Search found 539 matches

by Gufomel
Wed Apr 22, 2020 6:43 pm
Forum: Investing - Theory, News & General
Topic: First 20% of bonds in long-term Treasuries
Replies: 927
Views: 68356

Re: First 20% of bonds in long-term Treasuries

Does it still make sense to add new money to LTTs now? Yes, due to bond convexity. Tyler9000's post here on the topic is a must read for those interested in using bonds to their fullest potential. Thanks for the link. Any advice how to gain a better conceptual understanding of convexity and it’s mo...
by Gufomel
Wed Apr 22, 2020 5:52 pm
Forum: Investing - Theory, News & General
Topic: First 20% of bonds in long-term Treasuries
Replies: 927
Views: 68356

Re: First 20% of bonds in long-term Treasuries

Does it still make sense to add new money to LTTs now? Yes, due to bond convexity. Tyler9000's post here on the topic is a must read for those interested in using bonds to their fullest potential. Thanks for the link. Any advice how to gain a better conceptual understanding of convexity and it’s mo...
by Gufomel
Wed Apr 22, 2020 10:27 am
Forum: Investing - Theory, News & General
Topic: First 20% of bonds in long-term Treasuries
Replies: 927
Views: 68356

Re: First 20% of bonds in long-term Treasuries

Vineviz- thanks for your thoughts on this topic. I’ve seen a lot of discussion on various threads about how LTT are especially good for investors with high equity allocations. What about investors who are later in the accumulation stage and lowering their equity allocation? For example, let’s say a...
by Gufomel
Wed Apr 22, 2020 10:08 am
Forum: Investing - Theory, News & General
Topic: First 20% of bonds in long-term Treasuries
Replies: 927
Views: 68356

Re: First 20% of bonds in long-term Treasuries

Vineviz- thanks for your thoughts on this topic. I’ve seen a lot of discussion on various threads about how LTT are especially good for investors with high equity allocations. What about investors who are later in the accumulation stage and lowering their equity allocation? For example, let’s say a ...
by Gufomel
Tue Apr 21, 2020 3:58 pm
Forum: Investing - Theory, News & General
Topic: Are we better off now than Dec 2018?
Replies: 264
Views: 21028

Re: Are we better off now than Dec 2018?

I think people need to ask themselves why they are freaked out about a US stock market that is just about where it was in Dec 2018. Why not just take what you had back then “off the table”. THINK about this! We are looking to be in far worse shape over the next year than anything that was remotely ...
by Gufomel
Tue Apr 21, 2020 7:32 am
Forum: Investing - Theory, News & General
Topic: Are we better off now than Dec 2018?
Replies: 264
Views: 21028

Re: Are we better off now than Dec 2018?

We are looking to be in far worse shape over the next year than anything that was remotely contemplated in Dec 2018. Yet somehow people feel it is too late to sell. Stop anchoring you’re feelings around gains that you are not getting back anytime soon. That 3000 S&P is NOT Coming back anytime soon....
by Gufomel
Mon Apr 20, 2020 9:32 am
Forum: Investing - Theory, News & General
Topic: 1-month T- Bills
Replies: 12
Views: 890

Re: 1-month T- Bills

With Vanguard I’ve always been able to invest immediately after initiating a transfer from my bank. The cash doesn’t settle for a couple days, but that doesn’t prevent the money from being available for investment. Are there other issues I’m not aware of? You are initiating a pull from a cash accou...
by Gufomel
Mon Apr 20, 2020 8:56 am
Forum: Investing - Theory, News & General
Topic: 1-month T- Bills
Replies: 12
Views: 890

Re: 1-month T- Bills

Are T-bills really paying 0.12% right now? I think I must be reading something wrong. I was going to buy some, but my savings account at Ally is paying 1.5% and it looks like it isn't worth the effort to buy T-bills right now. i use short term treasury bills as a temporary holding fund instead of m...
by Gufomel
Sun Apr 19, 2020 8:35 pm
Forum: Investing - Theory, News & General
Topic: 1-month T- Bills
Replies: 12
Views: 890

Re: 1-month T- Bills

Are T-bills really paying 0.12% right now? I think I must be reading something wrong. I was going to buy some, but my savings account at Ally is paying 1.5% and it looks like it isn't worth the effort to buy T-bills right now. i use short term treasury bills as a temporary holding fund instead of m...
by Gufomel
Thu Apr 16, 2020 8:19 am
Forum: Investing - Theory, News & General
Topic: some hand-holding on ETFs
Replies: 18
Views: 794

Re: some hand-holding on ETFs

livesoft wrote: Thu Apr 16, 2020 7:59 am I would like to point out to other readers that my scenarios had nothing to do with "market trends" and no market timing was suggested at all.
Is the intention to decrease risk of one lump sum purchased at an unfavorable intra-day price, or is there other motive?
by Gufomel
Thu Apr 16, 2020 7:30 am
Forum: Investing - Theory, News & General
Topic: some hand-holding on ETFs
Replies: 18
Views: 794

Re: some hand-holding on ETFs

Unless you have reason to really believe that anything above $22.05 is a price you’re unwilling to pay, I think common advice is to place a marketable limit order. For example if the current price is $22.05, you could place a buy order with a limit price of $22.50. Since your limit price is above th...
by Gufomel
Tue Apr 14, 2020 8:41 am
Forum: Investing - Theory, News & General
Topic: U.S. stocks continue to soar!
Replies: 9369
Views: 747340

Re: U.S. stocks continue to soar!

Stocks are up up up. Maybe the US is turning into a purely Tech economy and “Tech” will end up splitting into 5 sectors or something...
by Gufomel
Fri Apr 10, 2020 11:38 am
Forum: Investing - Theory, News & General
Topic: 2020 I Bonds: what's your plan?
Replies: 55
Views: 7818

Re: 2020 I Bonds: what's your plan?

So looks like iBonds purchased before May will pay 1.74% over the next year (2.22% for first 6 months then 1.26% for next 6 months, including 0.2% fixed rate).

https://tipswatch.com/tracking-inflation-and-i-bonds/
by Gufomel
Tue Apr 07, 2020 11:48 am
Forum: Investing - Theory, News & General
Topic: Coronavirus and the market
Replies: 4020
Views: 311648

Re: Coronavirus and the market

So with the new ways of dealing with downmarket from Fed/Govt of pumping trillions of dollars into the economy every time it crashes, are the days of the market going down -50% type of planning gone? In that case, I don't think I will see > -50% down market in my lifetime then (Index funds and not ...
by Gufomel
Tue Apr 07, 2020 11:24 am
Forum: Investing - Theory, News & General
Topic: Coronavirus and the market
Replies: 4020
Views: 311648

Re: Coronavirus and the market

So with the new ways of dealing with downmarket from Fed/Govt of pumping trillions of dollars into the economy every time it crashes, are the days of the market going down -50% type of planning gone? In that case, I don't think I will see > -50% down market in my lifetime then (Index funds and not ...
by Gufomel
Tue Apr 07, 2020 6:22 am
Forum: Investing - Theory, News & General
Topic: Coronavirus and the market
Replies: 4020
Views: 311648

Re: Coronavirus and the market

Seems like a -50% possible drawdown doesn't hold true anymore with the Fed. Maybe I should be more aggressive with my AA. There's rampant hope in the markets right now. I hope that it isn't unfounded, but I'm afraid that much of it is. Curious why you think the hope is unfounded. Even though everyo...
by Gufomel
Mon Apr 06, 2020 3:24 pm
Forum: Investing - Theory, News & General
Topic: U.S. stocks continue to soar!
Replies: 9369
Views: 747340

Re: U.S. stocks continue to soar!

Futures gains have held overnight. I’m sensing some green shoots of optimism. It’s still pretty dark, but the dawn seems to be coming. Hmm.... maybe I will hold off a rebalancing transaction that I had planned to do today. I've rescheduled mine to tomorrow. With volatility so high, we can expect an...
by Gufomel
Mon Apr 06, 2020 1:29 pm
Forum: Personal Investments
Topic: Rebalancing mistakes
Replies: 44
Views: 2064

Re: Rebalancing mistakes

It sounds to me that you don’t actually want to be 65/35 if you’re now at 80/20 in the middle of a market crash and not worried.

Why did you pick 65/35?
by Gufomel
Mon Apr 06, 2020 9:00 am
Forum: Investing - Theory, News & General
Topic: Dow Futures Up Again?
Replies: 131
Views: 8302

Re: Dow Futures Up Again?

Here comes the FOMO!
by Gufomel
Mon Apr 06, 2020 6:20 am
Forum: Investing - Theory, News & General
Topic: Dow Futures Up Again?
Replies: 131
Views: 8302

Re: Dow Futures Up Again?

You don’t think the market knows all this? Logic says the market should know all this of course. But I just find the magnitude of the drop so far (20-ish percent) doesn't seem sufficiently large to account for a real-world, global, shock of this severity.... it's only retraced to levels of a couple...
by Gufomel
Fri Apr 03, 2020 8:42 am
Forum: Investing - Theory, News & General
Topic: Is the coming pain really "priced in"?
Replies: 201
Views: 19480

Re: Is the coming pain really "priced in"?

Yahoo Finance headline: “US jobs report disappoints by massive margin” Stock futures flat/slightly up. I’d say the market has pretty well priced in short-term expectations. The long-term expectations cover a very wide range of outcomes, thus the very high VIX. The market has priced in all those var...
by Gufomel
Fri Apr 03, 2020 8:18 am
Forum: Investing - Theory, News & General
Topic: Is the coming pain really "priced in"?
Replies: 201
Views: 19480

Re: Is the coming pain really "priced in"?

Yahoo Finance headline: “US jobs report disappoints by massive margin” Stock futures flat/slightly up. I’d say the market has pretty well priced in short-term expectations. The long-term expectations cover a very wide range of outcomes, thus the very high VIX. The market has priced in all those vary...
by Gufomel
Thu Apr 02, 2020 4:40 pm
Forum: Investing - Theory, News & General
Topic: Is the coming pain really "priced in"?
Replies: 201
Views: 19480

Re: Is the coming pain really "priced in"?

I find it exceptional that the S&P is where it is right now. As reference, the 2008/09 bear market bottomed at 8x peak earnings, that would take the S&P to 1100-1150. I fully expect the S&P go down to 1500, probably lower. That multiple on peak earnings is what I am looking closely at. Do you happe...
by Gufomel
Thu Apr 02, 2020 3:32 pm
Forum: Investing - Theory, News & General
Topic: Is the coming pain really "priced in"?
Replies: 201
Views: 19480

Re: Is the coming pain really "priced in"?

Frankly I think it’s kind of ridiculous to claim the market hasn’t priced the coming pain in well, when the general public opinion around beginning-to-mid March was “what’s the big deal” while the market plummeted to lows. Now the market has temporarily leveled out a bit, and people are screaming “l...
by Gufomel
Thu Apr 02, 2020 2:15 pm
Forum: Investing - Theory, News & General
Topic: Is the coming pain really "priced in"?
Replies: 201
Views: 19480

Re: Is the coming pain really "priced in"?

The market tanked as soon as the unemployment report came out. That's proof nothing is priced in. What are you talking about the market is up What are you talking about. Do you know when the report came out? Were you watching the futures? https://www.zerohedge.com/s3/files/inline-images/2020-04-02_...
by Gufomel
Thu Apr 02, 2020 2:00 pm
Forum: Investing - Theory, News & General
Topic: Is the coming pain really "priced in"?
Replies: 201
Views: 19480

Re: Is the coming pain really "priced in"?

The market tanked as soon as the unemployment report came out. That's proof nothing is priced in. What are you talking about the market is up What are you talking about. Do you know when the report came out? Were you watching the futures? https://www.zerohedge.com/s3/files/inline-images/2020-04-02_...
by Gufomel
Thu Apr 02, 2020 12:57 pm
Forum: Investing - Theory, News & General
Topic: Is the coming pain really "priced in"?
Replies: 201
Views: 19480

Re: Is the coming pain really "priced in"?

The market tanked as soon as the unemployment report came out. That's proof nothing is priced in. Futures fell from 1-2% up to even, the market opened even and now has risen to about 2% up. I’d say that’s a pretty good indication a 6 million unemployment number was priced in. It's back up due to oi...
by Gufomel
Thu Apr 02, 2020 11:04 am
Forum: Investing - Theory, News & General
Topic: Is the coming pain really "priced in"?
Replies: 201
Views: 19480

Re: Is the coming pain really "priced in"?

jpmorganfunds wrote: Thu Apr 02, 2020 10:41 am The market tanked as soon as the unemployment report came out. That's proof nothing is priced in.
Futures fell from 1-2% up to even, the market opened even and now has risen to about 2% up. I’d say that’s a pretty good indication a 6 million unemployment number was priced in.
by Gufomel
Thu Apr 02, 2020 9:47 am
Forum: Investing - Theory, News & General
Topic: Is the coming pain really "priced in"?
Replies: 201
Views: 19480

Re: Is the coming pain really "priced in"?

i think dow jones hitting 18k couple weeks ago was the bottom. this could be a local bottom yes... but only to a much bigger fall off... The numbers are trending up... +16K NEW cases in the US +490 deaths in just the last 11 hours... In another week, those numbers are likely to get very bad. I agre...
by Gufomel
Thu Apr 02, 2020 7:34 am
Forum: Investing - Theory, News & General
Topic: Is the coming pain really "priced in"?
Replies: 201
Views: 19480

Re: Is the coming pain really "priced in"?

The S&P 500 is currently at early-2019 levels. That doesn't seem that disastrous, for one of the biggest crises in U.S. history. So is the coming pain really priced in at current levels? The coming pain will be: even more massive debts than before, small businesses defaulting on loans and shutting ...
by Gufomel
Wed Apr 01, 2020 3:02 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 1074
Views: 105643

Re: Lifecycle Investing - Leveraging when young

It also finally makes sense to me why the Vanguard lifecycle funds have a significantly higher stock allocation than most typical “age in bonds” or “age minus 10 in bonds” maxims. I think you referenced this in either this thread or another one. Thanks again for your input.
by Gufomel
Wed Apr 01, 2020 2:44 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 1074
Views: 105643

Re: Lifecycle Investing - Leveraging when young

Ok that’s making sense. Thanks for bearing with me. As far as discounting the future mortgage payments, wouldn’t you want to discount it at the risk-free rate? I think you kind of alluded to it that that’s technically what you would want to do. So presumably a nominal treasury rate at a duration ar...
by Gufomel
Wed Apr 01, 2020 2:36 pm
Forum: Investing - Theory, News & General
Topic: Asset allocation strategies for accumulators
Replies: 36
Views: 2343

Re: Asset allocation strategies for accumulators

Frankly I don’t see the point in starting at 20/80 and then gliding to 80/20? Why not just go 80/20 your whole life? I have some criticisms of the methodology and ranges, but along the lines of what fourwheelcycle was talking about, I generally think that beginning conservatively and increasing sto...
by Gufomel
Wed Apr 01, 2020 2:07 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 1074
Views: 105643

Re: Lifecycle Investing - Leveraging when young

Thanks. Yes examples are very helpful. I completely agree with not counting the house equity as an asset for this calculation. Maybe if you expected to significantly downsize in house at retirement then it would make sense to include an amount that you expect to be able to cash out? Idk, that’s not...
by Gufomel
Wed Apr 01, 2020 1:52 pm
Forum: Investing - Theory, News & General
Topic: Asset allocation strategies for accumulators
Replies: 36
Views: 2343

Re: Asset allocation strategies for accumulators

I ran across the name Javier Estrada from reading this forum, since one of his papers was listed in a bucketing discussion. I've only read a couple of the papers, but one might be relevant to this discussion here. If you don't want to read the whole thing, here are the relevant portions to explain ...
by Gufomel
Wed Apr 01, 2020 12:07 pm
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 1074
Views: 105643

Re: Lifecycle Investing - Leveraging when young

Regarding the mortgage, overall that mostly makes sense. I just want to make sure I’m clear on what you’re saying. You would effectively be including the mortgage payment in your future savings calculation, correct? And when you mention 10k mortgage in your example above, you would only be counting...
by Gufomel
Wed Apr 01, 2020 11:00 am
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 1074
Views: 105643

Re: Lifecycle Investing - Leveraging when young

Thank you. As far as the lifetime wealth calculation (excuse my terminology if that’s not exactly right), would you factor in a mortgage as a negative bond if you intend to have a paid-off house by retirement? I’ve never really been able to wrap my head around the idea of counting a mortgage as a n...
by Gufomel
Wed Apr 01, 2020 8:05 am
Forum: Investing - Theory, News & General
Topic: Lifecycle Investing - Leveraging when young
Replies: 1074
Views: 105643

Re: Lifecycle Investing - Leveraging when young

I haven’t read much of this thread, so maybe this has been discussed. And I feel like this is a really dumb question, but I can’t figure it out. How are you calculating the leverage ratio in your OP (copied below)? Shouldn’t it be debt/equity, so for May 2019 it would be 92k/143k = .64 and for April...
by Gufomel
Wed Apr 01, 2020 7:04 am
Forum: Investing - Theory, News & General
Topic: Asset allocation strategies for accumulators
Replies: 36
Views: 2343

Re: Asset allocation strategies for accumulators

That's exactly what will happen. But it's a very logical thing to happen. In every other strategy, future savings contributions play no role. So if you were planning to accumulate for the next 20 years and suddenly change that to 5 years, no strategy changes your allocation. That's a little ridicul...
by Gufomel
Wed Apr 01, 2020 6:56 am
Forum: Investing - Theory, News & General
Topic: Asset allocation strategies for accumulators
Replies: 36
Views: 2343

Re: Asset allocation strategies for accumulators

How would you handle things like kids college expenses? Would you bucket that off on its own, or somehow roll it together into the same portfolio with retirement? And when you say 100% equity, I’m assuming you would still be holding fixed income off to the side for things like an emergency fund and...
by Gufomel
Tue Mar 31, 2020 9:15 pm
Forum: Investing - Theory, News & General
Topic: Asset allocation strategies for accumulators
Replies: 36
Views: 2343

Re: Asset allocation strategies for accumulators

That's exactly what will happen. But it's a very logical thing to happen. In every other strategy, future savings contributions play no role. So if you were planning to accumulate for the next 20 years and suddenly change that to 5 years, no strategy changes your allocation. That's a little ridicul...
by Gufomel
Tue Mar 31, 2020 8:10 pm
Forum: Investing - Theory, News & General
Topic: Asset allocation strategies for accumulators
Replies: 36
Views: 2343

Re: Asset allocation strategies for accumulators

It's quite an interesting concept and actually very intuitive. Indeed, I came to the same conclusion when reading your post as you said at the end regarding lump summing vs DCA'ing and getting all the stocks invested early. Essentially you're lump summing your future equities as quickly as possible...
by Gufomel
Tue Mar 31, 2020 1:21 pm
Forum: Personal Finance (Not Investing)
Topic: Save or invest?
Replies: 17
Views: 1478

Re: Save or invest?

For years we have invested whatever is left in the checking account above $10K at the end of each month. This is over and above normal retirement investing and 529. We're fortunate to almost always end the month with more in the account than we started with. Right now the excess goes to VTSAX. We r...
by Gufomel
Tue Mar 31, 2020 1:04 pm
Forum: Personal Investments
Topic: Why buy treasuries when CD rates are so much better?
Replies: 42
Views: 4442

Re: Why buy treasuries when CD rates are so much better?

The fact that big buyers of treasuries can't buy CD's is why the *total expected return* of treasuries is so much worse than best CD's. We'll see. I'm not putting all my eggs into either basket. Watchnerd has been a great help to me in other threads helping me understand why someone would buy a 20-...
by Gufomel
Tue Mar 31, 2020 6:19 am
Forum: Investing - Theory, News & General
Topic: Asset allocation strategies for accumulators
Replies: 36
Views: 2343

Re: Asset allocation strategies for accumulators

What does the bold part mean? What happens if one loses his job for a year during a recession in the accumulation phase? Is there a separate emergency fund? Pick the allocation you want to have when you're retired. Say that's 40/60. So you'd work until your current savings, multiplied by 6/4, equal...
by Gufomel
Mon Mar 30, 2020 4:08 pm
Forum: Investing - Theory, News & General
Topic: For a 20-year time horizon do bonds make sense any more?
Replies: 98
Views: 6063

Re: For a 20-year time horizon do bonds make sense any more?

Quick question if you don’t mind, the bolded part above, is “savings” included in your AA? The cash portion of your sig? Or do you consider that separate? We have "Rainy Day Savings", that is intended to be consumed (new cars, home remodels, vacations, etc.), and therefore not part of the AA listed...
by Gufomel
Mon Mar 30, 2020 3:57 pm
Forum: Investing - Theory, News & General
Topic: For a 20-year time horizon do bonds make sense any more?
Replies: 98
Views: 6063

Re: For a 20-year time horizon do bonds make sense any more?

[ I totally get why EE bonds don’t scale, but I guess for the same reason I ask myself why as a small-scale investor I wouldn’t take advantage of them over treasuries that yield almost nothing in comparison. $7,000 difference on a $10,000 investment (my example in previous post) is a heck of a lot ...
by Gufomel
Mon Mar 30, 2020 3:32 pm
Forum: Investing - Theory, News & General
Topic: For a 20-year time horizon do bonds make sense any more?
Replies: 98
Views: 6063

Re: For a 20-year time horizon do bonds make sense any more?

I probably gave a poor example. Yes if the explicit goal is to match a specific future liability, then yes 20 year TIPS makes sense. I guess I’m just trying to say I fail to see how rising interest rates would make an EE bond purchased today look less attractive in the future than a 20 year treasur...
by Gufomel
Mon Mar 30, 2020 3:21 pm
Forum: Investing - Theory, News & General
Topic: For a 20-year time horizon do bonds make sense any more?
Replies: 98
Views: 6063

Re: For a 20-year time horizon do bonds make sense any more?

I guess I don’t necessarily agree. If I’m looking to match a liability that’s 20 years in the future, I can either buy an EE bond at 3.5% or a 20 year treasury at 1.2% (for the sake of the discussion those are the 2 options). If rates rise, aren’t both investments equally less attractive than when ...
by Gufomel
Mon Mar 30, 2020 3:10 pm
Forum: Investing - Theory, News & General
Topic: For a 20-year time horizon do bonds make sense any more?
Replies: 98
Views: 6063

Re: For a 20-year time horizon do bonds make sense any more?

I believe they’ve always been guaranteed to double in 20 years, but in the past when rates were higher it would have been possible to earn greater than 3.5% so the “guaranteed to double” in 20 years didn’t matter . The annual interest alone resulted in it more than doubling in 20 years. But compara...