|
Post by anitya on Aug 14, 2021 17:20:50 GMT
flipperxxx, Welcome to the forum. Yes, from my experience too - Writing helps me by not letting mind wander off in the middle of the thought process and also allowing one not to have to remember the beginning, the middle, and end required to have complete, logical thinking.
|
|
|
Post by anitya on Aug 14, 2021 17:51:17 GMT
In addition to seasonality, is there a day of the week effect too?
|
|
|
Post by oldskeet on Aug 14, 2021 21:48:42 GMT
Hi fliperxxx just pondering ...
Why don't you do an instant Xray analysis on your portfolio? I'm thinking that you will find that you are only about 12% in equity ... if indeed ... you have 20% of your portfolio split equally between PRWCX (70% equity) and VTMFX (47% equity) and hold no other funds that have an equity component. And, besides, if you were to sell down these two holdings what would you do with the cash? Bond funds have risk as well.
|
|
|
Post by jongaltiii on Aug 14, 2021 22:43:36 GMT
A quick digression to FBALX and FMSDX - Yogi can give you a scientific answer but my eyeball observation has been that in the past year + their correlation with the equity market volatility is much higher than their stated equity %age suggests. The returns have not been corresponding to the volatility - of course, it does not say anything about the future! P.S.: I currently have a 5% position in FBALX (a few years old) and an experimental position in FMSDX. I am unlikely to use the money from this thread to elevate FMSDX. BTW, when I say starter position elsewhere, I mean experimental position. Fido & PV data (M* data is too stale) FBALX nominal equity 68.31% (misclassified as moderate allocation, M* 50-70%), but effective equity 76.26% (aggressive allocation) FMSDX nominal equity 61.70% (misclassified as conservative allocation allocation, M* 30-50%), but effective equity 57% (moderate allocation) So, both are operating a notch above their labels. Yogi- thanks for providing the data that shows how aggressive (if you will) these AA or “balanced” funds really are. They sure do hold a lot of equities. Ok, now that said, and using FBALX as an example…based on the long positive return record, could it be that the fund manager knows more than the average investor? They know that they should be overweight in equities and not bonds or even high risk bonds at the moment? Isn’t that some secret sauce or no? I mean, I could just be overweight in SPY and then playing around with HY bonds or just use AA funds to do that “heavy” lifting. I know for some, it’s not heavy lifting - picking the best bond funds at the best time… but it’s not something I do. Good discussion.
|
|
|
Post by yogibearbull on Aug 14, 2021 23:04:22 GMT
jongaltiii, fund category mismatch draw my attention. I have no problem if FBALX is identified in the aggressive allocation category (M* 70-85%). In up-market, it would show up near the top of the chart in misclassified moderate allocation category (M* 50-70%) or category ranks. It was not too long ago when FBALX holders wondered early last year why FBALX was at the bottom of the moderate allocation charts. In old threads at the time, I pointed out the same issue with it really being aggressive allocation. Likewise, many got into FMSDX thinking that it is conservative allocation (M* 30-50%) doing well but now it is really moderate allocation (M* 50-70%).
|
|
|
Post by flipperxxx on Aug 15, 2021 0:54:32 GMT
Hi fliperxxx just pondering ... Why don't you do an instant Xray analysis on your portfolio? I'm thinking that you will find that you are only about 12% in equity ... if indeed ... you have 20% of your portfolio split equally between PRWCX (70% equity) and VTMFX (47% equity) and hold no other funds that have an equity component. And, besides, if you were to sell down these two holdings what would you do with the cash? Bond funds have risk as well. oldskeet: exactly the problem i'd face should i sell. and i bet you're right -- i'm only about 12% equity. which shouldn't be hard to hold. but when PRWCX and VTMFX get hit hard, the bonds they hold tend to move in lock-step fashion, providing not quite the warm-fuzzies one might hope for. best for me to just shut my eyes and ride it out. at my age, it'll be my daughter's problem (so to speak) soon enough anyhow.
|
|
|
Post by paulr888 on Aug 15, 2021 1:28:05 GMT
jongaltiii , fund category mismatch draw my attention. I have no problem if FBALX is identified in the aggressive allocation category (M* 70-85%). In up-market, it would show up near the top of the chart in misclassified moderate allocation category (M* 50-70%) or category ranks. It was not too long ago when FBALX holders wondered early last year why FBALX was at the bottom of the moderate allocation charts. In old threads at the time, I pointed out the same issue with it really being aggressive allocation. Likewise, many got into FMSDX thinking that it is conservative allocation (M* 30-50%) doing well but now it is really moderate allocation (M* 50-70%). YBB .. Fidelity website has FMSDX as 30% - 50%. Shouldn't they of all people be more accurate. See below and go all the way down page to Trended Asset Allocation. I see lots of dispersion. fundresearch.fidelity.com/mutual-funds/analysis/31638R717?type=sq-NavBar&documentType=QFRAnd from Investment Approach tab: Unconstrained by target asset allocation profiles or benchmark weights, the fund dynamically pursues attractive income and value opportunities across asset classes, while closely monitoring interest rate, equity and credit risk. This flexibility helps the fund adapt to market conditions, with the goal of generating capital appreciation in rising markets and mitigating losses in declining markets.
|
|
mrc
Lieutenant
Posts: 104
|
Post by mrc on Aug 15, 2021 1:43:36 GMT
FBALX Prospectus says that it will invest approximately 60% at any time. It may sway above or below that % often, but on an average I think it stays in Moderate Allocation over a long period.
One other thing is that some of these balanced funds - FBALX, JBALX, some of the Trow Price balanced funds like Spectrum, personal strategy (I believe they changed the name of this series of funds a while ago), and even their global allocation fund RPGAX - always leaned towards growth stocks for their stock allocation, whereas traditionally majority of balanced funds invested their stock portion in value stocks. You can think of VWELX, DODBX, PRWCX, OAKBX, FPACX, BUFBX, etc. However, increasingly in the last 10 years or so, some of these value leaning managers are also buying growth stocks. VWELX is one of the example of this trend.
|
|
|
Post by FD1000 on Aug 15, 2021 12:44:10 GMT
FBALX Prospectus says that it will invest approximately 60% at any time. It may sway above or below that % often, but on an average I think it stays in Moderate Allocation over a long period. One other thing is that some of these balanced funds - FBALX, JBALX, some of the Trow Price balanced funds like Spectrum, personal strategy (I believe they changed the name of this series of funds a while ago), and even their global allocation fund RPGAX - always leaned towards growth stocks for their stock allocation, whereas traditionally majority of balanced funds invested their stock portion in value stocks. You can think of VWELX, DODBX, PRWCX, OAKBX, FPACX, BUFBX, etc. However, increasingly in the last 10 years or so, some of these value leaning managers are also buying growth stocks. VWELX is one of the example of this trend. The above is not accurate. Let's just take PRWCX,BUFBX to make my point. Good managers don't lock themselves in a box, but look at several categories and especially good companies. I marked below companies that are not value. Attachments:
|
|
mrc
Lieutenant
Posts: 104
|
Post by mrc on Aug 15, 2021 17:57:22 GMT
FD,
Either I did not clearly communicate or you did not read it properly. Either way, when M* categorizes funds into one of the 9 style categories, it does not mean that 100% of the portfolio of stocks are invested only in that style box (I understand that you are aware of it, but mentioning it for clarity), obviously they are spread across multiple style boxes, but centroid placed in one of the style boxes to which majority of the stocks in the portfolio belongs to.
I do not have data to showcase you, but I am sure that those funds I mentioned above historically Large Value leaning with majority of the stocks in that style box. Of course, most of the balanced fund managers have been moving increasingly towards large growth stocks moving their funds investment style into Large Blend category. This trend has become more evident since 2008 bear market. I mentioned VWELX as an example, but other fund shops are also doing. Oak Mark is another example. You can add PRWCX also in that category. You may say that David Giroux is investing in this fashion since he took over, but I am talking about since inception of the fund. Moreover David's takeover (2006) almost coincided with the 2008 bear market.
I mentioned this in another thread. What these mangers are doing is nothing new and Buffett did the same at the insistence of Charlie Munger
"Charlie Munger changed my views - he refined them in a huge way, in terms of looking for the quality companies, and looking out for the ability to make an investment that will work out for five or 10 or 20 years as opposed to something where there might be one more puff left in the cigar. And that worked OK, but it was small-scale and it really doesn't build anything satisfying. So he kept forcing me in the direction of saying 'is this really a business that we want to own for forever?'"
|
|
|
Post by FD1000 on Aug 15, 2021 19:29:03 GMT
FD, Either I did not clearly communicate or you did not read it properly. Either way, when M* categorizes funds into one of the 9 style categories, it does not mean that 100% of the portfolio of stocks are invested only in that style box (I understand that you are aware of it, but mentioning it for clarity), obviously they are spread across multiple style boxes, but centroid placed in one of the style boxes to which majority of the stocks in the portfolio belongs to. I do not have data to showcase you, but I am sure that those funds I mentioned above historically Large Value leaning with majority of the stocks in that style box. Of course, most of the balanced fund managers have been moving increasingly towards large growth stocks moving their funds investment style into Large Bled category. This trend has become more evident since 2008 bear market. I mentioned VWELX as an example, but other fund shops are also doing. Oak Mark is another example. You can add PRWCX also in that category. You may say that David Giroux is investing in this fashion since he took over, but I am talking about since inception of the fund. Moreover David's takeover (2006) almost coincided with the 2008 bear market. I mentioned this in another thread. What these mangers are doing is nothing new and Buffett did the same at the insistence of Charlie Munger "Charlie Munger changed my views - he refined them in a huge way, in terms of looking for the quality companies, and looking out for the ability to make an investment that will work out for five or 10 or 20 years as opposed to something where there might be one more puff left in the cigar. And that worked OK, but it was small-scale and it really doesn't build anything satisfying. So he kept forcing me in the direction of saying 'is this really a business that we want to own for forever?'" What Is a Value Stock?( link) A value stock is trading at levels that are perceived to be below its fundamentals. Common characteristics of value stocks include high dividend yield, low P/B ratio, and a low P/E ratio.A value stock typically has a bargain-price as investors see the company as unfavorable in the marketplace. "VALUE" is also a term that MAY means different things to different managers/investors. I understand exactly what you meant, but DO NOT agree. I had 2 attachments that show PRWCX has plenty of non "VALUE" stocks and why it's a blend fund. Why would I look at what happened 20-30 years ago? Giroux is a flexible manager who would buy what he thinks is best according to market conditions, and why he has been buying different style stocks. PRWCX pays lower dist (including bonds) than the SP500 (all stocks), another proof it's not a value fund. Buffett has a big holding in APPLE, which is not a value stock. BUFBX top 10 companies are mostly not "value". VWELX isn't a value fund either with so many non value stocks. See attachment. BTW, 30 days sec is 1.26%(including 33% in bonds) while VFINX(SP500)=1.2%(all stocks) which is another proof it's not a value fund. Attachments:
|
|
mrc
Lieutenant
Posts: 104
|
Post by mrc on Aug 15, 2021 19:44:11 GMT
FD,
Frankly, I do not understand what you DO NOT agree.
I thought I said the same of what you are saying and also quoted Buffet's answer/explanation for that. 'Value' definition in Buffet's view changed long ago when he bought stocks like Coke when they were growth stocks (Apple came into his portfolio much later). His view of value changed from the traditional definition long ago influenced by Charlie Munger. I have said many Mutual fund managers have also changed their view of 'Value', especially after 2008 downturn.
Anyway, let's leave it at that.
|
|
bf22
Commander
Posts: 135
|
Post by bf22 on Aug 16, 2021 5:19:32 GMT
FD, Frankly, I do not understand what you DO NOT agree. I thought I said the same of what you are saying and also quoted Buffet's answer/explanation for that. 'Value' definition in Buffet's view changed long ago when he bought stocks like Coke when they were growth stocks (Apple came into his portfolio much later). His view of value changed from the traditional definition long ago influenced by Charlie Munger. I have said many Mutual fund managers have also changed their view of 'Value', especially after 2008 downturn. Anyway, let's leave it at that. I agree, the top balanced funds have been using more growth stocks than in the (distant) past. And that's a good thing. This is what you would expect from a good balanced fund. No need to argue about this...
|
|
|
Post by Norbert on Aug 16, 2021 9:04:56 GMT
anitya, I just want to offer more gratuitous advice. It's this: asset allocation is of high importance; fund selection is secondary. I suggest looking in the mirror and figuring out your pain threshold. That's to avoid what's probably the worst mistake an investor can make: panic selling. Equity funds are mostly very correlated. Could you handle a 30-50% decline in portfolio value without blinking? If yes, that's great. If not, beware. That's all. Pretty obvious, I guess. Norbert
|
|
|
Post by ignatz on Aug 16, 2021 11:30:08 GMT
anitya , Equity funds are mostly very correlated. Could you handle a 30-50% decline in portfolio value without blinking? If yes, that's great. If not, beware............Pretty obvious, I guess.
Pretty obvious? Yes. But rarely heeded and taken to heart.
So it may as well be highly obscure and known only to a very few.
Better to continue yammering about excruciating minutiae and whether I should stick with my emerging small cap value or swap it for junior gold miners for that 2 percent slice.
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Aug 16, 2021 13:30:17 GMT
anitya , I just want to offer more gratuitous advice. It's this: asset allocation is of high importance; fund selection is secondary. I suggest looking in the mirror and figuring out your pain threshold. That's to avoid what's probably the worst mistake an investor can make: panic selling. Equity funds are mostly very correlated. Could you handle a 30-50% decline in portfolio value without blinking? If yes, that's great. If not, beware. That's all. Pretty obvious, I guess. Norbert I agree with Norbert. This is why I have as little as I can stand in cash and bonds. As little as I can stand is enough to give my portfolio time to recover from a 50% or worse hit - I have that time as 10 years if necessary. I will be pounding the keyboards here to get hold the line support if and when that comes! In that sense asset allocation is of great importance. Some other observations - those who state the S&P500 index is the best way to invest. For the last 10 years, that is probably true - but why? Because of those 5 or six stocks which DOMINATE the index. I have matched the S&P because I have outsize holdings in several of those and I give those stocks, not the index, the credit for the return. How the next 10 years goes is to be determined. If I am recommending investing in a market index, I am recommending that investors will earn the long term market average - period. And, some of my holdings - APPL and FB - were bought as value stocks - APPL had over a 2% dividend at the time. Where to invest now? As far as I am concerned (and with my timeline) - cash is trash right now, so hold as little as to avoid panicking. I would buy any of the FAANG or MSFT in the 20s p/es. My exception has been Amazon (and maybe should have been Microsoft) - which has so much going for it in AWS that I was willing to buy at a higher price after the last earnings disappointment. I still think that we are in an economic boom, characterized by increased productivity, higher wages, and moderate inflation. Equities, unlike bonds (didn't VBLTX outperform SPY from 1999 to 2019?) are where I would be investing. I would hedge a bit with developed and emerging markets. I would not be basing my future forecasts on what has worked for the last 10 years because some large macro economic factors are changing - results TBD - just wouldn't count on the same-same, or at least for the same reasons (the FED). Commodities are for traders in my opinion - they have never been a good friend to me. I have very little there. I always like a good solid blue chip, with a nice history of an increasing dividend supported by earnings, at a fair price - thank you Josh Peters! Happy investing in this very interesting time!
|
|
|
Post by FD1000 on Aug 16, 2021 14:06:34 GMT
@slooow : I would not be basing my future forecasts on what has worked for the last 10 years FD: well, I have been reading/hearing this argument for several years already, especially from "experts" like Shiller that many are quoting from. Cape is high since 2014 maybe 2011( link). Investor who diversified in the last 7 years got lower performance + higher SD = double knockout. For years now, I have read that next year, EM stocks will do better, every year that passes they continue saying...how long can US LC dominate? It also depends on style, someone who buys single stocks have a lot more choices but can make more mistakes. SPY+QQQ are KISS and great for most investors. Diversification and cash? Again, for who and how much? It all boils down to style and goals. I never believed in cash prior and after retirement. I was never over diversified, I invested with fund managers that found better stocks/categories/regions to be in...until they didn't and switched to others who did. If I had to invest in stocks, I would be mainly in US LC. Bonds? My bond fund managers hardly used treasuries since 2011.
|
|
|
Post by johntaylor on Aug 16, 2021 14:12:55 GMT
Buffett talked about Ben Graham as an 85 percent influence, but said Phil FIsher's 1958 book (Common Stocks and Uncommon Profits) made up the rest
|
|
|
Post by jongaltiii on Aug 16, 2021 14:35:32 GMT
anitya , I just want to offer more gratuitous advice. It's this: asset allocation is of high importance; fund selection is secondary. I suggest looking in the mirror and figuring out your pain threshold. That's to avoid what's probably the worst mistake an investor can make: panic selling. Equity funds are mostly very correlated. Could you handle a 30-50% decline in portfolio value without blinking? If yes, that's great. If not, beware. That's all. Pretty obvious, I guess. Norbert I agree with Norbert. This is why I have as little as I can stand in cash and bonds. As little as I can stand is enough to give my portfolio time to recover from a 50% or worse hit - I have that time as 10 years if necessary. I will be pounding the keyboards here to get hold the line support if and when that comes! In that sense asset allocation is of great importance. Some other observations - those who state the S&P500 index is the best way to invest. For the last 10 years, that is probably true - but why? Because of those 5 or six stocks which DOMINATE the index. I have matched the S&P because I have outsize holdings in several of those and I give those stocks, not the index, the credit for the return. How the next 10 years goes is to be determined. If I am recommending investing in a market index, I am recommending that investors will earn the long term market average - period. And, some of my holdings - APPL and FB - were bought as value stocks - APPL had over a 2% dividend at the time. Where to invest now? As far as I am concerned (and with my timeline) - cash is trash right now, so hold as little as to avoid panicking. I would buy any of the FAANG or MSFT in the 20s p/es. My exception has been Amazon (and maybe should have been Microsoft) - which has so much going for it in AWS that I was willing to buy at a higher price after the last earnings disappointment. I still think that we are in an economic boom, characterized by increased productivity, higher wages, and moderate inflation. Equities, unlike bonds (didn't VBLTX outperform SPY from 1999 to 2019?) are where I would be investing. I would hedge a bit with developed and emerging markets. I would not be basing my future forecasts on what has worked for the last 10 years because some large macro economic factors are changing - results TBD - just wouldn't count on the same-same, or at least for the same reasons (the FED). Commodities are for traders in my opinion - they have never been a good friend to me. I have very little there. I always like a good solid blue chip, with a nice history of an increasing dividend supported by earnings, at a fair price - thank you Josh Peters! Happy investing in this very interesting time! @slooow - I think you may have mixed up your sentence... " didn't VBLTX outperform SPY from 1999 to 2019?" I don't believe that is true. Even by cherry picking the 3 bad years to include poor SPY performance 2000-2002 - no I don't believe that Bonds outperformed S&P for that time period. But I do agree with your conclusion/statement that "equities are where I would be investing".
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Aug 16, 2021 17:19:27 GMT
Hi j - I might have gotten the bond symbol wrong, See awealthofcommonsense.com/2020/06/how-often-do-long-term-bonds-beat-stocks/. Admittedly, it is cherry picking. It is also an example of crafting the past to look like something it isn't. I am a firm believe that over the long term, you will earn the mean return. I think it is irrelevant what the US market (stock and bonds) did for the last 10 years or year. To me, that's a crap shoot. If you invest in an index, you should expect the mean return and what you get in the meantime is anyone's guess. If you invest in a company, you might have an edge or a dividend. Absolutely - equities are the better place to be.
|
|
|
Post by Chahta on Aug 16, 2021 17:30:41 GMT
anitya , Equity funds are mostly very correlated. Could you handle a 30-50% decline in portfolio value without blinking? If yes, that's great. If not, beware............Pretty obvious, I guess.
Pretty obvious? Yes. But rarely heeded and taken to heart.
So it may as well be highly obscure and known only to a very few.
Better to continue yammering about excruciating minutiae and whether I should stick with my emerging small cap value or swap it for junior gold miners for that 2 percent slice.
By necessity it is prudent to have 1-2 years in cash-like UST or ST bond OEFs as a bridge to better times. Imagine having to slaughter your IRA for a couple of years taking $100k out at 50% value. Or have a steelpony10 type of CEF 9% income generator and hold on to your hat.
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Aug 16, 2021 18:16:28 GMT
Pretty obvious? Yes. But rarely heeded and taken to heart.
So it may as well be highly obscure and known only to a very few.
Better to continue yammering about excruciating minutiae and whether I should stick with my emerging small cap value or swap it for junior gold miners for that 2 percent slice.
By necessity it is prudent to have 1-2 years in cash-like UST or ST bond OEFs as a bridge to better times. Imagine having to slaughter your IRA for a couple of years taking $100k out at 50% value. Or have a steelpony10 type of CEF 9% income generator and hold on to your hat. Even more prudent to have more if you ask me. I am 8 years away from retirement ( maybe sooner) and I am keeping 15% of portfolio liquid. Agree you need to have a cash/bond cushion. There could be another huge swoon - probably not - but there sure might be. Maybe I will need to retire sooner than planned. Possible too. As Norbert suggested - I took a long hard look in the mirror and confirmed I need that safety net to help me sleep well and not jump off a building!
|
|
|
Post by FD1000 on Aug 16, 2021 19:30:55 GMT
Why a typical retiree must have 2 years in cash? A typical retiree have at least 40% (if not 50%) in bonds. If she doesn't, it means she didn't save enough or she has a large enough portfolio or maybe a big enough pension and why she has 70-80% and more in stocks.
So, why 40% bonds can't sustain you for 2 years(except the feel good answer)? After all, if you saved enough and need max 4%(even 5%) from your portfolio, then 40% looks as a pretty good cushion.
BTW, if part of these 40% are in CEFs, they are a portion of your stocks. At 40% bonds, you better have 75% in core/core+ bonds.
|
|
|
Post by steelpony10 on Aug 16, 2021 20:33:38 GMT
Why a typical retiree must have 2 years in cash? A typical retiree have at least 40% (if not 50%) in bonds. If she doesn't, it means she didn't save enough or she has a large enough portfolio or maybe a big enough pension and why she has 70-80% and more in stocks. So, why 40% bonds can't sustain you for 2 years(except the feel good answer)? After all, if you saved enough and need max 4%(even 5%) from your portfolio, then 40% looks as a pretty good cushion. BTW, if part of these 40% are in CEFs, they are a portion of your stocks. At 40% bonds, you better have 75% in core/core+ bonds. FD - I have 80% in stocks then who knew? That’s crazy. I have about 10 years in cash and munis though. So I suppose it depends. Maybe I have a large portfolio or I’m cheap. I still don’t spend down either. Sorta makes me wonder how it all works. My answer is I don’t think I’m cheap and what’s a large portfolio? I just can’t spend enough where and how I live. So less then 4%. That’s how I got there. Money means security to me not Porsches. As far as the OP, anitya , you bet on the big winning category the last 30 years. DCA if it hurts to just get if over with.
|
|
|
Post by FD1000 on Aug 16, 2021 21:43:35 GMT
Why a typical retiree must have 2 years in cash? A typical retiree have at least 40% (if not 50%) in bonds. If she doesn't, it means she didn't save enough or she has a large enough portfolio or maybe a big enough pension and why she has 70-80% and more in stocks. So, why 40% bonds can't sustain you for 2 years(except the feel good answer)? After all, if you saved enough and need max 4%(even 5%) from your portfolio, then 40% looks as a pretty good cushion. BTW, if part of these 40% are in CEFs, they are a portion of your stocks. At 40% bonds, you better have 75% in core/core+ bonds. FD - I have 80% in stocks then who knew? That’s crazy. I have about 10 years in cash and munis though. So I suppose it depends. Maybe I have a large portfolio or I’m cheap. I still don’t spend down either. Sorta makes me wonder how it all works. My answer is I don’t think I’m cheap and what’s a large portfolio? I just can’t spend enough where and how I live. So less then 4%. That’s how I got there. Money means security to me not Porsches. As far as the OP, anitya , you bet on the big winning category the last 30 years. DCA if it hurts to just get if over with. Looks fantastic to me, with 80% in stocks and 20% in cash + Munis...so maybe 10% in cash. It means you got it made, and the volatility doesn't bother you. You said "I’m cheap. I still don’t spend down either." I think you meant frugal. 1. Cheap and frugal people both love to save money, but frugal people will not do so at the expense of others. 2. Frugality is about assessing the bigger picture and having the patience to cash in on the simple savings strategies. 3. Cheapness uses price as a bottom line; frugality uses value as a bottom line. 4. Cheap people are driven by saving money regardless of the cost; frugal people are driven by maximizing total value, including the value of their time. 5. Being cheap is about spending less; being frugal is about prioritizing your spending so that you can have more of the things you really care about.
|
|
|
Post by steelpony10 on Aug 16, 2021 22:51:01 GMT
FD1000 , I don’t think I’m cheap or frugal. Raised by Depression Era parents taught by Depression Era mentors. associating with peers from the same background for the first 23 yrs+. Money means security that’s all. That’s why once I solved the security problem I was done. Gambling is not a pastime other then poker during the winter months. Just like my father and father in law. Lol. I really consider CEF’s, the first part I organized as income to pay bills plus some slop, more like a pension type investment not an equity. Of course unlike a pension it’s volatile but if the payout stays about the same I don’t care. I realize I’m giving up bigger cap gains if they occur for that steady reliable cash flow. So 40/40/20 was a fluke because I needed that 40% cash flow, a counter to that for growth and a safe place to stash the excess income. As an aside I was an early investor in WinTel and AAPL and dumped INTC for AMZN during the bank crisis while I was converting 40% to CEF’s. Those moves made all the difference really. That was the plan and there was my opening. Volatility was my friend. 2020 offered the same opportunity.
|
|
|
Post by anitya on Aug 16, 2021 23:42:19 GMT
A quick digression to FBALX and FMSDX - Yogi can give you a scientific answer but my eyeball observation has been that in the past year + their correlation with the equity market volatility is much higher than their stated equity %age suggests. The returns have not been corresponding to the volatility - of course, it does not say anything about the future! P.S.: I currently have a 5% position in FBALX (a few years old) and an experimental position in FMSDX. I am unlikely to use the money from this thread to elevate FMSDX. BTW, when I say starter position elsewhere, I mean experimental position. I am pretty close to shutting down the experiment with FMSDX. I do not think I will ever build it up.
|
|
|
Post by jongaltiii on Aug 17, 2021 0:02:19 GMT
A quick digression to FBALX and FMSDX - Yogi can give you a scientific answer but my eyeball observation has been that in the past year + their correlation with the equity market volatility is much higher than their stated equity %age suggests. The returns have not been corresponding to the volatility - of course, it does not say anything about the future! P.S.: I currently have a 5% position in FBALX (a few years old) and an experimental position in FMSDX. I am unlikely to use the money from this thread to elevate FMSDX. BTW, when I say starter position elsewhere, I mean experimental position. I am pretty close to shutting down the experiment with FMSDX. I do not think I will ever build it up. anitya it’s up 13.51% YTD and up 3.01% the last 30 days. I’m very happy with it so far. Feels a bit more “conservative” than FBALX etc. So far so good for me.
|
|
bf22
Commander
Posts: 135
|
Post by bf22 on Aug 17, 2021 0:09:16 GMT
A quick digression to FBALX and FMSDX - Yogi can give you a scientific answer but my eyeball observation has been that in the past year + their correlation with the equity market volatility is much higher than their stated equity %age suggests. The returns have not been corresponding to the volatility - of course, it does not say anything about the future! P.S.: I currently have a 5% position in FBALX (a few years old) and an experimental position in FMSDX. I am unlikely to use the money from this thread to elevate FMSDX. BTW, when I say starter position elsewhere, I mean experimental position. I am pretty close to shutting down the experiment with FMSDX. I do not think I will ever build it up. Why, what's the reason?
|
|
|
Post by fishingrod on Aug 17, 2021 0:50:57 GMT
I have to agree with FD1000 , or is that Stephanie O'Connell?
"Those who are cheap are often afraid to spend money. They are willing to sacrifice quality, value and time in order to cash in on some short-term savings." -Stephanie O'Connell.
Stefanie O'Connell is a New York City based actress and freelance writer.
|
|