Tactical Allocations

Monthly Portfolio Update: There is no change to the tactical allocation for April, it remains:   Large Cap Equity:   100%   Small Cap Equity:     0%   High Yield Debt:        0%    Inv. Grade Debt:        0%   The Equal portfolio:   This account now has $325.80 in cash. There will be no trades in the equal weighted portfolio. The TA portfolio:  This account now has $1013.78 so I will use that to buy as many shares of VONE as I can on April 1, 2018.  The Enhanced portfolio:  There is no change in allocation for this portfolio, however I am going to make a diversifying trade. I will increase exposure to VONE and reduce exposure to DSEUX. I am slowly moving this portfolio into a place where it holds only two months worth of allocations in any one security. I will sell 1/4th of the DSEUX and buy as much VONE as possible with the proceeds and cash in the account on April 1, 2018.  I will post the trade details shortly thereafter. Disclaimer: Past pe

"That which gets measured gets improved" ~ Thomas S Monson Last month I posted on some good calls I had made and I wanted to offset that this month with something I have learned (read between the lines - a poor call) as I have been running this blog. Lesson: Sizing of exposures is critical. When starting the blog, I sought to make it simple and just made two bets in the enhanced portfolio. I replaced small cap equity with emerging market equity and large cap equity with international equity. Normally the portfolio would have a more diverse set of ideas but for simplicities sake I only started with two. As you can see below, the international equity (DSEUX) has not performed well and has been a large drag on this portfolio. I expect this will be reduced over time but it creates a tough start for the "enhanced" portfolio. The way to read this chart is; each color is one of the investment options I have talked about in my blog. The return percentage is listed

MORNINGSTAR PEER RANKS: Often the most difficult test is to look at a fund against its peers. How does performance stack up against the other active managers who are trying to run a similar strategy? I went out to Morningstar and found a Tactical Allocation Peer group ( you can see it here ). These numbers will be more meaningful as my strategy gets a longer history and I can compare 1, 3 and eventually 5 year numbers. As of February 28, 2018: 1 Mo 3 Mo 1 Yr 3 Yrs 5 Yrs Equal   79%   34%   -na-   -na-   -na- TA   35%   90%   -na-   -na-   -na- Enhanced   10%   4%   -na-   -na-   -na- # of Funds    307   307   293    241    182 Max    1.67%   5.94% 25.86%  12.80% 11.93% Min -11.87% -8.20%  -9.17% -12.28%   -8.89% COMMENTARY: The TA fund has had a very good three months. The Equal fund bounced back this month due to its more conservative holdings. The Enhanced fund has struggled a lot over the past three months. The short term metrics can jump around a lot (all t

PERFORMANCE: Cumulative returns of each of the strategies as though you had invested $100,000 in them at the beginning of the blog. In January the  Equal weighted portfolio  was the best performing portfolio and returned -2.5%. This portfolio is my version of a buy and hold portfolio and I use it as my benchmark for the two portfolio's below.  The  TA portfolio  returned -3.7%. This portfolio invests in the same securities as the Equal weighted portfolio but actively allocates by adjusting how much is invested in each asset class. The  Enhanced portfolio  returned -5.1%. This portfolio uses the allocation of the TA portfolio and seeks to enhance those returns by buying funds that access the asset class in a different way. COMMENTARY: Equal Portfolio:   This portfolio is invested about 25% in each of four asset classes ( investment grade debt ,  high yield debt ,  large cap equity  and  small cap equity ). It is the baseline or benchmark ag

TRADES  (performed on March 1st) : Equal Weight Portfolio: Beginning cash $1,068.65 Purchased 5 shares of AGG at 106.45 (I did this trade first because it has the larger price and I wanted to maximize the dollars spent), $7 commission, total cost $539.25 Purchased 14 shares of JNK at 36.02, $7 commission, total cost $511.28 Ending cash $18.12 TA Portfolio: Beginning cash $613.89 No Trades Enhanced TA Portfolio: Beginning cash $80.21 Sold 706.3349 shares of DSEUX at $11.05 per share (I put this order in to sell $7805 which is 1/5th of what I have left), $7 commission, total proceeds $7798.00 Purchased 779.3277 shares of DBCMX at $10.10 per share (I put this order in to buy $7871.21 which is the balance of proceeds and cash, your account will only let you do this if you have the ability to borrow [margin]), $7 commission, total cost $7878.21 No cash left over DISCLAIMER: Past performance is not a guarantee of future performance.  This strategy is presented f