Bonds may outperform stocks in the next 10 yrs

I figure that after my last post on stock market returns for the next 10 years, I’ll try and do something similar for bonds. After all, these are the two most important assets classes that make up retiree portfolios, often in the much talked about 60%/40% stock, bond allocation. Without taking a crack at this you can’t forecast portfolio returns…

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SP500 to return 5% per year in next decade

So says John Hussman. First, if you don’t know who Hussman is, I recommend that you get to know him. Hussman is a mutual fund manager who runs the Hussman Funds. He is a value oriented manager but also focuses heavily on managing risk, i.e capital preservation in bad market environments. But Hussman is also an economist, an insightful one…

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Some income investors have gone plain nuts!

All markets experience periods of excesses. It looks to me as if we’re getting to one of these times with the fixed income markets. The news item that led me to this post was about a foreign bond – ‘Mexico floats century bond in a hungry market’. An excerpt from the story; MEXICO CITY, Oct 5 (Reuters) – Mexico launched…

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High investment fees will ruin your retirement

High investment fees hurt. We should all try to minimize them. Conventional wisdom, right? In one way you would think so with the rise of firms like Vanguard, discount brokers, ETFs, etc… On the other hand, there has been the massive rise of hedge funds, derivatives, and other esoteric products that have high fees. Given how much fees can impact…

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How to live off your dividend income

The goal of many, if not most, retired dividend investors is to generate enough income via dividends to cover their living expenses. And additionally to have that dividend stream increase faster than inflation. Sounds like a great goal. If you can achieve it then you can let the principal ride and compound in the market and not worry about the…

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Understanding volatility and compound investment returns

Well, the Gators got slaughtered this weekend and it looks like I’ll lose at least one of my fantasy football matches today. But I do have the Dolphins left tomorrow night against the Pats – there’s still some hope to salvage the weekend. A quick investment blurb for this rainy cold Sunday night in Eastern Tennessee. In reading investment commentary…

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Tech stock dividends: Microsoft

One week ago I posted about tech stock dividends and that tech stocks may become great dividend stocks in the future. Well, its one week later, the Gators are playing again (this time vs Bama, god help us) and its time to revisit tech stock dividends again. My conclusion in last week’s post was that it was too early to…

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Living a better retirement: withdrawal rates higher than 4%

I’ve discussed the 4% withdrawal rule, the safe withdrawal rate (SWR), a couple of times already; in my post on how much does it take to retire and the one on how to actually use the 4% rule. Great, we’re all prepared for a safe and happy retirement. But wouldn’t it be great to able to withdraw more than 4%,…

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Dividends: the great bear market protector

In a previous post on dividend investing I mentioned why I choose to invest in dividend stocks. Its simply because of the higher long term compounded returns (see here for details). Today I’ll discuss another reason to own dividend paying stocks – they protect your portfolio during bear markets.. Or, in other words, they increase your returns during bear markets…

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Inflation: retirement killer

Yesterday’s post got me thinking about inflation. As I said yesterday, “For me, the real risk of bonds is not providing adequate returns to keep up with inflation and taxes over long periods of time, a risk that is rarely talked about.” Inflation is direct reduction to your investment returns whether you investing through a 401K, IRA, or taxable account.…

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