SD-2020 TRADING WITH THE TIDE

[sd]

1-29-20
Still holding SNAP from $15.11 with a stop @ $18.50, BX- stp 60, ARKW -stp $62 and buying MSFT -limit $170.00 for Thursday.
TSLA is up $80.00 after hours-reporting- Wow!

[sd]

Wow! What a down way to end the week! Dow drops 600 pts! Talk about a tough Friday for all of the indexes-
For better or worse, the day job kept me focused on more pressing matters- And computer issues - and VZ issues both took out my cell phone today and internet access for 2 days-
Did a reset on the computer- and other than having to see if -or where- a couple of limit orders that hadn't filled previously may have been executed- I expect my few remaining stops all have been taken out- and I already had stopped out earlier on over 90% this week on the initial sell-off- Primarily put me over 90% in cash at approx a -3% decline- So, if that estimate is accurate, I think I'm sitting out today's larger sell-off- and my remaining active positions that I had open had stops that should have sold off early today- as they were tightened- Just have to see about 1 or 2 pesky limit orders - that were never filled and may have remained oped as GTC- MSFT was one-
Computer reset overnight to clear up the access issues has me starting off restoring past accounts, passwords that I don't remember etc. All this tech stuff we rely on is amazing until it doesn't work and we find we are vulnerable- BIM modeling totally renovates the construction process and it's such an amazing transformation to witness.
Ira had contemplated shorting the market- and my advice was this will likely be short lived- Yesterday that certainly was true as the World Health Organization calmed the market and it rallied- wtf is today all about? Just a reason to take profits across the board and to have a valuation reset to a lower PE?
Speculation has been long in the tooth about the hgh average market valuations - 24x forward earnings vs the "avg 17-18 and the market has largely seen the large caps drag the indexes higher-But perhaps that driver is not so strong with FB now missing, AAPL beating- but China exposure- TSLA blowing out the shorts. AMZN finally coming out of a lackluster 2019 and now having great results, Jeff Bezos rejoice - NFLX holding it's own in face of strong competition- But It appears that it has been something of a large cap lopsided rally- and perhaps the lowered PMI and quarter Growth rate senses an elevated market without a lot of underlying strength-? I think that is the take-a-way I digest from the Talking Heads on CNBC-
Having a larger % in cash feels good after this week's low close- What will the weekend bring in terms of News- because that is what the market will digest- and then determine if today was a one-off event or the start of something larger - a -10% decline we haven't seen in some time recently- in 2019- and -20% almost in 2018-

Well, I'm not in a rush to be a buyer on this week's decline- Market was considered expensive to begin with- Bond inversion is a concern- Likely we will hear more doomsday proponents than pro market buy people-
I had considered a small SDS position but did not act on it with computer issues- I still think that this likely gets resolved in a few weeks- and the markets use this as a reallocation- reset- I was surprised that my biotech positions were the 1st to be stopped out- along with healthcare-Shows what i DIDN'T ANTICIPATE AS WEAK and Vulnerable in the face of a medical crisis. And will this cause TSLA to fall back? They won't be selling cars in China if this continues there-
China is likely to suffer the brunt of the selling- so perhaps a good opportunity to consider looking for big drops and value opportunities there....
I had just taken positions in KWEB, BIDU, BABA, and then held initially as there was an initial decline- and then stopped out below where I should have- Perhaps I get to make up the difference even lower - in the weeks ahead? But in small positions .
This gives me pause as to how I want to manage tbhis portfolio in the future- Will Tech again lead higher? I would think so- but perhaps biotech will come to the rescue- So dicey gambling on the individual names in the news- best to take the index approach IMo.
Winding down- Glad it's a Friday night!

[ira85]

Following is a follow-up to January 27 posts regarding my investment portfolio and SD's suggestions.

By showing my actual holdings I wanted to show how bad a portfolio can get with sufficient neglect. Why do that? Because I'd bet a lot of people are making some of the same mistakes I've made. If I can go public and show some of my mistakes it may make it easier for someone else to recognize he has the same problem and can start to solve it. How did I end up with a portfolio of odd losers? Some of the stocks on that list were touted in newsletters years ago. There was a positive story about the company's bright future at that time. Everything looked promising. So I bought it and held on. There are several thinking errors at work in my holding on to stinkers and I bet others have done the same. One is continuing to hold as the stock drops, hoping to win back some of the loss when it hopefully recovers. Hoping is a losing strategy. I need to remember that. Another excuse for holding a loser is to put off the day I switch it from a paper loss to a real loss. Like I'm trying to fool myself. And I try to fool myself by thinking that neglecting to take action seems like avoiding action. I'd hate to sell the loser and find out it had a big gain soon after I sold it. By neglecting it and taking no action it seems like I'm avoiding potentially making another mistake. But of course taking no action does mean you are making a decision, the decision to hold. Selling a loser is necessary and I failed to come to grips with that.

To manage a portfolio successfully would require reviewing the holdings periodically and making a decision at to buy more, hold, or sell. Most people shouldn't buy more of a stock due to the fact that buying more increases the single company risk, making your portfolio more concentrated and more volatile.

Instead of selling all or most of my holdings, this might be a good time to work up a performance review process and review each stock as if I was considering buying it today. I should look at the chart and the company's numbers. If it isn't doing well enough to be a candidate for a new buy, then sell it and look to replace it with a better, stronger stock. I should also work on changing my perspective on selling. Until now I've hated to take a loss. The important thing isn't booking a loss, it's the strength of the portfolio. Taking a loss on a losing position gets the toxic little bugger out of my system. Getting rid of it is better for me. It's needed. Get used to it. This is the kind of mantra I may do to improve my ability to do the right thing in cutting my losers and letting my winners run.
As the old trader's saying goes, "I ain't married to none of them."

What other steps might I take to manage my investments better? One possibility is to work with an advisor. I have a second visit scheduled next week with a wealth management advisor who is a local guy. I plan to talk to representatives of Vanguard as SD suggested and TD Ameritrade. I also plan to talk to USAA, a company I've dealt with for many, many years. They are the best auto insurance company in the country. Customer service is their long suit. So I'll check out their financial advisor services. And I'm looking at the literature for a robo-advisor company "Personal Capital."

Interesting observation. Traders often repeat the old saying about cutting losses and letting winners run. One successful trader has a list of does and don'ts, including "Never buy a losing stock." That's like the saying "Don't try to catch a falling knife." But I've found the value of re-balancing a portfolio is often touted by wealth management advisors. How do you re-balance a portfolio? By selling some of your winners and buying more of your losers. For example, if you have had a nice gain on your APPL stock,you have become somewhat over weight in tech. You might have lagged the broad market holding XOM, so you are underweight energy. To re-balance you could sell APPL and buy XOM. Rebalancing violates the old wisdom of traders. Is re-balancing a good idea?

My goal is to make some healthy changes and vastly improve the management of my investment portfolio. I'll share some of that here. And SD may see something important that I need to address. I would welcome anyone else to comment. -ira

Very honest and insightful IRA- I would like to comment further later today- if time and the grandkids allow-

[sd]

You brought up a number of things- and I'll try to touch on a few-
When it comes to selecting a portfolio for investment- the vast majority of trained professional money managers fail to outperform the benchmark index.
The underperformance of the professionals only gets worse over consecutive periods- and -after the higher fees are subtracted, the passive indexed approach beats most active money management firms-
The asset allocation & rebalancing assumes that there is indeed a market cycle- where value ultimately rises to the top- So the trimming off of excess gains in one portfolio arena is supposed to be purchasing assets in an undervalued area, that will eventually rise into prominence and the other area will become sold-off and out of favor- But- value has typically underperformed tech for years now-
Another area is that most investors are US focused only- and the US sectors are highly priced- The foreign and emerging markets are priced at lower valuations and have potentially more opportunity for higher growth- but they have also lagged for years-
Trying to pick the very best 5 or 10 stocks to wrap into a portfolio for the long term is quite difficult to succeed compared vs holding a core index portfolio- with only a few stocks at the perimeter for interest and possible outperformance... And- if one applies the focus on the momentum sector or index, one can likely achieve a higher performance by overweighting the sector with the better performances. For example- Tech sector is clearly a multi-year outperformer- although more volatile - with greater ups and greater declines.

The individual stock portfolio does not necessarily provide one with greater safety- or greater reward- unless pruned and adjusted to find the cream of the outperfoming market segments.
A typical indexed focused portfolio does not try to capture the individual performance- but the combined outperformance of momentum across a wider group of stocks-
Compare the underperformance of the energy sector- the lowest sector performance of the sectors that comprise the S&P500- but the overall outperformance of the s&P itself was a 28% return- despite holding energy sector losers in it's make-up- offset by the large outperformance of the Tech segment.
If the professional managers have troubles beating the S&P500 index- with a 28% return- compare that to the portfolio that didn't just focus on the S&P but perhaps weighted the tech index as well- with a 38% return...

As to your example of rebalancing- AAPL gains into purchasing XOM- I do not think that would be a good strategy- perhaps rebalancing some AAPL gains into buying into a broad market index- but not into a losing sector giant- like XOM- Or perhaps instead- of XOM- purchase some of the ETFs that replicate the dividend aristocrats- but not necessarily into any individual position-

Consider the Momentum approach- As we are seeing now is the reaction to an event not anticipated weeks earlier- Very little warning- but this Corona virus scare is a good example of what can derail one's portfolio- No matter how well positioned - the ability to shift towards a higher % in cash, and to perhaps shift partial assets into more defensive sectors- TLT- GLD,Utilities etc- and be comfortable holding a larger % in a "safe" money market fund until the smoke clears- Often these events are minor- pullbacks in the larger scheme of the years long uptrend- but it seems that this could be more substantial due to the inability to clearly define the potential threat of this disease- The market will react to the unknown threat - smart money will protect itself- and it will eventually be referred to as a pullback that offered a buying opportunity - Or the pullback that started the long overdue recession-
My crystal Ball won't give me any insight- but the momentum approach I've tried to follow has me largely in cash at present- and so I'll sleep soundly while this thing unwinds-

I do encourage you to consider the wisdom that is designed to keep you invested though- That is what a financial adviser may offer- but not have you buying AAPL or XOM as individual positions- You will neither capture the big winner, nor the loser, but will stay the course over the long term- and that automatically will make you a winner-
Please let us know what you learn on this journey!
SD

[sd]

I had to step back in partial positions today as the markets rallied higher- Also bought some TLT, ARKK, VGT,VOOG, added to ARKQ-and just for the funside- a couple of TSLA- Guess I won't go to Atlantic City this year-

[ira85]

Back story. I have a portfolio of abandoned stocks bought long ago sitting in 2 brokerage accounts I seldom look at. They are mostly chronic losers that should have been sold years ago. Maybe someone else has neglected holdings sitting in an account somewhere. I know it's a bad idea. I should do better.

One bit of advice I got was to work with a financial advisor to rehab my portfolio management lack of skills. Seems like a good idea. I plan to talk to a few personal financial advisors, or wealth advisors as some of them prefer.

Today I have info on financial advisor Personal Capital.

Personal Capital offers you free access to use their proprietary financial tools. They suggest you

1. enter information about all your financial accounts IRAs, 401ks, mortgages, loans, credit cards, checking, and savings to get a comprehensive view of your money. Link your accounts so all of your financial information is right there when you want/need it.
2. Talk to an advisor to clarify your needs and goals.
3. Make a plan. They will help.
4. Start investing per your new plan.

That all sounds nice. Nice and boring. I probably would find a way to stay too busy to actually do what needs to be done. Let's see if it gets better.

You can use the free financial tools to calculate your net worth. You can make a budget to track how you're doing monthly. Use their Retirement Planner to monitor your progress toward your measurable goals. Use the fee analyzer to search for hidden fees. See what impact they have and what your options are to avoid them. Check your portfolio to see how closely it matches the recommended target allocation. I'm getting drowsy.

Personal Capital has “Intelligent Rebalancing” a system of ongoing rebalancing, “that occurs when the market presents opportunities.” They say this rebalancing system can help avoid costly emotional mistakes and helps you buy low, sell high, and remain well-diversified. Their research reportedly shows that regular rebalancing can significantly enhance portfolio value over time. I hope this isn't the rebalancing stuff that puts me to sleep. We'll see soon.

They also have a tax optimization tool to try to put different assets in the types of accounts that will minimize taxes, such as high yield securities in tax sheltered accounts. You can generate specific plans for tax-loss harvesting, i.e. to offset realized capital gains and be written off against losses.

These financial tools can be used for free. You may also sign up for personal wealth management consultation at varying costs.

More on the Smart Weighting tool. This seems to be pretty central to their system of selecting securities to invest in. Personal Capital takes a very detailed approach to formulating a re-balancing plan. The Smart Weighting tool seeks to limit exposure to any one sector, size or style in favor of greater diversification and balance. You are better protected against downside risk when a particular market or segment declines. The Personal Capital web site has a summary of their investment methodology with lots of graphs and references to research. This looks credible.

This summary of their investment methodology is pretty good stuff. The kind of thing I find interesting. Usually I find descriptions of re-balancing and tax loss harvesting a powerful sleep aid. But this is keeping me interested at 1:16 am. Check it out. www.personalcapital.com/assets/whitepapers/Personal_Capital_Investment_Strategy_v2.pdf

It looks like you have to open an account to get started with this company. It would be potentially interesting and helpful if one could open a play money account and test these tools at home before making a commitment to fund the account with real money. I'll try to reach a human during business hours and ask. -ira

[sd]

Hi Ira,
I have read through the link you provided, and I think the Smart portfolio approach w/rebalancing looks to be a very viable portfolio investment approach- It is interesting in that it intentionally includes exposure to all of the major sectors-- It also can provide a lower Risk volatility and does not chase momentum- And rebalancing will eventually see the net gain over a period of years- It appears to be a diversified long term approach that can withstand the market cycles with reduced volatility and capturing a decent amount of return in the good years-
It is Not intended to be a short-term investment vehicle- but should be viewed as a core long term portfolio management tool that will underperform the leading sectors in any single year, but will- eventually- bring good overall averaged returns with a good deal of reduced volatility- Allowing the investor with limited decades ahead to perhaps rest easy and sleep at night-
I did not see the fees mentioned or the minimum investment amounts- and that will likely be disclosed directly only after you make a personal contact- Many wealth managers have minimum investment thresholds to ac cept an account , and their fees are adjusted based on the amount of the assets placed under their investment authority- I see they can also use a mix of individual stocks and ETFs- and they are also focused on tax efficiency - So , I would ask what the actual investments expense ratio fees are, as well as the total management fees-
Consider that if they use ETF's - most have very low Expense ratios to own. But, if they have "alternative " investments, as an ETF category, those expense ratios can rise quite high-
One can choose to invest a % of one's assets with such a manager- and automatically you just reduced your personal Risk- because you just got widely diversified- Just don't expect to achieve market beating results - in the 1st years- Part of being diversified with lower volatility, and rebalancing- is that the portfolio momentum is intentionally not designed to be the big winner year after- year- but is designed to protect form the larger losses the market will see- eventually, and really gets traction over a 5-10 year holding period-and when Asset preservation may be more important than asset gains in a period of large declines- Does anyone remember market declines?
As we get older , we have less time to recover from a substantial market decline. Persons that have spent decades trying to accumulate some IRA or retirement assets would do well to protect those assets from decline should outweigh those assets from taking Riskier positions to try to grow those assets.
Having a small portion of one's account to engage in the market is stimulating- Having a majority of one's account invested with a lower /Risk approach is prudent for capitol preservation.

My friend Swift does not recommend XOM btw-

[ira85]

TSLA update.

SD is long TSLA. He's probably out having a celebratory night on the town. TSLA closed Monday afternoon at 780 and today closed at 887.06. In after hours trading it's now going for 904.50! I think that's about a 16% one day gain. Elon Musk's holdings have risen by $16 billion since January 1. I've been a skeptic about Musk and his ability to deliver the great electric vehicle that will revolutionize transportation worldwide. Today I'm officially wrong about Musk and SD is on the right side of this one. Congrats SD!

[ira85]

Re: Smart portfolio re-balancing though Personal Capital.

SD's comments above are very much like my reaction to the Personal Capital program. It's a conservative plan with a very well designed to reduce risks. Reduced volatility and reducing risk are likely to improved gains. It seems this system is highly likely to produce slightly higher gains along with reduced volatility. I'm an old guy. I understand reducing volatility is important for old guys. So is capital preservation, i.e. avoiding big corrections and crashes. Many current investors had some dealings with the 2008-09 bear. To refresh memory: from the peak in October 2007 to the closing low in March 2009, the DJ IA, Nasdaq Composite and S&P 500 all suffered declines over 50%. Yes it will happen again. The question is not if, but when. How would this system do in a 50% loss situation? We don't really know, but it seems to me this program will produce incremental improvement in results. So if, hypothetically, the S&P 500 goes down 50% this program's smart portfolios are likely to be down some what less, maybe 40%. That's a hypothetical. I don't think it's likely to be able to side-step the crash and come out completely unscathed. Completely avoiding a crash would seem to require the ability to go to cash or go short. Both of those strategies have the risk of timing mistakes. If you go to cash too early you have the risk of leaving a chunk of the bull market gains on the table, hurting your full cycle performance. If you go to cash too late you get hurt. If you stay in cash too long after the end of the crash, you get hurt. And if you switch to cash too often you get whipsawed. It seems that trying to escape the crash by switching to cash is fraught with risks inherent with timing strategies.

But might it be possible that you don't have to be perfect in your timing to still realize significant benefits from side-stepping some of the crash losses? Might it be possible to use a trend following strategy to stay invested in the best performing sectors when the market is trending higher. And when your metrics show the trend has turned down you switch to cash, but you don't have to be perfect. You don't have to be able to spot the turns immediately to still get most of the upside and miss most of the downside.

Where is this going? It seems like the possibility of using a trend following trading strategy could be added to this program from Personal Capital. You don't have to chose one or the other, unless the management imposes limits on how often you trade. Would adding a switch to cash capability help reduce the risk of major losses in a crash? Or would the risks inherent trading strategies introduce enough risks to offset any benefits? If so, the smart portfolio system may be the way to go. Lastly, in a crash scenario is it enough to reliably escape a small percent of the loss? Would you be okay with accepting a 40% loss and take comfort that it could have been worse? Or would you kick yourself for not trying to do more to preserve capital and reduce the risks of a deep bear market?

I'm planning to look at several more wealth management plans. I'll post when I have something. How about your thoughts? Is there anybody out there? -ira

[sd]

If you review the Hypothetical asset allocation strategies- the Balanced port lost -16.5% in 2008, with a typ annual return of 7.6%- Moderate --23.8- inflation plus -5.9;
but the Aggressive-only lost -35.3- Spy -35% - that year.
These portfolios are designed to not be traded-or go out of the market- but to be adjusted in weightings - and rebalanced as the defensive mechanisms-
One could elect to not give All to any one manager following one approach- but could select 2 different managers- or elect to manage a portion by themselves-
You could also talk to Vanguard- Wealth managers- Low .30 fee --
This article compares several robo firms to the human assisted Vanguard-
investorjunkie.com/reviews/vanguard-personal-advisor-services/

If one felt compelled to trade/invest on their own, they could take a small sum and try to increase it dramatically through trading on their own, knowing the "nest egg" was secure-and would not give them exposure to high flying individual stocks-

TSLA position sold--just a couple of TSLA shares- each-which stopped out on this am pullback- Wife elected to set a tight stop- which will have executed at the open for her shares- about 823- while I thought I would give Tsla some wiggle room- and still got stopped out @ $780. - made a total of $40- Booyah! But it was fun to speculate- Shorts are likely all running for the hills now!

[sd]

TSLA $7,000.00 IN 5 YEARS!
nICE HEADLINE- Catherine Woods of ARKK funds has projections of the value of TSLA 5 years out at a minimum of $1,500 up to a high of $15,000.00 with a mid range value of $7,000.00 She cites TSLA leads in 3 converging technologies- - Battery, AI, and Elec Auto-She was on CNBC tonight and presented an enthusiastic view of TSLA as a tech leader on several fronts-
ARKK fund focuses on innovative technologies that may be disruptive- and so can be part of a speculative portion of one's portfolio- I have periodically owned ARKK and other ARK sponsored funds-but essentially have traded them as momentum moves-

[sd]

2-6-20 note-
Saw Cramer interview TDOC exec-this week, and this company's chart- and business model look right at this time- Video conferencing with a doctor- that can prescribe medications-
Chart looks to be trending well, worth a small spec position with a Limit buy @ $110 and a stop-loss @ 100.00.
Waiting to see where TSLA ends up after retracing the parabolic move- and short covering- Stops were indeed prudent chasing that momentum!
The TLT position has lost ground as the market rallied- VPU has outperformed SPY in the past weeks- and I don't know if I trust this market rallying as much as it has done-
The IBB re-entry has seen a nice gain and is again near a 2020 high -

Presently, I have retained a larger % in cash, and essentially have missed most of this snap-back rally- I feel like I'm the typical market timer that will end up chasing those that simply took a Buy and Hold approach and ignore these minor declines- Several reasons for me to pause in going back-all-in-

There will be an economic impact with China's shutdown of major cities- Should this virus not be brought under control, the initial fear response that was seen in Week 1 will be magnified many times. Perhaps this was the quintessential buying opportunity -minor pullback- now passed...
However, you have to trust what the charts are showing you-

[sd]

ESG- read an interesting article yesterday on the focus of many companies to become environmentally and socially responsible- and it's a big deal to be aware of from investment ceos-like Blackrock's-Fink- and some of the big winners this year were ESG styled funds-
Article on ESG funds that outperformed the "market" in 2019- markets.businessinsider.com/news/stocks/20-esg-exchange-traded-funds-beat-stock-market-past-year-2020-1-1028802890#18-ishares-msci-kld-400-social-etf3 some significant outperformers in 2019- can they continue to do so in 2020? Or is this just a fad? Should the ESG momentum continue, some of these funds will likely continue to lead the markets- With environmental concerns as a global focus, holding a fund that also has a global ESG footprint- may make for a good portfolio addition. I may elect to add one or two of these top performing funds as part of a larger portfolio.

While I have limited knowledge of what is available out there in the world of ETFs and select focused funds, I have liked the disruptive innovation message that comes with the Family of Ark funds-
Ark funds holds quarterly webinars touching on their various funds- Many of the ARK funds also outperformed the "market" despite holding a lower % position exposure to the large FANG names- ark-funds.com/quarterly-webinar/ark-innovation-etfs-q4-2019 Note that the parent fund -ARKK holds a wider mix- selections from it's more focused funds- Including a large exposure to TSLA- Catherine Wood's CNBC interview cited an eventual median value for TSLA (over 5 years) @ $7,000.00 - momentum excess high of $15,000- and With a low value of $1,500 but also mentioned a consideration of bankruptcy in those calculations- Owning TSLA as an individual position for the long term is an act of faith on it's popularity and momentum- Holding ARKK or one of it's focused funds that (ARKW, ARKQ, ARKF, ARKG) reduces the single company Risk and volatility-and also provides exposure to a larger number of companies that may be the next hot investment.

The Corona virus has now claimed more fatalities than the Sars virus- and it seems that it is not yet declining-Although our markets quickly shook it off most of last week- what was the Friday pullback based on? More Corona virus fears with a larger global impact and economic impact- particularly for China- and companies associated with mfg there- or sales-
Considering that entire large cities have been shutdown- no one working- sheltering in place- Big impact on the individuals and their families- and what about not earning a paycheck for several weeks -or longer? And, it seems that there is a big issue with disease in their food chain- with swine disease rampant- across the country- In the Western world, measures are taken early to identify and contain outbreaks-of diseases that can affect our food chain- Beef, Swine etc. but that are not in place in Emerging countries- or China. And the lack of transparency coming out of those countries is also a concern- The doctor in China 1st cited by the police as causing a possible panic when he gave an alarm out - has died from the disease-
And it points out the flawed PR policies of their Government to keep the people calm and in check- And now with dozens of people infected on different cruise ships-

and - there's always Politics on the US front- With the President having been acquitted, Now the political landscape with the Democratic primaries is all in the news-
Should the markets anticipate a democratic win- either in the number of seats in the Senate- or the Presidency- stocks would likely have a significant decline-
Stocks are generally considered to be on the higher side of their historical valuations- and so it seems reasonable to expect that a market pullback is well within reason- and so I've hesitated- to committing a larger % back into the market here- Of course, this is why most of us retail market timers end up under performing over the long run-
The desire to seek safety when a few rain clouds appear to be more menacing than they turn out to be- and then waiting to get back in until the coast is clear- is a sure-fire way to feel safe and yet underperform.

Holding a few stocks-accidentally sold MSFT Friday afternoon as I was distracted when adjusting a higher stop-loss and inadvertently set it as a limit order-
Took a 10% position in TLT-last week, which promptly declined as the markets rallied earlier this week- TlT if things turn south, that's a defensive position- along with VPU-
Spec stock trades- Sold SNAP- held for weeks- from $15.11- Sold on a tighter stop $18.50 before it disappointed on earnings.
Took a small position in WORK Been in a decline, double bottom- Not my typical preferred type of entry-Impulsive entry on a positive comment made on CNBC- These type of oversold decliners can potentially have an oversold rally- but many are in declines for good reason-

Also in DOCU- held up well Friday, and in TDOC- Both of these are preferred trades as they are already positively trending higher-

[ira85]

This us a follow-up on my confession about neglecting my invested assets and pledging to learn how to construct and manage an investment portfolio. The last entry was February 5.

One factor that's particularly important in my case is age. I'm old. If a market crash resulted in 50% losses, it might take many years to get back to even. I won't have many years left for starting over. So I'm looking at possible ways to survive a crash with minimal financial damage. Some advisors explicitly state that goal is impossible and they don't accept it as a reasonable goal. But there seem to be some advisors who embrace that goal.

Check this description of one advisor's strategy. His program is designed to potentially perform relatively well in any market or economic environment, including periods of expansion, contraction, inflation, deflation, etc. The broad stock market indexes passively track the general market, even when stock prices are in protracted downtrends. By contrast this manager's strategy attempts to obtain consistent quarterly returns that exceed those of the equity market and to protect capital against significant risks. Sounds like this advisor thinks he's on the trail of the Holy Grail. I won't put his name in this entry. As I learn more about his program I'll write more.

Another interesting finding this week was a new perspective on fees. A Seeking Alpha article titled "I cannot afford to invest in ETF's" illustrated the high cost over time of seemingly low annual fees. Once a fee is deducted from your account it's gone. It can't help you reach you goals ever again. It's that cumulative effect that really adds up. Even annual fees in the 0.30% territory that are widely considered to be low, add up to huge sums over time. What's his advice? Invest in individual stocks rather than ETF's and mutual funds. Buy them without commission and manage your portfolio yourself. Bing, very low costs. I'm not advising anyone to take this path. I've already demonstrated I botched portfolio management for my own investments.

I'm going to keep looking at advisors. Hopefully I'll find the advisor who prospers in all market environments. The one who gets on the right side of almost every trend, profiting in good times and bad. I'm looking at the marketing material of an advisor who seems to be saying he can do this. More later. -ira

[sd]

HI IRA!

Good to hear that you are finding some interesting approaches for your consideration!
Check this description of one advisor's strategy. His program is designed to potentially perform relatively well in any market or economic environment, including periods of expansion, contraction, inflation, deflation, etc. The broad stock market indexes passively track the general market, even when stock prices are in protracted downtrends. By contrast this manager's strategy attempts to obtain consistent quarterly returns that exceed those of the equity market and to protect capital against significant risks. Sounds like this advisor thinks he's on the trail of the Holy Grail. I won't put his name in this entry. As I learn more about his program I'll write more.

I think I Know of this Advisor-and his virtually guaranteed approach... Or one just like him- His name is Bernie and he lives about 30 miles from me - in Butner's Federal prison. He also assured his clients that his approach would meet or exceed the market average, and also with very minimal downside Risk-
Any advisor that suggests they can "obtain consistent quarterly returns that exceed those of the equity market and to protect capital against significant risks.
is smoking something- and indeed would have the Holy Grail.
I would be very cautious about anyone making such claims- Reminds me of one wealth manager I talked with that was all about promoting an annuity approach with the emphasis on safety - and could not lose the principal investment- and there was even a bonus cash value amount added to the account etc- Annuities can serve a valid basis as part of one's portfolio - because they do bring in returns based on market performance-Benchmarked - (with a cap range) and are guaranteed to not lose the principal- But there are limitations- in all annuities-
How can one achieve market beating results with substantially lower Risk? Inherently, There is no market beating reward without taking on market RISK--
How well did the performance due through each quarter of 2018? While the 1st 2 quarters were good for the markets, Quarters 3 & 4 took a heavy hit. I would be very suspicious when it comes to anyone making such claims.
I would take my time and compare apples to apples- and meet with several different advisors- Fee based and "Fiduciary" qualified. I would share with each of them that I was considering other advisers approaches and have each one advise why their firm's approach was "better". An age appropriate strategy would include some lower performing bonds and other assets besides stocks- And so "Beating" the market should not necessarily be the goal or incentive- If the present assets are adequate for your needs, you would want to protect those assets , while simultaneously seeking some financial appreciation to stay ahead of inflation, plus some modest/safer growth- There are conservative investment approaches that offer diversification, professional rebalancing, and at a lower cost fee-

You are also correct- US Old Guys cannot afford to sustain losses in a significant market event that sees portfolios lose 20% of one's savings- So, I would recommend that you don't put all of your nest eggs into one advisers hands- I would also suggest contacting Vanguard, and see what their recommendations are for you based on your age and personal needs for income- IF you already have adequate income/pensions/ SS etc - They offer various types of portfolio allocations- even a simple 4 ETF broad portfolio that is indexed to the entire World market of stocks, bonds etc- and can be quite inexpensive to own. Or, you can have them handle an individual low cost portfolio.
Your mention of ETF's expenses - Look at Vanguard ETF's for some of the very lowest Expense ratios- without taking on single stock Risk. Review the costs- and their returns:

investor.vanguard.com/etf/list#/etf/asset-class/month-end-returns

You get the benefits of index or sector diversification- or even the total world markets- at a minimal $.03 - $.15 for the vast majority of their offerings.
You could own VT-for $.09 The TOTAL WORLD STOCK INDEX- That owns over 8,000 stocks but also gives 11% exposure to some big names- Month-end 10 largest holdings
(11.50% of total net assets) as of 12/31/2019 Apple Inc. Microsoft Corp. Alphabet Inc. Amazon.com Inc. Facebook Inc. Berkshire Hathaway Inc JPMorgan Chase & Co.
Johnson & Johnson Alibaba Group Holding Ltd. Visa Inc.- Their active management EXP cost is $.30 should you want to have them "Manage" your portfolio- which includes those important phone calls an investor may want to have received by a human on the other end of the line. For a $50K investment minimum- Cost would be $1,500. If the return averaged 10% (+ 5,000.00 )
investor gains- without having to watch over the account and spend time focused on market gyrations-
While I went with a local advisor for part of my portfolio- they have given a modest net return after several years with a higher actively managed net cost between Exp ratio of the funds and the advisor fees- I will likely elect to use Vanguard for a portion of my present assets, as i still intend to rollover some of my active company IRA this year-
Vanguard personal asset manager: Free to talk with- investor.vanguard.com/financial-advisor/financial-advice

The wide range of ETFs- as well as mutual funds offered by Vanguard - covers individual sectors - VGT - a 42% return- Check out the performance tables-
And in the last year they have added socially compliant funds, some added dividend funds etc-
Not sure where to start on your own? Read David Swenson -Unconventional Success as a good starting point- Buy used- Ivy Portfolio- by Mebane Faber-
Faber now runs Cambria funds-



Thanks for Sharing! SD