When Is It Unethical To Accept A Free Lunch With A Financial Planner? My brother, a veterinarian, once calculated the cost of a free puppy for his 4-H advisees. It was not trivial, but you received unconditional love.
If you don't have a 15 year life expectancy, don't get a free puppy (or a pure bred, if that's your fancy); but, if there's no free puppy, why do you anticipate a free lunch?
If you are smarter than the presenter, why go? How many follow up calls can you endure?
If you not smarter than the presenter, go to more free lunches and select the best presentation. At least you got lunch.
Separately, the lady for whom I am power of attorney has somewhat more than $1M, which will rapidly transfer to her assisted living owners. When I asked her BOA local office about investment vehicles, they referred me to their Merrill Lynch office at a different site, where they advised me that they usually didn't accept clients with less than $3M assets, but they might make a few suggestions on her behalf.
While this may seem irrelevant, the point is that you had better get EVERYTHING in order while you have capacity, because your powers of attorney will face a daunting challenge to do their best for you.
If there is a POA thread, send me to it.
Vanguard Target Fund Contemplation The actively managed funds require $50K, but I'm not sure about the index funds. If you can access the index funds directly, do so, but you might want to keep enough in the target fund to allow you access to their allotments, so you could rebalance yearly.
David Snowball's May Commentary (5/4 update) @Ben.
The MFO Risk is relative max volatility (of STDEV, DSDEV, Ulcer) versus that of SP
500 ...
POPFX is still an equity fund. But, of those, it has about as low a volatility as it gets without holding large cash or bond allocation.
c
Vanguard Target Fund Contemplation @Maurice, It sounds like a workable solution that may save you on the management fee. The Admiral shares of most Vanguard index funds require $
50K. So a total of $200K would allow you to construct the same portfolio as the Target date fund and perform rebalancing periodically.
DSENX For sure with its automatic monthly 'value churn', CAPE should underperform SP500 at times, and certainly has recently.
As for the effects of the bond sauce, which are not large, I get the following, rounded, total (unless I'm reading my calculator wrong, always a possibility):
ytd - underperforming CAPE by 0.6%
1y - underperformed CAPE by 0.7%
2y - outperformed CAPE by a thin hair
3y - underperformed CAPE by 0.7%
4y - outperformed CAPE by 1%
4.5y (since inception) - outperformed CAPE by 2.6%
DSEEX better than the above, of course, but the last year and ytd it lags CAPE too.
It appears the ER-covering bond sauce is getting staler.
Yes, M* appears to have the style box wrong.
>> investing in ... price movements of an index or indices which have expiration dates, and the ability of a management team to maneuver within the volatility of those expiration dates.
Huh. Is that a useful way to characterize it?
DSENX @DerfFor the 1 year period:
DSENX = +10%
CAPE = + 10.8%
JKF = +8.
5%
JKF is by no means a pure compare for the other 2; but gives a reference point if one were invested in large value index type.
I imagine there exists any number of configurations for large value indexes.
I "see" only the
5 digit tickers are currently highlighted and clickable.
*****JKF The iShares Morningstar Large-Cap Value ETF seeks to track the investment results of an index composed of large-capitalization U.S. equities that exhibit value characteristics.
DSENX
DSENX @msf and
@MikeM Thanks for the replies. I may be contradicting myself by saying this, but I don't make sector bets. Perhaps mistakenly, I treat DSENX as a core holding and that's why I compare its performance to the S&P
500 or a domestic multi-cap core index fund holding (VTI, in my case) Time for me to decide whether I want to get out of the LV (with a bond component) sector
Target date Funds & Buffett Hold S&P
500 for 10 years...20 years...not 10-20 minutes
“The S&P 500 Index Fund is the one to use. That’s the one I used in that bet I made for ten years. It’s the one I’ve told the trustee for my wife to put 90% of the funds I leave her in to.”
90% of investors should hold index funds...the rest should own BHK-B (hard to afford A shares). BHK-B stock is like a concentrated fund with no ER.
DSENX @Bitzer, it's bench mark is large value, not the S&P
500. Against it's benchmark, the LV category, it is not performing poorly. Seems LV may be taking a pause right now with higher than normal valuations.
DSENX One can decompose DSENX into three components:
1) CAPE
2) Bond fund + leveraging costs (i.e. cost of getting the roughly 100% extra cash to buy the bonds)
3) ER
Over the past year, DSENX has underperformed CAPE by about 0.75%. (CAPE in turn has underperformed the S&P 500 by about 3% - others can look into that.)
Intermediate term bonds have returned virtually nothing over the past year. While one can't easily say how PIMCO is managing its bond sleeve, that at least gives us a ballpark sense of the bond market. Subtract off leveraging costs, and it's easy to see where this fund could lose a percent or even a couple from its bonds.
Add another 0.4% cost above that of CAPE, and altogether it's not hard to see this fund underperforming CAPE by 0.75% (at least), which in turn underperformed the S&P 500 by 3%.
DSENX Update on my October, 2017 post For the past year, DSENX's performance lags the S&P 500 by 3.66%, as measured by Lipper. Again, the S&P 500 may not be a fair comparison and I'm not going to make a sell decision on one year's performance, but can anyone offer some guidance as to why DSENX has been performing so poorly lately and whether it may outperform again due to a reversal of whatever circumstances that has caused it to recently underperform? Thanks!
Fidelity Employees Fired After Alleged Misuse Of Reimbursement Programs
David Snowball's May Commentary (5/4 update) We've posted a (rare) mid-cycle addition to our May issue. Ed Studzinski reflects on the lessons of Showtime's
Billions and on the imperative for traditionally successful investment managers to regain their edge in a world where the market for funds has fundamentally changed.
Rolling down the Appian Way.
David
Morgan Stanley Fund Sticks With Asian Stocks, Thanks To Warren Buffett: (MGGPX)
M*: Funds That Buy Like Buffett, 2018 FYI: This coming Saturday, May
5, Omaha, Nebraska will host the event sometimes referred to as "Woodstock for Capitalists": the annual Berkshire Hathaway (BRK.B) shareholder meeting, led by chairman Warren Buffett and vice chairman Charlie Munger. (For those who can’t make it in person, the meeting will be livestreamed.) That means it's time for our annual look at the mutual funds with the biggest stakes in the stocks held in Berkshire Hathaway's investment portfolio, as listed in Buffett's annual letter to shareholders and in Berkshire's annual report.
Regards,
Ted
https://www.morningstar.com/articles/863186/funds-that-buy-like-buffett-2018.html
The Apple Of Warren's Eye
Type of IRA - Simple vs Traditional vs Rollover Forget about SIMPLE and SARSEP - those are employer-sponsored IRAs.
Pretax or post-tax, you made it clear that the money you have is in traditional IRAs, not Roths. You keep track of that with
8606 forms.
Rollover IRAs are something of a hack. They're just traditional IRAs containing money that originally came from an employer plan. They are there to help trace where the money came from.
This used to be a big deal because your new employer's 401K plan might only accept money that originally came from another 401k plan, not a "regular" IRA. (If you were born before 1937 there were also tax benefits.) It's less important now.
Currently, the main reason to "tag" money as coming from an employer plan is that in bankruptcy court, you get unlimited protection for 401k money and money that originally came from 401(k)s. Keeping this money segregated, with or without tag, "will facilitate the ease of tracking and proving which IRA assets are attributable to protected rollover contributions and growth thereon."
Kitces,
Credit Protection for Retirement Accounts.
Aside from helping you know which money came from 401k's if you ever go through bankruptcy, the "Rollover" moniker doesn't serve much useful purpose any more. It's just a "traditional" IRA.
Here's an Ed Slott forum post that says all of this more clearly and concisely:
https://www.irahelp.com/forum-post/18141-traditional-ira-vs-rollover-ira
Who should own the 529 accounts? Help greatly appreciated. Hi catch! Thanks for additional info. To answer, the 529 accounts are in my name as owner only. The IRS permits one owner, so if I transfer ownership it will go to only one parent of each kid.
The computer stuff is interesting...it looks like the IRS knows nobody but nobody goes to school without a machine. How they would know if little Johnny accesses something, cough, cough, 'amusing and entertaining' is beyond me though
