Blog Archives

Core Four portfolios- 2018 update

Core four portfolios are simple indexed portfolios that allocate assets across four asset class mutual or exchange-traded funds. The 2018 performance of the core four portfolio based on Vanguard’s life strategy and target date portfolio allocations, and of Rick Ferri’s

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Posted in Market statistics, Portfolios

2018 US stock market index returns

The table below provides US stock market returns for 2018 as measured by major index providers.

Posted in indexing, Market statistics

Three fund portfolios for taxable accounts – 2018 update

The Taylor Larimore three-fund portfolio is a portfolio design consisting of three “total” market index funds covering the US stock market, the international stock market, and the US taxable investment grade bond market. However, investors with large taxable accounts and

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Three fund portfolio using inflation indexed bonds – 2018 update

The Taylor Larimore three-fund portfolio is a portfolio design consisting of three “total” market index funds covering the US stock market, the international stock market, and the US taxable investment grade bond market.  Newspaper columnist Scott Burns has suggested a

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Three fund portfolio 2018 update

  The Taylor Larimore three-fund portfolio, is a portfolio design consisting of three “total” market index funds, covering the US stock market, the international stock market, and the US taxable investment grade bond market. Investors were able to implement this

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Posted in Market statistics, Portfolios

Update: Vanguard brokerage commission expense (1994 – 2017)

Mutual funds that buy and sell stock incur costs on these transactions. These transaction costs are not included in a fund’s expense ratio. Transaction costs include brokerage commission expense, buy and sell spread costs, and market impact costs, Among these

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Posted in Market statistics, Mutual funds

Revisiting Risk and Reward (Part 3)

A previous blog article explored income-centric risk and reward definitions, which could be viewed as more suitable to retirement than the usual academic definitions. Corresponding quantitative analysis of some simple US portfolios was provided. A follow-up article explored the perspective of retirees located outside the US.

This article extends this investigation by exploring in more technical depth the tie-in between Safe Withdrawal Rates (SWR) and variable withdrawal methods, through the use of a clever metric named Withdrawal Efficiency Rate (WER). 

Posted in Asset allocation, Market history, Market statistics, Portfolios

Revisiting Risk and Reward (Part 2)

A previous blog article explored income-centric risk and reward definitions, more suitable to retirement than the usual academic definitions. Corresponding quantitative analysis of some simple US portfolios was provided.

This article extends this investigation by taking the perspective of investors located in various developed countries (a form of ‘out of sample’ testing).

Posted in Asset allocation, international stocks, Market history, Market statistics, Portfolios, Retirement

Revisiting Risk and Reward

Financial literature from academics has been strongly influenced by the ground-breaking work of Harry Markowitz and William Sharpe, and the concept of risk & reward for a multi-asset portfolio. Although brilliantly innovative, this work is often misused, equating risk with (portfolio) volatility and reward with (portfolio) returns, and applying such principles without acknowledging the fundamental differences between investors and speculators, or accumulators and retirees.

This article will explore risk and reward from a perspective more suitable to retirement, and perform corresponding quantitative analysis of some simple portfolios.

Posted in Asset allocation, Market history, Market statistics, Portfolios, Retirement, Value premium

Global investment portfolios 2018 update

The Credit Suisse Global Investment Yearbook 2018 summary is now available for download from Publications – Credit Suisse. The yearbooks are an extension of the research of Elroy Dimson, Paul Marsh, and Mike Staunton, first published in the 2002 edition

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