[Update on July 19, 2008]: The name of the forum changed to Bogleheads Investment Forum. diehards.org domain name also changed to bogleheads.org. I have been a member of the Vanguard Diehards forum at Morningstar for a long time. People there help each other with investment related discussions. The forum however has a weakest link — […]
Was It a Bubble, Or Was It Just Early?
One of the often used excuse for having ventured into something that didn’t materialize is “I wasn’t wrong. I was just early.” There is some truth to that statement although timing is every bit as important as the action itself. I’m seeing a number of things derided after the late 1990s stock bubble coming back […]
Why Not 100% Stocks?
There is a lively discussion on the My Financial Journey blog about whether a young person should invest 100% in stocks if he/she doesn’t care about short term volatility. I’m writing my comments here because it’s kind of long. My Financial Journey said: For some reason I can’t get it through my thick skull why […]
Prosper.com Or Junk Bond Fund?
I saw on several blogs people are lending on Prosper.com as way of earning extra cash over money market, CDs, or savings accounts. I must admit I’m not very familiar with Prosper.com but I think I understand the concept. It’s often referred to as eBay for lending and borrowing. Borrowers list their loan requests. Lenders […]
More Risk, More Reward?
Perhaps inspired by home makeover reality shows, Trading Places, Extreme Home Makeover, etc., newspapers and magazines often run portfolio makeover articles. They typically feature a real family, tell us about their finances, their goals and their struggles. Then the newspaper or magazine brings in a financial planner who offers advice for them. I think people […]
Redeemed October 2005 I Bonds
I redeemed my October 2005 I Bond last week but I didn’t get to write about it until now. This I Bond was purchased at the end of October 2005 in a special situation when the inflation adjustments for the following 12 months were known and were relatively high. I bought it only because the […]
Estimate Your Personal Rate of Return for Multiple Years
Since I wrote about a simple formula for estimating your personal rate of return, someone asked whether the same formula works for multiple years as well. The answer is yes and no. It works well, provided that the net investments during the period are roughly even; and the beginning balance is large relative to the […]
Estimate Your Overall Personal Rate of Return
Happy New Year! Now that 2006 is over, it’s time to see how our investments did last year. You can look up the performance numbers online or in newspapers, but if you bought or sold during the year, those numbers won’t match your own rate of return because the numbers online or in the paper assumes […]
The Best Brokerage Firm for Bonds
The best broker for bonds depends on whether you buy bond funds, bond ETFs, or individual bonds.
Did Sunk Cost Fallacy Kill James Kim?
In the book Why Smart People Make Big Money Mistakes And How To Correct Them the authors Gary Belsky and Thomas Gilovich had an example for illustrating the Sunk Cost Fallacy which goes like this: There is a basketball game tonight. It’s snowing and the roads are dangerous. You already bought ticket to the game […]
Is Inflation Dead?
Bob Brinker, host of a nationally syndicated radio program Money Talk, opened his show a few weeks ago by observing that the year over year inflation rate as of October 2006 is only 1.31% as measured by the Consumer Price Index. He went on to say that the Federal Reserve was mistaken about worrying about inflation and […]
Employee Stock Purchase Plan (ESPP) Is A Fantastic Deal
If you work for a publicly-traded company that offers an Employee Stock Purchase Plan (ESPP), you’ve got yourself a fantastic deal. How ESPP Works An ESPP typically works this way: 1. You contribute to the ESPP from 1% to 10% of your salary. The contribution is taken out from your paycheck. This is calculated on […]