Why portfolio construction is messy, personal, and never perfect. We compare the pros and cons of several portfolio strategies, including target-date funds, risk parity, and role-based portfolios. We conclude with three AI-related fallacies that will help us better navigate the current moment. Show Notes Why Everything Suddenly Is ‘Perfect’ by Paula Marantz Cohen—The Wall Street Journal Your Perfect Portfolio by Cullen Roche—Pan MacMillan My Core Investment Values by Peter … [Read more...]
552: AI Is Changing Me – and the Case for Good Enough
When is good enough actually good enough? AI is reshaping how I work and live. And a member with a portfolio that's beaten an all-in-one Vanguard LifeStrategy fund for ten years asks whether the complexity is worth it — or whether it's time to simplify. Show Notes The Upswing: How We Came Together a Century Ago and How We Can Do It Again by Robert Putnam—Simon &Schuster An update on our model deprecation commitments for Claude Opus 3—Anthropic Claude's … [Read more...]
548 Plus: Updated Expected Return Assumptions, Impact of Mortgage Backed Bond Purchases, and Comparing Two Non-U.S. Equity ETFs
In Plus episode 548, we review the updated expected returns and probable ranges for a variety of asset classes over the next decade. We revisit the Plus member tools that utilize those assumptions. We consider the impact of President Trump's charge that Fannie Mae and Freddie Mac purchase up to $200 billion in mortgage-backed securities in order to try to lower mortgage rates. Finally, we compare the Fidelity Enhanced International ETF (FENI) and the Vanguard FTSE Developed Markets Index … [Read more...]
508 Plus: Annual Asset Class Expected Returns and Ranges Update
This week on Plus episode 508, we review the revised asset class expected returns. We discuss the process, changes to the assumptions, and tools available that incorporate the revised assumptions. Become a Member If you would like to listen to this episode of Money For the Rest of Us Plus, you can do so by becoming a Money For the Rest of Us Plus member. Learn More About Membership Options » 508 Plus Show Notes Asset Allocation Assumptions Asset Allocation Spreadsheets … [Read more...]
502 Plus: TFLO Flash Crash, Active Asset Allocation, Coinbase, and Investing in Bitcoin
In Plus episode 502, we discuss the one-day flash crash for the iShares Treasury Floating Rate Bond ETF in 2014. We discuss the reasons for the initial allocation to TFLO in the adaptive model portfolios back in 2018. We discuss the importance of making incremental portfolio changes compared to large moves. Finally, we discuss the improving financial situation at cryptocurrency custodian Coinbase and the ways to invest in Bitcoin. Become a Member If you would like to listen to this … [Read more...]
491: The Five Layers of Investing
We explore the five layers of investing, including which assets fit into each layer, and give examples of advertisements targeting each layer. The five layers are: Show Notes Asset Camp The Role of Emotions in Financial Decisions by David Tuckett—ResearchGate Morningstar Active Passive Barometer Episode Sponsors Monarch Money – Get an extended 30-day free trial LinkedIn Jobs – Use this link to post your job for free on LinkedIn Jobs Related Episodes 486: … [Read more...]
461 Plus: Updated Expected Returns, Index Rebalancing, and Portfolio Questions
In Plus episode 461, we review the changes to the Money for the Rest of Us Plus expected return assumptions and discuss the resources available on the site for modeling portfolios using the return assumptions. We answer a question on how stock index providers, such as S&P, handle share count changes for determining the weighting of a holding within the index. Finally, David answers some questions on his portfolio, including a review of the asset category ranges he has had for the past … [Read more...]
451: How Much Should You Invest in Stocks? The Art of Position Sizing in a Volatile Market
Our allocation to risky assets should vary based on the expected return, volatility, risk aversion, and how much we can earn risk-free. That means we should be taking less risk right now. Listen to learn why. Topics covered include: Show Notes How to avoid a common investment mistake - Buttonwood - The Economist The Missing Billionaires: A Guide to Better Financial Decisions by Victor Haghani and James White Money For the Rest of Us List of Most Influential … [Read more...]
419: How to Make Portfolio and Asset Allocation Changes
We consider four case studies in which individuals struggle to decide what to do with their investment portfolios. Topics covered include: Show Notes Case studies were pulled from the following Plus episodes: 287 Plus: Coronavirus Update, Mid Month Investment Conditions and Overcoming the Fear of Investing 306 Plus: Member Profile, Bond Investing, and Emerging Technology 310 Plus: Mid Month Update and a Member Wants to Reallocate from Growth Stocks 331 Plus: Member … [Read more...]
417 Plus: Which Assets Now, How Much in Real Estate, Disinflation, Foreign Taxes, and CEFs
In Plus Episode 417, we consider whether there is an optimal price to renter the S&P 500 Index or other asset classes. We discuss what disinflation means. We consider what is a reasonable allocation to public and private real estate. We consider the impact of foreign withholding taxes on dividends. Finally, we look at the current closed-end fund landscape. Become a Member If you would like to listen to this episode of Money For the Rest of Us Plus, you can do so by becoming a … [Read more...]
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