100 Level

Requesting Yield To Exceed 3.0%

This morning I had an article published over on Seeking Alpha.  One reader requested what would happen if one of the constraints was to seek a yield of 3.0% or higher.  Below is the Optimization Analysis that meets this request when using the 16 ETF portfolio. The add link function does not seem to be working this morning so below is the URL to the SA … [Read More...]

VTI Switches Indices: Are You Concerned?

If I were to hazard a guess, most readers of ITA Wealth Management are not aware that VTI made a switch its underlying index benchmarks from MSCI to the CRSP indices (for US exposure) and FTSE indices (for international).  While this is of some concern, it will not significantly impact our portfolios as we do not invest only in the VTI index.  While the VTI will lose some exposure to mid- and … [Read More...]

300 Level

Manage Your Own Money

  Should you hire a money manager or do it yourself?  Consider the following assumptions and arguments. 1.  As the first given, the portfolio belongs to you, not the hired money manager.  This is an obvious, yet important point. 2.  Assume the advisor fees amount to 100 basis points or 1%.  Fees may be lower, but for ease of calculation, I will use the 1% … [Read More...]

Asset Allocation: Medium-High Risk Portfolio

This is the fourth portfolio in this series of relative risk allocation plans based on the data table found in this blog entry.  Note how the projected return is rising, but so is the projected uncertainty.  Return and Risk are highly correlated.  It is difficult to find a combinations of tickers that will increase the projected return while driving down the projected standard … [Read More...]

200 Level

Portfolio Performance Data for June 16, 2011

Asset Allocation Is Working The good news is that all eleven portfolio tracked using the TLH spreadsheet demonstrated the power of asset allocation by performing better than the VTSMX benchmark.  In almost every case, the Internal Rate of Return (IRR) for the portfolio also showed improvement when measured against the ITA Index. While the IRR for the portfolio and IRR for the ITA Index … [Read More...]

Updating the Basic Portfolio

Here is the latest data on a basic portfolio for investors about to launch a new portfolio.  The shares for this $100,000 portfolio present an example and each investor needs to make their own decisions.  Some portfolio tweaking will be suggested below when we take a look at the Buy-Hold-Sell Recommendation table. ETF Ranking:  While this is a basic list of ETFs, there will still be some … [Read More...]

400 Level

ITA Ratio Introduced

As I wrote in an earlier comment, I am moving from the Sortino ratio over to what I call the ITA ratio.  Let me go into detail as to why I am making the change.  I will explain how the new ITA ratio is calculated and how it will be programmed into later versions of the TLH spreadsheets.  It is not going to be all that difficult to make the change so stick with me. Before I launch … [Read More...]

Sortino Ratio: Revised Calculation

Platinum members likely picked up my reference on the new Sortino Ratio (SR) calculation in the comments section.  When you first log on to ITA Wealth Management, be sure to check for the latest comments or better still, sign up for a comments RSS.  What is changing with the SR calculation? … [Read More...]