A quick update to my derisive post about the TMF-branded mutual fund: we have a little over two months in the bag, which in the daily-NAV world is enough for a back-of-the-envelope performance analysis versus the mooted competition, Vanguard's Total World Stock ETF (VT) [more]
This is hilarious. Abso-freaking-lutely sidesplitting. I'll put dollars to donuts you do better long-term in Vanguard's VT ETF with its 25 bps in fees. 110 basis points a year is a lot of ground to make up. These tasty TMF-Brand Frosted Flakes either will fail to perform, period, or will succeed only by taking on more risk than the index. [more]
Anyone who read my blog posts back when knows I believe CAPS's performance-measaurement metrics fundamentally to be broken. (Read back in the blog.) The question here is, why: why would folks smart enough to design such a fun little game use performance measures that so completely elide risk? There's a whole magazine named after risk. We're not talking little omissions.
Stock goes from 160 to 80. Close short. Reshort. Repeat at 40, 20, 10, 5, 2.5 and 1.25. Stock reverse splits 1 for 40. Stock goes to 25. Close, reshort. Repeat at 12.5, 6.25, and 3.125.
Stock gets delisted.
You get 500 points from an underperform call.