 |
Vanguard ETF: |  |
7.4%* |
|
Diversified Core: | |
8.1%* |
|
Six Core Asset ETFs: | |
7.3%* |
Articles on CSJ
- ETF Based Bond Trend Indicators For The Week of November 15
11/15/2010
Fixed income is a key asset class categories in portfolio building. The main risks are represented by long/intermediate/short maturity bonds and high yield (junk), credit bonds. These indices provide important insight into debt market conditions that are key to asset allocation strategies. MyPlanIQ tracks detailed weekly bond trend movement. We use ETFs that represent the bond classes. For more information, please visit MyPlanIQ 360 Degree Market View.
The Federal Reserve's low rate policy has driven down bond yields to historical low. The Fed's QE2 announced last week showed Fed's committed action to maintain a long period of low rates to stimulate the economy. Investors should take a note on the 20+ year treasury bonds that has had trouble recently: reflecting a belief that eventually, Fed's action will result in much higher inflation. International fixed income bonds are rising because of the US dollar weakness.
Description
Symbol
15-Nov Trend Score
Direction
8-Nov Trend Score
High Yield
JNK
5%
v
8%
Emerging Mkt Bonds
PCY
5%
v
9%
International Inflation Protected
WIP
4%
v
7%
Intermediate Treasury
IEF
3%
v
5%
International Treasury
BWX
3%
v
6%
Long Term Credit
LQD
3%
v
5%
Intermediate Term Credit
CIU
3%
v
4%
Inflation Protected
TIP
2%
v
4%
10-20Year Treasury
TLH
2%
v
4%
MBS Bond
MBB
1%
v
2%
US Total Bond
BND
1%
v
2%
Short Term Credit
CSJ
1%
v
1%
Short Term Treasury
SHY
0%
v
1%
Treasury Bills
SHV
0%
v
0%
New York Muni
NYF
0%
v
2%
20+ Year Treasury
TLT
-1%
v
1%
National Muni
MUB
-1%
v
2%
California Muni
CMF
-1%
v
1%
Top Five Indicators
There is weakness across the board without any indication of what is
Bottom Five Indicators
The worst performers are treasury bonds, especially in the 20+ year ones. Again, it is telling that investors definitely have a negative outlook in a long term for fixed income. Other bottom performers all have less risky nature, reflecting investors' chase for high yields and increasing risk appetite.
In conclusion, bonds in general continue to do well. Investors should keep an eye on such euphoria outlook and watch carefully on the possible turn that eventually will happen: exceptional low rates have to come with a price and can only sustain for so long.labels:investment,
Symbols:AGG,BND,SHV,SHY,IEF,TLH,TLT,TIP,WIP,HYG,JNK,PHB,CSJ,CIU,LQD,BWX,CMF,NYF,MUB,MBB,PCY,EMB,
- Retirement Income Portfolio Building Using ETFs and Asset Allocation Strategies
11/12/2010
Building a steady and safe income producing portfolio is paramount to retirees. High yield stocks, preferred stocks, convertibles and bonds are the basic building blocks for such portfolios. Research results indicate that blue chip stocks with high dividends, unlike highly volatile and low dividend or no dividend stocks (such as many high tech stocks and small company stocks), have produced comparable or even slightly higher returns with less risk in long term.
In this article, we present a high income investment plan (Retirement Income ETFs) that is based on asset allocation strategies. Both MyPlanIQ Strategic Asset Allocation (SAA) and Tactical Asset Allocation (TAA) strategies are used to construct model portfolios.
This plan is designed for income producing purpose: high dividend (yield) stock ETFs are chosen for both US stocks and international stocks asset classes. We have decided to use general emerging market stocks ETFs (EEM or VWO) instead of some thinly traded high dividend emerging market stock ETFs. This situation will be changed once the high yield emerging market stock ETFs become more liquid and tradable.
The plan uses 34 ETFs that represent the following five key asset classes:
U.S. stocks: VIG, DVY, SDY, FVD, VYM, PEY, PFF
International stocks: PID, IDV
Emerging market stocks: EEM, VWO
Real Estate Investment Trusts (REITs): IYR, ICF, VNQ, RWX
Fixed Income:- US Fixed Income: HYG, LQD, VCLT, CIU, CORP, CSJ, VCSH, IEI, IEF, SHY, TLT, TIP, MBB, MUB, SHM
- International Fixed Income: BWX, EMB, PCY, WIP
Notice that preferred stocks PFF is classified under U.S. stocks.
We compared the back tested performances of the SAA and TAA moderate model portfolios with the corresponding SIB (Simpler Is Better) five core asset ETF portfolios. As of 11/9/2010, the performance is:Performance table (as of Nov 10, 2010)
Portfolio Name 1Yr AR 1Yr Sharpe 3Yr AR 3Yr Sharpe 5Yr AR 5Yr Sharpe Retirement Income ETFs Tactical Asset Allocation Moderate 16% 105% 8% 57% 12% 84% Retirement Income ETFs Strategic Asset Allocation Moderate 14% 108% 1% 5% 6% 28% Five Core Asset Index ETF Funds Tactical Asset Allocation Moderate 15% 105% 8% 57% 16% 106% Five Core Asset Index ETF Funds Strategic Asset Allocation Moderate 19% 146% 4% 16% 10% 42% From the above chart, one can see that since the portfolio inception (12/31/2000),the Retirement Income ETFs Strategic Asset Allocation Moderate has outperformed its corresponding Five Core Asset Index ETF Funds Strategic Asset Allocation Moderate while in the meantime, the Retirement Income ETFs Tactical Asset Allocation Moderate has outperformed its corresponding Five Core Asset Index ETF Funds Tactical Asset Allocation Moderate. In fact, in the past ten years, the Retirement Income portfolios had lower standard deviation than the Five Core SIB. Please visit the corresponding portfolios for more detailed performance information.
Currently, the SAA Moderate Portfolio has the following holdings and yields:Asset ETFs Allocation Yield REAL ESTATE ICF (iShares Cohen & Steers Realty Majors) 11.96% 2.88% FIXED INCOME LQD (iShares iBoxx $ Invest Grade Corp Bond) 18.40% 4.80% Emerging Market VWO (Vanguard Emerging Markets Stock ETF) 13.31% 1.20% US EQUITY DVY (iShares Dow Jones Select Dividend Index) 5.92% 3.53% US EQUITY PEY (PowerShares HighYield Dividend Achievers) 4.87% 4.28% INTERNATIONAL EQUITY IDV (iShares Dow Jones Intl Select Div Idx) 16.50% 4.25% High Yield Bond HYG (iShares iBoxx $ High Yield Corporate Bd) 16.47% 8.40% INTERNATIONAL BONDS BWX (SPDR Lehman Intl Treasury Bond) 12.57% 0.70% Total Yield 4% Compared with current sub-zero interests in a cash account, the above portfolio's yield is very attractive.
In conclusions, using effective asset allocation strategies (especially the tactical asset allocation strategy), one can build an income producing portfolio that is less risky and achieve higher returns. Retirees or anyone who needs supplemental income can benefit from learning more on these investment plans.labels:investment,
Symbols:VIG,DVY,SDY,FVD,VYM,PEY,PFF,SPY,IWM,PID,IDV,EFA,VEU,EEM,VWO,IYR,ICF,VNQ,RWX,HYG,LQD,VCLT,CIU,CORP,CSJ,VCSH,IEI,IEF,SHY,TLT,TIP,MBB,MUB,SHM,AGG,BND,BWX,EMB,PCY,WIP,
- ETFs Provide Insight Into U.S. Sectors' Performance
11/12/2010
US sectors provide insight into the parts of the US economy that are flourishing or floundering. We are tracking the ETFs that represent ten different financial sectors.
More details are available on the MyPlanIQ website.
Description
Symbol
8-Nov Trend Score
Direction
Consumer Discretionary
(XLY)
14%
Week 1
Materials
(XLB)
13%
Week 1
Telecom
(IYZ)
13%
Week 1
Technology
(XLK)
12%
Week 1
Industries
(XLI)
11%
Week 1
Energy
(XLE)
10%
Week 1
Consumer Staples
(XLP)
7%
Week 1
Utilities
(XLU)
7%
Week 1
Financial
(XLF)
6%
Week 1
Healthcare
(XLV)
6%
Week 1
click to enlarge
We are entering the holiday period with the QE2 wind at our backs. This is going to increase consumer confidence and consumer spending.
The materials and commodity sectors have jumped due to a weak dollar, which the QE2 program exacerbates. It is also likely to stimulate demand for materials further pushing up the price.
The telecom sector includes wireless phone providers and they will likely do well through the holiday period with the increasing success of smart phones.
With the Republican victory in the House, some analysts are talking a lot these days about utilities stocks -- the reason being that the sector may benefit from the higher likelihood that the 15% tax rate on dividends will be extended.
The financial sector is still recovering from its meltdown and will continue to be under pressure with continuing concerns with mortgage stability and general fragility.
Healthcare's overall performance has been under pressure in this economic environment. Despite a substantial portion of their products being required for survival, sales remain sluggish. As a result, a wave of consolidation has gobbled up mid-cap companies with new products.
Some of these sectors will peak in the holiday season while others will settle over a longer time period as the political and economic climate evolves.
labels:investment,
Symbols:AGG,BND,CIU,CSJ,DBA,DBC,EEM,EFA,GSG,HYG,ICF,IEF,IWM,IYR,IYZ,JNK,LQD,MBB,MDY,MUB,PHB,QQQQ,SHV,SHY,SPY,TLT,USO,VEU,VNQ,VWO,XLB,XLE,XLF,XLI,XLK,XLP,XLU,XLV,XLY,
- International ETF's Give Insight on Global Economies
11/10/2010
While the world is becoming more connected, local conditions prevail resulting in different economic returns. MyPlanIQ tracks detailed weekly country economic trend movement. We use ETFs that represent each geographic region and present the results here.
More details are available on the MyPlanIQ website.
The largest industrial nations are meeting in Seoul this week and one of the topics on the agenda is rebalancing global growth.Country Symbol 8-Nov Trend Score Direction India INP 57% Week 1 South Africa EZA 47% Week 1 Singapore EWS 43% Week 1 Hong Kong EWH 42% Week 1 Mexico EWW 41% Week 1 Malaysia EWM 40% Week 1 South Korea EWY 37% Week 1 Russia RSX 34% Week 1 Australia EWA 29% Week 1 Taiwan EWT 28% Week 1 Canada EWC 28% Week 1 Brazil EWZ 21% Week 1 Switzerland EWL 21% Week 1 Germany EWG 20% Week 1 United Kingdom EWU 20% Week 1 China FXI 19% Week 1 Belgium EWK 13% Week 1 The Netherlands EWN 13% Week 1 Japan EWJ 12% Week 1 France EWQ 9% Week 1 Austria EWO 9% Week 1 Italy EWI -7% Week 1 Spain EWP -17% Week 1
India continues its growth as the recent visit of President Obama signals. There is increasing pressure for India to open its markets to the US to make the relationship a two way street.
South African Finance Minister Pravin Gordhan said the U.S. decision to purchase bonds to pump money into the economy may push up the rand and cost jobs. Group of 20 nations meeting in South Korea this week need to agree on ways to stimulate their economies without damaging those of others.
SINGAPORE Airlines has reported a second-quarter profit of $380 million, reversing a $159 million loss during the same July-September period last year. The results were delivered on the back of a 18 per cent jump in revenue to $3.63 billion, as load factors and yields continued to improve, the airline said on Tuesday.
Hong Kong launched a campaign Monday to promote itself as a global financial hub and rejected suggestions that it was trying to counter growing competition from Shanghai.
President Felipe Calderón, declared his support for small and medium businesses, which produce 7 out of the 10 jobs in Mexico
Japanese Prime Minister Naoto Kan on Tuesday pledged to bring Japan into the Trans-Pacific Strategic Economic Partnership Agreement, or TPP, saying the trade liberalization initiative will help the country return to a path of robust growth.
The Bank of France forecasts 0.5-percent fourth-quarter growth The French economy is struggling to put its strained public finances in order. There have been many protests about the move to increase the retirement age.
Recently the Austrian government greed to a rigid austerity budget which involves massive social cuts. At the same time, the government plans to raise taxes primarily for lower and middle income brackets.
Italy is the Eurozone's third largest economy, accounting for about 17% of GDP and has come through in reasonable shape. The banks are strong and Italians are Europe's best savers. Recently the the European Commission raised its growth forecast for Italy, projecting that faster export growth will see GDP expand by 1.1% this year up from 0.8% forecast in May.
Spain's troubled banking sector is back in the news again. Despite the apparently succesful stress tests carried out over the summer problems persist, and don't seem likely to go away soon. Foremost among these is the steady rise in problem loans which have now risen to an all-time high, potentially endangering the credit rating of the country's financial institutions, according to a recent report from the credit ratings agency Moody's.
In conclusion, the G20 meeting is the big ticket item this week and what results could impact the direction of the indicators.
labels:investment,
Symbols: INP,EZA,EWS,EWH,EWW,EWM,EWY,RSX,EWA,EWT,EWC,EWZ,EWL,EWG,EWU,FXI,EWK,EWN,EWJ,EWQ,EWO,EWI,EWP,SPY,QQQQ,IWM,MDY,EFA,VEU,EEM,VWO,IYR,ICF,VNQ,GSG,DBC,DBA,USO,LQD,CSJ,CIU,HYG,JNK,PHB,TLT,IEF,SHY,SHV,BND,AGG,MUB,MBB,
- Top Tier ETF Broker Playoffs II
10/26/2010
ETF’s continue to broaden their appeal both in terms of flexibility and low cost. With commission free ETF’s, more money stays in the investors pocket rather than disappearing in fees. We have completed the first analysis of TD Ameritrade and Schwab, we now proceed to examine Vanguard and Fidelity – two long term ETF providers.
Vanguard is one of the largest index fund and ETF providers offering commission-free trading to its brokerage clients that use its lineups of 62 proprietary ETFs. Commission free ETF's are also offered by Fidelity and Schwab but Vanguard has the highest number of proprietary funds available.
These funds enable participants to gain exposure to 5 major assets: Us Equity , Foreign Equity , Emerging Market Equity , Reits , Fixed Income .
The list of minor asset classes covered:Communications: IXP , PTE , DGG , LTL
Consumer Discretionary: RXI , VCR
Consumer Staples: KXI , VDC , PSL , DPN , RHS
Diversified Emerging Mkts: EEM , GMM , PXH , DEM , SCHE
Diversified Pacific/asia: EPP , VPL , GMF , PAF
Equity Energy: ITE , IXC , IPW , DBE , RYE , DKA
Europe Stock: IEV , VGK , PEF , DEB
Financial: IYF , VFH , IPF , PFI , DRF , RYF
Foreign Large Blend: EFA , VEU , GWL , PFA
Foreign Small/mid Growth: IFSM , VSS , SCHC
Health: IYH , IXJ , VHT , XBI , PBE , DBR , RYH
High Yield Bond: HYG , JNK , PHB
Industrials: IYJ , EXI , VIS
Intermediate Government: IEI , VGIT , ITE
Intermediate-term Bond: AGG , CIU , BIV , BND
Large Blend: IVV , IYY , IWV , VTI , VV , SPY , DLN , RSP , SCHX
Large Growth: IVW , IWZ , JKE , VUG , ELG , QQQQ , RPG , SCHG
Large Value: IVE , IWW , JKF , VTV , ELV , PWV , RPV , SCHV
Long Government: TLT , TLH , IEF , EDV , VGLT , TLO , PLW
Long-term Bond: CLY , LQD , BLV , VCLT
Mid-cap Blend: IJH , IWR , JKG , VO , MDY , EMM , PJG , DON , EZM , MVV
Mid-cap Growth: IJK , IWP , VOT , EMG , PWJ , RFG , UKW
Mid-cap Value: IJJ , IWS , JKI , VOE , EMV , PWP , RFV , UVU
Natural Resources: IYM , IGE , VAW , XLB , XME , PYZ , DBN , RTM , UYM
Real Estate: IYR , ICF , VNQ
Short Government: SHY , SHV , VGSH , PLK , USY
Short-term Bond: CSJ , BSV , VCSH
Small Blend: IJR , IWM , JKJ , VB , DSC , PJM , DES , SAA , UWM , SCHA
Small Growth: IJT , IWO , JKK , VBK , DSG , PWT , RZG , UKK
Small Value: IJS , IWN , JKL , VBR , DSV , PWY , RZV , UVT
Technology: MTK , PTF , DBT , RYT , ROM
Utilities: GII , PUI , DBU , RYU , UPW
World Stock: IOO , VT
As of Oct 22, 2010, this plan investment choice is rated as based on MyPlanIQ Plan Rating methodology that was designed to measure how effective a plan's available investment funds are . It has the following detailed ratings:
Diversification -- Rated as average (57%)
Fund Quality -- Rated as average (60%)
Portfolio Building -- Rated as average (39%)
Overall Rating: average (50%)
The chart and table below show the historical performance of moderate model portfolios employing strategic and tactical asset allocation strategies ( SAA and TAA , both provided by MyPlanIQ). For comparison purpose, we also include the moderate model portfolios of a typical 5 asset SIB (Simpler Is Better) plan .
This SIB plan has the following candidate index funds and their ETFs equivalent:Us Equity:( SPY or VTI )
Foreign Equity:( EFA or VEU )
Emerging Market Equity:( EEM or VWO )
Reits:( IYR or VNQ or ICF )
Fixed Income:( AGG or BND )
Performance chart (as of Oct 22, 2010)
Performance table (as of Oct 22, 2010)Portfolio Name1Yr AR1Yr Sharpe3Yr AR3Yr Sharpe5Yr AR5Yr Sharpe13%83%6%35%13%81%15%116%2%6%8%42%11%72%7%54%15%105%14%103%3%13%9%41%
Currently, asset classes in Emerging Market Equity( EEM , VWO ) , Reits( IYR , VNQ , ICF ) and Fixed Income( AGG , BND ) are doing relatively well. These asset classes are available to Vanguard 62 participants.
Fidelity now makes trading 25 iShares ETFs for free. These ETFs cover complete US equity sizes and styles (large/mid/small caps and growth/blend/value styles). It covers international equity markets well too. In additon, it has good fixed income ETFs. The missing major asset classes are REITs and commodities. We hope those will be made free too. A plan called Fidelity Commission Efficient ETFs extends this plan by including several addtional ETFs (which cost $7.95 flat commission per trade).Fidelity 25 Commission Free ETFs's 401K plan consists of 25 funds. These funds enable participants to gain exposure to 4 major assets: Us Equity , Foreign Equity , Emerging Market Equity , Fixed Income . The list of minor asset classes covered:Diversified Emerging Mkts: EEM , GMM , PXH , DEM , SCHE
Emerging Markets Bond: PCY
Foreign Large Blend: EFA , VEU , GWL , PFA
Foreign Small/mid Value: SCZ
Inflation-protected Bond: TIP
Intermediate-term Bond: AGG , CIU , BIV , BND
Large Blend: IVV , IYY , IWV , VTI , VV , SPY , DLN , RSP , SCHX
Large Growth: IVW , IWZ , JKE , VUG , ELG , QQQQ , RPG , SCHG
Large Value: IVE , IWW , JKF , VTV , ELV , PWV , RPV , SCHV
Long-term Bond: CLY , LQD , BLV , VCLT
Mid-cap Blend: IJH , IWR , JKG , VO , MDY , EMM , PJG , DON , EZM , MVV
Mid-cap Growth: IJK , IWP , VOT , EMG , PWJ , RFG , UKW
Mid-cap Value: IJJ , IWS , JKI , VOE , EMV , PWP , RFV , UVU
Muni National Long: MUB , TFI , PZA , MLN
Small Blend: IJR , IWM , JKJ , VB , DSC , PJM , DES , SAA , UWM , SCHA
Small Growth: IJT , IWO , JKK , VBK , DSG , PWT , RZG , UKK
Small Value: IJS , IWN , JKL , VBR , DSV , PWY , RZV , UVT
World Stock: IOO , VT
As of Oct 22, 2010, this plan investment choice is rated as based on MyPlanIQ Plan Rating methodology that was designed to measure how effective a plan's available investment funds are.
It has the following detailed ratings:Diversification -- Rated as average (63%)
Fund Quality -- Rated as poor (9%)
Portfolio Building -- Rated as below average (14%)
Overall Rating: below average (27%)
The chart and table below show the historical performance of moderate model portfolios employing strategic and tactical asset allocation strategies ( SAA and TAA , both provided by MyPlanIQ). For comparison purpose, we also include the moderate model portfolios of a typical 4 asset SIB (Simpler Is Better) plan .
This SIB plan has the following candidate index funds and their ETFs equivalent:Us Equity:( SPY or VTI )
Foreign Equity:( EFA or VEU )
Emerging Market Equity:( EEM or VWO )
Fixed Income:( AGG or BND )
Performance chart (as of Oct 22, 2010)
Performance table (as of Oct 22, 2010)Portfolio Name1Yr AR1Yr Sharpe3Yr AR3Yr Sharpe5Yr AR5Yr Sharpe3%24%3%19%11%71%10%68%-0%-3%7%28%2%14%6%47%14%90%10%75%2%5%8%37%
Currently, asset classes in Foreign Equity( EFA , VEU ) , Emerging Market Equity( EEM , VWO ) and Fixed Income( AGG , BND ) are doing relatively well. These asset classes are available to Fidelity 25 Commission Free ETFs participants.
To summarize:- Vanguard 62 Commission Free ETFs plan participants have seen returns in the 8-13% range for a moderate portfolio with strategic and tactical asset allocation based on having a five asset class portfolio.
- Fidelity 25 Commission Free ETFs plan participants have seen returns in the 7-11% range for a moderate portfolio with strategic and tactical asset allocation based on having a five asset class portfolio.
labels:investment,
Symbols:AGG,BIV,BLV,BND,BSV,CIU,CLY,CSJ,DBE,DBN,DBR,DBT,DBU,DEB,DEM,DES,DGG,DKA,DLN,DON,DPN,DRF,DSC,DSG,DSV,EDV,EEM,EFA,ELG,ELV,EMG,EMM,EMV,EPP,EXI,EZM,GII,GMF,GMM,GWL,HYG,ICF,IEF,IEI,IEV,IFSM,IGE,IJH,IJJ,IJK,IJR,IJS,IJT,IOO,IPF,IPW,ITE,IVE,IVV,IVW,IWM,IWN,IWO,IW,
- TD Ameritrade Commission Free ETFs: Comprehensive Portfolio Building Blocks
10/19/2010
- Top Tier ETF Providers Playoffs II
10/19/2010
- Top Tier ETF Provider Playoffs
10/19/2010
- Lazy Portfolios -- The Playoffs II
10/19/2010
- Lazy Portfolios -- The Playoffs
10/19/2010
- Bernstein's No Brainer and Smart Money Portfolios Reviewed
10/08/2010
- Diversification, Style AND Asset Rotation Improve Portfolio Performance without Incurring Extra Risk
10/08/2010
- Break Free of your Bonds
07/19/2010
- Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Report On 12/03/2010
12/03/2010
This report reviews Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan plan. We will discuss the investment choices and present the plan rating by MyPlanIQ. Current economic and market conditions are discussed in the context of the investment portfolios in the plan. We will then show how participants in Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan can achieve reasonable investment results using asset allocation strategies.
Plan Review and Rating
--
Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan's 401K plan consists of 55 funds. These funds enable participants to gain exposure to 5 major assets: US Equity, Foreign Equity, Commodity, Emerging Market Equity, Fixed Income. The list of minor asset classes covered:
Commodities Broad Basket: GSG, DBC
Conservative Allocation: AOK
Diversified Emerging Mkts: EEM, GMM, PXH, DEM, SCHE
Diversified Pacific/asia: EPP, VPL, GMF, PAF
Equity Energy: ITE, IXC, IPW, DBE, RYE, DKA
Europe Stock: IEV, VGK, PEF, DEB
Foreign Large Blend: EFA, VEU, GWL, PFA
Foreign Small/mid Growth: IFSM, VSS, SCHC
Health: IYH, IXJ, VHT, XBI, PBE, DBR, RYH
Inflation-protected Bond: TIP
Intermediate-term Bond: AGG, CIU, BIV, BND
Large Blend: IVV, IYY, IWV, VTI, VV, SPY, DLN, RSP, SCHX
Large Growth: IVW, IWZ, JKE, VUG, ELG, QQQQ, RPG, SCHG
Large Value: IVE, IWW, JKF, VTV, ELV, PWV, RPV, SCHV
Latin America Stock: ILF, GML
Long Government: TLT, TLH, IEF, EDV, VGLT, TLO, PLW
Mid-cap Value: IJJ, IWS, JKI, VOE, EMV, PWP, RFV, UVU
Multisector Bond: AGG, GBF, BND, LAG
Natural Resources: IYM, IGE, VAW, XLB, XME, PYZ, DBN, RTM, UYM
Pacific/asia Ex-japan Stk: EPP, AAXJ, GMF, PAF, DND
Short Government: SHY, SHV, VGSH, PLK, USY
Short-term Bond: CSJ, BSV, VCSH
Small Growth: IJT, IWO, JKK, VBK, DSG, PWT, RZG, UKK
Technology: MTK, PTF, DBT, RYT, ROM
As of Dec 2, 2010, this plan investment choice is rated as based on MyPlanIQ Plan Rating methodology that measures the effectiveness of a plan's available investment funds. It has the following detailed ratings:
Diversification -- Rated as (91%)
Fund Quality -- Rated as (48%)
Portfolio Building -- Rated as (84%)
Overall Rating: (75%)Current Economic and Market Conditions
We have experienced an uncertain 2010: plenty of worries on whether the US economy will climb out of the great recession and recover.
- The Federal Reserve embarked on Quantitative Easing II (QE2) to stimulate the economy.
- The housing market is still at its low but largely stabilized.
- The unemployment rate is stuck at 9%.
Americans continue to face an uncertain future, given (among others) the high unemployment rate, large federal and local government debts and global trade imbalance. With such an economic backdrop, the stock and debt markets are going to be volatile. Despite this, markets have been resilient and appear positioned to rebound.
In this market it is even more critical to properly diversify and respond market changes. MyPlanIQ offers two asset allocation strategies: strategic and tactical asset allocation strategies ( SAA and TAA for participants in Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan).
Strategic Asset Allocation is based on well known modern portfolio theory and its key features include: diversification, proper fund selection and periodically re-balancing.
Tactical Asset Allocation works on a diversified array of assets provided by funds in a plan and adjusts asset mixes based on market conditions such as asset price momentum utilized by TAA.
Portfolio Discussions
The chart and table below show the historical performance of moderate model portfolios employing strategic and tactical asset allocation strategies. For comparison purpose, we also include the moderate model portfolios of a typical 4 asset SIB (Simpler Is Better) plan . This SIB plan has the following candidate index funds and their ETFs equivalent:
US Equity: (SPY or VTI)
Foreign Equity: (EFA or VEU)
Emerging Market Equity: (EEM or VWO)
Fixed Income: (AGG or BND)
Performance chart (as of Dec 2, 2010)Performance table (as of Dec 2, 2010)
Portfolio Name 1Yr AR 1Yr Sharpe 3Yr AR 3Yr Sharpe 5Yr AR 5Yr Sharpe Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Tactical Asset Allocation Moderate 6% 44% 7% 51% 16% 109% Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan Strategic Asset Allocation Moderate 12% 119% 3% 21% 9% 61% Four Core Asset ETF Index Funds Emerging Markets Tactical Asset Allocation Moderate 1% 6% 6% 49% 12% 78% Four Core Asset ETF Index Funds Emerging Markets Strategic Asset Allocation Moderate 10% 75% 2% 6% 7% 31% Currently, asset classes in Foreign Equity (EFA,VEU), Emerging Market Equity (EEM,VWO) and Fixed Income (AGG,BND) are doing relatively well. These asset classes are available to Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan participants.
To summarize, Allegheny Ludlum Corporation Personal Retirement and 401(k) Savings Account Plan plan participants can achieve reasonable investment returns by adopting asset allocation strategies that are tailored to their risk profiles.
Symbols: ATI , SPY , VTI , EFA , VEU , EEM , VWO , AGG , BND , DBC , AOK , CIU , BIV , IYH , IXJ , VHT , XBI , PBE , DBR , RYH , IYM , IGE , VAW , XLB , XME , PYZ , DBN , RTM , UYM , MTK , PTF , DBT , RYT , ROM , GWL , PFA , IVE , IWW , JKF , VTV , ELV , PWV , RPV , SCHV , IVV , IYY , IWV , VV , DLN , RSP , SCHX , SHY , SHV , VGSH , PLK , USY , TLT , TLH , IEF , EDV , VGLT , TLO , PLW , IEV , VGK , PEF , DEB , IVW , IWZ , JKE , VUG , ELG , QQQQ , RPG , SCHG , IJJ , IWS , JKI , VOE , EMV , PWP , RFV , UVU , IFSM , VSS , SCHC , GMM , PXH , DEM , SCHE , GBF , LAG , CSJ , BSV , VCSH , ITE , IXC , IPW , DBE , RYE , DKA , ILF , GML , IJT , IWO , JKK , VBK , DSG , PWT , RZG , UKK , TIP , EPP , VPL , GMF , PAF , AAXJ , DND , GSG
- Vanguard Variable Annuity Report On 12/06/2010
12/06/2010
- TD Ameritrade Commission Free ETFs Report On 12/07/2010
12/07/2010