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Old 06-21-2007, 10:15 PM   #21
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Les,
We care, but the business of timing sector ups and downs is one for smarter people than I. Or luckier people. My own experience is that you can be right for awhile, but being right year in and year out, trade after trade, -- when I add up the wrong moves that will also fall in there, I just concluded it was better to just go with a regular rebalancing and asset allocation method -- the future is really long and there's room for a lot of mistakes in the years ahead.

Then again, a friend showed me Bank Rate Monitor recently -- for 2k a year he swears by the sector allocation predictions.
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Old 06-22-2007, 08:42 AM   #22
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Alec - fascinating...I had never considered a portfolio starting with a core holding in the extended market index and building from there...just adding exmx to increase mid and small cap.

How old is this article...a couple of years or more than that? Curious as to how the numbers settle today vs when the article was written.
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Old 06-22-2007, 09:56 AM   #23
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ESRBob, I'm not really advocating timing and agree that the fewer portfolio moves (other then rebalancing) the better. Currently my portfolio is balanced between growth and value, has a healthy dose of international, and is close to being weighted like the Total Stock Market but somewhat underweight in small cap. Regarding TIPS I'm using a method similiar to that discussed in Swedroe's bond book (Appendix B).

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Old 06-22-2007, 01:20 PM   #24
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Originally Posted by cute fuzzy bunny View Post
How old is this article...a couple of years or more than that? Curious as to how the numbers settle today vs when the article was written.
If I remember correctly that article was around 2000-2001. If want to do something similar, there is a lot of data out there to figure it out.

The real interesting thing to do would be to calculate your portfolio, small and value ratings. to do this it helps if you have access to the morningstar monthly returns data, but you could also use the yahoo data after scrubbing it a bit.

Bill Bernstien has details on how to do your own 3FF nalysis.
Rolling Your Own: Three-Factor Analysis

-h
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Old 06-22-2007, 03:32 PM   #25
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Alec - fascinating...I had never considered a portfolio starting with a core holding in the extended market index and building from there...just adding exmx to increase mid and small cap.
That isn't that unusual as it sounds. It's done fairly frequently in taxable accounts to minimize taxable distributions. Because the small and mid cap stocks are a lot more likely to move between deciles it makes sense to hold them in one fund.
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Old 06-22-2007, 03:40 PM   #26
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So you're saying its common to use an Extended Market fund for a portfolio core holding?

Wow, I need to read more...
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