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Learn From The Master: The Goldman Sachs 401K Plan Provides Stellar Investment Choices http://stks.co/3LLJ $GS $SPY $AGG $DBC Apr 13, 2012
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barrons 10/13: PIMCO Taborsky: traditional asset allocation misguided. Should allocate based on risk factors. http://bit.ly/9lEKS. Oct 4, 2009
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Buffett's metric: fairvalued, Shiller's: overvalued: http://bit.ly/2TLVH2. Another correction for sure. Sep 24, 2009
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10 Low Volatility Stocks for the Volatile Markets
The MSCI USA Minimum Volatility Index aims to refl ect the performance characteristics of a minimum variance strategy for the US large and mid cap equity universe. The index is calculated by optimizing the MSCI USA Index, its parent index, for the lowest absolute risk (within a certain set of limits) using an estimated security co-variance matrix. Historically, the index has shown lower beta and volatility characteristics and a bias towards smaller cap stocks and lower idiosyncratic risk relative to the MSCI USA Index.
The index historical performance
Furthermore, the index offers higher yield (2.97% vs. 2.35%). In the current extremely low interest environment, this ETF can be a good candidate for US stock exposure in an asset allocation portfolio.
Furthermore, the top 10 holdings (as of 10/31/2011) can be good starting points for a risk averse stock investor to form a relatively low risk portfolio:
From the holdings, one can see most of them are blue chip companies with stable cash flow.
Disclaimer: MyPlanIQ does not have any business relationship with the company or companies mentioned in this article. It does not set up their retirement plans. The performance data of portfolios mentioned above are obtained through historical simulation and are hypothetical.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
5 Stocks The Motley Fool Owns
Stock pundits are quick to dish out stock recommendations -- but when it comes down to it, most don't even own the stocks they recommend. The Motley Fool recently published a list of 5 stocks that they recommend and own.
Smartphones are everywhere, and there will undoubtedly be many long-term winners in the field. Qualcomm [Nasdaq: QCOM] is ideally positioned to be a leader in this market.
Ultra Petroleum [NYSE: UPL], a natural gas-focused exploration and production company that makes its living drilling in Wyoming's Green River Basin and Pennsylvania's Marcellus Shale
Fiserv [Nasdaq: FISV] performs account and check processing, credit and debit card services, electronic transfers and bill payment, and more.
Annaly Capital [NYSE: NLY] uses short-term financing to buy longer-term mortgage-backed securities and other debt, largely issued by Fannie Mae and Freddie Mac.
Altria [NYSE: MO] is the company behind Marlboro cigarettes, Copenhagen and Skoal smokeless tobacco, and quarter-owner of the beer behemoth SAB Miller.
This is a diversified selection of stocks and it will be interesting to compare this with our ETF benchmark of a balanced portfolio of Dividend producing ETFs.
However, the stock selections appear on paper, their performance has not been that attractive. Having good dividends is going to keep you afloat but both the dividend ETF portfolio and some blue chip stocks will likely serve you better than this.
The more detailed analysis and graphs give you a visual view of the volatility.
This selection of equities had a very strong spike around 2008 and perhaps they will spike again. We will track this selection but this isn't something I would want to own.
Disclosure: MyPlanIQ does not have any business relationship with the company or companies mentioned in this article. It does not set up their retirement plans. The performance data of portfolios mentioned above are obtained through historical simulation and are hypothetical.Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
The Dow's 10 Best Dividend Stocks
We are looking at the hit parade of dividend stocks. We have already looked at the bottom 20 and we now look at the top ten stocks and we can compare their performance along with the performance of a dividend ETF portfolio.
Jake Lynchof The Street compared the pessimism of Pimco and Ken Fisher in terms of whether there is a strong future for stocks. He concluded that the case for stocks is compelling, given the low yields offered by bonds and the government's commitment to accelerate economic growth. Among the cheapest stocks in the U.S. market are Dow components, which offer clean balance sheets, powerful brands and emerging-markets exposure.
The top ten equities according to this report are:
We entered these funds into our system and then compared it with a balanced portfolio of Dividend producing ETFs.
Three Month Chart
Five Year Chart
The more detailed analysis and graphs show the volatility of the stock portfolio which has performed well in the short term but not in the longer term.
This is more what we are looking for in a dividend stock portfolio -- consistent returns over a longer period. We note, however, that the Sharpe ratios are lower than the ETF portfolio but this has to be contrasted with the more activity required for the ETF portfolio in terms of monthly tuning.
This is an interesting contrast but not compelling against some of the other returns we have seen -- for example:
Symbols: KO, JPM, CVX, MSFT, UTX, MRK, HPQ, KFT, WMT, IBM
Long and Short Ideas, investing for income, ETFs and portfolio strategy
Disclosure: MyPlanIQ does not have any business relationship with the company or companies mentioned in this article. It does not set up their retirement plans. The performance data of portfolios mentioned above are obtained through historical simulation and are hypothetical.