100 Level

Second Grader’s Index Portfolio

Second Grader Portfolio About a year ago, Allan S. Roth, financial adviser, wrote a book I referenced in my last bog post. Roth helped his son, Kevin, set up this basic portfolio when Kevin was a second grader. I think he is now a fifth or sixth grader. The "second grader" portfolio is a three asset class portfolio or about as simple as it gets. The three asset classes are: U.S. … [Read More...]

MEDA Trust Update: 25 February 2011

MEDA Information "The poor stay poor not because they are lazy, but because they have no access to capital." - Milton Friedman It has been several weeks since I last gave an update as to what is happening with the ITA Wealth Management membership fees I am donating to MEDA Trust.  Check out the link if you want to know more about this organization. Over the last few years my … [Read More...]

300 Level

Using Treasuries to Reduce Risk

Compare the following portfolio (QPP analysis) with the risk reducing portfolio I suggested last week.  In the following portfolio, I stripped percentages off several equity and REIT ETFs and allocated those assets to a combination of TIP and TLT.  While the projected return is reduced, the projected standard deviation comes down at a faster rate giving one a higher Return/Uncertainty … [Read More...]

Preparation for Kepler Review

Next week the Kepler is up for review and the following information is in preparation for that update.  I want to know where the current portfolio is positioned with respect to an optimized portfolio and what additions or subtractions are necessary to push the current asset allocation toward the optimized asset allocation.  To examine past data on the Kepler, simply do a search for the portfolio.  … [Read More...]

200 Level

Asset Allocation: Breaking It Down

Launching a new portfolio requires a portfolio policy or an asset allocation plan.  There is a significant body of research on the importance of this decision.  However, some of the latest research by Ibbotson and Associates show this decision to be less important than it was thought to be twenty years ago.  Here are some of the steps I go through in thinking through what it means … [Read More...]

Ten Rules to Follow in Preparation for Retirement

Over the next few days I will lay out ten fundamental ideas or rules that will serve readers well as they prepare for retirement.  I know many of you are already well into retirement and have gone through this process while others are just beginning their investment journey.  For the veterans, you may pick up a few ideas and have others reinforced.  If you have words of wisdom for other readers, … [Read More...]

400 Level

ITARR Using Current Data

Platinum readers following the ITA Risk Reduction (ITARR) model will note that all key ETFs are currently flying beneath their 195-Day Exponential Moving Averages.  At the end of the month we will take a look at all positions to see what moves to make in early December.  Don't be surprised to see a rebound tomorrow. If new readers are unfamiliar with the ITARR model, search the term … [Read More...]

Seeking For Low Correlated ETFs

When the market shies away from equities and gravitates toward less volatile securities such as bonds and treasuries, we need access to those ETFs that have a low correlation with holdings such as VTI, VEU, and VWO.  What ETFs do we flee to when the equities market begins to wane.  If included in the ranking worksheet, we can easily identify those ETFs that have the strongest … [Read More...]