I track 3 "commission free" ETF portfolios on the right hand side of Scott's Investments. Not all of the ETFs are truly commission free but I did my best to include as many as possible in each portfolio depending on what is available from each broker. The brokers highlighted are TD Ameritrade, Vanguard, and Fidelity.
I do not track hypothetical portfolio returns, but instead track the 10 month simple moving average for each ETF. The objective is to track when each ETF is above or below its 10 month moving average. The signals update daily (as opposed to just at the end of the month). Thus, it is possible to get "whipsaws", where an ETF make cross above and below the moving average on a frequent basis. It is up to each individual on how to use the data, how frequently to check the signals, and which system works best for you.
Sign up here for an $8.95 Trial of MarketClub and see their Trade Triangles in Action
For the full strategy background, click here. Investors can use the monthly moving average to determine when to invest in the index or ETF. When the ETF is above a moving average, invest in the position. When it is below its moving average, sell the position and hold cash. The objective is to participate in the index or ETF when the long-term trend is positive, and avoid the index when the trend is negative. Mebane Faber has shown in his The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets how this strategy has historically done a good job of reducing portfolio drawdown and volatility.
Currently, bond ETFs TIP, BND, and AGG are above their 10 month moving average, which is the same as the end of last month. However, unlike last month, DBC, DJP, and DBA, all commodity ETFs, are now below their 10 month moving average. The full signals are below, as of September 30th. All other ETFs in the portfolios remain below their 10 month SMA.
Please note the data source is Yahoo Finance and I use the dividend adjusted closing price to calculate the moving average. It is possible to get different signals if using unadjusted closing prices to calculate moving averages.
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*commissions may apply
Disclaimer: No current positions in stocks mentioned. Please note that Scott's Investments is not a financial adviser. Please consult your own investment adviser and do your own due diligence before making any investment decisions. Please read the full disclaimer at the bottom of Scott's Investments.
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Sign up here for an $8.95 Trial of MarketClub and see their Trade Triangles in Action
For the full strategy background, click here. Investors can use the monthly moving average to determine when to invest in the index or ETF. When the ETF is above a moving average, invest in the position. When it is below its moving average, sell the position and hold cash. The objective is to participate in the index or ETF when the long-term trend is positive, and avoid the index when the trend is negative. Mebane Faber has shown in his The Ivy Portfolio: How to Invest Like the Top Endowments and Avoid Bear Markets how this strategy has historically done a good job of reducing portfolio drawdown and volatility.
Currently, bond ETFs TIP, BND, and AGG are above their 10 month moving average, which is the same as the end of last month. However, unlike last month, DBC, DJP, and DBA, all commodity ETFs, are now below their 10 month moving average. The full signals are below, as of September 30th. All other ETFs in the portfolios remain below their 10 month SMA.
Please note the data source is Yahoo Finance and I use the dividend adjusted closing price to calculate the moving average. It is possible to get different signals if using unadjusted closing prices to calculate moving averages.
Now you can follow me on Stocktwits and Twitter!
TD AMERITRADE | Symbol | ETF | Position (determined by current 10 month SMA) |
DJP | iPath DJ-UBS Commodity Index TR ETN | Cash | |
DBC | PowerShares DB Commodity Index Tracking | Cash | |
RWX | SPDR DJ International Real Estate ETF | Cash | |
VNQ | Vanguard REIT Index ETF | Cash | |
TIP | iShares Barclays TIPS Bond | Invested | |
BND | Vanguard Total Bond Market ETF | Invested | |
VWO | Vanguard Emerging Markets Stock ETF | Cash | |
VEU | Vanguard FTSE All-World ex-US ETF | Cash | |
VB | Vanguard Small Cap ETF | Cash | |
VTI | Vanguard Total Stock Market ETF | Cash |
VANGUARD | Symbol | ETF | Position (determined by current 10 month SMA) |
DBA* | PowerShares DB Agricultural Commodities | Cash | |
DBC* | PowerShares DB Commodity Index Tracking | Cash | |
VNQI | Global ex-U.S. Real Estate | Cash | |
VNQ | Vanguard REIT Index ETF | Cash | |
TIP* | iShares Barclays TIPS Bond | Invested | |
BND | Vanguard Total Bond Market ETF | Invested | |
VWO | Vanguard Emerging Markets Stock ETF | Cash | |
VEU | Vanguard FTSE All-World ex-US ETF | Cash | |
VB | Vanguard Small Cap ETF | Cash | |
VTI | Vanguard Total Stock Market ETF | Cash |
Fidelity | Symbol | ETF | Position (determined by current 10 month SMA) |
DBA* | PowerShares DB Agricultural Commodities | Cash | |
DBC* | PowerShares DB Commodity Index Tracking | Cash | |
VNQI* | Global ex-U.S. Real Estate | Cash | |
IYR | Dow Jones US Real Estate | Cash | |
TIP | iShares Barclays TIPS Bond | Invested | |
AGG | Barclays Aggregate Bond | Invested | |
EEM | MSCI Emerging Markets | Cash | |
EFA | MSCI EAFE | Cash | |
IWM | Russell 2000 | Cash | |
IWB | Russell 1000 | Cash |
*commissions may apply
Disclaimer: No current positions in stocks mentioned. Please note that Scott's Investments is not a financial adviser. Please consult your own investment adviser and do your own due diligence before making any investment decisions. Please read the full disclaimer at the bottom of Scott's Investments.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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