P/E Reversals May Identify Sector ETFs With The Most Promise In 2012 [View article]
User447425,
>>Since financials make up 20% approx of the SPY 500...
No, they make up about 13.8%.
>>how do financials grow earnings 20 percent in 2012?
They won't... nor do they need to. The expected profit growth for financials is 12.7% in 2012, slightly higher than than the S&P 500's weighted annualized profit projection of 10.2%.
Jobs Picture Shows Little Improvement: Stick With Dividend ETFs [View article]
SHedges,
I think you mean that you have a problem with my conclusion. You haven't disagreed with the notion that labor participation rate is a critical indicator of the direction and/or health of employment trends. On the other hand, you doubt whether or not Dividend ETFs are the best investment... considering the circumstances.
That said, my argument is not that dividend stocks make the most sense in an unstable economy. Rather, I have suggested that they work best in a muddle-through environment of slow growth. And, the Dividend ETFs with zero or limited financial exposure provide a small measure of protection in a system-wide meltdown.
Small caps perform best in oversold recovering markets (2009) and Fed-propelled stimulative markets (2010). The Fed didn't have the same QE mandate in 2011... only more of the same with an Operation Twist. The slow growth, muddle-through environ of 2011-12 is better for companies maintaining and/or raising their dividends.
Portfolio Planning For 2012: Avoiding The Big Loss [Podcast] [View article]
Nobody should bet the farm on any investment. That's why everyone should endeavor to diversify a portfolio.
That said, U.S. stocks hit 10-year lows in March, 2009. 85% gains since hitting those lows are quite attractive.
One can never be certain when markets will turn. Yet most of the damage to Chinese equities have already occurred in a ruthless inflationary bear market. With P/Es below 10 and with stimulative monetary/fiscal policy, a bull market up move is not far off.
Gary Gordon Positions For 2012: Shunning Developed World Treasuries In Favor Of Emerging And Corporate Debt, MLPs [View article]
No, I am not calling for a CA default. In fact, In fact, I fully expect that, when the time comes, the U.S. will bail out CA. So the investments people are making should be fine... in the end.
That said, asusming a bailout is inevitable is as silly as buying Italian bonds. I am not doing it... are you?
It won't be a quick path to the inevitable bailout that Cali will require. The citizens of the other 49 states will not give an unconditional green light to Congress to dump money into a can't-stop-spending state.
The fight will drag on... much like it did with Greece, much like it is with the other PIIGS. The uncertainty isn't worth the exceptionally high probability that CA will get its money when push comes to shove. Ergo, buy diversified national munis and clip the coupon for the federal tax break... forgo the state tax break.
7-ETF Portfolio For The Skeptical, Bearish Crowd [View article]
The "average" assumes equal weighting. But remember, I am not recommending an ideal portfolio when there are so many different types of investors. Moreover, I am an active manager who does not believe in buy-n-hold.
That said, the purpose here is to show that conservative investors can reduce portfolio risk and still reap rewards. Most combinations of utilities, pipeline partnerships, REITs, high yield bonds, dividend stocks and investment grade bonds are going to work for you.
AMJ is an exchange-traded "note," so it goes on a 1099 and avoids the K-1s as well: http://bit.ly/reLbXJ
AMJ does introduce the "credit issue," but if you're really afraid that JP Morgan Chase won't honor its AMJ commitment, you shouldn't be invested in market-based securities at all. For that matter, you should avoid money market funds.
ETFs For A Market With No Definitive Trend In Place [Podcast] [View article]
*Hysteria,
SA chose the title. If one listens to the podcast, one would hear my thoughts on the best way to deal with the current "trading range" market.
It is only "trendless" in the sense that the bull market is on hiatus and a new bear market has not been established. Everyone should understand that many institutions and hedge funds are using S&P 500 1096-1233 for trading purposes... and that's precisely the difference between a 10% correction and a new bear (-20%).
Regarding high yield corporates in HYG, I completely agree.
2 Approaches for Investing in Markets Experiencing Record Volatility [Podcast] [View article]
I can't tell you what to do... but there's an exceptionally high probability that others may do exactly that. (Keep in mind, the leveraged/inverse vehicles are trading tools with daily compounding... not buy-n-hold tools with annual compounding.)
Fear / Risk ETFs Simultaneously Hit 52-Week Highs [View article]
Dear Outcast,
Not only did I pay attention to the "flash crash," I successfully sidestepped troubles by employing stop-limit orders on very liquid positions. If an investor understands the difference between a stop-market order and a stop-limit order, and if he/she only uses highly liquid ETFs, the problems are few and far between. While not the only method of risk reduction, it is worthy of use by those who implement them correctly.
In fact, as the president of a Registered Investment Adviser with the SEC, we provided hundreds of clients with remarkable peace of mind during the "flash crash." Not only did we raise cash levels from stop-limit orders that occurred well before the Flash Crash (i.e., the event happened after the market was already pulling back significantly), but we purchased shares of favorite ETFs at much lower prices with that cash.
Lastly, ETF buys/sells that occurred within a particular window during that day were reversed... as if they didn't occur. Those who bought or sold ETFs in that time window were not permitted to benefit or get burned in that window... the trades of ETFs were effectively wiped out.
In complete contrast, market order trades on individual stocks of name brand companies like Procter & Gamble went through. Those who suffered the humiliating losses you speak of had market orders on individual companies, not ETFs. The ETF orders were reversed.
P/E Reversals May Identify Sector ETFs With The Most Promise In 2012 [View article]
>>Since financials make up 20% approx of the SPY 500...
No, they make up about 13.8%.
>>how do financials grow earnings 20 percent in 2012?
They won't... nor do they need to. The expected profit growth for financials is 12.7% in 2012, slightly higher than than the S&P 500's weighted annualized profit projection of 10.2%.
Jobs Picture Shows Little Improvement: Stick With Dividend ETFs [View article]
I think you mean that you have a problem with my conclusion. You haven't disagreed with the notion that labor participation rate is a critical indicator of the direction and/or health of employment trends. On the other hand, you doubt whether or not Dividend ETFs are the best investment... considering the circumstances.
That said, my argument is not that dividend stocks make the most sense in an unstable economy. Rather, I have suggested that they work best in a muddle-through environment of slow growth. And, the Dividend ETFs with zero or limited financial exposure provide a small measure of protection in a system-wide meltdown.
Small caps perform best in oversold recovering markets (2009) and Fed-propelled stimulative markets (2010). The Fed didn't have the same QE mandate in 2011... only more of the same with an Operation Twist. The slow growth, muddle-through environ of 2011-12 is better for companies maintaining and/or raising their dividends.
Gary
Portfolio Planning For 2012: Avoiding The Big Loss [Podcast] [View article]
That said, U.S. stocks hit 10-year lows in March, 2009. 85% gains since hitting those lows are quite attractive.
One can never be certain when markets will turn. Yet most of the damage to Chinese equities have already occurred in a ruthless inflationary bear market. With P/Es below 10 and with stimulative monetary/fiscal policy, a bull market up move is not far off.
Gary Gordon Positions For 2012: Shunning Developed World Treasuries In Favor Of Emerging And Corporate Debt, MLPs [View article]
Gary Gordon Positions For 2012: Shunning Developed World Treasuries In Favor Of Emerging And Corporate Debt, MLPs [View article]
That said, asusming a bailout is inevitable is as silly as buying Italian bonds. I am not doing it... are you?
It won't be a quick path to the inevitable bailout that Cali will require. The citizens of the other 49 states will not give an unconditional green light to Congress to dump money into a can't-stop-spending state.
The fight will drag on... much like it did with Greece, much like it is with the other PIIGS. The uncertainty isn't worth the exceptionally high probability that CA will get its money when push comes to shove. Ergo, buy diversified national munis and clip the coupon for the federal tax break... forgo the state tax break.
7-ETF Portfolio For The Skeptical, Bearish Crowd [View article]
That said, the purpose here is to show that conservative investors can reduce portfolio risk and still reap rewards. Most combinations of utilities, pipeline partnerships, REITs, high yield bonds, dividend stocks and investment grade bonds are going to work for you.
Allocating To MLPs Using Exchange-Traded Products [View article]
That said, if you like the space, and prefer a diversified vehicle with less tax headaches, AMJ and AMLP do the trick.
AMLP does avoid the K-1s:
http://bit.ly/q6TUPB/
AMJ is an exchange-traded "note," so it goes on a 1099 and avoids the K-1s as well:
http://bit.ly/reLbXJ
AMJ does introduce the "credit issue," but if you're really afraid that JP Morgan Chase won't honor its AMJ commitment, you shouldn't be invested in market-based securities at all. For that matter, you should avoid money market funds.
ETFs For A Market With No Definitive Trend In Place [Podcast] [View article]
SA chose the title. If one listens to the podcast, one would hear my thoughts on the best way to deal with the current "trading range" market.
It is only "trendless" in the sense that the bull market is on hiatus and a new bear market has not been established. Everyone should understand that many institutions and hedge funds are using S&P 500 1096-1233 for trading purposes... and that's precisely the difference between a 10% correction and a new bear (-20%).
Regarding high yield corporates in HYG, I completely agree.
Gary
The Keys To Successful Money Management With ETFs [View article]
$250,000 in average "dollar" volume, not share volume. ALD has an average dollar volume of $9,000,000.
Best,
G
2 Approaches for Investing in Markets Experiencing Record Volatility [Podcast] [View article]
Without Bailing Out European Banks, These ETFs May Be Toxic [View article]
The list in this article only included stock ETFs. And, not all of the stock ETFs mentioned above have eurozone exposure. "Most" do.
G
Indiscriminate Selling Stimulates Huge Demand for Yield-Oriented ETFs [View article]
Fear / Risk ETFs Simultaneously Hit 52-Week Highs [View article]
Not only did I pay attention to the "flash crash," I successfully sidestepped troubles by employing stop-limit orders on very liquid positions. If an investor understands the difference between a stop-market order and a stop-limit order, and if he/she only uses highly liquid ETFs, the problems are few and far between. While not the only method of risk reduction, it is worthy of use by those who implement them correctly.
In fact, as the president of a Registered Investment Adviser with the SEC, we provided hundreds of clients with remarkable peace of mind during the "flash crash." Not only did we raise cash levels from stop-limit orders that occurred well before the Flash Crash (i.e., the event happened after the market was already pulling back significantly), but we purchased shares of favorite ETFs at much lower prices with that cash.
Lastly, ETF buys/sells that occurred within a particular window during that day were reversed... as if they didn't occur. Those who bought or sold ETFs in that time window were not permitted to benefit or get burned in that window... the trades of ETFs were effectively wiped out.
In complete contrast, market order trades on individual stocks of name brand companies like Procter & Gamble went through. Those who suffered the humiliating losses you speak of had market orders on individual companies, not ETFs. The ETF orders were reversed.
Debt Ceiling ETFs: A Different 'Gang of Six' [View article]
Not to get "picky," but these aren't picks. At the time of the article, these were the returns for the ETFs in the table.
Best,
Gary
The Real Implications of Risk On, Risk Off ETF Investing [Podcast] [View article]