Investing

Determining Expected Return from Stocks

16 years ago
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Whenever fear levels are high, I find it comforting to go over the fundamentals of investing.  Today I am revisiting how you should set your exptations for long term returns from equities. Equity returns come from the following sources Dividends Earnings growth Price/Earnings ratio expansion or [...]

Should You Rebalance?

16 years ago
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With the markets down significantly most people’s portfolios have drifted away from their target allocations.  For those brave enough to look at their porfolios right now, a natural question is should I rebalance to bring my portfolio back to its target allocations.  This is an attempt to help [...]

Municipal Bond Yield Spread at Record High

16 years ago
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10 yr AAA Municipal bonds are currently yielding around 4.95%. This is 32% HIGHER than the 10 yr Treasury note which is yielding 3.74%.  Most of the time municipal bonds offer lower interest rates compared to Treasuries because of their tax favored status. To see how unusual the current situation [...]

Bubble in Short Term Treasuries

16 years ago
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During the last two weeks we have seen incredible volatility in the markets.  Fear and uncertainty is rampant which has people running to short term treasuries.  Last week even saw the 3 month treasury yield go negative for part of the day.   For those willing to keep their heads this spells [...]

Beware of Variable Annuity GMIB Riders

16 years ago
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Guaranteed Minimum Income Benefit (GMIB) are one of the ways that variable annuities are being sold.  Unfortunately, I have yet to meet a single person who understood what they bought when GMIBs are involved. The bold print talks about guaranteed 5% annual growth in the income base no matter the [...]

US Only 30% of World Equity Market Capitalization

16 years ago
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Bespoke Investment Group released their world market capitalization numbers.  The US now only makes up less than 30% of the world equity market capitalization. The change is mostly due to gains in the BRIC (Brazil, Russia, India, China) and oil producing countries.

Stock Market Heatmap

16 years ago
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For the visually inclined, here is a site that uses heat maps to show all kinds of market characteristics. Make sure to check out the world heat map and the different equity characteristics.

Buy versus Rent Calculator

16 years ago
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The New York Times has put together a great calculator for comparing the economics of buying versus selling a home. Don’t miss the advanced settings in the upper right.  They will allow you to change all kinds of assumptions from transaction costs, to maintenance costs and others.

Managed Payout Funds

16 years ago
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I believe these will eventually become standard fare for retirees.  Unfortunately it is going to take a while for the field to settle down and figure out exactly how these should be configured.  I currently like Vanguard’s funds the best with the following caveats. Their distributions are too [...]

Tracking Municipal Bond Trades

16 years ago
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There is a new site that tracks all trade information for municipal bonds. If you are considering buying or selling individual municipal bonds, this site is invaluable.  It is amazing to me how inefficient this market still is. I was reviewing a particular issue and it was not uncommon to see a [...]
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