Posts

Posted on

A Simple Way To Avoid Unpopular REIT Segments (REZ)

Summary

  • After reading a recent article about avoiding VNQ because of exposure to retail, office and hotel REITs, I came up with a simple solution.
  • I found three REIT ETFs that cover the other areas of the REIT universe and avoid those segments.
  • As a group, the three ETFs I examined have performed well.

Continue reading at Seeking Alpha right here:  https://seekingalpha.com/article/4261463-simple-way-avoid-unpopular-reit-segments

Posted on

Closed a Position in Our China / India ETF (FNI) 5-7-19

Today, we closed one of our positions in the First Trust Chindia ETF (FNI). I don’t foresee any problem holding this ETF long-term. This position was only closed to facilitate moving money from our TD Ameritrade brokerage account to our M1 Finance brokerage account. We are continuing to invest in FNI in both our TD Ameritrade IRAs and our M1 Finance brokerage account. Read why we invest in FNI right here: Own BABA BIDU BZUN CTRP EDU INFY JD MOMO WB WUBA YUMC YY With 1 ETF!   Also right here: Best Long-Term Performance China Equity ETFs 1.1    Price paid $34.90. Price sold $36.63.

HOW WE PREFER TO CLOSE A POSITION IN AN ETF:

  • On 3/20/19 we were approaching a 10% profit in this position
  • On 3/20/19 I set a 5% trailing stop contingent order to be triggered when we hit a 10% profit
  • On 4/5/19 this order was triggered at a price of $38.39
  • On 5/7/19 FNI fell in price sharply and our 5% trailing stop found a buyer at $36.63
  • We netted 4.95% after the sale was completed (not including dividends received during ownership)

 

 

Posted on

TD Ameritrade to Add 255 ETFs to No-Commission Platform (569 Total)

The platform takes a huge leap in the number and variety of funds on offer.
By Janet Levaux | May 06, 2019 at 09:36 AM

TD Ameritrade says its commission-free ETF platform will nearly double in size next month, jumping to 569 exchange-traded funds from 314. The funds will come from 21 providers and cover about 90 Morningstar categories.

See complete list right here: https://www.tdameritrade.com/retail-en_us/resources/pdf/TDA1000835.pdf

Read the complete article at ThinkAdvisor right here: https://www.thinkadvisor.com/2019/05/06/td-ameritrade-to-add-255-etfs-to-no-commission-platform/?slreturn=20190407021005

 

Posted on

Best Long-Term Performance Diversified Emerging Markets ETFs 1.2

  • The largest and one of the oldest Diversified Emerging Markets ETFs has outperformed an S&P 500 index fund by 0.95% CAGR over the last 16 years
  • One older Emerging Markets index mutual fund has outperformed an S&P 500 index fund by 2.57% CAGR over the last 20 years
  • The Emerging Markets asset class has been the #1 or #2 best performing equity asset class in 7 of the last 15 years
  • Emerging Market equities are generally riskier and more volatile.
  • Diversified Emerging Markets ETFs can help investor diversify into these markets with less risk
  • There are 79 ETFs available in the Morningstar category “Diversified Emerging Markets”. 12 of these funds have been available for 10 years or longer

The iShares MSCI Emerging Markets ETF (EEM) is the largest and one of the oldest available ETFs in the Emerging Markets asset class. It was launched on April 7, 2003. Since that time, EEM has had a compounded rate of return of 10.39%. An S&P 500 index fund returned 9.44% CAGR over the same period. This outperformance came with a price though, and that price is called volatility. In the case of EEM, it’s standard deviation (a measure of volatility) was 21.97% while the S&P 500 was only 13.38% (lower mean less volatility). Other ways to demonstrate how this volatility (risk) relates to performance (reward) are the Sharpe and Sortino ratios. Typically, the higher these ratios, the better the risk vs reward ratio. In the chart below, the S&P 500 funds’ Sharpe & Sortino ratios are both higher than EEM. So, with all this additional risk, why should long-term investors consider allocating part of their equity portfolio to Diversified Emerging Markets? My answer is diversification. Diversification has oft been quoted as the “only free lunch in investing”. As a long-term investor and an investment blogger, I have made it my mission to find and invest in as many different equity asset classes as possible without degrading long-term performance. Diversified Emerging Market funds can be  a useful component in a worldwide equity portfolio because they have the potential to lift long-term performance while simultaneously reducing overall risk. The risk reduction can be found in this asset class’ correlation to U.S. Markets. Once again, referring to the chart below, this asset class has a correlation to U.S. Markets of 0.79. This is a favorable number, because the lower the number, the lower the correlation to U.S. Markets, so long as the asset class does not perform poorly long-term.

EEM vs S&P 500 index fund: May 2003 – March 2019

Source: https://www.portfoliovisualizer.com/

EEM vs SPY: April 11, 2003 – April 21, 2019

Source: https://www.koyfin.com/home

Continue reading “Best Long-Term Performance Diversified Emerging Markets ETFs 1.2”

Posted on

Is The South Africa ETF Worth The Risk? (EZA) 1.2

  • This single-country emerging market fund has compounded at 9.38%/year over the last 16 years
  • EZA has a low correlation coefficient to U.S. Markets of 0.65
  • Emerging markets are volatile. EZA is even more volatile than diversified emerging market funds
  • EZA, a prime example for the “No Pain, No Premium” theory
  • EZA has a current 12-month trailing yield of 3.67%

EZA vs S&P 500 index fund: March 2003 – March 2019

Source: https://www.portfoliovisualizer.com/

EZA vs SPY: February 7, 2003 – April 14, 2019

Source: https://www.koyfin.com/home

Continue reading “Is The South Africa ETF Worth The Risk? (EZA) 1.2”