Should we ask money (loan) to the bank and pay X % interest rate to the bank and keep a PP or pay the house 100% advanced ? What would be the maximum interest rate that would make you keep the PP and a loan? Seem to be in a minority here.  We regard Residential Real Estate as a fine asset class, in...

With QE etc, continue with the belief that too much money is chasing the limited supply of assets. We know bonds are expensive with low yields after the 30 year plus bull market. Stocks as OP observes have had a good run, and now look toppy by historic valuations, see:- http://www.smithers.co.uk/pag...

Here in the UK Gov't Bonds (Gilts) are also on a tear.
All asset classes are rising together (Stocks/Bonds/Real Estate).
IMHO we are seeing too much money slopping around the system chasing a limited supply of assets.

I think I understand the PP well enough to answer this question but I though I'd toss it to all of you who are far more experienced than I am.  If I wanted to buy real estate for an investment (as a rental property) where does that fit into the PP?  Is that solely a VP investment?  Would it be fool...

I consider real estate to be a VERY poor substitute for gold. It does not have the portability, divisibility, relative immunity to government confiscation, high liquidity, or many valuable attributes that that gold has. In fact, I don't consider real estate a desirable investment at all. I "ow...

One of the key points noted from Graham's book was :- ‘Since common stocks, even of investment grade, are subject to recurrent and wide fluctuations in their prices, the intelligent investor should be interested in the possibilities of profiting from these pendulum swings.  There are two possible wa...

Bit of a coincidence.  We reduced our stocks and bonds significantly last week also.  The trigger was my wife expressing interest in a house which we suspect could come on the market.  Thought it prudent to sell stocks/bonds while they were fully valued, rather than maybe be a forced seller when bot...

UK investor here with stocks at :- 1/3rd domestic 2/3rds global but thinking maybe 100% global is optimal. We should not forget the oft quoted example of the hapless Japanese investor should he have invested 100% domestic. The currency effect for non-domestic stocks tends to cancel out over time as ...

Smarter Investing by Tim Hale is often highly recommended, and I agree as first choice. Beginners' Guide to Investment by Bernard Gray Investing for the Long Term by Robert Linggard The last two are fairly old and may be out of print, and are not as good as the first. With most investment books bein...

A year ago I was teetering on the edge of setting up a full PP with part of our assets, but concerns about the pricing of gold and LT Bonds held me back.  What is surprising is how well the PP has held up with those two asset classes in such decline.  Very impressive.  Stocks did the heavy lifting. ...

So tell me, is the S&P 500, Gold or LTT cheap? Also, posting my emotions on this forum is both therapeutic and conforting to others who may experience similar anxiety with our investments. To chip in on the conversation, an appreciation on valuations can be useful.  As commented on Bogleheads, ...

It appears as if 2 of the 3 PP assets (GLD and TLT) are the pariahs of the investment world and I am the fool that is left holding the bag. I'm starting to loathe this portfolio...perhaps it was a mistake... After the 32 year bull run for bonds and the later surge in gold, we shouldn't be surprised...

UK investor here.  The UK represents about 8% world cap.

Have settled on :-

1/3rd domestic UK
2/3rds global

Have no special insight but it feels comfortable.  Hope that helps.

'- Should I invest it all at once or dollar cost average things in over a few months?' If DCA is chosen then to be worthwhile IMHO the period to invest should at least encompass a full business cycle (4 years or so) to ensure some buying in market troughs. Not being an 'all in' sort of guy, I prefer...

I find this thread refreshing.  While a great admirer of the HBPP and MT and Craig, I find myself unable to totally commit.  My problem is that the HBPP requires me to stop thinking and just follow a system.  It is as worrying as the constant refrain from Bogleheds to just 'stay the course'. When ma...

Yes I have recently become aware of the low correlation between miners, and oil companies, versus other stocks.  As a result have been adding to a UK commodities investment trust (closed end fund) BRCI which is currently undergoing a period of weakness.

Regards

If we look at the REAL yields presently available (for a UK investor) based on long term inflation rate of 3.1% :-

Stocks            3.4%
LT Bonds          0.3%
Gold                -3.1%
Cash              -0.6%

What do you think?

Thanks for the information.  Remember I Bonds are cash, whereas TIPS are bonds and therefore if located anywhere in the PP would be in the Bond allocation.  However the last time I mentioned TIPS I was told in no uncertain terms they have no place in the PP!

While still uncertain about the best option to suit the PP, have checked own holdings built up fairly randomly over many years and find the UK stock holding to be presently 31% of stocks.

50/50 may be the safest option but we feel more comfortable at about a third.

Drifting off topic perhaps, am never too clear with the PP whether for a UK investor keeping purely to UK stocks is sensible.  The UK seems something of a backwater and represents about 8% of world stocks as far as I can recall. Clive or someone may have data on performance comparisons between UK on...

We went heavily into rental real estate here in the UK in the late 1990s when gross yields exceeded 10%, while stocks were yielding about 2%.  With hindsight it was the best move in 40 years of investing.  Rents have been increasing in line with inflation since and the capital has comfortably more t...

Thanks a lot, Storm for your comments. That is what I am planning to do, even put the cash in a fixed deposit with 4% annual return for say, 5 years. Of course, at the same time, as I am working I would have relatively good liquidity position in terms of emergency fund or living expensese, etc. Wou...

Clive wrote:

The treasury aren't issuing Inflation bonds (index linked savings certificates).



JMHO.

Is it definite that there will be no IL Savings Certs this year?  I was waiting and hoping for some news soon of a new issue.

for PP purposes, have you deviated from the FTSE UK local index? what are you using? On the face of it finding / using a FTSE Local UK index fund would be difficult as the FTSE Local UK index doesn't seem to be widely used. Pragmatically it would be a difficult case to make as all the cheap index f...

Clive wrote :- Ideally you want to be holding assets that have high volatility, inverse correlation and individually provide positive real (after inflation) gains through price appreciation and/or income. unquote The mention of inverse correlation triggered a thought that has been confusing me for s...