100 Level

Investing: What Should I Do?

"Pay no attention to the advisors. The Markowitz-Sharpe theory says what to do." So writes Michael Edesess in his book, "The Big Investment Lie: What Your Investment Advisor Doesn't Want You to Know." Just what does the Markowitz-Sharpe theory tell investors to do. 1. Develop a plan for the portfolio. Determine the percentage between equities (index stock funds), … [Read More...]

Portfolio Construction

  With the advent of commission free ETFs, TDAmeritrade made it simpler to construct a portfolio.  Readers can watch the slow development of the Kenilworth Portfolio as an example.  Once you have selected the 10 to 15 asset classes, just "stair-step" the building process into a robust portfolio.  Here are my thought processes as to how to assemble a portfolio. … [Read More...]

300 Level

TLH Spreadsheets

Below are links to the seven spreadsheets available to Platinum members. … [Read More...]

Portfolio Monitoring – Kepler Portfolio – 6 June 2011

Kepler Portfolio Monitoring Asset Allocation is one of our guiding principles, and it is modeled properly in the Dashboard of the Kepler Portfolio.  To get to this point I did need to allocate 1% point to cash and reduce Large-Cap Blend by one percentage point.  I am still using a 25% threshold with this portfolio as the total portfolio value is modest.  Nevertheless, this is the … [Read More...]

200 Level

Portfolio Performance Update: 19 May 2012

Several weeks flitted by without a portfolio performance update.  Here is the latest information (see data table below) after what we might categorize as a miserable stock market week.  The ITA Risk Reduction model is working!  It is doing exactly what it was designed to do - reduce portfolio risk while increasing relative return.  However, it is still too early to gloat, but … [Read More...]

Simple Global Portfolio as IRA Risk Reduction Core

ITA Risk Reduction Portfolio Over the last few weeks, I've discussed a risk reducing portfolio consisting of seven ETFs.  They are: VTI, IWN, VEU, VWO, VNQ, RWX, and IGE.  While this combination provides global exposure, there are inherent risks.  While the projected return is a robust 9.7%, we take on a high degree of uncertainty to reach this return.  The projected … [Read More...]

400 Level

Retirement Planning: Stress Testing a Simple 5 ETF Portfolio

As mentioned in a recent post, stress testing the portfolio is one useful method of checking to see if there will be sufficient funds available to comfortably retire.  In this QPP analysis of a simple five ETF portfolio we will make some initial assumptions that will vary from investor to investor. Assume this investor is 50 and plans to retire at age 67.  The current portfolio is … [Read More...]

Asset Allocation: Why Select This Mix of ETFs?

Gauss is the newest portfolio launched (12/27/2011) here at ITA Wealth Management.  While the annualized performance is a respectable 25%, it still lags both the VTSMX and ITA Index benchmarks as it took time to populate all fifteen equity and bond asset classes.  The broad market was in a positive mood during the launch phase and as a result, the portfolio fell behind the … [Read More...]