Investment

» smile_2quick1 - Hedging strategies - Rebalance strategy during the cycle bull

Don't you just hate it when the market puts you ahead of your annual growth target, and the market takes it all back during a bull correction.

.

I am back above where I was on May 8th as of September 20 and as the market kicks into gear, I have a watermelon smile. I bought more equities as we got down to the lows of this last correction in June.

Is it now time to take some profits? That is a question many investors are faced with. My allocation is getting a little out of whack on the equity side. Best advice is let your winners run. October will be fine as long as earnings come in at or above expectations with no great divergence in warnings. Let 'er run...

**************************

Also, I still need to add another column to the Spiral 5b report I am tracking for my own edification and back test an Asset allocation/Rebalance model as suggested in my last paragraph here: http://investment.suite101.com/discussio...

Good Article by Kirk here: http://www.suite101.com/article.cfm/inve...

re: Spiral reports - I think I need to add one more stat to look at the %win/loss of the expected buying pressure/selling pressure dates - some have referred to this as a DDD (drop dead date), but it is not really since the Spiral model is in GZs words a reactive model not a predictive model. So I will refer to them as ESPD (expected selling pressure dates) & EBPD (expected buying pressure dates).

Spiral 5b side note: But for the 9/25/06 ESPD, the 5b model would still be racking up gains since the reversal price on 9/22/06 was not exceeded at the close. So this additional stat should enhance the info provided in these reports. Hopefully I have done them in such a way as to be totally objective so anyone can go back and recreate as a critical check. I will post the two Spiral reports as appropriate after GZ returns from vacation.

-- posted by smile_2quick1

» SteveT - YTD update

.
With the end of the third quarter thought I'd chime in on how I am doing YTD. On the close September 12th I adjusted my allocation. I was at 84% equities and the balance in fixed. The equity portions had gotten over weighted on the International side, my plan had been to be at 35% International. I decided to trim that to 30% of equities and most of the proceeds went into cash with a small amount in US, most large cap S&P 500 index. This brought me down to my target of 80% total equities.

I am very comfortable with this move since I did raise some cash to buy more bonds if the prices become attractive and if we get a large equity correction I can buy more there to get my allocation in line. Should we keep going up on the equity side I'll still enjoy nice gains there as well. I feel like I am ready for what ever Mr. Market throws my way, within reason.

BTW as of the end of September my entire investment portfolio return is 10.77% YTD. This includes equities, bonds, and cash. Doesn't include money market rainy day emergency savings or home equity.

-- posted by SteveT

» runner26 - YTD update

In response to YTD update posted by SteveT:

I am conservatively invested as I am retiring this year, and have critical mass.

I have 17.41% in MM and CD's yielding 5 to 6%.

I have 49.47% in equities (after a bit of profit taking last week), large/medium/small cap, weighting heavier to large and value at this time. (of that, 35.66% is domestic and 13.81% is foreign).

I have 33.12% in bonds (Vanguard GNMA's, Vanguard Total Bond and Vanguard Short Term Investment Grade, I-bonds, Treasuries).

Total return YTD through September is 6.722%.

Real estate is not included.

-- posted by runner26

» allancoleman - YTD update

In response to YTD update posted by runner26:

Congradulations on making critical mass , runner26 , and your retirement this year . I still can't hardly believe these many years later since i retired in 2000 , how nice it is . Your year to date return is on track to do well by year's end . One of the reasons i went to a Total portfolio that took into account my real estate values was because i was , and still am , selling real estate and have thus far lived entirely off those sales with no withdrawals yet from my invested deferred or taxfree Roth accounts . I also wanted to set up my retirement portfolio so that it accounted for my living expenses too . Didn't think it made any sense in having high performances in my invested portfolio if i was going to spend most of it on my life style . So i wanted a portfolio where i could track all my investment sectors , real estate too , and also account for my living expenses in my performance of that portfolio .

I'm also using a " bucket number one " strategy with at least a year's worth of living expenses in it so that i don't have to be concerned about what assets to sell to generate living expenses .

Your returns sound excellent too , SteveT . Since my money markert savings and taxfree accounts are largely my bucket number one and i wanted to see how well my Total portfolio performed with the steady decline of those accounts for living expenses , i account for them . If my real estate were only my home equity , i probably would not account for it in any portfolio , but since my real estate generates almost my total income to date all these years later since i retired in 2000 , i account for it .

-- posted by allancoleman

» runner26 - YTD update

In response to YTD update posted by allancoleman:

Allan, thanks for the congrats. Hope I enjoy retirement as much as you. I still have many new places to explore, so don't know how soon I'll get back to Kona, but I remember I had fun there. The big island had a lot of great sights and activities. What a great place to own a residence and be able have an extended stay.

The only freaky thing was all the cockroaches in the rental car. When I came out of the restaurant in the evenings and opened the car door, they were everywhere and ran when the light came on. I remember driving sometimes after dark with the car light on just to keep them in hiding.

-- posted by runner26

» allancoleman - YTD update

In response to YTD update posted by runner26:

We had a similar experience with a rental vehicle when we visited Maui a few years ago . I have an old team mate from the company for whom i worked and retired who is now a resident on Maui . On a week trip to visit him , we went to pick up his kid at school and put him in the back seat of my rental vehicle . Unknown to us , the last renters of the car had spilt a soda pop in the back seat and a large nest of ANTS has set up their home there and started to argue with this young kid when he decided to sit over their home . It took awhile for us to remove the seat , get rid of the ants and go on with our drive . Upon turning the vehicle in at the rental car counter when i turned the vehicle in and i told them about it , they acted like it was ' no big deal ' . Bugs in the tropics are numerous and can be large .

Yes , we are fortunate to have purchased a second home ( condo ) on the Big Island years ago when they were much less expensive . However i encourage those interested to visit the Big Island and continue to look for a place to buy because prices are still much cheaper there than on any of the other islands . Especially on the windward or Hilo side .

Retirement is great and i'm so glad it's working as i had planned . Now i'm following Bob Brinker advice that after an investor has achieved critical mass to focus on one's health . Then i can truely enjoy my critical mass .

-- posted by allancoleman

» smile_1 - Hedging strategies - Rebalance strategy during the cycle bull

In response to Hedging strategies - Rebalance strategy during the cycle bull posted by smile_2quick1:

smile said: "Don't you just hate it when the market puts you ahead of your annual growth target, and the market takes it all back during a bull correction.

I am back above where I was on May 8th as of September 20 and as the market kicks into gear, I have a watermelon smile. I bought more equities as we got down to the lows of this last correction in June.

Is it now time to take some profits? That is a question many investors are faced with. My allocation is getting a little out of whack on the equity side. Best advice is let your winners run. October will be fine as long as earnings come in at or above expectations with no great divergence in warnings. Let 'er run..."
______________________________

Well, I'm there again.

There, now, is a little different from last time when at May 2006 I was $40,000 above my June 2006 net worth goal.

This time There is, I am now above my June 2007 goal. Last time I was in this position May 2006 I rode er down and bought more and am better for it.

This time I'd like to say I am hedged or have taken profits but neither is the case. As stated above Let 'er run...

My reasons for not cashing in my winners are:

The danger zones which existed in May of this year don't seem relevant now - we now have lower oil, commodity specs, and housing flippers have taken a bad beating thanks to the Fed.

The Fed did a nice job of taking its foot off the brake - coasting to a soft landing, sustained corporate profits and if we make it through earnings season unscathed we are looking at the seasonal period with many investors still waiting to board this bull run.

Another 500 points up on the dow with the major indices following will begin to gnaw on those who were left at the bull train all aboard gate.

If we correct from here I will be buying more.
_________________

I'm still testing neural software and have developed a forecasting model and am tweaking it down to .001 minimum error rate.

-- posted by smile_1

» allancoleman - YTD update: +13.1%

In response to YTD update: +13.1% posted by Kirk:

Appreciate you letting us know that your returns don't include real eatate values .

But it is nice to see , if i'm reading your numbers right ? , that it does include your living expenses . Which I think is important for retirees living out of their critical mass to calculate . If i'm reading it right , your return with your living expenses figured in is 11.2% so you're taking roughly a 2% withdrawal rate from your critical mass . My withdrawal rate is similar .

-- posted by allancoleman

» allancoleman - YTD update: +13.1%

In response to YTD update: +13.1% posted by Kirk:

Appreciate the correction data . When i worked and my employer dumped a thousand or so a week into my personal checking account , my ' Invested ' portfolio meant something different than it does now that i have to replace that deposit to my personal checking accounts with withdrawals from my ' Total ' portfolio . And having real estate liquidation sales has kept me from having to take any withdrawals from either my deferred ( 401k or IRA ) accounts or my taxfree ( Roth ) accounts allowing those to continue their double schedules with my NOT getting into them yet because selling real estate has paid for every thing including extensive Roth conversions since I retired in 2000 .

My real estate ' noise ' is quite large so if i don't account for it somehow , it can have a large effect on my portfolio returns . Especially this year where i've had quite large real estate expenses for increased taxes due to increased valuations and development costs associated with future real estate sales . I'm spending quite a bit of money and time now developing real estate that I won't sell until future years . That's why I'm making more real estate trips now for other things besides just a planned annual sale .

It's all a part of making money anyway you can - Stock market , Bond market , Real estate , etc .

-- posted by allancoleman

» bob90245 - Train Leaving the Station?

In response to YTD update: +13.1% posted by Kirk:

Smile wrote: Another 500 points up on the dow with the major indices following will begin to gnaw on those who were left at the bull train all aboard gate.

Kirk wrote: Like Smile, I see people just starting to get back into the markets as they see the DOW make new highs.

Well, I have my "explore" impatiently waiting for the Fall dip. So rather than wait for Sy's MACD signal or November, I'm starting to put my "explore" back into stocks. I'll post an update for my Asset Allocation in the next week or two.

-- posted by bob90245