Search found 3309 matches

by Random Walker
Tue Nov 06, 2018 10:11 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: What To Do When An Investment Strategy Performs Poorly
Replies: 11
Views: 1779

Larry Swedroe: What To Do When An Investment Strategy Performs Poorly

https://www.advisorperspectives.com/articles/2018/11/05/what-to-do-when-an-investment-strategy-performs-poorly This is an important article. In just a couple of pages, it presents what I think are the biggest conclusions to be drawn from Larry’s Your Complete Guide To Factor Based Investing. In a we...
by Random Walker
Sun Nov 04, 2018 4:08 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Asset Diversification In A Flat World
Replies: 8
Views: 924

Re: Larry Swedroe: Asset Diversification In A Flat World

Staythecourse, Agree. Who knows what currencies will do. Also agree that if US stocks are indeed safer (for whatever reasons), then their expected returns should be lower. The current P/E ratios of Int and EM are depressed relative to US. The market prices risk, and these P/E’s reflect increased ris...
by Random Walker
Sun Nov 04, 2018 3:56 pm
Forum: Investing - Theory, News & General
Topic: Is Small Value Still A Winner?
Replies: 96
Views: 7054

Re: Is Small Value Still A Winner?

Nedsaid, Agree. Got to admit though, that quality/profitability sort of gives me the heebie jeebies. It seems to push everything in a growthy direction, which then makes me wonder why I’m tilting at all. In fact Larry has said that one positive additional side effect of quality/profitability screen ...
by Random Walker
Sun Nov 04, 2018 3:13 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Asset Diversification In A Flat World
Replies: 8
Views: 924

Re: Larry Swedroe: Asset Diversification In A Flat World

Overall, wouldn’t currency swings be expected to be random? They likely have equal chance of helping or hurting the investor. And if the world is becoming more flat economically, likely more of our purchases involve products produced internationally as well? A lot of people seem to believe in the 50...
by Random Walker
Sun Nov 04, 2018 11:51 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Asset Diversification In A Flat World
Replies: 8
Views: 924

Re: Larry Swedroe: Asset Diversification In A Flat World

Columbia, Think that is the wrong conclusion. I think diversification is more important the shorter one’s timespan. The shorter the time period, the more random the returns of various factors. I think diversifying across factors (sources of return) is always important, but perhaps more important ove...
by Random Walker
Sun Nov 04, 2018 11:24 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Asset Diversification In A Flat World
Replies: 8
Views: 924

Larry Swedroe: Asset Diversification In A Flat World

https://alphaarchitect.com/2018/11/01/asset-diversification-in-a-flat-world/ Larry reviews a paper entitled Nowhere To Run, Nowhere To Hide: Asset Diversification In A Flat World. The investment world really is becoming more flat, and as country’s economies become more integrated, the benefits of ge...
by Random Walker
Sat Nov 03, 2018 11:51 am
Forum: Investing - Theory, News & General
Topic: no dividends in index funds!
Replies: 95
Views: 9413

Re: no dividends in index funds!

Hi Marcopolo, I’ll call it semi momentary brain lapse. But I must confess, I don’t know a lot about taxes. I do appreciate that taxes are frequently the biggest portfolio expense, but I have loosened up on the tax efficiency mantra some in favor of not letting the tax tail wag the investing dog. As...
by Random Walker
Sat Nov 03, 2018 11:40 am
Forum: Investing - Theory, News & General
Topic: Is Small Value Still A Winner?
Replies: 96
Views: 7054

Re: Is Small Value Still A Winner?

I believe all the factors are stronger in small stocks: value stronger in small, momentum stronger in small, profitability stronger in small. People have argued whether or not there is a risk premium associated with size. I believe there is. Whether there is or not though, one could rationally tilt ...
by Random Walker
Sat Nov 03, 2018 1:44 am
Forum: Investing - Theory, News & General
Topic: no dividends in index funds!
Replies: 95
Views: 9413

Re: no dividends in index funds!

Dividend policy is irrelevant to a stock’s total return I believe. Think there was a Nobel prize involved in that work. Dividends tend to be a not so great proxy for value stocks. The nice thing, I would think, about avoiding dividend stocks, is that one can decide when to sell and experience the c...
by Random Walker
Fri Nov 02, 2018 11:35 pm
Forum: Investing - Theory, News & General
Topic: no dividends in index funds!
Replies: 95
Views: 9413

Re: no dividends in index funds!

Dividend policy is irrelevant to a stock’s total return I believe. Think there was a Nobel prize involved in that work. Dividends tend to be a not so great proxy for value stocks. The nice thing, I would think, about avoiding dividend stocks, is that one can decide when to sell and experience the c...
by Random Walker
Fri Nov 02, 2018 2:14 pm
Forum: Investing - Theory, News & General
Topic: Diversification Regret
Replies: 114
Views: 13496

Re: Diversification Regret

For me,the way to avoid “diversification regret” is to appreciate the relationship between past returns, current valuations, and future expected returns. When an asset class has done well, enjoy the past returns. When an asset class has done poorly and valuations are lower, look forward to increased...
by Random Walker
Fri Nov 02, 2018 9:30 am
Forum: Investing - Theory, News & General
Topic: Bonds vs CDs
Replies: 39
Views: 4433

Re: Bonds vs CDs

I have a high quality municipal bond ladder in taxable account through my advisor. At the shortest end of the ladder, about 1-3 years, they tend to use CDs instead of municipal bonds. CDs tend to have higher yields and are riskless since federally insured.

Dave
by Random Walker
Fri Nov 02, 2018 9:25 am
Forum: Investing - Theory, News & General
Topic: no dividends in index funds!
Replies: 95
Views: 9413

Re: no dividends in index funds!

Dividend policy is irrelevant to a stock’s total return I believe. Think there was a Nobel prize involved in that work. Dividends tend to be a not so great proxy for value stocks. The nice thing, I would think, about avoiding dividend stocks, is that one can decide when to sell and experience the ca...
by Random Walker
Fri Nov 02, 2018 8:34 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Impact Of Bias
Replies: 0
Views: 297

Larry Swedroe: Impact Of Bias

https://www.etf.com/sections/index-investor-corner/swedroe-impact-bias Larry reviews a paper centered on active managers repurchase of stocks they previously sold. They are more likely to repurchase stocks that made them profits than ones that resulted in losses. Their emotional bias results in wors...
by Random Walker
Wed Oct 31, 2018 6:41 pm
Forum: Investing - Theory, News & General
Topic: Is Small Value Still A Winner?
Replies: 96
Views: 7054

Re: Is Small Value Still A Winner?

I don't know if SCV will repeat it's returns in future years, but I've decided to tilt my portfolio to SCV significantly (40%). I was conflicted about choosing Small Cap Blended or Value, but in the end decided to stick with SCV. My reasoning is simply that if there is indeed a SCV premium I would ...
by Random Walker
Wed Oct 31, 2018 8:52 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Ignore Politics In Investing
Replies: 7
Views: 871

Larry Swedroe: Ignore Politics In Investing

https://www.etf.com/sections/index-investor-corner/swedroe-ignore-politics-investing Apparently us individual investors tend to let our political biases and the political climate affect our investing. This generally detracts from our results. Better to set a passive plan and stick to it independent ...
by Random Walker
Wed Oct 31, 2018 8:44 am
Forum: Investing - Theory, News & General
Topic: Swedroe: Look Beyond 60/40 Portfolio
Replies: 240
Views: 19906

Re: Swedroe: Look Beyond 60/40 Portfolio

Given the Behavior of the stock market this last month and low but rising interest rates, thought it would be a good time to give this thread a bump.

Dave
by Random Walker
Tue Oct 30, 2018 12:43 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: What Investors Should Worry About
Replies: 121
Views: 12546

Re: Larry Swedroe: What Investors Should Worry About

The ones I could put into PV didn't do any better than an intermediate term T bond etf. Are we missing something? Just that the expected return is significantly higher than intermediate term bonds. So yesterday we saw asset classes with equity like expected returns, behave very differently from equ...
by Random Walker
Tue Oct 30, 2018 11:55 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: What Investors Should Worry About
Replies: 121
Views: 12546

Re: Larry Swedroe: What Investors Should Worry About

Given the behavior of the stock market last few weeks, thought I’d give this thread a bump. Since initially started, Larry’s new edition of Black Swans has come out. The alternatives he discusses had a particularly good day yesterday when stocks took another hit.

Dave
by Random Walker
Mon Oct 29, 2018 3:08 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Opinion Shift On Hedge Funds
Replies: 0
Views: 396

Larry Swedroe: Opinion Shift On Hedge Funds

https://www.etf.com/sections/index-investor-corner/swedroe-opinion-shift-hedge-funds Larry reviews some statistics on the underperformance of hedge funds. Some hedge funds are closing down and returning capital to their investors. Some people are concerned that the trend towards passive investing is...
by Random Walker
Mon Oct 29, 2018 9:47 am
Forum: Investing - Theory, News & General
Topic: David Swensen Unconventional Success
Replies: 99
Views: 8873

Re: David Swensen Unconventional Success

Staythecourse,
I agree that we should also think both in terms of potential % loss and potential ABSOLUTE $ loss. That really helps clarify some AA issues.

Dave
by Random Walker
Mon Oct 29, 2018 9:20 am
Forum: Investing - Theory, News & General
Topic: David Swensen Unconventional Success
Replies: 99
Views: 8873

Re: David Swensen Unconventional Success

The bobcat did convince me to get a TIPS ladder and SPIA to cover my basic survival expense. Hope you bought him a beer. That was literally the best advice a retiree or soon to be one could ever get. Doesn't matter what happens to the rest of your $$$, but knowing you never need to worry about day ...
by Random Walker
Mon Oct 29, 2018 8:35 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Active Managers Fall Short In Emerging Markets
Replies: 2
Views: 319

Larry Swedroe: Active Managers Fall Short In Emerging Markets

https://www.etf.com/sections/index-investor-corner/swedroe-active-managers-fall-short-emerging-markets?nopaging=1 Some people believe that active management may still have a role in the supposedly “inefficient” markets. Larry blows this concept out of the water by looking at active versus passive in...
by Random Walker
Sun Oct 28, 2018 12:18 pm
Forum: Investing - Theory, News & General
Topic: Second thoughts about munis (wsj article)
Replies: 47
Views: 3961

Re: Second thoughts about munis (wsj article)

Tarkus, Agree, no free lunches. The higher yield of the fund compared to your ladder must reflect credit quality risk, duration risk, or some of both. The lower the average credit quality, the more bonds needed for adequate diversification. I’m sure the VG fund is well diversified; it’s necessary. L...
by Random Walker
Sun Oct 28, 2018 12:09 pm
Forum: Investing - Theory, News & General
Topic: Expanding on The Rewards Of Multiple Asset Class Investing
Replies: 51
Views: 6168

Re: Expanding on The Rewards Of Multiple Asset Class Investing

I agree, costs are critical! Moreover, costs are certain while the potential benefits are only probable. Obviously, I’ve decidied to prioritize portfolio efficiency over cost. I don’t think the issues regarding this are any different for accumulator v. Withdrawer. Volatility drag is an issue either ...
by Random Walker
Sun Oct 28, 2018 10:04 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Two Articles On Reinsurance
Replies: 56
Views: 5422

Re: Larry Swedroe: Two Articles On Reinsurance

Fortyforty, I’m inclined to agree with you way more than you might think. I strongly believe in efficient markets. But modern portfolio theory also makes great sense to me. I believe there is a huge difference between an efficient market and an efficient portfolio. Roger Gibson’s classic chart showi...
by Random Walker
Sun Oct 28, 2018 9:17 am
Forum: Investing - Theory, News & General
Topic: Second thoughts about munis (wsj article)
Replies: 47
Views: 3961

Re: Second thoughts about munis (wsj article)

This brings up a big potential advantage of a municipal bond ladder of individual bonds over a bond fund. With an individual bond ladder, one can control the bond quality and tailor the bonds to his own personal tax circumstance.

Dave
by Random Walker
Sun Oct 28, 2018 8:01 am
Forum: Investing - Theory, News & General
Topic: Second thoughts about munis (wsj article)
Replies: 47
Views: 3961

Re: Second thoughts about munis (wsj article)

From what I recall, highly rated munis have had an extremely low default rate, even in the worst of times. One can limit purchases to general obligations, essential service, and high rating.

Dave
by Random Walker
Sat Oct 27, 2018 9:00 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Two Articles On Reinsurance
Replies: 56
Views: 5422

Re: Larry Swedroe: Two Articles On Reinsurance

Daufuskienate, I totally agree. There are no free lunches, but that doesn’t mean that something new can’t come along that is an improvement for the individual investor. In making decisions, what matters is the expected returns of the alternatives relative to stocks and bonds. Expected returns on st...
by Random Walker
Sat Oct 27, 2018 2:18 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Two Articles On Reinsurance
Replies: 56
Views: 5422

Re: Larry Swedroe: Two Articles On Reinsurance

Daufuskienate, I totally agree. There are no free lunches, but that doesn’t mean that something new can’t come along that is an improvement for the individual investor. In making decisions, what matters is the expected returns of the alternatives relative to stocks and bonds. Expected returns on sto...
by Random Walker
Sat Oct 27, 2018 11:21 am
Forum: Investing - Theory, News & General
Topic: Beware of Interval Funds
Replies: 18
Views: 2667

Re: Beware of Interval Funds

Articpineapplecorp, The point of my post was simply that we can’t know everything. At some point we can learn enough about investing to distinguish a good advisor from a shark,( or a stupid selfish shark that knows less about investing than we do). And if we intelligently choose a good advisor that ...
by Random Walker
Sat Oct 27, 2018 9:29 am
Forum: Investing - Theory, News & General
Topic: Beware of Interval Funds
Replies: 18
Views: 2667

Re: Beware of Interval Funds

Never heard of these things but thought I'd share this with others so they avoid them. Entire article below: I’m heavily invested in three interval funds from Stone Ridge that have been discussed periodically here. Bill Bernstein has said that by the time one knows enough to distinguish and choose ...
by Random Walker
Fri Oct 26, 2018 7:43 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Alternative Approach To Alts
Replies: 45
Views: 5692

Re: Larry Swedroe: Alternative Approach To Alts

I just love it. First we had Alternative Investments. Now we have alternative Alternative Investments. Well said. That was the first thing I thought of when i read the title of the thread. Creative Investing! Not really creative, just incremental improvement. It’s generally more efficient to combin...
by Random Walker
Fri Oct 26, 2018 7:38 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Alternative Approach To Alts
Replies: 45
Views: 5692

Re: Larry Swedroe: Alternative Approach To Alts

Nedsaid, We agree on way more than we disagree. One of my core beliefs revolves around an imaginary efficient frontier. When I consider a new portfolio addition, I consider how I believe the new investment will mix with everything else in the portfolio, and whether it will likely push my portfolio a...
by Random Walker
Fri Oct 26, 2018 5:58 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Alternative Approach To Alts
Replies: 45
Views: 5692

Re: Larry Swedroe: Alternative Approach To Alts

Not throwing shade on Larry or Dave but I was wanting the comparison because folks need to be convinced that alternatives are better diversifiers than bonds. Otherwise we should just stick to bonds. Portfolio improvements are incremental. It’s not either/ or, the question is whether to create an al...
by Random Walker
Thu Oct 25, 2018 2:06 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Alternative Approach To Alts
Replies: 45
Views: 5692

Re: Larry Swedroe: Alternative Approach To Alts

Nedsaid, I agree, very important to have the bonds in the comparison since they are perhaps best and cheapest diversifier of equity risk. That’s why I also put a bond fund in the list. More to your point though, we need to appreciate that the alternatives have an equity like expected return, which i...
by Random Walker
Thu Oct 25, 2018 9:02 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Two Articles On Reinsurance
Replies: 56
Views: 5422

Re: Larry Swedroe: Two Articles On Reinsurance

I’m not Larry, but I think I have a couple of answers. First of all the reinsurance fund invests in a wide variety of diverse risks. Each individual risk has a big left tail, but the left tail riskmof the fund is greatly reduced by the diversification. Second, what matters is the left tail risk of t...
by Random Walker
Wed Oct 24, 2018 11:56 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Alternative Approach To Alts
Replies: 45
Views: 5692

Re: Larry Swedroe: Alternative Approach To Alts

I showed that above. DFMPX is DFA Municipal Bond Fund with average duration 3.25 years. It was down 0.1% over same period.

Dave
by Random Walker
Wed Oct 24, 2018 5:28 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Alternative Approach To Alts
Replies: 45
Views: 5692

Re: Larry Swedroe: Alternative Approach To Alts

Thought this would be an interesting time to look again at the alternatives. Market has been down pretty big over last few weeks and today was another sucky day. Thought I’d look at performances over last month: 9/24/18-10/24/18. Once again, a month is just noise in the data, but at least get a sens...
by Random Walker
Wed Oct 24, 2018 3:39 pm
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Why International Diversification Works
Replies: 119
Views: 9540

Re: Larry Swedroe: Why International Diversification Works

International small value is an especially good diversifier. International small is more subject to the separate local economies than International large, and size and value provide further uncorrelated factor diversification.

Dave
by Random Walker
Wed Oct 24, 2018 9:25 am
Forum: Investing - Theory, News & General
Topic: Changing to higher equities allocation during a major crash?
Replies: 26
Views: 2634

Re: Changing to higher equities allocation during a major crash?

I think we were all spoiled and somewhat deceived by 2007-2009. That was a rapid “V” shaped recovery for the stock markets. My quick look at an S&P 500 chart shows that the market returned to its previous 2008 peak within 4-5 years, 2012-2013. The recovery could have been much slower, protracted, an...
by Random Walker
Wed Oct 24, 2018 9:19 am
Forum: Investing - Theory, News & General
Topic: Larry Swedroe: Why International Diversification Works
Replies: 119
Views: 9540

Larry Swedroe: Why International Diversification Works

https://www.etf.com/sections/index-investor-corner/swedroe-why-intl-diversification-works?nopaging=1 Larry reviews a Mark Hulbert article that questions the benefits of international diversification, then reviews an Asness article that explains the benefits of international diversification. In short...
by Random Walker
Tue Oct 23, 2018 10:49 am
Forum: Investing - Theory, News & General
Topic: Jason Hsu and William Bernstein Like Overbalancing
Replies: 40
Views: 7791

Re: Jason Hsu and William Bernstein Like Overbalancing

Hi Bill, Thanks for chiming in! I think it’s a good time to mention your comments at the end of you Life Cycle Investing book. I’ve taken to heart Murphy’s Law of Retirement and your comments on sort of customizing one’s own glide path towards the retirement portfolio. A swollen portfolio results fr...
by Random Walker
Mon Oct 22, 2018 9:58 pm
Forum: Investing - Theory, News & General
Topic: "6 Reasons The Rich Should Pay-Off Their Mortgage"
Replies: 196
Views: 36835

Re: "6 Reasons The Rich Should Pay-Off Their Mortgage"

Reason 7, and IMHO the most important: If you pay it off, you may come out ahead financially or you may not. Only time (15 years? 30 years?) will tell. That's a crap shoot. But it feels so good to be debt-free. And no matter what, you have a roof over your head. Your home is really yours. Funny how...
by Random Walker
Mon Oct 22, 2018 9:56 pm
Forum: Investing - Theory, News & General
Topic: "Investing versus debt pay-off?"
Replies: 31
Views: 2008

Re: "Investing versus debt pay-off?"

I’ve found paying off the mortgage as soon as possible to be a great move. A big side effect for me is that I have found that it helps build the fortitude to stick to a more aggressive asset allocation. I agree. I think of paying down debt as the equivalent of investing in a bond fund. If the inter...
by Random Walker
Mon Oct 22, 2018 8:59 pm
Forum: Investing - Theory, News & General
Topic: What's Your Fixed Income Strategy?
Replies: 89
Views: 8780

Re: What's Your Fixed Income Strategy?

I’m 55 years old. My philosophy is that bonds are for safety: to dampen overall portfolio volatility to somewhat tolerable level. I take all my risk on the equity side. Therefore my bonds are all high quality and short to intermediate term. I use high grade municipal in a taxable account with avera...
by Random Walker
Mon Oct 22, 2018 5:55 pm
Forum: Investing - Theory, News & General
Topic: DFA small value... acitve management?
Replies: 103
Views: 6272

Re: DFA small value... acitve management?

Yes, but the index funds that track those indices are passively managed. The difference between that and what DFA does is that index fund managers do not control the index changes. I find this to be arbitrary. If DFA had an outside consultant make an "index rule" and then stuck to that - then it wo...
by Random Walker
Mon Oct 22, 2018 4:22 pm
Forum: Investing - Theory, News & General
Topic: "Investing versus debt pay-off?"
Replies: 31
Views: 2008

Re: "Investing versus debt pay-off?"

I’ve found paying off the mortgage as soon as possible to be a great move. A big side effect for me is that I have found that it helps build the fortitude to stick to a more aggressive asset allocation.

Dave
by Random Walker
Mon Oct 22, 2018 4:10 pm
Forum: Investing - Theory, News & General
Topic: What's Your Fixed Income Strategy?
Replies: 89
Views: 8780

Re: What's Your Fixed Income Strategy?

I’m 55 years old. My philosophy is that bonds are for safety: to dampen overall portfolio volatility to somewhat tolerable level. I take all my risk on the equity side. Therefore my bonds are all high quality and short to intermediate term. I use high grade municipal in a taxable account with averag...
by Random Walker
Mon Oct 22, 2018 10:12 am
Forum: Investing - Theory, News & General
Topic: DFA small value... acitve management?
Replies: 103
Views: 6272

Re: DFA small value... acitve management?

Packer, Don’t believe that SCV provides superior risk/reward relationship to TSM, just a different one. One of the big F-F findings is that size and value are independent unique factors from each other and from market factor. TSM investor is accessing one source of risk, market beta. SCV investor is...