iShares Russell 2000 Index (IWM)

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  • commenter
    Geoff
    Considine
    May 26 04:32 PM
    My Website
    Choosing Your Portfolio Risk Tolerance [view article]
    To rajtrades:

    QPP does use historical prices as inputs but generates forward-looking statistical parameters from these that are often very different than trailing history.     Reply
  • commenter
    Geoff
    Considine
    May 26 04:30 PM
    My Website
    Choosing Your Portfolio Risk Tolerance [view article]
    To Acercher:

    The question that you ask is a good one. First, QPP easily captures asset classes with low Beta but high volatility / high risk. Gold is a great example. Even with very low Beta, a super volatile asset can only be added in moderation because of its high volatility.

    Now, with something like stamps you have the additional problem of liquidity risk which is another thing entirely. i.e. there is no reason to believe that you can unload your stamps easily and at anywhere near fair value. This was one of the classic problems for LTCM: they invested in assets for which there was a very thinly traded assets. As the values declined, there were even fewer buyers...

    Geoff     Reply
  • commenter
    Geoff
    Considine
    May 26 04:24 PM
    My Website
    Choosing Your Portfolio Risk Tolerance [view article]
    To Tom Jacobs:

    Annuities are an interesting topic. When I look at them, I find their fees to be hard to estimate all-in, their costs high, and I worry about the default risk of the firm selling the annuity. I know some smart people who believe in them as a portfolio component, though.     Reply
  • commenter
    TAS
    May 26 12:07 AM
    My Website
    Complex Simplicity: A Better Portfolio of ETFs [view article]
    Good job, Roger. Information an investor can use! Reply
  • commenter
    David Fry
    May 25 10:17 AM
    Friday Outlook: Resumed Stability? [view article]
    I'll work for food.

    And, who knows when the next uptrend will be? Maybe we'll go south first.     Reply
  • commenter
    Tom Jacobs
    May 25 09:51 AM
    Choosing Your Portfolio Risk Tolerance [view article]
    Geoff,

    Thanks for such a comprehensive and detailed piece. I am rather surprised that no mention in made of annuities as a suitable tool to address both risks. Obviously inflation comes into play over any long horizon but there is so much value in being able to plan on an income over ones life, I do not understand why they are not included in analyses like the ones you described here.     Reply
  • commenter
    Roger
    Nusbaum
    May 25 09:17 AM
    My Website
    Complex Simplicity: A Better Portfolio of ETFs [view article]
    Blair no argument, for you it might be a year, someone else six months--no wrong answer. The context is the attempt to teach how to fish not to hand mackerel out from the back of a truck:-) Reply
  • commenter
    starvin
    sargent
    May 25 07:55 AM
    Friday Outlook: Resumed Stability? [view article]
    David keep up this great service please! I missed the posts last week. Any thoughts on large caps using PWB? Do you see mid caps as a good choice in the next uptrend? I use MVV, UKW and VOT for those. Many thanks Reply
  • commenter
    Blair
    May 25 03:12 AM
    Complex Simplicity: A Better Portfolio of ETFs [view article]
    I think that the performance history of many of the ETFs mentioned is way too short to make any kind of quantitative assessment as to relative performance comparisons.

    My assessment is to wait another year before making any investment decisions as to ETF selections..     Reply
  • commenter
    David
    Jackson
    May 25 02:14 AM
    My Website
    Complex Simplicity: A Better Portfolio of ETFs [view article]
    Roger, I think you're totally right. There are a lot of portfolios out there containing ETFs that aren't the cheapest or best, because they were first to market. Reply
  • commenter
    Acercher
    May 25 01:06 AM
    Choosing Your Portfolio Risk Tolerance [view article]
    Geoff--Excellent article. It stimulated me to read many of your other articles, and I find myself in accord with your investing philosophy.

    I was hoping you might find it worthwhile to comment or write about an issue that I see coming up in various investment commentaries by others: they seem to use the concepts of beta (correlation to an index like the S&P 500) and standard deviation (a measure of volatility) almost interchangeably. I think it's because almost everybody equates a low standard deviation with low beta, and ultimately with low risk.

    But would you agree that certain asset classes or stocks could exhibit very low beta while at the same time having a very high standard deviation? For example, rare stamps might have almost no correlation with the S&P 500, and thus could have a beta of 0. However, I also assume it's possible that a collection of rare stamps might have a high standard deviation in terms of what it could be sold for in any given year.

    If my understanding of these statistical terms is correct (which is by no means a given), wouldn't that have an effect on optimizing a portfolio? Typically, if the standard deviation of a portfolio was too high for comfort, you might choose to add more bonds or utilities which have a low beta and low standard deviation. But could you also reduce the standard deviation of the portfolio by adding one or two new asset classes, eg., commodities and currencies, which themselves have low beta but very high standard deviations, and thereby increase rather than reduce your expected return?

    Perhaps I'll have to buy Quantext to find out, but could you give a little commentary on this issue for those people who prefer words to numbers? I promise to buy Quantext either way.

     Reply
  • commenter
    Roger
    Nusbaum
    May 24 08:09 PM
    My Website
    Complex Simplicity: A Better Portfolio of ETFs [view article]
    David, The point was not pick this fund because it has done better over the last however many months it was more along the lines of better mousetraps exist than the biggest and often first to market in a space. You want REIT exposure--look under the hood at all (or as many as you can) of them and pick the one you think will be the best. Further if something is near and dear (like water as an example) if you have exposure, ok but when something new comes check it out, maybe its better.

    Bigger macro; think about all the choices available b4 you go in.     Reply
  • commenter
    David
    Jackson
    May 24 06:30 PM
    My Website
    Complex Simplicity: A Better Portfolio of ETFs [view article]
    I just added the link to the NY Times article, which we dropped by accident. (Apologies to Roger and readers.)

    Roger -- great article. I love the idea of suggesting alternative ETFs to those most popularly used. But how valid is selection based mainly on recent past performance?     Reply
  • commenter
    Richard
    Schweitzer
    May 24 11:12 AM
    Complex Simplicity: A Better Portfolio of ETFs [view article]
    Compare the terms (limits on getting out and getting back in) of Vanguard's VEIEX and its ETF VWO. Then look at respective results in markets price trends.

    Long: VWO     Reply
  • commenter
    Argent
    May 24 10:40 AM
    Complex Simplicity: A Better Portfolio of ETFs [view article]
    Boubou, above, says it all! Reply

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