100 Level

Can You Beat The Market?

As an investor, ask yourself the following questions. Am I selecting individual stocks as the primary building blocks for my portfolio? Do I use actively managed mutual funds as my investing vehicles? Do I even know what active management means? Have I turned my investments over to an investment manager? What are the total management fees charged by the investment manager? If the … [Read More...]

Year End Portfolio Hints

This year, the last business day arrives on December 31st and that gives us a chance to balance our portfolios to the nearest penny. At least TDAmeritrade clients have a high probability of receive access to their statements before the market opens the following week. Go through your portfolio Monday and see if you have any tax losses you might want to capture in 2010. If the loss is small, I … [Read More...]

300 Level

ETF Evaluations In Preparation for Euclid Risk Reduction Analysis

At the close of the market tomorrow (1/12/2012) I will examine the relative price of each ETF used in Euclid and compare it with its 195-Day EMA.  For example, in the slide shot below the price of VTI is well above its 195-Day EMA.  The ITA Risk Reduction model calls for holding a full position in VTI.  Checking the Euclid moments ago, Large-Cap Blend (VTI) is slightly over target … [Read More...]

Stock Valuation Screen

Screening for Deep Value Stocks Using the latest database of information, I ran another "valuation" screen on over 9,800 stocks and came up with only three that passed the test.  Below are both the screen criteria and the resulting companies. Platinum membership is available for $5.00 per month. … [Read More...]

200 Level

Keeping Portfolios Simple

Three Sample Portfolios Complicated portfolios discourage investors and that is why I am attempting to simplify the portfolios tracked here at ITA Wealth Management.  There are many examples of possible portfolios in the literature, particularly in books by Faber-Richardson, Swensen, and Bernstein.  Let's start with one of the simple portfolios laid out by David Swensen. While Swensen does not … [Read More...]

Risk Adjusted vs. Capitalization Asset Allocation Portfolio Construction

Is it better to construct a portfolio based on allocating assets around capitalization divisions or is one better off using a risk adjusted platform?  The following two screen shots show the details of these two approaches to portfolio construction.  In each case I am using ten ETFs that provide worldwide diversity.  Four years of historical data goes into the following Quantext … [Read More...]

400 Level

Bullish Percent Indicators: Further Market Weakness Beginning To Appear

Bullish Percent Indicators (BPI) are Point and Figure graphs we use to view overall market movements from week to week.  Not only do these indicators provide general market movements based on percentage changes, but the actual values tell us if the market is under valued, fairly valued, or over valued.  The bull market is cooling off based on BPI values and this is why investors need to be paying … [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...]