ETFReplay.Com's October Portfolio
Scott's Investments | Oct 01, 2012 10:20AM ET
This month’s ETFReplay.com Relative Strength ETF Portfolio has been updated at Scott’s Investments and includes turnover in three of four positions.
I previously detailed
Minor fluctuations in rankings may not always justify selling positions each month. For example, if one ETF drops from the second highest rated to the third or fourth highest rated, it may not warrant selling the position. An investor could only sell a position when it drops out of the top 4 or 5 at the end of the month. This type of modification could be used when someone is looking to limit turnover; however, I think it is important to have whatever rule you prefer to use in place prior to making the investment decision in order to avoid discretionary or emotional decision making.
Below are the top-six ranked ETFs for this month, using both the 6/3/3 and 3/20/20 strategy:
6mo/3mo/3mo
- PCY PowerShares Emerging Mkts Bond
- LQD iShares iBoxx Invest Grade Bond
- GLD SPDR Gold Shares
- RWX SPDR DJ International Real Estate
- PFF iShares S&P US Preferred Stock Index
- IEF iShares Barclays 7-10 Yr Treasury
- PCY PowerShares Emerging Mkts Bond
- GLD SPDR Gold Shares
- SCZ iShares MSCI EAFE Small Cap Index
- XLE U.S. Energy Sector SPDR
- DBB PowerShares DB Base Metals
- RWX SPDR DJ International Real Estate
Below is a performance graph of the portfolio (green) versus SPY (SPDR S&P 500 ETF) and AOR (S&P Growth Allocation) from the portfolio’s inception until September 28, 2012. Total returns are similar but a significant drawdown was avoided in 2011:
Disclaimer: Stock Loon LLC, Scott's Investments and its author is not a financial adviser. Stock Loon LLC, Scott's Investments and its author does not offer recommendations or personal investment advice to any specific person for any particular purpose. Please consult your own investment adviser and do your own due diligence before making any investment decisions.
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