Mathjak's Market Calls
Moderator: Global Moderator
- buddtholomew
- Executive Member
- Posts: 2464
- Joined: Fri May 21, 2010 4:16 pm
Re: Mathjak's Market Calls
So at this point we're not only talking about indexing but also managed funds versus the performance of the PP. This is where I step out of the room.
"The first principle is that you must not fool yourself and you are the easiest person to fool" --Feynman.
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
well note the title on the thread .
tom asked me to post the portfolio i use and the changes as i make them . it wasn't about anything else .
tom asked me to post the portfolio i use and the changes as i make them . it wasn't about anything else .
Re: Mathjak's Market Calls
I'll play this game. I'm 50% cash and 50% intermediate bonds now. I got out when S&P500 was about 1950
keywords so I can find this thread later when it's time to re-invest: mebane faber ivy timing 10 month moving average ochotona
keywords so I can find this thread later when it's time to re-invest: mebane faber ivy timing 10 month moving average ochotona
Last edited by ochotona on Mon Sep 28, 2015 7:30 pm, edited 1 time in total.
Re: Mathjak's Market Calls
Yep, that's the game. Whatever you're using, funds or not. Will be interesting to see. The key is to properly track when and how much you by and sell in and out of things, regardless of how much or often.mathjak107 wrote: well note the title on the thread .
tom asked me to post the portfolio i use and the changes as i make them . it wasn't about anything else .
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
you got it!
-
- Executive Member
- Posts: 387
- Joined: Tue Jan 01, 2013 8:19 pm
Re: Mathjak's Market Calls
MJ, out of curiosity, how did you respond to the market crashes of 2000-02 and 2008?mathjak107 wrote:
tom asked me to post the portfolio i use and the changes as i make them . it wasn't about anything else .
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
great question .
first i will tell you what my gut reaction would have been . i think my gut reaction would have been , when there is a fire run for the exits .
but the fact that by following the newsletter i did not have to concern myself at all with portfolio decisions and so we just turned off all the noise , went about our lives and spent all of 30 seconds a week seeing if there were any fund swaps .
by the time i took an interest in listening to he noise we were well on the way to recovery . in the end it was a non event .
first i will tell you what my gut reaction would have been . i think my gut reaction would have been , when there is a fire run for the exits .
but the fact that by following the newsletter i did not have to concern myself at all with portfolio decisions and so we just turned off all the noise , went about our lives and spent all of 30 seconds a week seeing if there were any fund swaps .
by the time i took an interest in listening to he noise we were well on the way to recovery . in the end it was a non event .
Last edited by mathjak107 on Thu Oct 01, 2015 1:34 pm, edited 1 time in total.
Re: Mathjak's Market Calls
Mathjak, I believe that you are going to seriously outperform the PP from today to the end of the year!
- bitcoininthevp
- Executive Member
- Posts: 465
- Joined: Fri Sep 25, 2015 8:30 pm
Re: Mathjak's Market Calls
Kudos to Mathjak for accepting the troubles of posting any changes here and the accountability of putting his money where his mouth is in a sense. Will be fun to watch!
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
i will also post the insight weekly results since those they post daily and are easy for me to just grab and run for a point of reference
. they post after 8pm .
perhaps if you are happy with those numbers you may want to give them a shot .
. they post after 8pm .
perhaps if you are happy with those numbers you may want to give them a shot .
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
okay here are the fidelity insight results for comparison . it is a very popular newsletter that uses only managed fidelity funds and i have been using it for decades right up until i retired .
the growth model which is 100% equity is now down -3.34% ytd .
to give you an idea of performance , 100k 12/31/1986 is now 2 million .
all the models have different dates they were created and put live ..
the growth and income model which is 68% equity the rest assorted bond funds (intermediate term is down 2.78% started 12/31/1993 100k is now 560,000
the income and capital preservation model , which is more conservative than the pp at 25% equity and the rest assorted bond funds ranging from short to intermediate down 1.18% started 12/31/1991 , 100k is 360k today
where is the 4x4 pp ytd ? i would think down about 4% or so ?
what would the pp returns have been in comparison for those years ?
the growth model which is 100% equity is now down -3.34% ytd .
to give you an idea of performance , 100k 12/31/1986 is now 2 million .
all the models have different dates they were created and put live ..
the growth and income model which is 68% equity the rest assorted bond funds (intermediate term is down 2.78% started 12/31/1993 100k is now 560,000
the income and capital preservation model , which is more conservative than the pp at 25% equity and the rest assorted bond funds ranging from short to intermediate down 1.18% started 12/31/1991 , 100k is 360k today
where is the 4x4 pp ytd ? i would think down about 4% or so ?
what would the pp returns have been in comparison for those years ?
Last edited by mathjak107 on Thu Oct 01, 2015 7:34 pm, edited 1 time in total.
- MachineGhost
- Executive Member
- Posts: 10054
- Joined: Sat Nov 12, 2011 9:31 am
Re: Mathjak's Market Calls
Does it use momentum to rotate into the different funds?mathjak107 wrote: okay here are the fidelity insight results for comparison . it is a very popular newsletter that uses only managed fidelity funds and i have been using it for decades right up until i retired .
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
no not all . it just looks at the big picture and matches a funds weighting . maybe we have 2 or 3 fund swps at most a year .
- MachineGhost
- Executive Member
- Posts: 10054
- Joined: Sat Nov 12, 2011 9:31 am
Re: Mathjak's Market Calls
What does that mean, "the big picture"? How does that translate into choosing funds and swapping them?mathjak107 wrote: no not all . it just looks at the big picture and matches a funds weighting . maybe we have 2 or 3 fund swps at most a year .
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
manager changes at the fund , weightings in a fund changing drastically , rising rates, rising inflation , weak dollar , strong dollar , etc .
do they get it right every time ? no but then you don't do better then the index at the worst case . most of the time they do get these things correct and so it adds alpha to the portfolio .
do they get it right every time ? no but then you don't do better then the index at the worst case . most of the time they do get these things correct and so it adds alpha to the portfolio .
Last edited by mathjak107 on Thu Oct 01, 2015 8:01 pm, edited 1 time in total.
Re: Mathjak's Market Calls
My understanding is that it's rare for a manager to beat the index, and that none of them can do so repeatedly or predictably.mathjak107 wrote: manager changes at the fund , weightings in a fund changing drastically , rising rates, rising inflation , weak dollar , strong dollar , etc .
do they get it right every time ? no but then you don't do better then the index at the worst case . most of the time they do get these things correct and so it adds alpha to the portfolio .
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
Don't confuse a manager beating an index with the fund.
There are thousands of small funds with mangers that are pretty good but the funds are small and the fees run high and expenses for lots of things are the same if you are a big fund or a small fund ..
When you actually look at investor money 80% of investor money is in 20% of the largest funds and many do beat there indexes because the fees are lower.
You have index funds today in 401 k plans with high fees and they suck .
There was just an article in forbes about the fact that fidelity's large cap funds beat their indexes 6 out of the last 7 years almost across the board . The difference between indexing and those funds was 35 billion dollars.
But in this case we are talking a portfolio. The funds individually don't have to beat their index but because you are swapping them out at times you are cherry picking the best time for each.
So if you have a fund that is weighted for a strong dollar you exploit it and then when the dollar weakens swap it for a better weighted choice.
A few months ago a fund that was heavy in biotech was swapped for one in consumer staples to lessen risk and volatility. Ended up a great move.
Neither fund may beat their index but working together they both do.
There are thousands of small funds with mangers that are pretty good but the funds are small and the fees run high and expenses for lots of things are the same if you are a big fund or a small fund ..
When you actually look at investor money 80% of investor money is in 20% of the largest funds and many do beat there indexes because the fees are lower.
You have index funds today in 401 k plans with high fees and they suck .
There was just an article in forbes about the fact that fidelity's large cap funds beat their indexes 6 out of the last 7 years almost across the board . The difference between indexing and those funds was 35 billion dollars.
But in this case we are talking a portfolio. The funds individually don't have to beat their index but because you are swapping them out at times you are cherry picking the best time for each.
So if you have a fund that is weighted for a strong dollar you exploit it and then when the dollar weakens swap it for a better weighted choice.
A few months ago a fund that was heavy in biotech was swapped for one in consumer staples to lessen risk and volatility. Ended up a great move.
Neither fund may beat their index but working together they both do.
Last edited by mathjak107 on Fri Oct 02, 2015 4:47 am, edited 1 time in total.
- MachineGhost
- Executive Member
- Posts: 10054
- Joined: Sat Nov 12, 2011 9:31 am
Re: Mathjak's Market Calls
I guess the question is if you would have done better without all the swapping since that incurs transanction costs and taxes as well as the drag of underperforming due to the higher fees of actively managed funds?
Yet, I still think this sounds like some kind of momentum. There's no way to consistently earn more than the market index without using that and compounding the short-term alpha. Unless you had a perfect crystal ball for the business cycle!
Yet, I still think this sounds like some kind of momentum. There's no way to consistently earn more than the market index without using that and compounding the short-term alpha. Unless you had a perfect crystal ball for the business cycle!
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
there is no way to know how you would have done doing something else , ever , even indexing .
different buy points , adding money at different times , different sell points , different rebalance points . there are so many variables even if you indexed you likely would never no .
i can say this , picking a reference like the s&p 500 the growth model blew it away if you look at the lab results .
a 100k invested in the growth model on the start day in 1986 was worth almost 500k more than the s&p 500 so i would say that it had a pretty good track record up to today .
the problem with many good funds is they are bound by design to only certain types of stocks . as an example typically a fund like fidelity export and multi national is a fund that buys only us stocks with big presence over seas . at times it is a great fund but other times not the place to be . but by having the ability in your own portfolio to swap you can extract the best of times for certain funds and use something else when that ran its course .
believe it or not it is only 2 or 3x in a year that an older fund may be replaced . quite a few funds in the models have been in them for decades . it isn't all the equity funds that get swapped ,
http://www.fidelityinsight.com/about/pe ... f2012.html
different buy points , adding money at different times , different sell points , different rebalance points . there are so many variables even if you indexed you likely would never no .
i can say this , picking a reference like the s&p 500 the growth model blew it away if you look at the lab results .
a 100k invested in the growth model on the start day in 1986 was worth almost 500k more than the s&p 500 so i would say that it had a pretty good track record up to today .
the problem with many good funds is they are bound by design to only certain types of stocks . as an example typically a fund like fidelity export and multi national is a fund that buys only us stocks with big presence over seas . at times it is a great fund but other times not the place to be . but by having the ability in your own portfolio to swap you can extract the best of times for certain funds and use something else when that ran its course .
believe it or not it is only 2 or 3x in a year that an older fund may be replaced . quite a few funds in the models have been in them for decades . it isn't all the equity funds that get swapped ,
http://www.fidelityinsight.com/about/pe ... f2012.html
Last edited by mathjak107 on Fri Oct 02, 2015 4:46 am, edited 1 time in total.
-
- Executive Member
- Posts: 705
- Joined: Sat Sep 13, 2014 4:20 am
Re: Mathjak's Market Calls
MJ,
Would you please address the tax question. Does swapping funds create a tax burden for you?
Thanks.
Would you please address the tax question. Does swapping funds create a tax burden for you?
Thanks.
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
not until recently since equity's were in the retirement account . but after the sale of some property's we have them in a brokerage account too .
the taxes are a mixed bag . the zero to 15% rate is a lot better then my regular rate it it was money coming out of the retirement account , especially when rmds get added so tax wise it is not a much bigger difference . there are few swaps in a year so it has not been a problem .
there is a positive side to paying some taxes yearly and that is 30 years of gains in an index fund can be pretty complex dealing with down the road when you have 30 years of pent up taxes if you want to make portfolio changes .
i would say the taxes may hurt a little but if performance is better it is worth it . so in the long term i would have to say it may be better to get the performance and pay the tax . but most folks will have equity's in their retirement accounts .
the taxes are a mixed bag . the zero to 15% rate is a lot better then my regular rate it it was money coming out of the retirement account , especially when rmds get added so tax wise it is not a much bigger difference . there are few swaps in a year so it has not been a problem .
there is a positive side to paying some taxes yearly and that is 30 years of gains in an index fund can be pretty complex dealing with down the road when you have 30 years of pent up taxes if you want to make portfolio changes .
i would say the taxes may hurt a little but if performance is better it is worth it . so in the long term i would have to say it may be better to get the performance and pay the tax . but most folks will have equity's in their retirement accounts .
Last edited by mathjak107 on Fri Oct 02, 2015 6:11 am, edited 1 time in total.
-
- Executive Member
- Posts: 705
- Joined: Sat Sep 13, 2014 4:20 am
Re: Mathjak's Market Calls
Thanks, MJ
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
so we ended the week with :
the growth model down 1.88% ytd
growth and income model down 1.77%
income and capital preservation model down just .58%
s&p 500 down 1.93% ytd
pp with vti ,gld ,tlt and cash is down about 1.75% equal to the 70/30 growth and income model and 100% equity growth model .
so far this years winner is the conservative income and capital preservation model only down .58% ytd.
the growth model down 1.88% ytd
growth and income model down 1.77%
income and capital preservation model down just .58%
s&p 500 down 1.93% ytd
pp with vti ,gld ,tlt and cash is down about 1.75% equal to the 70/30 growth and income model and 100% equity growth model .
so far this years winner is the conservative income and capital preservation model only down .58% ytd.
Last edited by mathjak107 on Sat Oct 03, 2015 6:06 am, edited 1 time in total.
Re: Mathjak's Market Calls
As of October 1, the Ivy portfolio methodology was telling me to be
1/6 SCHZ = BND
1/6 BNDX Vanguard total international bond ETF
1/6 TLO = TLT
3/6 CASH
I can't buy TLT in my 401(k), so I had to do the bullet - barbell exchange.
So,
1/6 BNDX
5/12 401(k) total intermediate bond fund
5/12 401(k) short term bond fund
Should work the same. I backtested it. Good enough for government work. I can roll my 401(k) early next year. That will have to do for now.
My 12 ETF universe is an expansion of Faber's 10 ETF universe. I added TLO and BNDX. Could not add emerging bonds for reasons of conscience, and junk bonds... just seems like a bad choice at this time. No risk assets are ON at this time. Gold is asleep.
1/6 SCHZ = BND
1/6 BNDX Vanguard total international bond ETF
1/6 TLO = TLT
3/6 CASH
I can't buy TLT in my 401(k), so I had to do the bullet - barbell exchange.
So,
1/6 BNDX
5/12 401(k) total intermediate bond fund
5/12 401(k) short term bond fund
Should work the same. I backtested it. Good enough for government work. I can roll my 401(k) early next year. That will have to do for now.
My 12 ETF universe is an expansion of Faber's 10 ETF universe. I added TLO and BNDX. Could not add emerging bonds for reasons of conscience, and junk bonds... just seems like a bad choice at this time. No risk assets are ON at this time. Gold is asleep.
- mathjak107
- Executive Member
- Posts: 4456
- Joined: Fri Jun 19, 2015 2:54 am
- Location: bayside queens ny
- Contact:
Re: Mathjak's Market Calls
no equity's ?
that would never be a choice in anything i i would choose for myself .
that would never be a choice in anything i i would choose for myself .