Re: Fidelity Bond and Bill Direct Purchase ?'s
Posted: Sat Feb 08, 2020 7:40 pm
[deleted]
Permanent Portfolio Forum
https://www.gyroscopicinvesting.com/forum/
https://www.gyroscopicinvesting.com/forum/viewtopic.php?f=3&t=9836
Read everything that you (and everyone else) wrote regarding your initial questions.pmward wrote: ↑Fri Mar 08, 2019 2:22 pmYeah I think I'm going to work on building a monthly ladder of 1 year bills, but start off with 12k (4k per week) in 4 week bills on auto-roll while I'm building the 1 year bill ladder out. It will be a few years I'm sure before I have accumulated enough in 1 year bills laddered out every month. Once I get there I'll likely kill the 4 week bills and roll those to 1 year bills as well. In the meantime, it is probably better safe than sorry as far as keeping enough liquidity for the common run of the mill "emergencies" like car or home issues in 4 week bills. Also, once I've reached that point, that would probably be a good time to see what the yield curve is like and maybe extending maturity out on fresh accumulations. Probably at least a couple years before I get there though.
I also did decide I'm going to incorporate my 401k into my golden butterfly even though I have no access to LTT's or gold. I'm just going to have to do 25% TSM, 25% small cap, 50% total bond market (substituted for the bond barbell) in my 401k automatically rebalanced annually and then hold enough gold taxable to cover 20% of my total portfolio between all accounts combined. And outside my 401k I'm doing the proper LTT/STT barbell. So with that I've already got a bit more risk on the bond side of things because of the corporate bonds in TBM, so having all T-Bills in my non-401k accounts for the STT portion is probably a good tradeoff for the next few years at least. I've really grown quite fond of my golden butterfly after watching the way it has behaved day to day over the last couple of months, between both a melt up in the stock market over the last couple months, and now into a nice little sell off. It has been a nice little short term sampling of bull and bear environments in the short time I've held the portfolio. It handled both rather well and seems to fit my personality quite well. It is definitely true that you get a better feel for a portfolio once you've actually got some money on the line. I've also done a lot more research and all that has strengthened my convictions in the GB. So I think it's time to go all in! TBM in the 401k isn't optimal, but it works well enough in the grand scheme. At least since I've only been at this job for a year my 401k is smaller than my IRA's/taxable accounts, so it's never going to be the anywhere near the majority of my bond allocation.
Hey Vinny, I'm actually pretty close to the above allocation still. I'm currently basically in a GB, only I traded 5% of the cash and substituted a 5% allocation to REIT's in it's place. I also am doing the same as mentioned with bonds in my 401k. I cannot keep all bonds in IRA so I had to do some TBM as a substitute. So far things are working out well. I've become a believer. While I do still have a small allocation separate to that I actively manage, I'm finding myself growing bored with it and may just roll it into my GB, particularly if stocks continue to sell off.vnatale wrote: ↑Mon Feb 17, 2020 2:37 pmRead everything that you (and everyone else) wrote regarding your initial questions.pmward wrote: ↑Fri Mar 08, 2019 2:22 pmYeah I think I'm going to work on building a monthly ladder of 1 year bills, but start off with 12k (4k per week) in 4 week bills on auto-roll while I'm building the 1 year bill ladder out. It will be a few years I'm sure before I have accumulated enough in 1 year bills laddered out every month. Once I get there I'll likely kill the 4 week bills and roll those to 1 year bills as well. In the meantime, it is probably better safe than sorry as far as keeping enough liquidity for the common run of the mill "emergencies" like car or home issues in 4 week bills. Also, once I've reached that point, that would probably be a good time to see what the yield curve is like and maybe extending maturity out on fresh accumulations. Probably at least a couple years before I get there though.
I also did decide I'm going to incorporate my 401k into my golden butterfly even though I have no access to LTT's or gold. I'm just going to have to do 25% TSM, 25% small cap, 50% total bond market (substituted for the bond barbell) in my 401k automatically rebalanced annually and then hold enough gold taxable to cover 20% of my total portfolio between all accounts combined. And outside my 401k I'm doing the proper LTT/STT barbell. So with that I've already got a bit more risk on the bond side of things because of the corporate bonds in TBM, so having all T-Bills in my non-401k accounts for the STT portion is probably a good tradeoff for the next few years at least. I've really grown quite fond of my golden butterfly after watching the way it has behaved day to day over the last couple of months, between both a melt up in the stock market over the last couple months, and now into a nice little sell off. It has been a nice little short term sampling of bull and bear environments in the short time I've held the portfolio. It handled both rather well and seems to fit my personality quite well. It is definitely true that you get a better feel for a portfolio once you've actually got some money on the line. I've also done a lot more research and all that has strengthened my convictions in the GB. So I think it's time to go all in! TBM in the 401k isn't optimal, but it works well enough in the grand scheme. At least since I've only been at this job for a year my 401k is smaller than my IRA's/taxable accounts, so it's never going to be the anywhere near the majority of my bond allocation.
What did you actually end up doing subsequent to the above?
Vinny
And, in regards to the portion I highlighted above, almost exactly one year in, how closely did you follow your bond laddering plans and where do you currently stand with your bond ladder?pmward wrote: ↑Tue Feb 25, 2020 1:42 pmHey Vinny, I'm actually pretty close to the above allocation still. I'm currently basically in a GB, only I traded 5% of the cash and substituted a 5% allocation to REIT's in it's place. I also am doing the same as mentioned with bonds in my 401k. I cannot keep all bonds in IRA so I had to do some TBM as a substitute. So far things are working out well. I've become a believer. While I do still have a small allocation separate to that I actively manage, I'm finding myself growing bored with it and may just roll it into my GB, particularly if stocks continue to sell off.vnatale wrote: ↑Mon Feb 17, 2020 2:37 pmRead everything that you (and everyone else) wrote regarding your initial questions.pmward wrote: ↑Fri Mar 08, 2019 2:22 pmYeah I think I'm going to work on building a monthly ladder of 1 year bills, but start off with 12k (4k per week) in 4 week bills on auto-roll while I'm building the 1 year bill ladder out. It will be a few years I'm sure before I have accumulated enough in 1 year bills laddered out every month. Once I get there I'll likely kill the 4 week bills and roll those to 1 year bills as well. In the meantime, it is probably better safe than sorry as far as keeping enough liquidity for the common run of the mill "emergencies" like car or home issues in 4 week bills. Also, once I've reached that point, that would probably be a good time to see what the yield curve is like and maybe extending maturity out on fresh accumulations. Probably at least a couple years before I get there though.
I also did decide I'm going to incorporate my 401k into my golden butterfly even though I have no access to LTT's or gold. I'm just going to have to do 25% TSM, 25% small cap, 50% total bond market (substituted for the bond barbell) in my 401k automatically rebalanced annually and then hold enough gold taxable to cover 20% of my total portfolio between all accounts combined. And outside my 401k I'm doing the proper LTT/STT barbell. So with that I've already got a bit more risk on the bond side of things because of the corporate bonds in TBM, so having all T-Bills in my non-401k accounts for the STT portion is probably a good tradeoff for the next few years at least. I've really grown quite fond of my golden butterfly after watching the way it has behaved day to day over the last couple of months, between both a melt up in the stock market over the last couple months, and now into a nice little sell off. It has been a nice little short term sampling of bull and bear environments in the short time I've held the portfolio. It handled both rather well and seems to fit my personality quite well. It is definitely true that you get a better feel for a portfolio once you've actually got some money on the line. I've also done a lot more research and all that has strengthened my convictions in the GB. So I think it's time to go all in! TBM in the 401k isn't optimal, but it works well enough in the grand scheme. At least since I've only been at this job for a year my 401k is smaller than my IRA's/taxable accounts, so it's never going to be the anywhere near the majority of my bond allocation.
What did you actually end up doing subsequent to the above?
Vinny
I got impatient and just dumped it all in on the March and April auctions last year instead of laddering. In hindsight, it was nice random luck as I had ~2.5% locked in all year through all these cuts and that is rolling off this month and next. Given that rates after todays cut are now down to 1% I'm probably going to tighten up, instead of 1 year bills I'll probably just cancel the auto roll and start a new auto roll with some 3 month bills. There's no reason to lock up money for a year for these puny interest rates, I would rather stay very short with my short term treasury portion when yields are below inflation like this. Also, of note is that if I didn't have a big purchase coming down the pipe next year I would likely take another 5% away and move that towards REIT's (for a total of 10% REIT and 10% short term, which I believe is the same Tyler is in these days) to keep my fixed expense holdings in check. 10% cash would give me more than enough liquidity, if I didn't have that big expense next year.vnatale wrote: ↑Mon Mar 02, 2020 8:56 pmAnd, in regards to the portion I highlighted above, almost exactly one year in, how closely did you follow your bond laddering plans and where do you currently stand with your bond ladder?pmward wrote: ↑Tue Feb 25, 2020 1:42 pmHey Vinny, I'm actually pretty close to the above allocation still. I'm currently basically in a GB, only I traded 5% of the cash and substituted a 5% allocation to REIT's in it's place. I also am doing the same as mentioned with bonds in my 401k. I cannot keep all bonds in IRA so I had to do some TBM as a substitute. So far things are working out well. I've become a believer. While I do still have a small allocation separate to that I actively manage, I'm finding myself growing bored with it and may just roll it into my GB, particularly if stocks continue to sell off.vnatale wrote: ↑Mon Feb 17, 2020 2:37 pmRead everything that you (and everyone else) wrote regarding your initial questions.pmward wrote: ↑Fri Mar 08, 2019 2:22 pmYeah I think I'm going to work on building a monthly ladder of 1 year bills, but start off with 12k (4k per week) in 4 week bills on auto-roll while I'm building the 1 year bill ladder out. It will be a few years I'm sure before I have accumulated enough in 1 year bills laddered out every month. Once I get there I'll likely kill the 4 week bills and roll those to 1 year bills as well. In the meantime, it is probably better safe than sorry as far as keeping enough liquidity for the common run of the mill "emergencies" like car or home issues in 4 week bills. Also, once I've reached that point, that would probably be a good time to see what the yield curve is like and maybe extending maturity out on fresh accumulations. Probably at least a couple years before I get there though.
I also did decide I'm going to incorporate my 401k into my golden butterfly even though I have no access to LTT's or gold. I'm just going to have to do 25% TSM, 25% small cap, 50% total bond market (substituted for the bond barbell) in my 401k automatically rebalanced annually and then hold enough gold taxable to cover 20% of my total portfolio between all accounts combined. And outside my 401k I'm doing the proper LTT/STT barbell. So with that I've already got a bit more risk on the bond side of things because of the corporate bonds in TBM, so having all T-Bills in my non-401k accounts for the STT portion is probably a good tradeoff for the next few years at least. I've really grown quite fond of my golden butterfly after watching the way it has behaved day to day over the last couple of months, between both a melt up in the stock market over the last couple months, and now into a nice little sell off. It has been a nice little short term sampling of bull and bear environments in the short time I've held the portfolio. It handled both rather well and seems to fit my personality quite well. It is definitely true that you get a better feel for a portfolio once you've actually got some money on the line. I've also done a lot more research and all that has strengthened my convictions in the GB. So I think it's time to go all in! TBM in the 401k isn't optimal, but it works well enough in the grand scheme. At least since I've only been at this job for a year my 401k is smaller than my IRA's/taxable accounts, so it's never going to be the anywhere near the majority of my bond allocation.
What did you actually end up doing subsequent to the above?
Vinny
And, NOTE to Dualstow, this is exactly the type of thing I want to think about and plan ahead of time so that when I finally go Permanent Portfolio I'm just executing the plan in all its myriad of steps with no pauses for further thought or decisions.
Vinny