Pragmatic Observer's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/24994/comments http://seekingalpha.com/article/172440-the-schwab-etf-launch-more-important-than-you-think?source=feed#comment-753793 753793
Schwab is now in a position to be the first to offer transaction free ETF dollar cost averaging for your retirement account. As plan administrator for thousands of retirement plans, and always looking for more business, what better way to attract more business than to remove the biggest obstacle to investing in ETFs through your company's retirement program?

Others will have to follow if they hope to KEEP the company retirement accounts they currently have.]]> Tue, 10 Nov 2009 10:34:53 -0500
Schwab is now in a position to be the first to offer transaction free ETF dollar cost averaging for your retirement account. As plan administrator for thousands of retirement plans, and always looking for more business, what better way to attract more business than to remove the biggest obstacle to investing in ETFs through your company's retirement program?

Others will have to follow if they hope to KEEP the company retirement accounts they currently have.]]> http://seekingalpha.com/article/80715-oil-prices-fall-on-saudi-announcement?source=feed#comment-183252 183252
You need to stop listening to “Hate Radio”, and start dealing with reality.
]]> Wed, 11 Jun 2008 09:52:22 -0400
You need to stop listening to “Hate Radio”, and start dealing with reality.
]]> http://seekingalpha.com/article/36694-an-endowment-portfolio-from-publicly-traded-vehicles?source=feed#comment-87446 87446 Ooops! Sorry about that. I actually saw that same reference made some time ago on a discussion board on Morningstar's web site. They were throwing out ideas on this very subject and someone made that same connection. I'll check it out. That makes things a little simpler since the IPRV.L could be problematic to access.

Mebane,
Is IPRV.L available in the US and if so, where can one find information on it?]]> Thu, 31 May 2007 21:18:48 -0400 Ooops! Sorry about that. I actually saw that same reference made some time ago on a discussion board on Morningstar's web site. They were throwing out ideas on this very subject and someone made that same connection. I'll check it out. That makes things a little simpler since the IPRV.L could be problematic to access.

Mebane,
Is IPRV.L available in the US and if so, where can one find information on it?]]> http://seekingalpha.com/article/36694-an-endowment-portfolio-from-publicly-traded-vehicles?source=feed#comment-87385 87385
ABSOLUTE RETURN 25%
5% DIAMX Diamond Hill Long-Short
5% ARBFX Merger Arbitrage
5% HSGFX Absolute Return
5% JAMNX Market Neutral
5% TAVFX Third Avenue Value

DOMESTIC EQUITY12%
6% SPY US Large Cap
6% IWM US Small Cap

FIXED INCOME 4%
4% TIP US TIPS

FOREIGN EQUITY 15%
7.5% EFA Foreign Developed
7.5% EEM Foreign Emerging Markets
Note; Swensen has alluded to going 50% into emerging markets.

PRIVATE EQUITY 17%
10% IPRV.L Private Equity Fund
3.5% BAM Brookfield Asset Management
3.5% ACAS American Capital Strategies (or any of several others)

REAL ASSETS 27%
6% IYR US REITs
6% RWX International REITS
5% DJP Commodities
5% GSP Commodities
5% VAW Vanguard Raw Materials (or other similar options)

However, keep in mind that Swensen recommends an asset allocation of 70% stocks and 30% bonds/income for the “average investor”. The breakdown is:
20% Real Estate
20% Foreign
30% US Equities]]> Thu, 31 May 2007 11:36:46 -0400
ABSOLUTE RETURN 25%
5% DIAMX Diamond Hill Long-Short
5% ARBFX Merger Arbitrage
5% HSGFX Absolute Return
5% JAMNX Market Neutral
5% TAVFX Third Avenue Value

DOMESTIC EQUITY12%
6% SPY US Large Cap
6% IWM US Small Cap

FIXED INCOME 4%
4% TIP US TIPS

FOREIGN EQUITY 15%
7.5% EFA Foreign Developed
7.5% EEM Foreign Emerging Markets
Note; Swensen has alluded to going 50% into emerging markets.

PRIVATE EQUITY 17%
10% IPRV.L Private Equity Fund
3.5% BAM Brookfield Asset Management
3.5% ACAS American Capital Strategies (or any of several others)

REAL ASSETS 27%
6% IYR US REITs
6% RWX International REITS
5% DJP Commodities
5% GSP Commodities
5% VAW Vanguard Raw Materials (or other similar options)

However, keep in mind that Swensen recommends an asset allocation of 70% stocks and 30% bonds/income for the “average investor”. The breakdown is:
20% Real Estate
20% Foreign
30% US Equities]]> http://seekingalpha.com/article/36694-an-endowment-portfolio-from-publicly-traded-vehicles?source=feed#comment-87271 87271 SWHEX) which has actually outperformed DIAMX year to date (DIAMX; -0.7% vs SWHEX; +5.0%) and ANGLX (+3.94%). DIAMX has the better long term (3+ years) return. ANGLX has the lowest fees (1.31%) with Schwab having the highest (1.76%).

Since Private Equity is the most difficult asset class for the average investor to access, here are a couple more alternatives to consider.

MVC (up 39% YTD with a PE of 6.5); CSWC (up 38% YTD with a ROE of 31.3); ACAS up 45% in one year with a yield of 5.6% and a PE of 7.8); TICC (up 27% in one year and yield of 8.6%) along with MIC (up 70% in the last year and a yield of 4.9%) are all involved in private equity purchases and financing. Any thoughts on these?

Swensen also includes investments like natural resources, timber, and other commodities in his Real Asset grouping. DJP and GSP are excellent ETF choices. GSP is more heavily weighted in oil and gas. You could include a mutual fund like US Global Resources (PSPFX; also heavy on oil and gas) which is up over 15% YTD, or Vanguard Raw Materials ETF (VAW) up 31% in the past year. In the Real Estate group Alpine International Real Estate mutual fund (EGLRX) has outperformed the US market this year (+13.1% vs ICF down 3.7%) and the international real estate REIT (RWX) which has returned 8.2%.

As always, it is important to understand that while these alternative asset classes have done very well in the past few years, they will not always lead the way. Nonetheless, they have done MUCH better than the US markets, which everyone is all excited about now, and do offer excellent diversification options along the lines that Swensen recommends.

Just a few ideas. Any comments or suggestions?]]> Wed, 30 May 2007 12:56:48 -0400 SWHEX) which has actually outperformed DIAMX year to date (DIAMX; -0.7% vs SWHEX; +5.0%) and ANGLX (+3.94%). DIAMX has the better long term (3+ years) return. ANGLX has the lowest fees (1.31%) with Schwab having the highest (1.76%).

Since Private Equity is the most difficult asset class for the average investor to access, here are a couple more alternatives to consider.

MVC (up 39% YTD with a PE of 6.5); CSWC (up 38% YTD with a ROE of 31.3); ACAS up 45% in one year with a yield of 5.6% and a PE of 7.8); TICC (up 27% in one year and yield of 8.6%) along with MIC (up 70% in the last year and a yield of 4.9%) are all involved in private equity purchases and financing. Any thoughts on these?

Swensen also includes investments like natural resources, timber, and other commodities in his Real Asset grouping. DJP and GSP are excellent ETF choices. GSP is more heavily weighted in oil and gas. You could include a mutual fund like US Global Resources (PSPFX; also heavy on oil and gas) which is up over 15% YTD, or Vanguard Raw Materials ETF (VAW) up 31% in the past year. In the Real Estate group Alpine International Real Estate mutual fund (EGLRX) has outperformed the US market this year (+13.1% vs ICF down 3.7%) and the international real estate REIT (RWX) which has returned 8.2%.

As always, it is important to understand that while these alternative asset classes have done very well in the past few years, they will not always lead the way. Nonetheless, they have done MUCH better than the US markets, which everyone is all excited about now, and do offer excellent diversification options along the lines that Swensen recommends.

Just a few ideas. Any comments or suggestions?]]> http://seekingalpha.com/article/36694-an-endowment-portfolio-from-publicly-traded-vehicles?source=feed#comment-87192 87192 HSGFX +.13% YTD 1.14% Exp Ratio
TFSMX +5.3% YTD 2.49% Exp
JAMNX +3.2% YTD 1.95% Exp
ARBFX +3.9% YTD 1.95% Exp
DIAMX +1.0% YTD 1.51% Exp

Yes, they do indeed offer diversification, but at what price, and for what kind of return, over the long haul? A couple of ideas to add to your research.

You have the US, Foreign, REIT and Commodities covered. The Absolute Return and Private Equity are the problems for the average investor trying to replicate the Yale Endowment. Here are a couple of things I've considered.

1) In the Private Equity area, consider holding such stocks as Brookfield Asset Management (BAM: plus 33% vs plus 7% for the S + P 500 YTD), Leukadia (LUK: plus 20% YTD ) and Macquarie Infrastructure (MIC; plus 24% YTD) among others, as well as Berkshire Hathaway B shares. Now granted, all are publicly traded but all are asset management firms which allow for managing assets beyond the realm of publicly traded companies and shares. If you look at their investment approaches they are not unlike endowments and hedge funds, and even merger and acquisition firms...with much better returns and much lower expense ratios.

2) Could you do an asset allocation, using your proposed funds, using the most recent Yale Endowment allocations, and back test it for five or ten years. This would be fascinating to see how it stacks up.

Keep up the great work. Looking forward to more on this subject.
Paul]]> Tue, 29 May 2007 12:02:42 -0400 HSGFX +.13% YTD 1.14% Exp Ratio
TFSMX +5.3% YTD 2.49% Exp
JAMNX +3.2% YTD 1.95% Exp
ARBFX +3.9% YTD 1.95% Exp
DIAMX +1.0% YTD 1.51% Exp

Yes, they do indeed offer diversification, but at what price, and for what kind of return, over the long haul? A couple of ideas to add to your research.

You have the US, Foreign, REIT and Commodities covered. The Absolute Return and Private Equity are the problems for the average investor trying to replicate the Yale Endowment. Here are a couple of things I've considered.

1) In the Private Equity area, consider holding such stocks as Brookfield Asset Management (BAM: plus 33% vs plus 7% for the S + P 500 YTD), Leukadia (LUK: plus 20% YTD ) and Macquarie Infrastructure (MIC; plus 24% YTD) among others, as well as Berkshire Hathaway B shares. Now granted, all are publicly traded but all are asset management firms which allow for managing assets beyond the realm of publicly traded companies and shares. If you look at their investment approaches they are not unlike endowments and hedge funds, and even merger and acquisition firms...with much better returns and much lower expense ratios.

2) Could you do an asset allocation, using your proposed funds, using the most recent Yale Endowment allocations, and back test it for five or ten years. This would be fascinating to see how it stacks up.

Keep up the great work. Looking forward to more on this subject.
Paul]]>