Hi Tom,
The new setup is really enjoyable to look at!
A few thoughts:
- (Current makeup - 36.9% Growth/Value Funds, 5.4% Precious Metals Fund, 13.0% Money Market Funds, 44.7% Income Funds). This view on the portfolio is PP-esque. The precious metals definitely made your portfolio more 'chaotic'. DEM also behaved nicely, while PYH lagged a bit, both compared to the Vanguard set.
- In general, it would appear that a dynamically managed version (AIMed version) of UBaHS will still do better than UBaHS all by itself.. I think that is to be expected. The figure they always show to prove the advantages of combining asset classes( 2 upwards sloping sinuses) in portfolio design, also shows that use of AIM on the seperate classes should help. I like the AIM model over rebalancing because of its rich functionality. Also I did a test a long time ago of AIM versus 'Graham style' rebalancing and I am happier with AIM.
- my 11th position, Cash. This is another nice AIM attribute: A dynamic counter-cyclic cash or ST bond position.
- not "steady state". This is good, because insights evolve, so the portfolio structure is a changing one. At this moment i have decided to not restructure or rotate my portfolio anymore, only rotate when AIM says Sell or Buy. I have the feeling that AIM signals are better and when i decide to rotate something feels wrong. I saw your return to ACG, i dont know if you did this because of the monthly dividends, and your move from NRO to VNQ. I considered to combine a few CEFs and ETFs, which i got during the last shopping spree, into ACG, because to handle one fund is nice and easy, but found out that the mix had a higher return than ACG so i left it there. I also got some NRO, but they are freeshares, which i will sell on an AIM sell signal. I also have IUSP, the ishares US reit fund. I used buy signals from this fund to buy into VNQ, now both IUSP and VNQ are selling(this morning i saw I had a VNQ sell yesterday!)
- DLS. I like the dividend capture of the Wisdomtree funds. When looking inside DLS I am not sure because of the concentration in a few countries. I have to buy more small cap blend and small cap value and still considering which vehicles to use.
- UBaHS is basically similar to William Bernstein's Four pillars of investing, I wonder what the source of these ideas is, could it be some economic research!?
Concluding: I also use as a first pillar the UBaHS or Bernstein framework. I use AIM buy and sell signals to gradually move into that direction, trying to exploit future ideas. As a second pillar I use a set of stocks selected using cash flow considerations, this set is AImed. As a third pillar i use inside the Bond component of the UBaHS, 2 PP's, I am looking at AIMing the US PP vs the EU PP. Still considering how to setup the mechanics(classic PP vs AIM PP, it looks as if AIM PP is better managable).
Kind Regards, K
