Search found 525 matches

by peteyperson
Wed May 11, 2005 9:00 am
Forum: FIRE Board
Topic: Bonds in a portfolio and TIPS ladders
Replies: 21
Views: 17518

Zendrix, Harvard University Endowment Fund allocation a category for 'HY Securities' which is split evenly between US junk bonds and EM debt. They separate it out because it functions entirely differently from their other bonds. Petey Cathyet: That Vanguard Diehard post is interesting. I hope they k...
by peteyperson
Tue May 10, 2005 8:35 am
Forum: FIRE Board
Topic: A TIPS Ladder Example
Replies: 103
Views: 65629

Hi ben, I think what is missed in some of the simple minded scenarios is the dependence on the official cpi number I don't agree with petey that there is an intentional understatement if you run the numbers for 1.5% real tips and 3% inflation for 40 years then change the assumption so that inflatio...
by peteyperson
Sat May 07, 2005 6:37 am
Forum: FIRE Board
Topic: Bonds in a portfolio and TIPS ladders
Replies: 21
Views: 17518

Petey, I agree that em debt returns have been high and volatile and this shouldn't be a retirees only type of fixed income allocation but it might provide good diversification for those of us who are exposed to a country with aging population, declining industrial base, insolvency, and extensive gl...
by peteyperson
Sat May 07, 2005 6:24 am
Forum: FIRE Board
Topic: A TIPS Ladder Example
Replies: 103
Views: 65629

... I agree that the S&P 500 is overvalued. Last time I looked the TTM P/E was around 19-20. Historical is 14-16. Historical dividend is 4.4%. Last time I looked it was 1.8% today (although payout ratio may explain some of a difference there) . So for those who believe in reversion and has studied ...
by peteyperson
Thu May 05, 2005 11:19 pm
Forum: FIRE Board
Topic: Bonds in a portfolio and TIPS ladders
Replies: 21
Views: 17518

Hi Ataloss! so why would you hold tips and exclude em debt, junk bonds etc as in jwr's example In fairness to JWR, his example was a "TIPS Ladder Example". It wouldn't make much sense to have em debt or junk bonds, since they are not TIPS. :D(maybe they could be included in the other 60-80%???) Bea...
by peteyperson
Thu May 05, 2005 11:15 pm
Forum: FIRE Board
Topic: A TIPS Ladder Example
Replies: 103
Views: 65629

Peteyperson There are usually opportunities if one wishes to look deeper. Broad sweepin' statements will miss such opportunities which could be quite costly in the long-run. P.S. Not knocking you, John, just thought it was worth pointing out. Thank you. You have a good point. In the context that I ...
by peteyperson
Thu May 05, 2005 8:41 am
Forum: FIRE Board
Topic: Bonds in a portfolio and TIPS ladders
Replies: 21
Views: 17518

so why would you hold tips and exclude em debt, junk bonds etc as in jwr's example Hi ataloss, If one holds bonds not for high returns but for insurance that one won't be forced to sell stocks for a decade when markets hit a prolonged bear market, then EM debt and junk would hold little appeal. You...
by peteyperson
Thu May 05, 2005 8:32 am
Forum: FIRE Board
Topic: A TIPS Ladder Example
Replies: 103
Views: 65629

Sigh! One more time - If you go to the Libra Investment Management website, click on Investment policy and look at the mythical widow example portfolio - you will find a very good MPT 7type portfolio. Couldn't have done a better job on my best day. Now you take my mythical sweetie - the steely eyed...
by peteyperson
Thu May 05, 2005 8:17 am
Forum: FIRE Board
Topic: A TIPS Ladder Example
Replies: 103
Views: 65629

The answer is far from an easy no because it is not my decision. Our numbers strongly support a zero percent stock allocation at recent stock market valuations. (We are close to the territory where it can make sense to start adding a minimal allocation of stocks.) John Russell It is worth noting he...
by peteyperson
Thu May 05, 2005 5:47 am
Forum: FIRE Board
Topic: Bonds in a portfolio and TIPS ladders
Replies: 21
Views: 17518

Bonds in a portfolio and TIPS ladders

My internet access is short and occasional, so I thought I would put a few words together in a new thread. If one were to take a 70/30 portfolio of stocks and bonds. Then imagine a 1970s scenario... Stocks multiples fell and returns were unpleasant. In such a scenario, one would wish to keep hold of...
by peteyperson
Thu May 05, 2005 4:55 am
Forum: FIRE Board
Topic: A TIPS Ladder Example
Replies: 103
Views: 65629

Greetings unclemick :) I seem to have missed something - ? isn't the whole point of a ladder to sell bonds(of whatever kind) as they come due. Who cares about market vs NAV in the stretch? Either you have missed something, or I have. Lets not discount either possibility. :wink: But the idea of this...
by peteyperson
Sat Apr 30, 2005 3:21 am
Forum: FIRE Board
Topic: A TIPS Ladder Example
Replies: 103
Views: 65629

Hi John! Thanks for the 50 year numbers and so quick too! I feel a little guilty about hangin' out on the beach, while you were doing all the work. 8)I guess I'll have to buy you a beer some time. :D I also liked the 40%/60% scenario. It makes me wonder about a 20% TIPS ladder, 60% equities and 20%...
by peteyperson
Sat Mar 26, 2005 10:33 am
Forum: SWR Research Group
Topic: TIPS drawdown at staggered coupon rates
Replies: 28
Views: 24612

National Savings Inflation-Linked Savings Certificates. You could call them I-Certs but that would be a bit of a mouthful! It is a bit like how TIPS are actually Treasury Inflation-linked Securities in the US but the TIPS name caught on all the same! I think they are only open to people from the UK,...
by peteyperson
Sat Mar 26, 2005 10:14 am
Forum: SWR Research Group
Topic: TIPS drawdown at staggered coupon rates
Replies: 28
Views: 24612

Hi Petey, :D With only 20% in the TIPs how is anyone gonna live of 4% of that only? Lets say total nest egg is $1M. That is 200k in TIPs - creating 8k/year for 30 years . Petey; are we talking a $3M portfolio? laddered 1/10th coming due a year, providing sufficient (mostly) tax-free income/return o...
by peteyperson
Sat Mar 26, 2005 10:03 am
Forum: SWR Research Group
Topic: TIPS drawdown at staggered coupon rates
Replies: 28
Views: 24612

To peteyperson: Thank you for this outstanding series of posts. Your ideas are exceptionally well thought out. They are easily adapted to satisfy each individual's needs. You keep open the ability to take advantage of opportunities as they appear. A TIPS ladder of ten years is ideal for such purpos...
by peteyperson
Sat Mar 26, 2005 9:40 am
Forum: SWR Research Group
Topic: TIPS drawdown at staggered coupon rates
Replies: 28
Views: 24612

Hi NS, I-Bonds are different in the UK. Nothing is taxable. There is no tax deferred. I-Bonds are only 1.05% real returns on the surface and if that was all they provided then I would agree with you. Due to the ability to plan to spend them down over 40-years (not 30) and the lack of volatility in t...
by peteyperson
Fri Mar 25, 2005 8:23 pm
Forum: SWR Research Group
Topic: TIPS drawdown at staggered coupon rates
Replies: 28
Views: 24612

I actually did think of this but just did not add it in. I don't know that it is desirable to live beyond a certain age if the quality of life just isn't there. Interestingly, the human body seems to hear this and acts appropriately. Many men die within a few months of losing their wives, for instan...
by peteyperson
Fri Mar 25, 2005 6:59 am
Forum: SWR Research Group
Topic: TIPS drawdown at staggered coupon rates
Replies: 28
Views: 24612

Hi NS, Here you're talking both of yield-to-maturity and the price bought vs par value. Clearly one would purchase at a price where you were getting your money back - inflation-adjusted - down the line. With I-Bonds one does not buy them on the open market and so there is no issue with par value, yi...
by peteyperson
Fri Mar 25, 2005 6:24 am
Forum: SWR Research Group
Topic: TIPS drawdown at staggered coupon rates
Replies: 28
Views: 24612

I guess most agree that TIPs can be a good part in a well diversified portfolio. If one decides to run it as 2 portfolios (1 TIPs/1 others) and first spending down the TIPs portfolio while letting the other part stay untouched, I guess that does not not change the overall risk/return much. And I am...
by peteyperson
Fri Mar 25, 2005 6:19 am
Forum: SWR Research Group
Topic: TIPS drawdown at staggered coupon rates
Replies: 28
Views: 24612

ok petey, there have been proposals for 100% tips portfolios (and you are way too young for that :lol: ) Yeah. I don't think that is smart. You can always have institution risk, however secure the insitution appears. Printing endless money to pay the bond coupon and being insulated from the ensuing...