Search found 17674 matches

by rkhusky
Thu Mar 28, 2024 7:46 am
Forum: Personal Investments
Topic: Which Bonds Fund To Buy
Replies: 13
Views: 1311

Re: Which Bonds Fund To Buy

samulta52 wrote: Wed Mar 27, 2024 10:31 pm 56 and hoping to retire in 6 yrs. I have bond funds and lost quite a bit in 2022. So now I moving some of that to TIPS to cover part of my expenses during the retirement. I also have some I-bonds.
Real losses or paper losses?


If OP puts tax-deferred all into bonds, he is at about 60/40. Stocks dropped 50% three times in the last 50 years. Bonds have dropped 20% once in the last 50 years. With those drops, a 60/40 portfolio is 30% at risk from the stocks and 8% at risk from the bonds. I would not worry about putting the whole bond allocation into Total Bond or into an Int Treasury fund. Now is a good time to do that while stocks are near an all time high and bond funds are still down a bit, but paying good interest rates.
by rkhusky
Wed Mar 27, 2024 8:43 pm
Forum: Investing - Theory, News & General
Topic: Daniel Kahneman dies at 90
Replies: 11
Views: 2311

Re: Daniel Kahneman dies at 90

It's been interesting to see all the cognitive biases exhibited in posts here, like recency bias and loss aversion.
by rkhusky
Wed Mar 27, 2024 8:22 pm
Forum: Forum Issues and Administration
Topic: How do I stop getting notifications of a given thread?
Replies: 5
Views: 304

Re: How do I stop getting notifications of a given thread?

How are you being notified? Email or just the Notifications list?
by rkhusky
Wed Mar 27, 2024 3:54 pm
Forum: Personal Investments
Topic: Exchange FSKAX for VTI at Fidelity in taxable account
Replies: 5
Views: 406

Re: Exchange FSKAX for VTI at Fidelity in taxable account

If you have VTI in any of your or your spouse’s other accounts, watch out for wash sales when selling VTI for a loss in your taxable account.
by rkhusky
Wed Mar 27, 2024 12:41 pm
Forum: Investing - Theory, News & General
Topic: More Evidence Against Factor Investing
Replies: 650
Views: 46381

Re: More Evidence Against Factor Investing

Since we can’t predict the future, ie know what the market is going to do at a particular time in the future, a higher amount of volatility makes it more probable that there will be a larger downturn when we don’t want it in the future.

I would also guess that a higher daily volatility is correlated with a higher monthly volatility which is correlated with a higher yearly volatility which is correlated with a higher 10-year volatility.
by rkhusky
Wed Mar 27, 2024 12:16 pm
Forum: Personal Investments
Topic: transferring an IRA from Schwab to Vanguard - problem ("ineligble account")
Replies: 7
Views: 613

Re: transferring an IRA from Schwab to Vanguard - problem ("ineligble account")

Schwab must not have been as careful when you moved the first time. Receiving brokerage is on the hook for transfer errors. Perhaps change your name on the Schwab account.
by rkhusky
Wed Mar 27, 2024 8:23 am
Forum: Investing - Theory, News & General
Topic: Can you do better than BND, Part 2: Test across bear and bull markets
Replies: 30
Views: 3586

Re: Can you do better than BND, Part 2: Test across bear and bull markets

One thing that is difficult to separate out in these historical analyses is the effects from costs, technology and participation. In earlier years, it was more expensive and cumbersome to invest and to analyze choices, and not many people participated. Today, it is super simple and inexpensive to invest in a wide variety of products, and to pull up performance charts and investing analyses, and most everyone is at least dabbling in investing. So, it’s not clear if one should expect the next bull or bear bond market to look like these past ones. Is the narrowing of Treasury vs Total Bond performance due to bear vs bull or to the different investing eras? Edit: a couple possible follow-ups. Compare the first half of the recent bull with the l...
by rkhusky
Wed Mar 27, 2024 7:31 am
Forum: Personal Finance (Not Investing)
Topic: Section 199A dividends
Replies: 3
Views: 545

Re: Section 199A dividends

They don’t have to, if you don’t want to claim the deduction. I didn’t one year, when the deduction was like $10.
by rkhusky
Tue Mar 26, 2024 6:34 pm
Forum: Personal Investments
Topic: I think my Mom, recently widowed, is looking at a tax bomb
Replies: 28
Views: 4853

Re: I think my Mom, recently widowed, is looking at a tax bomb

With taxation of SS, it doesn’t take much to get into 22% marginal rate.

Might want to see how much you would need to convert to get below the band of 40% marginal rate. Or whether you will always be far above it.

https://www.bogleheads.org/wiki/Taxatio ... y_benefits

https://www.bogleheads.org/wiki/File:SS ... le2023.png
by rkhusky
Tue Mar 26, 2024 6:23 pm
Forum: Investing - Theory, News & General
Topic: Original proponent of the 30/70 allocation?
Replies: 84
Views: 13373

Re: Original proponent of the 30/70 allocation?

The folks holding Total Bond (or any other bond fund besides a MM) in 2022 would certainly disagree that they had no interest rate risk and did not see a significant drop in their portfolio. In fact, if they were 100% Total Bond, they were undoubtedly dismayed. Maybe they should have held a 100% bond portfolio with no interest rate risk. You need 2x the portfolio to do that with 30/70 because bonds funds have to be available for rebalancing and the unknown time of rebalancing carries interest rate risk. Unfortunately, the stock market does not follow a known statistical distribution and statistical analyses are really only useful for 1 sigfig estimates, if that. Nevertheless, a 100% bigger portfolio can be shown to provide many times more ...
by rkhusky
Tue Mar 26, 2024 6:18 pm
Forum: Personal Finance (Not Investing)
Topic: Does the IRS website have the ROTH contribution withdrawal rules?
Replies: 6
Views: 366

Re: Does the IRS website have the ROTH contribution withdrawal rules?

The 10% penalty only applies to the taxable portion of the withdrawal.
The return of contribution is not taxable.
Contributions are withdrawn first.
(All in Pub 590B)
by rkhusky
Tue Mar 26, 2024 5:43 pm
Forum: Investing - Theory, News & General
Topic: Original proponent of the 30/70 allocation?
Replies: 84
Views: 13373

Re: Original proponent of the 30/70 allocation?

Anyone know? Who was the first to argue for 30/70 as the base case, best bet, for a conservative retiree seeking to sustain their portfolio through great age?* I don't know who was the first to advocate for a 30/70 portfolio, but I've always thought this was an excellent article by a financial advisor named Mitch Anthony. I don't know anything about the man but I've loved this article for years and refer back to it every time I'm tempted to get overly aggressive (for me) with my asset allocation: https://www.fa-mag.com/news/article-1155.html?section=2 Title: Stairway To Heaven Good article. Probably similar to ones following 2008. 2001/2002 looks brutal. I didn’t have enough invested then to be concerned. (Contributions were offsetting dro...
by rkhusky
Tue Mar 26, 2024 5:28 pm
Forum: Investing - Theory, News & General
Topic: Original proponent of the 30/70 allocation?
Replies: 84
Views: 13373

Re: Original proponent of the 30/70 allocation?

Clearly 0/100 is superior to 30/70 using this line of reasoning of managing drops. 0% is not about the same as 20%. And applying probabilities to investing in too specific a manner doesn’t make much sense. One sigfig at best. Maybe you didn't understand the 100% fixed income portfolio would have no interest rate risk and would experience 0% drop. Applying probability correctly makes a ton of sense - like including the largest variable (portfolio size) in a risk analysis. As to studies that ignore the most important variable, I would be careful of picking a 30/70 accumulation just because 30/70 backtested well in decumulation when ignoring the size of the portfolio. You may be increasing your failure rate dramatically because you are not be...
by rkhusky
Tue Mar 26, 2024 5:17 pm
Forum: Investing - Theory, News & General
Topic: Never selling shares
Replies: 57
Views: 4241

Re: Never selling shares

Hopefully, someone doesn’t skimp on spending because they get trapped into hoarding their shares.
by rkhusky
Tue Mar 26, 2024 2:24 pm
Forum: Investing - Theory, News & General
Topic: Looking for advice on unhappy experience in VG short term bond fund
Replies: 66
Views: 5591

Re: Looking for advice on unhappy experience in VG short term bond fund

Individual bonds and brokered CD’s won’t work either, because their values change with interest rates too.
by rkhusky
Tue Mar 26, 2024 1:49 pm
Forum: Investing - Theory, News & General
Topic: Original proponent of the 30/70 allocation?
Replies: 84
Views: 13373

Re: Original proponent of the 30/70 allocation?

abc132 wrote: Tue Mar 26, 2024 12:55 pm Clearly 0/100 is superior to 30/70 using this line of reasoning of managing drops.
0% is not about the same as 20%.

And applying probabilities to investing in too specific a manner doesn’t make much sense. One sigfig at best.
by rkhusky
Tue Mar 26, 2024 1:39 pm
Forum: Personal Finance (Not Investing)
Topic: Gift tax?
Replies: 7
Views: 621

Re: Gift tax?

The IRS has a required minimum interest rate. If you are paying at least that rate, there is no gift.

https://www.irs.gov/applicable-federal-rates

Gift tax only applies after the exclusion has been met, which is about $13.6M for single.
by rkhusky
Tue Mar 26, 2024 12:42 pm
Forum: Investing - Theory, News & General
Topic: Original proponent of the 30/70 allocation?
Replies: 84
Views: 13373

Re: Original proponent of the 30/70 allocation?

The future doesn’t necessarily have to be a draw from the past.

If one considers a 50% drop in the stock market to be about as likely as a 20% drop in Total Bond, then a 30/70 portfolio has about equal risk from the bond side and the stock side.
by rkhusky
Tue Mar 26, 2024 10:51 am
Forum: Personal Investments
Topic: Traditional Vs Roth 401k
Replies: 5
Views: 512

Re: Traditional Vs Roth 401k

Traditional 401K with the tax savings used to fund a Roth IRA works for most people in mid to high brackets.
by rkhusky
Tue Mar 26, 2024 10:45 am
Forum: Investing - Theory, News & General
Topic: Holding 100% stocks after FI best option for longer time horizons?
Replies: 88
Views: 10557

Re: Holding 100% stocks after FI best option for longer time horizons?

The future will not necessarily be a sample of the past.
by rkhusky
Tue Mar 26, 2024 8:04 am
Forum: Personal Investments
Topic: VXUS Dividends showing up as all non-qualified
Replies: 17
Views: 1814

Re: VXUS Dividends showing up as all non-qualified

On my Fidelity account, dividends show as non-qualified all year and get adjusted for qualified and foreign-tax early in the next year before tax time and reported properly on my 1099 Doesn’t seem very user-friendly to show incorrect information, but all brokerages have little quirks like this that you have to get used to. I think Fidelity might also show capital gains in IRA’s, which is meaningless. I think it’s less “incorrect” than it is “premature”. Vanguard doesn’t parse out the qualified vs qualified split until the end of the year, so they can’t tell Fidelity what it is before then. If Fido were to estimate and be wrong, I imagine people would be even more irritated. Saying 0% is incorrect. Saying nothing would be better. Then you’d...
by rkhusky
Tue Mar 26, 2024 8:02 am
Forum: Personal Investments
Topic: How quickly can I liquidate a mutual fund at Vanguard to my linked bank account?
Replies: 9
Views: 1269

Re: How quickly can I liquidate a mutual fund at Vanguard to my linked bank account?

I've recently sold VUSXX and had it show up at my bank the next day. My bank has been advertising early deposits for things like direct deposits and transfers from brokerages. Took 1 day off the former time frame. Thanks for this response. On the mobile app, when I sell VUSXX, it can only go to my settlement fund. I tried desktop version and I now get the option to send the money to either my settlement fund or any of my linked accounts. 🙏 Mine was a scheduled withdrawal. I don’t use the app, but on the website there are different options for selling, Transfer money and Transact. If the app has different options, try them to see if you can withdraw directly to your bank. On the website, there is also a link for “Use the full sell page”. Pe...
by rkhusky
Tue Mar 26, 2024 7:55 am
Forum: Investing - Theory, News & General
Topic: Looking for advice on unhappy experience in VG short term bond fund
Replies: 66
Views: 5591

Re: Looking for advice on unhappy experience in VG short term bond fund

jocdoc wrote: Tue Mar 26, 2024 5:55 am It all depends on what you mean by safe. I would not consider bond funds or single bonds as safe investmentx, just safer than stocks. They are less volatile than stocks.
Yes, safe is a relative term. And then there is the question of “safe from what?”, safe from lost principal, safe from inflation, safe from not meeting my income needs, safe from under-performing other alternatives, etc. The more things you are safe from, generally the lower the return, similar to paying for insurance.
by rkhusky
Mon Mar 25, 2024 8:20 pm
Forum: Personal Finance (Not Investing)
Topic: Hospital not following up with my insurance for large claim
Replies: 24
Views: 2261

Re: Hospital not following up with my insurance for large claim

I had a hospital stay last year and had a similar issue as OP. I made a few calls to insurance and hospital to see what the issue was. It eventually got paid. I appreciated the care I received and wanted to make sure the hospital was properly reimbursed. Insurance companies often respond more quickly to customers than to doctors/hospitals.
by rkhusky
Mon Mar 25, 2024 6:21 pm
Forum: Investing - Theory, News & General
Topic: Looking for advice on unhappy experience in VG short term bond fund
Replies: 66
Views: 5591

Re: Looking for advice on unhappy experience in VG short term bond fund

Johnnie wrote: Mon Mar 25, 2024 6:16 pm
rkhusky wrote: Mon Mar 25, 2024 6:04 pm Do you own stocks? Stocks have dropped 50% 3 times in the last 50 years. They drop 10% every year or two.
Right, and no-sweat: That's just what I expect with stocks - the "risky" part of my portfolio.
rkhusky wrote: Mon Mar 25, 2024 6:04 pm If you had bought a bond 2 or 3 years ago, you would have locked in a very low rate.
Right again, and if I had bought a bond with a fixed end-date, vs. a bond-fund without one, I wouldn't have any decisions to make now and would take my lumps with no complaint.
I view my portfolio as one big pot. I don’t care how the pieces are doing, as long as the total goes up.
by rkhusky
Mon Mar 25, 2024 6:18 pm
Forum: Investing - Theory, News & General
Topic: Looking for advice on unhappy experience in VG short term bond fund
Replies: 66
Views: 5591

Re: Looking for advice on unhappy experience in VG short term bond fund

RickBoglehead wrote: Mon Mar 25, 2024 6:10 pm
rkhusky wrote: Mon Mar 25, 2024 3:08 pm Funny how people get so disturbed by small drops in bond funds, while holding significant amounts in stocks, which can drop a whole lot more.
Small? VBTLX hit a high in 2020 of $11.77. $9.53 today. Still off 19%.

Been in the market since early 80s. I will take Primecap any day over this. I am putting all earnings into MM and soon treasuries. Done with bond funds.
The stock market has dropped 50% three times in the last 50 years and drops 20% every 3-5 years. Total Bond has dropped 20% once in the last 50 years (and I think you are missing dividends in the above VBTLX numbers).

I remember 0.01% earnings in MM. I am having none of that.
by rkhusky
Mon Mar 25, 2024 6:12 pm
Forum: Personal Investments
Topic: Please help me organize the fixed income part of my portfolio
Replies: 131
Views: 8404

Re: Please hep me organise the fixed income part of my portfolio

Jimsad wrote: Mon Mar 25, 2024 4:28 pm
rkhusky wrote: Mon Mar 25, 2024 4:15 pm
Jimsad wrote: Mon Mar 25, 2024 4:04 pm 401ks with Paychex and tsp and IRA s in vanguard
G Fund in TSP is good, but sort of depends on options in Paychex and whether this is from the current employer or whether you can transfer it to TSP or a tIRA.
Paychex 401k is with current employer

Question off topic- but which one of the following would come closest in comparison to G fund ?

VBTLX
Or
VIPSX
Or
Short term treasuries ?
None. G Fund has special bonds that return like an Intermediate Treasury fund, but don’t go up or down with interest rates. They don’t get inflation adjustments like TIPS. Will return more than short Treasuries with no fluctuations. Will return a bit less than Total Bond with no fluctuations.
by rkhusky
Mon Mar 25, 2024 6:04 pm
Forum: Investing - Theory, News & General
Topic: Looking for advice on unhappy experience in VG short term bond fund
Replies: 66
Views: 5591

Re: Looking for advice on unhappy experience in VG short term bond fund

VG reports my "Cost basis – Unrealized gains/losses" is down 7.08% on this fund. If I owned a bond with a fixed term I would be indifferent to interim volatility. It appears my big bad mistake was to buy a bond fund not a bond. Yeah I should have read the fine print. No-Excuse-Sir, but rates were near-zero then no one was talking about high-4%/low 5% within two or three years. Many seem to assume that rates will be heading down from here. I really didn't want to be investing on the basis of "opinion," but when I look at the current political and geopolitical backdrop the picture I see is if anything "higher for longer." The question is what should I do now, given that no one can predict rates, and if they are ...
by rkhusky
Mon Mar 25, 2024 4:15 pm
Forum: Personal Investments
Topic: Please help me organize the fixed income part of my portfolio
Replies: 131
Views: 8404

Re: Please hep me organise the fixed income part of my portfolio

Jimsad wrote: Mon Mar 25, 2024 4:04 pm 401ks with Paychex and tsp and IRA s in vanguard
G Fund in TSP is good, but sort of depends on options in Paychex and whether this is from the current employer or whether you can transfer it to TSP or a tIRA.
by rkhusky
Mon Mar 25, 2024 3:55 pm
Forum: Personal Finance (Not Investing)
Topic: Income Limits For IRA Contributions
Replies: 12
Views: 718

Re: Income Limits For IRA Contributions

This post is being inspired by another current post of mine regarding backdoor Roth IRAs. So if the same "tax people" see this, thanks for bearing with me, as this is a related but separate question. I'm coming to realize, I think, that income limits for IRA contributions are really income limits for being able to deduct IRA contributions. Right? Can my retired sibling, who has a very high investment income and a spouse who still works, and contributes the max to a small business 401(K), still contribute $7500 for 2023 ($8000 for 2024) to a non-deductible Traditional IRA, then "back door" covert to Roth? I was under the impression that the income limits meant you can't do it but I'm looking for confirmation that you can...
by rkhusky
Mon Mar 25, 2024 3:52 pm
Forum: Investing - Theory, News & General
Topic: Viewing your portfolio vs viewing them as separate components
Replies: 14
Views: 1139

Re: Viewing your portfolio vs viewing them as separate components

View your portfolio as a whole, at the present, and as it glides into the future.

You want each component to be the best it can be in terms of expense ratio, appropriateness for the portfolio, and ease of use, but you should be aware of how the differences affect the overall portfolio. (e.g. I'm not going to shift components to other brokerages to save 5 bp and I'm not going to use an inappropriate fund to save 10 bp)
by rkhusky
Mon Mar 25, 2024 3:08 pm
Forum: Investing - Theory, News & General
Topic: Looking for advice on unhappy experience in VG short term bond fund
Replies: 66
Views: 5591

Re: Looking for advice on unhappy experience in VG short term bond fund

Funny how people get so disturbed by small drops in bond funds, while holding significant amounts in stocks, which can drop a whole lot more.
by rkhusky
Mon Mar 25, 2024 12:47 pm
Forum: Personal Investments
Topic: Please help me organize the fixed income part of my portfolio
Replies: 131
Views: 8404

Re: Please hep me organise the fixed income part of my portfolio

Another thought: stocks have dropped 50% three times in the last fifty years and bonds have dropped 20% once. So, with a 70/30 portfolio, 35% of your portfolio is at risk due to stocks and 6% due to bonds. You should be 6x more concerned about the stocks compared to the bonds. Once your portfolio is at 30/70, there will be equal portfolio risk from stocks and bonds - about 15%.
by rkhusky
Mon Mar 25, 2024 11:46 am
Forum: Personal Investments
Topic: Please help me organize the fixed income part of my portfolio
Replies: 131
Views: 8404

Re: Please hep me organise the fixed income part of my portfolio

Just put all your FI into Total Bond or Intermediate Treasury and you’ll be fine. Add some TIPS if you want some fine-tuning, but it’s not going to help much. Other than that, you are just playing around because you enjoy it.
by rkhusky
Mon Mar 25, 2024 11:01 am
Forum: Investing - Theory, News & General
Topic: Is there any difference between cashing out a Mutual fund in/out of an IRA - if you are retired already?
Replies: 13
Views: 1429

Re: Is there any difference between cashing out a Mutual fund in/out of an IRA - if you are retired already?

Money in your taxable account is taxed every year due to dividend and/or cap gain distributions. Money in your IRA is not taxed until you withdraw it. I prefer to keep money in my IRA's as long as possible (other than moving between accounts, ie Roth conversions).
by rkhusky
Mon Mar 25, 2024 10:56 am
Forum: Personal Investments
Topic: Buying OTC Stocks With VBS
Replies: 26
Views: 1215

Re: Buying OTC Stocks With VBS

I would have been fine with Vanguard staying mutual fund only and not offering stocks or ETF's.
by rkhusky
Mon Mar 25, 2024 10:29 am
Forum: Investing - Theory, News & General
Topic: Vanguard TDF -- Why are there International Bonds?
Replies: 8
Views: 763

Re: Vanguard TDF -- Why are there International Bonds?

I applaud Vanguard for providing research like this. I wonder what research other fund companies, which put a dozen or more funds into their TDF's, use to explain their allocations? (I've seen 20 funds in a TDF)
by rkhusky
Mon Mar 25, 2024 9:17 am
Forum: Personal Investments
Topic: VXUS Dividends showing up as all non-qualified
Replies: 17
Views: 1814

Re: VXUS Dividends showing up as all non-qualified

TropikThunder wrote: Sun Mar 24, 2024 10:41 pm
rkhusky wrote: Fri Mar 22, 2024 11:10 am
Raspberry-503 wrote: Fri Mar 22, 2024 11:06 am On my Fidelity account, dividends show as non-qualified all year and get adjusted for qualified and foreign-tax early in the next year before tax time and reported properly on my 1099
Doesn’t seem very user-friendly to show incorrect information, but all brokerages have little quirks like this that you have to get used to. I think Fidelity might also show capital gains in IRA’s, which is meaningless.
I think it’s less “incorrect” than it is “premature”. Vanguard doesn’t parse out the qualified vs qualified split until the end of the year, so they can’t tell Fidelity what it is before then. If Fido were to estimate and be wrong, I imagine people would be even more irritated.
Saying 0% is incorrect. Saying nothing would be better.
by rkhusky
Mon Mar 25, 2024 8:31 am
Forum: Personal Finance (Not Investing)
Topic: Do I need a buyer's agent when seller is a realtor?
Replies: 69
Views: 5279

Re: Do I need a buyer's agent when seller is a realtor?

Thank you all for your experiences and advices. I have decided to retain my own buyer's agent for the ease of negotiation. I actually called the seller, who is the also listing agent, and inquired about a "direct sale". Very quickly I learned that his ability to talk over me is not something I can comfortably handle. I see the value of having a buyer's agent; how much it's worth is not something I can negotiate yet. Home buying/selling can get very emotional. It's good to have a degree or two of separation in many cases. For our last house, the seller became so upset that she didn't even show up for the closing (did it remotely, even though she was local). I'd say if one is being "talked over," this is not someone to do...
by rkhusky
Mon Mar 25, 2024 8:20 am
Forum: Personal Investments
Topic: Pulled out of Target Fund 2045 to rebalance, more aggressive
Replies: 98
Views: 5644

Re: Pulled out of Target Fund 2045 to rebalance, more aggressive

But I do want to clarify something that you wrote. Duration (At least in the technical sense that I was using it) is NOT the same as the length of time until the bond matures (Except for the unique case of zeros). There is a technical, mathy, definition of duration, but (at least for me) the more meaningful definition is the point of indifference, the length of time after an interest rate change, where I don't care about keeping the original bond (with its terms) or cashing out (taking the capital gain or loss) and then reinvesting the money at the new interest rate (lower or higher). If you hold a bond (and generalizing, bond funds) as long or longer than their duration (remember duration does not mean maturity), the your return is the sa...
by rkhusky
Mon Mar 25, 2024 8:09 am
Forum: Personal Finance (Not Investing)
Topic: Do I need a buyer's agent when seller is a realtor?
Replies: 69
Views: 5279

Re: Do I need a buyer's agent when seller is a realtor?

BetterPaws wrote: Sun Mar 24, 2024 6:41 pm Thank you all for your experiences and advices. I have decided to retain my own buyer's agent for the ease of negotiation.

I actually called the seller, who is the also listing agent, and inquired about a "direct sale". Very quickly I learned that his ability to talk over me is not something I can comfortably handle. I see the value of having a buyer's agent; how much it's worth is not something I can negotiate yet.
Home buying/selling can get very emotional. It's good to have a degree or two of separation in many cases. For our last house, the seller became so upset that she didn't even show up for the closing (did it remotely, even though she was local).
by rkhusky
Mon Mar 25, 2024 7:54 am
Forum: Personal Investments
Topic: Pulled out of Target Fund 2045 to rebalance, more aggressive
Replies: 98
Views: 5644

Re: Pulled out of Target Fund 2045 to rebalance, more aggressive

I am not a fan of “take your risk on the stock side”. I prefer to have investments along the risk spectrum. Although I don’t currently hold high-yield bonds, I see nothing wrong with a small allocation to them. In fact, maybe I should see if it makes sense to add some to my portfolio. I haven’t looked at their yield recently. Did you listen to the Boglehads Podcast Episode 57 - Dr. Horstmeyer ... he mentioned some research where he discussed that High Yield Corporate bonds were a fine investment - comparable returns to S&P on a risk adjusted basis. No free lunch but a decent option. I don't have a problem - in principle - with holding a variety of assets across the risk spectrum. For me it just seem to add more complexity than I care f...
by rkhusky
Sun Mar 24, 2024 8:01 pm
Forum: Personal Investments
Topic: Help me understand the extra work of SpecId for cost basis
Replies: 11
Views: 730

Re: Help me understand the extra work of SpecId for cost basis

The good news is that there’s no particular hassle in using spec ID at Vanguard. The bad news is that you bought all of your shares without having spec ID turned on. When you make the switch I believe you’ll discover that the basis for all of the shares that you already own will be averaged. You’ll get no advantage selling those shares. I’d go ahead and switch anyway for your taxable accounts. Any new purchases, including any reinvested dividends, will have their cost basis tracked separately from now on. Cyclist That bad news is incredibly surprising if true, mainly because it makes little sense. Vanguard has all the data and I can't think of any reason why their system would have this limitation. Cacophony- you are correct. All lots afte...
by rkhusky
Sun Mar 24, 2024 6:52 pm
Forum: Personal Investments
Topic: How quickly can I liquidate a mutual fund at Vanguard to my linked bank account?
Replies: 9
Views: 1269

Re: How quickly can I liquidate a mutual fund at Vanguard to my linked bank account?

I've recently sold VUSXX and had it show up at my bank the next day. My bank has been advertising early deposits for things like direct deposits and transfers from brokerages. Took 1 day off the former time frame.
by rkhusky
Sun Mar 24, 2024 4:18 pm
Forum: Personal Investments
Topic: Pulled out of Target Fund 2045 to rebalance, more aggressive
Replies: 98
Views: 5644

Re: Pulled out of Target Fund 2045 to rebalance, more aggressive

Correction. Bonds GAVE you less volatility. Past tense. There is no guarantee that Total Bond WILL give you 5% for many years. Same with stocks. No one stopping you from investing in Total Bond, but I will oppose its peddling as "safe" or even "less volatile" choice. It is neither. Total Bond Fund will be less volatile than Total Stock Market over any time period you care to name. 2021 to till date. Stocks returned 10% and total bond fund returned negative 11%. Sortino ratio, which is the measure of volatility is 0.75 for stocks versus -0.99 for bonds. Worse than stocks. You use standard deviation to measure volatility. Sharpe and Sortino ratios are used for risk-adjusted return. 2021 - present, per PV, SD for Total Sto...
by rkhusky
Sun Mar 24, 2024 4:09 pm
Forum: Personal Investments
Topic: Pulled out of Target Fund 2045 to rebalance, more aggressive
Replies: 98
Views: 5644

Re: Pulled out of Target Fund 2045 to rebalance, more aggressive

Correction. Bonds GAVE you less volatility. Past tense. There is no guarantee that Total Bond WILL give you 5% for many years. Same with stocks. No one stopping you from investing in Total Bond, but I will oppose its peddling as "safe" or even "less volatile" choice. It is neither. Total Bond Fund will be less volatile than Total Stock Market over any time period you care to name. 2021 to till date. Stocks returned 10% and total bond fund returned negative 11%. Sortino ratio, which is the measure of volatility is 0.75 for stocks versus -0.99 for bonds. Worse than stocks. You use standard deviation to measure volatility. Sharpe and Sortino ratios are used for risk-adjusted return. 2021 - present, per PV, SD for Total Sto...
by rkhusky
Sun Mar 24, 2024 12:58 pm
Forum: Personal Investments
Topic: Pulled out of Target Fund 2045 to rebalance, more aggressive
Replies: 98
Views: 5644

Re: Pulled out of Target Fund 2045 to rebalance, more aggressive

I reject a binary choice. I don’t want that much volatility. Bonds give me less volatility and higher return. Total Bond could return 5% for many years. Correction. Bonds GAVE you less volatility. Past tense. There is no guarantee that Total Bond WILL give you 5% for many years. Same with stocks. No one stopping you from investing in Total Bond, but I will oppose its peddling as "safe" or even "less volatile" choice. It is neither. Total Bond Fund will be less volatile than Total Stock Market over any time period you care to name. 2021 to till date. Stocks returned 10% and total bond fund returned negative 11%. Sortino ratio, which is the measure of volatility is 0.75 for stocks versus -0.99 for bonds. Worse than stocks...
by rkhusky
Sat Mar 23, 2024 8:58 pm
Forum: Personal Investments
Topic: Pulled out of Target Fund 2045 to rebalance, more aggressive
Replies: 98
Views: 5644

Re: Pulled out of Target Fund 2045 to rebalance, more aggressive

lakpr wrote: Sat Mar 23, 2024 6:31 pm
rkhusky wrote: Sat Mar 23, 2024 6:18 pm I reject a binary choice. I don’t want that much volatility. Bonds give me less volatility and higher return. Total Bond could return 5% for many years.
Correction. Bonds GAVE you less volatility. Past tense. There is no guarantee that Total Bond WILL give you 5% for many years.

Same with stocks.

No one stopping you from investing in Total Bond, but I will oppose its peddling as "safe" or even "less volatile" choice. It is neither.
Total Bond Fund will be less volatile than Total Stock Market over any time period you care to name.
by rkhusky
Sat Mar 23, 2024 6:18 pm
Forum: Personal Investments
Topic: Pulled out of Target Fund 2045 to rebalance, more aggressive
Replies: 98
Views: 5644

Re: Pulled out of Target Fund 2045 to rebalance, more aggressive

You still have higher volatility with the 70/30 portfolio and similar under-performance from 2001-2021. I see no reason to lock up substantial money in low-yield investments that aren't going to be withdrawn for 20-30-40 years. Intermediate bonds are quite safe in that time frame. If you want to start gliding down to MM 5 years before retirement, that would make more sense. The idea of keeping 30% of the investment in "safe" assets is for dry powder. Re-deploying to stocks when they are down. I don't know how to incorporate that into portfolio visualizer, where if the stocks are down 20% or more pretty much liquidate the entire "safe" assets to plow into stocks. If one is definitely investing for 20-30-40 years, AND you...
by rkhusky
Sat Mar 23, 2024 5:48 pm
Forum: Personal Investments
Topic: Pulled out of Target Fund 2045 to rebalance, more aggressive
Replies: 98
Views: 5644

Re: Pulled out of Target Fund 2045 to rebalance, more aggressive

I dont see that. The underperformance is $300, so $30 per year. https://www.portfoliovisualizer.com/backtest-portfolio?s=y&sl=IWCt6lcu0z0zYZogEr72L I was talking about your previous plot: Annual Rebalancing I guess the under-performance was for a longer period. Cumulative under-performance from 1993 looks like about even in 2001, -7% in 2003, -6% in 2008, -13% in 2010, -14% in 2012, -12% in 2015, -10% in 2018, -9% in 2021. That's a long time to have double digit under-performance. I was mistaken about the $20K underperformance, it looks more like $10K (if you get rid of the Balanced Fund comparison, you can go back to 1987, and then you see $20K under-performance). 2001 - 2012 looks like the biggest drop in comparable performance, abou...