100 Level

Index Investing Slow To Catch On

Is there a logical reason why 60% of institutions and 85% of individual investors avoiding index investing? The reasons below come from an article, "The Best Investment Advice You'll Never Get." "A big reason, according to Geddes, is that putting investors into index funds is simply not in the interest of the industry that sells securities. “They just won’t accept … [Read More...]

Commodity Holdings: DBC vs. DJP

Faber and Richardson recommend using DBC as the commodity holding in their five and ten ETF portfolios.  I favor DJP, an Exchange Traded Notes (ETN) as the commodity placeholder.  Readers can look up the difference between and ETF and ETN on the Internet.  How do these two commodity holdings compare over a time duration of interest.  Since commodities have a rather short … [Read More...]

300 Level

Second Run of Suggested Portfolio

I mistakenly dropped two securities from a recently submitted portfolio.  Here is an update of that analysis.  Once more, I approximated the percentage of shares held in the portfolio. Efficient Frontier:  The current portfolio lies quite close to the optimized portfolio.  This suggests few changes are needed.  Nevertheless, recommendations are coming in the third screenshot. Security … [Read More...]

Newton Portfolio Review: September 20

Shares of ALD, LLY, ELD, VEU, and RWX were added to the Newton during the month of September.  The purchases bring some of the under target asset classes just a little closer to their target percentages.  Below is the current asset allocation plan for the Newton. … [Read More...]

200 Level

Sample Portfolio For The Mosaic Investor

Investors who use a few individual stock will be interested in the following portfolio suggested by a reader.  By Mosaic, I mean an investor who uses an array of index ETFs (or index funds) and then sprinkles in some individual stocks. QPP Analysis of Suggested Portfolio:  In this analysis the S&P 500 is assumed to grow at an annual rate of 7.0% so this portfolio is projected to outperform … [Read More...]

Newton Portfolio Update: 7 February 2012

Once more it is time to update or review the Newton Portfolio.  Shares of RWX, VWO, VOT, and PCY were recently added to bring various asset classes into balance.  Most of the February dividends are included in this review.  As usual, the first order of business in any update is to go to the broker account and make sure all the latest transactions are recorded.  I've done … [Read More...]

400 Level

Retirement Ratio – What Is It?

Understanding the Retirement Ratio In each Portfolio Performance data table readers see the column labeled, RR, or Retirement Ratio. Just what is this ratio and how is it calculated? To understand the Retirement Ratio first requires an understanding of the Sortino Ratio (SR) as the Retirement Ratio is a modification of the SR. Mathematically, the Sortino Ratio is expressed as follows. SR = (P - … [Read More...]

Using the Ranking Spreadsheet as a Timing Tool

This Post is in response to a comment from a member concerning whether the Ranking Sheet (and Momentum Percentage) might be useful as a general market timing tool for different markets (e.g. US Equities, non US Equities). As suggested by the member, I've setup the spreadsheet with only 4 ETFs, US Equities (VTI), Developed Markets ex-US (EFA), Emerging Markets ex US (VWO) and (the inevitable) … [Read More...]