Search found 8168 matches

by 000
Sun Nov 05, 2023 1:01 am
Forum: US Chapters
Topic: Searching for Lost Contributors
Replies: 537
Views: 138199

Re: Searching for Lost Contributors

JD2775 wrote: Wed Oct 25, 2023 10:09 pm
TwstdSista wrote: Mon Oct 09, 2023 10:15 am FYI, Willthrill is moving on to a new chapter in his life and shutting down his blog: https://www.thesensiblesteward.com/post ... le-steward
That dude has some serious restraint. 32k posts, was active literally today, yet hasn't posted on this site since Aug 2022. Just a lurker now? I miss his posts, I forget why he "left".
You could always send him a PM - he checks those.

But I would guess it was related to what happened to the last thread he started here.
by 000
Fri Oct 27, 2023 10:13 pm
Forum: Investing - Theory, News & General
Topic: [E*TRADE Accounts Transfer to Morgan Stanley]
Replies: 208
Views: 26221

Re: [E*TRADE Accounts Transfer to Morgan Stanley]

Make sure you get an official number you looked up on a different source.... :twisted:
by 000
Fri Oct 13, 2023 4:56 pm
Forum: Investing - Theory, News & General
Topic: Blackrock Retirement Income Guide
Replies: 48
Views: 8098

Re: Blackrock Retirement Income Guide

Anyone suggesting I swap my savings for a stream of non-inflation adjusted payments from an insurance company needs to disclose how much of their savings they've actually done this with. Over and over, the folks extolling the virtues of SPIAs turn out to not actually own any, though they say they will someday, maybe. Personally, except in rare cases, I don't find them to be very good deals. The SPIA, if purchased at appropriate age, lets you access mortality credits. This increases expected return and reduces sequence of return... That does not increase expected return. It returns your principal to you at a faster rate. Mortality credits increase expected return because they are a source of return inaccessible otherwise. You get a higher p...
by 000
Fri Oct 13, 2023 4:52 pm
Forum: Investing - Theory, News & General
Topic: Blackrock Retirement Income Guide
Replies: 48
Views: 8098

Re: Blackrock Retirement Income Guide

Valuethinker wrote: Fri Oct 13, 2023 5:11 am Not sure what other alternatives there are?
Commodity producer stocks?
by 000
Thu Oct 12, 2023 11:01 pm
Forum: Personal Investments
Topic: Trying to help extremely risk averse parents
Replies: 31
Views: 2912

Re: Trying to help extremely risk averse parents

Illiquid, but it comes as an FDIC insured CD but has some stock exposure:

https://www.bogleheads.org/wiki/Market-linked_CD
by 000
Sun Oct 01, 2023 12:06 am
Forum: Investing - Theory, News & General
Topic: Blackrock Retirement Income Guide
Replies: 48
Views: 8098

Re: Blackrock Retirement Income Guide

Northern Flicker wrote: Fri Sep 29, 2023 2:46 am On BH, it is common to assess the inflation risk of income annuities (SPIAs) in a vacuum. But by not having to cover as much longevity with bond principal, annuitization enables a portfolio with a lower allocation to fixed income. This reduces portfolio inflation risk, and the SPIA reduces sequence of return risk despite the higher equity allocation that boosts expected return.
Broad common stocks are not an inflation hedge. Stock performance during inflationary regimes, which in some cases can be long lasting, depends on the type of inflation, price elasticity, and other economic factors.
by 000
Sun Oct 01, 2023 12:03 am
Forum: Investing - Theory, News & General
Topic: Blackrock Retirement Income Guide
Replies: 48
Views: 8098

Re: Blackrock Retirement Income Guide

Anyone suggesting I swap my savings for a stream of non-inflation adjusted payments from an insurance company needs to disclose how much of their savings they've actually done this with. Over and over, the folks extolling the virtues of SPIAs turn out to not actually own any, though they say they will someday, maybe. Personally, except in rare cases, I don't find them to be very good deals. The SPIA, if purchased at appropriate age, lets you access mortality credits. This increases expected return and reduces sequence of return risk if you have a neutral view on inflation and issuer solvency. If the future outcome of those conditions is meaningfully different, then results will be different. As always, one risk for another. Here on Boglehe...
by 000
Sun Sep 17, 2023 8:55 pm
Forum: Personal Investments
Topic: Bonds - what are they good for?
Replies: 112
Views: 9271

Re: Bonds - what are they good for?

Bonds are good for guaranteeing a certain value (whether USD or CPI-adjusted) at a certain date. That's it. They offer no guarantee to exhibit any specific behavior at other times, including counterbalancing stocks during crashes or helping Bogleheads "sleep well".

As for why someone would want this guarantee, it's very simple. Stocks do not offer any kind of guarantee and there is indeed a real actual risk of stocks underperforming bonds or even losing value over a multi-decade period.

For those who do not like traditional bond funds there are iShares iBonds and Invesco Bulletshares which have a defined maturity.

For those who do not like brokerages TIPS can be held at Treasury Direct.
by 000
Sun Sep 17, 2023 1:36 am
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

RationalWalk wrote: Thu Sep 14, 2023 9:42 pm Yes it is. But since we're betting, I'd like to take the other side.
There are better bets on inflation than TIPS or a hypothetical CPI-linked annuity.... :twisted:
by 000
Thu Sep 14, 2023 4:55 pm
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

ScubaHogg wrote: Thu Sep 14, 2023 1:12 pm Well neither the SPIA nor the perpetuity know if they are ending or not, so I don’t see why that affects the duration one lick. I don’t think it does. And that formula above also more closely will get you the fair price of a SPIA given a certain payout.
Agree. Using normal life expectancy as an input to a risk calculation where the risk one is trying to insure is living beyond normal life expectancy is nonsense.
by 000
Thu Sep 14, 2023 4:52 pm
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

First of all it's not guaranteed to lose ground to inflation. That is a risk. The higher coupon from the SPIA actually provides a little additional cushion. A quibble: by definition, inflation will reduce the real value of fixed-return nominal investments so in that sense it's guaranteed that they will lose ground to inflation. Inflation is the risk. But there's not much uncertainty about it, at least since central banks discovered they can print money. Just how much "cushion" is provided via the initially higher nominal payments from a fixed SPIA is, as they say, "to be determined" by the rate of inflation. The cushion could deflate pretty quick. Deflation is possible. Money printing doesn't guarantee it can't happen, ...
by 000
Wed Sep 13, 2023 8:27 pm
Forum: Investing - Theory, News & General
Topic: On what are you most bullish?
Replies: 290
Views: 28022

Re: On what are you most bullish?

Admiral Fun wrote: Tue Sep 12, 2023 8:36 pm Time to revive this thread!
:sharebeer

Thanks for the revive. I had forgotten about this thread.

Looking forward to more replies!
by 000
Wed Sep 13, 2023 8:25 pm
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

Many of us hope that our investment portfolio returns will at least match or even exceed inflation. Viewed through that lens, I'm not sure why I'd want to lock in an investment that is guaranteed to lose ground to inflation year-after-year as long as I hold it. A nominal annuity will in fact do that. A TIPs/I-Bond ladder won't do that. Tell me again why I should choose the former over the latter. Is it that I hope that time will run out for me before the real value of the annuity has been mostly eaten away? Is that an investment or a bet? First of all it's not guaranteed to lose ground to inflation. That is a risk. The higher coupon from the SPIA actually provides a little additional cushion. Second, assuming a sufficiently high payout rat...
by 000
Wed Sep 13, 2023 3:04 am
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

petulant wrote: Tue Sep 12, 2023 7:22 am A comparison of a rolling bond ladder and a SPIA is not apples-to-apples with respect to cashflows.
Nor is a bond fund as you used in your comparison. The whole point of buying a SPIA is... wait for it... to get different cashflows than bonds provide.
by 000
Mon Sep 11, 2023 11:55 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

Excellent post DonIce. But what international allocation does it inform?
by 000
Mon Sep 11, 2023 9:58 pm
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

I don't get 9.5% from bobcat's formula https://www.bogleheads.org/forum/viewtopic.php?p=1471246#p1471246 . There is also a lack of evidence provided for 17 years and SPIA rates being as generous in 1971 as today. But this is just one situation from a half century ago. Inflation over decades does not affect a reinvested bond portfolio and a lump sum annuity the same, assuming rates rise with inflation, because the bond gets reinvestment opportunities at higher rates . I created a spreadsheet comparing a 10YR bond reinvested every decade versus a one time lump sum annuity. By varying the inflation sequence and magnitude, I was able to get meaningfully different results in terms of the net credit/deficit from the instrument. Sometimes one was ...
by 000
Sat Sep 09, 2023 7:23 pm
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

Yep, the 1970s was really bad inflation. It was also one of the worst periods for both stocks and bonds--the former only had less than a 1% real return (1971-1980, per simba). There is a reason 1966- and similar periods are the test cases for SWR. Look, my position here is not that inflation is good for a portfolio or that SPIAs aren't affected by inflation. My position is that SPIAs are not special in how bad inflation is . My critique of my interlocutors would be something like the following: 1. If you are a person who is ok with VBMFX or BND, why are you complaining about inflation with SPIAs? They are literally both impacted by inflation in basically the same way. 2. If you a person who is not ok with VBMFX or BND, why are you not goin...
by 000
Fri Sep 08, 2023 6:57 pm
Forum: Personal Finance (Not Investing)
Topic: Non-COLA Pension: Any reason to take vs Lumpsum
Replies: 34
Views: 3566

Re: Non-COLA Pension: Any reason to take vs Lumpsum

When one already has so many expenses saved, there is an argument to take the annuity just as a kind of protection against future portfolio management mishap, e.g. due to declining faculties. On the other hand, the amount in this case may be dwarfed by portfolio income and/or future inflation.

Either way, I would double check if there are any extra benefits or legal protections associated with the pension and compare the offered rate to commercially available SPIAs.
by 000
Fri Sep 08, 2023 12:21 am
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

I disagree. Most retirees spend less as they get older, so not all of their sources of income need to be inflation-adjusted. Many pensions don't offer inflation adjustment either. Some government pensions only provide a 2% or 3% annual increase (not indexed to inflation), and some private pensions don't offer any increase at all. And people do just fine. None of those reasons, although true, are arguments in favor of annuities specifically. "spend less as they get older" -> a portfolio doesn't need to be as large as would seem to support a classic fixed SWR "not all income needs to be inflation-adjusted" -> another form of "there's enough from other sources so the decision is actually irrelevant" "pension...
by 000
Thu Sep 07, 2023 9:53 pm
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

RationalWalk wrote: Thu Sep 07, 2023 10:38 am The nominal annuity "Catch 22" seems to be that the value of the "longevity insurance" is mitigated by inflation risk. The longer you live the more inflation risk you are exposed to. That's true whether you have a flat-rate or step-up SPIA.
Agree. It's not good for how it's commonly promoted to "make sure granny won't run of out money". But if one has a neutral view on inflation, it is good for juicing expected return and reducing SORR as you can't get mortality credits anywhere else.
by 000
Thu Sep 07, 2023 9:47 pm
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

petulant wrote: Thu Sep 07, 2023 11:09 am All that reasoning only applies if the retiree doesn't adjust their portfolio to reflect the existence of the annuity. If the retiree would have had a 60/40 stock/bond portfolio, then they are already troubled by inflation for the bond allocation, so moving all or some of that amount into an annuity and then using stocks for bonuses/inflation mitigation has substantially similar inflation exposure as a 60/40, at least at the moment of annuitization.
Fallacious argument as it presupposes the 40% must be in nominal bonds in a world where TIPS (and commodities) exist.

Also stocks have not mitigated inflation well over short term periods, like a decade, which is problematic for those withdrawing regularly.
by 000
Thu Sep 07, 2023 9:43 pm
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

A SPIA can play a role as part of the guaranteed lifetime income "floor", even though it is not inflation-adjusted. If a retiree's SS (inflation-adjusted) provides a large part of the income floor, the declining real value of the SPIA payment becomes less of an issue. And, most retirees spend less as they age so real income needs decline anyway. IMO a SPIA should only be considered at age 75 or so, but everyone's situation is different. The same could probably be said for a FIA with Income Rider (guaranteed lifetime payment), but I don't an advantage over a SPIA. Social security is a red herring. See above. You're basically arguing that if social security is nearly enough, other things matter much less... which actually isn't an ...
by 000
Thu Sep 07, 2023 9:40 pm
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

I believe, in the USA, one can still buy "escalating" annuities, which increase by a fixed percentage every year? Yes. It is called a COLA - cost of living adjustment - although it does not literally adjust for cost of living. That allows partial inflation protection (but I entirely concede it doesn't mean the safe criterion for annuities). No, it worsens inflation risk by moving more of the payments to the future for a given principal amount. The main functions are now, I think: - to provide for someone who cannot manage a portfolio, where no outside support to do that is available. I have a relative who is fiscally incontinent-- if they have it, they spend more than they have. If I had the money, I would buy them an annuity to ...
by 000
Wed Sep 06, 2023 9:43 pm
Forum: Investing - Theory, News & General
Topic: Annuity article by Wade Pfau
Replies: 288
Views: 33581

Re: Annuity article by Wade Pfau

Then I noticed this from Oblivious: First: a new edition of my book Can I Retire is now available (print version here, Kindle version here). As far as what’s new, it’s all the usual updates (inflation adjustments, tax changes, etc.). In addition: There’s no longer a chapter specifically dedicated to lifetime annuities. (With no inflation-adjusted versions available anymore, I have a hard time actually recommending them. ) https://obliviousinvestor.com Mmmmm... It's a reasonable position. Using a nominal stream to fund real expenses doesn't fully insure the risk of outliving your spending power. SPIAs might still serve a purpose though.... but definitely not guaranteeing a risk averse investor won't run out of "money" due to longe...
by 000
Wed Sep 06, 2023 12:23 am
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

There's plenty of "passive" investments that are still not reasonable investments. If you live in Belgium and invest 100% in a Belgium index, that may be passive but it'd be pretty dumb. Some countries are big enough and diversified enough that it looks slightly less dumb. The US is the only one where the argument of investing solely in that one country being reasonable could even be said with a straight face, due to it being more than half of global market cap. A Canadian that passively invests 100% in Canadian stocks is making a big mistake, as shown by performance history, overexposure to the resource sector, exposure to only a tiny fraction of global market cap, extreme uncompensated risk exposure to a few geopolitical risk f...
by 000
Wed Sep 06, 2023 12:22 am
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

The country separation is important because each market is governed by different laws, regulations, currencies and domestic investors. The Chinese market is obviously very different than the rest of the world, for example. I guess the Eurozone is a bit fuzzy in this regard because they might share some laws, regulations and currency. So no, 100 securities across multiple markets won't be a haystack in my view. And if you remember, another thing I mentioned is to capture 80%+ of the domestic market (like S&P500). I don't see how you would do that when those 100 tickers span across multiple markets. Either way it's irrelevant because this kind of "argument by definition" is fallacious. Asserting that something is a certain kind...
by 000
Wed Sep 06, 2023 12:04 am
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

Marseille07 wrote: Tue Sep 05, 2023 11:56 pm
Nathan Drake wrote: Tue Sep 05, 2023 11:54 pm Investing can be both simple and produce a poor outcome. Same reasons used to justify a single haystack extend to the actual entire haystack
Of course. Not all haystacks are equal, and we have to accept that your haystacks of choice might trail.
Wait a minute. Just a moment ago you said you cared about absolute performance, not relative performance.

But here Nathan was talking about absolute performance ("poor outcome") and your response is about relative performance ("might trail").

:confused
by 000
Tue Sep 05, 2023 11:56 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

Marseille07 wrote: Tue Sep 05, 2023 11:53 pm
JBTX wrote: Tue Sep 05, 2023 11:48 pm So the official definition of haystack is based upon country of company domicile? So ex U.S. is really probably 20 or 30 different haystacks?
I'm not defining the official definition, I'm just sharing my perspective outside of this "VT is the only haystack" idea. I'd appreciate if you could understand different perspectives than your own.
Defining something as a haystack, looking at it and saying "yep, that's a haystack", then asserting it's a good enough haystack seems a weak argument.
by 000
Tue Sep 05, 2023 11:52 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

JBTX wrote: Tue Sep 05, 2023 11:48 pm
Marseille07 wrote: Tue Sep 05, 2023 11:43 pm
JBTX wrote: Tue Sep 05, 2023 11:42 pm So is QQQ a haystack?
Does it capture 80%+ of US TSM? (I don't know the answer to it)
So the official definition of haystack is based upon country of company domicile? So ex U.S. is really probably 20 or 30 different haystacks?
Do two pieces of hay make a stack? Does one piece? Do zero pieces make the null stack?
by 000
Tue Sep 05, 2023 11:34 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

I fail to see the relevancy of SCV to this thread....
by 000
Tue Sep 05, 2023 11:07 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

Marseille07 wrote: Tue Sep 05, 2023 10:29 pm As far as seeking the highest possible returns in the most diversified fashion, well, I never said that's my goal.
Something I've been wondering... why is your board name a french city if you're such a strong supporter of 100% US equity investing?

It's doubly ironic because France is one of the countries that people often besmirch as a reason not to invest internationally......
by 000
Tue Sep 05, 2023 10:21 pm
Forum: Personal Consumer Issues
Topic: Guaranteed tax free high income with rock recycling
Replies: 50
Views: 6925

Re: Guaranteed tax free high income with rock recycling

countmein wrote: Tue Sep 05, 2023 8:45 pm I submit that this is the worst thread to ever appear on this site
This thread doesn't rock

Its viability is between a rock and a hard place

I doubt it will be here rockin' around the Christmas tree

No thread's a winner with a double dose of rock salt from the mods

The OP really needs to get some sense before he goes completely off his rocker
by 000
Fri Sep 01, 2023 7:58 pm
Forum: Investing - Theory, News & General
Topic: [E*TRADE Accounts Transfer to Morgan Stanley]
Replies: 208
Views: 26221

Re: E*TRADE Accounts Transfer to Morgan Stanley This Weekend

Carno wrote: Thu Aug 31, 2023 9:30 pm The key reason I had accounts with E*TRADE was their bond desk platform that allowed trading in all grade bonds and not just investment grades. As far as I know, all major brokers such as Fidelity, Merrill Edge, Schwab currently allow only investment grade trades on their platforms. I'm afraid that once E*TRADE accounts have transferred to Morgan Stanley, trading in non-investment grades may not be allowed. Should that happen, I will waste no time to transfer my accounts to Fidelity.
Interactive Brokers would likely serve your bond trading needs.
by 000
Fri Sep 01, 2023 7:49 pm
Forum: Personal Investments
Topic: Curious about EBSAX
Replies: 10
Views: 774

Re: Curious about EBSAX

Not legal advice but as far as I know, the fund assumes the risk of investing in the subsidiary; there is no plausible circumstance where liabilities originating from the subsidiary in excess of the fund assets would pierce the corporate veil of the 1940 act mutual fund and become obligations of its investors.
by 000
Fri Sep 01, 2023 7:43 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

Northern Flicker wrote: Fri Sep 01, 2023 7:03 pm Growth potential is just revenue projected further into the future.
But P/E is not a projected measure.
But there are growth and value US stocks and growth and value ex-US stocks, but not growth and value markets.
True, but there are more growthy and more valuey markets. In any event going to back claims made by you and others upthread, lower P/E (or pick your favorite valuation metric) is not entirely informed by a higher risk premium. There are other factors (lol) in play.
by 000
Fri Sep 01, 2023 5:27 pm
Forum: Personal Investments
Topic: Curious about EBSAX
Replies: 10
Views: 774

Re: Curious about EBSAX

I have seen several funds which invest in commodity futures do so in the same fashion. I wonder if there is some tax benefit but can't remember.

Assuming this is a 1940 act mutual fund, then the answer is yes to your last two questions as well.
by 000
Fri Sep 01, 2023 5:23 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

tvubpwcisla wrote: Fri Sep 01, 2023 5:20 pm The Vanguard Total International Index fund invests in "Grupo Carso SAB de CV". I have no idea what that is?
Google/wikipedia are your friend: https://en.wikipedia.org/wiki/Grupo_Carso
by 000
Fri Sep 01, 2023 5:21 pm
Forum: Investing - Theory, News & General
Topic: High-Yield Bonds now?
Replies: 31
Views: 3792

Re: High-Yield Bonds now?

I've heard a lot about High-Yield Bonds lately. You can now invest in High-Yield Bonds that yield 10%. That's honestly more than I expect the stockmarket to return. High-Yield Bonds are more risky than ordinary bonds, but they are considered less risky than stocks. So is that a free lunch? Exit stocks and enter High-Yield for less risk and more return? It's not a free lunch nor is chasing the absolutely highest yielding bonds even likely to be the tastiest lunch as others have mentioned. However assuming this asset class is not too taxing for the investor, diversification into credit risk probably diversifies the portfolio somewhat (despite claims that all you need are stocks and treasuries). We have recently seen how during rising rates, ...
by 000
Fri Sep 01, 2023 5:13 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

The growth potential is wrapped into projected cash flows. I think what you are getting at the behavioral theory, which posits that investors tend to overpay for growth. But you then gave to let go of the notion that the market prices stocks fairly, at which point all expected returns are just pie-in-the-sky. No I am not getting into the behavioral theory. It is rational to pay higher P/E for stock in a business with more profit growth potential than another stock with less potential given same risk level for both. In a theoretical perfect information market, for these two stocks there would be parity of Forward P/E projected into the future forever, but not P/E of recent earnings. For example, utilities are not necessarily riskier than an...
by 000
Thu Aug 31, 2023 8:34 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

Northern Flicker wrote: Thu Aug 31, 2023 7:18 pm Stocks with lower PE's are not "stocks on sale" but stocks for which the market is discounting in a steeper risk premium reflective of greater uncertainty that projected cash flows will materialize.
I don't think PE is solely a risk story. There is a growth element too. A stock can have a low PE due to perceived low revenue growth potential, not cashflow risk.
by 000
Tue Aug 29, 2023 1:07 am
Forum: Personal Investments
Topic: Closing out the settlement fund
Replies: 7
Views: 1317

Re: Closing out the settlement fund

Send dividends on the settlement fund to your linked banked account.
by 000
Sun Aug 27, 2023 6:01 pm
Forum: Personal Investments
Topic: Thoughts on Vanguard's *Actively* Managed Mutual Funds
Replies: 50
Views: 4698

Re: Thoughts on Vanguard's *Actively* Managed Mutual Funds

Months have nothing to do with it. Companies only release their earnings data quarterly, typically 1 or 2 weeks after the end of a quarter. And then the S&P committee meets and analyses the data only once a quarter. Tesla was admitted to the S&P in the fourth quarter of 2020 after their fourth quarter meeting exactly as expected. And what does Etsy have to do with it. Etsy was profitable when Tesla was losing money. According to this article and many others, Tesla was skipped at least once for inclusion when all necessary criteria were met. It was speculated that they would enter in September here by CNBC as the criteria were met, and surprise is expressed that they were not. Etsy has nothing to do with it other than that and 2 oth...
by 000
Sun Aug 27, 2023 5:59 pm
Forum: Personal Investments
Topic: American Funds
Replies: 5
Views: 1159

Re: American Funds

American Funds has so many different share classes for its funds we can't give a good answer without a list of the fund names and ERs for each.
by 000
Sat Aug 26, 2023 5:14 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

He's not making a currency prediction. Rather he is pointing out what it does to the minds of "60% of Global Investors" when currency "steals" a big chunk of their returns each year, for over 10 years.....(because they are all investing in US dollars) First of all, this sounds like a prediction to me: International equities are just going to have to outperform probably because of a falling dollar. And they’re going to have to do that for long enough that the public just eventually buys into, “Okay, we are going to look at this based on fundamentals.”" Second, Dr. Kelly fails to understand why USD gained the last 10 years. Once he understands it, he'd see that that's just a different way of saying "US prospered...
by 000
Fri Aug 25, 2023 7:13 pm
Forum: Investing - Theory, News & General
Topic: Four Pillars — Metals and Commodity Producers?
Replies: 18
Views: 2848

Re: Four Pillars — Metals and Commodity Producers?

GUNR is a more diversified one I hold.
by 000
Fri Aug 25, 2023 7:11 pm
Forum: Personal Investments
Topic: Thoughts on Vanguard's *Actively* Managed Mutual Funds
Replies: 50
Views: 4698

Re: Thoughts on Vanguard's *Actively* Managed Index Mutual Funds

What's an Actively Managed Index?
by 000
Fri Aug 25, 2023 4:34 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International versus US (The official list of arguments)

Marseille07 wrote: Fri Aug 25, 2023 8:56 am
CraigTester wrote: Fri Aug 25, 2023 8:31 am Maybe we'll try to get a larger group involved, as you say, after a US losing streak.
A comment like this is why HomerJ described you as follows:
The problem is that the OP is a Chevy guy who came into a car forum, and started an "official" thread on which is better? "Ford or Chevy"? He can try to be neutral, but it's pretty hard.
He was clearly quoting jeffyscott, neither of whom was rooting for "a US losing streak", only noting that these discussions will generally be futile until the situation where diversification matters manifests again.
by 000
Thu Aug 24, 2023 10:04 pm
Forum: Investing - Theory, News & General
Topic: International (Non-US) versus US Equities (The "Arguments")
Replies: 5216
Views: 832722

Re: International (Non-US) versus US Equities (The "Arguments")

You can't really reduce equity risk by holding a different haystack of equities. This isn't equities vs bonds. This also isn't penny stocks vs high-div stocks. Both haystacks are risky: https://www.portfoliovisualizer.com/backtest-asset-class-allocation?s=y&mode=1&timePeriod=4&startYear=1972&firstMonth=1&endYear=2023&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=1&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&debtAmount=0&debtInterest=0.0&maintenanceMargin=25.0&leveragedBenchmark=false&am...