 |
Vanguard ETF: |  |
7.4%* |
|
Diversified Core: | |
8.1%* |
|
Six Core Asset ETFs: | |
7.3%* |
Articles on SLV
- Retirement Investments: Compared with Hedge Fund Performance
11/08/2011
The following is the newest October hot shot hedge fund performance data:
More specifically,
Strategies/Portfolios YTD (as of 10/31/2011) Fund of Funds - Diversifed -4.84% Diversified Macro -1.42% Global Macro -2.15% Six Core Asset ETF Strategic Asset Allocation Moderate 0.69% Six Core Asset ETF Tactical Asset Allocation Moderate -2.56% Permanent Portfolio Global trategic Asset Allocation Moderate 1% Permanent Portfolio Global Tactical Asset Allocation Moderate 2.13% Our Tactical Asset Allocation(TAA) is similar to Global macro hedge fund strategy. We can see that both Strategic Asset Allocation and Tactical Asset Allocation model portfolios are compared favorably with the hedge fund averages.
For more information, see Six Core Asset ETFs plan that has ONLY 6 broadbase ETFs (Vanguard low cost ETFs VTI, VEU, VNQ, VWO, BND and one Poweshares DB Commodities ETF DBC).
Permanent Global Portfolio ETF Plan uses Gold (GLD), silver (SLV) and other ETFs to form a diversified hedging portfolio.
Symbols: SPX, COMP, VTI, VEU, VNQ, VWO, BND, DBC, GLD, SLV, TLT, IYR, Retirement Investments, Hedge Funds, Asset Allocation
- Retirement Investments: Right Expectations at The Right Time
09/23/2011
Global stock market has entered a bear market, based on a Bloomberg report Global Stocks Drop 20% Into Bear Market as Debt Crisis Outweighs Profits. For many investors who are managing their retirement investments such as 401K, it is a high time to review and set a proper expectation.
Chuck Jaffe at MarketWatch.com reported that Rob Arnott of Research Affiliates told financial advisers to reshape their return expectations dramatically for the coming decade and beyond.
Arnott outlined the following:
Last 30 Years Average Annual Return Coming Decade Expected Return Stocks (S&P 500 Total Return) 11% 4-6% Bonds 9% 2-4% He further suggested "investors will need to be increasingly tactical, trading into markets that are unloved and undervalued and being prepared to leave markets that have gotten overheated, and considering alternative strategies that can supplement the baseline stock and bond market returns."
Given an extremely high possibility that we are entering the second recession, investors should have an investment plan in place for their retirement investments. In addition to Tactical Asset Allocation(TAA), one should stick to
- Diversification: not only this reduces risk, it also gives you more opportunities to extract returns elsewhere. In addition to stocks (SPX) and bonds (AGG), asset classes such as Real Estate Investment Trusts (REITs) and Commodities including precious metals (Gold GLD)
- Tactical or Alternative strategy driven ETFs or mutual funds. In this area, however, investors should again have a solid fund selection algorithm to weed out under performing funds or strategies.
However, a proper risk tolerated strategic asset allocation portfolio should always have a place in one's overall portfolios (only a portion instead of all in such a portfolio). Periodically rebalancing will allow investors to capture the bigger future return of undervalued stocks or other asset classes.
See Six Core Asset ETFs for an example of diversification and tactical asset allocation. It uses only 6 diversified major asset ETFs.
Symbols: SPX, COMP, GLD, VTI, EFA, EEM, IYR, DBC, SLV, AGG, BND, Retirement Investments, Portfolio Management, Risk Management, Tactical Asset Allocation
- Advisors Turning to Alternative Investments: What ETFs Can You Use?
08/30/2011
Indexuniverse.com reports the following:
"Alternative investments, including hedge fund strategies, are becoming more popular, as many advisors turn to off-the-beaten-path vehicles for everything from portfolio diversification to risk management to generate returns, a study from Cambridge, Mass.-based Cogent Research showed.
To date, nearly 80 percent of all retail advisors interviewed in the survey rely on alternative strategies within client portfolios, allocating on average 11 percent of their book to such strategies. Apart from hedge funds, alternative investment strategies include venture capital, private equity, limited partnerships and structured products and notes.
Of all those making use of alternative investment strategies, more than 40 percent of them will increase their use of ETFs in the next 12 months. Comparative data weren’t available, as this is the first time Cogent addressed the use of alternatives."
Read more on
Advisors Turning To Alternative Investments
For investors who have IRAs and taxable accounts, they can access to ETFs easily these days. While we certainly do not suggest average investors to venture into venture capital, private equity and other illiquid asset classes, some of hedge fund style ETFs can be useful for asset allocation purpose. Furthermore, our Tactical Asset Allocation(TAA) strategy can be classified as an alternative investment strategy (it depends on whether one would throw anything non-conventional Tactical Asset Allocation(TAA) into the 'alternative' bucket).
We should also point out that many people consider Real Estate Investment Trusts (REITs such as IYR, VNQ), Gold (GLD, IAU), Silver (SLV) or commodities (DBC, GSG) as alternative investments.
Considering recent market and economic environments, these ETFs or strategies are playing an important roles in retirement investing for diversification and risk management purposes. In fact, many of these strategies or portfolios have done a good job to hedge against general stock market (S&P 500 SPX, Nasdaq COMP) downturns.
We have published several research articles on alternative ETFs:
Managed Futures ETFs Are Useful Portfolio Diversifiers
6 Hedge Fund ETFs for Average Investors
Commodity Investing: Long/Short (S&P Commodity Trend Indicators) vs. Long-Only
Or these portfolios:
Permanent Global Portfolio ETF Plan
MyPlanIQ Diversified Core Allocation ETF Plan
Symbols: SPX, COMP, IYR, VNQ, GLD, IAU, SLV, DBC, GSG, Portfolio Strategy & Asset Allocation
- 3 Ways to Manage Your Portfolios to Cope with World Wide Food Inflation
08/26/2011
The Google map from www.econmatters.com shows how serious the world wide food crisis has become.
Legends:
Fist = Overthrown Governments
Flames = Actual food / inflation riots
Police = Protests / other riots
$ = Price increase announcements / Price Controls / Stock market issues
! = Strike in inflation / food related industries
Phone = Internet/ Twitter /shutdownView Inflation Riots and Protests 2011 in a larger map
With global government monetary policies to stimulate economies and U.S. dollar devaluation, the problem can only become worse.For a retirement investiment account such as 401K, IRA or a retiree's portfolio, here are 3 ways to fortify your portfolios:- Consider having some exposure in commodities. This can be achieved by broad base commodity index ETFs or mutual funds such as PowerShares Commodity Index ETF (DBC). You can even go more specific to have some exposure in agriculture commodities by using Powershares agriculture ETF (DBA). Both of these ETFs have been relatively stable recently, even in a serious stock market stress (S&P 500 SPX down 6% year to date).
- Consider exposures in foreign currencies. The safest way is through U.S. dollar bearish ETFs such as UDN (U.S. dollar down) or some individual currency ETFs such as CurrencyShares Australia dollar (FXA) or Canadian dollar (FXC).
- Consider some exposures in inflation protected bonds such as TIP or WIP (international inflation protected bond ETF). However, given recent runup on these ETFs, one should wait for a better entry point.
However how meaningful an investing theory is, one should still put this under an overall portfolio asset allocation framework. The following are some related investment portfolios/plans:Six Core Asset ETFs: it gives exposures in commodities through DBC.MyPlanIQ Diversified Core Allocation ETF Plan: diversified portfolios allow exposures in commodities, gold (GLD) and TIP/WIP.Permanent Portfolio ETF Plan: Permanent portfolios that have exposures in gold, silver (SLV) and hard assets. - 4 Portfolio Risks You Should Be Aware Of
05/17/2011
"Mother was wrong: What you don't know can hurt you", that is a quote from a Wall Street Journal article Stress-Test Your Portfolio, written by Jonathan Burton.
The following main risks were outlined in the article:
- Inflation and Interest Rates: inflation usually comes with rising interest rates. That could reduce the value of existing bonds and cash, thus purchasing power. This is especially painful for baby boomers and retirees. Best Bet:
- U.S. & international stocks (SPY) (EFA)
- commodities (DBC) (GSG)
- inflation-protected bonds (TIP)
- real estate investment trusts (IYR) (VNQ)
- cash.
- Disasters, War, Political and Economic Upheaval and Social Unrest: these unpredictable events are like black swans. Best Bet:
- Precious metanls like gold (GLD) or silver (SLV)
- U.S. treasuries (TLT), (IEF)
- Markets and Companies: individual companies or even sectors have risks specific to themselves. Best Bet:
- Diversification, no overlapped in terms of mutual funds, ETFs
- Playing It too Safe: to avoid risk is just not to join the game. However, you can miss major market advances and lose the purchasing power (even if you just want to preserve your capital). What is more dangerous for this type of investors is that they often sit on the sideline and capitulate at last, only getting into an already overheated market, resulting in big loss in a buy high, sell low fashion. Best Bet:
- Put enough money (such as five year expense) in a bank and then the rest into a diversified portfolio with a risk you can accept. Rebalance regularly.
The above risks are especially important in retirement investing: investors rely on their investments to fund their retirement needs.
The Six Core Asset ETFs is a Simpler Is Better (SIB) plan that has only SIX candidate ETFs that cover all of the major asset classes:
- U.S. Equity: Vanguard Total Stock Market ETF (VTI)
- Foreign Equity: Vanguard FTSE All-World ex-US ETF (VEU)
- Emerging Market Equity: Vanguard Emerging Markets Stock ETF (VWO)
- Real Estate Investments Trusts (REITs): Vanguard REIT Index ETF (VNQ)
- Commoditiies: PowerShares DB Commodity Idx Trking Fund (DBC)
- Total Bond Market: Vanguard Total Bond Market ETF (BND)
Check out its Strategic Asset Allocation Moderate and Tactical Asset Allocation Moderate model portfolios.
Or for more active investors, check out TD Ameritrade Commission Free ETFs that has over 101 ETFs as candidate funds.
Disclaimer: MyPlanIQ does not have any business relationship with the company or companies mentioned in this article. It does not set up their retirement plans. The performance data of portfolios mentioned above are obtained through historical simulation and are hypothetical.
Exchange Tickers: (VTI), (VEU), (VWO), (VNQ), (DBC), (BND), (GLD), (SLV), (TIP), (TLT)
Symbols: VTI, VEU, VWO, VNQ, DBC, BND, GLD, SLV, Portfolio Strategies & Asset Allocation, IRAs, Retirement Investing, Risk
- Inflation and Interest Rates: inflation usually comes with rising interest rates. That could reduce the value of existing bonds and cash, thus purchasing power. This is especially painful for baby boomers and retirees. Best Bet:
- Grantham Says Sell Risk Assets Now: What Are The Riskiest Assets?
05/12/2011
- Gold is Cool
04/21/2011
- Leuthold Fund Uses Gold, Silver and Real Estate for Inflation Hedging
04/13/2011
- Commodity Investing: Long Short (S&P Commodity Trend Indicators) vs. Long Only
03/13/2011
- Commodity ETFs: Does Everyone Need Energy Investment?
03/07/2011
- Commodity Trends: 2010 Year End Review
01/03/2011
- Silver and Gold Continued to Shine While Other Commodities Largely Stable
12/19/2010
- U.S. Stocks Strong; Other Bond Markets Continue to Slump
12/13/2010
- Broad Based Commodities Strong, Precious Metals Continue Correction
12/11/2010
- As Gold/Precious Metals Correct, Agriculture Commodities Stay Strong
12/03/2010
- Commodities Nov 29
11/30/2010
- Commodities Mixed -- Some up, Some down
11/23/2010
- Commodity ETFs Show Muted Downturn This Week
11/20/2010
- Commodity Indicators for Week of November 15th
11/17/2010
- Amber Waves of Pain: Commodities ETFs Are Killing Investors
07/26/2010
