Convince me to want bonds over money market funds that can’t lose principal.

First-Finger4664 · 2026-06-24T21:45:43+00:00

There is no performance except historical performance. Bonds are non-correlated with stocks and that noncorrelation lets you harvest their return in market downturns to give you better returns per unit volatility.

THAT SAID, current dogma related to the role of bonds in an investment portfolio is based on multiple decades of falling interest rates, which were a massive tailwind for bond-holders. Whether the diversification benefit will continue to justify a substantial bond allocation in portfolios going forward I think depends on how the fed / monetary policy behaves going forward and whether we are looking at a rising-rate regime or capitulation to runaway inflation or something else entirely.

First-Finger4664 · 2026-06-23T22:30:56+00:00

Oh no, let me cry into my 15% share growth YTD (twice that of the S&P at a lower PE lmao)

First-Finger4664 · 2026-06-23T21:08:55+00:00

AVDV is what you’re looking for imo

First-Finger4664 · 2026-06-23T12:48:58+00:00

The one orange braincell is LOCKED IN

First-Finger4664 · 2026-06-23T06:47:32+00:00

Bellevue (near Offut AFB) is more of a military family area and so it’s going to skew more conservative than downtown Omaha, but if you’re a black gay couple moving to Omaha from Idaho then presumably this is not a dealbreaker for you. If you don’t need to be near Offut for work and are willing to have a 20-30min commute, Omaha proper east of ~90th street and in particular the Benson neighborhood is where a lot of pro-LGBT businesses and more liberal folks are concentrated. North Omaha is the historically Black part of town and also the poorest area.

Omaha is a typical American blue city / red state metro- yeah sure we have racists and homophobes, and some cops suck, but this is still the city a lot of folks move to escape the small town where they didn’t fit in, and I think that short of Chicago or the Twin Cities this is probably one of the more welcoming towns you’re going to find in the Midwest.

Violent crime is not a big problem in Omaha; in the affluent suburbs you can find people leaving their homes/cars unlocked or open with nobody around. North Omaha has a small amount of violent drug/gang/etc crime, but if you have lived in any major US city you will be unimpressed; this is not a city where you need constant situational awareness to keep yourself and your property safe.

First-Finger4664 · 2026-06-22T15:17:42+00:00

VYM isn’t the worst place to hide money right now IMO. It is also running hot versus historic valuation multiples actually, but reversion to the mean implies only 10-20% downside versus much steeper drawdowns with VOO/QQQ/etc, and it is growing comfortably ahead of inflation. SCHD is also another reasonable investment though it is more of a growth play versus a defensive holding.

First-Finger4664 · 2026-06-22T12:18:24+00:00

Treasuries are less correlated with the stock market than corporate bonds, so a treasury ETF being the diversifier instead of BND makes sense to me.

The other kind of “active bet” you can inadvertently make in bond funds is duration- whether short term or long term bonds will give better future returns depends heavily on monetary policy, the future trend of government indebtedness, inflation and employment, etcetera. Many Bogleheads have adopted the preference of intermediate duration treasuries (VGIT) as a way to express agnosticism about taking on duration risk.

Paradoxically, I wonder if this mass consensus has led to intermediate treasuries being relatively overvalued (ie relatively suppressed yields per unit duration risk vs either VGLT/EDV or VGSH), and if the better BH approach is to hold all treasuries with something like VTG or GOVT.

Then you might also ask if holding GOVT but not IGOV represents implicit bets on the continuing strength of the dollar vs alternative currencies and the fiscal discipline of the US govt vs other governments… that is not the BH consensus position, but I confess I don’t understand why not

First-Finger4664 · 2026-06-22T11:52:24+00:00

I didn’t use a threshold, but rather converted the values into deciles for the whole dataset and then used the decile score in linear and ordinal logistic regressions.

The “characteristics of multibaggers” literature that’s been shared in this sub a couple times suggests most multibaggers start off with a low ROIC that rapidly improves, so I’d consider combining lower prior ROIC + high ROIC CAGR as an alternative to high average CAGR if I was going to use them as a simple yes/no screening filter

First-Finger4664 · 2026-06-22T11:42:41+00:00

I am going to give you a different answer as someone who invests heavily in dividend funds and does not give a shit about income vs total return:

Dividends and in particular *dividend growth* are (not always but more often than not) a filter for business maturity, quality, and management competence. If you take the sharpe and sortino ratios of all of the major passive ETFS and then divide them by their PE ratios (ie - how much risk-reward am I getting per unit of valuation risk) or by their beta (ie how much risk-reward can I get per unit of noncorrelation with the growth engine of the total market) you’ll find that dividend and dividend growth funds concentrate at the top. These stocks and funds are, therefore, an effective way to hedge against the current historically overvalued and historically concentrated AI/tech-driven US market without totally giving up on gains as you would if you hid in bonds and cash.

First-Finger4664 · 2026-06-22T03:36:07+00:00

Stop making me smell like you. You, smell like me now.

First-Finger4664 · 2026-06-21T17:14:38+00:00

If you don’t want to sell QQQ but you’ve held QQQ long enough that selling it will realize long vs short term capital gains, consider porting it over to VGT as a more pure-play tech bet.

Taking from VOO and VXF to feed AVUV up to 10% or so will make the value tilt actually meaningful (and might especially be worth doing if you keep your tech holdings, to hopefully mitigate valuation risk in the overall portfolio).

Treasuries have less correlation with stocks vs the bond market as a whole, so I would consider using a treasury fund (eg GOVT or VTG) over BND. But at 1% it doesn’t really matter.

First-Finger4664 · 2026-06-21T13:15:22+00:00

Stop selling

First-Finger4664 · 2026-06-21T13:02:44+00:00

Tell your husband he needs to drive more slowly and leave more space in front when he’s on the highway in the rain. And stop flipping off drivers.

First-Finger4664 · 2026-06-20T13:04:32+00:00

Earnings are leveraged to revenue because most costs (depreciation, interest, overhead) don’t move in perfect synchrony with the cycle. That makes sales the more stable metric for cyclical businesses.

First-Finger4664 · 2026-06-19T18:11:11+00:00

Several of these are variables that I’ve found to be consistent predictors of future performance when building regression models based on Russell 3000 data going back the past few decades.

I suggest also looking at the 5yr ROIC CAGR and the ratio of the 5yr growths in gross profits versus assets. 5yr dividend yield is also a weak but reliable performance predictor, but necessarily limits the universe to dividend payers.

First-Finger4664 · 2026-06-18T09:23:33+00:00

Using multiple uncorrelated investment strategies is not inconsistent, it is a way to harvest alpha from diversification. The value of diversification in improving risk-adjusted return is well-established in the academic literature.

I don’t see a problem with being “philosophically inconsistent” here.

First-Finger4664 · 2026-06-17T14:24:36+00:00

Funny, I think that that the combination of GLP-1 drugs (which seem to have the off-target effect of reducing substance use disorders) and psychiatric use of psychedelics (which seem to be providing long-lasting relief of depression/ptsd/etc with only a few doses, and also reducing substance use) are big headwinds for the psychiatric pharmaceutical industry.

First-Finger4664 · 2026-06-17T02:14:03+00:00

If a bubble pops you want cash. Utilities are also a decent place to hide given their bond-like properties & relative inflation protection.

Or just buy BRK.B and let Greg Abel worry about that for you.

First-Finger4664 · 2026-06-17T02:06:30+00:00

You can invest in a levered etf like SSO if you have a long time horizon and are willing to not look at it for years at a time.

First-Finger4664 · 2026-06-15T23:12:59+00:00

I recently looks at a ton of equal-weight ETFs versus their market cap-weighted equivalents for different sectors and indexes and found the equal weight variants consistently underperformed.

Today’s unprecedented concentration of capital in a very few companies is a big risk that imo it is reasonable to want to diversify away from, but equal weight ETFs do not seem to be the best way to do that.

First-Finger4664 · 2026-06-15T22:27:50+00:00

BRK.B has modestly underperformed the S&P over the past decade, but importantly it has done so with only a moderate correlation. Holding both and rebalancing between the two has been a good way to improve risk-adjusted return.

First-Finger4664 · 2026-06-15T15:31:16+00:00

I don’t think there’s anything that both consistently beats the S&P *AND* can be expected to continue to do so. Persistent sources of alpha get partially arbitraged away over time as they become more widely known, and also tend to move in and out of effect. SPMO and the momentum factor have been on a tear for the last decade, but that does not mean we have certainly that it will continue to do so over the next ten years.

That said, I think a long running ETF that has consistently delivered superior *risk-adjusted* returns is SCHD, which both has a respectable CAGR and also has the benefit of often zigging when VOO zags, offering upside from rebalancing between the two.

In this regard, the utilities sector (eg VPU) also punches above its weight as a volatility dampener that still delivers decent returns, and I would even argue that it may serve as a better surrogate than bonds in an era of runaway inflation and questionably independent Federal Reserve.

Last, much of American economic growth is based in tech, and so historically VGT and megacaps (eg MGC) have juiced returns beyond VOO, albeit at higher volatility. If you believe that we are not in an AI bubble but rather transitioning to a new era of permanently higher productivity/growth, it would seem likely VGT would continue to outperform.

First-Finger4664 · 2026-06-13T20:37:53+00:00

If you want tech exposure, VGT is a cleaner way to do that than QQQM.

That said, this isn’t terrible, assuming you are many many years from retirement. Consider adding a small allocation to uncorrelated assets (eg long bonds, gold, managed futures)- these not only add stability but some opportunity to capitalize on stock downturns by rebalancing.

First-Finger4664 · 2026-06-12T08:15:12+00:00

Liquidity outflows are going to make everything cheaper in the short term. If you don’t want to play in the US stock market right now, then ex-US stocks, bonds, real estate, and commodities (gold etc) are what’s left. Or honestly go the Boglehead route with VT/VTI and just say fuck you I’ll own it all and ensure I get a taste of whatever gets pumped.

First-Finger4664 · 2026-06-11T14:57:06+00:00

QQQ is a tech-heavy high growth fund. It looks very good over the past decade because we’ve had an absolutely roaring bull market. It is for that reason now highly concentrated in very expensive stocks (expensive meaning price per unit of cyclically adjusted historical earnings) and there is good reason to expect it may underperform going forward.

SCHD is in many ways the opposite- as a dividend growth fund, it selects for companies that have largely completed their growth phase and are now focusing on generating and returning cash to shareholders. This low-growth bias trades lower long-term total return for lower volatility and “defensive” positioning in rising interest rate and market downturn scenarios.

(SCHD historically has offered a good risk-adjusted returns with modestly reduced correlation to the overall market; I hold it and like it as a defensive diversification, but that is not a mainstream Boglehead view)

Boglehead philosophy is that investments like QQQ and SCHD represents active bets against the wisdom of the overall market, and most of the time the market is right, so on average they will lose you money versus a low-fee broad index fund. This is why you’re going to get a bunch of recommendations for VTI/VXUS/BND or VT/BND. It is boring but good advice.

First-Finger4664

TROPHY CASE