Investors Were Warned.

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lostdog
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Re: Investors Were Warned.

Post by lostdog »

Jack Bogle said "Buy the haystack". What did he mean? U.S. only? If so, he's tilting.

VT/VTWAX (World market cap) should be the null starting point. Anything after that is a tilt.
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vineviz
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Re: Investors Were Warned.

Post by vineviz »

:greedy
rkhusky wrote: Tue Sep 01, 2020 9:36 am
burritoLover wrote: Tue Sep 01, 2020 9:31 am
rkhusky wrote: Tue Sep 01, 2020 8:57 am
burritoLover wrote: Tue Sep 01, 2020 8:32 am The difference is the U.S. tilt on this forum is framed as a matter of "personal preference", while anything like small cap value is framed as reckless and stupid.
No. It is the idea that small value is guaranteed to outperform the market that is foolish. Same as the idea that the US is guaranteed to outperform the global market. (Also the idea that either has a higher probability of outperforming)

Both are preferences that one needs to stick with long term in order to achieve any premium, if a premium happens to show up.
No one is saying anything is guaranteed with small cap, value or other factors.
I've seen posts where it seems otherwise. Perhaps they are naive investors that think SCV investing is the path to beating the market.
Maybe you could link to an example?
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch
tibbitts
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Re: Investors Were Warned.

Post by tibbitts »

austin757 wrote: Mon Aug 31, 2020 7:07 pm On a related note, I have been considering selling my Small-Cap fund (VB) and buying TSM instead. My reasoning is simplicity, but I'm not all that convinced about it outperforming TSM. I only have a slight capital gain on it and it would be small tax bill. Decisions, decisions...
What has changed that makes you believe small value is less likely to meet your requirements now vs. when you bought it? You knew when you invested in it that it was a bet that might not pay off during your lifetime, so how has it not met your expectations?
EnjoyIt
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Re: Investors Were Warned.

Post by EnjoyIt »

This again.

Small value appears to have more risk and may or may not give higher returns. These higher returns can happen next week, next year, next decade or never. I'm going to stick with "no one knows nothing."

Disclaimer: I do not tilt small value, but I also don't judge those who do.
A time to EVALUATE your jitters: | https://www.bogleheads.org/forum/viewtopic.php?f=10&t=79939&start=400#p5275418
whereskyle
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Re: Investors Were Warned.

Post by whereskyle »

Whakamole wrote: Tue Sep 01, 2020 8:46 am
whereskyle wrote: Tue Sep 01, 2020 6:29 am The advice to buy and hold a single total-market fund is the single best piece of investing advice one can possibly give and one can possibly receive.

Period.
So... VTSAX? No internationally-traded companies? Vanguard recommends international weighted to market capitalization; Taylor has (at times) said 20% because of two quotes.

Or do you mean VTWAX? That includes international stocks, but at a higher level than Taylor has recommended with his two quotes. But it also has no bonds...
It really doesn't matter. Of course there are plenty of things to add to the list as time goes on, but for starters, quite inoffensive advice is buy VTSAX or VTWAX, and there you go, you have everything you need to build wealth reliably. We are all amateurs. If you want to complicate this obvious simplicity for the sake of gags or intellectual points, go ahead. It doesn't make it worthwhile input.

We should all concede that straying from the market increases behavioral risk that can drag returns down if a novice starts hopping from fund to fund.

Taylor's advice is sound. Trying to pick winners increases risk, and a total market fund is all you need. Even if you or others might be able to capture the premium, it is still risky and frankly unnecessary.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle
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Taylor Larimore
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Correction

Post by Taylor Larimore »

burritoLover wrote: Mon Aug 31, 2020 4:01 pm Wow, Taylor is promoting large cap growth stocks now.
burritoLover:

I have never promoted the "large cap growth stocks" sector.

On the other hand, I try to be helpful by promoting "Investing Advice Inspired by Jack Bogle" (read the headline at the top of this page).

Best wishes:
Taylor
Jack Bogle's Words of Wisdom: "Total market indexing is the gold standard. Anything else, like sector investing, is a dilution of that standard."
"Simplicity is the master key to financial success." -- Jack Bogle
burritoLover
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Re: Correction

Post by burritoLover »

Taylor Larimore wrote: Tue Sep 01, 2020 10:59 am
burritoLover wrote: Mon Aug 31, 2020 4:01 pm Wow, Taylor is promoting large cap growth stocks now.
burritoLover:

I have never promoted the "large cap growth stocks" sector.

On the other hand, I try to be helpful by promoting "Investing Advice Inspired by Jack Bogle" (read the headline at the top of this page).

Best wishes:
Taylor
Jack Bogle's Words of Wisdom: "Total market indexing is the gold standard. Anything else, like sector investing, is a dilution of that standard."
I was being facetious since your "warnings" were primarily focused at small cap and value.
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protagonist
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Re: Investors Were Warned.

Post by protagonist »

XacTactX wrote: Tue Sep 01, 2020 1:29 am
MostlyABogleHead wrote: Tue Sep 01, 2020 12:22 am I had a related question. Are there any material to understand the value premium and why it exists in a more understandable form? And more importantly why does it exist now even after this is well known for a long time now (ie., why has this not priced in the cost of the funds and hence raising the cost of these stocks?)
The most thorough and accessible source I've found is Your Complete Guide to Factor-Based Investing by Larry Swedroe and Andrew Berkin. They have a chapter for value and they talk about risk-based explanations (value stocks have more unstable earnings, more fixed assets that can't be scaled down in bad times, and more debt) and behavior-based explanations (growth stocks are popular, people bid the prices up because they think sales and earnings will grow at an unrealistic rate, stock analysts do the same thing). The value premium should continue because of the risk-based explanations, but the behavior-based explanations can disappear if enough people realize there is a pricing error.

Here's a link to the book, it's one of my favorites. Your Complete Guide to Factor-Based Investing.
I'm no expert, but ultimately the main factors that seem to me to drive the market are:
1. Fear. That would seem to me to favor more stable, well-known companies.
2. Greed. That would seem to me to favor riskier assets that provide the investor with glimmers of massive wealth.
3. Expectations. Who knows what those are going to be at any given time in the future? For the individual investor they are heavily manipulated by the media , as well as by brokers and financial advisors. And expectations are also constantly fluctuating based on the ratio between fear and greed, which is constantly changing.
4. The major world events that are unpredictable and unknowable in advance.

In other words, other than the important events that are unpredictable (#4 above), the market is driven by mostly behavioral factors that are in constant flux , related to the immediate and changing ratio of fear/greed, and also virtually unpredictable for any significant amount of time going forward as both global realities and their interpretation by talking heads change. Whatever "signal" might actually be present is rapidly drowned out by all the noise. And the books that find justification for "signal" by looking backwards and fitting an explanation to why something happened in the recent past and why it should happen in the future are just financial porn. If that "signal" was (and, extrapolating, is and will be) predictable beforehand, getting incredibly rich would be a piece of cake.

The only things that , offhand, seem to be nearly universal to me are:
1. Risk is proportionate to potential reward (though risk is also difficult to estimate accurately in finance)
2. The more you spend, the less money you wind up with, which is why it makes sense to limit management fees and the like (and to live within your means).
3. The more you earn or save, the more money you wind up with, and savings compound.
4. The more you borrow, the more you have to ultimately spend, which is why it is usually important to stay out of debt.

Beyond that, some theories may have validity, but none to date could be validated experimentally, most have conflicting theories that may also have validity, they are all impossible to test with good scientific method, many are non-falsifiable and thus effectively untestable, more fail than succeed, and if one works for you over a given short period of time (yes, multiple decades are short periods of time related to how much data is available), you will never know if your theory was a good one or if you were just lucky.

If I had a small cap value tilt, based on my belief in Swedroe's "evidence" and explanations for it (or whatever), I would be questioning the wisdom of that decision given recent performance and questioning whether I should "stay the course" or shift, which would cause worry, stress, and probably result in a lot more time following performance. I've been there....I tried all kinds of "theories" with internally consistent logic and superior past performance when I started investing roughly 30-35 years ago including some of my own. That is why, in a nutshell, I choose to just invest broadly , save on management fees, and let the chips fall as they may. I don't know if it is the best strategy or if tilting works, but I have not heard any convincing arguments that tilting will work in the future (or that any other method is really better), and there is no way to reliably test it, so I choose to make my life easy by keeping it simple.

(ps....another shout out for Taylor Larrimore. A very smart man with a level head on his shoulders, and a generous heart when it comes to helping others. Essentially he is the opposite of a "troll", and is always worth listening to, whether or not you agree with him. I have been listening to him for the past decade and I can't think of ever receiving any bad advice from him.)
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Kenkat
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Re: Investors Were Warned.

Post by Kenkat »

I’m thinking some of the angst here is over the wording of “you were warned” and an “(expensive) lesson (was) learned”.

So two reactions to that:

1) If you wanted to fire up the non-Total Market folks, this was effective - well done
2) Ok, that’s a fair position to take but I don’t agree, so thanks but no thanks for the warning and we will see on the lesson part some years from now - you might be right, but you might not
Whakamole
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Re: Investors Were Warned.

Post by Whakamole »

whereskyle wrote: Tue Sep 01, 2020 10:47 am
Whakamole wrote: Tue Sep 01, 2020 8:46 am
whereskyle wrote: Tue Sep 01, 2020 6:29 am The advice to buy and hold a single total-market fund is the single best piece of investing advice one can possibly give and one can possibly receive.

Period.
So... VTSAX? No internationally-traded companies? Vanguard recommends international weighted to market capitalization; Taylor has (at times) said 20% because of two quotes.

Or do you mean VTWAX? That includes international stocks, but at a higher level than Taylor has recommended with his two quotes. But it also has no bonds...
It really doesn't matter. Of course there are plenty of things to add to the list as time goes on, but for starters, quite inoffensive advice is buy VTSAX or VTWAX, and there you go, you have everything you need to build wealth reliably. We are all amateurs. If you want to complicate this obvious simplicity for the sake of gags or intellectual points, go ahead. It doesn't make it worthwhile input.

We should all concede that straying from the market increases behavioral risk that can drag returns down if a novice starts hopping from fund to fund.

Taylor's advice is sound. Trying to pick winners increases risk, and a total market fund is all you need. Even if you or others might be able to capture the premium, it is still risky and frankly unnecessary.
Taylor is a proponent of the three-fund portfolio. When has he ever said a total market fund is all you need?
XacTactX
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Re: Investors Were Warned.

Post by XacTactX »

protagonist wrote: Tue Sep 01, 2020 11:12 am
XacTactX wrote: Tue Sep 01, 2020 1:29 am
MostlyABogleHead wrote: Tue Sep 01, 2020 12:22 am I had a related question. Are there any material to understand the value premium and why it exists in a more understandable form? And more importantly why does it exist now even after this is well known for a long time now (ie., why has this not priced in the cost of the funds and hence raising the cost of these stocks?)
The most thorough and accessible source I've found is Your Complete Guide to Factor-Based Investing by Larry Swedroe and Andrew Berkin. They have a chapter for value and they talk about risk-based explanations (value stocks have more unstable earnings, more fixed assets that can't be scaled down in bad times, and more debt) and behavior-based explanations (growth stocks are popular, people bid the prices up because they think sales and earnings will grow at an unrealistic rate, stock analysts do the same thing). The value premium should continue because of the risk-based explanations, but the behavior-based explanations can disappear if enough people realize there is a pricing error.

Here's a link to the book, it's one of my favorites. Your Complete Guide to Factor-Based Investing.
I'm no expert, but ultimately the main factors that seem to me to drive the market are:
1. Fear. That would seem to me to favor more stable, well-known companies.
2. Greed. That would seem to me to favor riskier assets that provide the investor with glimmers of massive wealth.
3. Expectations. Who knows what those are going to be at any given time in the future? For the individual investor they are heavily manipulated by the media , as well as by brokers and financial advisors. And expectations are also constantly fluctuating based on the ratio between fear and greed, which is constantly changing.
4. The major world events that are unpredictable and unknowable in advance.

[The rest of the post is snipped to save space]
They cited three studies to explain the risk and behavior-based explanations for the value premium. I can link them if it helps at all

Chen, Nai-fu, and Feng Zhang, Risk and Return of Value Stocks. October 1998. PDF Link Here
Zhang, Lu. The Value Premium. December 2002. SSRN Link Here
Peterkort, Robert F, and James F. Nielsen. Is the Book-to-Market Ratio a Measure of Risk? October 2005. Abstract Here (no full text)

EDIT: I was wrong they actually cited 6-7 studies in this part of the book, if anyone wants more I would recommend renting a copy from the library, it's a fantastic book
Last edited by XacTactX on Tue Sep 01, 2020 1:11 pm, edited 1 time in total.
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Robot Monster
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Re: Investors Were Warned.

Post by Robot Monster »

Remember the killer rabbit scene in Monty Python and the Holy Grail? "I warned you, but did you listen to me? Oh, no, you knew it all, didn't you? Oh, it's just a harmless little bunny, isn't it? Well, it's always the same. I always tell them--"
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hilink73
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Re: Investors Were Warned.

Post by hilink73 »

Robot Monster wrote: Mon Aug 31, 2020 6:12 pm
I would like to officially cast a new warning into the wind...

"If you continue investing in Total Stock, you will endure much pain, and shed many tears, watching QQQ outperform."

You have now been warned.
No, you're wrong.

If you continue investing in plain boring stock market mutual funds, you will endure much pain, and shed many tears, watching my 3 x leveraged ETFs outperfom.

Now you have been warned.
Robot Monster
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Re: Investors Were Warned.

Post by Robot Monster »

hilink73 wrote: Tue Sep 01, 2020 1:11 pm
Robot Monster wrote: Mon Aug 31, 2020 6:12 pm
I would like to officially cast a new warning into the wind...

"If you continue investing in Total Stock, you will endure much pain, and shed many tears, watching QQQ outperform."

You have now been warned.
No, you're wrong.

If you continue investing in plain boring stock market mutual funds, you will endure much pain, and shed many tears, watching my 3 x leveraged ETFs outperfom.

Now you have been warned.
Oh. Snap.
"Happiness comes from being connected in the right ways to: other people, your work, something larger than yourself."
hilink73
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Re: Investors Were Warned.

Post by hilink73 »

Robot Monster wrote: Tue Sep 01, 2020 1:12 pm
hilink73 wrote: Tue Sep 01, 2020 1:11 pm
Robot Monster wrote: Mon Aug 31, 2020 6:12 pm
I would like to officially cast a new warning into the wind...

"If you continue investing in Total Stock, you will endure much pain, and shed many tears, watching QQQ outperform."

You have now been warned.
No, you're wrong.

If you continue investing in plain boring stock market mutual funds, you will endure much pain, and shed many tears, watching my 3 x leveraged ETFs outperfom.

Now you have been warned.
Oh. Snap.
See.
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Re: Investors Were Warned.

Post by mrspock »

burritoLover wrote: Tue Sep 01, 2020 6:30 am You are ignoring evidence-based peer-reviewed research because it just doesn't make sense to you? Have you actually read the research? If so, what specifically are you refuting and what evidence-based reason are you doing so?
Finance is not Physics nor is it science, so while peer reviewed research may work well in those subject domains, the conclusions which are drawn in finance are far less certain due to the nature of finance (i.e. randomness/chaotic nature of the systems which they study). Simply put, the weight one should give to peer reviewed research in the areas of medicine, physics or engineering is far (far) higher than what is suitable in the realm of finance.

Even in the books I've read on tilting, they almost always qualify their conclusions by saying it's anything but certain, but more their best guess based on the best information. In other words they could very well be wrong.

Again, feel free to small cap tilt, but the track record of this strategy to date is pretty dubious. As for evidence, there's this thing called "Google", I'd encourage you to use it. Those answers are at your finger tips if you choose to seek them.
EddyB
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Re: Investors Were Warned.

Post by EddyB »

whereskyle wrote: Tue Sep 01, 2020 6:29 am Just amazing to me how many tilters are upset that Taylor is recommending yet again a simple total-market portfolio.

Dear tilters,

The advice to buy and hold a single total-market fund is the single best piece of investing advice one can possibly give and one can possibly receive.

Period.

You may tilt all you like, but please do not pretend that advising people to tilt in any direction, with all the behavioral risks involved, is better than advising them to simply buy and hold the market. Absolutely not. Tilting is a game you can play for yourself, with experience, and with appropriate appreciation for the risks involved. But tilting is idiosyncratic, should remain as such, and is poor default advice for new investors.

Buying the market and holding it, however, is indispituably good advice for virtually every investor. Just ask Fama and French.

Please don't bash Taylor for criticizing tilters and advising people to hold the market. Such bashing to me is simply disingenuous, even if you tilt.
Except tilting toward the US, which gets a pass.
burritoLover
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Re: Investors Were Warned.

Post by burritoLover »

mrspock wrote: Tue Sep 01, 2020 1:22 pm
burritoLover wrote: Tue Sep 01, 2020 6:30 am You are ignoring evidence-based peer-reviewed research because it just doesn't make sense to you? Have you actually read the research? If so, what specifically are you refuting and what evidence-based reason are you doing so?
Finance is not Physics nor is it science, so while peer reviewed research may work well in those subject domains, the conclusions which are drawn in finance are far less certain due to the nature of finance (i.e. randomness/chaotic nature of the systems which they study). Simply put, the weight one should give to peer reviewed research in the areas of medicine, physics or engineering is far (far) higher than what is suitable in the realm of finance.
I totally agree. So the alternative is we'll just consult our gut instinct as to whether or not a given investing strategy seems sound - how it makes us feel. Stocks outperforming bonds in the long term is just a theory. It was not always widely accepted that this was the case until research was done to show that possibility.
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Robot Monster
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Re: Investors Were Warned.

Post by Robot Monster »

burritoLover wrote: Tue Sep 01, 2020 1:45 pm
mrspock wrote: Tue Sep 01, 2020 1:22 pm
burritoLover wrote: Tue Sep 01, 2020 6:30 am You are ignoring evidence-based peer-reviewed research because it just doesn't make sense to you? Have you actually read the research? If so, what specifically are you refuting and what evidence-based reason are you doing so?
Finance is not Physics nor is it science, so while peer reviewed research may work well in those subject domains, the conclusions which are drawn in finance are far less certain due to the nature of finance (i.e. randomness/chaotic nature of the systems which they study). Simply put, the weight one should give to peer reviewed research in the areas of medicine, physics or engineering is far (far) higher than what is suitable in the realm of finance.
I totally agree. So the alternative is we'll just consult our gut instinct as to whether or not a given investing strategy seems sound - how it makes us feel. Stocks outperforming bonds in the long term is just a theory. It was not always widely accepted that this was the case until research was done to show that possibility.
You should unleash your arsenal of burritos before Spock goes shields-up.
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vineviz
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Re: Investors Were Warned.

Post by vineviz »

mrspock wrote: Tue Sep 01, 2020 1:22 pm Finance is not Physics nor is it science, so while peer reviewed research may work well in those subject domains, the conclusions which are drawn in finance are far less certain due to the nature of finance (i.e. randomness/chaotic nature of the systems which they study). Simply put, the weight one should give to peer reviewed research in the areas of medicine, physics or engineering is far (far) higher than what is suitable in the realm of finance.
This line of argument reminds me a lot of the way that climate change denialist refer to climate research.

It’s true that economics is not a physical science, but it IS a science. It is a field of study capable of creating falsifiable hypotheses.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch
burritoLover
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Re: Investors Were Warned.

Post by burritoLover »

Robot Monster wrote: Tue Sep 01, 2020 1:51 pm
burritoLover wrote: Tue Sep 01, 2020 1:45 pm
mrspock wrote: Tue Sep 01, 2020 1:22 pm
burritoLover wrote: Tue Sep 01, 2020 6:30 am You are ignoring evidence-based peer-reviewed research because it just doesn't make sense to you? Have you actually read the research? If so, what specifically are you refuting and what evidence-based reason are you doing so?
Finance is not Physics nor is it science, so while peer reviewed research may work well in those subject domains, the conclusions which are drawn in finance are far less certain due to the nature of finance (i.e. randomness/chaotic nature of the systems which they study). Simply put, the weight one should give to peer reviewed research in the areas of medicine, physics or engineering is far (far) higher than what is suitable in the realm of finance.
I totally agree. So the alternative is we'll just consult our gut instinct as to whether or not a given investing strategy seems sound - how it makes us feel. Stocks outperforming bonds in the long term is just a theory. It was not always widely accepted that this was the case until research was done to show that possibility.
You should unleash your arsenal of burritos before Spock goes shields-up.
totally
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Re: Investors Were Warned.

Post by mrspock »

vineviz wrote: Tue Sep 01, 2020 1:51 pm
mrspock wrote: Tue Sep 01, 2020 1:22 pm Finance is not Physics nor is it science, so while peer reviewed research may work well in those subject domains, the conclusions which are drawn in finance are far less certain due to the nature of finance (i.e. randomness/chaotic nature of the systems which they study). Simply put, the weight one should give to peer reviewed research in the areas of medicine, physics or engineering is far (far) higher than what is suitable in the realm of finance.
This line of argument reminds me a lot of the way that climate change denialist refer to climate research.

It’s true that economics is not a physical science, but it IS a science. It is a field of study capable of creating falsifiable hypotheses.
Oh boy... was I just called a “small cap value denier”?! :)

I think you need to Google “False Equivalence”. My argument can “remind” you of Santa Claus, but assure that doesn’t make it similar. Climate Science is — science. Finance ... last I checked the building it was located in my local University, is not.
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Re: Investors Were Warned.

Post by Robot Monster »

mrspock wrote: Tue Sep 01, 2020 2:06 pm
vineviz wrote: Tue Sep 01, 2020 1:51 pm
mrspock wrote: Tue Sep 01, 2020 1:22 pm Finance is not Physics nor is it science, so while peer reviewed research may work well in those subject domains, the conclusions which are drawn in finance are far less certain due to the nature of finance (i.e. randomness/chaotic nature of the systems which they study). Simply put, the weight one should give to peer reviewed research in the areas of medicine, physics or engineering is far (far) higher than what is suitable in the realm of finance.
This line of argument reminds me a lot of the way that climate change denialist refer to climate research.

It’s true that economics is not a physical science, but it IS a science. It is a field of study capable of creating falsifiable hypotheses.
Oh boy... was I just called a “small cap value denier”?! :)

I think you need to Google “False Equivalence”. My argument can “remind” you of Santa Claus, but assure that doesn’t make it similar. Climate Science is — science. Finance ... last I checked the building it was located in my local University, is not.
This is the most entertaining gladiator fight amongst professors I've seen in a while.
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vineviz
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Re: Investors Were Warned.

Post by vineviz »

mrspock wrote: Tue Sep 01, 2020 2:06 pm Oh boy... was I just called a “small cap value denier”?! :)
Anti-intellectualism takes many forms.
mrspock wrote: Tue Sep 01, 2020 2:06 pm I think you need to Google “False Equivalence”. My argument can “remind” you of Santa Claus, but assure that doesn’t make it similar. Climate Science is — science. Finance ... last I checked the building it was located in my local University, is not.
Is it possible that a “local University” is not the grand arbiter of all knowledge?

What Is Economics?
Economics is the scientific study of the ownership, use, and exchange of scarce resources – often shortened to the science of scarcity. Economics is regarded as a social science because it uses scientific methods to build theories that can help explain the behaviour of individuals, groups and organisations. Economics attempts to explain economic behaviour, which arises when scarce resources are exchanged.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch
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Re: Investors Were Warned.

Post by bluquark »

Kenkat wrote: Tue Sep 01, 2020 11:30 am 2) Ok, that’s a fair position to take but I don’t agree, so thanks but no thanks for the warning and we will see on the lesson part some years from now - you might be right, but you might not
Personally as a middle-aged Total World style portfolio holder, I've come to accept that people of my generation who have been tilting growth or US over the last 10-15 years have probably outperformed me for life. It was a ridiculously strong bull run and it would take a truly dramatic reversal over the next decades for a balanced portfolio to overcome it. The post-dot-com crash has primed some people to see such a reversal as a realistic possibility, but I really doubt it.

If that's my conclusion as a balanced portfolio holder who did partially participate, then it's even more obvious for value tilters. You failed to collect the value premium over your life investing timeframe if you have been investing since the beginning of the 21st century. You lost that bet.

However, that doesn't mean anything about what to do going forward. New investors starting a value tilt now (though I expect them to be very few) might collect the fabled premium. And people who grit their teeth and stay in value, as they always planned to, may yet collect a modest consolation prize moving forward.
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silent_john
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Re: Investors Were Warned.

Post by silent_john »

I don't see how SCV tilt disagrees with the BH philosophy:

Develop a workable plan :thumbsup
Invest early and often :thumbsup
Never bear too much or too little risk :thumbsup
Diversify :thumbsup
Never try to time the market :thumbsup
Use index funds when possible :thumbsup
Keep costs low :thumbsup
Minimize taxes :thumbsup
Invest with simplicity :thumbsup
Stay the course :thumbsup

(interesting how Mel's Midcaps never get as much hate as all of the SCV threads. :wink: )
bogledogle87
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Re: Investors Were Warned.

Post by bogledogle87 »

Bogle64Pilot wrote: Mon Aug 31, 2020 3:05 pm And that is why I buy and hold ITOT. It’s the entire market and has plenty of international exposure for my tastes.
So by plenty, do you mean 0% ?
VTWAX and chill
whereskyle
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Re: Investors Were Warned.

Post by whereskyle »

EddyB wrote: Tue Sep 01, 2020 1:41 pm
whereskyle wrote: Tue Sep 01, 2020 6:29 am Just amazing to me how many tilters are upset that Taylor is recommending yet again a simple total-market portfolio.

Dear tilters,

The advice to buy and hold a single total-market fund is the single best piece of investing advice one can possibly give and one can possibly receive.

Period.

You may tilt all you like, but please do not pretend that advising people to tilt in any direction, with all the behavioral risks involved, is better than advising them to simply buy and hold the market. Absolutely not. Tilting is a game you can play for yourself, with experience, and with appropriate appreciation for the risks involved. But tilting is idiosyncratic, should remain as such, and is poor default advice for new investors.

Buying the market and holding it, however, is indispituably good advice for virtually every investor. Just ask Fama and French.

Please don't bash Taylor for criticizing tilters and advising people to hold the market. Such bashing to me is simply disingenuous, even if you tilt.
Except tilting toward the US, which gets a pass.
Omg. This is exhausting. Is it a bad idea to buy VTSAX? Yes or no? Because the answer is no, you are being cute. That's all.

You can do more, but you don't need to. This is the essence of simplicity. This is Taylor's advice. It is good advice.

Just because people don't do more does not mean that what they do do is wrong.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle
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vineviz
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Re: Investors Were Warned.

Post by vineviz »

whereskyle wrote: Tue Sep 01, 2020 2:52 pm
Omg. This is exhausting. Is it a bad idea to buy VTSAX? Yes or no? Because the answer is no, you are being cute. That's all.
It’s a bad idea to buy ONLY VTSAX.

Some people don’t know it’s a bad idea.

Some people do it because of peer pressure and convince themselves it’s not a bad idea.

Some people do it KNOWING it’s a bad idea.

US-only portfolios are a bit like smoking cigarettes. We have the freedom to do it if we choose to. It probably won’t kill us right away. We might die from some other cause before the lung cancer kills us. But no health expert thinks it’s a good idea, and anyone who thinks it’s a good idea is not much of a health expert.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch
whereskyle
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Re: Investors Were Warned.

Post by whereskyle »

vineviz wrote: Tue Sep 01, 2020 3:01 pm
whereskyle wrote: Tue Sep 01, 2020 2:52 pm
Omg. This is exhausting. Is it a bad idea to buy VTSAX? Yes or no? Because the answer is no, you are being cute. That's all.
It’s a bad idea to buy ONLY VTSAX.

Some people don’t know it’s a bad idea.

Some people do it because of peer pressure and convince themselves it’s not a bad idea.

Some people do it KNOWING it’s a bad idea.

US-only portfolios are a bit like smoking cigarettes. We have the freedom to do it if we choose to. It probably won’t kill us right away. We might die from some other cause before the lung cancer kills us. But no health expert thinks it’s a good idea, and anyone who thinks it’s a good idea is not much of a health expert.
Wow.

Buying VTSAX will slowly kill you.

You heard it here first.
"I am better off than he is – for he knows nothing and thinks that he knows. I neither know nor think that I know." - Socrates. "Nobody knows nothing." - Jack Bogle
EddyB
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Re: Investors Were Warned.

Post by EddyB »

whereskyle wrote: Tue Sep 01, 2020 2:52 pm
EddyB wrote: Tue Sep 01, 2020 1:41 pm
whereskyle wrote: Tue Sep 01, 2020 6:29 am Just amazing to me how many tilters are upset that Taylor is recommending yet again a simple total-market portfolio.

Dear tilters,

The advice to buy and hold a single total-market fund is the single best piece of investing advice one can possibly give and one can possibly receive.

Period.

You may tilt all you like, but please do not pretend that advising people to tilt in any direction, with all the behavioral risks involved, is better than advising them to simply buy and hold the market. Absolutely not. Tilting is a game you can play for yourself, with experience, and with appropriate appreciation for the risks involved. But tilting is idiosyncratic, should remain as such, and is poor default advice for new investors.

Buying the market and holding it, however, is indispituably good advice for virtually every investor. Just ask Fama and French.

Please don't bash Taylor for criticizing tilters and advising people to hold the market. Such bashing to me is simply disingenuous, even if you tilt.
Except tilting toward the US, which gets a pass.
Omg. This is exhausting. Is it a bad idea to buy VTSAX? Yes or no? Because the answer is no, you are being cute. That's all.

You can do more, but you don't need to. This is the essence of simplicity. This is Taylor's advice. It is good advice.

Just because people don't do more does not mean that what they do do is wrong.
Do you consider US-only, or US-overweighted investors to be tilters? Because advocates of that position do exactly what you describe above. You seem to be giving them a pass, though.
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vineviz
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Re: Investors Were Warned.

Post by vineviz »

whereskyle wrote: Tue Sep 01, 2020 3:05 pm Wow.

Buying VTSAX will slowly kill you.

You heard it here first.
Yes, obviously I meant for the analogy to be interpreted 100% literally.

Wow, indeed.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch
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sergeant
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Re: Investors Were Warned.

Post by sergeant »

I appreciate all the warnings but I'm doing fine with my small and midcap blend tilt. I could never decide if the value folks or the growth folks had a better argument so went with blend 30 years ago. I also invest outside the US and feel fine with the greater diversification.
AA- 20+ Years of Expenses Fixed Income/The remainder in Equities.
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Rowan Oak
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Re: Investors Were Warned.

Post by Rowan Oak »

vineviz wrote: Tue Sep 01, 2020 3:01 pm
whereskyle wrote: Tue Sep 01, 2020 2:52 pm
Omg. This is exhausting. Is it a bad idea to buy VTSAX? Yes or no? Because the answer is no, you are being cute. That's all.
It’s a bad idea to buy ONLY VTSAX.

Some people don’t know it’s a bad idea.

Some people do it because of peer pressure and convince themselves it’s not a bad idea.

Some people do it KNOWING it’s a bad idea.

US-only portfolios are a bit like smoking cigarettes. We have the freedom to do it if we choose to. It probably won’t kill us right away. We might die from some other cause before the lung cancer kills us. But no health expert thinks it’s a good idea, and anyone who thinks it’s a good idea is not much of a health expert.
I KNOW Total Stock Market Index (only or with some Total International Stock Index) is a great idea! No peer pressure intended.
“If you can get good at destroying your own wrong ideas, that is a great gift.” – Charlie Munger
Massdriver
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Re: Investors Were Warned.

Post by Massdriver »

I'm staying the course with my SCV tilt. I'm feeling pretty good about it. :beer
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vineviz
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Re: Investors Were Warned.

Post by vineviz »

Rowan Oak wrote: Tue Sep 01, 2020 3:41 pm I KNOW Total Stock Market Index (only or with some Total International Stock Index) is a great idea! No peer pressure intended.
VTSAX is a fine fund.

It's a portfolio holding ONLY VTSAX that is the obvious danger.
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch
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bluquark
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Re: Investors Were Warned.

Post by bluquark »

silent_john wrote: Tue Sep 01, 2020 2:35 pm I don't see how SCV tilt disagrees with the BH philosophy:
I'd switch around some of the thumbs there:

Develop a workable plan
Invest early and often
Never bear too much or too little risk
Diversify :thumbsdown
Never try to time the market
Use index funds when possible
Keep costs low :thumbsdown
Minimize taxes :thumbsdown
Invest with simplicity :thumbsdown
Stay the course ( :thumbsdown? Depends how psychologically unbearable these long periods of underperformance are)

To be clear, all of these thumbs are only mildly down. I'm not claiming that the costs and tax-inefficiency are awful with value, just worse than a broad index fund.
Last edited by bluquark on Tue Sep 01, 2020 4:05 pm, edited 1 time in total.
70/30 portfolio | Equity: global market weight | Bonds: 20% long-term munis - 10% LEMB
000
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Re: Investors Were Warned.

Post by 000 »

vineviz wrote: Tue Sep 01, 2020 3:01 pm
whereskyle wrote: Tue Sep 01, 2020 2:52 pm
Omg. This is exhausting. Is it a bad idea to buy VTSAX? Yes or no? Because the answer is no, you are being cute. That's all.
It’s a bad idea to buy ONLY VTSAX.

Some people don’t know it’s a bad idea.

Some people do it because of peer pressure and convince themselves it’s not a bad idea.

Some people do it KNOWING it’s a bad idea.

US-only portfolios are a bit like smoking cigarettes. We have the freedom to do it if we choose to. It probably won’t kill us right away. We might die from some other cause before the lung cancer kills us. But no health expert thinks it’s a good idea, and anyone who thinks it’s a good idea is not much of a health expert.
Frankly, this is an absurd statement. I say this as a person who holds a large helping of VEA.
AlwaysLearningMore
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Re: Investors Were Warned.

Post by AlwaysLearningMore »

vineviz wrote: Tue Sep 01, 2020 2:13 pm
What Is Economics?
Economics is the scientific study of the ownership, use, and exchange of scarce resources – often shortened to the science of scarcity. Economics is regarded as a social science because it uses scientific methods to build theories that can help explain the behaviour of individuals, groups and organisations. Economics attempts to explain economic behaviour, which arises when scarce resources are exchanged.
Lots of disciplines would love to be regarded as true scientists. Social scientists have long struggled to be held in the same esteem as biologists, chemists, physicists.
How often do economists set up large-scale double-blind controlled experiments?
Last edited by AlwaysLearningMore on Tue Sep 01, 2020 4:14 pm, edited 2 times in total.
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Kenkat
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Re: Investors Were Warned.

Post by Kenkat »

bluquark wrote: Tue Sep 01, 2020 2:21 pm If that's my conclusion as a balanced portfolio holder who did partially participate, then it's even more obvious for value tilters. You failed to collect the value premium over your life investing timeframe if you have been investing since the beginning of the 21st century. You lost that bet.
I think this will be period dependent and will vary for each investor. I think a world weighted allocation probably hurt returns more than a value slant, but even that would be time dependent.

My life investing timeframe started in 1987 and I always had some mix of value, growth, international, and bonds. Funds like Windsor, T. Rowe Price International Stock, Janus Fund and Vanguard Index 500 and Vanguard Long Term Corporate Bond come to mind. These all plugged along, as well as my 401k invested in privately managed funds (that did pretty well), until 1998 when I consolidated it all to Vanguard, due to a job change, with a Small and Value slant that I expanded upon until around year 2000 when I felt like it was set. I haven’t made any significant changes since.

I had a decent chunk of money that got accumulated through the 80s and 90s. I started tracking returns against an indexed benchmark that matched my overall US/Intl/Bond allocation in 1999. From 99-06, I beat that benchmark every year. After 2006, it’s been more split, but that lead built early on has me still ahead of my benchmark overall 99-2020 YTD. My slant is fairly modest to value and small and my International allocation is below a world weighted allocation.

So, in my situation and sequence of returns story, my modest small and value slant hasn’t hurt - it’s actually helped a little - so hence my stance. And going forward, this current situation reminds me a little of the year 2000 “value is dead” days.
Last edited by Kenkat on Tue Sep 01, 2020 4:33 pm, edited 4 times in total.
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LilyFleur
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Re: Investors Were Warned.

Post by LilyFleur »

iamlucky13 wrote: Mon Aug 31, 2020 9:39 pm I read all of the quotes. Two of them I find useful. The rest I have mixed feelings about, and some of them don't amount to much more than a "No it won't!" reaction to the "Yes it will!" back and forth arguments over whether SCV will revert to some hypothetically higher mean.

Here's the two that make good sense to me.
10-04-2003 Rick Ferri: "By overweighting to small-value, you are also adding risk above and beyond stock market risk."
4-09-2006 by Taylor: "My own feeling is that you can't go wrong (especially in taxable accounts) owning Total Stock Market Index Fund which owns nearly all growth, blend, and value stocks."
Indeed, it's hard to go wrong owning a total stock market fund.

I'm still curious to see how small and value do from here. I've been debating a moderate tilt to small value for a couple years. With a moderate tilt, the risk should be modest, and even though the upside also should be modest, it would satisfy the temptation to meddle without getting carried away.

It turns out my procrastination has so far been fortuitious. It still makes some sense to me that there could be a risk premium there, but if I'm going to be fully diligent, it also makes sense to try to more clearly define what level of risk I want to hold and the best way to achieve it. So no changes yet on my part.

I'm also resisting the urge to tilt to small value based solely on perception of it being good timing to catch a hypothetical reversion to the mean.
Is "tilt" equivalent to "asset allocation," i.e., "I've been debating including small value in my asset allocation?" Sometimes it seems we have different lexicons on this forum.
Last edited by LilyFleur on Tue Sep 01, 2020 4:19 pm, edited 1 time in total.
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UpsetRaptor
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Re: Investors Were Warned.

Post by UpsetRaptor »

vineviz wrote: Tue Sep 01, 2020 3:01 pm
whereskyle wrote: Tue Sep 01, 2020 2:52 pm
Omg. This is exhausting. Is it a bad idea to buy VTSAX? Yes or no? Because the answer is no, you are being cute. That's all.
It’s a bad idea to buy ONLY VTSAX.

Some people don’t know it’s a bad idea.

Some people do it because of peer pressure and convince themselves it’s not a bad idea.

Some people do it KNOWING it’s a bad idea.

US-only portfolios are a bit like smoking cigarettes. We have the freedom to do it if we choose to. It probably won’t kill us right away. We might die from some other cause before the lung cancer kills us. But no health expert thinks it’s a good idea, and anyone who thinks it’s a good idea is not much of a health expert.
There's a lot of people out there who started investing in 100% VTSAX 10, 20, or 30 years ago who will actually end up living a lot longer.
texasfight
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Re: Investors Were Warned.

Post by texasfight »

000 wrote: Tue Sep 01, 2020 4:03 pm
vineviz wrote: Tue Sep 01, 2020 3:01 pm
whereskyle wrote: Tue Sep 01, 2020 2:52 pm
Omg. This is exhausting. Is it a bad idea to buy VTSAX? Yes or no? Because the answer is no, you are being cute. That's all.
It’s a bad idea to buy ONLY VTSAX.

Some people don’t know it’s a bad idea.

Some people do it because of peer pressure and convince themselves it’s not a bad idea.

Some people do it KNOWING it’s a bad idea.

US-only portfolios are a bit like smoking cigarettes. We have the freedom to do it if we choose to. It probably won’t kill us right away. We might die from some other cause before the lung cancer kills us. But no health expert thinks it’s a good idea, and anyone who thinks it’s a good idea is not much of a health expert.
Frankly, this is an absurd statement. I say this as a person who holds a large helping of VEA.
This.

VTI and a treasury bond fund is all you need. EDV, VGLT, VGIT, VGSH depending on equity allocation.

60% VTI and 40% EDV (~ risk parity) is up 20% YTD, with an 11% CAGR since Jan 2008.
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Re: Investors Were Warned.

Post by rascott »

silent_john wrote: Tue Sep 01, 2020 2:35 pm

(interesting how Mel's Midcaps never get as much hate as all of the SCV threads. :wink: )
Guess they haven't underperformed enough in a couple of years for a nana-a-booboo..... your portfolio sucks post.
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Re: Correction

Post by abuss368 »

Taylor Larimore wrote: Tue Sep 01, 2020 10:59 am
burritoLover wrote: Mon Aug 31, 2020 4:01 pm Wow, Taylor is promoting large cap growth stocks now.
burritoLover:

I have never promoted the "large cap growth stocks" sector.

On the other hand, I try to be helpful by promoting "Investing Advice Inspired by Jack Bogle" (read the headline at the top of this page).

Best wishes:
Taylor
Jack Bogle's Words of Wisdom: "Total market indexing is the gold standard. Anything else, like sector investing, is a dilution of that standard."
I have never known Taylor to promote growth, small value, sectors, and so forth.

Taylor has always advocated and helped many investors (including my my family) by sharing his experiences and teaching the investing advice inspired by our mentor, Jack Bogle.
John C. Bogle: “Simplicity is the master key to financial success."
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Re: Investors Were Warned.

Post by abuss368 »

Taylor Larimore wrote: Mon Aug 31, 2020 3:01 pm Bogleheads:

The quarantine for the Coronavirus has given me an opportunity to review some old posts.

I was somewhat surprised to read many old posts warning us about the risk in Small-Cap and Small-Cap Value Funds (Small-Cap Value Funds are the worst performing of all Morningstar style categories). These were some of the warnings that have come true:

12-18-99 by Taylor: "Before you rely on past returns "proving" Small Company Growth funds to be the worst performers, consider this from John Waggoner in USA today 12-17-99: "Small-Company growth funds soard 372% the past 10 years, vs. 183% for small-company value.

8-26-2000 by jdvmd54: "DFA people keep saying small will outperform in the future. That is simply wrong and misleading. No one really knows."

8-15-2001 Taylor quoting Bogle: "Much of the early data on small caps is terribly flawed."

8-31-2001 by Vanguard's Gus Sauter: "I do not believe there is any reason to suspect that a given style will provide long-term outperformance. -- By buying the entire market, you significantly reduce the risk that such a focused approach entails."

4-09-02 by mole1: Interview with Burton Malkiel: "But if small stocks do poorly, anyone who put half his assets there when the rest of the market has only 20%, will fell like an absolute idiot. That's why I think a total stock market index fund is not only the simplest, but the very best core investment for most people."

11-28-02 astigra posted interview with Jack Bogle: "The evidence to justify the claim of small-cap superiority is too fragile a foundation on which to base a long-term strategy."

6-30-2003 by Taylor: "Overweighting styles and sectors is not that important in the long-term, and may not make any difference at all." - Rick Ferri' There are many authorities that agree with Rick's statement. I happen to be one of them. Mr. Bogle is another."

8-12-03 Lucas McCain posted this Rick Ferri quote: "I am 100% convinced that slice and dice has much more to do with marketing than money management."

8-28-2003 Houge-Loughran Study: "We Find no evidence that value portfolios significantly outperform growth portfolios."

9-8-2003 Taylor posted interview with Jason Zweig: "The so-called 'small-cap premium' is a complete illusion."

10-04-2003 Rick Ferri: "By overweighting to small-value, you are also adding risk above and beyond stock market risk."

1-02-2004 by ChristineM on Value study abstract: "The value premium is a small, concentrated and dying phenomenon."

03-16-04 by hafis50: "An economic downturn after the bursting of a stock market bubble may adversely affect small caps and value stocks much more than TSM."

4-09-2006 by Taylor: "My own feeling is that you can't go wrong (especially in taxable accounts) owning Total Stock Market Index Fund which owns nearly all growth, blend, and value stocks."

8-16-2004 by Taylor: "In my opinion it is very difficult (and may be dangerous) to try to "beat the market."

8-23-2004 by travismorien quoting Charlie Munger (Buffett's business partner): The whole concept of dividing it up into "value" and "growth" strikes me as twaddle. It's convenient for a bunch of pension fund consultants to get fees prattling about, and a way for one advisor to distinguish himself from another."

9-17-04 by jijnxxx: "Slice & dicers frequently mention the Fama/French influence on their strategy of tilting away from the cap-weighted total market and towards value and small-stocks. It's interesting that Fama himself does not endorse this interpretation of his research."

12-18-04 by Taylor: "Gummy has a webpage showing annual and average Value and S&P 500 returns and volatility from 1928-2000, During this period, Value stocks experienced approximately 50% more volatility than Growth stocks."

4-29-2006: Wm. Coaker II quote: "In 1998-1999 when the S&P 500 gained 55.6%, small value lost 7.9%."

7-18-2006 by Steverino: "Also, beware that small stocks can get hammered in down markets."

9-23-2006: by Taylor: "It was not long ago that few investors wanted to own Small Cap Value (SCV).Those that did were sorry. 15 year returns: LCG 17.15%; SCV 11.34%"

6-15-007 Bogle Blog: "I'm not one for trying to guess which styles will outperform or underperform--or when--and the data clearly show such changes are anything but sustainable or predictable."

8-17-2008 Taylor posted this Vanguard Quote: "After considering the evidence, Vanguard maintains that investors should generally hold market-weighted equity portfolios."

2/8/2015 JoMoney: "Portfolio Constituency Rules and Value Premium in the Small-Cap Value Space": "Our results may go a long way in explaining why the returns of market-based growth fund managers are statistically equal to returns of value fund managers over time

9-7-2017 Nisiprius: "There is not the slightest bit of support here for the idea that the value factor had any important effect in minimizing the effect of a bear market."

11/06/2018 Taylor: "According to a 90-year study by Bessembinder, when buy-and-hold portfolios of stocks are sorted by beginning market cap and held for a decade, large-cap portfolio returns are higher (153%) than the mean returns for small-cap portfolios (97%).

11/26/2018 Vanguard: "We believe that your portfolio should be style-neutral, not based toward either growth or value stocks."

Lesson learned: It can be expensive to ignore Boglehead Forum advice.

Best wishes.
Taylor
Jack Bogle's Words of Wisdom: "Total market indexing is the gold standard. Anything else, like sector investing, is a dilution of that standard."
That summary is incredible Taylor and "thank you" for your advice and teachings!

Jack and you are right! Own the haystack.
John C. Bogle: “Simplicity is the master key to financial success."
burritoLover
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Re: Investors Were Warned.

Post by burritoLover »

abuss368 wrote: Tue Sep 01, 2020 4:26 pm That summary is incredible Taylor and "thank you" for your advice and teachings!

Jack and you are right! Own the haystack.
Except international.
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Re: Investors Were Warned.

Post by iamlucky13 »

LilyFleur wrote: Tue Sep 01, 2020 4:15 pm
iamlucky13 wrote: Mon Aug 31, 2020 9:39 pm I read all of the quotes. Two of them I find useful. The rest I have mixed feelings about, and some of them don't amount to much more than a "No it won't!" reaction to the "Yes it will!" back and forth arguments over whether SCV will revert to some hypothetically higher mean.

Here's the two that make good sense to me.
10-04-2003 Rick Ferri: "By overweighting to small-value, you are also adding risk above and beyond stock market risk."
4-09-2006 by Taylor: "My own feeling is that you can't go wrong (especially in taxable accounts) owning Total Stock Market Index Fund which owns nearly all growth, blend, and value stocks."
Indeed, it's hard to go wrong owning a total stock market fund.

I'm still curious to see how small and value do from here. I've been debating a moderate tilt to small value for a couple years. With a moderate tilt, the risk should be modest, and even though the upside also should be modest, it would satisfy the temptation to meddle without getting carried away.

It turns out my procrastination has so far been fortuitious. It still makes some sense to me that there could be a risk premium there, but if I'm going to be fully diligent, it also makes sense to try to more clearly define what level of risk I want to hold and the best way to achieve it. So no changes yet on my part.

I'm also resisting the urge to tilt to small value based solely on perception of it being good timing to catch a hypothetical reversion to the mean.
Is "tilt" equivalent to "asset allocation," i.e., "I've been debating including small value in my asset allocation?" Sometimes it seems we have different lexicons on this forum.
Not quite. By tilt I mean hold it as a higher proportion of my asset allocation than a benchmark weight.

For example - if my asset allocation includes US Equities, a benchmark would be market cap weightings of the US stock market. For convenience, I tend to use VTSAX as my point of comparison. Morningstar describes VTSAX as 75% large cap, 15% mid-cap, and 5% small cap. At each cap level, Morningstar rates the holdings as comprising roughly equal weights of value, blend, and growth.

So stocks in that class are already in my asset allocation. If I have more than those ratios, I would then considered my self tilted towards that class, which I might do by selling 10-20% of my VTSAX holding and buying a small cap value fund with it.
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CyclingDuo
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Re: Investors Were Warned.

Post by CyclingDuo »

White Coat Investor wrote: Mon Aug 31, 2020 3:57 pmI'm looking forward to pulling this thread back up in 5 or 10 years when SV is the best performing asset class and LG has been underperforming for a while. It has swung back and forth for decades and likely will again.
Until then, we all just have to continue playing the drinking game. Anytime anybody mentions small cap, small cap value, or especially small cap international value - one has to take a drink. :mrgreen:

CyclingDuo
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vineviz
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Re: Investors Were Warned.

Post by vineviz »

000 wrote: Tue Sep 01, 2020 4:03 pm
vineviz wrote: Tue Sep 01, 2020 3:01 pm
whereskyle wrote: Tue Sep 01, 2020 2:52 pm
Omg. This is exhausting. Is it a bad idea to buy VTSAX? Yes or no? Because the answer is no, you are being cute. That's all.
It’s a bad idea to buy ONLY VTSAX.
Frankly, this is an absurd statement. I say this as a person who holds a large helping of VEA.
What's absurd about it?

Do you really think a 100% VTSAX portfolio is "a good idea" for other investors?
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch
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