclose what their asset allocation and retirement plans look like because if they aren't - they are merely presenting theoretical outcomes. I see your point, sorta. But I don't know why you would have to own the same portfolio...
by Lbill
Fri Apr 20, 2012 11:53 am
Forum: Investing - Theory, News & General
Topic: Equal Weight Europe and Pacific Funds - an update
Replies: 54
Views: 7637

Re: Equal Weight Europe and Pacific Funds - an update

At this point I'm just straight up confused. The period I showed actually illustrates that over that period you'd have been *better off* with just US. If my argument were 'you will get higher returns holding ex-US too' those charts would work against me. And in fact, I never said you will get highe...
by Lbill
Fri Apr 20, 2012 11:32 am
Forum: Personal Consumer Issues
Topic: Looking into buying a flatscreen tv
Replies: 62
Views: 5206

Re: Looking into buying a flatscreen tv

I will tell you to buy a size bigger than you think you will need. I got a 46" Samsung LCD in 2010; love it and all, but wish I went with the 55". You will never wish you went for smaller TV. Never. Spot on. I'm in same situation as awval. HD enables you to have a much closer viewing distance than ...
by Lbill
Fri Apr 20, 2012 11:29 am
Forum: Personal Consumer Issues
Topic: Looking into buying a flatscreen tv
Replies: 62
Views: 5206

Re: Looking into buying a flatscreen tv

One thing I've noticed is that these things have some sort of capability to automatically recognize the input source: cable, DVD player, etc. So you don't need 15 different controllers to operate your entertainment system. There is a protocol, HDMI-CEC, for devices connected with HDMI cables to com...
by Lbill
Fri Apr 20, 2012 11:15 am
Forum: Investing - Theory, News & General
Topic: I had a meeting with David Swensen tonight!
Replies: 59
Views: 9739

Re: I had a meeting with David Swensen tonight!

Thanks for the report, very interesting.
by Lbill
Fri Apr 20, 2012 11:09 am
Forum: Investing - Theory, News & General
Topic: How to think about diversification
Replies: 124
Views: 7718

Re: How to think about diversification

Very interesting and informative thread, and thanks to all the posters. Larry the Prosecutor makes strong "pro" arguments and I've heard some pretty good "con" arguments. From the jury box, I have to say that I still have "reasonable doubt" about being able to reliably capitalize on the small and va...
by Lbill
Fri Apr 20, 2012 10:54 am
Forum: Personal Consumer Issues
Topic: Tempurpedic mattress--worth price? Finance it?
Replies: 63
Views: 16504

Re: Tempurpedic mattress--worth price? Finance it?

I got a memory foam topper for my firm Simmons and it feels like a Tempurpedic to me for about $130. I figure if I don't like it, I can toss it out or replace it for less than $4,000. As for weight, this thing is heavy enough - I can't imagine how heavy a whole mattress of this stuff would be. Anybo...
by Lbill
Fri Apr 20, 2012 10:44 am
Forum: Personal Consumer Issues
Topic: Looking into buying a flatscreen tv
Replies: 62
Views: 5206

Re: Looking into buying a flatscreen tv

Have a Samsung 42" LCD. One thing I've noticed is that these things have some sort of capability to automatically recognize the input source: cable, DVD player, etc. So you don't need 15 different controllers to operate your entertainment system. I really don't know enough about this or what to be l...
by Lbill
Fri Apr 20, 2012 10:36 am
Forum: Personal Consumer Issues
Topic: Newest Honda Civic versus old Accord
Replies: 26
Views: 4218

Re: Newest Honda Civic versus old Accord

Interesting comments about the appearance of the recent Hondas. I'm a long time Honda owner and very loyal to the brand. Own a 2002 CRV that still runs and looks like new and I love it. I agree about the looks of the Accord. I've owned them and always thought they looked sharp but not lately. I was ...
by Lbill
Fri Apr 20, 2012 10:24 am
Forum: Investing - Theory, News & General
Topic: Forget stocks - buy and hold annuities instead
Replies: 80
Views: 8643

Re: Forget stocks - buy and hold annuities instead

The tone of the top post and of several responders is such as to suggest that recommending the purchase of immediate annuities is for some reason worthy of ridicule. I'm not sure I see why. Don't get me wrong. As much as anyone else, I love heaping scorn on bad, self-serving financial advice from s...
by Lbill
Fri Apr 20, 2012 10:10 am
Forum: Investing - Theory, News & General
Topic: Equal Weight Europe and Pacific Funds - an update
Replies: 54
Views: 7637

Re: Equal Weight Europe and Pacific Funds - an update

Rick - when you overweight Pacific, compared to the EAFE index, the sector weights are different. For example, basic materials are weighted more heavily. How do you know the difference between VDMIX and 50/50 isn't due to the different sector weightings from 2002-2011?
by Lbill
Thu Apr 19, 2012 10:42 pm
Forum: Investing - Theory, News & General
Topic: Equal Weight Europe and Pacific Funds - an update
Replies: 54
Views: 7637

Re: Equal Weight Europe and Pacific Funds - an update

Noob - check the paper by Rex (linked). He points out that in local currencies, there is a trivial difference in returns between major large cap U.S. and EAFE market indexes. You gain no economic diversification benefit beyond differences in the exchange rates. If you want to bet on currencies, the...
by Lbill
Thu Apr 19, 2012 10:19 pm
Forum: Investing - Theory, News & General
Topic: Forget stocks - buy and hold annuities instead
Replies: 80
Views: 8643

Re: Forget stocks - buy and hold annuities instead

Any comment on the blow up rate of privately issued guarantees over 30-40 years?? Or comparison to the social security annuity by the biggest financial entity in the world that is failing? Or they just really say nothing, but imply that annuities by private companies are risk free ? Magic pixie dus...
by Lbill
Thu Apr 19, 2012 9:19 pm
Forum: Investing - Theory, News & General
Topic: Will TIPS really hedge inflation risk for retirees?
Replies: 13
Views: 1459

Re: Will TIPS really hedge inflation risk for retirees?

Hi Lbill, I agree that the funds probably do catch up, but that is what makes the ladder somewhat safer. There is no worry about whether you catch up or not, because there is no catching up to be done. :happy A problem with the paper though is that by using TIPS funds, changes in real interest rate...
by Lbill
Thu Apr 19, 2012 5:43 pm
Forum: Investing - Theory, News & General
Topic: Do retirees need deflation protection too?
Replies: 18
Views: 1664

Re: Do retirees need deflation protection too?

It definitely makes sense that retirees have some deflation protection in their portfolios. Though much less likely these days than an inflation shock, a deflationary shock would depress equity prices dramatically, probably for a prolonged period of time. Those retirees depending on their assets fo...
by Lbill
Thu Apr 19, 2012 5:36 pm
Forum: Investing - Theory, News & General
Topic: Forget stocks - buy and hold annuities instead
Replies: 80
Views: 8643

Re: Forget stocks - buy and hold annuities instead

Cut-Throat wrote:Jeez, Surprise, Surprise, A conference that supports Annuities slam stocks in Favor of purchasing Annuities.

This is like a Porn Star attending a Porn Convention and getting an Award for "Best Actress".
You would rather attend a Stock Porn conference? Better hors d'oeuvres probably. :)
by Lbill
Thu Apr 19, 2012 4:52 pm
Forum: Investing - Theory, News & General
Topic: Equal Weight Europe and Pacific Funds - an update
Replies: 54
Views: 7637

Re: Equal Weight Europe and Pacific Funds - an update

Noob - check the paper by Rex (linked). He points out that in local currencies, there is a trivial difference in returns between major large cap U.S. and EAFE market indexes. You gain no economic diversification benefit beyond differences in the exchange rates. If you want to bet on currencies, ther...
by Lbill
Thu Apr 19, 2012 4:42 pm
Forum: Investing - Theory, News & General
Topic: Will TIPS really hedge inflation risk for retirees?
Replies: 13
Views: 1459

Re: Will TIPS really hedge inflation risk for retirees?

Thanks Bob. Your example provides some concrete figures, but allow me to continue wearing my devil's advocate cap. As you pointed out, interest rate risk will affect the total value of your current holdings in a TIPS fund at a given point in time; and also affects the total value of your current hol...
by Lbill
Thu Apr 19, 2012 4:16 pm
Forum: Investing - Theory, News & General
Topic: Forget stocks - buy and hold annuities instead
Replies: 80
Views: 8643

Forget stocks - buy and hold annuities instead

Some gems from the Retirement Income Industry Association 2010 Conference provided in this summary by Kerry Pechter: At the Retirement Income Industry Association's spring conference, you could almost see Jeremy Siegel standing on his head. Almost... Siegel, author of "Stocks for the Long Run" made ...
by Lbill
Thu Apr 19, 2012 3:24 pm
Forum: Investing - Theory, News & General
Topic: Equal Weight Europe and Pacific Funds - an update
Replies: 54
Views: 7637

Re: Equal Weight Europe and Pacific Funds - an update

I totally disagree. Non US-stocks should be invested exclusively in small and value stocks for enhanced returns and more significant diversification. Nothing's changed in the 17 years since Rex won the Graham and Dodd award for best paper of 1995 with this piece: http://www.mikemahoneyblog.com/new/...
by Lbill
Thu Apr 19, 2012 3:02 pm
Forum: Investing - Theory, News & General
Topic: Bogle eblog malicious website blocked
Replies: 2
Views: 507

Bogle eblog malicious website blocked

Just tried to navigate to Bogle's eblog website and Norton blocked it as a malicious website. What gives???
by Lbill
Thu Apr 19, 2012 2:09 pm
Forum: Investing - Theory, News & General
Topic: Will TIPS really hedge inflation risk for retirees?
Replies: 13
Views: 1459

Re: Will TIPS really hedge inflation risk for retirees?

It seems to me that most of the paper is about using TIPS bond funds as a hedge against inflation during retirement. This is not at all the same thing as using maturing TIPS bonds as a hedge against inflation. There is a great deal of difference between spending $15,000 per year from a TIPS mutual ...
by Lbill
Thu Apr 19, 2012 9:43 am
Forum: Investing - Theory, News & General
Topic: Will TIPS really hedge inflation risk for retirees?
Replies: 13
Views: 1459

Re: Will TIPS really hedge inflation risk for retirees?

Nisiprius wrote: This paper feels to me like it's grinding an axe. They're taking something small and blowing it up as a reason to disregard TIPS. I'm not sure what the motivation would be, though. Like the equally phony chart that shows that the mostly-speculative monthly fluctuations in TIPS marke...
by Lbill
Wed Apr 18, 2012 7:32 pm
Forum: Investing - Theory, News & General
Topic: Do retirees need deflation protection too?
Replies: 18
Views: 1664

Do retirees need deflation protection too?

The conventional wisdom is that the greatest threat to retirees is the erosion of purchasing power from inflation. Deflation, on the other hand, isn't seen as severe a threat - maybe even a plus because stuff gets cheaper and your retirement dollars can buy more. But that's a simplistic view. Unfort...
by Lbill
Wed Apr 18, 2012 6:23 pm
Forum: Investing - Theory, News & General
Topic: Will TIPS really hedge inflation risk for retirees?
Replies: 13
Views: 1459

Will TIPS really hedge inflation risk for retirees?

Recent research paper analyzes the benefit for retirees of investing in TIPS bond funds as a hedge against inflation that will help to reduce the likelihood of portfolio ruin. Because the inflation measure used to adjust TIPS (CPI-U) is systematically lower than the measure of actual living cost inf...
by Lbill
Wed Apr 18, 2012 4:50 pm
Forum: Investing - Theory, News & General
Topic: How to think about diversification
Replies: 124
Views: 7718

Re: How to think about diversification

yobria wrote: I think the fundamental issue is you're assigning a mystical value to these corners of the market far in excess of their practical worth. If a large caps splits into 20 small caps (large -> small), or a company sells and leases back its factory (high book value-> low book value), it ha...
by Lbill
Tue Apr 17, 2012 10:57 pm
Forum: Investing - Theory, News & General
Topic: The Curse of the Yale Model
Replies: 36
Views: 5527

Re: The Curse of the Yale Model

So, how has the version Swensen recommended for the unwashed masses fared lately?
by Lbill
Tue Apr 17, 2012 7:28 pm
Forum: Investing - Theory, News & General
Topic: Small Cap Value - What Funds & How Much do you tilt?
Replies: 156
Views: 10070

Re: Small Cap Value - What Funds & How Much do you tilt?

But don't let me get off track here: it's not about getting better returns from EM, it's about diversifying away risks, and concentration risk is a big risk. Otherwise, if it's really just about Beta, let's all just pick whatever sector meets that need, right? Noob - I couldn't agree more. That's w...
by Lbill
Tue Apr 17, 2012 7:02 pm
Forum: Personal Consumer Issues
Topic: would you rather retire early or retire richer?
Replies: 86
Views: 7261

Re: would you rather retire early or retire richer?

No-one, on their deathbed, has been heard to say "I wish I'd spent more time in the office ." "It's better to retire too soon, than retire too late." Those two little inspirational quotes had a lot to do with my decision to take the leap of faith and retire early. Things actually have turned out muc...