Yesterday’s blog entry reported on an e-mail that I sent to academic researcher Wade Pfau on February 21, 2011. He responded on February 24, 2011.
He said: “Now that I am accounting for risk, I am even more amazed by how well Valuation-Informed Indexing works. I’m so confused by why Fisher and Statman didn’t consider risk in their idiot switching tests. VII is much less risky by pretty much any standard I consider. I must wonder… did I make a mistake somewhere? Why haven’t academics already published research about this?”
Wade provided a link to a Bogleheads Forum thread he started:
He also set forth a link to an exchange he had with Drip Guy, one of the lead Goons:
He said: “He never responded to me. But have you ever heard him express before that he essentially has a backup plan for the 4% rule, and that is to start cutting withdrawals should the need arise?”