Asset Allocation

MAKE SURE YOU ARE INVESTED IN SOME BENEFICIARIES OF AN ACCELERATING ECONOMY Laggards of last decade coming to life Value stocks should outperform growth Small-caps should outpace large companies International stocks, particularly in emerging markets should lead domestic Watch the related WEALTHTRACK episode.

READ AGAINST THE GODS: THE REMARKABLE STORY OF RISK Against the Gods: The Remarkable Story of Risk Watch the related WEALTHTRACK episode.

AVOID MARKET TIMING Historical evidence shows market timing leads to significantly lower returns than buy and hold strategy Market timing also leads to increased volatility “…the volatility of investor returns is higher than the corresponding volatility in nearly all specifications.” “Specifications’’ considered: individual stocks, stock mutual funds and stock indexes in U.S. and major international […]

OWN GOLD AS A LONG-TERM PORTFOLIO DIVERSIFIER STRATEGAS ANALYZED GOLD’S CORRELATION TO SEVEN ASSET CLASSES: LARGE CAP, SMALL CAP, INTERNATIONAL EQUITY, EMERGING EQUITY, AGGREGATE BOND, HIGH YIELD, OIL, U.S. DOLLAR HIGHER POSITIVE CORRELATIONS WITH ALL BUT ONE ASSET CLASS OVER LAST YEAR MUCH LOWER CORRELATIONS WITH ALL ASSET CLASSES OVER PREVIOUS TEN YEARS NEGATIVE CORRELATION […]

CONSIDER SOME “HOMEBODY” INVESTMENTS Rosenberg thesis: Transitioning permanently to more frugal “homebody” economy “HOMEBODY” BENEFICIARIES include: Home OfficeTechnologies (cloud) Telecommunications Utilities Food Suppliers Diversifiers include: – Gold – Treasuries Watch the related WEALTHTRACK episode.

STAY CAUTIOUS No one knows how the global recession will play out Profound changes occurring Time to be prudent and cautious Watch the related WEALTHTRACK episode.