100 Level

The Search For The Perfect Portfolio

Yesterday I spent a considerable amount of time trying to come up with a portfolio where the projected return exceeds 8% when assuming the S&P 500 would grow at 7% per year.  Additional goals were to bring the projected risk to something under 13% and reach the 40% level for Diversification Metric.  Below is the screen shot for one of my efforts. Platinum membership available for … [Read More...]

Twelve ETF Portfolio: Moving From HYG to LQD

Here is the link to a basic 12-ETF portfolio.  In addition to examining the ETFs that make up the portfolio, take time to look at the Correlation Matrix. Over time I plan to sell some shares in HYG and move those funds over to LQD.  View this comparison link to see why I might be inclined to make the change.  If looking for income, HYG does have a higher yield than LQD.   … [Read More...]

300 Level

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...]

How Are Your Stocks Doing?

Using Morningstar and Yahoo-Finance to compare stocks and ETF performance. Here is an exercise that will prove informative to investors who construct portfolios using stocks. Follow these instructions. Make up a list of the stocks in your portfolio. Go to Morningstar and determine which asset class or style box each stock occupies. Type PAYX in the Quotes option and then scroll down the … [Read More...]

200 Level

ITA Asset Allocation Philosophy

Do you ever ask why ITA Wealth Management is such a strong advocate for developing an asset allocation (AA) plan?  While academic studies of the late 1980s placed more importance on asset allocation than more recent studies, there still does not appear to be any portfolio models that outshine broad diversification through asset allocation. Further, complete and in depth studies as to the … [Read More...]

Portfolio Performance: October 21, 2011

Portfolio Performance Data Table Finally - this was a better week for the broad equity markets.  Once more, large-cap U.S. stocks outperformed the international equities, but overall, most of the portfolios tracked here at ITA Wealth Management moved ahead. Platinum membership is available for $5.00 per month.  Check out all that is available. … [Read More...]

400 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...]

“Delta Factor” for International Equities

International ETFs Analyzed Seeking Alpha published this article on MIST, the new group of international markets that are poised to perform well according to the article.  What are the projections based on a "Delta Factor" analysis?  The results are shown in the following table. … [Read More...]