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O. Young Kwon
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O. Young Kwon, NYU Ph.D. in Economics had worked in securities industry for ten years as a Registered Investment Adviser. He taught Macroeconomics and Statistics. Prior to his academic career, he was an Economist/Bank Supervisor at the Bank of Korea (the Fed's counterpart). In 2009 he set up the... More
  • Income Portfolio: TANER APP (II) 0 comments
    Feb 21, 2012 5:47 AM

    The TANER daily postings are a summary of all betting in the market (including yours and mine) at any specific day (e.g. 1/3/2011). This information is only ONE "cross-section-data" set, based upon the closing prices. All prices changes in extra hours (4:00 p.m. to 8:00 p.m.) and in extended hours (8:00 a.m. to 9:30 a.m.) are excluded.. A single point datum is weak to predict future. That's why the TANER Momentum Trend (TMT) is introduced.

    Following the TMT daily for a longer period of time, we can adjust (a) our asset allocations between equities and bonds or (b) our income portfolio. Or we can get an idea to determine which securities buy, sell, or hold. (See "How to Use the TMT (TANER Momentum Trend)".)

    Income portfolios recently have become more crucial for most investors to preserve their capital.. The markets have become more volatile and trendless. The huge events have occurred week after week. The yields of traditional income vehicles, such as CDs, Treasuries, Savings, and money market funds are extremely low. There is no good place to park cash now.

    In order to generate a maximum income with a relatively bearable risk, as a long-term conservative investor, I have managed my income portfolio, based primarily upon the TMT

    Total Bond ETF (BND), Treasury Inflation Protection Security ETF (TIP), High Yield Bond ETF (PHB), International Treasury ETF (BWX), Municipal ETF (PZA), and Dividend ETF (PFM) are now our income sources. The following table shows their TMT (daily and weekly) scores.TIP has the highest score (114). PZA (68) and PFM (64) are following. BND (46), BWX (44), and PHB (38) are laggong.. Note that BWX weakens recently.

    Total Bond ETF (BND),

    Income Protfolio (% of Total Capital)

     

     

       

    TMs

       

    WEEK

    BND

    TIP

    PHB

    BWX

    VMBS

    VIG

     

    TOTALBOND

    TIPS

    HIGH YIELD

    iNTL BOND

    MBS

    DIVIDEND

    2/14-2/21

    3

    14

    2

    0

    7

    15

    2/7-2/13

    7

    9

    10

    0

    6

    6

    1*31-2/6

    8

    13

    1

    0

    8

    6

    1/23-1/30

    11

    13

    4

    0

    7

    8

    1/18-1/23

    5

    9

    6

    0

    6

    3

    1/10-1/17

    2

    14

    2

    2

    7

    0

    1/4-1/9

    2

    11

    0

    7

    9

    1

    12/28-1/3/12

    1

    9

    0

    8

    6

    9

    12/20-12/27

    3

    11

    1

    11

    3

    4

    12/13-12/19

    4

    4

    4

    10

    4

    7

    12/6-12/12

    0

    7

    8

    6

    5

    5

    TOTAL

    46

    114

    38

    44

    68

    64

     

    The TANER Momentum Trend (TMT)

     

     

         

    /

     

    INCOME

    TOTALBOND

    TIPS

    HIGH YIELD

    iNTL BOND

    MBS

    DIVIDEND

    YILD %

    3.08%

    4.02%

    5.77%

    3.27%

    2.13

    %

    2.1

    4%

    2/17/2012

    16.3%

    13.4%

    10.9%

    0.0%

    9.3%

    5.2%

    1/3/2012

    20.9%

    3.7%

    10.4%

    0.0%

    10.2%

    10.2%

    12/2/2011

    21.1%

    0.0%

    10.9%

    0.0%

    10.3%

    10.2%

    11/4/2011

    21.1%

    0.0%

    10.9%

    0.0%

    10.3%

    10.2%

    10/7/2011

    17.4%

    0.0%

    10.4%

    0.0%

    10.3%

    9.4%

    9/30/2011

    17.6%

    0.0%

    11.8%

    0.0%

    10.4%

    9.2%

    9/2/2011

    17.1%

    0.0%

    13.3%

    0.0%

    10.1%

    8.6%

    8/3/2011

    2.3%

    0.0%

    16.9%

    0.0%

    9.9%

    7.2%

    6/3/2011

    8.4%

    3.8%

    21.0%

    0.0%

    7.6%

    7.4%

    4/8/2011

    2.9%

    6.6%

    19.0%

    0.0%

    5.1%

    5.3%

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