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Said already several times. The main reason I use lower yield, "safer" MM with no gates because
1) The extra 0.2-0.3% (or a bit more) is *negligible on an annual basis.
2) I also have more than enough and can stay in MM for years but I'm using mostl…
In this link https://cdn.nar.realtor/sites/default/files/documents/hai-06-2023-housing-affordability-index-2023-08-10.pdf
You can see that housing payments doubled since 2020. Affordability is way down too from 2020=169.9 to 06/2023=87.8
Hi dryflower, I do take higher risks but I want to make a lot more than an extra 0.2-0.3% annually. This is why I trade bond funds for weeks-months and back to MM.
Regardless, making 5+% for SOME of the money is great for most.
The money market I am in at Wells Fargo is WMPXX. Its 7 day effective yield is now 5.59%. I see no reason to buy a CD with this money right now.
https://www.allspringglobal.com/investments/mutual-funds/fund-profile/overview/?accountingId=WBC7&s…
Diversification, duration, and experience don't guarantee better risk-adjusted performance, especially in markets as we had since early 2022.
You can own 10 bond funds and still have higher volatility + lower performance.
The article predicts stabil…
Income investing is a myth that has been promoted for years. In many cases, the writer wants to sell you something. Income investing as someone's main/first criterion has no legs in reality because TR=total return (performance) is the ultimate indic…
So my question is: why would you prefer to own bond funds to a longer term CD when rates are falling?
You changed what we are talking about. We were discussing shorter-term CD that matures in 3-6-12 months. I already posted that 3-5 years CD make…
@wabac,
You raised good points. A portfolio can have several goals. Performance is always important. But, I also think that risk-adjusted performance is more important, at least for me, and that can be measured by the Sharpe ratio.
The following …
@FD1000 So what? Just because investors can do this, that or the other thing doesn't mean they will. No matter how hard you try to convince them, they will do what they feel most comfortable with no matter what evidence you provide to the contrary. …
Diversification doesn't guarantee better performance or better risk/SD or better risk-adjusted performance. Being in 10 funds isn't necessarily better than 2 funds. I could be wrong but I can't find any research that proves that more funds are a bet…
Hank, I didn't say that I was an expert or that 15 years make me an expert. You made up these conclusions. I have been posting here for years and will keep posting, I never told anyone they are MISPLACED anywhere as you did.
I state my opinion, how …
Hank: Are you an investment professional? Where did you come by these individual’s performance histories? Must be from somewhere else. It’s quite rare for anyone here to ever post their annual returns. I don't.
FD: this is an observation after pos…
To me, the point isn’t that CD yields can be marginally higher than money markets. It’s that interest rates will start dropping at some point, and then MM yields will drop quickly. With CDs, you can lock in high yields for as long as 10 years, and y…
wow, only 50-100K in each CD? I would have to purchase many of them + deal with so many different institutions. The more details I read about the less I want to do it.
Disclaimer: I never owned CDs or treasuries.
Buffett's investment process is focused on purchasing companies with competitive advantages
(wide moats) at a fair price and holding them "forever."
He believes that at least 98% of people who invest should extensively diversify and not trade.
FW…
I based my system on Buffett's (and Munger) 3 important rules: Rule No. 1: Never Lose Money. Rule No. 2: Never Forget Rule No. 1 and Rule 3: Diversification is a protection against ignorance. I added a fourth rule: momentum. My system was born in ea…
Looking at Fidelity CD for 3-6 months(https://fixedincome.fidelity.com/ftgw/fi/FILanding) shows the highest yield as 5.15-20% while SCOXX pays 5.2%. MM is the easiest way to invest your money with a monthly payout, easy to hold using one fund, easi…
Nothing new and is especially rampant in the USA. No need to go further than Toyota CEO compared to the USA car company CEOs, while Toyota is a much better company.
But, the solution is simpler in the US. Join the best stock market in the world an…
"The focus should be on the minimum needed to achieve an income required in retirement."
The focus should be on risk-adjusted performance and after that look for the income. Income by itself doesn't guarantee better performance or better risk/SD.
…
I'm OK with "only" 5.2% using SCOXX(Treasury) which has a guarantee for no locks. I stopped using SNOXX in 2022, and I'm not coming back anytime soon.
This allows me to trade anytime with ease and flexibility.
Another 0.1-0.2% for 6 months isn't wor…
Wilson on 7-31-2023(link) "Morgan Stanley’s Wilson Says Stock Rally Reminds Him of 2019"
FD: Wilson is trying to save face. The rally already happened while Wilson was a bear.
Wait, if Wilson is saying now that the rally will keep going, that's a g…
No need to go far. Read Charles Lynn Bolin on this site. He posted well-thought articles about risk, reward, and markets which cater to different goals. These are all based on analysis, numbers, and logic.
If what makes you comfortable is the only (or main) criterion why are we spending so much time here?
Investing is all about performance...or...other investors are looking for better risk-adjusted performance.
I have a neighbor who is a multi-million…
Surviving only on income isn't a good option if your portfolio loses money or doesn't make enough, hence total return is everything. If your portfolio is big enough, you will survive anyway.
In the last 5 years, PDI paid about 50% of income in the…
As usual, it depends. ETFs could have higher volatility during the day based on real time event and back to "normal" when it's over while OEFs didn't experience it because the event happened between 10 to 11 AM.
Generally in time of stress, well kn…
@fd1000
How much do you think the tea leaf reader meaning Wilson pulls down in salary annually? Where else can you be so wrong and get paid to keep doing it?
There are several others who do this.
The weatherman=markets predictor
I never promoted income based portfolio. I say look at categories/stocks and select the best risk-adjusted ones. This can be growth stocks or income or others. Never starts your selection by looking only at higher-income stocks.
Drawing from a por…
@FD1000 In other threads haven't you also advocated for owning IOFIX at times, a bond fund with an extraordinarily high for bonds 1.50% expense ratio? You've also suggested PRWCX, which, while an excellent fund, isn't cheap but average expense ratio…
I listened to the Clark Howard show (https://clark.com/)in ATL in the early 90s. Clark has been a great advocate for consumers and promoted index funds. This is when I read my first investing book Random Walk..I didn't know much about investing but …
Hank, I keep a library of "experts" (and most are very famous) predictions for decades and it's not pretty. Only fools try predicting the future, but that's what keeps the media going.
I don't know why you are surprised that we agree on something. …
@FD1000: You can sit there and blather whatever you want. It doesn't change the fact that coming from middle-class families with little inherited wealth we can now sit here without any financial worry, and that our American Fund financial advisor pl…
FA(financial advisers) catch 22. When your knowledge is below average, you can't distinguish between a good FA to below average/average one.
When your knowledge is above average, you don't need a FA.
I never invested with AF funds. Suppose I start…
I'm not a big fan of American with so many funds and create confusion. The funds that are available at Fidelity have ER of 0.64% to 0.96% which isn't cheap. Their stock funds are better than bond funds. They use many financial advisers which I'm no…
In the last 20+ years, I read/heard many times about other indexes, they come and go but VOO or VTI are the golden standard. The way these two are calculated is another plus.
Goldman: Stock valuations are justified, even in the face of rising rate…
