100 Level

Goofus vs. Gallant

As a follow up to The Golden Rule of Investing, I am bringing this post forward so new readers of ITA Wealth Management will not miss it. This post drives home the importance of investing frequently and early. As a small boy, my family subscribed to a magazine called “Children’s Activities.” Each issue contained a story of two characters, Goofus and Gallant. We all wanted to be … [Read More...]

Use of Leveraged ETFs

Leveraged ETFs are generally not a great investment for a long term investment since they do not necessarily behave as we might expect. One is a simple mathematical reason. Consider the 2 scenarios shown in the table below. The first scenario considers a stock that moves sideways by moving up 1% one day, down 1% the next and repeats this pattern. The second scenario is a bullish scenario where the … [Read More...]

300 Level

QPP Projections for the Bohr Portfolio

As promised, here is the Quantext Portfolio Planning analysis for the Bohr Portfolio.  Since I ran the analysis, shares of VEU and VWO were sold.  These ETFs plunged well below their 195-Day EMAs early this morning so I decided to protect gains and sell off, not all, but the majority of shares held in emerging markets and developed international markets.  This move is contrary to … [Read More...]

Beyond the Sortino Ratio

      This article was published two years ago, but most readers missed it.  That is why I am bringing it forward again, with a few edits. Frank Sortino begins Chapter 3 of his "The Sortino Framework..." book with this sentence. "This chapter begins with the development of the Sortino ratio and why I discarded it for the upside potential ratio and Desired … [Read More...]

200 Level

Bohr Portfolio Update: 21 June 2011

Bohr Portfolio Review This being the Summer Solstice, it seems prudent to review another portfolio.  This time it is the Bohr Portfolio, one of the better performing portfolios.  A limit order is in place to buy RWX to fill in the International REITs gap.  I also have orders set to see some of the bond/income generators as that asset class is being pulled back to 5%.  Several … [Read More...]

Rebalancing Portfolio: Blending Dashboard and Optimizer

Now that an optimizing tool is available, how does one rebalance a portfolio by combining the output of an optimizer with the Dashboard guidelines?  The larger topic is one of asset allocation so I will start with the following Dashboard that defines an asset allocation plan. Dashboard:  Assume the following Dashboard lays out the Strategic Asset Allocation plan for a portfolio.  Only pay … [Read More...]

400 Level

Reviewing Buy and Sell Decisions: Using VNQ as Example

Platinum members are aware of the five (Maxwell, Euclid, Madison, Kenilworth, and Gauss) ITA Risk Reduction (ITARR) portfolios.  In an effort to reduce risk there are times when the price of the ETF runs well ahead of its 195-Day Exponential Moving Average (EMA) and we want to protect profits.  How can we do this?  Here are some suggestions and an example.  Remember, this pertains to a situation … [Read More...]

Bonds: Are Any Worth Buying Based on “Delta Factor” Projections?

Bond Projections Look Dim Periodically a "Delta Factor" projection is posted for equities and bonds.  Today I am updating the projections for a wide array of bond ETFs and the outlook is not strong as one can see from the table below. … [Read More...]