100 Level

Key Ideas to Beginning Your Retirement Program

Keys to successful retirement investing. It All Starts With Saving Follow The Golden Rule of Investing.  Time is money. “Save as much as you can as early as you can.” Five critical investment decisions. The Management Decision Will you do it yourself or will you hire a professional money manager? The Active vs. Passive Decision Will it be stock, index funds, … [Read More...]

Investing 102: Strategic Asset Allocation Planning

Investing 102 - The SAA Plan As a followup to Investing 101, where does one go after reading some verbal guidelines.  Read on.  Laying out a Strategic Asset Allocation (SAA) plan is high on the to-do list.  What is a SAA plan? An example is shown below in the Dashboard worksheet extracted from the TLH spreadsheet.  The arguments for such a plan is explained in some … [Read More...]

300 Level

Euclid Portfolio Update: 27 August 2013

Yesterday I posted the Dashboard for the Euclid, one of three portfolios where all the detailed transactions are not available to Platinum members.  However, there is still a lot of useful information as I go through these updates.  This morning I will first look at the efficient frontier graph to see how well the Euclid assets are positioned with respect to the optimized portfolio recommended for … [Read More...]

My Portfolio Is Performing Great. Really? How Do You Know?

One comment I frequently hear when folks talk about investments is the following. "My portfolio is performing great." This statement conjures up questions I rarely ask as it tends to put the investor on the spot. Here are a few question that run through my mind. Performing great with respect to what? When was the portfolio launched? Is the portfolio return calculated by an acceptable … [Read More...]

200 Level

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...]

Retirement Requirements

Fidelity Investments came out with a study showing that retirees need approximately eight times their last salary level to be properly prepared for retirement.  For example, if one is earning $60,000 at age 65, $480,000 is the retirement base line.  Frankly, I think the number eight is too low.  There are a number of ways to determine what the retirement savings level should be and … [Read More...]

400 Level

ITA Ratio*: What Is It Telling Us?

The three classical portfolio performance measuring instruments, all rooted in the Capital Asset Pricing Model (CAPM) are: the Sharpe ratio, the Treynor ratio, and the Jensen's alpha.  The most popular of these performance instruments is the Sharpe ratio so let's take a closer look at it, particularly since it is similar to the Sortino ratio. Sharpe ratio (SR) = (P - R)/SD … [Read More...]

Portfolio Performance: ITA Ratio

When there is a lot of blog activity it is easy for the Portfolio Performance data table to be pushed off the screen and missed by readers unless they remain current with the new entries.  I'm bringing back the August 13th table with additional data.  Added to this table is the recently developed ITA ratio, another risk measurement that sets a high bar for portfolio … [Read More...]