100 Level

How To Use This Blog

  From time to time I write a help session, particularly for new Platinum members, on how to use this blog.  How to find information is essential, and there are two primary methods.  1) Use the Search tool.  This will bring up the latest information first.  For example, if you go to the Search option found in the right-hand sidebar and type in ITA Risk Reduction or ITARR, you will find … [Read More...]

Ten Biggest Investor Mistakes – # 5

ITA Wealth Management Mistake #5:  Investors pick individual stocks to build portfolios rather than use index funds. … [Read More...]

300 Level

Sortino Ratio Update

Investors using the TLH spreadsheet and in particular, the SR worksheet, will find this video/audio clip a refresher in updating the Sortino and Retirement ratios. One of the first changes to make in the calculation is to update the inflation rate. The latest data shows inflation moving from 1.1% to 1.2%. Readers can find this information on a site titled, U.S. Inflation Calculator. In the … [Read More...]

Dividend Aristocrats Ten Months Later

Nearly ten months ago a list of dividend oriented stocks were discussed on Seeking Alpha.  From the list of 42 Dividend Aristocrats, I honed in on those listed as a Buy.  Fifteen stocks made that elite list.  What kind of portfolio would an investor end up with when placed under the Quantext Portfolio Planner (QPP) microscope?  There are a few surprises as readers will see … [Read More...]

200 Level

Sample Portfolio For Thirty (30) Year Old Investor

The following portfolio was passed on to me by a Platinum member as an example of a Strategic Asset Allocation plan for a thirty year-old investor.  Nine ETFs are used in this portfolio and many of the investment securities are familiar to ITA readers.  In fact, all nine Exchange Traded Funds can be found in one or more portfolios with exception of RWO.  RWO is a global real estate … [Read More...]

Advantages to Mosaic Investing

It comes as no surprise to long standing Platinum members that most equity ETFs are highly correlated.  The basic ones we use to populate many of our portfolios show correlations of 80% or higher when analyzed using the Quantext Portfolio Planner (QPP) software.  To reduce portfolio volatility and increase the Diversification Metric (DM) we have several choices.  One common approach … [Read More...]

400 Level

Maxwell Portfolio Update: 5 July 2012

Examining the Maxwell asset allocation below, we note that developed international and emerging markets are still priced below their respective 195-Day Exponential Moving Averages (EMAs).  We are also below target in commodities as we are waiting on a price rebound.  Exposure to growth stocks is accomplished by holding shares in the blend column. … [Read More...]

Modified Sortino Ratio and Retirement Ratio: A Review of Uncertainty Measurements

  While the Sortino ratio was an improvement versus the old methods for measuring portfolio performance against a standard, Retirement Ratio sets even a high performance bar.  The old Sortino Ratio looked like the following. S = (P - B)/DR where S = Sortino Ratio P = IRR for Portfolio B = IRR for Benchmark (we now use the customized ITA Index in our calculations) DR = Downside risk … [Read More...]