100 Level

What Are The Disadvantages of Index Funds?

This morning I noticed a reader was searching for disadvantages associated with index funds, so I decided to do a little internet searching to find some of the drawbacks, if any.  As soon as one delves into this question, up pops the issue of passive vs. active investing.  Here are a few resources I located that deal with the question - are there disadvantages to using index funds?  I include … [Read More...]

Save Early

Photograph: Florence, Italy There is no better way to prepare for retirement than to save frequently and early.  The operative word is "early."  The Golden Rule of Investing is to "Save as Much as You Can as Early as You Can." William Bernstein, in his book, "Investor's Manifesto" puts it in harsh terms. "Each dollar you do not save at 25 will … [Read More...]

300 Level

Dividend Aristocrat Stocks

In contradiction to the many recent posts on the benefits of index and passive investing, I go against my own advice with the publication of this list of dividend aristocrat stocks.  This list might be of interest to Mosaic Investors who wish to add a few individual stocks to the core of their index oriented portfolio. The following information is not available for publication elsewhere. … [Read More...]

Benchmarking The Portfolio

Establishing an appropriate benchmark for a portfolio is essential if one is serious about investing.  Avoiding portfolio benchmarking is an act of self-deception, but all too common with the average investor.  Exactly what is the purpose of a benchmark and what are the requirements for a fair and reasonable benchmark.  Here is one definition of benchmarking. In the investing … [Read More...]

200 Level

Preparing for Einstein Update

One of the primary reasons for the advanced preparation for the Einstein update is to show readers a list of ETFs that provide global coverage while including enough low correlated ETFs for all types of markets.  This list of ETFs does not differ all that much from the 18 used in The Feynman Study.  Instead of many iShares I've substituted Vanguard ETFs as they have sufficient historical records … [Read More...]

Active vs. Passive Investing: Part 7

Section Seven of the "Active vs. Passive Investing" article is sumarized the following paragraph. "Some indexers never claim passive investing gives superior returns. They claim only that active investors do better than the benchmark some of the time, and worse some of the time, while passive investing gets rid of that risk by equaling the benchmark every time. They admit some … [Read More...]

400 Level

What ETFs to Include?

What ETFs should one include in a well-diversified portfolio?  After developing a Strategic Asset Allocation plan one needs to decide what ETFs to use as the portfolio building blocks.  Here are a few methods I use and suggest for Platinum members. If at all possible, use a commission free ETF.  Different discount brokers have their own commission free investments.  I use TD Ameritrade as my … [Read More...]

Risk Reduction Comments

Next week, February 6th, the Maxwell portfolio is up for ITA Risk Reduction examination.  When I checked this morning, before the market opened, all the ETFs used in the Maxwell were priced above their respective 195-Day EMAs.  That well could change by next week.  For example, the commodity, DBC, was only nine cents above its 195-Day EMA.  This raises an interesting … [Read More...]