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  • 2 Aristocrat ETFs [View article]
    Thanks for your excellent article.

    You may be interested to learn that an additional aspect that makes NOBL somewhat more compelling (in some investor's opinions) is the fact that NOBL is an Equal-Weighted ETF (following the equal-weighted S&P 500 Dividend Aristocrats Index). SDY is Dividend-Weighted (following the S&P High Yield Dividend Aristocrats Index).

    When NOBL is rebalanced every quarter, the issues that have under-performed are purchased, whereas the issues that have over-performed are reduced. This strategy (sort of a buy low, sell high approach) has done very well over longer-term time periods. The benefit to Equal-Weighting is that it provides more exposure to medium and smaller-cap stocks, which have historically outperformed large-cap issues.

    A quick check with shows that as of yesterday's close, NOBL has returned 20.82% since it's inception on 10/09/2013. During that same time frame, SDY returned 14.66%, while SPY was up 20.65%.

    While I was a buyer of SDY years ago, I did switch to NOBL when it was introduced, specifically due to the equal-weighting methodology. It certainly doesn't appeal to everyone, but might be worth a second look for you.

    Sep 9, 2015. 10:01 AM | 2 Likes Like |Link to Comment
  • If You're Gonna Spew, Spew Into This! [View article]
    I enjoyed your article, analysis and data presentations very much Adam. And it is not very often that an SA author shares true investment wisdom that 99 percent of their readers would be wise to acknowledge. That advice - "I'm not going to offer any salacious foresight into what's about to happen, because I know that I don't know."
    Aug 23, 2015. 01:06 PM | 3 Likes Like |Link to Comment
  • Frontier Markets Index Issues: How Flawed Index Construction Is Distorting Perceptions Of The Asset Class [View article]
    As a confirmed believer in indexing, and a fan of equal weighting, you've shined a light on problems that many index investors are likely not aware of with market cap weightings. But more importantly, your article may cause some readers to begin looking closer at what is actually in their index fund, and how it evolves over time.
    Aug 21, 2015. 02:54 PM | Likes Like |Link to Comment
  • The Short-Term Outlook For Leveraged Gold Miner Bulls [View article]
    Excellent analysis Nathan, as always. I'm glad you followed your conviction after receiving flak from someone else on SA. Your knowledge, analytical skills and ability to communicate are exceptional. Stay the course.
    Jun 3, 2015. 04:51 PM | 1 Like Like |Link to Comment
  • The Top 5 Problems With Tactical Asset Allocation Portfolios [View article]
    While seeking perfection is admirable, investing is often a very messy process. That is one reason why it is not considered an exact science but rather an art form.
    May 11, 2015. 12:21 PM | Likes Like |Link to Comment
  • Sustainable Momentum Investing: Doing Well By Doing Good [View article]
    Buy and Hold:
    Your last paragraph perfectly sums up all of the analytical studies on the topic that I've read since the late 70s.
    Mar 29, 2015. 11:29 AM | 1 Like Like |Link to Comment
  • Direxion Launches 2 Dividend Focused ETFs [View article]
    You may also want to take a look at NOBL - the Dividend Aristocrats from ProShares, which is an equally weighted ETF.
    Mar 28, 2015. 11:20 AM | Likes Like |Link to Comment
  • The Smart Beta Craze Is Here, And It Shows No Signs Of Stopping [View article]
    Thank you Anonymous Vol trader. You and I caught the same error.
    Mar 17, 2015. 09:16 AM | Likes Like |Link to Comment
  • Is There A Holy Grail To Investment Success? [View article]

    Enjoyed your article. Having been in the business professionally since the late 70s, I will admit I initially looked at your title with a jaundiced eye. However, I was pleasantly surprised that the typical "Buy a 3X Biotech ETF" was not your Holy Grail solution.

    Your explanation for understanding Geometric vs. Arithmetic mean was both clear and concise as well as an important topic seldom discussed in investment writings, yet one of significant importance, especially for non institutional investors and advisors, who are often totally unaware.

    Although Warren Buffett recommends an index fund for most individual investors, he and his sidekick Charlie Munger have focused on building a "concentrated equity portfolio" just as you have pointed out as a way to beat the stock market averages. It seems to have provided them with nice returns over time.

    Last, your advice to buy multiple asset classes is again, spot on. While the raging bull market of the past 6 years has convinced many to invest solely in domestic stocks to the exclusion of all the other asset classes, not only have they assumed a much higher degree of risk, but such extraordinary returns are simply not sustainable over time, increasing the probability that they will experience "big losses which can hurt you more than big gains help you."

    Thanks for sharing your ideas and I hope to read more of your articles in the future.
    Feb 11, 2015. 04:34 PM | 1 Like Like |Link to Comment
  • Dividend Aristocrats + Equal Weighting Has Beat Market For 14 Of 15 Years [View article]
    Excellent article. Your analysis convinced me to move from VIG to SDY a few years ago. When ProShares introduced NOBL in October of 2013, I was all in and have been very happy ever since. I've also used RSP for over 10 years and been very pleased with those results.

    As galicianova mentioned above, I have also started following EQAL. It is not the lower expense ratio (though I won't complain) that interests me, but rather their methodology. And right out of the gate the first month's performance vs. RSP was strong.
    Feb 6, 2015. 06:37 PM | Likes Like |Link to Comment
  • 5 Simple Ways To Beat The Market: Part 5 Of 5 [View article]
    Sorry Ploutos, not sure if you mentioned for those interested in NOBL (S&P Dividend Aristocrats), it is also an Equal-Weighted index.
    Dec 12, 2014. 01:54 PM | 1 Like Like |Link to Comment
  • 5 Simple Ways To Beat The Market: Part 5 Of 5 [View article]
    Great to have you back Ploutos. Enjoyed all five of your articles. Great advice for B&H investors.
    Dec 12, 2014. 01:18 PM | 1 Like Like |Link to Comment
  • The Oil Trade [View article]

    Great to see you back!!! I thought we had lost you to a car accident on a freeway in Chicago, or some other unfortunate life-ending event, as your posts simply....stopped. What a void your absence created on SA. Glad to see you are alive and well (and hopefully healthy) and really looking forward to the return of your wisdom and strategies on the markets. Thanks for an excellent early Christmas present!
    Dec 3, 2014. 08:09 PM | Likes Like |Link to Comment
  • Guggenheim's RSP: Equal Weight Or Dead Weight? [View article]
    Mr. Porter:

    "Author’s reply » I do not mention VO or IWR. They are not, strictly speaking, comparable ETFs. My aim was to compare equal weighting with cap weighting in strictly comparable funds; I discuss VOO, IVV and SPY, all of which have the same holdings as RSP."

    I made my comments concerning IWR (iShares Rusell MidCap ETF) and VO (Vanguard MidCap ETF) after two of your readers left the following comments:


    "russel mid cap (800 stocks!) does pretty much exactly as RSP at half the price


    "The charts of VO (vanguard mid cap) and RSP are very similar at one, five and ten years--with a slight edge for VO at 5 and 10 years"

    After most readers pull up a long-term chart on your comparison of RSP to VOO, IVV, and SPY they recognize that RSP is the clear winner. Next, more astute readers often compare RSP to MidCap indices such as IWR and VO, as the two readers above did, claiming the performance is identical, yet IWR and VO have lower expense ratios. If my memory is correct, a few years ago even Morningstar made a mention that RSP's equal weighting simply made it a MidCap in sheep's clothing.

    "Next, your point about when equal-weighted funds buy and sell is not germane to the issue, and may not even be correct. RSP rebalances quarterly and reconstitutes annually - not when market is up or down. Please cite your sources for your claim so that I may evaluate them."

    Equally weighted portfolios (such as RSP) benefit from two major differences over capitalization weighted portfolios. First, by equally weighting each of the 500 issues in the portfolio, the smallest issues, which historically tend to outperform larger issues, are over-weighted in relation to their capitalization weighted brothers (VOO, IVV, SPY). For example, IVV currently gives Apple (AAPL) at 3.8209% its largest weighting vs. Diamond Offshore Drilling (DO) at 0.0132% its smallest weighting. But RSP currently gives Apple (AAPL) 0.22% weighting and Diamond Offshore (DO) a 0.16% weighting.

    Second, the other edge for equal weighting is that each quarter when RSP rebalances their portfolio, they systematically sell recent gainers and buy recent losers (buying low and selling high) in order to weight their issues equally. Capitalization weighted ETFs simply buy and sell their stocks according to their size, regardless of whether they are over/under valued or recently gained or lost in price.

    And finally -

    "As for RPG and RPV, they are very nice funds, but - again - they are not strictly comparable to RSP in terms of holdings, and do not pertain to the issue I was examining here."

    You are correct that they are not strictly comparable to RSP, although their holdings are also included in RSP. But for those who may sometimes seek to think outside the box, these two ETFs may even be better than RSP.

    I am sorry that you took such umbrage at my original comments and hope that you may find these additional comments/responses more satisfactory. In any event, I wish you a very happy Turkey day.
    Nov 27, 2014. 04:57 AM | Likes Like |Link to Comment
  • Guggenheim's RSP: Equal Weight Or Dead Weight? [View article]
    Interesting that this exact same issue pops up every two years or so on SA, with a different author and different reader comments, exploring the RSP vs. VO/IWR debate. While charts show the performance of RSP, VO and IWR to be almost identical, the underlying stocks in RSP remain LargeCap stocks equally weighted, while the stocks in VO and IWR remain MidCap stocks market-cap weighted. The Equal Weighting methodology (RSP) takes advantage of buying low and selling high when re-balancing, which is not true for market capitalization issues which usually continue to buy stocks even though they may be overvalued at the time of re-balancing.

    I have utilized RSP for many years along with their even stronger siblings - Guggenheim's S&P 500 Pure Growth (RPG) and Guggenheim's S&P 500 Pure Value (RPV). The latter has had exceptional out-performance from the market bottom on March 9, 2009 through November 24, 2014. shows RPV returning approximately 584% vs. approximately 303% for both VO and IWR. Have a look and decide for yourself.
    Nov 26, 2014. 06:11 PM | Likes Like |Link to Comment