Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24
US House Prices Trend Forecast 2024 to 2026 - 11th Oct 24
US Housing Market Analysis - Immigration Drives House Prices Higher - 30th Sep 24
Stock Market October Correction - 30th Sep 24
The Folly of Tariffs and Trade Wars - 30th Sep 24
Gold: 5 principles to help you stay ahead of price turns - 30th Sep 24
The Everything Rally will Spark multi year Bull Market - 30th Sep 24
US FIXED MORTGAGES LIMITING SUPPLY - 23rd Sep 24
US Housing Market Free Equity - 23rd Sep 24
US Rate Cut FOMO In Stock Market Correction Window - 22nd Sep 24
US State Demographics - 22nd Sep 24
Gold and Silver Shine as the Fed Cuts Rates: What’s Next? - 22nd Sep 24
Stock Market Sentiment Speaks:Nothing Can Topple This Market - 22nd Sep 24
US Population Growth Rate - 17th Sep 24
Are Stocks Overheating? - 17th Sep 24
Sentiment Speaks: Silver Is At A Major Turning Point - 17th Sep 24
If The Stock Market Turn Quickly, How Bad Can Things Get? - 17th Sep 24
IMMIGRATION DRIVES HOUSE PRICES HIGHER - 12th Sep 24
Global Debt Bubble - 12th Sep 24
Gold’s Outlook CPI Data - 12th Sep 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Investment Grade Value Stock Index (IGVSI) Soars 24%

Portfolio / Investing 2009 Aug 12, 2009 - 06:05 AM GMT

By: Steve_Selengut

Portfolio

The Investment Grade Value Stock Index is a barometer of a small but elite sector of the stock market. Some Investment Grade Value Stocks are included in all averages and indices, but even the Dow Jones Industrial Average includes several issues that are below Investment Grade and very few boast an A+ S & P rating.


The IGVSI tracks a portfolio of approximately 400 stocks--- and less than half of them are likely to be found in the S & P 500 average. This new market index was developed in late 2007 to provide a benchmark for the equity portion of investment portfolios managed without open-end mutual funds, index funds, or any of the other popular speculations and hedges that are included in most professionally managed portfolios.

Two related indices (the WCMSI and WCMSM) track portfolios of closed-end income funds. Between the three, they serve as an excellent performance expectation development tool for investment portfolios managed according to the disciplines of the Working Capital Model (WCM). Through July 31 2009, these indices soared approximately 24%---- about five times the growth of the S & P 500 and twelve times that of the DJIA.

The reasons are fairly simple: A diversified portfolio of high quality, dividend-paying equities, combined with an equally well diversified collection of conservative interest paying securities is what investors move into after licking their wounds from failed speculations.

Indices that contain the highest quality, dividend paying equities and a variety of historically solid income producers in a manner similar to a conservative personalized portfolio are valuable in helping investors "fine tune" their portfolio performance expectations and their forward-going action plans. The IGVSI is telling us several things right now:

There should be profits in your portfolios so make certain you don't let any of them slip through your fingers.

Sticking with the QDI (quality, diversification, and income production) safety structure clearly moves you away from market bottoms more quickly than approaches that are based on more speculative methodologies, gimmicks, and hedges. It also puts the brakes on slip-sliding-away market values much sooner than the conventional sell everything low methodology.

Clearly, adding dollars to portfolios during corrections (portfolio income plus regular contributions) is a far more productive approach to investing than loss taking and waiting for Wall Street to tell you when the next upturn is about to begin. Just ask yourself: Have I benefited twenty-plus percent from this five-month rally?

Additionally, individual securities portfolios are much easier to manage and to monitor as to monthly income production than other forms of investing in times of financial chaos. Income produced by the twenty-five closed end income producers in the WCMSI is pretty much the same now as it was when the downturn began in May of 2007--- particularly when you factor in profits and reinvestment of dividends.

Without a doubt, investment portfolios that are able to use the IGVSI, WCMSI, and the WCMSM as their benchmarks are most likely to out-perform the most well known Wall Street benchmarks. They have done so in an environment where congress has killed major institutions and where many interest rate sensitive securities failed to move higher in the face of the lowest interest rates in modern history.

It's time to move away from the speculative underbelly of investing; it's time to build an investment future on a foundation of quality, diversification, and income.

By Steve Selengut
800-245-0494
http://www.sancoservices.com
http://www.investmentmanagemen tbooks.com
Professional Portfolio Management since 1979
Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want YOU to Read", and "A Millionaire's Secret Investment Strategy"

Disclaimer : Anything presented here is simply the opinion of Steve Selengut and should not be construed as anything else. One of the fascinating things about investing is that there are so many differing approaches, theories, and strategies. We encourage you to do your homework.

Steve Selengut Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in