100 Level

Please Turn Off CNBC!

CNBC is only a place holder for all types to Wall Street media hype.  Eschew information that is designed to keep you unsettled, nervous, and makes you feel as if you are doing something wrong and change is necessary.  Too much investment information is not necessarily a good thing for portfolio management.  If financial news sources had your best interests in mind, you would find them so boring … [Read More...]

The Condition of Bonds Using Delta Factor

What is the current condition of bond ETFs and should they be part of the portfolio?  To examine this question one method of analysis is to apply the Delta Factor.  When I run a reversion-to-the-mean analysis on bonds, I use AGG as the reference or standard.  For equity ETFs I use the VTSMX total stock index fund.  In the following table each bond ETF is compared with the … [Read More...]

300 Level

Einstein Portfolio Review

Since the last update 33 days ago, shares of VWO, EMB, DBC, and GTU were sold and shares of VOE and VTI were purchased.  The Hoadley Optimizer recommended eliminating EMB, DBC, and GTU and we still need more shares of VOE in the portfolio. Einstein Dashboard:  Due to some action this past month, this Dashboard looks a little bloody.  I'll be readjusting the Strategic Asset Allocation plan to … [Read More...]

Kenilworth Portfolio Update: 24 October 2012

The one change I made since posting the following screen shots was to sell shares of DBC, the commodities holding.  The current price of DBC is below its 195-Day EMA and since this is one of the ITA Risk Reduction (ITARR) model portfolios, a sell was necessary.  I held 25 shares of DBC and I sold 20 shares.  The remaining 5 shares were left in the portfolio so I will have an ongoing calculation … [Read More...]

200 Level

Steady As She Goes With The Schrodinger

Investors looking for a well-diversified no-nonsense portfolio need look no further than the Schrodinger Portfolio.  This passively operated portfolio was launched in late 2000 so it has been operational during the "lost decade."  The Sortino Ratio for the Schrodinger is a very high 10.4 and the yield is a respectable 2.3%.  Readers will note the strong tilt toward … [Read More...]

Optimizing The Swensen Six Portfolio

The prior blog post shows what happens when no constraints are placed on an optimized portfolio.  To follow up on the Swensen Six post, assume we begin with the asset allocation plan recommended by Swensen and then optimize the six ETFs using reasonable constraints.  The following efficient frontier graph show the Swensen allocation (diamond dot) falling well short of the optimized portfolio (red … [Read More...]

400 Level

Rule #6 of Investing

Diversify is Rule #6. Diversity reduces adversity. Simply put, spread your money out over several asset classes. For small accounts, one should at the very least consider stocks (ETF equity), bonds, and an international fund. For larger accounts, broaden into REITs, commodities, and emerging markets using ETFs or index funds. For the very largest of portfolios, break the asset classes into value, … [Read More...]

Launching a New Portfolio and Initializing ITA Index

Platinum readers know about the funding of the new ITA-RR portfolio. Since tomorrow is the last business day of the month (December) I will take a careful look at the price points for VTI, IWN, VEU, VWO, VNQ, RWX, and IGE and compare them with their respective 195-Day EMAs.  If nothing were to change tomorrow, on January 3, 2012, I will take out a full position in VTI, IWN, and VNQ.  … [Read More...]