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ZROZ: How I Think About Treasury Ownership

Summary

  • Too many investors think of asset ownership binarily, as either good or bad based on their price movement convictions. This is a bad approach.
  • I use ZROZ to illustrate how I think of bond funds strategically, and why I am long treasuries when no one else seems to be.
  • I continue to think that a diversified approach that invests in treasuries is most appropriate for this period of high uncertainty.
  • Looking for a helping hand in the market? Members of Storm-Resistant Growth get exclusive ideas and guidance to navigate any climate. Learn More »

American stimulus check

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I have a thesis, based on casual observation of investor behavior: many (too many, to be frank) think of asset ownership binarily, simply as either good or bad. It's good because investors think that the price will likely go up in the

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Data by YCharts

Chart
Data by YCharts

50/50 Stock-and-Bond Portfolio vs. S&P 500

50/50 Stock-and-Bond Portfolio vs. S&P 500 (DM Martins Research, data from NYU Prof. Aswath Damodaran)

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This article was written by

DM Martins Research profile picture
20.57K Followers
Tracking Economic Inflection Points To Guide Your Asset Allocation Strategy

Daniel Martins is a Napa, California-based analyst and founder of independent research firm DM Martins Research. The firm's work is centered around building more efficient, easily replicable portfolios that are properly risk-balanced for growth with less downside risk.

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Daniel is the founder and portfolio manager at DM Martins Capital Management LLC. He is a former equity research professional at FBR Capital Markets and Telsey Advisory in New York City and finance analyst at macro hedge fund Bridgewater Associates, where he developed most of his investment management skills earlier in his career. Daniel is also an equity research instructor for Wall Street Prep.

He holds an MBA in Financial Instruments and Markets from New York University's Stern School of Business.

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On Seeking Alpha, DM Martins Research partners with EPB Macro Research, and has collaborated with Risk Research, Inc.

DM Martins Research also manages a small team of writers and editors who publish content on several TheStreet.com channels, including Apple Maven (thestreet.com/apple) and Wall Street Memes (thestreet.com/memestocks).

Analyst’s Disclosure: I/we have a beneficial long position in the shares of SPY either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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