100 Level

How To Protect Profits: Check Relative Strength Indicator

Protecting Profits After watching the market surge as it did this past week, how does one protect profits?  Answering this question is not easy and it will vary from investor to investor and even from account to account.  Below are possible answers to this vexing question. If you are a young investor with many years (10 or more) to go before retirement, do nothing. If you are … [Read More...]

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...]

300 Level

Rebalancing: How Important?

Below are rebalancing results that Bob Warasila recently updated.  As background for this study, we started with eight asset classes and invested $10,000 in each for a total of $80,000 for the portfolio.  The asset classes consisted of the "Big Six," REITs, and International Markets.  In 1989 I did not have easy access to data on commodities, international real estate, … [Read More...]

Dow 30 And The “Delta Factor”

Normally, I reserve the "Delta Factor" analysis for non-managed index ETFs.  Deviating from that pattern, below is a table for the Dow Jones Industrial 30 stocks.  ITA followers, who are also Mosaic investors, will find this list of interest.  Are there any mega-cap stocks that show promise of price growth over the next six to twelve months? When examining a table such as … [Read More...]

200 Level

Is There An Investment Style That Is Truly Passive?

We read a lot about active vs. passive investing, and mixed into that discussion is index investing.  About four months ago I wrote a series of articles on this very subject where I was rebutting an Internet article.  On this blog I track eleven portfolios that run the gamut from passive to mosaic to active.  To understand each, it helps to go back to Harold Evensky's … [Read More...]

Retirement Rule #4: Maximize Contributions to Employer Retirement Savings Plan

If you are fortunate and work for an employer who has any sort of matching savings plan, by all means take advantage of this offer and maximize your contribution.  To do otherwise is to leave good money on the table.  For example, assume your employer will match dollar for dollar any contribution you make to a saving plan up to 4% of your salary.  Further, assume you are earning $40,000 per year.  … [Read More...]

400 Level

Kenilworth Portfolio Review: 24 May 2012

It is hard to believe another month rolled around and it is once more time to update the Kenilworth Portfolio.  As one might expect, a number of the asset classes are under target as five of the critical eight (VTI, IWN, VEU, VWO, VNQ, RWX, DBC, & PCY) ETFs are priced under their respective 195-Day Exponential Moving Averages (EMAs).  Below is a slide of the Dashboard, one of the … [Read More...]

August “Delta Factor” Risk-Adjusted Portfolio For Interested Investors

What is a "Delta Factor" risk-adjusted portfolio and how is it constructed?  Rather than considering this as a potential portfolio for actual use, view it as an experimental portfolio.  Here are the steps I used to come up with this combination of ETFs. … [Read More...]