From time to time it is useful to step back and take an overall view of what the ITA Wealth Management blog is all about. Readers who have been with me since early 2008 remember that ITA initially emphasized passive portfolio management. That is still the focus with the Schrodinger, Copernicus, and Pasteur portfolios. Over the years ITA has become much more. More attention is now paid to risk management, particularly as the market hit new highs. With encouragement and creative thinking from HedgeHunter, the SHY cutoff idea was introduced though the creation of the Sample Allocation Sheet 7.1.3.* Along with the ITA Risk Reduction (ITARR) model, SHY as a “circuit breaker” is designed to reduce portfolio volatility and keep us out of deep bear markets. While ITA continues to evolve there are basic investing principles that still apply. Here are a few.
- Save and follow The Golden Rule of Investing. If one does not have the discipline and means to save, all the “ITA investing seeds” fall on fallow ground.
- Use index vehicles to build portfolios. We break this rule on occasion, but infrequently.
- Diversify globally and focus on low correlated securities.
- Remember that risk is as important as return.
- Benchmark your portfolio.
- Read a few of the recommended investment books.
Sixteen (16) portfolios are currently tracked on ITA. I follow 14 (see Portfolio Performance data) and HedgeHunter manages and reports on the Rutherford and Hawking. The Hawking portfolio makes use of options and as such is on the opposite end of the investing spectrum from the Schrodinger. This range of management styles provides many choices for readers.
Two important spreadsheets are available to Platinum members.
- TLH Spreadsheet – This is a sophisticated portfolio tracking Excel™ spreadsheet that runs best on the Windows platform. Help sessions (Camtasia’s) are available for investors to learn how to use this program.
- Sample Allocation Sheet 7.1.3 – This is the security ranking software that is very easy to use and understand.
Blogs lack book organization so use the Search and Categories options to find information. When using Categories, the oldest posts show up first, whereas if you use the Search option, the most recent post on the searched word will come up first. Experiment until you know how each works.
Keep in mind that ITA Wealth Management is not an investment service in the sense of telling readers exactly what to do and when. Instead, it is a record of example management styles that can be followed, emulated, modified, or rejected. Questions and comments are encouraged. Use the Forum if you suspect the question will elicit sustained discussion. Ask when something is vague or unclear. There is sure to be an answer somewhere among the readership.
*We really need to come up with a new name for this spreadsheet. At least reduce it to SAS 7.1.3.