 |
Vanguard ETF: |  |
7.4%* |
|
Diversified Core: | |
8.1%* |
|
Six Core Asset ETFs: | |
7.3%* |
Articles on DJI
- Economic Indicators Signal Overvalued Stock Markets
07/18/2011
Markets have gone through risk on and off modes several times this year. Considering the state of global and domestic economy, this is not surprising. The tug of war between solid U.S. corporation balance sheets (other than financial companies) and the weak recovery ladened with bad news (such as the recent European debts) continued.
As of 7/15/2011, we have the following readings the market valuation:
- Buffet Stock Market Indicator: The ratio of the total stock market capitalization to GNP is 93%. US stock market is Modestly Overvalued. See the Historical Chart and related description.
- Shiller CAPE10: The ratio of Real Price to the average of last 10 year Real Earnings(CAPE10)(23.92) to its long term average (16.41) is 1.46. US stock market is 46% Overvalued. See the Historical Chart and related description.
- Hussman Peak PE: The ratio of Real Price to the average of last 10 year Peak Real Earnings(14.16) to its long term average (11.94) is 1.19. US stock market is 19% Overvalued. See the Historical Chart and related description.
Another important metric credit spread (TED Spread) that measures on BAA-rated and AAA-rated corporate bonds has been above 20 basis points or so for over 3 months now. This is still a quite low reading in a longer period but judging in the last 9 months, it is elevated. When credit spread is high, it signals investors' concern on risk. See the Historical Chart.
Based on the latest weekly commentary by John Hussman, current stock valuations imply expected 10-year S&P 500 total returns of about 3.8% annually.
To summarize, markets are over valued. The tug of war is leaning more toward downside than upside. For retirement investing portfolios, it is a good time to balance back to target allocations that you are comfortable with and adopt a systematic approach.
Symbols: SPY, DJI, AGG, SPX, DJI, COMP, Economic Indicators
Exchange Tickers: (AGG), (SPY)
- Economic Indicators Signal Overvalued Stock Markets
07/18/2011
Markets have gone through risk on and off modes several times this year. Considering the state of global and domestic economy, this is not surprising. The tug of war between solid U.S. corporation balance sheets (other than financial companies) and the weak recovery ladened with bad news (such as the recent European debts) continued.
As of 7/15/2011, we have the following readings the market valuation:
- Buffet Stock Market Indicator: The ratio of the total stock market capitalization to GNP is 93%. US stock market is Modestly Overvalued. See the Historical Chart and related description.
- Shiller CAPE10: The ratio of Real Price to the average of last 10 year Real Earnings(CAPE10)(23.92) to its long term average (16.41) is 1.46. US stock market is 46% Overvalued. See the Historical Chart and related description.
- Hussman Peak PE: The ratio of Real Price to the average of last 10 year Peak Real Earnings(14.16) to its long term average (11.94) is 1.19. US stock market is 19% Overvalued. See the Historical Chart and related description.
Another important metric credit spread (TED Spread) that measures on BAA-rated and AAA-rated corporate bonds has been above 20 basis points or so for over 3 months now. This is still a quite low reading in a longer period but judging in the last 9 months, it is elevated. When credit spread is high, it signals investors' concern on risk. See the Historical Chart.
Based on the latest weekly commentary by John Hussman, current stock valuations imply expected 10-year S&P 500 total returns of about 3.8% annually.
To summarize, markets are over valued. The tug of war is leaning more toward downside than upside. For retirement investing portfolios, it is a good time to balance back to target allocations that you are comfortable with and adopt a systematic approach.
Symbols: SPY, DJI, AGG, SPX, DJI, COMP, Economic Indicators
Exchange Tickers: (AGG), (SPY)
- Economic Indicators Signal Overvalued Stock Markets
07/18/2011
Markets have gone through risk on and off modes several times this year. Considering the state of global and domestic economy, this is not surprising. The tug of war between solid U.S. corporation balance sheets (other than financial companies) and the weak recovery ladened with bad news (such as the recent European debts) continued.
As of 7/15/2011, we have the following readings the market valuation:
- Buffet Stock Market Indicator: The ratio of the total stock market capitalization to GNP is 93%. US stock market is Modestly Overvalued. See the Historical Chart and related description.
- Shiller CAPE10: The ratio of Real Price to the average of last 10 year Real Earnings(CAPE10)(23.92) to its long term average (16.41) is 1.46. US stock market is 46% Overvalued. See the Historical Chart and related description.
- Hussman Peak PE: The ratio of Real Price to the average of last 10 year Peak Real Earnings(14.16) to its long term average (11.94) is 1.19. US stock market is 19% Overvalued. See the Historical Chart and related description.
Another important metric credit spread (TED Spread) that measures on BAA-rated and AAA-rated corporate bonds has been above 20 basis points or so for over 3 months now. This is still a quite low reading in a longer period but judging in the last 9 months, it is elevated. When credit spread is high, it signals investors' concern on risk. See the Historical Chart.
Based on the latest weekly commentary by John Hussman, current stock valuations imply expected 10-year S&P 500 total returns of about 3.8% annually.
To summarize, markets are over valued. The tug of war is leaning more toward downside than upside. For retirement investing portfolios, it is a good time to balance back to target allocations that you are comfortable with and adopt a systematic approach.
Symbols: SPY, DJI, AGG, SPX, DJI, COMP, Economic Indicators
Exchange Tickers: (AGG), (SPY)
- Economic Indicators Signal Overvalued Stock Markets
07/18/2011
Markets have gone through risk on and off modes several times this year. Considering the state of global and domestic economy, this is not surprising. The tug of war between solid U.S. corporation balance sheets (other than financial companies) and the weak recovery ladened with bad news (such as the recent European debts) continued.
As of 7/15/2011, we have the following readings the market valuation:
- Buffet Stock Market Indicator: The ratio of the total stock market capitalization to GNP is 93%. US stock market is Modestly Overvalued. See the Historical Chart and related description.
- Shiller CAPE10: The ratio of Real Price to the average of last 10 year Real Earnings(CAPE10)(23.92) to its long term average (16.41) is 1.46. US stock market is 46% Overvalued. See the Historical Chart and related description.
- Hussman Peak PE: The ratio of Real Price to the average of last 10 year Peak Real Earnings(14.16) to its long term average (11.94) is 1.19. US stock market is 19% Overvalued. See the Historical Chart and related description.
Another important metric credit spread (TED Spread) that measures on BAA-rated and AAA-rated corporate bonds has been above 20 basis points or so for over 3 months now. This is still a quite low reading in a longer period but judging in the last 9 months, it is elevated. When credit spread is high, it signals investors' concern on risk. See the Historical Chart.
Based on the latest weekly commentary by John Hussman, current stock valuations imply expected 10-year S&P 500 total returns of about 3.8% annually.
To summarize, markets are over valued. The tug of war is leaning more toward downside than upside. For retirement investing portfolios, it is a good time to balance back to target allocations that you are comfortable with and adopt a systematic approach.
Symbols: SPY, DJI, AGG, SPX, DJI, COMP, Economic Indicators
Exchange Tickers: (AGG), (SPY)
- 6 Hedge Fund ETFs for Average Investors
07/17/2011
This weekend's Barron's has an article Hedge-Fund Strategies for the Masses that discussed the following ETFs:
WisdomTree Managed Futures Strategy (WDTI) Credit Suisse Merger Arbitrage Liquid Index ETN (CSMA) Cambria Global Tactical ETF (GTAA) Credit Suisse Long/Short Liquid ETN (CSLS) Regular readers might be familiar with our report published on SeekingAlpha 5 Hedge Fund ETFs to Watch. These ETFs are monitored weekly on our ETFs in asset classes page.The following shows the performance table:
As of 07/15/2011
Description Symbol 1 Yr 3 Yr 5 Yr Avg. Volume(K) 1 Yr Sharpe IQ Hedge Multi-Strategy QAI 5.2% NA NA 30 130.52% Credit Suisse Merger Arbitrage CSMA NA NA NA 28 NA Mars Hill Global Relative Value GRV -13.38% NA NA 10 -101.0% PowerShares S&P 500 BuyWrite PBP 4.27% -1.32% NA 31 74.32% ProShares Credit Suisse 130/30 CSM 20.51% NA NA 19 146.25% Cambria Global Tactical ETF GTAA NA NA NA 53 NA Cambria Global Tactical ETF (GTAA) was just recently added to the table. This ETF is managed by Mebane Faber and Eric Richardson, authors of The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets.
Mebane Faber is no stranger to MyPlanIQ's strategies. Our tactical asset allocation strategy bears some similarity with some ideas proposed in his articles. It is thus interesting to undestand more on this ETF.
Based on Barron's, GTAA's neutral allocation is 20% in five categories: real estate, commodities, bonds, U.S. stocks and foreign stocks. These five assets are part of our six core asset classes (other than emerging market stocks). The fund holds about 80 ETFs. Let's compare it with our simplest Six Core Asset ETFs Tactical Asset Allocation Moderate Portfolio.
Portfolio Performance Comparison
Portfolio/Fund Name 2010 2011 2011 Sharpe 2011 Drawdown GTAA 1.96% 2.19% 0.46 6.1% Six Core Asset ETFs Tactical Asset Allocation Moderate 9.27% 4.25% 0.49 4.6% S&P 500 (SPY, SPX) 14.58% 5.7% 0.84 6.9% Since GTAA was started on 10/26/2010, the comparison in 2010 is not meaningful. Furthermore, with the fund's $184 million asset size, it is understandable that it tries to invest in many ETFs for diversification purpose.
Since all of these hedge funds are very new, investors need to monitor these for a while to fully understand how they behave. However, with its simplicity and long history of practice in wealth management, we have confidence on GTAA's future.
Symbols: SPX, DJI, GTAA, QAI, CSMA, CSM, GRV, PBP, Hedge Funds
Exchange Tickers: (GTAA), (QAI), (CSMA), (CSM), (GRV), (PBP), (SPY)
- Tha Fallacy of "Stocks for The Long Run"
07/15/2011
- GMO’s Lean Investment Outlook
04/08/2011
