100 Level

High Yield Retirement Portfolio

A Platinum member submitted the following portfolio for analysis.  The portfolio is designed to throw off income for a retiree and as you can see, the historical yield is a very high 4.6% so the portfolio is meeting that goal.  Take note that the portfolio outperformed the S&P 500 and did it with much lower risk. The projected return over the next six to twelve months is 7.6% or very close … [Read More...]

Mosaic Investor

Mosaic Investing: A third investing style, and one not frequently mentioned in academic literature, is a combination of passive, index, and active management. I call it the Mosaic investing approach. Mosaic investors will fit somewhere along the broad continuum of all investing styles. A Mosaic investor may construct a portfolio around a core of index funds with a particular asset allocation tilt. … [Read More...]

300 Level

QPP Analysis of Faber Ivy Ten Portfolio

Yesterday I analyzed the Faber-Richardson Five portfolio found in The Ivy Portfolio.  In this post, Platinum members will find the QPP analysis of the Faber-Rickardson Ten.  I used the same five-year time frame so readers can compare the two results.  Improvements and negatives come with this expanded portfolio. While the projected return moves up to 8.2%, we give up risk as the … [Read More...]

“New Normal” Portfolio With Risk Reduction Allocation Plan

Following up on the risk adjusted Ten ETF Portfolio analyzed yesterday, what does the "New Normal" group of stocks and ETFs look like when the same risk management algorithm is applied.  In this analysis I was able to stretch the historical period out over five-years.  The percentage allocated to the different stocks and ETFs look reasonable when the low variance BND ETF is not … [Read More...]

200 Level

Portfolio Performance – 1 October 2010

TDAmeritrade came out with the September statements this afternoon so I was able to update many of the portfolios in greater detail that expected. In nearly every case, we made progress either by gaining on the benchmarks or reducing portfolio risk. Only in the case of the Schrodinger Portfolio, where we switched to the ITA Index benchmark for our SR and RR calculations, did we see significant … [Read More...]

Sixteen Asset Classes: The Basic Portfolio

More Asset Classes Are Not Enough TLH Spreadsheet users are familiar with the sixteen (cash is excluded) asset classes used with most of the larger ITA Wealth Management portfolios.  Below is what I call the Basic Portfolio as standard ETFs are used to populate the different asset classes. Despite all the asset classes being populated with nearly equal percentages, there is something … [Read More...]

400 Level

Is Risk Receiving Too Much Attention?

Are we paying too much attention to risk or portfolio uncertainty?  The answer to that question may not be as straight forward as readers might expect.  Each time ITA Wealth Management readers see a Quantext Portfolio Planner (QPP) analysis, projected portfolio uncertainty is one of the five critical metrics or outcomes.  Since projected return and projected standard deviation (SD) … [Read More...]

Retirement Portfolio: Part Three

Part three of this series of retirement preparations shows how one might optimize the array of ETFs presented in the earlier two blog posts.  In the following screen shot I set up a number of constraints and one was to hold the Diversification Metric to the 40% standard.  I also included BND, Vanguard's Total Bond ETF in the mix of investments.  Even by forcing none of the bonds to hold more than … [Read More...]