03/16/2011

by Kevin Carr, A MyPlanIQ Expert User

On March 9, 2011, Charles Schwab announced the release of the ETF Select List.  The quarterly Schwab ETF Select List was created by Charles Schwab Investment Advisory, Inc. and is a filtered list of all of the ETFs in the marketplace, highlighting pre-screened, low-cost ETFs.  Schwab used quantitative and qualitative screens to filter each ETF and build the list, covering 6 major asset categories and 45 minor asset categories. All ETFs, including Schwab ETFs, are evaluated using the same criteria and broken into sectors for US Equity, Foreign Equity, Emerging Market Equity, Fixed Income, Commodity and REITs.

While the ETF Select List has only been out a few days, I constructed a plan on MyPlanIQ platform.  The Schwab ETF Select List  has no redemption periods, is commission efficient and offers low expenses. 

As of March 13, the Schwab ETF Select List Plan has a four star investment menu rating with a 99% diversification score and an overall above average investment choice based on MyPlanIQ Plan Rating methodology .  The Plan Rating methodology is designed to measure how effective a plan’s available funds are using key factors such as diversification, fund quality and portfolio building.

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 6 asset SIB (Simpler Is Better) plan . This SIB plan has the following candidate index funds and their ETFs equivalent:

US Equity: SPY or VTI
Commodity: DBC
Foreign Equity: EFA or VEU
REITs: IYR or VNQ or ICF
Emerging Market Equity: EEM or VWO
Fixed Income: AGG or BND

Performance chart (as of Mar 15, 2011)

Performance table (as of Mar 15, 2011)

Currently Commodities, Real Estate and US Equity are doing well. These asset classes are available to Schwab ETF Select List participants.

To Summarize, Schwab ETF Select List Plan offers wide diversification, high quality funds with low expenses. compared with other brokerage supported ETF plans, it is very favorable. From time to time, we will review the plan.

Symbols:DBC,DBA,IAU,DBB,USL,PFF,VNQ,XLY,XLP,XLE,XLF,XLV,XLI,XLB,XLK,IYZ,XLU,BND,SCHO,SCHR,TLH,SCHP,CIU,JNK,BWX,MUB,SCHF,EFG,EFV,SCHC,SCHE,VEU,VT,VGK,VPL,EWJ,GXC,SCHX,SCHG,SCHV,VO,VOT,VOE,SCHA,VBK,VBR,SCHB,VYM,

Symbols (exchange): (DBC),(DBA),(IAU),(DBB),(USL),(PFF),(VNQ),(XLY),(XLP),(XLE),(XLF),(XLV),(XLI),(XLB),(XLK),(IYZ),(XLU),(BND),(SCHO),(SCHR),(TLH),(SCHP),(CIU),(JNK),(BWX),(MUB),(SCHF),(EFG),(EFV),(SCHC),(
SCHE),(VEU),(VT),(VGK),(VPL),(EWJ),(GXC),(SCHX),(SCHG),(SCHV),(VO),(VOT),(VOE),(SCHA),(VBK),(VBR),(SCHB),(VYM)

comments(0) 

12/19/2010

Commodities were largely stable last week (see Commodities Trend Table on MyPlanIQ 360 Degree Market View). 

Silver (SLV) remained to be at the top spot, though it is one of the most volatile commodities. Gold (GLD) was steady. Agriculture commodities (DBA), as what we have pointed out previously, continued its strong momentum. 

The natural gas (UNG) was again a biggest loser in the week. Here is what U.S. Energy Information Administration had to say on natural gas price: "With cold temperatures gripping much of the country for the first half of December, the heating season is well underway with large storage withdrawals. Nonetheless, a trend of rising prices since Thanksgiving ended during this report week for most regions of the country. Following two weeks of increases, the price at the Henry Hub declined $0.24 per MMBtu to $4.22 and is now just one cent higher than its price at the beginning of December..."

One should pay attention to the severe drawback of some of commodity ETFs such as UNG and USO that suffer from so called 'Contango'. We are closely monitoring the situation to see whether we should switch to UNL and/or USL (using twelve month contracts instead of front month contracts) for the monitoring purposes. 

Portfolios utilizing trends for commodity long/short investing (such as MyPlanIQ's Commodity Trend Indicator Strategy) started to stabilize in the second half of this year due to more stable trends. We will furnish a year end report on these portfolios. 

labels:investment,

Symbols:SLV,DBP,GLD,DBB,DBA,DBC,DBE,USO,UNG,UNL,USL,SPY,QQQQ,IWM,MDY,EFA,VEU,EEM,VWO,IYR,ICF,VNQ,GSG,LQD,CSJ,CIU,HYG,JNK,PHB,TLT,IEF,SHY,SHV,BND,AGG,MUB,MBB,

comments(0)