Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
@Old_Skeet Can you please explain why your all weather asset allocation is 20-40-40? Is it risk tolerance, your age, anticipated size of a market decline or any other reasoning?
I remember good years for US stocks, when EM outperformed US. But I do not know bad years for US stocks, when EM performed well. So, your attitude to EM depends first of all on your predictions to US market.
@davidrmoran Even though CAPE is better than other value oriented indexes, DSENX underperformed S&P 500 when market moved down. It was a test for me to verify DSENX preservation ability. I had to sell the fund completely when switched to preserv…
@Simon Many expect recession next year or in 2020. You suggest the bear market will end in 3 months before a recession even started. Therefore we will have to see another bear market before the recession. It is very difficult to justify that.
I believe it was a bottom. Technically, the market had to decide today whether the last 3 months was a correction or the beginning of a bear market and it decided in favor of the correction.
Above mentioned PG&E bond already dropped YTM to 6.1% after announcement that California regulators do not expect company's bankruptcy. Stock jumped up 30%. Now PG&E bonds are trading in the same range as GE Capital bonds.
@johnN It is very difficult to imagine PG&E bankruptcy. First, its liability for California fires should established, then the size of liabilities ordered by court should be really huge to bankrupt the company. The notes will mature in 2 years a…
@fundalarm Recession maybe one year from now. But the market does not wait till it starts and corrects itself in advance. When the current correction is over I anticipate slow or no growth of the stock market for some time before the recession. You …
I believe America will face a recession within 1-2 year and it wiil be severe one after 10 years of bull market. Based on previous experience EM and China will not be doing well at that time. It makes sense to postpone buying EM till after the rec…
@VintageFreak If I understood you correctly you outlined your investment strategy as following: keep some balanced funds as core, allocate to stocks and cash in different proportions depending on the situation. In the worst case scenario (recession…
@JoeD and VintageFreak : If 100% cash is your answer, then the next question when to sell your stocks. You do not know the exact timing of the recession but you anticipate it in the coming months. Also there should be some transitional period: you d…
@msf These are BulletShares ETF. They have a pool of bonds that mature in the same year. The problem I see with these ETF is that during last year before fund termination when bonds mature the fund wiil accumulate the cash and will pay much smaller …
Thanks John. Do not you think that ETF or MF has the same market and interest rate risks as all other junk bond funds? Holding individual bond till maturity eliminates those risks.
@Old_Skeet, thank you. My mutual funds usually underweight energy sector and I was OK with that till recently. Now I jumped to XOP to compensate the deficiency. Do you have any mutual fund that has a substantial percentage in energy, but does not be…
@Old_Skeet, I am wondering why you did not include energy equity into your special investment interest area. The sector is very hot lately and the best performer YTD.
It does not say anything about currency risk. IEML invests in local currency and does not use currency hedging. Its good results during last months are due to declining dollar. What happens if dollar goes up is a big question, making unhedged EM bon…
I am interested now in world bond funds (like PFBDX) that have no or small emerging market bond allocation. Does anybody have insight on world bond funds and risk related to currency hedging?
I am 100% invested and decided to ignore a possible correction, that is usually short-lived. Instead I am thinking about preparing myself to recession that will be much more prolonged. If we have melt-up we may see a recession at the end without hav…
@Old_Joe @davfor Thank you for emphasizing importance of professional portfolio management in that case. Frankly speaking, I was thinking of doing that myself and to help him to save on fee. That was one of the reasons I posted the question. I see …
@davfor Thank you for your advice. As you manage your sister investment what is an average withdrawal rate to compensate expenses and to refill her emergency fund ? Does her portfolio balance gradually decrease and, if yes, how many years you plan t…
@davidrmoran It is a mental illness and lifespan is not affected.
@Old_Joe What would be optimal investment for consistent income return of 4%, that is considered normal for retirees?
@Puddnhead The money is in a brokerage cash account. The investment should be safe as there is no other money to live on. I am not sure about family help. At 62 he will be eligible for SS, but my understanding SS benefits will be similar to SSDI be…
