Investing

In an effort to simplify and consolidate my portfolio, I recently completed what’s known as a Section 351 exchange in a taxable account. This provision of the Internal Revenue Code lets investors transfer assets—such as stocks and securities—to a corporation without recognizing a taxable gain or loss, provided certain conditions are met.
With help from my financial consultant, I exchanged a portfolio of individual stocks in a separately managed account (SMA), held since 2020, for shares in a new exchange-traded fund (ETF).

I was just reading an interview with Christine Benz from Morningstar. She recommends also having a portion of your portfolio allocated to bonds and cash. Here is her rationale:
“I can definitely see investors emphasizing dividend-payers in their equity portfolios, maybe going exclusively with dividend-payers, but I would augment them with some safer investments. Coming back to cash, coming back to a little bit in high-quality bonds.

…you’re protecting yourself in a few key scenarios. One would be that sort of market downturn if stocks are down and you have something else to pull your cash flows from in retirement,

Right now, the bulk of my US stock holdings are in my Rollover IRA, split unequally between VFIAX (Vanguard 500 Index Fund Admiral Shares) and VEXAX (Vanguard Extended Market Index Fund Admiral Shares). The split has become more unequal than I originally intended. I am taking the whole of my RMD from the 500 fund (and investing it in other funds in taxable), but I’ll still need to move money to VEXAX to rebalance. I am wondering whether it wouldn’t be better (it would obviously be simpler) to combine both funds into VTSAX (Vanguard Total Stock Market Index Fund Admiral Shares).

The normal thinking would have us believing that a bubble is a dangerous situation for our retirement accounts. What if I told you that I believe a market bubble makes your portfolio more resilient? Would you believe me?
Everyone fears bubbles. You should harvest them.
Don’t worry, I haven’t lost the plot, let me be clear: I’m being deliberately provocative to make a point about something some investors neglect when things are going splendidly well, disciplined rebalancing.

BARRY RITHOLTZ’S NEW BOOK, How Not to Invest, offers investors a cautionary tale—many of them, in fact.
Ritholtz has been in and around the investment industry for more than 30 years—as a trader, a journalist and, most recently, as cofounder of a wealth management firm. 
In short, he is no stranger to Wall Street. His conclusion? It can be a minefield.
Bad actors like Charles Ponzi and Bernie Madoff are well known.

The information below seems to show that those who are invested in international markets will benefit from the devaluation of the dollar as they have this year. The reason is as the value of international currencies increase relative to the US dollar investments in international holdings increase in value even without future earnings from their sales.
https://www.morningstar.com/markets/will-dollar-keep-falling?utm_source=eloqua&utm_medium=email&utm_campaign=MorningDigest&utm_content=None_68062&utm_id=35352
In the first half of 2025, the US dollar saw its steepest decline in over five decades. The DXY index—which tracks the dollar against major trading partners—fell about 11% from January to June.

https://www.morningstar.com/stocks/stock-buybacks-are-booming-2025-thats-bad-news-dividend-investors?utm_source=eloqua&utm_medium=email&utm_campaign=MorningDigest&utm_content=None_68062&utm_id=35352
The link above from Morningstar discusses dividends vs stock buybacks and how they affect investors.

Most frauds are based on a false premise about the world. Fraudsters tell a story about this false premise to extract value from their victims. The story driving two recent fraud cases claimed that you can have high investment returns with little or no risk. Mike Hallam was promised annual returns ranging from 12% to as much as 49% that were “safer than government bonds.” Richard Whitacre was promised “guaranteed” annual returns of 10.5%, 15% and up.

This is a knee jerk post. I just heard an ad for Schwab where they said they will sharpen your trading skills to learn how to trade brilliantly.
What immediately popped into my mind was I am not, nor do I want to be, a brilliant trader. I want to be a brilliant investor (hardly the case but I’m trying).
What about you? Do you aspire to be a brilliant trader or a brilliant investor? For I think they are totally different creatures.

Every now and then I read an article and think “Wow, I wish had written than”. I’m sure I’m not alone.
Recently I came across this article from Safal Niveshak, which is part tribue to Jonathan Clements, and part ode to simplictiy.
Money Is Simple. Why Do We Make It Complicated?

My favourite passage:
“A simple equity fund, a fixed-income option, and plain insurance are enough for most of us. But the industry thrives on multiplying choice because that’s how assets are gathered.

LARRY ELLISON, THE 81-YEAR-OLD cofounder of Oracle Corporation, recently became the world’s wealthiest person.
Oracle, a software company, isn’t nearly as large as its peers. So how did Ellison’s net worth manage to surpass that of Bill Gates, Jeff Bezos and the founders of other much larger companies?
The answer is simple: In the nearly 50 years since Oracle’s founding, Ellison has almost never sold a share of his company’s stock. According to an analysis by Smart Insider,

When I first started investing, my father-in-law, a longtime investor, gave me advice that echoes in my mind almost every day: “It is a business.”
At first, it sounded simple, maybe even boring. But the truth is, that advice has kept me from making a lot of mistakes. It runs contrary to the old adage, “Set it and forget it.” A business owner doesn’t forget their business. They know their numbers, track results, and adjust when circumstances change.

Christine Benz at Morningstar has published an update to the article. I think this is one of the better summaries on the internet.
It provides the steps and options available when determining an RMD. She lists the “key steps to take to improve your portfolio at the same time you’re meeting your obligations with the IRS.” She also discusses penalties for non-compliance and approaches to pruning and asset re-allocation.
Using Morningstar Style Box and sector exposure is suggested as a tool,

FOR MANY INVESTORS, talking about bonds is about as interesting as watching paint dry. They aren’t nearly as interesting as stocks. But if you have a portion of your portfolio allocated to bonds, or plan to, it’s a topic worth some discussion.
The bond market is actually much larger and much more diverse than the stock market. For most investors, though, there are just a few types of bonds to consider. We can examine each in turn:
Total Bond Market
Perhaps the most well known type of bond investment is a total-market fund.

THE MOST FAMOUS expression at Vanguard is to ‘stay the course.’ It’s meant to suggest that investors should remain steadfast and not sell stocks in a downturn.
This has proven great advice over the decades, but I’ve not been staying the course lately. I’ve been selling stock funds and buying bond funds this summer. Yet I think my actions would have the blessings of Vanguard founder Jack Bogle, who made the phrase ‘stay the course’ famous.