I write The Kelly Letter, a weekly review of the financial markets that runs three price rebalancing strategies. Each uses one stock fund and one bond fund, makes one switch per quarter, and beats the market with no forecasting and no stress from indecision. Such rational price reaction is the way to win at this business. In 2016, the letter returned 18.9% compared with 12.0% for the S&P 500, both on a total return basis. To see longer-term performance, please visit http://jasonkelly.com/resources/strategies/ The letter's strategies are perfect for your retirement accounts. Switch to rational reaction and never look back at pundit guessing games. Not one of them knows what will happen next. With my approach, you won't care because your new system will react appropriately to whatever unfolds. In addition to writing The Kelly Letter for delivery to subscribers every Sunday morning, I'm the author of The 3% Signal, which introduced the Sig strategy framework mentioned above. My nine other books include The Neatest Little Guide to Stock Market Investing, a BusinessWeek best seller now in its fifth edition; and its companion volume, Stock Market Contest. I hope to welcome you to The Kelly Letter. Please subscribe at: http://jasonkelly.com/letter/
Retired. Manage our portfolio, which is comprised of stock, REIT and bond mutual funds and ETFs, plus about 10 percent in dividend-paying stocks. Diversified among domestic growth, blend and value stock funds, plus international stock and bond funds. Portfolio is more than 70 percent equities, a bit more than 20 percent bonds, five or so percent cash. During 2007 prior to retirement in 2008 the portfolio moved from 80 percent stocks to nearly 70 percent bonds. Fortuitous timing. Vietnam veteran. 25 years of service to U.S. military.
My early success involved as much luck as skill when my then-broker back around the late '80s guided me to Telefonos de Mexico, which I first bought for 29 cents a share. The stock eventually took off -- wow, was I surprised -- and I'd made my first boodle. I sold it all and created what my broker jokingly called my own mutual fund -- all big cap dividend payers. I also added to the bond holdings I'd already started building. I reinvested all the dividends and cap gains. I eventually sold all but my original shares and invested the resulting cash in equity and bond mutual funds. My next success also involved as much luck as skill. During 2007, in anticipation of retiring in 2008, I moved from 80-20 stocks-bonds to 70 percent bonds. That move took us through the financial crisis in great shape. To tell you the truth, I doubt I would have made that move if retirement hadn't been on the immediate horizon. Fortuitous timing.
I know I'm just an average investor, so individual stocks are now limited to 10 percent of our investment portfolio. The remainder of our investment portfolio is in low-cost index and actively managed domestic and international equity and bond funds (and ETFs). We are able to allow our investment portfolio to grow unencumbered by withdrawals, normally reinvesting all dividends and cap gains with occasional exceptions.