"New normal" is a term coined by the brain trust at the giant bond fund PIMCO. Bill Gross is frequently given credit for coming up with this term as a way to underscore a change in the expected growth of our economy and investment markets. "New Normal" is another way of stating that growth is slowing so prepare for it. One way we prepare is to reset the default setting in the Quantext Portfolio Planning (QPP) software from 8.3% down to 7%, and that may be too high.
In response to the "New Normal" idea, Bob Warasila built the following portfolio as a response to anticipated slower growth. Bob has mentioned many times on ITA Wealth Management that this NN portfolio is defensive in nature. When the market booms, the NN portfolio falls behind the benchmarks, and conversely, when the market declines, the NN portfolio gains ground on the VTSMX benchmark. In the following screenshots Platinum members will see a three- and five-year QPP analysis of the NN portfolio. These are the latest tickers and percentages for the NN portfolio.
This material is not available for printing elsewhere on the Internet. Permission to publish this data granted by Bob Warasila.