Search found 7548 matches

by tadamsmar
Thu Dec 27, 2007 8:19 am
Forum: Investing - Theory, News & General
Topic: Efficient Market Theory
Replies: 93
Views: 16848

Drain demanded:
Define "risk".
1. Standard deviation.
2. A variable added to the math make SV performance consistent with the EMH.
by tadamsmar
Wed Dec 26, 2007 4:00 pm
Forum: Investing - Theory, News & General
Topic: Efficient Market Theory
Replies: 93
Views: 16848

http://www-personal.umich.edu/~kathrynd/JEP.EfficientMarketHypothesis.pdf Yep, that's Malkiel. He states his theory in a way that can't be verified or even necessarily agreed upon by all parties, makes hand-waving claims about what it implies, and then baselessly dismisses evidence presented by oth...
by tadamsmar
Wed Dec 26, 2007 3:26 pm
Forum: Investing - Theory, News & General
Topic: Did you make 2% real return for 2007?
Replies: 33
Views: 6717

Why all the concern about ST returns? We're all in this for the long term (at least I think we are). I don't have a clue what my returns were during the last 51 weeks, but since the S&P is up a bit, I suppose that I'm up also. I'm not really concerned. I have a spreadsheet for estimating the future...
by tadamsmar
Wed Dec 26, 2007 2:14 pm
Forum: Investing - Theory, News & General
Topic: Did you make 2% real return for 2007?
Replies: 33
Views: 6717

daryll40 wrote:I'm about where most of you are...my 60/40 portfolio is at 6.1% YTD gross return. Includes REITS which have finally come back to earth somewhat.
That's about a 2% real return. Most are saying they did better than that.

But not me.
by tadamsmar
Wed Dec 26, 2007 2:12 pm
Forum: Investing - Theory, News & General
Topic: Did you make 2% real return for 2007?
Replies: 33
Views: 6717

All the Vanguard Target Retirement funds made about 8% this year. https://personal.vanguard.com/us/funds/tools/benchmarkreturns So it didn't matter whether you were 100% stocks or 100% bonds, you should have made about 8% this year. :) Assume inflation is 4%, that's 4% real return. Yeah, Target Inc...
by tadamsmar
Wed Dec 26, 2007 12:58 pm
Forum: Investing - Theory, News & General
Topic: Did you make 2% real return for 2007?
Replies: 33
Views: 6717

All the Vanguard Target Retirement funds made about 8% this year. https://personal.vanguard.com/us/funds/tools/benchmarkreturns So it didn't matter whether you were 100% stocks or 100% bonds, you should have made about 8% this year. :) Assume inflation is 4%, that's 4% real return. Yeah, Target Inc...
by tadamsmar
Wed Dec 26, 2007 12:29 pm
Forum: Investing - Theory, News & General
Topic: Did you make 2% real return for 2007?
Replies: 33
Views: 6717

PlainJane wrote:
. Plus I have considerably less than 12.5% in RE.
I'm always a little confused when people talk about their allocations. Is this 12.5% of portfolio or 12.5% of your equities allocation?

Thanks!
12.5% of portfolio
by tadamsmar
Wed Dec 26, 2007 10:23 am
Forum: Investing - Theory, News & General
Topic: Did you make 2% real return for 2007?
Replies: 33
Views: 6717

Did you make 2% real return for 2007?

My crude estimate is that I made about 2% real return for 2007.

That's for a allocation similar to the Malkiel Life-Cycle model for a person in their late 50s. Similar to 50-50 stock-bond, except it has 12.5% REITS.

Gave a little back on the REIT index!
by tadamsmar
Wed Dec 26, 2007 8:56 am
Forum: Personal Finance (Not Investing)
Topic: U.S. Senate Report on Global Warming
Replies: 165
Views: 32351

Re: U.S. Senate Report on Global Warming

I was thinking about these issues and why they have relatively little impact on the negotiations. Here's the rub: Climate change causes climate change This is the most dangerous aspect of climate change. The cost and benefits of a warmer climate in NYC or similar considerations are relatively unimp...
by tadamsmar
Wed Dec 26, 2007 8:35 am
Forum: Personal Finance (Not Investing)
Topic: U.S. Senate Report on Global Warming
Replies: 165
Views: 32351

And that would take hundreds of years and there would be plenty of time to move NYC inland. Global warming is a challenge, not a catastrophe. There is some risk that it will be a catastrophe. We could release the frozen methane deposits under the oceans. The problem is that climate change causes mo...
by tadamsmar
Tue Dec 25, 2007 4:52 pm
Forum: Personal Finance (Not Investing)
Topic: U.S. Senate Report on Global Warming
Replies: 165
Views: 32351

Re: U.S. Senate Report on Global Warming

The argument over global warming is not focused properly. For instance, what happens when temperatures increase? What can we do about it? What would it cost? What will be the true balance scale for the world's ecology (including the human part) with rising temperatures, like for instance how many p...
by tadamsmar
Tue Dec 25, 2007 8:05 am
Forum: Personal Finance (Not Investing)
Topic: U.S. Senate Report on Global Warming
Replies: 165
Views: 32351

The argument over global warming is not focused properly. For instance, what happens when temperatures increase? What can we do about it? What would it cost? What will be the true balance scale for the world's ecology (including the human part) with rising temperatures, like for instance how many p...
by tadamsmar
Mon Dec 24, 2007 1:11 pm
Forum: Investing - Theory, News & General
Topic: Dr. Ed Yardeni's "Fed Model"
Replies: 57
Views: 15324

Makiel analysis: "I briefly review the success of past studies purporting to explain equity valuations and predict future equity returns. The Campbell-Shiller mean reversion models are contrasted with an expanded version of the so-called Federal Reserve model. At least from 1970 to 2003, Federal Res...
by tadamsmar
Mon Dec 24, 2007 1:00 pm
Forum: Investing - Theory, News & General
Topic: 2008 portfolio changes
Replies: 7
Views: 1943

I'm planning to totally abandon "Stay the Course" and start meandering around in circles :wink:
by tadamsmar
Mon Dec 24, 2007 9:08 am
Forum: Personal Finance (Not Investing)
Topic: U.S. Senate Report on Global Warming
Replies: 165
Views: 32351

Re: Which should I believe in?

1) SANTA, or 2) AGW H'mm, well at least I did get some presents signed "from santa" when I was younger. Seems to me that pretty much the entire AGW camp is strangly also that same group who believes in the adult version of the tooth fairy (big gov't adressing the smallest pimple of a problem, plann...
by tadamsmar
Mon Dec 24, 2007 8:16 am
Forum: Personal Finance (Not Investing)
Topic: U.S. Senate Report on Global Warming
Replies: 165
Views: 32351

Re: Which should I believe in?

1) SANTA, or 2) AGW H'mm, well at least I did get some presents signed "from santa" when I was younger. Seems to me that pretty much the entire AGW camp is strangly also that same group who believes in the adult version of the tooth fairy (big gov't adressing the smallest pimple of a problem, plann...
by tadamsmar
Mon Dec 24, 2007 8:02 am
Forum: Personal Finance (Not Investing)
Topic: U.S. Senate Report on Global Warming
Replies: 165
Views: 32351

Re: Which should I believe in?

1) SANTA, or 2) AGW H'mm, well at least I did get some presents signed "from santa" when I was younger. Seems to me that pretty much the entire AGW camp is strangly also that same group who believes in the adult version of the tooth fairy (big gov't adressing the smallest pimple of a problem, plann...
by tadamsmar
Fri Dec 21, 2007 7:56 pm
Forum: Personal Finance (Not Investing)
Topic: U.S. Senate Report on Global Warming
Replies: 165
Views: 32351

A foot or two by 2100 is the IPCC estimate. It is important to clarify that statement. The foot or two is only a single and the smallest component of the IPCC estimate and the easiest to accurately predict. This is the increase solely due to the thermal expansion of ocean water due to temperature i...
by tadamsmar
Fri Dec 21, 2007 2:47 pm
Forum: Personal Finance (Not Investing)
Topic: U.S. Senate Report on Global Warming
Replies: 165
Views: 32351

Move in land and accept that the seas will rise and cities and country's will need to adapt.. Look at a map of where the planet's populations live, and then think about that sentence. A United States without New York, Washington DC, Boston, Charleston, Miami, Mobile, Houston, big chunks of San Dieg...
by tadamsmar
Fri Dec 21, 2007 11:25 am
Forum: Personal Finance (Not Investing)
Topic: U.S. Senate Report on Global Warming
Replies: 165
Views: 32351

Senate report? really?

That so-called "Senate Report" is solely the product of a the ranking minority member of the Public Works Committee, Inhofe. He is far out on the denier end of the spectrum of opinion on global warming.

BTW, the moderators of this board use to prevent these political posts? What happened?
by tadamsmar
Tue Dec 18, 2007 11:17 am
Forum: Investing - Theory, News & General
Topic: Is Indexing the Best for REITs?
Replies: 25
Views: 5925

Re: Is Indexing the Best for REITs?

From the Morningstar analyst report for Vanguard's REIT Index (VGSIX) Active managers in this space have simply had better success rotating among industries and focusing on fundamental analysis. VGSIX is in bottom half of REIT peformance for 3, 5, and 10 yr returns (53, 64, 56% respectively). Is th...
by tadamsmar
Mon Dec 17, 2007 12:06 pm
Forum: Investing - Help with Personal Investments
Topic: How to Beat the Next Bubble
Replies: 36
Views: 6784

Re: I would vote for China

haban01 wrote:China's stock market is closed system, regulated and controlled by the government. :roll:
I heard a talk by Greenspan where he referred off-hand to the fact that investor are acting as if China stocks are invested in private property, but legally the private property does not exist.
by tadamsmar
Fri Dec 14, 2007 8:52 am
Forum: Investing - Help with Personal Investments
Topic: Decision to Shift to DIY using Index funds?
Replies: 12
Views: 2636

Re: Decision to Shift to DIY using Index funds?

I am retired, 65, and married. I have always used a finacial advisor to manage my portfolio. Now that I am retired I am concerned about the 5,000 a year I pay to my finacial advisor to invest in index funds. After reading the Bogelheads book I am thinking of switching to a DIY mode and eliminate th...
by tadamsmar
Fri Dec 14, 2007 8:42 am
Forum: Investing - Help with Personal Investments
Topic: Guilty of market timing?
Replies: 8
Views: 1969

Re: Guilty of market timing?

I have a decent sized retirement portfolio with the following allocation (all at Vanguard): 60/40 Equity-Fixed Income Equity: 50% Total Stock Market Index 10% REITs 30% Total Int'l Stock Index Fixed Income: 67% S-T Bond Index 33% TIPs Basically, I tried to model the equity portion using model portf...
by tadamsmar
Thu Dec 13, 2007 9:08 am
Forum: Investing - Theory, News & General
Topic: What Long-Term Stock Mkt Return are you expecting
Replies: 41
Views: 7585

financialengines.com does not require that you put in an assumption.

I think that's the way it should work.

But last I checked financialengines is not useful unless you are not real close to retirement since it only simulates the accumulation phase.
by tadamsmar
Wed Dec 12, 2007 11:36 am
Forum: Investing - Theory, News & General
Topic: What Long-Term Stock Mkt Return are you expecting
Replies: 41
Views: 7585

I have been using 2% real return for my retirement fund in my planning spreadsheet. The spreadsheet does a simple growth projection with no stochastics, so I use a conservative projection. I have also used financial engines.com. In figure if the plan works at 2% real, then I am doing OK. Actually 4%...
by tadamsmar
Tue Dec 04, 2007 2:32 pm
Forum: Investing - Theory, News & General
Topic: Bogle recommends being risk-adverse in 2008
Replies: 58
Views: 16338

In today's WSJ (12/3, pg R9), Bogle recommends being risk-adverse in 2008. "I would never tell anyone to get out of the stock market. You want to think of how your account is balanced. For example, if you normally want to be 75% stocks, I'd rather be 65% than 85% . I believe it's a good time to be ...
by tadamsmar
Tue Dec 04, 2007 1:22 pm
Forum: Investing - Theory, News & General
Topic: Bogle recommends being risk-adverse in 2008
Replies: 58
Views: 16338

"Don't blindly stay the course." Hmmm. Wonder who said that? I happen to agree that Jack Bogle has been far more consistent (and less doctrinaire) than some who take everything he says quite literally and in isolation from his overall approach. Here's a revealing interview with Sue Stevens from bac...
by tadamsmar
Tue Dec 04, 2007 1:08 pm
Forum: Investing - Theory, News & General
Topic: Bogle recommends being risk-adverse in 2008
Replies: 58
Views: 16338

Regardless of the label, it's the very same moving-money-around-to-avoid-losing-it approach that has received a consistent finger-wagging here. The problem with taking inflexible, doctrinaire approaches to things is that when unexpected conditions arise or--God forbid--you simply change your mind, ...
by tadamsmar
Tue Dec 04, 2007 1:02 pm
Forum: Investing - Theory, News & General
Topic: Bogle recommends being risk-adverse in 2008
Replies: 58
Views: 16338

Re: Bogle recommends being risk-adverse in 2008

In today's WSJ (12/3, pg R9), Bogle recommends being risk-adverse in 2008. "I would never tell anyone to get out of the stock market. You want to think of how your account is balanced. For example, if you normally want to be 75% stocks, I'd rather be 65% than 85%. I believe it's a good time to be c...
by tadamsmar
Tue Nov 13, 2007 3:44 pm
Forum: Investing - Theory, News & General
Topic: Buying the dips: neither good nor bad, it seems to me
Replies: 71
Views: 15929

It isn't accurate to have DCA at the end of the month be the normal strategy. If the money is available at any point during the month then you would invest it at the beginning. Which is why your "invest the first of the month" wins--investing earlier is better most of the time. BINGO! That is exact...
by tadamsmar
Tue Nov 13, 2007 8:44 am
Forum: Investing - Theory, News & General
Topic: How do you know you are in a bubble?
Replies: 34
Views: 6919

Re: How do you know you are in a bubble?

Greenspan was cracking jokes about being abled to predict 11 of the last 5 bubbles. Those jokes are pretty funny! Shiller has made a good career as a bubble oracle. He use the broken clock method. Not so good at predicting bubbles, but it seems to fool the press. I don't get this. Didn't Shiller co...
by tadamsmar
Mon Nov 12, 2007 4:41 pm
Forum: Investing - Theory, News & General
Topic: How do you know you are in a bubble?
Replies: 34
Views: 6919

Re: How do you know you are in a bubble?

What kind of P/E ratio would indicate a bubble? A market cap index fund will be affected by a bubble by design. So, would it make sense to monitor the P/E ratio for signs of a bubble and sell if needed? In another thread it was pointed out that if you split your foreign equities up into europe, pac...
by tadamsmar
Mon Nov 12, 2007 10:52 am
Forum: Investing - Theory, News & General
Topic: Buying the dips: neither good nor bad, it seems to me
Replies: 71
Views: 15929

By fees do you mean cost to trade? I DCA, and typically buy only on big down days, if not always. About 2 months back when I was curious to see how it was playing out vs lump sum investing, and investing at the same time every month, I came out with roughly a 4% return over lump sum, and 1.75% over...
by tadamsmar
Mon Nov 12, 2007 10:25 am
Forum: Investing - Theory, News & General
Topic: Buying the dips: neither good nor bad, it seems to me
Replies: 71
Views: 15929

I thinking buying on dips is not like flipping a coin. The reason is that when you buy on a dip, you already know what the outcome of the coin flip was. To expound on this some more. If you are going to invest every month, you can have a simple rule: Invest on a day when the market is down by 1.5% ...
by tadamsmar
Mon Nov 12, 2007 9:31 am
Forum: Investing - Theory, News & General
Topic: Benjamin Grahman on MPT
Replies: 12
Views: 2085

Graham is quoted as saying: 'To me [the efficient-market theory] is not a very encouraging conclusion because if I have noticed anything over these 60 years on Wall Street, it is that people do not succeed in forecasting what's going to happen to the stock market.' But, the EMT does not imply that p...
by tadamsmar
Sun Nov 11, 2007 8:36 am
Forum: Investing - Theory, News & General
Topic: Time to rename this forum
Replies: 32
Views: 6539

Re: I agree

Have you read "Fortune's Formula"? Yes, I really enjoyed this book. I don't recall any mention of the Shewhart Charts. The Wikipedia entry makes it clear how they would be relevant to evaluating a trading strategy. I've often wondered how traders decide to abandon a particular strategy. The basic i...
by tadamsmar
Fri Nov 09, 2007 3:34 pm
Forum: Investing - Theory, News & General
Topic: An idea for visualizing the impact of rebalancing
Replies: 12
Views: 2376

One problem with EF calculations is that they are backward looking and are very dependent on the time period looked at. An investor calculating the EF today based on data going back to 1929 will get very different results than someone doing the same calculation in 1998, or 1970, etc. It tells you w...
by tadamsmar
Fri Nov 09, 2007 3:16 pm
Forum: Investing - Theory, News & General
Topic: An idea for visualizing the impact of rebalancing
Replies: 12
Views: 2376

One problem with EF calculations is that they are backward looking and are very dependent on the time period looked at. An investor calculating the EF today based on data going back to 1929 will get very different results than someone doing the same calculation in 1998, or 1970, etc. It tells you w...
by tadamsmar
Fri Nov 09, 2007 1:44 pm
Forum: Investing - Theory, News & General
Topic: Time to rename this forum
Replies: 32
Views: 6539

Momemtum

Ah, Momentum. Yet another idea posted here that, if true, could be used to build the biggest investment firm in world in a matter of years. Malkiel says that momentum is so small to be unexploitable because of transaction costs. But, if you can avoid all costs, I guess there might be a tiny bit of m...
by tadamsmar
Fri Nov 09, 2007 12:44 pm
Forum: Investing - Theory, News & General
Topic: An idea for visualizing the impact of rebalancing
Replies: 12
Views: 2376

But maybe more to the point, I don't think anyone really has a very precise and accurate notion of where the EF really is - it depends on too many squishy notions like risk, and worse, any calculation of the EF supposes the one risk and reward path we experienced is a good estimate of the true prob...
by tadamsmar
Fri Nov 09, 2007 12:38 pm
Forum: Investing - Theory, News & General
Topic: An idea for visualizing the impact of rebalancing
Replies: 12
Views: 2376

Why would rebalancing get you closer to the efficient frontier? The efficient frontier is simply holding some combination of riskless assets and the market portfolio. Well, look here: http://en.wikipedia.org/wiki/Image:Markowitz_frontier.jpg In the extreme case, if your portfolio get sufficiently u...
by tadamsmar
Fri Nov 09, 2007 9:39 am
Forum: Investing - Theory, News & General
Topic: Time to rename this forum
Replies: 32
Views: 6539

Bill Bernstein gave some great advice on the Brill's site back in 1995 regarding timing: It can't be said often enough: There are only two kinds of investors, those who can't predict market trends and those who don't know that they can't. The market is an 800 pound gorilla, and it's not a good idea...
by tadamsmar
Fri Nov 09, 2007 8:28 am
Forum: Investing - Theory, News & General
Topic: Time to rename this forum
Replies: 32
Views: 6539

Re: I agree

Hi LH, Yes, I agree that stating the market yields "imperfect predictions" is not a controversial belief in itself. I should've said I actually look for exploitable inefficiencies, and have traded based on "less imperfect predictions" using high-frequency strategies that generate alpha significant ...
by tadamsmar
Thu Nov 08, 2007 9:08 pm
Forum: Investing - Theory, News & General
Topic: An idea for visualizing the impact of rebalancing
Replies: 12
Views: 2376

Seems to me rebalanced or not your AA is going to move all over relative to the EF as the EF itself moves around. Indeed it is entirely possible that at a given time rebalancing will move you away from the efficient frontier. Not to mention the possibility of moving sideways to the EF. Sideways wou...
by tadamsmar
Thu Nov 08, 2007 4:29 pm
Forum: Investing - Theory, News & General
Topic: An idea for visualizing the impact of rebalancing
Replies: 12
Views: 2376

An idea for visualizing the impact of rebalancing

In my view rebalancing does two things: 1. Brings your risk back to where you want to be 2. Gets your allocation back to the efficient frontier It would be interesting to see an animation of an asset allocation moving around in risk/return space over time, relative to the efficient frontier. Then si...
by tadamsmar
Thu Nov 08, 2007 4:15 pm
Forum: Investing - Theory, News & General
Topic: Time to rename this forum
Replies: 32
Views: 6539

Re: Time to rename this forum

ddb wrote:[Personally, I'm glad for the various threads. You can only read about somebody diversifying and rebalancing so much before it starts to get kind of boring :)

- DDB
True, watching paint dry is a bit less interesting than watching paint run.
by tadamsmar
Thu Nov 08, 2007 4:03 pm
Forum: Investing - Theory, News & General
Topic: Time to rename this forum
Replies: 32
Views: 6539

Re: I agree

(1) Still in accumulation, so a panic would probably help them make money. The theory that volatility or market crashes are good things for investors in the accumulation phase (i.e. those who dollar-cost average) is a common sentiment here, but in truth, the theory isn't fully developed. In reality...
by tadamsmar
Thu Nov 08, 2007 3:57 pm
Forum: Personal Finance (Not Investing)
Topic: Any Bourbon drinkers here?
Replies: 33
Views: 8647

Re: Any Bourbon drinkers here?

Other than wine, my alcohol intake during the past two years or so has been confined mostly to bourbon. Interested to hear from those who are bourbon fans what bottles you find particularly enjoyable. My wife recently purchased me a bottle of Pappy Van Winkles 20 Year Family Reserve for our anniver...
by tadamsmar
Thu Nov 08, 2007 3:49 pm
Forum: Investing - Theory, News & General
Topic: Time to rename this forum
Replies: 32
Views: 6539

Re: I agree

What motivates people to think that their "insight" is better than the millions of other people purchasing securities in the US and global markets? Fear of losing money. Most likely, any true diehards with such fear are: (1) Still in accumulation, so a panic would probably help them make money. (2)...