Asset Allocation
CONSIDER SOME “HOMEBODY” INVESTMENTS
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
STAY CAUTIOUS
STAY CAUTIOUS
- No one knows how the global recession will play out
- Profound changes occurring
- Time to be prudent and cautious
HAVE AT LEAST ONE ASSET THAT IS NOT CORRELATED TO THE STOCK MARKET
HAVE AT LEAST ONE ASSET THAT IS NOT CORRELATED TO THE STOCK MARKET
ADD SOME GOLD TO YOUR PORTFOLIO
-
LARGE AND ESTABLISHED GOLD ETFS:
- SPDR GOLD SHARES ETF (GLD)
- ISHARES GOLD TRUST ETF (IAU)
- 3 MONTH TREASURY BILLS AND OTHER TREASURY SECURITIES
- CAN PURCHASE TREASURY SECURITIES DIRECTLY FROM U.S. TREASURY AT TREASURYDIRECT.GOV
CASH AND CASH EQUIVALENTS
CHECK YOUR ALLOCATION TO STOCKS
CHECK YOUR ALLOCATION TO STOCKS
- A big risk for pre-retirees and retirees is a major decline in retirement funds
- Lack of time to make it up
- More than one- third of baby boomers’ 401(k)s: +70% in stocks
- Almost one-tenth of baby boomers’ 401(k)s:100% in stocks
START PREPARING YOUR PORTFOLIO FOR THE NEXT TEN YEARS
START PREPARING YOUR PORTFOLIO FOR THE NEXT TEN YEARS
Market leaders of one decade are frequently laggards of next and vice versa
2010s MARKET LEADERS
(12/31/2009-12/31/2019)
-
U.S. Stock Market:
- Large (S&P 500) +256.4%
- Mid (S&P 400) +230.6%
- Small (Russell 2000) +205.5%
NETFLIX +4000%
2010s MARKET LAGGARDS
(12/31/2009-12/31/2019)
- Emerging Markets (MSCI Emerging Markets Index) +48.3%
- Brazil (Ibovespa) -26.9% (USD)
- Gold +38.9%
- U.S. Treasury Inflation-Protected Securities (TIPS) + 39.2%
-
Commodities:
- S&P GSCI -16.9%
- West Texas Intermediate (WTI) – 23.1%
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