2011Dec15 Stocks or Not?

 

Many investors equate investing to buying stocks.  However, over the last ten years the access to other asset classes traditionally available only to large institutional investors has become available to a much wider segment of the population. By broadening the places for investment from just US stocks to other asset classes like international stocks, commodities, currencies, fixed income and even cash alternatives; you have greater flexibility for your investments when US Equities are out of favor. 

Asset classes tend to rotate in and out of season just like the produce in the supermarket does.  Over the last ten years, no single asset class has been a top performance in each and every year.  Sometimes US equities were at the top. Sometimes they were at the bottom.  Sometimes Commodities found their way to the top in performance; in other years it was Fixed Income or a Cash Alternative.  Just as a chef will seasonally adjust his menu offerings based upon the freshest produce available, investors should be willing to shift their portfolio focus based upon what asset class is in season.

Traditionally, your advisor has used a general guide for your portfolio such as 60%/40% as stocks/bonds or bonds/stocks. That is arbitrary and relies on repeating history’s returns for your future success.

Why would you still do that when the process has been so discredited?

Adapt your portfolio to the changing economic environment. For instance, our current evaluation reveals a need to change your asset allocation significantly.

As of December 15, our rankings are:

 

If you still own international equity holdings, you should have reduced or eliminated them to minimize risk within a deteriorating asset class at the end of September. Did you? Your advisor didn’t call?

Isn’t it time to get another opinion?

Our asset allocation process can be viewed from here.
Our current asset allocation model can be viewed from here.
 

If you have questions or want an appointment, call 800-317-9119. Any staff member can schedule a meeting or a phone appointment on our calendars.

Now, every Saturday at 9 AM, you can listen to the Don Creech Show on various radio stations: In the Puget Sound area you have choices for stations: KKOL 1300; KITZ 1400 AM or KGTK 920 AM.