December 19, 2022: Newsletter Collection Update

Dec 20, 2022 | Feature, Newsletter

Re-balance Cycle Reminder All MyPlanIQ’s newsletters are archived here.

Regular AAC (Asset Allocation Composite), SAA and TAA portfolios are always rebalanced on the first trading day of a month. the next re-balance will be on Tuesday January 3, 2023. 

As a reminder to expert users: advanced portfolios are still re-balanced based on their original re-balance schedules and they are not the same as those used in Strategic and Tactical Asset Allocation (SAA and TAA) portfolios of a plan.

We wish everyone a joyous Holiday season and a happy New Year!

Newsletter Collection Update

Latest update on12/19/2022

Highlighted are the recent articles.

We have published numerous newsletters over the years and many readers have asked us to categorize and summarize our previous newsletters as they tend to cover various topics. We believe this is a good idea as many of them provide useful information that can be useful for both new and old users. We highly encourage users to read these newsletters as understanding many issues and our methodology is an inherent part of using our service. In the following, we select and list some newsletters in each category.

Portfolio Management

Asset Allocation and Other Investment Strategies

Asset Allocation Composite:

Strategic:

Tactical

Asset Behavior

Strategic and Timing

Fund Selection

Core Satellite and Multiple Strategies

Momentum Strategies and their behavior. How various asset allocation strategies work in different market cycles

Strategy and Portfolio Evaluation

Risk Parity, Four Pillar and Permanent Portfolios

More newsletters can be found in these articles:

Portfolio Rebalance & Daily Management

Risk Management & Investor Behavior

Portfolio risk management techniques and issues.

Investment Philosophy

Fixed Income, Dividend, Total Return Bond Funds & Conservative Allocation

The following newsletters address many concerns for retiree, conservative and income investors.

Fund Review

Factor ETFs

General mutual funds and ETFs

Financial Planning & Retirement

Cash Management

Features & System Q&As

These newsletters address new features and how to for our system usage.

Existing Portfolio Performance Reviews

In general, we review various portfolio performance in each newsletter. However, you can get latest up to date  performance result and comparison by clicking on links below portfolio comparison tables listed in our quarterly or annual review newsletters:

Portfolios suggested by advisors and brokerages

As we just had a major rebalance last week, it’s pertinent to review the latest market and economy trend.

Market overview

In its latest meeting, the Federal Reserve made it clear that their recent interest hikes are (far) from over. Stocks have been under pressure again. In the final weeks of 2022, investors seem to be very concerned about the risk of a recession in the coming year. In fact, retail sales indicator in November was down from October and from November last year. As November is traditionally a stronger month than October, this does not bode well with the optimistic view:

We are also seeing some slowdown in industrial production in November. Other economic indicators are still mixed.

At the moment, markets are struggling to find its direction. Regardless, as always, we advocate a risk managed approach and call for staying the course:

  • For strategic allocation (buy and hold) investors, ignore the current market behavior. Remember, as what we have emphasized numerous times, when you choose and commit to a strategic portfolio, you essentially know and commit that your investment horizon (or the time you need to utilize this capital) is 20 years or preferably much longer given the current high valuation. As we pointed out, if your investments are those diversified (index) funds such as an S&P 500 index fund (VFINX, for example), you know your money is in some solid ‘business’ that eventually (20 years later and preferably many more years later) will deliver some reasonable returns. As long as you are comfortable with this thesis, you should sit tight and forget about the current gyration.
  • For tactical investors, again, you have to ignore the current market noise. Furthermore, you should follow your strategy rigorously, especially in a time like this. Human emotion, both optimistic and pessimistic, and human desire, both greedy and fearful, are your worst enemies. This has been shown to be true time and time again.

Stock valuation has dropped and now valuation is becoming less hostile. However, it is still not cheap by historical standard. For the moment, we believe it’s prudent to be extra cautious. However how serious a correction might be, we have confidence in the US economy in the long term and thus in the stocks in aggregate. We just need to manage through interim losses carefully.

We again would like to emphasize that for any new investor and new money, the best way to step into this kind of markets is through dollar cost average (DCA), i.e. invest and/or follow a model portfolio in several phases (such as 2 or 3 months) instead of the whole sum at one shot.

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