100 Level

Delta Factor: What Is It?

Exactly what is the "Delta Factor?"  While I don't plan to reveal the exact algorithm, here are the basic ideas.   1.  A growth projection is estimated for the S&P 500 for the next year.  In most cases, I assume the S&P 500 will grow at an annualized rate of 7% over the next several months. 2.  The historical period is set for three to five … [Read More...]

Technical Analysis: Is the Market Overbought?

Examining the S & P 500 A number of weeks ago I mentioned the high percentage of individual stocks that were registering a Bull indication in the Point & Figure (PnF) graphs.  While the percentage tailed off a little last week, yesterday's market surge will likely increase the percentage once more.  Here is another important indicator of the current market condition and what … [Read More...]

300 Level

What Is A Good Sortino Ratio?

Seeking a Good Sortino Ratio A reader of ITA Wealth Management was seeking an answer to the question, what is a good Sortino Ratio?  The simple and quick answer is - anything above zero.  Check this definition of the SR.  While the equation is quite simple, the difficulty comes in calculating the denominator. SR = (P - T)/DR where P is the portfolio return T is a portfolio … [Read More...]

First Steps Toward Independent Portfolio Managment

Portfolio management is not equivalent building a house or overhauling a car engine.  It is not that hard, so don’t throw up your arms and say you cannot do it yourself.  With Internet access, it is much easier than it was twenty to twenty-five years ago.  Here are steps to setting up your own portfolio, managing the assets, and monitoring it on a yearly basis. 1) Open up an … [Read More...]

200 Level

Retirement Planning: A Conservative Approach

When planning for retirement, I always prepare with a conservative outlook in mind.  Even so, one will likely experience surprises, some positive and some negative.  The following portfolio is laid out with a 45 year-old in mind.  The investment vehicles are definitely tilted toward a dividend approach as I think that is where most of the portfolio return will come from over the … [Read More...]

Portfolio Performance: 27 May 2011

Portfolio Performances Updated All but one portfolio showed improvement vs. the VTSMX index.  Improvements were also evident for the Sortino and Retirement ratios.  Our asset allocation plans were working in full force this past week, a positive signal. Only the newest portfolio, the Franklin, lost ground and it is much too early to draw any conclusions.  As mentioned before, we … [Read More...]

400 Level

Point & Figure Graph Indicators

Point & Figure graphs are useful for identifying ETFs that may be a potential buy.  P & F charts are one of the metrics I use as a clue for potential buying (holding or selling) opportunities.  Below I show examples that illustrate the four basic conditions.  I am looking at the slope of the line, positive or negative, and whether or not there has been positive or negative … [Read More...]

Modifying the Faber Global Tactical Asset Allocation Model

As mentioned in the last blog, I highly recommend ITA readers take the time to download and read Mebane Faber's article, A Quantitative Approach to Tactical Asset Allocation. This blog entry explains a number of modifications or variations to the "Faber Model."  Faber uses five asset classes in his Global Tactical Asset Allocation model and they are as follows. U.S Equities or Stocks  -  … [Read More...]