Here are my posts for this week:
Crashing a 2014 stock-picking contest
When would you offer more than the asking price?
Here are some short takes and some weekend reading:
Robb Engen at Boomer and Echo gives a thoughtful discussion of his 2014 portfolio return and his decision to switch to simple ETF-based index investing.
Preet Banerjee explains how your capital gains on investment real estate can be much less than simply the sale price minus the purchase price.
Canadian Couch Potato has made some extensive changes to his model portfolios. I like the changes. He’s sticking to the major asset classes instead of including REITs and other assets. Simplicity is important. It’s amazing how complicated things can get as you try to manage several types of accounts in a single portfolio. For the ETF-based portfolios, he’s focusing on Vanguard's ETFs. This makes sense to me because they're a great company.
Canadian Portfolio Manager analyzes 4 actively-managed funds that appear to offer market-beating returns, but after accounting for value tilts and small-cap tilts the shine comes off. I’m of two minds about these factor regressions. On one hand they show that outperformance is often just overweighting in value and small-cap stocks. On the other hand, what if a fund manager had the skill to know whether such stocks would outperform over a given period of time? Factor regression will deny the existence of such skill by definition. Taken to the extreme, if we add enough factors so that every stock is in its own category, then buy-and-hold outperformance is impossible by definition. All that said, I think 3-factor regressions are likely a useful way to examine outperformance.
Big Cajun Man pays homage to the humble Mason jar as a versatile source of frugality.
My Own Advisor is musing about transitioning out of the work force. Sounds like someone who doesn’t feel like going to work today. That probably applies to many of us.