100 Level

Downsides to ETFs

  ETF Negatives   There are a few, but not many, negatives to working with ETFs. A broker is required to purchase and sell ETFs.  I use TDAmeritrade and it costs me $7.00 to purchase and $7.00 to sell ETFs.  Now 101 ETFs are commission free with TDA. Therefore I generally deal in blocks of 100 shares or more.  This is done to keep commissions to a low percentage of … [Read More...]

Benchmarking a Portfolio: Essential to Portfolio Management

Waterford, Virginia ITA Wealth Management readers know I am passionate about portfolio benchmarking and portfolio risk analysis.  To my knowledge, there is no better software program for the small investor than the TLH Spreadsheet, provided to all Platinum members.  We use two primary benchmarks in this spreadsheet, although four are available.  One is Vanguard's Total Stock … [Read More...]

300 Level

The Art and Science of Portfolio Construction

Basic investment principles require long-term portfolios exhibit the following characteristics. 1.  Equity orientation. Equity orientation includes high-expected return ETFs such as VTI, IWN, VTV, VOE, VOT, VBR, VBK, etc. 2.  Diversification over the entire world market. International exposure is possible through ETFs such as VEU, EFA, VWO, EPP, etc. This blog post is not … [Read More...]

QPP View of Twenty ETFs

Here is a QPP view of the twenty ETFs mentioned in the prior blog post.  I'll likely optimize these ETFs later.   … [Read More...]

200 Level

Asset Allocation: How Important Today?

Asset Allocation Due to a recent Ibbotson study (Unfortunately, this article now requires one to register.) asset allocation is not the investment elixir today it was thought to be in the late 1980s and 1990s. Nevertheless, it remains the best method for constructing portfolios if our goal is to outperform a broad market benchmark index such as the VTSMX while reducing portfolio risk. Readers of … [Read More...]

Example Asset Allocation Plan

Photograph:  San Jose de Gracia Catholic Church - Built in 1760 - Las Trampas, New Mexico Are you looking for an example of a "Holy Grail" Strategic Asset Allocation plan?  Below is such an example.  Actually, it is the asset allocation plan of the Einstein Portfolio.  While I have only been tracking the Einstein Portfolio using the TLH Spreadsheet since 6/30/2008, … [Read More...]

400 Level

How To Handle Emerging Markets (VWO) Today

If a portfolio were up for review today, how would I handle the ETF we use for our emerging markets (VWO) investment?  The first move is to check several indicators as listed below. Platinum membership is available for $5.00 per month.  … [Read More...]

Risk Parity Analysis of Modified “Ivy-10″ Portfolio

When investors populate their portfolios with stocks or equity ETFs, it is easy to forget just how exposed the portfolio is to risk.  The following analysis is a reminder of the high risks we take when constructing portfolios.  To know a little more about Risk Parity, check out this link. … [Read More...]