I’m on my first time off from work since literally December, so posting will be a bit slow for the next couple of weeks. Don’t be like me. Take some time off occasionally.
How do I go about buying into a Vanguard Target Retirement fund in Singapore? Is it via IBKR as well?
You don’t want to. The Vanguard funds are great for US investors, but they’re not really appropriate for Singaporean investors.
Any thoughts from anyone for good SRS investment options and of the Lion Global infinity series
Endowus also provides some options for SRS investing through dimensional funds.
Nah, the Lion Global Infinity funds, and Endowus’ Dimensional wraps, are both horrifically expensive. The Infinity funds charge nearly 1% a year for the privilege of funneling your money into a Vanguard fund, which, man, that pays for a lot of Ferraris for the fund managers.
BBC or anyone familiar with very long term TIPs 15+ years.
Please explain if you can the differences in benefits between short (up to 5 years duration, intermediate ie. 8 years duration and Long term TIPs (greater than 15 years duration) for a portfolio especially pertaining to inflation, and if you are able to, regards to expected and unexpected inflation, and the reliability of them.
Is this a homework question? Like, I’m not trying to be rude, but what are you trying to get out of this question - are you trying to decide which point on the curve to buy?
and I start to see nominal bonds being superceded by intermediate or long term TIPs, why ?.....do TIPs also protect in deflation which I've seen it does at the first leg during the crisis.
The reason US TIPS have done well over the last three months is because they did ABYSMALLY over the March crash, and now they’re just retracing to normal. TIPS have basically followed the SPX, weirdly enough.
Very roughly, break-even inflation implied by US TIPS is about 1.6% right across the curve right now. That means, if you’re looking at buying a 10-year bond, and you’re choosing between a nominal bond or a linker: if US inflation (as measured by the CPI) runs hotter than 1.6% p.a. over the next 10 years, then the linker will pay out more money than the nominal bond. If inflation is lower than 1.6% over 10 years, the linker will pay out less money than the nominal bond.
For context, US CPI’s been running below 2% for basically ten years now, so “higher than 1.6” is not a sure bet.
And TIPS don’t “protect against deflation”. If they did well in inflationary and deflationary environments that would be a pretty great product! TIPS got toasted during March and April because inflation was imploding and deflation was a real risk.
(There is one subtle technical case where US TIPS don’t underperform in a deflationary environment. Note, this only applies to freshly-issued TIPS, which may not be in your TIPS ETF of choice, and it doesn’t apply to TIPS from other countries which use different calculation and payout methods. I used to sit next to the bond and rates guys at my previous job building trading software, and boy oh boy there are a lot of weirdnesses in even the simplest-looking bonds.)
Respectfully correcting your terminology. what u r referring to is lump summing not dca. Lump sum every month without any money left for Investment is still lump sum.
I think we’re getting into terminology discussions here. If you buy a regular amount every month, then you’re dollar-cost averaging if you look at it over the long term, because you’re buying a roughly fixed dollar amount every month, and you’re getting DCA’s benefit of capitalizing on dips in the market. From the point of view of
that month, you’re lump-summing, but... that’s not a particularly useful view to take?
I’d call what you’re describing (investing a regular investment amount every month) dollar-cost averaging.
Hi ST, what are your thoughts on SPACs such as $shll and $spaq?
HELL NO.
I heard that after the merger goes through and the ticket symbol is changed, they would pretty much guarantee a gain on your capital up to 2x,3x
Is this true and what are the risks involved?
It is not true. You’ve heard wrongly. Companies that reverse-merge into SPACs actually tend to underperform the market.
SPACs are generally a terrible investment; they’ve just gotten weirdly trendy at the moment. Stay right the hell away from them.
Oh god, DGAZF, what a fiasco.
OK, so here’s the scoop. DGAZF, and its slightly less monstrous twin brother UGAZF, were a pair of 3x-leveraged natgas ETNs run by Credit Suisse. They were both delisted a few months ago, and Credit Suisse (the issuer) stopped supporting them with creation/redemptions, but were still available to be traded on the (extremely illiquid) over-the-counter market.
Because the OTC market is illiquid, and a few idiots bought some of it, DGAZF started trading at a premium to the value of its underlying assets. “Smart” people saw it trading at a premium and decided to short it, because they assumed it would converge to the value of the underlying assets.
The problem is, for ETFs and ETNs to converge, there has to be a functioning creation/redemption mechanism. And Credit Suisse stopped doing creation/redemptions a few months back.
Uh-oh.
So DGAZF just kept going up. And people kept shorting it, but it kept going up. And then people started getting stopped out of their shorts, so it went up even more, and more, and more, and more... and a couple of funds blew up on the back of their losses shorting DGAZF.
The moral of the story, if there is one:
A) Don’t trade OTC stocks.
B) Don’t trade leveraged ETFs.
C) Don’t try to do ETF arbitrage.
D) Especially don’t try to do ETF arbitrage on leveraged ETFs that are only traded OTC.