Search found 539 matches

by Gufomel
Mon Mar 30, 2020 2:58 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 2:45 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?

Dumb question but can someone elaborate on the 3.5% rate on the EE bond and what that means? What would the final value be of a $10,000 EE bond be after 20 years, counting principal and interest? TIA. EE bonds double your initial principal at 20 years. If you invest $10k, you would have $20k after ...
by Gufomel
Mon Mar 30, 2020 2:28 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?

But is it worth it for the extra yield? Maybe. You know this stuff WAY better than me, and have a specific process laid out that you follow. But 20 year treasuries are at roughly 1.2% now? That’s about $12,700 in 20 years vs $20,000 for EE bonds. Seems hard to argue it’s not at least worth serious ...
by Gufomel
Mon Mar 30, 2020 1:59 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?

Dumb question but can someone elaborate on the 3.5% rate on the EE bond and what that means? What would the final value be of a $10,000 EE bond be after 20 years, counting principal and interest? TIA. EE bonds double your initial principal at 20 years. If you invest $10k, you would have $20k after ...
by Gufomel
Mon Mar 30, 2020 1:47 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?

Dumb question but can someone elaborate on the 3.5% rate on the EE bond and what that means? What would the final value be of a $10,000 EE bond be after 20 years, counting principal and interest? TIA. EE bonds double your initial principal at 20 years. If you invest $10k, you would have $20k after ...
by Gufomel
Mon Mar 30, 2020 10:31 am
Forum: Investing - Theory, News & General
Topic: Great example of someone who should have never invested in factors
Replies: 119
Views: 8369

Re: Great example of someone who should have never invested in factors

What’s the main information driver of people deciding to get into these funds? Advisors? Financial writers? Top level advertising from brokerages? Larry Swedroe and Paul Merriman are at least very consistent with their messages on the need for holding for life. Most others are not, I suspect. Mr. B...
by Gufomel
Mon Mar 30, 2020 7:11 am
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?

HEDGEFUNDIE wrote: Sun Mar 29, 2020 11:58 pm A great discussion on an unrelated thread that speaks to why the outlook for EE bonds is superior to I bonds.

viewtopic.php?p=5145597#p5145597
I couldn’t find the EE bond discussion on that thread. Do you know what page it’s on?
by Gufomel
Sun Mar 29, 2020 10:07 am
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?

When looking at LTT vs EE bonds, at face value EE bonds seem like the way better deal at 3.5% if held to maturity vs LTT at 1.5%. I’m trying to figure out why I’m the world you would buy LTT right now. Aside from the purchase limitations on EE bonds, what am I missing? A couple thoughts: 1) You hav...
by Gufomel
Sun Mar 29, 2020 6:53 am
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?

When looking at LTT vs EE bonds, at face value EE bonds seem like the way better deal at 3.5% if held to maturity vs LTT at 1.5%. I’m trying to figure out why I’m the world you would buy LTT right now. Aside from the purchase limitations on EE bonds, what am I missing? A couple thoughts: 1) You have...
by Gufomel
Sat Mar 28, 2020 7:16 am
Forum: Investing - Theory, News & General
Topic: TIPS
Replies: 271
Views: 20706

Re: TIPS go Crazy!

If the investor did NOT need $XXX in 2045 (the condition necessary for "rebalancing" to make any sense), why did they purchase the TIPS to begin with? If the liability is nominal, why not a nominal bond? If the liability is uncertain, why not a target duration bond fund? Selling TIPS before maturit...
by Gufomel
Fri Mar 27, 2020 5:06 pm
Forum: Investing - Theory, News & General
Topic: TIPS
Replies: 271
Views: 20706

Re: TIPS go Crazy!

The theory makes sense. I struggle with the practical application of it. How do you align the idea of matching duration to investment timeline (or maybe that’s not something you espouse). If looking at everything as a whole portfolio, that means it’s not just long-term retirement goals. Shorter-ter...
by Gufomel
Fri Mar 27, 2020 4:49 pm
Forum: Investing - Theory, News & General
Topic: TIPS
Replies: 271
Views: 20706

Re: TIPS go Crazy!

I assume by “smoother ride” you’re referring to total portfolio performance - not that VGLT itself is a smoother ride than BND? The “first 20% in LTT” makes sense at some level - I’ve seen the post you linked recently. The part I struggle with is that I have an EF, but outside of that I look at my ...
by Gufomel
Fri Mar 27, 2020 2:46 pm
Forum: Investing - Theory, News & General
Topic: TIPS
Replies: 271
Views: 20706

Re: TIPS go Crazy!

Vanguard Total Bond Market ETF (BND) and Vanguard Long-Term Treasury ETF (VGLT) have nearly identical YTMs right now, so switching is arguably neither performance chasing nor market timing (I hope). VGLT is unlikely to outperform BND over your investment horizon, but it should definitely create a s...
by Gufomel
Fri Mar 27, 2020 1:58 pm
Forum: Investing - Theory, News & General
Topic: TIPS
Replies: 271
Views: 20706

Re: TIPS go Crazy!

Could you help me understand the logic here? Is it that your 15% allocation to LTT (based on your sig) is large enough that in the event of a down equity market, the LTT would increase in value enough to rebalance LTT to Equity and still maintain 15% in LTT and not have to tap into TIPS at all? Tha...
by Gufomel
Fri Mar 27, 2020 1:38 pm
Forum: Personal Investments
Topic: Mid term 7 year investing
Replies: 5
Views: 319

Re: Mid term 7 year investing

The current yield for BND is 1.90%. The 10 year average of 3.66% isn’t helpful for determining what return you should expect going forward because yields are currently at historical lows. Don’t invest in BND right now expecting a 3.66% return over the next 7 years. That’s highly unlikely at today’s ...
by Gufomel
Fri Mar 27, 2020 11:47 am
Forum: Investing - Theory, News & General
Topic: TIPS
Replies: 271
Views: 20706

Re: TIPS go Crazy!

I might even go so far as to say that an asset allocation should generally hold enough nominal LTTs that the portfolio would never need to rebalance out of TIPS and into equities , though I'm still pondering this notion. That's the exactly rebalancing rule I use for LTT vs short TIPS. Could you hel...
by Gufomel
Fri Mar 27, 2020 9:04 am
Forum: Investing - Theory, News & General
Topic: TIPS
Replies: 271
Views: 20706

Re: TIPS go Crazy!

Thanks. I’m probably confusing yield with 30-day SEC yield. When the 30-day SEC yield is negative, what does that actually mean? SEC yield is, more or less, a version of yield to maturity. But, I think it can be confusing with TIPS funds, I believe Vanguard reports it as a real yield for their TIPS...
by Gufomel
Fri Mar 27, 2020 8:31 am
Forum: Investing - Theory, News & General
Topic: TIPS
Replies: 271
Views: 20706

Re: TIPS go Crazy!

When a TIPS fund has a negative yield, do you actually have money pulled out of the fund at distribution dates rather than receive a distribution? This is probably a really ignorant question. I’m learning a lot about nominal treasuries/TIPS right now. Well, the “learning” part might not be accurate...
by Gufomel
Fri Mar 27, 2020 8:19 am
Forum: Investing - Theory, News & General
Topic: TIPS
Replies: 271
Views: 20706

Re: TIPS go Crazy!

When a TIPS fund has a negative yield, do you actually have money pulled out of the fund at distribution dates rather than receive a distribution? This is probably a really ignorant question. I’m learning a lot about nominal treasuries/TIPS right now. Well, the “learning” part might not be accurate ...
by Gufomel
Thu Mar 26, 2020 1:51 pm
Forum: Personal Investments
Topic: Locking in Losses for a Newbie (TLH?)
Replies: 16
Views: 805

Re: Locking in Losses for a Newbie (TLH?)

Selling your international fund at a loss and then buying a similar international fund in order to claim the loss (otherwise called Tax Loss Harvesting - TLH) would likely be a smart move. However, selling your international fund to purchase a US fund is a significant shift in asset classes. You men...
by Gufomel
Wed Mar 25, 2020 4:30 pm
Forum: Investing - Theory, News & General
Topic: TIPS funds
Replies: 2
Views: 447

Re: TIPS funds

I also noticed that the breakeven inflation rate is currently very low. Does that mean TIPS are “cheap” right now? Not in the sense that you can predict that it’s a better investment than another alternative, but in the sense that because expectations for inflation are so low, there’s some upside in...
by Gufomel
Wed Mar 25, 2020 4:13 pm
Forum: Investing - Theory, News & General
Topic: TIPS funds
Replies: 2
Views: 447

TIPS funds

I think I have at least a basic understanding of how TIPS work, but I’m struggling with understanding how a TIPS fund works and what to expect from yield and price movement based on changes in interest rates and inflation. First of all, the Vanguard Short Term TIPS fund (VTAPX) has a 30-day SEC yiel...
by Gufomel
Wed Mar 25, 2020 1:42 pm
Forum: Personal Investments
Topic: Guys I Rebalanced (Moved Monies Out Of S&P 500)
Replies: 301
Views: 18485

Re: Guys I Rebalanced (Moved Monies Out Of S&P 500)

You guys have stated the issue with this is that I can miss a major UP day, but I'm not sure how a major UP day is coming while The Great Shutdown is active? How can that possibly happen? Welp, yesterday 3/24/2020 was the 8th largest % UP day in the history of the S&P and the largest ever outside o...
by Gufomel
Wed Mar 25, 2020 8:29 am
Forum: Investing - Theory, News & General
Topic: Book on LT Treasuries?
Replies: 5
Views: 375

Re: Book on LT Treasuries?

What’s the reason for this primarily just being for those with 80/20 or higher allocation? I also recall mention somewhere on this forum that 70/30 with the “30” being split between LT Treasuries & ST TIPS is better on the efficient frontier than 60/40 with the “40” just being in Total Bonds. Is tha...
by Gufomel
Wed Mar 25, 2020 8:21 am
Forum: Investing - Theory, News & General
Topic: Book on LT Treasuries?
Replies: 5
Views: 375

Re: Book on LT Treasuries?

bgf wrote: Wed Mar 25, 2020 8:02 am sounds like Swedroe's "The Only Guide You'll Ever Need." For portfolios with 80% equity or higher allocation, he prefers long term treasuries for bond allocation. the higher returns beat out the higher volatility of such an equity heavy portfolio.
Thank you!
by Gufomel
Wed Mar 25, 2020 7:52 am
Forum: Investing - Theory, News & General
Topic: Book on LT Treasuries?
Replies: 5
Views: 375

Book on LT Treasuries?

I remember several people referring to a great book on LT Treasuries, but I can’t find the name of it now. It might have been by Swedroe? I’m not sure if the book is specifically about LT Treasuries, but my understanding was that a major premise of the strategy outlined in the book is that LT Treasu...
by Gufomel
Wed Mar 25, 2020 7:34 am
Forum: Investing - Theory, News & General
Topic: Why did the Futures open flat?
Replies: 13
Views: 955

Re: Why did the Futures open flat?

The market is a bet on the future. The market made a very large bet yesterday that the bill would be signed, and it was. No inside information required.
by Gufomel
Tue Mar 24, 2020 7:41 pm
Forum: Investing - Theory, News & General
Topic: Bond Strategy
Replies: 69
Views: 4900

Re: Bond Strategy

I wonder if a better strategy is 33% Int. Treasuries, 33% Total Bond, and 33% Inflation Protected Bonds. Maybe even add stable value/money market into the mix possibly. Am I overthinking this? Over-complicating it, I'd say more than over-thinking it. All asset allocation decisions SHOULD start by t...
by Gufomel
Tue Mar 24, 2020 4:20 pm
Forum: Investing - Theory, News & General
Topic: What is the point of stocks?
Replies: 101
Views: 6718

Re: What is the point of stocks?

LOL when I clicked this thread I genuinely thought this was going to be a tongue in cheek post in response to the onslaught of “What’s the point of bonds”, or “What’s the point of cash” posts we’ve endured for the past few years. Sure, cherry pick the height of a bubble 20 years ago and the middle o...
by Gufomel
Tue Mar 24, 2020 9:29 am
Forum: Personal Investments
Topic: Guys I Rebalanced (Moved Monies Out Of S&P 500)
Replies: 301
Views: 18485

Re: Guys I Rebalanced (Moved Monies Out Of S&P 500)

WIAV8TOR wrote: Tue Mar 24, 2020 9:24 am I’m not a ‘market timer’(Bob’s newsletter), but nothing wrong with increasing in a few areas in dips, rebalancing when high.

One doesn’t have to identify the absolute bottom, 30% down is close enough.
OP wasn’t actually rebalancing, he was selling out of stocks.
by Gufomel
Tue Mar 24, 2020 9:06 am
Forum: Personal Investments
Topic: Guys I Rebalanced (Moved Monies Out Of S&P 500)
Replies: 301
Views: 18485

Re: Guys I Rebalanced (Moved Monies Out Of S&P 500)

If you don’t sell then you’re guaranteed not to gain or lose any equity. If you do, you might make money or you might lose it forever (yes a 10% one-day move is possible, or smaller ones that your gut tells you aren’t the rebound is my guess); it’s called gambling and you might as well withdraw 25%...
by Gufomel
Mon Mar 23, 2020 7:41 pm
Forum: Personal Consumer Issues
Topic: What's cheap right now?
Replies: 33
Views: 3815

Re: What's cheap right now?

Phineas J. Whoopee wrote: Mon Mar 23, 2020 7:34 pm Advice. Speculation. Assertions.
PJW
Bravo. Well done.
by Gufomel
Mon Mar 23, 2020 7:03 am
Forum: Personal Investments
Topic: Selling 100% stocks on a bounce
Replies: 256
Views: 22477

Re: Selling 100% stocks on a bounce

The number of capitulation threads on here give me hope that we are near the bottom.
by Gufomel
Sun Mar 22, 2020 6:28 am
Forum: Personal Finance (Not Investing)
Topic: Ally Bank CD rate & timing of funding
Replies: 8
Views: 817

Re: Ally Bank CD rate & timing of funding

Thanks all. Makes sense that it will give the 10 day guarantee after 10 days. One point of clarification, it’s not an issue of being over or under $25,000, at least in my case. They’re all under $25,000 (I wanted to do several smaller ones in case I want to break them in smaller amounts for bank bon...
by Gufomel
Sun Mar 22, 2020 5:56 am
Forum: Personal Finance (Not Investing)
Topic: Ally Bank CD rate & timing of funding
Replies: 8
Views: 817

Ally Bank CD rate & timing of funding

On Sunday night I opened a few Ally Bank 11-month No Penalty CDs at a rate of 1.70%. I was able to fund 2 of them. But I needed to move money from another account in order to fund the remaining 2. I completed the funding on Tuesday. When I look at my account now, the 2 that I funded immediately show...
by Gufomel
Sat Mar 21, 2020 9:11 pm
Forum: Personal Investments
Topic: Guys I Rebalanced (Moved Monies Out Of S&P 500)
Replies: 301
Views: 18485

Re: Guys I Rebalanced (Moved Monies Out Of S&P 500)

Guys, thanks a lot for all of the comments and I really appreciate it. Quite honestly, I know I'm not the only person (Millennial or other Generation) that is feeling scared out of their minds right now and they might be reading this forum. So I can assure you I'm not "trolling" and yes, I recently...
by Gufomel
Wed Mar 18, 2020 11:23 am
Forum: Personal Consumer Issues
Topic: Cruise cancelled [take refund or future credit?]
Replies: 51
Views: 2824

Re: Cruise cancelled [take refund or future credit?]

Take the refund and invest it. I’d say the expected return is higher than taking the credit and hoping the cruise line stays afloat (pun intended).
by Gufomel
Wed Mar 18, 2020 6:26 am
Forum: Personal Investments
Topic: How to calculate the impact of a rate change increase on Treasury funds
Replies: 1
Views: 147

How to calculate the impact of a rate change increase on Treasury funds

I have a basic understanding of how yields/prices work for individual bonds, but does it work essentially the same for funds? The Vanguard Intermediate Treasury Fund has a 30-day SEC yield of 1% (as of 3/16/2020). Yield to Maturity is 1%, Average Maturity is 5.5 years, Average Duration is 5.2 years ...
by Gufomel
Mon Mar 16, 2020 9:03 am
Forum: Personal Investments
Topic: If under FDIC limit, move all intermediate bonds to No-Penalty CD?
Replies: 24
Views: 1332

Re: If under FDIC limit, move all intermediate bonds to No-Penalty CD?

Excellent suggestion on opening tonight and funding this week. Thanks guys. Still welcome thoughts if I’m missing anything. I guess the concern is just that I’m going to very short term fixed income. Is that a problem? I don’t see why to hold longer term funds at lower rates, so it sounds right to ...
by Gufomel
Sun Mar 15, 2020 8:46 pm
Forum: Personal Investments
Topic: If under FDIC limit, move all intermediate bonds to No-Penalty CD?
Replies: 24
Views: 1332

Re: If under FDIC limit, move all intermediate bonds to No-Penalty CD?

It looks like after I select “add money later”, it says I’ve “chosen to fund a CD account by mail or wire transfer”. Are those the only 2 options? I can’t just transfer from an Ally account? Transfer from Ally accounts and ACH from outside still works. Go to Transfer and set up a mock transfer to c...
by Gufomel
Sun Mar 15, 2020 8:33 pm
Forum: Personal Investments
Topic: If under FDIC limit, move all intermediate bonds to No-Penalty CD?
Replies: 24
Views: 1332

Re: If under FDIC limit, move all intermediate bonds to No-Penalty CD?

It looks like after I select “add money later”, it says I’ve “chosen to fund a CD account by mail or wire transfer”. Are those the only 2 options? I can’t just transfer from an Ally account?
by Gufomel
Sun Mar 15, 2020 8:30 pm
Forum: Personal Investments
Topic: If under FDIC limit, move all intermediate bonds to No-Penalty CD?
Replies: 24
Views: 1332

Re: If under FDIC limit, move all intermediate bonds to No-Penalty CD?

Open the CD tonight at today’s interest rate and fund it during the week. I’ve never set up a CD and chosen to fund later with Ally (I’ve always just funded directly from my Ally checking account). I just tried it, and after setting up the CD I don’t see an option to fund it. Are you familiar with ...
by Gufomel
Sun Mar 15, 2020 8:21 pm
Forum: Personal Investments
Topic: If under FDIC limit, move all intermediate bonds to No-Penalty CD?
Replies: 24
Views: 1332

Re: If under FDIC limit, move all intermediate bonds to No-Penalty CD?

Open the CD tonight at today’s interest rate and fund it during the week. I’ve never set up a CD and chosen to fund later with Ally (I’ve always just funded directly from my Ally checking account). I just tried it, and after setting up the CD I don’t see an option to fund it. Are you familiar with ...
by Gufomel
Sun Mar 15, 2020 7:30 pm
Forum: Personal Investments
Topic: If under FDIC limit, move all intermediate bonds to No-Penalty CD?
Replies: 24
Views: 1332

Re: If under FDIC limit, move all intermediate bonds to No-Penalty CD?

Excellent suggestion on opening tonight and funding this week. Thanks guys. Still welcome thoughts if I’m missing anything. I guess the concern is just that I’m going to very short term fixed income. Is that a problem? I don’t see why to hold longer term funds at lower rates, so it sounds right to m...
by Gufomel
Sun Mar 15, 2020 6:18 pm
Forum: Personal Investments
Topic: If under FDIC limit, move all intermediate bonds to No-Penalty CD?
Replies: 24
Views: 1332

If under FDIC limit, move all intermediate bonds to No-Penalty CD?

At this point is there any significant reason to hold Total Bond Market or Intermediate Treasury funds? Ally Bank’s 11-month no-penalty CD is 1.75%. Not sure if that will hold until Tuesday when I’d be able to have my bond funds liquidated and moved to Ally. But if so, what’s the reason not to? Plea...
by Gufomel
Fri Mar 13, 2020 9:49 am
Forum: Personal Investments
Topic: How do Treasuries make sense over Money Market?
Replies: 10
Views: 609

Re: How do Treasuries make sense over Money Market?

In general that first step is to stop looking at risk in bonds and consider risk and return of your whole portfolio. If you hold both stocks and bonds then the portfolio risk is dominated by stock risk and the difference between one bond fund or another is not very important. Yes, that's a bit of t...
by Gufomel
Fri Mar 13, 2020 9:37 am
Forum: Personal Investments
Topic: How do Treasuries make sense over Money Market?
Replies: 10
Views: 609

Re: How do Treasuries make sense over Money Market?

A characteristic of the market right now is a flat yield curve. On the average longer durations also give higher returns, which is why an intermediate index fund tends to make more sense as a long term holding. You can follow how the yield curve has evolved over time by looking here and dragging th...
by Gufomel
Fri Mar 13, 2020 8:19 am
Forum: Personal Investments
Topic: How do Treasuries make sense over Money Market?
Replies: 10
Views: 609

How do Treasuries make sense over Money Market?

I'm about 80/20 stock bonds in my early 30's and not panicking in the least on the stocks side (in fact, just rebalanced into stocks at end of day yesterday). I'm a little concerned on the bond side though, starting to realize I may not have fully assessed my comfortability with my bond holdings. My...
by Gufomel
Fri Mar 13, 2020 7:19 am
Forum: Investing - Theory, News & General
Topic: [Bond ETFs Face Toughest Liquidity Test Yet 3/12/20]
Replies: 42
Views: 2648

Re: BND Down 5.44% but VBTLX down just .96%

I've never owned either, but why not just buy BND then? Wouldn't it be basically like a guaranteed 4.5% return when things return to normal? That's a string of logic I came to as well. I had the same thought, but it was checked by thinking about the underlying bonds. In situations of insufficient l...
by Gufomel
Thu Mar 12, 2020 8:02 pm
Forum: Investing - Theory, News & General
Topic: Which is more accurate after the markets close - ETF price or fund NAV?
Replies: 6
Views: 472

Which is more accurate after the markets close - ETF price or fund NAV?

There’s some pretty significant differences in fund and ETF daily changes today for the identical funds, particularly bonds but also some stock funds. I understand this is at least in part due to liquidity issues. I know that during the day an ETF price is obviously more real-time than a fund’s prev...