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9 comments:
Roger, did I hear on CNBC yesterday some guest (it's in the other room so I didn't have a visual, and I probably shouldn't even listen to it during the day) say that Vietnam market was risky and expected it to tumble?
My goodness...this is like a potpurri of naughtiness. Roger, I didn't click on any of these. Why do people do such stupid stuff? I only am fluent in English, but I can translate most of these titles.
It was John Roque from Nataxis Bleischroder
Models this week
Timing Model = 1.0
70% long, 30% cash
Global Allocation of long positions
MSCI EAFE Index 30%
MCCI Emerging Markets Index 30%
Russell 3000 Index - U.S. 40%
Top U.S. sectors
U.S. Consumer Services 5.0
U.S. Telecommunications 5.0
U.S. Pharmaceuticals 4.0
U.S. Financials 4.0
U.S. Real Estate 4.0
U.S. Banks 3.5
U.S. Basic Materials 3.0
U.S. Health Care 3.0
U.S. Biotechnology 3.0
Top Intl. ETFs
MSCI Spain Index Fund 3
MSCI Singapore Index Fund 3
MSCI Sweden Index Fund 3
FTSE/Xinhua China 25 Index Fund 3
MSCI Malaysia Index Fund 3
MSCI Germany Index Fund 3
MSCI Hong Kong Index Fund 3
MSCI Mexico Index Fund 2
S&P Latin America 40 Index Fund 2
MSCI Belgium Index Fund 2
Top asset classes and regions
FTSE/Xinhua China 25 Index Fund 4.0
MSCI Hong Kong Index Fund 4.0
MSCI Pacific ex-Japan Index Fund 3.0
MSCI EMU Index Fund 3.0
S&P Latin America 40 Index Fund 2.0
streetTRACKS DJ Wilshire REIT 2.0
Short Precious Metals 2.0
ishares Silver Trust 2.0
MSCI EAFE Value Index Fund 2.0
My timing model ticked up a half point this week because Jason Goeferts Composite Index climbed back into OB territory. That may sound strange, but if you closely observe sentiment indicators and models you'll notice they can say in OB territory for a long time. The price action of stocks sense last June is a textbook example. It's usually best to sell when an indicator is falling from OB territory.
One other interesting to note. The U.S. is more or less at parity with the EAFE. Check out this chart:
http://www.tiny.cc/yX25A
Although the long term trend between the U.S. and EAFE markets look pretty ugly, the U.S. markets have been gaining in relative strength since last May. My crystal ball is a little cloudy, but could this mean there will be less disparity between U.S. and International stock going forward...for a while at least?
Agreed, relative strength of US markets looks a bit better than international on average so, yes, an index investor should probably not overweight international in the short to intermediate term at least. OTOH, risk just seems to be climbing higher in all markets regardless, FWIW.
It is always good to reinforce the importance of knowing when to sell an investment, as you aptly note.
Most blogs are innudated by technical analysis, clever investment schemes and success stories. When to make the "round trip" is rarely mentioned when giving BUY THIS NOW advice.
Providing timely commentary on the basics is one reason your blog has such a strong foundation and is so well received by a large audience.
RR-
I have two things to share. First I wanted to let you know I love the video posts, it brings another level of interest to the blog, serves as a good platform for the weeks discussions and brings tangibility to RR, keep up the good work.
The second reason for writing is a question for you. There has been a few posts about "alpha" and its separation of indexes, a few more comments regarding indexes beating funds and over time out-pacing even the best, and finally there have been many posts on diversification. My question to you is: What is Roger Nusbaum goal when creating a portfolio. Maybe its one sentence, maybe a paragraph, maybe a word. But from the 10,000 ft view what do you hope your portfolios to accomplish. Its seems you employ many tools from many different tool boxes. You appear to believe in some market timing. I think based on your posts that you also use macroeconomic level forecasting. Finally you seem to be a firm believer in value investing. Of course this is all inferred and I may be way off. Also I know I missed a bunch of other means you use. Can you include these in your 10,000 ft view?
ps. I agree a most interesting set of comments on funds vs stocks and professionals vs everyday people. A big thanks to all of those that made it possible.
ROGER,
WHICH SECTOR DO YOU SEE AS HOTEST OVER THE NEXT 6 MONTHS OR SO? NATURAL RESOUCES, OIL, BANKS? ETC>
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