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    Thread: The Money & Investing FAQ

    1. Member jnm2.0t's Avatar
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      01-07-2011 11:37 PM #51
      [QUOTE=beng;64439750]A raise plus more taxes = gets paid less ...right?
      Hah! Just poking around in here but I remember that thread... jesus that was almost a year ago? Sh!t.
      I'm just a regular Joe, with a regular job. I'm your average white, suburbanite slob.

      Quote Originally Posted by Rabbit5GTI
      You have cornered the entire 'I hate Ford Fusions' market around here
      Quote Originally Posted by Turbio!
      Pure electric vehicles will never fully replace fueled (pure ICE or PHEV) vehicles.

    2. Member jnm2.0t's Avatar
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      01-08-2011 03:18 PM #52
      I feel like talking about what I consider one of the most under-used but most important asset evaluation tools... the Sharpe Style Analysis.

      Without being too math-y about it the Sharpe Style Analysis is a constrained regression model of an asset or group of assets against multiple factors (asset classes). Regressing the historical returns of the asset or group of assets against these model factors tells you how what you are analyzing acts. The classic example is a large cap mutual fund. Regressing it against a dozen or so asset classes will tell you how it actually acts. Almost without fail you will find that the fund does not in fact behave as if it is all large cap. You may, for example, find that it behaves like it is 60% LC, 10% MC, 5% SC, 10% bond, and 15% international.

      Why is this important? For a number of reasons really. The two most important ones are that the mutual fund literature will often peg the fund against the S&P 500 and brag about how it beats the returns year after year. If the fund doesn't act like the S&P 500 then who cares really, it is an unrealistic and misleading analysis. What you should do is create a portfolio based on how the fund acts and compare the fund to that, it is often referred to as a real benchmark. That will tell you how well the manager is actually doing their job and if they are adding value or not. Secondly, you should know what you are buying. If you want a LC mutual fund you should at least know it only acts 60% like a LC fund. The manager will tell you that they have never bought MC, SC, Bond, etc. in their life, but that is irrelevant. They may as well have bought it they way their fund is acting. And it is not just mutual funds, often times ETFs and individual stocks don't necessarily behave the way you may think they do. Just because a company is considered a large cap company does not at all mean it acts like one in terms of its stock price.

      Outside of a individual asstes it is important to know for your portfolio itself. Building a portfolio of mutual funds, ETFs, stocks, or any mix you could possibly think you have a great asset mix based on your accepted level of risk and volatility, but running a Sharpe analysis on your portfolio could yield very different results than you expect. It's all about correlations, something you think on the surface may be poorer performing could actually be a better pick because it behaves they way it is intended to. Sometimes adding in what you think may be a poorer performing stock or fund may actually be beneficial to your portfolio because of how it acts in relation to your other holdings. In short, it's not just about picking the best options, it is about picking the best set of options that together act the way you want them to act.

      There are an infinite number of results you will come up with, and using different sets of data (such as 1, 3, 5, 10 year) or different points in time will yield different outcomes, that is important to keep in mind. The regressions need to constantly be updated and rerun which usually requires a lot of manual work, but the results can be very eye opening.

      If you want to read an academic paper about it written by Sharpe go here: http://www.stanford.edu/~wfsharpe/art/sa/sa.htm
      I'm just a regular Joe, with a regular job. I'm your average white, suburbanite slob.

      Quote Originally Posted by Rabbit5GTI
      You have cornered the entire 'I hate Ford Fusions' market around here
      Quote Originally Posted by Turbio!
      Pure electric vehicles will never fully replace fueled (pure ICE or PHEV) vehicles.

    3. Junior Member vgrnt's Avatar
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      10-25-2011 04:17 PM #53
      this is great. sub'd.

    4. 06-10-2012 08:37 AM #54
      I invest money in the Necker Anlagen Fund not so long , but so far I am very happy, It’s safe, profits accrued in time, without any delay, the withdrawal is quick, usually during the day. Advise. I get the profit of about 10% a day. Unbelievable)

    5. 08-03-2012 02:19 PM #55
      Hey guys can anyone recommend a good book to read on investing? I am just starting off and want something relatively short and hopefully interesting. Thanks!

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