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abagofcheetos posted:For those that advocate index fund portfolios, is there any reason why you wouldn't simply select all 2x or 3x or 100x (I guess they don't exist... yet) bull funds instead of just the regular indexes? This is actually a drat good question. I second this question.
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# ¿ Jul 10, 2008 03:01 |
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# ¿ Mar 29, 2024 08:06 |
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I'll be starting a Roth IRA soon for retirement purposes and I want you guys to critique the portfolio I'm thinking of creating: 45% Vanguard Total Stock Market 45% Vanguard Total International Stock Market 10% Vanguard Total Bond Market Index As you can see, it has a 90/10 equity/bond allocation. I dislike the Target Retirement funds offered by Vanguard (as well as other fund families) because they have really low international exposure. Also, I like to keep the number of funds to a low number.. I don't want a portfolio of 10 funds. I have a question as well: What do you guys think about a High Yield bond fund in place of the Total Bond Market fund? I assume it would probably be worse over the long run.. high yield bonds seem to be more correlated with the equity market.
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# ¿ Jul 13, 2008 22:43 |
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Modern Life Is War posted:Stuff Yeah, but what's the alternative, dude? What do you suggest? That the average person should save nothing for retirement and just work until death?
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# ¿ Jul 14, 2008 01:21 |
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Unormal posted:Like you say, high yield bonds tend to correlate with equities; Your original portfolio looks perfectly fine to me. You might consider a slice of REIT exposure as well. How about.. 40% Total Stock Market 40% Total International Stock Market 10% Total Bond Market 10% REIT Index Should I even worry about adding commodity funds to my retirement portfolio?
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# ¿ Aug 2, 2008 23:59 |
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Unormal posted:You should consider reading up on some of the books mentioned in this thread and others. If investing seems complex, it's because someone (an advisor? an unknowledgable family member?) is making it seem more complicated than it really is. You really can do your own investing without paying anyone else a fee. You have more than enough time to just do the research and learn to do it on your own, it will pay dividends (both literally and figuratively). Yes.. this. I'm working as an assistant to a fairly successful financial planner and let me just tell you that I wouldn't feel comfortable with any of the financial planners at my office handling my investment portfolio. It's not that all financial planners are greedy -- well, some are greedy.. but even the good ones can't do anything with your investment accounts that you can't do yourself. Not to mention that a financial planner will probably be sucking 1% a year from your portfolio without doing much in return. It is much easier and much cheaper to build a diverse portfolio of index funds for your IRA then it is to pay a 1% a year to a planner that will just dump you into a bunch of stupid rear end random funds.
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# ¿ Aug 8, 2008 04:16 |
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enraged_camel posted:I see. I think the only "lovely" thing about Vanguard funds is that they all pretty much require a $3,000 minimum investment, whereas Charles Schwab funds have a $100 minimum. The lower minimums might be beneficial if you find it difficult to save up huge chunks of cash. The Vanguard funds are still "better" though, because of the lower expense ratios.
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# ¿ Sep 19, 2008 08:21 |
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KS posted:I thought the prevailing wisdom was that the target retirement funds weren't so hot. Looking at Vanguard's, the 2045 retirement fund has 10+% of its assets in bonds. Isn't that a bit conservative? At least the expense ratio is low, and it is essentially just like putting 70+% of your money into an index fund, but I can't help thinking there are better options. The only real problem with Vanguard's target retirement funds is that they all have fairly low international exposure; the TR 2050 fund only has about 18% international exposure. The Vanguard TR funds are still pretty decent though, for what they are.
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# ¿ Sep 25, 2008 05:46 |
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80k posted:stuff 80k, you always have some interesting viewpoints. What is your recommended asset allocation for a young person's retirement account? I know you are a bit more "into" bonds than what is the norm.
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# ¿ Sep 26, 2008 06:14 |
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80k posted:more stuff I agree with 90% of what you just said, especially the part about most people not having the guts to hold steady during troubled times with a faltering equity-heavy portfolio. I have a question about TIPS. I want your thoughts, 80k. Everybody knows that TIPS are adjusted based on inflation, or more specifically the CPI. I am rather concerned with the eternal debates/arguments over whether or not the CPI levels are accurate; tons of people yap on and on that the CPI levels are often understated. Is this conspiracy theory or is somewhat true? If the CPI levels are understated, doesn't that mean TIPS are largely useless since the return will be lower than the "real" inflation rate?
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# ¿ Sep 27, 2008 17:38 |
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80k posted:OK, when did Vanguard release this gem? VTWSX (Total World Stock Index)? Looks like a cap-weighted global index fund containing both US and international stocks. $3,000 minimum. Speaking of VTWSX: What is your opinion of using VTWSX to replace both VTSMX (Total Stock Market) and VGTSX (Total International Stock Market) in a portfolio? I think consolidating those two funds in VTWSX is much easier in that you'd only need $3,000 to get going instead of $6,000. It is pretty much like going 50/50 domestic/foreign.
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# ¿ Sep 27, 2008 17:44 |
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devilmouse posted:stuff You don't need to use a financial planner unless you have a great deal of wealth; a financial planner won't really be able to do anything for you besides take your money. Don't let some rear end in a top hat charge you a 1%+ fee for something you could easily do yourself. I would say yes, opening a Roth IRA would be a good first step. Max it out every year. I (and probably everybody else on this forum) would recommend opening a Roth IRA through Vanguard and building a solid portfolio of index funds or a retirement fund. Vanguard's Target Retirement Funds are decent if you don't want to spend too much time learning about investing; the Target Retirement Funds aren't perfect but they get the job done if you just wanna put your retirement money on auto-pilot without worrying too much.
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# ¿ Sep 28, 2008 16:16 |
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Modern Life Is War posted:http://www.shadowstats.com/ This website is confusing as gently caress.
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# ¿ Sep 28, 2008 16:20 |
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Hey 80k: What's your stance on having REIT exposure in one's retirement portfolio? Yay or nay?
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# ¿ Sep 28, 2008 18:38 |
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kys posted:What would be the best investment when it comes to Buy and Hold? Currently, I have all my Roth IRA in the S&P Index fund and even though its fine now, I'll eventually have to diversify in order to not get hosed. A ton of mutual fund families/brokerages offer life cycle or target retirement funds. I think Vanguard's target retirement funds are probably the "best" because the expense ratios are extraordinarily low (I think 0.22% or something like that). The Target Retirement funds aren't perfect, but they are an excellent choice if you want to put your retirement money on autopilot.
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# ¿ Oct 31, 2008 16:20 |
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Chachikoala posted:I am opening up a ROTH IRA for the first time and I have had the 5k from last year sitting in an ING savings account. If I open the account now, and put that money in, does that count as my 2008 contribution or my 2009 contribution? You can "backdate" your contributions to the previous year as long as you do it before April.
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# ¿ Jan 17, 2009 07:08 |
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80k: What do you think of a 2-fund/ETF portfolio? I'm thinking VT (Vanguard World Stock ETF) and a bond ETF. I'm trying to minimize the number of funds/ETFs in my portfolio, so I won't be paying so much in transaction fees. Which bond ETF do you think I should go with?
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# ¿ Jan 20, 2009 01:12 |
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Unormal posted:You could also just use a TR fund, and then you just have 1! True, but I don't really like Target Retirement funds. I have yet to see a TR fund that has more than 20% foreign equity exposure.
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# ¿ Jan 21, 2009 08:57 |
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Attention 80k, I've got a few more questions for you: 1. What online broker do you use? What do you think of Scottrade? I'm looking for an uber-cheap (but not disreputable/lovely) discount broker. Do you know anything about rock-bottom cheap brokers like Zecco and Tradeking? If so, do you like them? 2. What is your opinion of directly buying bonds (opposed to buying bond ETFs/mutual funds)? Is there an advantage of doing so? Ravarek fucked around with this message at 12:27 on Jan 25, 2009 |
# ¿ Jan 25, 2009 12:16 |
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80k posted:Raverek, What did you think of Firstrade?
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# ¿ Jan 26, 2009 08:54 |
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Koirhor posted:So I went ahead and opened a Roth IRA with Vanguard The Target Retirement Fund is decent if you just want to set your retirement money on auto-pilot.. Target Retirement funds aren't perfect, but they get the job done. However, I do think the Vanguard STAR fund is somewhat lovely; the STAR fund is pretty much a diarrhea of a dozen other (seemingly random) Vanguard funds. I suggest moving your money out of the STAR fund and throwing the $1,000 into the TR 2050 fund.
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# ¿ Jan 27, 2009 21:04 |
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80k, I have a philosophical question for you.. While I agree with common wisdom that the equity exposure in one's portfolio should include a portion of international stocks, I sometimes feel that international stocks don't really offer a diversification benefit to an investor's portfolio. Allow me to be more specific: it seems that the returns of any broad-based international index are highly correlated to the returns of the U.S. stock market. While a lot of people seem to think that international equities provide a diversification benefit, I see international stocks as a simply more aggressive asset sub-class of equity. It seems to me that commodities (which are often looked down upon) serve more of a diversification purpose than international stocks. What are your thoughts on this matter? Do you think international stocks offer a diversification benefit (i.e. lower the overall beta in one's portfolio) or do you think international equity serves another purpose in one's portfolio?
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# ¿ Jan 30, 2009 21:43 |
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80k posted:stuff As always, 80k, your responses are very insightful. While I do agree with you that the equity exposure in one's portfolio should include a lot of international stocks (40%+), I still feel that broad-based international indices are still highly correlated with the U.S. stock market.. at least for now, with the U.S. still the "dominant" force in the world. However, I do think things will change if the U.S. slips from economic superpower status. What are your thoughts on commodity ETFs (gold, oil, silver, etc.)? Do you think individual investors should stay away from them?
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# ¿ Feb 1, 2009 21:12 |
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Hey 80k, Do you buy individual stocks or do you use funds/ETFs for your equity exposure?
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# ¿ Apr 24, 2009 22:12 |
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filo posted:I have a bunch of money sitting in my fidelity cash reserves right now. When do I throw it into mutual funds? I see the market is down substantially today and although I won't need to retire anytime soon, I'd rather not loose a large chunk of my principle by jumping on the rollercoaster when it seems there might be a lot more ups and downs coming soon. I know this is a ridiculously open-ended question and no one can predict the future but I'd be happy to hear your thoughts. Don't try to time the market. As already stated by Unormal, there will always be volatility in the market. There will always be something on the horizon that may cause "a lot more ups and downs." Don't worry about it. Besides, the worst time to invest is when everybody thinks the market is completely safe.
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# ¿ Jun 18, 2009 03:32 |
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Hey 80k, What's your opinion on holding international bond ETFs in one's portfolio?
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# ¿ Oct 23, 2009 00:38 |
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80k posted:I've been interested in WIP (which is global inflation-linked bonds), except I believe it has some emerging market bonds in there which I am not too keen on. Thanks for the response. I was also looking at WIP. That being said.. Do you feel international bonds provide a diversification benefit to one's portfolio?
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# ¿ Oct 23, 2009 23:58 |
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80k: Do you have any recommendations for a corporate bond ETF?
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# ¿ Oct 30, 2009 01:09 |
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Hey 80k, You buy individual bonds, right? How many bonds do you usually hold at a given time?
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# ¿ Nov 11, 2009 02:02 |
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BTW, 80k, I don't know if you know this: Vanguard JUST released a few more bond ETFs. Pretty cool.
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# ¿ Nov 23, 2009 17:59 |
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MrBigglesworth posted:Anyone know whats with Ally's constantly daily changing interest rates for their online savings account? It may have something to do with the fact that Ally Bank is really a unit of GMAC (General Motors Acceptance Corporation), which is still begging the U.S. government for more bailout money.
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# ¿ Nov 26, 2009 15:48 |
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alreadybeen posted:Right now I am thinking about adding more to the international stock fund in my IRA. But was wondering if you goons had any other ideas or funds I should look into. Your aggregate international exposure is 30% or so. IMO, you would probably benefit from some more international equity exposure (my own portfolio is about 50% international). You may want to consider VFSVX if you want small cap international equity exposure. The reason I mention this is because your current international funds (VGTSX and VEMIX) are pretty much large-cap only. Also, I would probably add some more bond exposure. Sure, common wisdom is that you should overweight equities like a motherfucker if you are young, but adding some more bond exposure can decrease your portfolio volatility without really goosing your expected returns. Not only that, but most people really underestimate the risks associated with an (almost) all-equity portfolio.
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# ¿ Dec 25, 2009 06:09 |
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80k posted:Using stale limit orders with the hope of getting a better price than the current market price can work against you. Market makers treat them like free put options. Is this true? Holy gently caress. This sounds extremely unethical to me.
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# ¿ Dec 29, 2009 05:05 |
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Hey 80k, How much REIT exposure would you say is reasonable for a retail investor?
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# ¿ Jan 1, 2010 19:11 |
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80k posted:
Are you referring to the huge wave of mortgage resets coming in the next year?
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# ¿ Jan 3, 2010 15:47 |
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abagofcheetos posted:80k, I would probably take that bet with you on FAIRX, that fund just seems unstoppable. People said the same thing about Ken Heebner's CGM Focus Fund, before it crashed and burned last year.
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# ¿ Jan 15, 2010 04:05 |
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Anyone have any personal recommendations for a broad-based commodity ETF?
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# ¿ Jan 16, 2010 04:11 |
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DreadCthulhu posted:Out of curiosity, what's the general consensus on holding preferred stock of too-big-to-fail companies such as Bank of America and just milk the dividends? In my opinion, an individual investor shouldn't bother with preferred stock. Hybrid securities do not really provide much diversification to one's portfolio. I think it would be better to just invest in common equities (domestic and foreign) and high-grade debt.
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# ¿ Feb 23, 2010 06:27 |
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Does anyone know where I can find historic ratios for the most widely-used indices? I'm trying to find the P/E ratio of the S&P 500 (and other indices) at certain points in time.
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# ¿ Mar 6, 2010 04:44 |
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Vice President posted:I'm finally going to transfer my IRA away from Chase, who sucked it in after they bought out my bank. They want to charge me a $75 fee to transfer it. Is there any way to escape this dickery, or to convince Vanguard to pick it up for me? A lot of brokerage houses impose "transfer out" fees in order to lock in clients. You might be able to get this fee redeemed by your new broker if you have a big account. If you have a small account, say a few thousand dollars, you pretty much have to eat the fee.
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# ¿ Mar 20, 2010 02:54 |
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# ¿ Mar 29, 2024 08:06 |
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Medikit posted:I recently started a Roth IRA. I'm heavily invested in Bonds as I plan to use some of it for downpayment on a house in the next 10 years. Well, interest rates are rising (albeit slowly) as the economy recovers. Rising interest rates will knock down bond prices; interest rates and bond prices have an inverse relationship. VFSTX will be affected negatively by rising interest rates. HOWEVER, it is worth mentioning that because VFSTX is a short-term bond fund with a low "duration", your losses will be pretty minor. Because you won't need your money for at least a few years, you are essentially "immunized" against a rising interest rate environment. You are pretty safe.
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# ¿ Apr 15, 2010 04:00 |