100 Level

Constructing Your First Portfolio

Faced with the task of building a portfolio from scratch, what are the first steps?  Assume one saved a bit of money, read a few of the Top Ten Investment Books, and is convinced of the wisdom of index investing. Read the following questions and answer them as best you can.  Don't be fearful of making a mistake or feel these decisions cannot be reversed.  Not only can you change them, I … [Read More...]

Investing And The Marshmallow Test

Kids Marshmallow Test What do marshmallows have to do with investing?  Check out this set of video links and one sees the connection, particularly as it relates to The Golden Rule of Investing. The first video simply demonstrates the test - without any conclusions.  Children are placed in a room with one marshmallow in front of them.  If they can refrain from eating the … [Read More...]

300 Level

Momentum-Optimization Model (MOM) YouTube Presentations

Platinum members using the Momentum-Optimization Model (MOM) spreadsheet will find two help sessions at this address. http://www.youtube.com/user/Physlab Look for Momentum-Optimization and Momentum-Optimization Part 2.  Keep in mind that the resolution is not the greatest when viewing material on YouTube.  At least the Camtasia recordings are not as sharp as I prefer. Lowell   … [Read More...]

Newton Portfolio Review: 20 March 2012

It is again time to check in on the Newton Portfolio.  The following Dashboard shows the Strategic Asset Allocation plan for the Newton, and nearly all the asset classes are in balance.  I am not concerned about the under-target in international bonds as it is counter balanced by overweight in domestic bonds. Portfolio Performance:  Readers who have been following the Newton can … [Read More...]

200 Level

Swensen Portfolio Plus Dividend ETF VIG

As suggested by one reader, I removed the individual stocks from the Swensen-Six Portfolio and added VIG, a dividend oriented ETF.  Below is the Quantext Portfolio Planner (QPP) analysis, correlation matrix, and "Delta Factor" projections when using five years of historical data.  One big advantage of using VIG instead of several individual stocks is one of simplicity.  … [Read More...]

Asset Allocation: How Important?

  Exactly how important is the portfolio policy on portfolio return and how is it measured? Research papers from the late 1980s through the early 2000s tell us it is very important. That is, anywhere from 90% to 100% of the return of the portfolio is tied to portfolio policy.  Let me quickly insert that several studies are frequently misinterpreted.  While the papers focus on … [Read More...]

400 Level

Asset Allocation or Risk Parity

A Platinum member sent the following summary of an article and asked me to comment.  Note that my response is framed in the context of constructing portfolios through the use of a strategic asset allocation plan.  The Dashboard of the Curie Portfolio, posted this morning, is an example.  The second part is tied to future performance forecasts using software, Quantext Portfolio Planner (QPP).  Here … [Read More...]

Delta Factor: Three-Year Analysis Projects Grim Market Ahead

Yesterday I uploaded a "Delta Factor" data table using four years of historical data.  Today I am posting another table.  I added a few ETFs, but the main difference is that I am using three instead of four years of historical data.  Note the major difference in the projections for the future.  All the red is due to the analysis beginning with the market in steep … [Read More...]