Half year FIRE portfolio status

[mikew]

Ben
Can I ask you why and how you use offshore hedge funds in your portfolio especially in relation to your index funds?

I have a couple of these through my wife but we are in the process of rebalancing towards indexing.

Mike

[preben]

As you know I always refer to my "base portfolio" and do not include RE (cause I live there myself/no plans to sell) and also not the strategic/gambling money. As to hedgefunds I must admit that I have not put much thought into it - as the return from my base portfolio should be enough in FIRE. I DO like the fact that it has very little correlation with anything else - and I also managed to find some with low fees and a simple strategy. That said I am this year going to review my use of same and will post here if reach any conclusions. Cheers!

Quote:

Originally Posted by mikew Ben Can I ask you why and how you use offshore hedge funds in your portfolio especially in relation to your index funds? I have a couple of these through my wife but we are in the process of rebalancing towards indexing. Mike

[OldAgePensioner]

Laurence, "brightly colored plumage" , that's the ticket. A man can be very happy with that.

mikew,
I'm with ya dude. Keep the faith, you got a real jump on me since I didn't even think it would be difficult. In Australia, back in 1990, the phone calls were like $2/min and letters took 2-3 weeks. I lost so many connections/casual friends/real friends due to distance. I suspect you have similar situation in Japan but you've at least thought though what coming back might be like, Nords might be best to talk with (seems, wired).

[mikew]

Ben

Thanks for the information. I am wavering between keeping our hedge funds or getting out. There was an article in the NY Times a couple of months ago. The focus was on US onshore hedge funds. The UK style offshore hedgefunds may operate differectly. The basic thrust was that with the boom in hedge funds the funds need to do increasing riskier things to keep the same returns. This includes using more leverage.

The following article has most of the same ideas but the thrust is different.
http://www.nytimes.com/2005/07/03/bu...ey/03view.html

[Spanky]

Quote:

The best long term answer I have come up with is move to Hawaii or somewhere else with a strong asian community.

Mike,

How about California (the Bay Area, Southern Cal) or Seattle (very close to Vancouver)? These places have strong Asian communities.

Spanky

[BUM]

I'm also grateful for the help divvies have given my port for the 1st half! I'm up 2.2% Which I suppose is pretty darn good considering the quote from a NYSE trader on CNN, "Flat is the new up."


BUM

[Spanky]

Ben,

I am up about 4% YTD. 8)

Winners:
REIT, Health care, International Explorer

Sleepers:
Total Market, Money market, short-term bonds, Pacific, Europe

Spanky

[malakito]

Just checked: Quicken says 3.75% from 1/1/05 to 6/30/05. This is higher than the S&P500 because my company stock (which I am whittling down but right now is perhaps 6% of my portfolio) is allegedly up 52% over that same period.

malakito.

[mikew]

Quote:

How about California (the Bay Area, Southern Cal) or Seattle (very close to Vancouver)? These places have strong Asian communities.

Spanky

I am interested in checking out the west coast. As well as Tennesse and a couple of other places. The reason I am interested in Hawaii is Hawaiin time seems to move slower than normal.

Thanks
Mike

[Cb]

We're up 2.5% so far...if we see another 2.5% I might call it quits in January!

Cb

[MRGALT2U]

Quote:

Originally Posted by Cb We're up 2.5% so far...if we see another 2.5% I might call it quits in January!* Cb

I don't quite understand this. The decision hangs on whether you pick up another 2.5% by January? Why? I can't see why 2.5% up or down would have any real impact. I could spend 2.5% of my total NW (not much)
and hardly notice it. I certainly wouldn't let such a small move effect my
ER planning. You should control the timing, not some future unknown and
uncontrollable event.

JG

[Cb]

Quote:

Originally Posted by MRGALT2U I don't quite understand this.* The decision hangs on whether you pick up another 2.5% by January?* Why?* I can't see why 2.5% up or down would have any real impact.* I could spend 2.5% of my total NW (not much) and hardly notice it.* I certainly wouldn't let such a small move effect my ER planning.* You should control the timing, not some future unknown and uncontrollable event. JG

I agree that 2.5% is noise. I'm quite confident I'm good to go now, but will cantinue to work until Jan 3 because:

- it gets me a few more quarters of SS contributions

- it gets me a few more % in pension entitlements

- we're saving ~$8K/month now

- those three items, plus a few % of market return get's us safely into the magic 95% safe number per FIREcalc. In my "How This Is All Going To Work" opus to my wife I mentioned that a

95% SWR x 95% last survivor mortality* = > 99% effective SWR.

*55 years for us

Believe me, it WOULD matter to my wife if I punched out a few months early on the "Magic Number"

- it gets me 5 new weeks of vacation (I haven't used any vacation time this year, so between vacation entitlement, holidays, maybe a few mental health days, cable guy appointments, runny nose days, etc, I'm looking at a pretty nice % of work days/off-days at this point)

- I might have a bit more clarity on the appropriate amount of reduction I should use for our SSI entitlements by January. (I'm chopping SSA projections by 25% in my spreadsheet now, but I think that's probably a bit too conservative. I'm 45 now and figure on a ~$65K income in retirement, and I can't imagine the AARP letting Congress cut bennies to members of the massive boomer generation struggling to get by on mere $65K by 25%. What I think might happen is we get a half-a$$ed solution in 2005-2006, and have to do it all over agian in 10-15 years. By the time the next SS "fix" takes place we'll probably be in the "hands-off" (>55 or 60) age group. So I think '05-'06 solution is worth knowing. If Congress can't get it's act together by January I'll be comfortable punching out based on the 25% whack.

- my current workload is manageable, the projects are fairly interesting (maybe another patent award or two), and I don't foresee any uncomfortable encounters with any upper mgmttypes who matter in the next several months.

- it allows me to exercise my remaining stock options in '06, getting away from 2005 AMT

Does that help?

Cb

[malakito]

Quote:

Originally Posted by Cb - it allows me to exercise my remaining stock options in '06, getting away from 2005 AMT Does that help? Cb* *

Not that it particularly matters much...if I were to leave my company voluntarily without incentive (I'm actually leaving with incentive, but anyway...) I would have I think, 3 or 6 months after I left to exercise options (subject to their expiry dates, of course). You don't have something similar?

malakito.

[Cb]

I don't think so...I'm pretty sure they expire immediately upon resignation.

Additonally, our bosses gets a notification whenever we exercise anything...and there's no benefit in tipping my hand prior to giving my notice, right?

Cb :P

[Nords]

Quote:

Originally Posted by mikew I am interested in checking out the west coast. As well as Tennesse and a couple of other places. The reason I am interested in Hawaii is Hawaiin time seems to move slower than normal.* * Thanks Mike

The difference between Hawaii and all those other places is winter.

I think winter weather makes time move a lot more slowly.

[wabmester]

Quote:

Originally Posted by Spanky How about California (the Bay Area, Southern Cal) or Seattle (very close to Vancouver)? These places have strong Asian communities.

Agreed about SoCal and Vancouver, but have you ever been to Seattle, Spanky? Asians stand out like a sore thumb here. I'm not sure why it is, but it might be because Washington and Oregon have a pretty ugly history wrt discriminating against Asians. They chased the Chinese out of the area after enslaving them to build the railways here. They chased the Filipino farm workers out during the 30's. And remember the Japanese internment during WW-II? That started in the Pacific Northwest.

Lots of Scandanavians here though.

[retire@40]

Net worth excluding real estate but including added savings from earned income is up 9.09% through 6/30. *My portfolio return was in the 3% range. *I'm still in the accumulation phase, so the only number that is important to me is net worth.

[Jarhead*]

Quote:

Originally Posted by Spanky Mike, How about California (the Bay Area, Southern Cal) or Seattle (very close to Vancouver)? These places have strong Asian communities. Spanky

Hell, Spanky, I've lived in Calif. all my life, we like everybody out here. (Unless you're an a--hole, and that can come in any shape and color)

Jarhead

[haha]

Quote:

Originally Posted by wabmester Agreed about SoCal and Vancouver, but have you ever been to Seattle, Spanky?* *Asians stand out like a sore thumb here.*Lots of Scandanavians here though.*

This may be because of where you live. In Bellevue and Seattle any well behaved person is very welcome. I have lived in various communities in WA over for 30 years, and I don't think I have ever heard a disparaging remark about an Asian.

Ha

[laurence]

Seattle is an awesome city, if you are into culture. I like San Fran, but it's just so costly. Portland is quieter, but still very high on my list. I haven't seen anything more beautiful than the pacific northwest.