Are all other business podcasts selling something of their own? Did the S&P 500 return 0% for 34 years? A tool to help get the answer. I give away a copy of Index Funds – The 12-Step Program for Active Investors. Smackdown is now a word.
I ENCOURAGE you to Download this show thru iTunes!
But, if you just can’t possibly deal with that then go ahead and
Play the new show right now
The Mad Money Machine is proud to be sponsored by Index Funds Advisors at ifa.com.
Email me: feedback at Mad Money Machine dot com, or comment, or Call me on the Mad Money Machine voicemail line at 206-734-4763
Dictionary’s new words include “Smackdown”.
We loaded up on Rt11 potato chips, to the detriment of my BMI.
Do you pay cash for gas? How in the world do you get the thing to stop exactly on the dollar?
I have a new appreciation of artistic creations.
The IRS get 7% and 8% interest!
Bob emails me and finds it ironic that I bash Cramer for spending time doing homework when I am doing so much homework in doing this podcast and blog.
Our tool this time helps answer Nevarda and Yomomma2000’s questions.
The book Index Funds: The 12-Step Program for Active Investors has charts showing the distribution of gains in the S&P 500 over days and months. Also, the distribution of 5 dice rolled. Looks pretty much the same doesn’t it?
I’ll get back to you on The Black Swan.
I play lots of other callers to the MMM voicemail line at 206-734-4763
I give away a copy of the big book!
The IFA Risk Capacity survey is upgraded and now has only 25 questions!
Music from music.podshow.com:
ALTA PLAZA – XRAY DOGS
The Ocean – Lez Zeppelin
Taxes – Nashville Session Players
Runaway Train – Under Feather
Sun, July 15 2007 » Podcasts » 2 Comments
ravjim asked, and I hereby answer: how would the do-it-yourself portfolio from show 59 have stacked up against the lazy portfolios?
So, here’s the portfolio I constructed of Vanguard (and one Bridgeway) funds to try to match the IFA Indexfolio 100:
| VFINX |
Vanguard 500 Index |
12.00% |
| VIVAX |
Vanguard Value Index |
12.00% |
| VISVX |
Vanguard Small Cap Value Index |
20.00% |
| BRSIX |
Bridgeway Ultra-Small Company Market |
20.00% |
| VGSIX |
Vanguard REIT Index |
5.00% |
| VTRIX |
Vanguard International Value |
9.00% |
| VINEX |
Vanguard International Explorer |
9.00% |
| VEIEX |
Vanguard Emerging Mkts Stock Idx |
13.00% |
You can compare that against the IFA Indexfolio 100 to see how I tried to capture each asset class.
And here is how the performance compares:
|
YTD |
1.5 Years Annualized |
2.5 Years Annualized |
| Indexfolio 100 |
9.60% |
21.57% |
17.44% |
| Do-it-yourself Portfolio |
7.63% |
19.64% |
16.54% |
The conclusion must be that when you allow Index Funds Advisors to help you, you get a twofer: help, and better returns.
Sat, July 14 2007 » Blog » 2 Comments
Win a copy of the big book: Index Funds: simply comment in the show notes. The Infinity Razor! Lazy Portfolios performance reviewed. Our Guru knows about being lazy. Who will win the CNBC stock-picking challenge (after they throw out all the cheaters)?
I ENCOURAGE you to Download this show thru iTunes!
But, if you just can’t possibly deal with that then go ahead and
Play the new show right now
The Mad Money Machine is proud to be sponsored by Index Funds Advisors at ifa.com.
Email me: feedback at Mad Money Machine dot com, or comment, or Call me on the Mad Money Machine voicemail line at 206-734-4763
Read about Stock Pickers and Coin Flippers.
Is the Infinity Razor really designed to last for all infinity?
For Satan finds some mischief still for idle hands to do. “Against Idleness and Mischief,” by Isaac Watts.
I review the first half performance of the Lazy Portfolios.
Our Guru knows a thing or two about being lazy.
PLEASE NOMINATE THIS SHOW FOR BEST BUSINESS PODCAST AT PODCASTAWARDS.COM!
Who will win the CNBC stock picking challenge?
Take the Risk Capacity Survey at IFA.com!
Comment for your chance to win Index Funds: The 12-Step Program for Active Investors.
Music from music.podshow.com:
Alta Plaza – XRAY DOGS
Lazy Loser – Lima Charlie
Sat, July 7 2007 » Podcasts » 20 Comments
Here’s a summary of how the “Lazy Portfolios” have done in the first half of 2007. I will provide more detail of the makeup of each portfolio here and on the podcast. I also show each portfolio’s annualized performance for the previous 1.5 and 2.5 years.
NOTE THAT THESE ARE THE EQUITY ONLY PORTIONS OF EACH PORTFOLIO. I REMOVED THEIR BOND COMPONENT (IF ANY).
|
|
Annualized |
Annualized |
| Lazy Portfolio |
1st half 2007 |
Since 12/31/05 |
Since 12/31/04 |
| Ted Aronson’s Lazy Portfolio |
10.59% |
20.48% |
19.09% |
| IndexFolio 100 |
9.60% |
21.57% |
17.44% |
| Andrew Tobias’ Lazy Portfolio |
9.52% |
20.79% |
16.81% |
| Scott Burns’ Margarita Portfolio |
9.52% |
20.79% |
16.81% |
| IndexFolio 95 |
9.16% |
21.46% |
17.34% |
| IndexFolio 90 |
8.71% |
21.35% |
17.23% |
| William Bernstein’s Basic No-Brainer Portfolio |
8.64% |
18.53% |
14.58% |
| Merriman Vanguard Equity |
8.25% |
21.92% |
18.56% |
| Paul B. Ferrell’s WisdomTree Portfolio 1 |
8.22% |
– |
– |
| Bill Schultheis’ Coffeehouse Portfolio Three ETF |
7.95% |
20.14% |
– |
| Scott Burns’ Six Ways from Sunday Portfolio |
7.71% |
21.09% |
20.78% |
| Scott Burns’ Couch Potato Portfolio |
7.10% |
15.24% |
11.43% |
| William Bernstein’s No Brainer Cowards Portfolio |
6.85% |
18.72% |
15.56% |
| Frank Armstrong’s Ideal Index Portfolio |
5.84% |
15.95% |
13.06% |
| Ben Stein 2007 |
5.60% |
17.06% |
14.46% |
| Bill Schultheis’ Coffeehouse Portfolio Vanguard |
5.21% |
18.18% |
14.40% |
| Bill Schultheis’ Coffeehouse Portfolio ETFs |
4.70% |
17.98% |
13.56% |
| John Wasnik’s Nano Investment Portfolio |
4.38% |
19.72% |
16.27% |
| David Swensen’s Lazy Portfolio |
4.32% |
18.64% |
15.37% |
| Scott Burns’ Five Fold Portfolio |
3.86% |
19.21% |
16.00% |
| Scott Burns’ Four Square Portfolio |
3.86% |
19.21% |
16.00% |
| Ben Stein Retirement |
-1.69% |
15.13% |
12.34% |
|
|
|
|
| Index |
|
|
|
| S&P500 |
5.97% |
13.18% |
8.99% |
| DOW |
7.59% |
16.11% |
9.11% |
| NASDAQ |
7.79% |
11.69% |
7.44% |
Here is the detailed holdings of each portfolio. The 3rd column is the original portfolio percentage including bonds. The last column shows the equity weightings without bonds.
|
|
|
|
| |
Symbol |
% Allocation |
% Equity Only |
| WisdomTree |
|
|
|
| DTD |
WISDOMTREE TTL DIV |
15% |
15% |
| EXT |
WisdomTree Total Earnings Fund |
15% |
15% |
| DHS |
WISDOMTREE H-Y EQ TR |
10% |
10% |
| DTH |
WISDOMTREE DIEFA HY |
10% |
10% |
| DKA |
International Energy Sector |
10% |
10% |
| DPN |
International Consumer Non-Cyclical Index |
10% |
10% |
| EZY |
WisdomTree Low P/E Fund |
10% |
10% |
|
TOTAL |
100% |
100% |
|
|
|
|
|
|
|
|
| Ben Stein 2007 |
|
|
| VTI |
Vanguard Total Stock Market ETF |
35% |
35% |
| EFA |
ISHARES MSCI EAFE FD |
20% |
20% |
| EEM |
ISHARES MSCI E.M.I.F |
10% |
10% |
| ICF |
ISHARES COHEN & STEERS REALTY |
10% |
10% |
| IWN |
ISHARES RUSSELL 2000 VALUE INDEX FD |
10% |
10% |
| Cash |
|
15% |
15% |
|
TOTAL |
100% |
100% |
|
|
|
|
| Ben Stein Retirement |
|
|
| RWR |
DJ Wilshire REIT ETF |
50% |
50% |
| DVY |
ISHARES DOW SEL DIV |
50% |
50% |
|
TOTAL |
100% |
100% |
|
|
|
|
|
|
|
|
| Jim Lowell’s Sower’s Growth Portfolio |
|
|
| EFA |
ISHARES MSCI EAFE FD |
25% |
25% |
| IYY |
ISHARE DJ TOT MKT IN |
15% |
15% |
| MDY |
MidCap SPDRs |
15% |
15% |
| DIA |
DIAMONDS |
10% |
10% |
| IWM |
ISHARES RUSSELL 2000 INDEX FD |
10% |
10% |
| EEM |
ISHARES MSCI E.M.I.F |
10% |
10% |
| ONEQ |
Fidelity Nasdaq Composite Index Tracking Stock – Fidelity Nasdaq Composite Index Tracking Stock |
7.5% |
7.5% |
| PWC |
PowerShares Dynamic Market Portfolio |
7.5% |
7.5% |
|
|
100% |
100% |
|
|
|
|
| Frank Armstrong’s Ideal Index Portfolio |
|
|
| VGTSX |
Vanguard Total Intl Stock Index |
31% |
31% |
| VBISX |
Vanguard Short-Term Bond Index |
30% |
30% |
| VISVX |
Vanguard Small Cap Value Index |
9.25% |
9.25% |
| VIVAX |
Vanguard Value Index |
9.25% |
9.25% |
| VGSIX |
Vanguard REIT Index |
8% |
8% |
| VISGX |
Vanguard Small Cap Growth Index |
6.25% |
6.25% |
| VFINX |
Vanguard 500 Index |
6.25% |
6.25% |
|
|
100% |
100% |
|
|
|
|
| John Wasnik’s Nano Investment Portfolio |
|
|
| VTI |
Vanguard Total Stock Market ETF |
20% |
33% |
| VGTSX |
Vanguard Total Intl Stock Index |
20% |
33% |
| VNQ |
Vanguard REIT ETF |
20% |
33% |
| TIP |
ISHARES LEHMAN TIPS |
20% |
0% |
| AGG |
iShares Lehman Aggregate Bond Fund |
20% |
0% |
|
|
|
100% |
|
|
|
|
| Andrew Tobias’ Lazy Portfolio |
|
|
| VTSMX |
Vanguard Total Stock Mkt Idx |
33.30% |
50.00% |
| VGTSX |
Vanguard Total Intl Stock Index |
33.30% |
50.00% |
| VIPSX |
Vanguard Inflation-Protected Secs |
33.30% |
0.00% |
|
|
99.90% |
100.00% |
|
|
|
|
| William Bernstein’s Basic No-Brainer Portfolio |
|
|
| VFINX |
Vanguard 500 Index |
25% |
33% |
| VTMSX |
Vanguard Tax-Managed Small Cap Inv |
25% |
33% |
| VTMGX |
Vanguard Tax-Managed Intl |
25% |
33% |
| VBISX |
Vanguard Short-Term Bond Index |
25% |
0% |
|
|
100% |
100% |
|
|
|
|
| William Bernstein’s No Brainer Cowards Portfolio |
|
|
| VFSTX |
Vanguard Short-Term Investment-Grade |
40% |
|
| VTSMX |
Vanguard Total Stock Mkt Idx |
15% |
1/4 |
| VISVX |
Vanguard Small Cap Value Index |
10% |
17% |
| VIVAX |
Vanguard Value Index |
10% |
17% |
| VEIEX |
Vanguard Emerging Mkts Stock Idx |
5% |
8% |
| VEURX |
Vanguard European Stock Index |
5% |
8% |
| VPACX |
Vanguard Pacific Stock Index |
5% |
8% |
| VGSIX |
Vanguard REIT Index |
5% |
8% |
| VTMSX |
Vanguard Tax-Managed Small Cap Inv |
5% |
8% |
|
|
100% |
100% |
|
|
|
|
| Bill Schultheis’ Coffeehouse Portfolio Three ETF |
|
|
| VTI |
Vanguard Total Stock Market ETF |
33.3% |
50.0% |
| EFV |
ISHARES MSCI VLU IDX |
33.3% |
50.0% |
| AGG |
iShares Lehman Aggregate Bond Fund |
33.3% |
0.0% |
|
|
100% |
100% |
|
|
|
|
| Bill Schultheis’ Coffeehouse Portfolio ETFs |
|
|
| AGG |
iShares Lehman Aggregate Bond Fund |
40% |
0% |
| IVV |
ISHARE S&P 500 INDX |
10% |
17% |
| IVE |
ISHARE SP500 BAR VAL |
10% |
17% |
| EFA |
ISHARES MSCI EAFE FD |
10% |
17% |
| IYR |
ISHARE DJ R EST INX |
10% |
17% |
| IWN |
ISHARES RUSSELL 2000 VALUE INDEX FD |
10% |
17% |
| JKJ |
ISHARES MRGN SM CORE |
10% |
17% |
|
|
100% |
100% |
|
|
|
|
| Bill Schultheis’ Coffeehouse Portfolio Vanguard |
|
|
| VBMFX |
Vanguard Total Bond Market Index |
40% |
0% |
| VFINX |
Vanguard 500 Index |
10% |
17% |
| VIVAX |
Vanguard Value Index |
10% |
17% |
| VGTSX |
Vanguard Total Intl Stock Index |
10% |
17% |
| VGSIX |
Vanguard REIT Index |
10% |
17% |
| VISVX |
Vanguard Small Cap Value Index |
10% |
17% |
| NAESX |
Vanguard Small Cap Index |
10% |
17% |
|
|
100% |
100% |
|
|
|
|
| David Swensen’s Lazy Portfolio |
|
|
| VTSMX |
Vanguard Total Stock Mkt Idx |
30% |
43% |
| VGSIX |
Vanguard REIT Index |
20% |
29% |
| VGTSX |
Vanguard Total Intl Stock Index |
20% |
29% |
| VIPSX |
Vanguard Inflation-Protected Secs |
15% |
0% |
| VFISX |
Vanguard Short-Term Treasury |
15% |
0% |
|
|
100% |
100% |
|
|
|
|
| Scott Burns’ Couch Potato Portfolio |
|
|
| VTSMX |
Vanguard Total Stock Mkt Idx |
50% |
100% |
| VIPSX |
Vanguard Inflation-Protected Secs |
50% |
0% |
|
|
100% |
100% |
|
|
|
|
| Scott Burns’ Margarita Portfolio |
|
|
| VTSMX |
Vanguard Total Stock Mkt Idx |
33.30% |
50.00% |
| VIPSX |
Vanguard Inflation-Protected Secs |
33.30% |
0.00% |
| VGTSX |
Vanguard Total Intl Stock Index |
33.30% |
50.00% |
|
|
99.90% |
100.00% |
|
|
|
|
| Scott Burns’ Four Square Portfolio |
|
|
| VTSMX |
Vanguard Total Stock Mkt Idx |
25% |
33% |
| VIPSX |
Vanguard Inflation-Protected Secs |
25% |
|
| VGTSX |
Vanguard Total Intl Stock Index |
25% |
33% |
| VGSIX |
Vanguard REIT Index |
25% |
33% |
|
|
100% |
100% |
|
|
|
|
| Scott Burns’ Five Fold Portfolio |
|
|
| VTSMX |
Vanguard Total Stock Mkt Idx |
20% |
33% |
| VIPSX |
Vanguard Inflation-Protected Secs |
20% |
|
| VGTSX |
Vanguard Total Intl Stock Index |
20% |
33% |
| VGSIX |
Vanguard REIT Index |
20% |
33% |
| BEGBX |
American Century International Bd Inv |
20% |
|
|
|
100% |
100% |
|
|
|
|
| Scott Burns’ Six Ways from Sunday Portfolio |
|
|
| VTSMX |
Vanguard Total Stock Mkt Idx |
16.7% |
25.0% |
| VIPSX |
Vanguard Inflation-Protected Secs |
16.7% |
0.0% |
| VGTSX |
Vanguard Total Intl Stock Index |
16.7% |
25.0% |
| VGSIX |
Vanguard REIT Index |
16.7% |
25.0% |
| BEGBX |
American Century International Bd Inv |
16.7% |
0.0% |
| VGENX |
Vanguard Energy |
16.7% |
25.0% |
|
|
100.0% |
100.0% |
|
|
|
|
| Ted Aronson’s Lazy Portfolio |
|
|
| VEIEX |
Vanguard Emerging Mkts Stock Idx |
20% |
25% |
| VFINX |
Vanguard 500 Index |
15% |
19% |
| VPACX |
Vanguard Pacific Stock Index |
15% |
19% |
| VEXMX |
Vanguard Extended Market Idx |
10% |
13% |
| VIPSX |
Vanguard Inflation-Protected Secs |
10% |
0% |
| VEURX |
Vanguard European Stock Index |
5% |
6% |
| VWEHX |
Vanguard High-Yield Corporate |
5% |
0% |
| VUSTX |
Vanguard Long-Term U.S. Treasury |
5% |
0% |
| VISGX |
Vanguard Small Cap Growth Index |
5% |
6% |
| VISVX |
Vanguard Small Cap Value Index |
5% |
6% |
| VTSMX |
Vanguard Total Stock Mkt Idx |
5% |
6% |
|
|
100% |
100% |
|
|
|
|
|
|
|
|
| Merriman Vanguard Equity |
|
|
| VFINX |
Vanguard 500 Index |
10.00% |
10.00% |
| VIVAX |
Vanguard Value Index |
10.00% |
10.00% |
| NAESX |
Vanguard Small Cap Index |
10.00% |
10.00% |
| VISVX |
Vanguard Small Cap Value Index |
10% |
10% |
| VGSIX |
Vanguard REIT Index |
10% |
10% |
| VDMIX |
Vanguard Developed Markets Index |
20% |
20% |
| VTRIX |
Vanguard International Value |
20% |
20% |
| VEIEX |
Vanguard Emerging Mkts Stock Idx |
10% |
10% |
|
|
100.00% |
100.00% |
Mon, July 2 2007 » Blog » Comments Off on Lazy Portfolios Update: 1st Half 2007
Would you please take just a moment and do me a favor? Please nominate the Mad Money Machine as best business podcast at PodCastAwards.com. Go to PodCastAwards.com and under the “Business” heading enter “Mad Money Machine” as the Podcast Name and “http://MadMoneyMachine.com” as the Podcast URL.
Then go to the bottom of the page and enter your name and correct email address and a comment about the show and click the “Submit” button at the right of the comments area.
Thank you so much!
Sun, July 1 2007 » Announcements » Comments Off on Please Nominate Mad Money Machine at PodCastAwards.com
On remote from windy Myrtle Beach, SC. Not watching Mad Money nor investments. Please nominate MMM at PodcastAwards.com. I donated to the Nike+iPod Stats developer. The MMM Donate button. My running results and the Calorie Economy.
I ENCOURAGE you to Download this show thru iTunes!
But, if you just can’t possibly deal with that then go ahead and
Play the new show right now
The Mad Money Machine is proud to be sponsored by Index Funds Advisors at ifa.com.
Email me: feedback at Mad Money Machine dot com, or comment, or Call me on the Mad Money Machine voicemail line at 206-734-4763
From windy Myrtle Beach, South Carolina. We had a great week of vacationing. Some putt-putt golf, some Par-3 golf. Lots of eating. Some great running along the beach including personal bests.
I donated to the Nike + iPod Stats developer.
I added a donate button to the MadMoneyMachine.com site to allow you to show your support.
I didn’t watch Mad Money this week, unlike 2005 when I was in the room at 6PM each evening to catch Jim’s stock picks. Live and learn!
It feels great being in an index portfolio so that I don’t have to worry about my investments during our vacation.
We ate at Mammy’s Kitchen and got the $6.50 all-you-can-eat breakfast.
Even so, I’m learning something about the “Calorie Economy.” And it is that it is a whole lot easier to consume calories than it is to expend them. I ran 6 miles and burnt about 850 calories. I can eat that much in about 5 minutes!
Take the Risk Capacity Survey at IFA.com!
Sat, June 30 2007 » Podcasts » Comments Off on MMM-068: Laying Under the Beach Umbrella All Day
Did MagicFormulaInvesting work? Early retirees answers to What do you do? How Free Markets work. Mark Hebner’s Step 6: Style Drift.
I ENCOURAGE you to Download this show thru iTunes!
But, if you just can’t possibly deal with that then go ahead and
Play the new show right now
The Mad Money Machine is proud to be sponsored by Index Funds Advisors at ifa.com.
Email me: feedback at Mad Money Machine dot com, or comment, or Call me on the Mad Money Machine voicemail line at 206-734-4763
Prompted by Nick’s email, I review the performance of Joel Greenblatt’s Magic Formula Investing stock picks from 15 December 2005 and compare it to the IndexFolio 100.
From the 83 surviving stocks, if one had invested $1000 in each, the total return would have been 12.3% from 15 Dec 2005 thru 20 June 2007. The IndexFolio 100 was up 38.12% from 1 Dec 2005 thru 31 May 2007.
Of the 10 stocks I selected as the ones to buy back then, $1000 in each would have gone up 40.3%. Seems like a lot of risk for very little extra return. The worst ten performing of the 83 have returned -37.5%. Ouch!
William writes to ask how he should start saving for retirement at age 37.
Our Tool helps William calculate his savings.
We take a look at Step 6: Style Drift. Do you really think someone can predict which category of stocks will do better? Why let them gamble with your money?
So, what do you do? I ask the early retirees how they answer this question.
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Music from music.podshow.com:
salala – angelique kidjo
Runaway Train – Under Feather
Thu, June 21 2007 » Podcasts » 1 Comment
Investing doesn’t have to be complex. Bill Gates has a 4-step solution to complexity. Hedge-funds. John Bogle speaks to graduates.
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But, if you just can’t possibly deal with that then go ahead and
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The Mad Money Machine is proud to be sponsored by Index Funds Advisors at ifa.com.
Email me: feedback at Mad Money Machine dot com, or comment, or Call me on the Mad Money Machine voicemail line at 206-734-4763
Warren Buffet’s good friend, billionaire Bill Gates, gave the Harvard Commencement Address last week. (transcript)See the video. He talked about how COMPLEXITY hinders people from fully grasping a situation, hindering change. He recommended four steps to getting through complexity: 1) Determine a goal 2) find the “Highest Leverage Approach” 3) Find the best technology to solve the problem 4) get started right away with the technology that already exists.
I talk about how we can use these four steps to make investing less COMPLEX: 1) Goal? Financial Freedom 2) Highest leverage is to get the best return at the LOWEST RISK 3) Best technology is to own all stocks 4) available technology: DFA index funds or Vanguard index funds.
Bill Gates went on to say that we need to shape market forces to reduce inequity in the world. What a great idea.
How can we make something so simple more complex than it need to be? Let’s try to buy individual stocks instead of all stocks. Seeking Alpha: the difference above market return. Problem: the average of all alpha is less than zero due to fees and expenses of seeking alpha.
Hedge-funds charge 2% of amount invested and 20% of the profits. The Manhattan condo had several famous celebrities, but the most lavish condo at $45 Million went to the “brash and very successful hedge-fund manager” Dan Loeb. I want to run a Hedge-Fund!
Our Guru hosts a podcast (actually a radio show) that is 8.5 out of 10 on my Podcast-O-Meter.
We check in on the Portfolio Smackdown. Three people have moved ahead of the Indexfolio 100 as of last Friday.
After the end of June I will update you on the Lazy Portfolios performance year-to-date.
The book Index Funds: The 12-Step Program for Active Investors by Mark Hebner is currently unavailable from Amazon. So, go to your local bookstore and have them order a copy for you!
Our Tool takes you to school.
You can see my updated running statistics from my Nike + iPod gizmo that records my runs.
I lost my “Active Trader” status from my brokerage firm. That means they turned off Streaming Quotes from my Active Trader software. Instead I have to live like a commoner and get 2-minute delay now.
Bodotdot writes to compare playing Fantasy Football to the Portfolio Smackdown.
I changed one of three bulbs in my office with a compact fluorescent bulb. Guess which bulb attracts more bugs? I bought a bug zapper from Costco. The next morning: No Vacancy!
I talk about the discussion at Diehards.org/forums that I mentioned in the next post down, about whether anyone is able to retire in their 40’s.
John Bogle’s commencement speech is called “Enough.” He talks about the hedge-fund manager who made more money in one day than Joseph Heller made in the whole history of selling his book “Catch-22.” But Heller said he has something the hedge-fund manager doesn’t have: Enough!
What is happening to the American economy? It is turning into a purely financial-services economy. Twenty-five years ago, the financial sector comprised only 8% of the profits of the S&P500. It now likely exceeds 33% according to Bogle.
Where possible, steal yourself away from complexity. The more complexity in your investments, the more chance that the odds are in favor of the guy across the table.
Take the Risk Capacity Survey at IFA.com!
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Music from music.podshow.com:
Complex Tactics – Ben Base
The Pop Culture – DJ Top Shelf
Run Run Run – The Goldstars
Just A Fantasy – Stefani Stevens
Fantasy World – base-box
Money – Theory in Motion
Creepy Bugs – Munkey Juice
Alpha – Noam Weinstein
Runaway Train – Under Feather
Wed, June 13 2007 » Podcasts » 1 Comment
There is an interesting discussion thread at the Diehards.org/forum asking the question, ‘Has anyone retired in their 40’s or aspires to?’ Lots of folks answered in the affirmative and have some great tips on making it work, both financially and psychologically. Some recurring themes: live below your means, use a 3% or 4% safe withdrawal rate (SWR), and find something interesting to do.
Mon, June 11 2007 » Announcements » 4 Comments
Investing can be simple. Cramer self-deprecates. I formally challenge Jim to go public with his performance. Phil Keaggy is my guitar hero. How to compare performance of ETFs. And more!
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I WANT TO ATTEND DIEHARDS VI… CAN YOU GET ME A TICKET???
Simplicity: Tervis tumblers, one per family member.
Investing can be simple. It doesn’t require an hour of homework per stock per week. Index funds make it simple to invest, especially at tax time, also at rebalance time, and most any other time. Also, having fewer accounts makes life simpler. The ultimate in simplicity is…. hire a professional FEE-ONLY financial advisor. With IFA, to me it is like getting free professional advice because of the historical performance of the DFA funds they put together for you.
Our Guru likes simple things too.
I review Jim Cramer’s featured article in the New York magazine. He criticizes himself in the article. Says he was lucky to be in the right place at the right time to do the Mad Money show. But doesn’t talk about whether he is making people money. He says ‘Cramer-Haters’ are for the most part, right. Says his picks beat the S&P 500 63% of the time. What exactly does that mean??? Then I go off on a rant asking him to make public the performance of his stock picks… to run a pretend portfolio of stocks and show its performance… blah blah blah. He’ll never do it.
My Guitar Hero: Phil Keaggy. Subscribe to this podcast at iTunes by clicking the link on his page.
Mark calls and wants to know if there is a better charting website that can compare the total performance of ETFs including dividends. See my previous post on the subject.
A440 is Concert Pitch and corresponds to the A above middle C on a piano. But funny enough, the note A on a piano may not actually contain a partial frequency at 440 Hz.
Music from music.podshow.com:
Alta Plaza – XRAY Dogs
Simplify Your Vision – Lance Lopez
For What Its Worth – Buffalo Springfield
Robot – StudioMig
Game Day – Jon Schmidt – Powerful Exhilarating Piano Music
Runaway Train – Under Feather
Tue, June 5 2007 » Podcasts » 1 Comment
A tale of two graphs -or-
Don’t believe everything you see
I’ll talk some more about this on show 65. But a caller wanted to know how to compare the performance of his ETF that pays dividends against other investments. The charts lie, basically. Yahoo Finance and other charts are dumb and just plot the stock’s price. They don’t take into account reinvested dividends to give a more accurate representation of the investment’s performance in your portfolio.
Fortunately, StockCharts.com’s PerfChart comes to the rescue. See the difference on the Vanguard REIT ETF (VNQ) below:
This is the Yahoo Finance chart showing the gain in the STOCK PRICE ONLY.
This is the StockCharts.com PerfChart showing the gain in the INVESTMENT including reinvested dividends.
Anyone know of another stock chart site that gives the correct chart?
Mon, June 4 2007 » Announcements » Comments Off on How to get an accurate investment graph
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