Best of the Week
Most Popular
1. 2019 From A Fourth Turning Perspective - James_Quinn
2.Beware the Young Stocks Bear Market! - Zeal_LLC
3.Safe Havens are Surging. What this Means for Stocks 2019 - Troy_Bombardia
4.Most Popular Financial Markets Analysis of 2018 - Trump and BrExit Chaos Dominate - Nadeem_Walayat
5.January 2019 Financial Markets Analysis and Forecasts - Nadeem_Walayat
6.Silver Price Trend Analysis 2019 - Nadeem_Walayat
7.Why 90% of Traders Lose - Nadeem_Walayat
8.What to do With Your Money in a Stocks Bear Market - Stephen_McBride
9.Stock Market What to Expect in the First 3~5 Months of 2019 - Chris_Vermeulen
10.China, Global Economy has Tipped over: The Surging Dollar and the Rallying Yen - FXCOT
Last 7 days
Stock Market DOW Seasonal Trend Analysis - 23rd Mar 19
US Dollar Breakdown on Fed Was Much Worse Than It Looks - 23rd Mar 19
Gold Mid-Tier GDXJ Stocks Fundamentals - 23rd Mar 19
Which Currency Pairs Stand to Benefit from Prevailing Risk Aversion? - 23rd Mar 19
If You Get These 3 Things Right, You’ll Never Have to Worry About Money - 22nd Mar 19
March 2019 Cryptocurrency Technical Analysis - 22nd Mar 19
Turkey Tourist Fakes Market Bargains Haggling Top Tips - 22nd Mar 19
Next Recession: Finding A 48% Yield Amid The Ruins - 22nd Mar 19
Your Future Stock Returns Might Unpleasantly Surprise You - 22nd Mar 19
Fed Acknowledges “Recession Risks”. Run for the Hills! - 22nd Mar 19
Will Bridging Loans Grow in Demand and Usage in 2019? - 22nd Mar 19
Does Fed Know Something Gold Investors Do Not Know? - 21st Mar 19
Gold …Some Confirmations to Watch For - 21st Mar 19
UKIP No Longer About BrExit, Becomes BNP 2.0, Muslim Hate Party - 21st Mar 19
A Message to the Gold Bulls: Relying on the CoT Gives You A False Sense of Security - 20th Mar 19
The Secret to Funding a Green New Deal - 20th Mar 19
Vietnam, Part I: Colonialism and National Liberation - 20th Mar 19
Will the Fed Cut its Interest Rate Forecast, Pushing Gold Higher? - 20th Mar 19
Dow Jones Stock Market Topping Pattern - 20th Mar 19
Gold Stocks Outperform Gold but Not Stocks - 20th Mar 19
Here’s What You’re Not Hearing About the US - China Trade War - 20th Mar 19
US Overdosing on Debt - 19th Mar 19
Looking at the Economic Winter Season Ahead - 19th Mar 19
Will the Stock Market Crash Like 1937? - 19th Mar 19
Stock Market VIX Volaility Analysis - 19th Mar 19
FREE Access to Stock and Finanacial Markets Trading Analysis Worth $1229! - 19th Mar 19
US Stock Markets Price Anomaly Setup Continues - 19th Mar 19
Gold Price Confirmation of the Warning - 18th Mar 19
Split Stock Market Warning - 18th Mar 19
Stock Market Trend Analysis 2019 - Video - 18th Mar 19
Best Precious Metals Investment and Trades for 2019 - 18th Mar 19
Hurdles for Gold Stocks - 18th Mar 19
Pento: Coming QE & Low Rates Will Be ‘Rocket Fuel for Gold’ - 18th Mar 19
"This is for Tommy Robinson" Shouts Knife Wielding White Supremacist Terrorist in London - 18th Mar 19
This Is How You Create the Biggest Credit Bubble in History - 17th Mar 19
Crude Oil Bulls - For Whom the Bell Tolls - 17th Mar 19
Gold Mining Stocks Fundamentals - 17th Mar 19
Why Buy a Land Rover - Range Rover vs Huge Tree Branch Falling on its Roof - 17th Mar 19
UKIP Urged to Change Name to BNP 2.0 So BrExit Party Can Fight a 2nd EU Referendum - 17th Mar 19
Tommy Robinson Looks Set to Become New UKIP Leader - 16th Mar 19
Gold Final Warning: Here Are the Stunning Implications of Plunging Gold Price - 16th Mar 19
Towards the End of a Stocks Bull Market, Short term Timing Becomes Difficult - 16th Mar 19
UKIP Brexit Facebook Groups Reveling in the New Zealand Terror Attacks Blaming Muslim Victims - 16th Mar 19
Gold – US Dollar vs US Dollar Index - 16th Mar 19
Islamophobic Hate Preachers Tommy Robinson and Katie Hopkins have Killed UKIP and Brexit - 16th Mar 19
Countdown to The Precious Metals Gold and Silver Breakout Rally - 15th Mar 19
Shale Oil Splutters: Brent on Track for $70 Target $100 in 2020 - 15th Mar 19
Setting up a Business Just Got Easier - 15th Mar 19
Stock Market Elliott Wave Analysis Trend Forercast - Video - 15th Mar 19
Gold Warning - Here Are the Stunning Implications of Plunging Gold Price - Part 1 - 15th Mar 19
UK Weather SHOCK - Trees Dropping Branches onto Cars in Stormy Winds - Sheffield - 15th Mar 19
Best Time to Trade Forex - 15th Mar 19
Why the Green New Deal Will Send Uranium Price Through the Roof - 14th Mar 19
S&P 500's New Medium-Term High, but Will Stock Market Uptrend Continue? - 14th Mar 19
US Conservatism - 14th Mar 19
Gold in the Age of High-speed Electronic Trading - 14th Mar 19
Britain's Demographic Time Bomb Has Gone Off! - 14th Mar 19
Why Walmart Will Crush Amazon - 14th Mar 19
2019 Economic Predictions - 14th Mar 19
Tax Avoidance Bills Sent to Thousands of Workers - 14th Mar 19

Market Oracle FREE Newsletter

Stock Market Trend Forecast March to September 2019

US Stock and Investment Portfolio Update - 18th Feb 07

Portfolio / Investing Feb 18, 2007 - 09:49 AM GMT

By: Robert_Moore

Portfolio The Permanent Portfolio fund hit a new record high this week. Everything just keeps going up and up and up... Where will it stop and what will stop it? What asset classes will bring it down a bit? What's relatively high and low right now? I have no clue where it will stop and what will stop it, but I do know what asset classes are relatively high or low. That's what we look at in this weekly review.


Gold:

Gold:

Gold has continued to hang slightly above the one standard deviation, "Shed", mark all week. I'm not buying or selling right now. I am bullish on gold so I always buy when the price gets close to the 180-day Moving Average and I back up the truck and load it when the "Accum" trigger is hit, now at -.37. If you are building your portfolio, you might want to wait for the next dip. If you are in sell-mode the past few days would have been a-good-a-time-as-any to sell a few coins to get you through the month. If you are balancing your Permanent Portfolio to get gold to 25% selling now is OK. Put the proceeds into the Long Bond or into whatever class you are short.

I buy the physical metal and bury it. I also buy "Paper Gold" in stocks and funds that are highly correlated to the price of gold (e.g. ASA, GLD, TGLDX, etc.). When I get ready to sell the first thing that goes will be the paper. I'll hold the physical metal until the end.

Note to kids: I got a creepy email from some guy that is spying on me so I moved the gold map. You can find its new location by reading the laser engraving on the cat whisker that's in the safe where I keep the automatic weapons. You can use the microskop that I bought you for Christmas when we were in Germany. It's in with the beanie babies in the attic. Love, Dad.

Bonds:

When I'm buying I either buy the actual 30-year bond or TLT.

Bonds are starting to move relatively higher. I always buy when the "Accum" trigger is hit and the price is below the Median, now at -.56 and 10.26 respectively. If you are just starting to build your portfolio, now is an OK time to accumulate the long-bonds. I need to rebalance a little bit as I've got too much in the Cash asset class so I'll likely buy some bonds next week.

When I'm buying I either buy the actual 30-year bond or TLT.

Stocks:

The S&P500 just wants to ride along the plus one standard deviation line

The S&P500 just wants to ride along the plus one standard deviation line. It briefly poked into "Shed" last Thursday. How long can this go on? It's been good for my 20% or so that's invested here but I hate to rebalance and buy now.

I am bearish on Stocks so I always buy when the "Accum" trigger is hit and the price is below the Median, now at -.88 and 17.68 respectively. It looks like I'm going to be waiting a while... I know this graph looks bullish but if you are just starting to build your portfolio I would wait to see what happens next week...next month...maybe next year. Be patient and wait for the correction. Remember, you can hold as much as 35% of your portfolio in cash and still be compliant with the strategy (I'm over that now myself). If you're selling, watch the S&P500 and if it goes up next week shed a few shares to balance your portfolio or use it to treat yourself and your family.

I'm currently speculating on the energy and defense sectors as it seems we're going to be in this war for a while. Heck, you can't do anything about it so you might as well try to make some money.

Cash:

I just bought another T-bill yesterday...whatever... I believe something is going to give and I want to have some cash available to take advantage of it.

I speculate in Yen and Swiss Francs. That's about as boring and unprofitable as it can get these days. No interest...No glory...No fun... Tracking Yen on my charts, however, shows that it has moved out of the "Accum" region and is only about .0004 below median. Whoopee!

I'm just you're average Bob so I get no points for suggesting www.everbank.com as a potential vendor for your transactions but I use them to buy foreign currencies. It seems to me that in order to play the currency game you've got to be ready to speculate about $250K in it so unless you want build to that position you might as well forget about it.

The Permanent Portfolio Fund:

The Permanent Portfolio Fund:

The Permanent Portfolio Fund is trading in the Strong Sell region (two standard deviations above the 180-day moving average) and set another record last Thursday. PRPFX has been trading above the MA for quite a while and I believe the approach used helps to support this general trend.

Playing the Permanent Portfolio Game:

Harry Browne suggested an allocation of 25%/each to gold, stocks, bonds and cash. He said that this would produce a return of 8% if followed carefully and rebalanced annually. I have no reason to doubt it and if one looks at a similar portfolio, PRPFX , one will see that this approach has worked fairly well. We haven't seen a huge drop in any of these asset classes over the past history of this fund and the approach seems logical to me so I'm going to stick with it. The long-term graph seems almost ridiculous! Gold and stocks have both been moving up during the almost parabolic increase in PRPFX. I'm interested to see what happens when one of these classes starts to break down. The near-term past has been very good to us.

There are two simple scenarios that I try to consider in this weekly post:

  • You are working and have money to invest in a Permanent Portfolio
  • You are retired and are living off your Permanent Portfolio

I am working and have income to invest so I'm looking for investments that are relatively cheap among the four investment classes and buy them. Others may be retired and are living off their portfolio. For those selling, I try to identify the classes that are relatively expensive and are candidates for selling and/or re-balancing to maintain a 25% allocation to gold, stocks, bonds and cash.

Harry Browne believed that one should have a plan for investing and divesting that was simple and would not require constant maintenance and worry. Through these posts I try to identify the investments that are relatively high or low so that you can quickly see what of your current portfolio may need attention. You should never be put into a position that you are constantly worried about your investments. Harry's Permanent Portfolio strategy, does, in fact, give one "peace-of-mind" but when you want to either invest or divest it's helpful to have some guideposts.

Summary:

I am currently accumulating short-term T-Bills and may buy some long bonds next week just to keep myself in balance. I remain waiting for Gold and Stocks to become more reasonable before I start buying more. If you are just starting out now to build your Permanent Investment Portfolio, long-term bonds and cash would be a good place to start as they are relatively cheap.

Stuck on the runway for 11 hours without a smoke, nicotine gum or a patch, damn-it!

By Robert Moore

Robert Moore was educated as a geographer with a specialty in Geographic Information Systems and Climatology. Between 1980 and 1995 he was engaged as a consultant in the implementation of some of the largest digital mapping projects in the world. He is now the owner of a high-tech real estate information systems technology company that services over 50,000 REALTOR users in the United States.

Disclaimer - This Portfolio is provided for general information purposes only and not a solicitation or recommendation to enter into any market position, and you are reminded to seek independent professional advice before entering into any investments or trading positions.


© 2005-2019 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

6 Critical Money Making Rules