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Gary Gordon

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  • How ETF Investors Might Get In On Single-Family Rentals [View article]
    Alan,

    >>Jim Cramer lamented last year over the challenges...

    I'm sorry, unless I'm writing about flip-flopping and/or questionable Bear Stearns comments, I'm not particularly interested in Cramer.

    >>I know you cited it for correlation reasons,
    >>but recent correlation might not hold in the future.

    Correlation is the only reason... but it is not one to be overlooked. What's more, I never buy-n-hold... I am not looking for 3-year or 5-year correlations. Besides, they wouldn't exist since the potential asset class is brand new in the REIT world.

    >>Now, those other two REITs you mentioned
    >>I need to look into those...

    A handful of individual REITs, mostly recent IPOs. They are true to the space, yet individual securities do not offer diversification. Moreover, 90% of all IPOs will close below the original offer price with 18 months.

    In all, there are no perfect solutions here. I gave a few ideas, warts and all.
    Jan 11 11:08 AM | 1 Like Like |Link to Comment
  • Abandoning High Yield Bond ETFs? Rethink Your Premises [View article]
    Cranky... appreciation.

    Flash... you wrote, "people have predicting a top in bond for years." Precisely. And that prediction has failed miserably. Diversified high yield corporates continued to perform.

    High Oak... you wrote, "when spreads compress..." But that hasn't happened significantly... not yet. When they do, nearly all yield-oriented income assets will be hurt. If you read my article, I made the points that: (a) one shouldn't add to or abandon intermediate high yield, (b) the markets themselves will tell you when to lighten up on intermediate high yield, (c) one should consider three different investment possibilities rather than adding to intermediate high yield (i.e., BSJH, AUNZ, PFXF).
    Jan 8 11:34 AM | 1 Like Like |Link to Comment
  • If You Insist On Investing In A European ETF, Hedge Against The Euro [View article]
    Paulo,

    I agree wholeheartedly. As you know, I am not and have not been investing in Europe directly; I am investing in Asia Pacific ETFs.

    That said, ETF investors who do choose to invest in Europe need to understand their alternatives. Blindly choosing an unhedged single country fund like France (EWQ) is far riskier than a hedged regional fund like HEDJ.

    Gary
    Nov 21 11:09 AM | Likes Like |Link to Comment
  • Are Treasury Bond ETFs Forecasting An Ohio Recount? [View article]
    User 447425,

    The answer to your question(s) is summed up in the final two paragraphs. Here you go:

    "In my estimation, however, both the election and the fiscal cliff will be resolved. What’s more, with leaders around the globe demonstrating strong biases toward fiscal and monetary easing — both conventional and unconventional — risk assets will find a way to move higher.

    If the markets do pull back sharply, individual investors with high cash positions should consider ETFs like SPDR Retail (XRT) and Vanguard Dividend Appreciation (VIG). Buying the pullback ensures a lower entry point, and stop-limit loss orders protect against extreme downside risks from there."
    Nov 6 11:14 AM | Likes Like |Link to Comment
  • Economically Sensitive Stock ETFs Have Struggled Since The Fed's Mortgage-Backed Bond Initiative [View article]
    User 447425,

    >>I do not think QE3 was ever meant to affect corporate
    >>profitability, sales or new hires.

    Well, then, you are directly contradicting what Fed Chairman Bernanke has said about the purpose of QE3; that is, the economy is weak and requires stimulus to positively impact the employment picture. Moreover, employment is part of their dual mandate.

    >>The whole point of QEinfinity is to simply force capital to
    >>stay in "risk on" investments.

    Again, it is not the job of the Fed to push stocks and riskier assets higher. Obviously, they recognize (and surely discuss) the probability that pushing bond yields lower reflates demand for riskier assets. They are hoping for a "wealth effect" in home prices and stock prices because that would benefit the overall economy (new hires, sales, corporate profitability, etc.).

    Gary
    Oct 22 12:09 PM | Likes Like |Link to Comment
  • QE3 Continues To Rev Up Emerging Market Corporate Bonds And Currencies [View article]
    Mr. Crouch,

    Your sarcasm notwithstanding, you misinterpreted the point of this article. You've taken unnecessary and unfounded shots at my "aim" as well.

    QE central bank intervention(s) are bad for the long-term well-being of the developed economies that employ them. Many emerging market economies, particularly those that are less dependent on exports, will be the benficiaries of the U.S. Federal Reserve's dollar-devaluating "wealth effect" efforts. It follows that emerging market sovereign debt, EM corporate debt, EM currencies and proxies like gold will benefit investors over time.

    If you believe that investors cannot benefit from the poor decisions of governments, or if you believe that I have not identified the assets that will benefit from QE1,2,3,4,5, you are entitled to your opinion. However, you're not entitled to mischaracterize mine.

    As for your ill-informed statement on my article's purpose, I do not have a financial arrangement with WisdomTree or any other ETF provider. Legal disclaimers are necessary for those of us who own successful SEC-registered investment advisers and who manage substantial amounts for families across the country.
    Oct 15 12:19 PM | 1 Like Like |Link to Comment
  • Why Mortgage-Backed Bond ETFs Will Increase Your Net Worth [View article]
    Jerbear,

    Yes, you are missing the point. Regular readers of this column can see that I have talked about REM (perhaps ad nauseum) and profited enormously from REM... all year long.
    http://seekingalpha.co...

    This article's point is that if you want Ben Franklin-like certainty in your portfolio, then buy what Ben Bernanke is buying: mortgage-backed bonds. NLeeson hit the nail on the head.

    G
    Sep 25 12:03 PM | Likes Like |Link to Comment
  • Prepping Your Portfolio For The Fed's 'Work In Progress' [View article]
    Shortie Long wrote, "Besides that, what makes you think business leaders have all the answers?"

    I don't believe anyone has all the answers, but the CEOs and executives of the S&P 500 corporations sure have the answers on what it will take for them to hire more people for their own companies. Why? Because they are the decision makers on when and how many to hire at their own corporations.
    Sep 12 10:45 AM | Likes Like |Link to Comment
  • The Secret To Surviving Today's Unpredictable Stock Market [View article]
    E,

    Indeed, there are many assets that investors must consider (other than stocks) to thrive and survive. Yet a 71% weighting in bonds and quasi-bonds (utilities) -- TIP, TLT, XLU, HYG, MBB -- is an egregious example of 20/20 hindsight.

    I am not, nor have I ever been, a buy-n-holder. So there are times when my client accounts will be exceptionally income-oriented. In fact, there are times when I may hold a similar "risk-off" aggregation.

    However, your article uses a buy-n-hold approach with a multi-year example of equal-weighted portfolios with zero changes along the way. When it comes to buy-n-hold, 14% in broad market U.S. stocks is super light... except for perma-bears.
    Aug 31 01:17 PM | 2 Likes Like |Link to Comment
  • Investing In 'Risk-Neutral' Inflation-Fighting ETFs [View article]
    Fludolph,

    >>When the economy recovers sufficiently and inflation starts to build,
    >>the Fed can remove that money by selling the bonds it bought

    I suppose it would be nice to believe that this was even possible. Unfortunately, the Fed/intragovernmental holdings of $6.3 trillion represent 40% of the debt. Even the Fed alone with $1.7 trillion is 11% of the debt.

    As the president of a Registered Investment Adviser with the SEC, I can assure you that it is no small task to sell 1/10 or even 1/100th of anything... not without moving the price of the entire market. It follows that the Fed will not be able tame inflation when the economy recovers sufficiently, not unless it is remarkably assertive with a quantitative tightening program. And does anyone really believe that the Fed will do that?

    Even if the Fed wanted to tackle inflation with the same gusto as it is doing in its role as the buyer of first resort on treasury bonds, it would have to risk crippling rates. It may also have to contend with other rate rising factors, perhaps China/Japan wanting to reduce holdings or a predictable burst of the treasury balloon or a Euro-style California bailout by the U.S.. government.

    Nope... the Fed will not be able to sell the bonds as you suggest, let alone take a truly aggressive tightening stance when the economy grows "sufficiently." They will accept inflation because this Fed will not risk being blamed for snuffing out a recovery and causing yet another recession with aggressive monetary tightening policy... they will opt for the employment side of the dual mandate.
    Aug 29 12:15 PM | 1 Like Like |Link to Comment
  • Will Expensive European ETFs Continue To Outperform Cheap Emerging Market ETFs? [View article]
    I think that is the point. The Bloomberg P/E takes into account the E for the year 2012. The lower the E, the higher the P/E for European equities.
    Aug 23 10:42 AM | Likes Like |Link to Comment
  • A Stealth Recovery In Emerging Asian ETFs? [View article]
    Donna

    VWO/EEM represents cyclicality of energy and materials (a.k.a. "the global growth story"). They work best in a weak dollar, strong commodity demand environment. It is not always appropriate for emerging market exposure.

    Meanwhile, FXI is the worst of the China funds and it has been many years since EFA made any sense for any investors.

    It is not clear whether or not you understand volume, because any fund with $1,000,000 in average dollar volume is remarkably liquid. EPI (India), EWM (Malaysia), IDX (Indonesia), HAO (Small Cap China) are absolutely fine with regard to liquidity issues.

    Jake, I am pretty sure that you would regard the SPDR S&P 500 (http://bit.ly/qNUi50) as a country fund... one that is not speculative. And I doubt that you would describe EWA (Australia) or EWC (Canada) as speculative either. Yet the fact remains, for the better part of the last 5 years, EWM (Malaysia) has been LESS VOLATILE than the U.S, Germany, France, Canada or Australia. I would say that "speculative" is in the eye of the beholder.
    Aug 1 05:58 PM | Likes Like |Link to Comment
  • Why Money Managers May Liquidate The iShares Barclays 20+ Year Treasury Bond Fund [View article]
    Gratian,

    Yes, the Fed believes Europe's recession may hurt domestic employment. They believe Washington is dysfunctional. And they believe that squashing interest rates can benefit real estate/wealth effect/hiring.

    I am neither interested in purchasing treasuries nor shorting them. I have concentrated on the middle of the risk spectrum.
    http://bit.ly/OwBIrJ
    Jul 19 05:02 PM | Likes Like |Link to Comment
  • Why Money Managers May Liquidate The iShares Barclays 20+ Year Treasury Bond Fund [View article]
    SG,

    You are misinterpreting. I did not say that QE3 would be a good thing for Treasury bonds. I said that the anticipation of QE3 over the next 6 months is the reason that Treasury bonds are thriving... a la buy the rumor sell the news.

    The Fed signalled QE for many months prior to every act from QE1, QE2, Op Twist and the prospect of QE3. Treasury bond prices have always gained on the anticipation that the Fed will purchase... a la buy the rumor. Those who did so profited handsomely.

    Once the Fed actually acts, money managers have sold the news. They shifted to riskier stock assets. And they waited for a better entry point on treasury bond prices.... typically a point where a QE Policy was coming to an end.

    In other words, the markets themselves often force the Fed's hands. Bond markets tell the Fed where it needs to go, stock markets do the same with panicky corrections. The Fed signals that it might, it stands ready, it may in fact... and then the Fed gives the markets what they clamor for.

    In all, the Fed is the largest owner of treasury bonds because of QE policies... more than China or Japan or the U.S. investor. I think it follows that the Fed's extraordinary level of bond ownership tells you that, at least since 2009, it has benefited treasury prices (lower yields). In the longer-term, however... like all investing... the same policies (or anticipation of them) that once helped... can become a huge detriment
    Jul 19 02:31 PM | Likes Like |Link to Comment
  • Ultra-High Yield ETN Investing In Business Development Companies [View article]
    GCmag... The article is intended for exchange-traded fund (note) enthusiasts. PSEC is getting whacked for issuing more stock today, but that may make it more attractive after a huge run-up.

    J... you have to be a shareholder of record on the "record date."
    Jul 11 12:41 PM | Likes Like |Link to Comment
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142 Comments
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