Scott's Investments

The Penny-Pincher's All-ETF Portfolio

Wow, IndexUniverse doesn't let us down again! The only two things they are capable of discussing are expenses (important) and diversification (very important). But those two things combined do not maximize a portfolios risk adjusted returns. Increasing research (and of course the experience of 2008) has shown that we cannot rely on traditional diversification and low expenses, especially when all correlations between asset classes go to one. IndexUniverse seems to have selective amnesia when it comes to 'black swan' years like 2008. I for one think momentum based moving average strategies are a third element critical to reducing risk while not sacrificing nominal returns (for more research on the topic checkout Mebane Faber, Tom Lydon, etc.)