100 Level

Muling

Photograph: Fort in Savannah, GA Have you ever heard of "Muling?"  It was new term to me until this week when a former student sent me this URL.  Check it out. … [Read More...]

Investment Book: Short Yet Essential

The Investment Answer Daniel C. Goldie and Gordon S. Murray have written a concise investment book of 80 pages that covers all the basic. What is unusual is that in this little book, Murray advocates a different (passive) investing style than the one he used to build his 25-year career. Here are a few references touting this book. Daily Finance PR Newswire Business … [Read More...]

300 Level

Schrodinger Portfolio Update

Schrodinger Review With so many portfolios carrying several asset classes that are out of balance, it is nice to see one where all the equity and bond assets are within the 25% threshold range.  Such is the case with the Schrodinger, as one can see in the following screen shot.  We always expect to see the Money Market out of balance if the allocation is set to zero. The Schrodinger … [Read More...]

Passive vs. Active Investing

Why do large endowment funds use a passive investment strategy? Is it due to fund size and their portfolios are so large they mirror the market? Again, quoting from my “Active vs. Passive” paper, we have the following. “An estimated 40% to 50% of all institutional monies are in index or passive portfolios while only 3% to 4% of retail investors make use of passive strategies. … [Read More...]

200 Level

Asset Allocation: How Important Today?

Asset Allocation Due to a recent Ibbotson study (Unfortunately, this article now requires one to register.) asset allocation is not the investment elixir today it was thought to be in the late 1980s and 1990s. Nevertheless, it remains the best method for constructing portfolios if the goal is to outperform a broad market benchmark index such as the VTSMX or ITA Index* while reducing portfolio … [Read More...]

Sample Retirement Portfolio

The following portfolio is one suggested by a Platinum member.  The first screenshot shows the original asset allocation.  For reference, the assumed growth for the S&P 500 is 7% annually.  Should I ever forget to include this assumption, readers can check by looking at the bottom right section (gray background) to see the projected return and projected standard deviation.  The time frame is … [Read More...]

400 Level

Bullish Percent Indicators Update: 7 September 2012

Despite the strong market today, several sectors and one index handed the ball over to the defense.  Check the tables to see which areas of the market moved from X's in the right-hand column over to O's. … [Read More...]

Faber – Richardson “Ivy Model” Review

In response to a recent question, allow me to review the Faber - Richardson model as described in their book, "The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets."  The ITA Risk Reduction model focuses on the "Avoid Bear Markets" part of the Faber book. Here are the basic Faber - Richardson rules one can use with any portfolio.  Investors … [Read More...]