ITA Portfolio: A Well Diversified Mix of ETFs

Platinum members are encouraged to take a close look at the following list of ETFs that make up this portfolio.

The following material is not available for publication on Seeking Alpha or other Internet sites.  This material is reserved for Platinum members.

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Passive Management: A Tight Definition

Passive Management carries many meanings so I leave it to Harold Evensky to straighten us out as to what is meant by Passive Investing. In his excellent book, "Wealth Management" he provides this crisp definition. "Passive Management is the antithesis of active management. Its core philosophical tenet is that by brains, hard work, and technology, a manager cannot, over time and net of costs, beat the system; he can, however, beat most active managers. Passive management is often assumed to be the equivalent of index management.  It is not. Index Management is a special subset of passive management. A passive manager may make active trading decisions. His decisions, however, are based on information currently available to all investors not on an ability to read between the lines or predict future trends and events. Index management is passive management with the added constraint that the manager does not make active trading decisions."

What is the philosophy of ITA Wealth Management?

The portfolios managed on this site vary. Some are tilted toward index investing while most fall into the realm of passive investing as defined by Evensky. We definitely are not active managers in that we do not populate portfolios solely through the activity of picking individual stocks. The ideal is to set up a Strategic Asset Allocation plan for each portfolio and then stick with that plan for a long period.  As one ages it is assumed the asset allocation plan will adjust. The asset allocation plans do not vary all that much from one portfolio to the next. A core of index ETFs are selected to populate the different asset classes. There are times when we apply some Tactical Asset Allocation, which means we will over-weight or under-weight specific asset classes.


Photograph: The Arches National Park near Moab, Utah – USA

Seasonal Timing Strategy

As we approach the end of the month, review this blog entry I posted back on September 2nd.  Also run a search for Seasonal Timing Strategy to find more blog entries on this subject.

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