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Subjunctive posted:That doesn't seem right, practically. Many stocks don't pay dividends, but still climb in price. Shouldn't GOOG be priced at $0, since there are no known plans for it to pay a dividend? Or does the NPEV in this case include some prediction that they will start to? You're right! But the above wasn't a typo -- this is a standard framework for thinking about stock prices (an even better example than Google is Berkshire Hathaway). You can argue that just because GOOG doesn't pay a dividend now, it doesn't mean they won't at some point, but I agree that that isn't totally satisfactory.
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Feb 6, 2017 21:00
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Lead out in cuffs posted:This is a question coming from a place of extreme naivete here, but: a) Financial markets are not a zero-sum game. Productivity accrues over time; we get richer - this fact is captured in rising stock markets over decades, despite the crazy fluctuations that occasionally occur. At least, this is the central principle behind capitalism... people can and do reject it, but if you do, you probably have no business investing in equities. b) It's a virtual certainty that Google will cease to exist at some point; it might just take a century or longer to get there. The stock price is a collective 'estimate' of all that value generation out to the future. It's completely unknowable, of course, so consider it the best guess we have. In mathematical terms, it's the expected value of a high variance random variable.
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Feb 7, 2017 00:44
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Lexicon posted:a) Financial markets are not a zero-sum game. Productivity accrues over time; we get richer - this fact is captured in rising stock markets over decades, despite the crazy fluctuations that occasionally occur. At least, this is the central principle behind capitalism... people can and do reject it, but if you do, you probably have no business investing in equities. a) I dunno -- my rejection of perpetual growth doesn't preclude me from believing that growth is going to continue for some period of time (likely measured in decades rather than centuries), which feels like enough of a rationale to be investing in equities as part of a balanced portfolio. Also, my understanding of index ETFs was that they combine share price with dividend income in their value (please correct me if I'm wrong, in which case maybe I should be mixing in more dividend-centric ETFs). I'm not sure I accept that perpetual growth is a central tenet of capitalism, since I've seen static-growth models of capitalism proposed. (E.g. focusing on dividends enable businesses to exist in a steady state of profitability without being punished by the market/investors for not growing). b) I'd be very, very surprised if Google was still growing a century from now, and honestly at least a little surprised if it even still existed. (I really hadn't known about the zero-dividend thing with Google, and now am kinda struggling to see much difference between investing in Google and, say, buying Bitcoin. I guess because there's a real company whose performance the share price is supposed to track, but that kinda breaks down too, since investors don't see any of Google's profits, so it's all perceived value.) Thanks for the reply, though.
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Feb 7, 2017 02:48
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So I've been slowly reading through this topic and you guys in 2015 said to avoid Canadian stocks. Is that still the case now? I'm going with CCP's aggressive allocation and have the 30% CDN index and 10% Bonds. However I still have a bunch of funds coming up that I can invest so I can easily fix that allocation at this point in time.
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Feb 7, 2017 02:51
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I think Canada's economy is trash and that trash is going to be on fire soon. I also think by living and working in Canada you're already massively "overexposed" to Canada so even 30% is way too much. I only have 10%. But that's just my opinion, maaaan.
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Feb 7, 2017 03:02
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Zettace posted:So I've been slowly reading through this topic and you guys in 2015 said to avoid Canadian stocks. Is that still the case now?
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Feb 7, 2017 03:25
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Lead out in cuffs posted:b) I'd be very, very surprised if Google was still growing a century from now, and honestly at least a little surprised if it even still existed. (I really hadn't known about the zero-dividend thing with Google, and now am kinda struggling to see much difference between investing in Google and, say, buying Bitcoin. I guess because there's a real company whose performance the share price is supposed to track, but that kinda breaks down too, since investors don't see any of Google's profits, so it's all perceived value.) It's kinda like money. We all believe it has value, so it does.
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Feb 7, 2017 03:39
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cowofwar posted:Just go VXC/VAB. These are ETFs right? Why would these be better?
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Feb 7, 2017 16:10
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Zettace posted:These are ETFs right? Why would these be better? Yes. VXC is worldwide excluding Canada, which ties into what has been said of avoiding overexposure to Canada. VAB is Canadian bonds. There's not as much of an advantage in diversifying when it comes to bonds than equity, on the contrary, it exposes you to currency volatility, so I don't think anyone will recommend holding non-Canadian bond funds.
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Feb 7, 2017 17:39
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Zettace posted:These are ETFs right? Why would these be better? Mutual funds are ok too, if they're cheap (TD e-Series).
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Feb 7, 2017 22:30
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Lobok posted:It's kinda like money. We all believe it has value, so it does. Yeah, true that. Again, though, I don't quite see the difference between that and the arguments you hear from buttcoin supporters.
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Feb 8, 2017 01:17
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Lead out in cuffs posted:Yeah, true that. I think the difference is that national currencies have a country's entire population standing behind it, while Bitcoin really has nothing. But as long as people continue to believe it has value, then it has value. But its foundation is on much shakier ground than a national currency. I'm talking out of my rear end here, but I don't think I'm entirely off base. Someone correct me if I'm wrong. edit: Just checked Buttcoin price. Man do I ever wish I had of bought/mined some pre-2013.
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Feb 8, 2017 02:38
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Does anyone know of any publicly traded mortgage and loan companies in Canada? All the ones I seem to find are private. I've even taken to googling the ones I hear on radio ads and they're never public. The sketchier the better.
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Feb 8, 2017 06:16
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e: probably not best thread sorry
slidebite fucked around with this message at 07:13 on Feb 8, 2017 |
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Feb 8, 2017 06:52
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former glory posted:Does anyone know of any publicly traded mortgage and loan companies in Canada? All the ones I seem to find are private. I've even taken to googling the ones I hear on radio ads and they're never public. The sketchier the better. Rifco (rfc) First National Financial (FN) Home Capital Group (HCG) Also if you want to invest in mortgages directly then check this article out. I can't speak to the veracity or whether these structures still exist but this was something from a few years back. http://www.canadiancapitalist.com/publicly-traded-mortgage-investment-corporations-mics/
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Feb 8, 2017 09:29
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So my girlfriend is a Canadian Permanent Resident, originally from China, and doesn't know how investing works here. She has money saved up from work in a Scotiabank checking account, but it's not generating any interest. I want to tell her to invest in the Vanguard All Cap Ex Canada ETF and just leave it there to generate good returns. Should she make an account through Scotiabank iTrade? Or is it worth it to open a Questrade account and invest through that?
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Feb 9, 2017 01:37
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Ccs posted:So my girlfriend is a Canadian Permanent Resident, originally from China, and doesn't know how investing works here. She has money saved up from work in a Scotiabank checking account, but it's not generating any interest. I want to tell her to invest in the Vanguard All Cap Ex Canada ETF and just leave it there to generate good returns. Should she make an account through Scotiabank iTrade? Or is it worth it to open a Questrade account and invest through that?
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Feb 9, 2017 01:40
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cowofwar posted:Has she considered a chinese-canadian real estate ponzi scheme? They are pretty popular right now. The Chinese are very private about their finances, answering that question would go against their culture.
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Feb 9, 2017 02:47
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Kalenn Istarion posted:Rifco (rfc) Thanks very much, this was really helpful. And I'm bookmarking that blog because the comments and posts seem pretty solid.
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Feb 9, 2017 04:47
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cowofwar posted:Has she considered a chinese-canadian real estate ponzi scheme? They are pretty popular right now. Is there an index fund for those? But seriously, she's not one of those rich kids from the family of corrupt officials, she immigrated to Canada to get away from China's toxic culture towards women and get into the tech industry. She's got to do some catching up financially to really save properly for retirement, and Vanguard seems like the way to go. The question is whether Scotiabank as the brokerage is a good choice.
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Feb 9, 2017 05:28
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Ccs posted:Is there an index fund for those? If you just want mutual funds and are patient then TD efunds are the way to go. Otherwise RBC, scotiabank, BMO whatever all offer brokerage services of comparable quality so pick whatever is convenient.
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Feb 9, 2017 06:26
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Ccs posted:Is there an index fund for those? I would suggest a) don't just buy the Canadian one and b) don't put all your money with the same fund management company. Ideally you want a mix of different market exposures (Canada, us, international excluding us), and different fund managers (to protect against the chance of a fund manager imploding and also to avoid style bias). E: also buy bonds, the proportion of your portfolio that should be bonds / a bond fund depends on how young you are and also how volatile your personal income is.
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Feb 9, 2017 16:54
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Blackrock funds complement Vanguard ones pretty well just in case John Bogle turns out to be a mastermind ponzi schemer.
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Feb 9, 2017 19:50
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Kalenn Istarion posted:don't put all your money with the same fund management company. Ideally you want a mix of different market exposures (Canada, us, international excluding us), and different fund managers (to protect against the chance of a fund manager imploding and also to avoid style bias). How big of a thing is this? I've just realised that all but one of my ETFs are held by Blackrock.
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Feb 9, 2017 21:28
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Lead out in cuffs posted:How big of a thing is this? I've just realised that all but one of my ETFs are held by Blackrock. Do you remember Bernie Madoff Or long term capital Or AGF
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Feb 9, 2017 21:35
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Kalenn Istarion posted:Do you remember Bernie Madoff No, but I've just looked them up and point taken. Looks like I'll be diversifying into holding a few more ETFs (from other companies).
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Feb 9, 2017 21:40
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Madoff scheme not quite the same as Vanguard ($3.6 trillion AUM). Vanguard going down would be crazytown. Not that diversifying is bad but if Blackrock or Vanguard went down it would likely be for macro reasons that would take down the other as well.
cowofwar fucked around with this message at 22:08 on Feb 9, 2017 |
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Feb 9, 2017 22:06
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Vanguard isn't gonna take your monies guys. Worry about real risks.
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Feb 10, 2017 01:36
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Lexicon posted:Vanguard isn't gonna take your monies guys. Worry about real risks. Diversifying fund management companies is a well documented and measurably beneficial element of any portfolio management strategy It also reduces the risk of someone blowing up - "[Name of big fund here] isn't going to fail guys" is quite literally the attitude that caused such a horrendous disaster in 2008/2009. I'm not saying they're at huge risk but there's basically zero downside to picking several different managers as long as they aren't materially different cost structures and performance and they meet your objectives
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Feb 10, 2017 02:41
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Kalenn Istarion posted:Diversifying fund management companies is a well documented and measurably beneficial element of any portfolio management strategy
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Feb 10, 2017 03:33
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cowofwar posted:ETFs aren't subprime mortgages wrapped as misvalued asset backed securities. Nope, they're large pools of funds run by people of varying integrity and use varying degrees of leverage and have rules that can make them go insolvent in long tail market events. Do you know how much derivatives are used as overlays in large institutional portfolios? they aren't magic immortal permanent money pockets, and I don't see how you can credibly argue that having your Canadian equity with vanguard and your us equity with blackrock (or whoever) isn't worth doing all else being approximately equal
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Feb 10, 2017 04:27
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So following your guy's advice, I decided to invest less in Canada. Basically, instead of investing 30% of my funds in Canada I'm investing 15%. I then allocated that to the US index fund instead. So my allocation is: 10% CDN bonds 15% CDN index 45% US index 30% Int. index Is there any glaring flaw I'm see not seeing here? From my point of view it's still just the CCP allocation with more weight on US.
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Feb 10, 2017 04:30
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Zettace posted:Is there any glaring flaw I'm see not seeing here? The US doesn't represent 45% of the world economy.
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Feb 10, 2017 04:53
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Zettace posted:So following your guy's advice, I decided to invest less in Canada. US represents 35-40% of global market cap but tends to have an outsized return. Canada represents 3% of global market cap. My allocation is 70% VXC and 30% VAB, obviously personal preferences but splitting up your allocation like in your example is kind of antiquated Canadian mutual fund nonsense from 15 years ago. Kalenn Istarion posted:Nope, they're large pools of funds run by people of varying integrity and use varying degrees of leverage and have rules that can make them go insolvent in long tail market events. Do you know how much derivatives are used as overlays in large institutional portfolios? cowofwar fucked around with this message at 04:56 on Feb 10, 2017 |
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Feb 10, 2017 04:54
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cowofwar posted:US represents 35-40% of global market cap but tends to have an outsized return. Canada represents 3% of global market cap. Jesus Christ it's like everyone completely skips over the part where I mentioned that there is discrete and measurable benefit from diversifying management style in your portfolio. This means that, assuming costs are similar, owning two funds managed by two managers with similar strategies has a diversifying benefit versus owning one fund
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Feb 10, 2017 05:08
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Kalenn Istarion posted:Jesus Christ it's like everyone completely skips over the part where I mentioned that there is discrete and measurable benefit from diversifying management style in your portfolio. This means that, assuming costs are similar, owning two funds managed by two managers with similar strategies has a diversifying benefit versus owning one fund https://www.google.ca/finance?cid=748641932075571 You can drop TSE:VXC and TSE:XAW in and they track basically identically. cowofwar fucked around with this message at 05:24 on Feb 10, 2017 |
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Feb 10, 2017 05:22
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Jan posted:The US doesn't represent 45% of the world economy. Googling shows the US is 17% of the world's GDP but 17% of my investments being US one's seems too little.
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Feb 10, 2017 05:57
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Kalenn Istarion posted:Jesus Christ it's like everyone completely skips over the part where I mentioned that there is discrete and measurable benefit from diversifying management style in your portfolio. This means that, assuming costs are similar, owning two funds managed by two managers with similar strategies has a diversifying benefit versus owning one fund Everyone is discussing passively managed funds.
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Feb 10, 2017 06:11
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grack posted:Everyone is discussing passively managed funds. Even passive funds have style differences in things like inclusion thresholds ( how small a position do you include to balance cost vs minimizing tracking error), rebalancing policy, aggressiveness of self trading to keep share price in the range of fundamental value, etc
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Feb 10, 2017 10:06
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Is this still the go-to for people who just want to set up some good investments with little hassle? http://canadiancouchpotato.com/model-portfolios-2/ I'm thinking of signing up for a Tangerine Investment Fund since I don't mind paying slightly more MER for the convenience of the service. Just not sure if there's a better guide out there showing options I don't know about. triplexpac fucked around with this message at 15:23 on Feb 10, 2017 |
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Feb 10, 2017 15:12
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