100 Level

Searching for the Strategic Asset Allocation Holy Grail

Establishing a strategic asset allocation (SAA) plan for a portfolio requires at least two major decisions.  1) What asset classes should be included in the portfolio.  2) What percentage of the total portfolio is allocated to each asset class.  Decision number two is the more difficult of the two.  Where do I come up with the various asset allocation plans found in the various … [Read More...]

What Does It Take To Retire?

Retirement Requirements What does it take in savings to live during retirement? Here is data that readers may find of interest as they think about portfolio development and eventual retirement. Assume a couple, nearing retirement, anticipate they will need $80,000 after taxes per year to live during their first year without employment. Between them they will receive a pension of $2,000 per … [Read More...]

300 Level

Sortino Ratio

Sortino Ratio: Calculation Steps Calculating the Sortino Ratio is not too difficult assuming you have historical data for the Internal Rate of Return (IRR) of the portfolio and the IRR for a benchmark. Here at ITA Wealth Management our primary benchmark is Vanguard's Total Market Index Fund, or VTSMX. Eventually we plan to move to the ITA Index, a customized benchmark for each portfolio. In … [Read More...]

Valuation Stocks: Looking for Undervalued Companies

This morning I planned to post a list of what I call "Valuation Stocks" or a small collection of companies that meet particular valuation standards.  Below is the list of stocks that passed the numerous screens.  Unfortunately, the program crashed before I was able to capture a screen shot of the screens.  When I downloaded a clean copy of the program, my screens were … [Read More...]

200 Level

The Asset Allocation Decision

What asset classes should be included in a portfolio?  Global diversification is highly recommended.  A well-diversified portfolio will contain, at a minimum, the following asset classes. … [Read More...]

Einstein Portfolio Review: 19 September 2011

Several portfolios are scheduled for review this week and the Einstein is first on the list.  Platinum members who follow ITA regularly know that I review the portfolios approximately every four to five weeks.  The first thing I do is look at the Dashboard, a worksheet housed within the all important TLH Spreadsheet.  The Dashboard lays out the asset classes and the percentage … [Read More...]

400 Level

Bullish Percent Indicators: 28 September 2012

The broad market decline showed up in a number of the indexes and sectors as Platinum readers will see in the following data tables.  To check these results, be sure to set the BPI graphs to calculate percentage changes, not the traditional setting. … [Read More...]

Momentum-Optimization Analysis of Equity Oriented Portfolio

Momentum-Optimization Analysis In the prior blog post I analyzed a sample portfolio using Quantext Portfolio Planner (QPP).  In this analysis I will use the momentum-optimizer spreadsheet to come up with the efficient frontier, a ranking of the securities, and the "decision maker," a Buy-Hold-Sell recommendation table.  We first take a look at the efficient frontier graph to see where the current … [Read More...]