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Other Asset Classes and their allocations

Started by Peter, April 08, 2013, 11:00:00 PM

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dontvote

Since mutual funds lag their index returns by an amount approximately equal to their fees, I'm not sure why dollar cost averaging an etf is a bad idea?


TravelingPennies

Has anybody tried Wealthfront?  Seems like a decent alternative to using a traditional advisor. They do asset allocation, rebalancing and tax loss harvesting automatically for a 0.25% fee.  I can't use them, but I would recommend to friends and family...


TravelingPennies

Back to OP's question on "Other Asset Classes", since many in this Forum are doing active management, has anyone successfully played with equity options?


TravelingPennies

We'll see if we have another "sell in May" in equities.  It all depends on global GDP outlook and the daily datapoints that drives this sentiment. If things get choppy on macro, then perhaps people pour money back into treasuries.  Bill Gross is saying that the falling Yen is driving Japanese investors into all kinds of US/European denominated assets, including US treasuries.  I'm not sure this dynamic can offset global money flows into riskier assets, but the size of household savings and pension funds sitting in cash and Japanese debt suggests they have a lot of firepower.

I think the decision on using something like Wealthfront is interesting.  I think the most powerful benefit of this type of service or even the full service financial advisors that charge 1%+ is protecting oneself from emotionally driven, poor decision making.  For example it's tough to rebalance asset classes because it's against human nature to buy beaten up things and sell high flying things. Also, doing the tax loss harvesting has a lot of value but its a hassle to do. 

One solution may be to put some % of money with them to give it a "test drive." For the record, I am not affiliated with them nor am I advocating them here... 

NEW LOANS:   | 870.eth 2.500 Ξ | 804.eth 2.500 Ξ | remoraid.eth 0.299 Ξ | ALL