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varan

varan
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  • A Global Market Rotation Strategy With An Annual Performance Of 41.4% Since 2003 [View article]
    If the results depend on such minute details, the strategy is not worth it. That also applies to the number of days in the look back period. Any result that you get by some sort of optimization process is very dubious in its usefulness. The first rule of developing good robust strategies is to avoid optimization as much as possible.
    Jun 15, 2014. 12:42 PM | 2 Likes Like |Link to Comment
  • Dividend Growth Investors: Do They Have A Point Or Is It Too Close To Call? [View article]
    By the way if you had put in $7440 a year ($620 a month) in SPY starting in 1975, at the end of 2013 (39 years), you would have had about $4.3M.

    So the goal of $3M is very realistic. Anyone can attain it with a bit of persistence, as there will be lots of ups downs, as they have been since 1975. But then again, I made only $300 a month in my graduate research assistantship in 1975, so I am short a few million of the $4.3M that I should have had by now.
    Jun 15, 2014. 12:28 PM | 1 Like Like |Link to Comment
  • I Have No Fear Of A Market Crash Or A Significant Correction, Here's Why: Part 1 [View article]
    I am extremely impressed by the supreme confidence about facing any potential market drawdown that has been generated by a handful of historical examples, as if history repeats itself without any modifications whatsoever.

    Never have so many been comforted by so little.
    Jun 15, 2014. 11:00 AM | 4 Likes Like |Link to Comment
  • I Have No Fear Of A Market Crash Or A Significant Correction, Here's Why: Part 1 [View article]
    @mmyo3

    Too funny.

    1. Do you know what happens to a nice neighborhood when one or two of the neighbors move out, and, instead of selling, rent out the property?

    2. Have you ever tried to find a tenant during an economic downturn? Have you ever held a rental property during an economic downturn when people are losing their jobs left and right?

    OK to give analogies, but give one that actually puts your case in a better light.
    Jun 14, 2014. 09:08 PM | 3 Likes Like |Link to Comment
  • Dividend Growth Investors: Do They Have A Point Or Is It Too Close To Call? [View article]
    I think it is almost a tautology that you have to invest to achieve your own objective. Nobody invests to achieve objectives of someone else.

    However, the definitions seem to be mixed up. If you have achieved your objective, your performance relative to your objectives has been excellent. That is relative performance. If I had $4M in my portfolio, and only want at least 3% return every year, and I get that, my performance relative to my objectives has indeed been very good. As absolute performance not so much.
    Jun 14, 2014. 12:36 PM | 1 Like Like |Link to Comment
  • I Have No Fear Of A Market Crash Or A Significant Correction, Here's Why: Part 1 [View article]
    Value investing works.

    However it is not as easy as it is made out to be, especially in articles in popular forums such as SA.

    Here is an interview that is quite illuminating.

    http://bit.ly/1pXE4Sk

    Start at 2:00 minute mark to ignore the political talk.

    The mistake that people make is to just concentrate on the cliches which abound even in this interview, e.g. 'some time you just have to sit back and do nothing'. It's not about following the cliches, but to follow what he says apart from those cliches.
    Jun 14, 2014. 12:17 PM | 1 Like Like |Link to Comment
  • Dividend Growth Investors: Do They Have A Point Or Is It Too Close To Call? [View article]
    For the last time: (a) just Google 60/40 portfolio and you should get a lot of hits to read about its history and performance, (b) my personal views on what you should use as a benchmark do not matter.

    I am not recommending anything for anyone, but just presenting the result that anyone can calculate for himself, and then decide for himself what is good for him.

    My personal views and portfolio are irrelevant. They would not be if I make a claim without specifying an algorithm that can be used to replicate the result. In this case the algorithm is very simple.

    When I read something on SA, that is what I am looking for. If I cannot myself replicate the methodology that the author is presenting, or if I have to know what the author's portfolio is in order to evaluate his strategy, I just ignore it.
    Jun 14, 2014. 10:35 AM | Likes Like |Link to Comment
  • Dividend Growth Investors: Do They Have A Point Or Is It Too Close To Call? [View article]
    One could be forgiven for thinking that someone has unleashed paid seventh graders to make it look like a middle school fist fight, all to divert attention from the fact that the so-called real DGI portfolios cannot significantly outperform even the simplest of portfolios.
    Jun 13, 2014. 05:40 PM | 4 Likes Like |Link to Comment
  • Dividend Growth Investors: Do They Have A Point Or Is It Too Close To Call? [View article]
    @Market Map

    "The 60/40 portfolio appears to originate from Markowitz’s concept
    of the “market portfolio" in the 1950's"

    Right. It's a useful benchmark, because it is extremely simple to implement.

    It's quite remarkable that it offends people so when it and it's comparative performance, which obviously has been quite competitive with more complicated strategies, are mentioned.
    Jun 13, 2014. 02:20 PM | Likes Like |Link to Comment
  • Dividend Growth Investors: Do They Have A Point Or Is It Too Close To Call? [View article]
    The new word among the DGI folks is 'haters'.

    You guys are all 'haters' for criticizing them.

    For all their triumphant articles and comments and challenges that are self-affirming to the point of being almost like unintentional parodies of the proclamations from the members of some self-help group, they have to be awfully defensive and unsure of their stance to be so sensitive to any intimations of criticism.

    Leave the poor souls alone in their quest for DGI nirvana.
    Jun 13, 2014. 10:53 AM | 1 Like Like |Link to Comment
  • Dividend Growth Investors: Do They Have A Point Or Is It Too Close To Call? [View article]
    This is very funny.

    After all the discussions and comparisons and the DGI's twisting into logical and semantic knots, it comes down to this: are you willing to show it and compare it in public?

    Stage 1: I don't care about total returns.


    Q: But don't total returns matter in the accumulation phase?

    Stage 2: Yeas but there is no reason to assume that my total returns are not better.

    Q: But they are, if you compare them with even the simplest portfolio that has been publicly know for a long time.

    Stage 3: Are you willing to accept the CHALLENGE?


    The irony is that 60/40 IS already public. So I don't even know what the challenge is.
    Jun 12, 2014. 08:53 PM | 3 Likes Like |Link to Comment
  • Dividend Growth Investors: Do They Have A Point Or Is It Too Close To Call? [View article]
    I think that has nothing to do with what we are discussing here.

    At best an entertaining sideshow.
    Jun 12, 2014. 08:14 PM | 1 Like Like |Link to Comment
  • Dividend Growth Investors: Do They Have A Point Or Is It Too Close To Call? [View article]
    60/40 has not exactly been secret for a long time.

    The simple act of my saying that 'I hereby enter this in the XXXX Challenge' does not mean anything.

    All these questions - whether I own it or not, whether I recommend it or not, whether I enter it in a challenge or not - are, if you pardon the expression, quite childish, especially since I am not selling anything for my personal benefit, and do not belong in a forum where we all are trying to understand what is the best way to invest. Some emotional followers may be swayed by the answers, or the absence thereof, to such questions, but they do not further any real cause for a rational and intelligent investor.

    What I stated are what the comparative returns of the two portfolio have been. How to implement the 60/40 is easy and public knowledge.

    So there is nothing theoretical or esoteric about it.
    Jun 12, 2014. 02:37 PM | 4 Likes Like |Link to Comment
  • Dividend Growth Investors: Do They Have A Point Or Is It Too Close To Call? [View article]
    Actually it does not matter whether he held them or not. His point is well taken that there are good DG stocks that yield good total returns. However, if one goes on that route of enumeration of attractive investments, one has to also look at what a total return investor would have available to him. Clearly one can also easily produced lists of growth stocks which have done better than the listed DG stocks during the last fifteen years.

    But all this creation of lists leads to nowhere. The question is more fundamental. If your ultimate goal is high income in retirement, should you make total return your only goal (even moderate levels of volatility may not be important in pre-retirement years) or worry about income in the accumulation phase?

    I like the hilarity and fun too but that question has been skirted around.
    Jun 12, 2014. 12:59 PM | 2 Likes Like |Link to Comment
  • Dividend Growth Investors: Do They Have A Point Or Is It Too Close To Call? [View article]
    By the way, for record:

    The 60/40 VTI/TLT annually rebalanced portfolio

    Total Return 6/1/2008 thru 6/1/2014 81% CAGR 10.4%

    The much ballyhooed DGI Portfolio (http://bit.ly/1oJK41x )

    Total Return 6/1/2008 thru 6/1/2014 63% CAGR 8.5%

    A Total Return investor will probably invest in growth stocks, so this is quite instructive.

    20% IVW 20% IJK 20% IJT 40% TLT

    Total Return 6/1/2008 thru 6/1/2014 89% CAGR 11.2%

    Summary: 6 year Period.
    DGI Portfolio Return 8.5%
    Total Return Portfolios Returns 10.2% or 11.2%

    Comical indeed.
    Jun 12, 2014. 11:47 AM | 1 Like Like |Link to Comment
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