How safe is the stock market?
 

I apologize for the ultra noob question, but better safe than sorry so I need to ask.

I've had most of my money sitting in online savings accounts for the last few years and have been told I am a fool for not investing it. So I finally decided I am going to buy a bunch of ETF shares as recommended in the "Investing for trout 101" thread in the FAQ here.

My question is, can I feel safe investing all of my savings into this? Is there any realistic risk of a market crash that I should be concerned with? Is there any reason I'd want to leave a portion of my money in government insured savings accounts earning less interest?

Also, a bonus question for anyone friendly enough to advise me. I figure I will invest in all 4 of the suggested ETFs (DIA, QQQ, SPY & VTI) and possibly even more. Could anyone recommend which %s I might want to put into each of them, or if I'd have any reason to want to avoid one or more? If not I'll just go 25% for them all like the donk I am.

Thanks for the help guys!

Re: How safe is the stock market?
 

Here is a table offered by author Larry Swedroe, based on the 1970s bear market, showing the amount of decline for various stock/bond allocations:

Max Equity - Exposure Max loss
20%...............5%
30%..............10%
40%..............15%
50%..............20%
60%..............25%
70%..............30%
80%..............35%
90%..............40%
100%.............50%

This table gives you a worst case scenario for market declines. In general if your investments are for the "long term" you should invest in equities as your time horizon would allow you to weather the volatility of the stock market. Being forced to cash out to access your money at the heart of a decline would be a very undesirable circumstance.

What you classify as long-term savings is ultimately up to you. Personally, if I think I am going to be using the money in 5 years or less I keep it in a short term savings vehicle (i.e. online savings account) - this includes savings for a home down payment, an emergency fund, and money for a car purchase. Anything longer than 5 years (generally retirement savings) I'll invest in the stock market.

If you are young your retirement savings should be close to 100% equities with an increasing bond % as you age. This is another large discussion we can broach if you are interested.

Hope this helps.

Re: How safe is the stock market?
 

have a good rummage around www.fundadvice.com

Re: How safe is the stock market?
 

All 4 of those ETFs are the same asset class: US Large stocks. Buying all 4 of those is unnecessary overlap. VTI is the best one for US Large stocks.

If you are going to use more than 1 fund, you should use other asset classes: US small, International, Emerging markets, and so on. Try this thread for my discussion of what kind of losses you can expect, and which asset classes to use.

-Tom

Re: How safe is the stock market?
 

I thought you'd get better answers than this with all the posters here that knock "beta" as a measure of risk as I was hoping they'd share their insights.

Re: How safe is the stock market?
 

VTI is the best of those four funds. It's well diversified and cheap. The others are redundant. I would also suggest to diversify into other asset classes, such as foreign stocks, to reduce your risk.

Re: How safe is the stock market?
 

Thanks for the very helpful replies guys.

Gull, could you possibly recommend any foreign asset classes I should buy? I wouldn't even know where to look or how to decide between them.

Re: How safe is the stock market?
 

[ QUOTE ]
Is there any realistic risk of a market crash that I should be concerned with?

[/ QUOTE ]

Of course there is.

[ QUOTE ]
Is there any reason I'd want to leave a portion of my money in government insured savings accounts earning less interest?

[/ QUOTE ]

Yes, if you want to spend any of it in the next ten years. Or, if there's a crash, you can buy into the market more at a lower price.

Re: How safe is the stock market?
 

anyone have any tips on accessing risk for a particular stock, sheerly based on it's numbers?

Like if i were to look at the financial + charts in the span of 1 minute on yahoo or google finance, what would be good indicators for a noob to look at?

Re: How safe is the stock market?
 

[ QUOTE ]
anyone have any tips on accessing risk for a particular stock, sheerly based on it's numbers?

Like if i were to look at the financial + charts in the span of 1 minute on yahoo or google finance, what would be good indicators for a noob to look at?

[/ QUOTE ]

What you want to know is the volatility of a stock.

Generally, stocks with lower market caps are more prone to big swings because it takes less money to move them.

However, to actually quantify that volality is IMO impossible because investor psychology plays such a big factor in price movement.

Re: How safe is the stock market?
 

[ QUOTE ]
anyone have any tips on accessing risk for a particular stock, sheerly based on it's numbers?

Like if i were to look at the financial + charts in the span of 1 minute on yahoo or google finance, what would be good indicators for a noob to look at?

[/ QUOTE ]

Average True Range (ATR) is a useful measure of current volatility of a market. Plotting this as a 10 or 20-day EMA can help greatly in deciding how much of your portfilio to invest/risk in a particular market at a particular time

Re: How safe is the stock market?
 

[ QUOTE ]
[ QUOTE ]
anyone have any tips on accessing risk for a particular stock, sheerly based on it's numbers?

Like if i were to look at the financial + charts in the span of 1 minute on yahoo or google finance, what would be good indicators for a noob to look at?

[/ QUOTE ]

What you want to know is the volatility of a stock.

Generally, stocks with lower float are more prone to big swings because it takes less money to move them.

However, to actually quantify that volality is IMO impossible because investor psychology plays such a big factor in price movement.

[/ QUOTE ]

FYP

Re: How safe is the stock market?
 

I'm thinking perhaps the best thing for me is just to use one of the ETF portfolio's suggested on that site kimchi linked to. How does this look to you guys?

10% S&P Depository Receipts (SPDR) S&P 500 (SPY) LCB
10% Vanguard Value VIPERs (VTV) LCV
10% I-Shares Russell Microcap Index (IWC) SCB
10% Vanguard Small Cap Value VIPERs (VBR) SCV
10% Vanguard REITs Index ETF (VNQ) REIT
10% I-Shares MCSI EAFE (EFA) Int'l LCB
10% I-Shares MSCI EAFE Value Index (EFV) Int'l LCV
20% WisdomTree Int'l Small Cap Div Fund (DLS) Int'l SCV
10% Vanguard Emerging Markets VIPERs (VWO) EM


Is there any overlap or do any of you feel there are unnecessary choices in there? Are any additions or adjustments I should make? It was last updated in Januray so I really want someone's approval before I dive in. I'm starting with 10k by the way, but might add more later.

Re: How safe is the stock market?
 

[ QUOTE ]
[ QUOTE ]
anyone have any tips on accessing risk for a particular stock, sheerly based on it's numbers?

Like if i were to look at the financial + charts in the span of 1 minute on yahoo or google finance, what would be good indicators for a noob to look at?

[/ QUOTE ]

What you want to know is the volatility of a stock.

Generally, stocks with lower market caps are more prone to big swings because it takes less money to move them.

However, to actually quantify that volality is IMO impossible because investor psychology plays such a big factor in price movement.

[/ QUOTE ]

price change models by mandelbrot have the closest link to reality.

that is because it makes more sense that volatility scales vs. being linked by a normal distribution (as st.dev assumes). the relative probability of a 10% move vs. the probability of a 5% move should be similar to the relative probability of a .1% move vs. the probability of a .05% move.

this has held true in the empirical tests of his theory. the normal distribution has been widely defunct. it predicts something like 30 moves of >3% in a day over a century where we've had thousands of such moves in less than a century.

the problem is finding the estimates of the exponent and time factor in the power law distribution mandelbrot asserts. small changes in these estimates lead to huge chnages in results.

it isn't impossible to assess risk just because you think it is impossible to assess volatility though. that is what ranges around your inputs and monte carlo simulations are for.

Barron

Re: How safe is the stock market?
 

Re: Allocating about 10% each to various funds. I think that looks fine as far as stock allocation, although I think you could simplify it to something like 60% VTI, 30% EFA, 10% EEM or VWO. That really gets very close to what you're doing while being much easier to keep track of, especially if you want to do periodic rebalancing.

Question for everyone: whatever happened to allocating a portion of assets to bonds? I was reading Intelligent Investor recently where it is suggested that you should never have less than a 25% allocation to either stocks or bonds. I am comfortable with having less than 25% in bonds myself, but I still like 10% to 15% as a lower bound on bond allocation. (I guess that this could be it's own thread but I find it interesting that it never seems to get suggested in these asset allocation discussions like this one.)

Re: How safe is the stock market?
 

Maybe because bonds are near an all-time high? They dropped back a little after the Bernanke Bomb, but they are still very high on a historical basis.

Re: How safe is the stock market?
 

[ QUOTE ]
Maybe because bonds are near an all-time high? They dropped back a little after the Bernanke Bomb, but they are still very high on a historical basis.

[/ QUOTE ]

True, although they're lower now than at many times in the last few years. But I don't really think that has much to do with it. I just see a fairly pervasive attitude among younger people in particular (but this includes a lot of 30-somethings) that stocks are likely enough to crush bonds in the long term, that they decide to just put it all in stocks and trust in the uber-long term.

I am just curious if there is any theoretical or academic support for going all-stock if you are young enough and not very risk-averse.

Re: How safe is the stock market?
 

http://www.fundadvice.com/images/sto..._tuning_lg.jpg

According to this, over the last 35ish years having 25% in bonds would given about 12.75% annualized while 0% bonds would have yielded 14.4%. 1.65%/year is certainly nothing to sneeze at. While the past is certainly not proof for what is going to happen in the future, I think it at least shows a trend.

Re: How safe is the stock market?
 

[ QUOTE ]
According to this, over the last 35ish years having 25% in bonds would given about 12.75% annualized while 0% bonds would have yielded 14.4%. 1.65%/year is certainly nothing to sneeze at.

[/ QUOTE ]

Right, but look at the worst 60 months for 70% equities vs 100% equities. It's basically +7% vs -7%. That is also nothing to sneeze at!

So I guess my question is why/when did a lot of people stop caring about diversification relative to absolute gains? I wonder if it's just a case of time horizon. For example, over 10 years maybe it's very important to be diversified but over 30 years it is sufficiently dominated by absolute returns that you can (reasonably?) ignore diversification.

Re: How safe is the stock market?
 

[ QUOTE ]
[ QUOTE ]
According to this, over the last 35ish years having 25% in bonds would given about 12.75% annualized while 0% bonds would have yielded 14.4%. 1.65%/year is certainly nothing to sneeze at.

[/ QUOTE ]

Right, but look at the worst 60 months for 70% equities vs 100% equities. It's basically +7% vs -7%. That is also nothing to sneeze at!

So I guess my question is why/when did a lot of people stop caring about diversification relative to absolute gains? I wonder if it's just a case of time horizon. For example, over 10 years maybe it's very important to be diversified but over 30 years it is sufficiently dominated by absolute returns that you can (reasonably?) ignore diversification.

[/ QUOTE ]

Thing is, there's also the 'ulcer index'. I highly volatile portfolio is more likely to push the holder into buy/selling at exactly the worst time.

How many people (I'm guilty too) bought tech stocks in early 2000 and sold them in late 2002?

A well diversified, steady portfolio is more likely to help the average investor stick to his strategy - buy & hold

Re: How safe is the stock market?
 

I agree that for an average investor they should have a less volatile distribution. However this is primarily a poker forum and I think that the people on the boards have a higher tolerance for risk (or maybe it's just me) than the average person. We also have a better understanding of EV and desire to push that as much as we can.

Also the posters on this website tend to be younger than the average investor. Therefore we have a longer time period to invest over. However I realize that these things are not true for every poster on this forum and it should probably be stressed more when people ask for a typical spread of funds.

To be completely honest though I haven't done a lot of looking into the variance of allocation and have mainly looked at the EV and tried to reasonably maximize that. I am at the beginning of a long hold (30-40 years) and am assuming that is the best thing for me to do.

Re: How safe is the stock market?
 

The average young person doesn't have enough money to diversify into bonds. The commission charge on a few thousand dollars in bonds takes a big bite out of the yield.

On a personal note, I've never owned a bond in my life. When I was young, I thought their yield resembled a money market fund except they were much more illiquid. Now that I'm old, I have enough experience in the market to expect to be able to beat bond yields with stocks.

Re: How safe is the stock market?
 

[ QUOTE ]
The average young person doesn't have enough money to diversify into bonds. The commission charge on a few thousand dollars in bonds takes a big bite out of the yield.

[/ QUOTE ]

I'm really not trying to convince anyone to buy bonds, but this is not much of a reason to stay away from bonds. Plenty of bond ETFs via iShares alone that have very low expense ratios and very low transactions costs depending on your broker.

And honestly, it is someone with a small amount of savings that most needs to reduce variance. Not so much if you have backup emergency borrowing options (parents, friends, etc.), but if you really don't have much of a cushion, 100% stocks is a bad idea.

It is also occurring to me that the last couple of years have been atypical in that you can get the same yield from savings or money market funds as you can from bonds, but normally bonds are giving you an extra percent or two.

Re: How safe is the stock market?
 

[ QUOTE ]
The average young person doesn't have enough money to diversify into bonds. The commission charge on a few thousand dollars in bonds takes a big bite out of the yield.


[/ QUOTE ]

I'm not sure what you mean by this. The first balanced portfolio I tried to contruct for myself contained $200 worth of bonds & gilts held in a fund. There was no commission.

Re: How safe is the stock market?
 

There is no growth in the U.S now, and will not be for a long time. The fed is wrecking the dollar, so you should be expeditious in getting rid of those dollars as soon as possible. Having said that, there are U.S multinationals that are enjoying growth from around the world particularly asia. So I wouldn't recommend these broader indexes that you mentioned which are largely tied to the domestic economy. If you don't know how to pick individual stocks, look for some ETF's. Do a search for ETF's and find the particular industry you want to index. Your best bet will always be individual stocks though, if you are decent at picking them. If you never try, you will never learn. I would recommend 40% gold equities (auy is my favorite here and will see tremendous upside in the next 5 years, abx and gg are also solid), 40% emerging markets, particularly china and india(HDB and IBN are great banks in India which should do very well as that economy continues to expand. Bidu is incredible and is only just beginning.), and 20% large U.S multinationals like PG or KO. You probably won't do what I said, but it is good advice, and I have done very well in the market for years. Whatever you do, don't buy anything all at once! Number one rule and so important. Spread out your buys over a few months so that you aren't buying in at the highs. You can pm me if you have any questions.

Re: How safe is the stock market?
 

I own a little AUY. I don't think I like ABX. Here's a 5 part article that explains some of the nuances of buying gold companies while explaining some shady activities by Barricks execs.

http://oikonomika-blog.blogspot.com/...r-on-true.html


John

Re: How safe is the stock market?
 

So many suggestions and no knowledge to decide between them with. Sucks to be me.

Re: How safe is the stock market?
 

[ QUOTE ]
[ QUOTE ]
The average young person doesn't have enough money to diversify into bonds. The commission charge on a few thousand dollars in bonds takes a big bite out of the yield.

[/ QUOTE ]

I'm really not trying to convince anyone to buy bonds, but this is not much of a reason to stay away from bonds. Plenty of bond ETFs via iShares alone that have very low expense ratios and very low transactions costs depending on your broker.

[/ QUOTE ]

ETF's are like a bond fund, the interest is reflected in the total tield? Not that I would want a bond anyway, but there's no way I would want any part of a fund. At least with a bond, I can't lose any of the principal unless they default.

[ QUOTE ]
And honestly, it is someone with a small amount of savings that most needs to reduce variance. Not so much if you have backup emergency borrowing options (parents, friends, etc.), but if you really don't have much of a cushion, 100% stocks is a bad idea.

It is also occurring to me that the last couple of years have been atypical in that you can get the same yield from savings or money market funds as you can from bonds, but normally bonds are giving you an extra percent or two.

[/ QUOTE ]

If I'm going to have any fixed income, it better be safe as hell. So no corporates, government only. The difference, even many years ago, between govt bond yield and money market yield was not worth the loss of flexibility and commission costs.

I'm not saying nobody should have bonds either, but you were asking why there seems to be little interest in them. I gave you one reason - too much additional risk for too little additional value.

Re: How safe is the stock market?
 

[ QUOTE ]
ETF's are like a bond fund, the interest is reflected in the total tield?

[/ QUOTE ]

Let's take IEF, the iShares 7-10 yr Treasuries. A simplified version of what it does is to buy a 10 yr Treasury, hold it for a 3 yrs and sell. (Of course, in reality there is going to be a mix of maturities, holding times, etc.) Any interest and gains are then passed to the shareholders as dividends. Obv, you don't have much control over things compared to buying and selling bonds, but you also have minimal transactions costs, which is definitely not true if you actually were going to buy & sell bonds.


[ QUOTE ]
I'm not saying nobody should have bonds either, but you were asking why there seems to be little interest in them. I gave you one reason - too much additional risk for too little additional value.

[/ QUOTE ]

[img]/images/graemlins/confused.gif[/img] The purpose of adding bonds to an equity allocation is to sacrifice some expected returns for a reduction in volatility (both of these from the perspective of your entire portfolio).

Re: How safe is the stock market?
 

[ QUOTE ]
At least with a bond, I can't lose any of the principal unless they default.

[/ QUOTE ]

Right, all you have to do is hold a 30 yr bond for 30 yrs and you are guaranteed not to lose principal.

Re: How safe is the stock market?
 

[ QUOTE ]
[ QUOTE ]
ETF's are like a bond fund, the interest is reflected in the total tield?

[/ QUOTE ]

Let's take IEF, the iShares 7-10 yr Treasuries. A simplified version of what it does is to buy a 10 yr Treasury, hold it for a 3 yrs and sell. (Of course, in reality there is going to be a mix of maturities, holding times, etc.) Any interest and gains are then passed to the shareholders as dividends. Obv, you don't have much control over things compared to buying and selling bonds, but you also have minimal transactions costs, which is definitely not true if you actually were going to buy & sell bonds.


[ QUOTE ]
I'm not saying nobody should have bonds either, but you were asking why there seems to be little interest in them. I gave you one reason - too much additional risk for too little additional value.

[/ QUOTE ]

[img]/images/graemlins/confused.gif[/img] The purpose of adding bonds to an equity allocation is to sacrifice some expected returns for a reduction in volatility (both of these from the perspective of your entire portfolio).

[/ QUOTE ]

Broken record time again...but this time i have actual suggestions for funds.

you start here lets say:

Portfolio Allocation without Leveraged Funds

Fund Sector - Portfolio %
S&P 500 Index Fund - 20%
NASDAQ 100 Fund - 20%
Intl Equity Fund - 20%
U.S. Treasury Fund - 10%
U.S. Corporate Bond Fund - 10%
U.S. High Yield Bond Fund - 10%
U.S. TIPs Fund - 10%
TOTAL - 100%

and you then use leverage to free up capital:

Portfolio Allocation with Leveraged Funds

Fund Sector/Name - Leverage “X” times- Allocation %
Dynamic S&P 500 - 2X - 10%
Dynamic OTC - 2X - 10%
Ultra Intl - 2X - 10%
Govt. L-Bond Adv - 1.2X - 8%
U.S. Corporate Bond - 10%
U.S. High Yield Bond - 10%
U.S. TIPs Fund - 10%
TOTAL - 68%

and finally you allocate the extra capital to new more efficient places:

Fund Sector/Name - Leverage “X” times- Allocation %
Dynamic S&P 500 - 2X - 10%
Dynamic OTC - 2X - 10%
Ultra Intl - 2X - 10%
Govt. L-Bond Adv - 1.2X - 8%
Collateralized Commodity Fund - 12%
Emerging Market Debt Fund - 20%
U.S. TIPs Fund - 30%
TOTAL - 100%

I have calculated the portfolio expected SR using the top and bottom allocation and reasonable assumptions (that "reasonable" people may disagree with , but changing them here and there doesn't change the overall results much).

if there is a way to host an excel sheet on the internet i would be glad to post it so you can see my changes and what correlation/vol/return assumptions i made. i also didn't take FX risk into account.

the results were as follows:

NON LEVERAGED FUND:
Portfolio Expected XR: 3.40%
Portfolio Expected Risk 10.07%
Portfolio Expected SR: 0.34

LEVERAGED FUND:
Portfolio Expected XR: 5.00%
Portfolio Expected Risk 10.69%
Portfolio Expected SR: 0.47

i think those results speak for themselves.

by using leverage to increase the risk share of more lowly/negatively correlated asset classes while maintaining the same effective capital exposure to your equity funds, you greatly increase your portfolio efficiency.

feel free to ask questions or if you know how to host a spreadsheet on the internet, lemme know.

i'll also post the Capital and risk pies if you guys want...they are a great visual aid.

Barron

Re: How safe is the stock market?
 

Barron, it's pretty easy to upload an excel spreadsheet into Google docs and then publish that, but I'm sure you knew that. Also, there is no easy way to show formulas that I'm aware of.

Quick question, what do you assume about margin rates here? I've never really considered going on margin (in spite of the strong theoretical case) and part of that is b/c margin rates can be kind of high. For example, looking at eTrade margin rates they start at 9.74% (<50k) and fall to 6.74% (>1m). As I'm not a millionaire, these margin rates don't look super enticing to me!

Any specific thoughts on leveraging here? I know margin accounts are not the only way to lever, and if your personal margin rate is 9.74% it almost certainly can't be the best way. [img]/images/graemlins/grin.gif[/img]

Re: How safe is the stock market?
 

The damn stock market is as safe as whatever the economy it's representing. So if you think the stock market is unsafe, that means you think the economy is unsafe. And if that is the case, who the hell cares how much money you have in your bank, your mattress, or your backyard? The economy collapsed. You need to have barrels of moneys to buy a carton of milk.

Re: How safe is the stock market?
 

[ QUOTE ]
[ QUOTE ]
At least with a bond, I can't lose any of the principal unless they default.

[/ QUOTE ]

Right, all you have to do is hold a 30 yr bond for 30 yrs and you are guaranteed not to lose principal.

[/ QUOTE ]

Or a 2 year or a 5 year or whatever. The whole point of fixed income, since the return absolutely sucks, is return OF principal, not return ON principal. Absolutely, unequivocably, no risk, short of armageddon. If I'm taking on risk, I want a lot better return.

I'm not saying that is necessarily correct, but I'll bet a lot of people have similar attitudes about fixed income.

Re: How safe is the stock market?
 

[ QUOTE ]
Barron, it's pretty easy to upload an excel spreadsheet into Google docs and then publish that, but I'm sure you knew that. Also, there is no easy way to show formulas that I'm aware of.

Quick question, what do you assume about margin rates here? I've never really considered going on margin (in spite of the strong theoretical case) and part of that is b/c margin rates can be kind of high. For example, looking at eTrade margin rates they start at 9.74% (<50k) and fall to 6.74% (>1m). As I'm not a millionaire, these margin rates don't look super enticing to me!

Any specific thoughts on leveraging here? I know margin accounts are not the only way to lever, and if your personal margin rate is 9.74% it almost certainly can't be the best way. [img]/images/graemlins/grin.gif[/img]

[/ QUOTE ]

no assumption on margin b/c no actual margin is used:

Dynamic S&P 500 fund

instead you pay minimal (relatively speaking) expense ratios.

also, i didn't know about the google docs, but can you see my formulas that way? if not then that isn't a huge deal b/c the important assumptions are the correlation/sharpe ratios etc.

i'll try to do that now (never used google docs)

Barron

EDIT:here is the link to my published spreadsheet. i still think it would be useful to see my pretty spreadsheet w/ the formulas so if somebody could tell me how to host it or whatever that'd be nice:

Portfolio Analysis Normal vs. Leveraged

further, this is UUUUUGGGGGLLLLLy relative to mine on my desktop. the places you should concentrate your energy are the "Risk", "Expected Sharpe Ratio" rows as well as the correlation cells. i took a most of the corerlations (that i manually keyed in) from historical analyses and from logical application of expected future correlations.

hope this helps.

Re: How safe is the stock market?
 

[ QUOTE ]
The whole point of fixed income, since the return absolutely sucks, is return OF principal, not return ON principal.

[/ QUOTE ]

No, the main point of having bonds in your portfolio is the low or negative correlation w/ stocks (aka diversification).

Re: How safe is the stock market?
 

Re Dynamic S&P Fund: 4.75 front load & 1.68 expense ratio? Is there not a better way? (Just asking, maybe there isn't and I know nothing about his stuff.)

Also, with Google Docs you can share the whole spreadsheet (including the formulas) but only to email addresses you specify. As far as I can tell when you publish or share publicly, it will only give the values.

Re: How safe is the stock market?
 

[ QUOTE ]
[ QUOTE ]
The whole point of fixed income, since the return absolutely sucks, is return OF principal, not return ON principal.

[/ QUOTE ]

No, the main point of having bonds in your portfolio is the low or negative correlation w/ stocks (aka diversification).

[/ QUOTE ]
No, the main point of having bonds in your portfolio is so you have less stocks.

Re: How safe is the stock market?
 

[ QUOTE ]
[ QUOTE ]
The whole point of fixed income, since the return absolutely sucks, is return OF principal, not return ON principal.

[/ QUOTE ]

No, the main point of having bonds in your portfolio is the low or negative correlation w/ stocks (aka diversification).

[/ QUOTE ]

only TIPS have negative correlation to stocks.

most govt bonds have about 40% positive correlation.

Barron

Re: How safe is the stock market?
 

[ QUOTE ]
Re Dynamic S&P Fund: 4.75 front load & 1.68 expense ratio? Is there not a better way? (Just asking, maybe there isn't and I know nothing about his stuff.)

Also, with Google Docs you can share the whole spreadsheet (including the formulas) but only to email addresses you specify. As far as I can tell when you publish or share publicly, it will only give the values.

[/ QUOTE ]

not as far as i know there isn't a better way.

load is paid 1 time. expense ratio annually. if you build a portfolio like this i'd expect to pay something small up front. if you add more to it over time, do you pay the load again? (not surea bout this) if not then it is a great deal. even if you do i'm sure it isn't a huge deal.

also, go through my correlation spreadsheet and let me know if you have a question/issue/correction on any of the #s. they are, like i said, mostly based on various historical studies & my own work in addition to my own logic.

this portfolio should be far better than any single portfolio posted on this forum by a very good margin.

it is easy to initiate and manage so anybody can do it (i.e. you don't need to leverage TIPS w/ repos etc. or pay taxes on them like that so that is great)

Barron