Search found 2683 matches

by Random Walker
Sat Apr 28, 2018 1:08 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: The Costs Of Implementing Momentum Strategies
Replies: 10
Views: 1235

Re: Larry Swedroe: The Costs Of Implementing Momentum Strategies

Caveat emptor: I am a factor novice, so I may be completely missing something here. All I have is strong skepticism towards people who claim to have market-beating strategies that they're willing to sell in a mass-market fund. I too had a difficult time understanding some of the performance data. B...
by Random Walker
Fri Apr 27, 2018 6:57 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: The Costs Of Implementing Momentum Strategies
Replies: 10
Views: 1235

Re: Larry Swedroe: The Costs Of Implementing Momentum Strategies

I’ll have to take a peek at the underlying papers referenced in Larry’s essay. But, as always, important for the investor to understand what the fund is doing. A fund can I suppose be anything from a long only equity fund that adds a momentum screen to the all out AQR long short funds that access mo...
by Random Walker
Fri Apr 27, 2018 6:07 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: The Costs Of Implementing Momentum Strategies
Replies: 10
Views: 1235

Larry Swedroe: The Costs Of Implementing Momentum Strategies

https://alphaarchitect.com/2018/04/26/costs-implementing-momentum-strategies/ I find momentum extremely interesting. I’m a pretty hard core believer in efficient markets. When I think of market efficiency, I have pictures in my head of the lines intersecting in Econ 1 or chemical equilibrium. That’s...
by Random Walker
Fri Apr 27, 2018 9:29 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Liquidity Risk Not Worth It
Replies: 35
Views: 5085

Larry Swedroe: Liquidity Risk Not Worth It

http://www.etf.com/sections/index-investor-corner/swedroe-liqudity-risk-not-worth-it?nopaging=1 In this essay, Larry reviews a paper that looks at liquidity risk in the corporate bond market. The conclusion is that liquidity risk is poorly compensated. This contradicts what economic theory would pre...
by Random Walker
Wed Apr 25, 2018 9:05 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Financial Perils Of Old Age
Replies: 94
Views: 11148

Larry Swedroe: Financial Perils Of Old Age

http://www.etf.com/sections/index-investor-corner/swedroe-financial-perils-old-age?nopaging=1 A very sobering article; addresses the issues and conversations we most avoid. Much of the article reviews or refers to a book on the topic: Hidden Truths About Retirement & Long Term Care by Carolyn Rosenb...
by Random Walker
Tue Apr 24, 2018 9:40 am
Forum: Investing - Theory, News & General
Topic: Vanguard factor funds slow to catch on
Replies: 50
Views: 5113

Re: Vanguard factor funds slow to catch on

I agree with Rick’s statement above. By taking the barbell approach, one accomplishes a couple of things. First of all, by using more of the cheap total market/core fund, you are keeping expenses low. By using the factor fund with deep factor exposure, the investor is using less of this more expensi...
by Random Walker
Mon Apr 23, 2018 2:16 pm
Forum: Investing - Theory, News & General
Topic: Vanguard factor funds slow to catch on
Replies: 50
Views: 5113

Re: Vanguard factor funds slow to catch on

Thank you Mister Ferri for this conversation. As far as the factor things, they will catch on soon, all of them wil in included in the future (balanced) "Vanguard Factor Target Retirement Series" --- Good luck, y gracias por leer ~cfs~ That’s pretty funny :-) but there is also a valuable point to b...
by Random Walker
Mon Apr 23, 2018 10:07 am
Forum: Investing - Theory, News & General
Topic: Vanguard factor funds slow to catch on
Replies: 50
Views: 5113

Re: Vanguard factor funds slow to catch on

I'm tempted to buy some of the value fund, but on the fence with the super low volume and lack of $s in it. Seems like a great way to add a value tilt. How do they keep the ER so low for an actively managed fund? This is one of the most appealing variables of this fund. It really depends on one’s d...
by Random Walker
Mon Apr 23, 2018 10:04 am
Forum: Investing - Theory, News & General
Topic: Vanguard factor funds slow to catch on
Replies: 50
Views: 5113

Re: Vanguard factor funds slow to catch on

Maybe they are slow to catch on because there are better products available. Each of the funds that have no net inflows focus on a single factor. It is more efficient to use core funds or funds with multi factor screens, then add on the single factor funds to get the specific factor exposure desired...
by Random Walker
Mon Apr 23, 2018 8:25 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: How Investors Undermine Returns
Replies: 8
Views: 1800

Larry Swedroe: How Investors Undermine Returns

http://www.etf.com/sections/index-investor-corner/swedroe-how-investors-undermine-returns?nopaging=1 Larry describes the disposition effect: our tendency to hold on to losers too long and sell winners too early. This has effects for the investor at both the individual stock level and the portfolio l...
by Random Walker
Sat Apr 21, 2018 1:16 pm
Forum: Investing - Theory, News & General
Topic: NYT article: Everyone should hire a financial planner
Replies: 103
Views: 9534

Re: NYT article: Everyone should hire a financial planner

Many here are viewing the advisor as a salesman of financial products. Advisor should only advise and manage the account. There should be 3 separate entities. 1. The advisor 2. The investment funds themselves 3. The holder of the accounts. For example, I have an independent fiduciary advisor who has...
by Random Walker
Sat Apr 21, 2018 11:08 am
Forum: Investing - Theory, News & General
Topic: NYT article: Everyone should hire a financial planner
Replies: 103
Views: 9534

Re: NYT article: Everyone should hire a financial planner

An investment adviser who provides extra services should also provides each client with a line-item invoice at least quarterly that lists each service and each cost during the period. That is what transparency means. It is what a fiduciary is expected to do. Hi Rick, Thanks for the detailed answer....
by Random Walker
Fri Apr 20, 2018 2:05 pm
Forum: Investing - Theory, News & General
Topic: NYT article: Everyone should hire a financial planner
Replies: 103
Views: 9534

Re: NYT article: Everyone should hire a financial planner

I will take the opposite side. The problem with being DIY is that you don't know what you don't know. You get into a emotional and cognitive bias that a 3rd party can help out. The state of the art moves forwards. We might debate if factor investing is worth it but there is always a new tax wrinkle...
by Random Walker
Fri Apr 20, 2018 7:44 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Chasing Returns A Hard Catch
Replies: 2
Views: 434

Larry Swedroe: Chasing Returns A Hard Catch

http://www.etf.com/sections/index-investor-corner/swedroe-chasing-returns-hard-catch Institutions tend to hire managers with good past records. The data shows though that looking forward, these managers tend to underperform the managers they replaced. Larry reviews an article that reveals just how u...
by Random Walker
Wed Apr 18, 2018 4:18 pm
Forum: Investing - Theory, News & General
Topic: Capital Efficiency Trumps Fees In Search For Portfolio Diversifiers
Replies: 9
Views: 1029

Re: Capital Efficiency Trumps Fees In Search For Portfolio Diversifiers

Not sure I’ve seen that specific article, but first learned the concept in his Only Guide To Right Financial Plan book. Core funds are cheapest and dominated from market beta which we are trying to diversify away from. Sometimes most efficient way to get the exposure and diversification we want is t...
by Random Walker
Wed Apr 18, 2018 2:44 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: What Hampers Pension Plans
Replies: 30
Views: 2982

Larry Swedroe: What Hampers Pension Plans

http://www.etf.com/sections/index-investor-corner/swedroe-what-hampers-pension-plans?nopaging=1 In this article Larry reviews the status of public pension plans. This is a good Boglehead article explaining the problems facing US public pensions. The lessons completely translate to us individual inve...
by Random Walker
Tue Apr 17, 2018 8:43 pm
Forum: Investing - Theory, News & General
Topic: Things have changed, so what do I do?
Replies: 14
Views: 2188

Re: Things have changed, so what do I do?

You’ve won the game and are running up the score it sounds like at this point. What is your AA? Perhaps cool off the AA further, maybe enjoy a higher withdrawal rate, keep your back to the net on the backhands, slight under spin on the volleys, and play the percentages by going cross court.

Dave
by Random Walker
Tue Apr 17, 2018 9:42 am
Forum: Investing - Theory, News & General
Topic: buying bonds
Replies: 8
Views: 756

Re: buying bonds

This is an excellent short book on bonds. Why Bother With Bonds by Rick Van Ness. It very directly answers the above issues. I strongly recommend it.

https://www.amazon.com/Why-Bother-Bonds ... bc?ie=UTF8

Dave
by Random Walker
Mon Apr 16, 2018 8:44 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Don’t Exclude Emerging Markets
Replies: 30
Views: 3377

Re: Larry Swedroe: Don’t Exclude Emerging Markets

Also, of course ISV is also diversified more across size and value in addition to the local economy effects

Dave
by Random Walker
Mon Apr 16, 2018 11:06 am
Forum: Investing - Theory, News & General
Topic: Unimpressive category averages of managed futures, multialternative, market neutral, etc.
Replies: 82
Views: 5782

Re: Unimpressive category averages of managed futures, multialternative, market neutral, etc.

I never bothered to run such numbers myself, shaking my head at the dubious premise underlying those 'alternatives', and quickly moving on to topics I deem more interesting. Siamomd, I intuitively super strongly believe in ruthless market efficiency too. This is what makes the behavioral anomalies ...
by Random Walker
Mon Apr 16, 2018 10:43 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Don’t Exclude Emerging Markets
Replies: 30
Views: 3377

Re: Larry Swedroe: Don’t Exclude Emerging Markets

Hi Lauretta, You wrote “I also like what is said about active management in the piece. I started investing last year and I thought that whilst indexing was better for the US market which is very efficient, active management should have a good chance in more inefficient markets like EM.” I think it i...
by Random Walker
Mon Apr 16, 2018 9:41 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Don’t Exclude Emerging Markets
Replies: 30
Views: 3377

Larry Swedroe: Don’t Exclude Emerging Markets

http://www.etf.com/sections/index-investor-corner/swedroe-dont-exclude-emerging-markets?nopaging=1 EM comprises about 1/8 of the world market cap. A 50% US / 50% Int investor might consider putting 25% of his international allocation in EM. Larry reviews some destructive investor behaviors in the pr...
by Random Walker
Mon Apr 16, 2018 9:03 am
Forum: Investing - Theory, News & General
Topic: Unimpressive category averages of managed futures, multialternative, market neutral, etc.
Replies: 82
Views: 5782

Re: Unimpressive category averages of managed futures, multialternative, market neutral, etc.

That’s why I said pick the premia you believe in, and choose the fund(s) that faithfully implement them in the most true, passive, cost efficient manner you can find. What premia do I believe in? How do I pick from the list of possible premia? How do I know which fund will faithfully implement them...
by Random Walker
Sun Apr 15, 2018 9:41 pm
Forum: Investing - Theory, News & General
Topic: Unimpressive category averages of managed futures, multialternative, market neutral, etc.
Replies: 82
Views: 5782

Re: Unimpressive category averages of managed futures, multialternative, market neutral, etc.

BigJohn, I agree picking winners based on performance not the greatest idea. That’s why I said pick the premia you believe in, and choose the fund(s) that faithfully implement them in the most true, passive, cost efficient manner you can find. Sort of look forward more than backward. I can see why p...
by Random Walker
Sun Apr 15, 2018 10:59 am
Forum: Investing - Theory, News & General
Topic: Unimpressive category averages of managed futures, multialternative, market neutral, etc.
Replies: 82
Views: 5782

Re: Unimpressive category averages of managed futures, multialternative, market neutral, etc.

Had a little trouble following this, but with such diverse funds falling under the generic names “Managed Futures, market neutral, multialternative” doesn’t seem fair to group a bunch together and take average. Probably to evaluate each fund individually. But now you're back to picking one of the f...
by Random Walker
Sat Apr 14, 2018 8:33 pm
Forum: Investing - Theory, News & General
Topic: Unimpressive category averages of managed futures, multialternative, market neutral, etc.
Replies: 82
Views: 5782

Re: Unimpressive category averages of managed futures, multialternative, market neutral, etc.

Had a little trouble following this, but with such diverse funds falling under the generic names “Managed Futures, market neutral, multialternative” doesn’t seem fair to group a bunch together and take average. Probably to evaluate each fund individually.

Dave
by Random Walker
Sat Apr 14, 2018 10:53 am
Forum: Investing - Theory, News & General
Topic: Factor Investing - A convincing article
Replies: 67
Views: 6215

Re: Factor Investing - A convincing article

I’ve been factor investing since 2000, so while value and small has indeed underperformed recently, over my time period it has done very well, so I don’t think a few bad years means factor investing is dead. In fact, when people start thinking factor investing is dead, I suspect the opposite. I thi...
by Random Walker
Fri Apr 13, 2018 8:20 am
Forum: Investing - Theory, News & General
Topic: Bull Market Timing
Replies: 60
Views: 4914

Re: Bull Market Timing

I agree somewhat with OP. I think it depends on stage of investing life cycle. If one is early, probably best to just keep saving and stick to the AA. If one is near to retirement or early retirement, probably a good time to see where one is financially relative to goals, consider needs versus wants...
by Random Walker
Thu Apr 12, 2018 9:36 am
Forum: Investing - Theory, News & General
Topic: Nice Explanation of Volatility Drag
Replies: 4
Views: 547

Re: Nice Explanation of Volatility Drag

Given the recent market volatility, I thought I’d resurrect the issue of volatility drag on a portfolio. A more efficient portfolio keeps expected return constant, but likely will result in a higher geometric mean return. It’s the geo mean that matters. Diversification across sources of risk and ret...
by Random Walker
Wed Apr 11, 2018 1:54 pm
Forum: Investing - Theory, News & General
Topic: Factor Investing - A convincing article
Replies: 67
Views: 6215

Re: Factor Investing - A convincing article

Penny stocks I believe are a known anomaly, frequently screened out of SV funds.

Dave
by Random Walker
Wed Apr 11, 2018 12:33 pm
Forum: Investing - Theory, News & General
Topic: Capital Efficiency Trumps Fees In Search For Portfolio Diversifiers
Replies: 9
Views: 1029

Capital Efficiency Trumps Fees In Search For Portfolio Diversifiers

https://www.advisorperspectives.com/articles/2018/04/09/capital-efficiency-trumps-fees-in-the-search-for-portfolio-diversifiers I ran across this article while looking around AdvisorPerspectives.com. The point of the article is that cost is not what matters, it is cost per unit value added. When one...
by Random Walker
Wed Apr 11, 2018 10:35 am
Forum: Investing - Theory, News & General
Topic: Factor Investing - A convincing article
Replies: 67
Views: 6215

Re: Factor Investing - A convincing article

At the limits of my knowledge here. I know the answer is in Antti Ilmanen’s book Expected Returns though. I know it’s one of the very best books, but I haven’t been able to make myself get through it. My understanding is that because value companies tend to be highly leveraged, have wide variability...
by Random Walker
Wed Apr 11, 2018 9:28 am
Forum: Investing - Theory, News & General
Topic: Factor Investing - A convincing article
Replies: 67
Views: 6215

Re: Factor Investing - A convincing article

I actually thought it was a very poor article. Obviously, from my factor junkie point of view, there is some serious confirmation bias at work here. Nonetheless, here’s what I felt was wrong with the article. I know Alan is one of the good guys, but even from my naive, non financial point of view, t...
by Random Walker
Wed Apr 11, 2018 8:21 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Don’t Underestimate Buyback Power
Replies: 12
Views: 2470

Larry Swedroe: Don’t Underestimate Buyback Power

http://www.etf.com/sections/index-investor-corner/swedroe-dont-underestimate-buyback-power There are three ways a company can give money back to its investors: dividends, distributions from buyback of shares, and buyback resulting in the investor owning an increased proportion of the company. A famo...
by Random Walker
Wed Apr 11, 2018 8:00 am
Forum: Investing - Theory, News & General
Topic: Factor Investing - A convincing article
Replies: 67
Views: 6215

Re: Factor Investing - A convincing article

Also, I believe when companies are divided into deciles, the return rises monotonically with decreasing size decile.

Dave
by Random Walker
Wed Apr 11, 2018 7:14 am
Forum: Investing - Theory, News & General
Topic: Factor Investing - A convincing article
Replies: 67
Views: 6215

Re: Factor Investing - A convincing article

One way to view the extra risk of value stocks is when they do poorly. Value stocks may get hit harder in a recession than safer growth stocks. The extra risk is the stock does poorly at the same time I lose my job: doing badly in bad times.

Dave
by Random Walker
Tue Apr 10, 2018 1:32 pm
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 237
Views: 16130

Re: Swedroe: Look Beyond 60/40 Portfolio

Whakamole,
You sort of answered your own question. Nothing is certain. Diversification is the only free lunch in investing. Although I wouldn’t be at all surprised if many would argue that currently the pre tax expected return of at least some of the alts is higher than equities.

Dave
by Random Walker
Tue Apr 10, 2018 12:13 pm
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 237
Views: 16130

Re: Swedroe: Look Beyond 60/40 Portfolio

Call Me Op,
Your question is the same one that has bothered me. I would really like to get a solid answer. I would think valuation changes, reversion to the mean, would be a huge part of the predictive nature of CAPE10.

Dave
by Random Walker
Tue Apr 10, 2018 10:56 am
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 237
Views: 16130

Re: Swedroe: Look Beyond 60/40 Portfolio

[Post removed by admin LadyGeek] Good to be skeptical, but bad to let skepticism cloud your vision. I think if you read more of Larry’s books and essays, you’ll find that clarity of thought, internal consistency, and integrity leaps off the pages. He’s posted here like 10,000 times, written I think...
by Random Walker
Tue Apr 10, 2018 8:20 am
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 237
Views: 16130

Re: Swedroe: Look Beyond 60/40 Portfolio

stlutz, thanks for the response. I fully agree with your points that it's a concern to think of these as being an alternative to much safer fixed income assets. It's a deal breaker for me having decided to lower my portfolio risk in early retirement. They could be appropriate for others as long as ...
by Random Walker
Mon Apr 09, 2018 9:42 pm
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 237
Views: 16130

Re: Swedroe: Look Beyond 60/40 Portfolio

BigJohn,
I am invested in all the alternatives we’ve discussed. Part of the reason I am invested in the Stone Ridge funds is the illiquidity premium.

Dave
by Random Walker
Mon Apr 09, 2018 8:20 pm
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 237
Views: 16130

Re: Swedroe: Look Beyond 60/40 Portfolio

Stlutz,
Here’s one paper on Alternative Risk Premia

https://www.aqr.com/-/media/AQR/Documen ... ia_vff.pdf

I realize it’s AQR promoting one of its own funds, but I think it’s very worthwhile nonetheless.

Dave
by Random Walker
Mon Apr 09, 2018 4:01 pm
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 237
Views: 16130

Re: Swedroe: Look Beyond 60/40 Portfolio

If, on the other hand, one looks for incremental return by adding unique and independent risks/ sources of return, then there is a reasonable chance some of them will go down less or maybe be positive at the bad times for market beta. There is not enough history on these new products to say whether...
by Random Walker
Mon Apr 09, 2018 2:41 pm
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 237
Views: 16130

Re: Swedroe: Look Beyond 60/40 Portfolio

Marcopolo, This is at the limits of my knowledge, but here’s my answer anyways. First of all, I believe CCFs I think provide the best protection in inflationary times when stocks and bonds tank. 2007-9 was deflationary period. So a different type of risk showed up. As far as why no more CCF recomme...
by Random Walker
Mon Apr 09, 2018 1:32 pm
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 237
Views: 16130

Re: Swedroe: Look Beyond 60/40 Portfolio

Hilink, Longinvest, your points are probably valid. Of course do costs matter. But Swedroe is discussing how to diversify a standard portfolio of equities and bonds and not replacing a broad total-market index funds with an actively managed one. Diversify a portfolio like he advocated in 2008? Let'...
by Random Walker
Mon Apr 09, 2018 12:49 pm
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 237
Views: 16130

Re: Swedroe: Look Beyond 60/40 Portfolio

Longinvest, CCFs act as a form of insurance for a portfolio. If the catastrophe doesn’t play out, it doesn’t mean the insurance purchase was a mistake. Moreover, one must look at the portfolio as a whole. Part of Larry’s recommendation is to extend bond duration in the presence of CCFs, and people w...
by Random Walker
Mon Apr 09, 2018 10:33 am
Forum: Investing - Theory, News & General
Topic: Expanding on The Rewards Of Multiple Asset Class Investing
Replies: 46
Views: 4791

Re: Expanding on The Rewards Of Multiple Asset Class Investing

Thought I’d give this post another bump in light of some recent threads, especially the one on Larry’s article : Looking beyond 60/40 Portfolio.

Dave
by Random Walker
Mon Apr 09, 2018 10:19 am
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 237
Views: 16130

Re: Swedroe: Look Beyond 60/40 Portfolio

Longinvest, There is a difference between an efficient market and an efficient portfolio. Unfortunately, potential improvements to a portfolio come at increased cost. And as one gets fancier, the marginal costs increase. The best diversifier is the cheapest: bonds. The improvements are only potentia...