Rich Man’s Allocationby alphadawgg on August 20th, 2008 at 1:58 am |
Allow me to share with you my current “top-down” allocation—for the wealthy. In this market environment, with all the uncertainty….
Cash 25%
Fixed income 20%
Equities 40%
Alternatives 15%
These allocations can change any day at any time. They are not static, but tactical bets.
Even though it may seem like I’m a market bull right now, I’m really not. I just invest when and where I see opportunity.
That said, there is still a lot of risk out there. Minefields and unresolved issues. That’s why I’ve only allocated about 40% of my total investment portfolio to stocks, of which I’ve outlined certain sectors and names I like and have bought here recently.
Keep in mind, that even though I’ve waded into some bank names, they are ticking time bombs. The problems in the banking industry will not be in a hurry to disappear anytime soon, so trade in and out of the banks as the opportunities arise. This is where the action is, no doubt.
In closing, don’t be so sure about the relationship (inverse correlation) right now between oil prices and the stock market, either. It’s possible that we could see oil prices and stocks start to move in tandem. Should they move down together, that would be signaling a much bigger problem for us all. So don’t gamble your future, which is uncertain.
Better to adopt the Rich Man’s Allocation….more on this later….
You rookies, who have a long bias, better pay attention to Alpha. He is a seasoned pro who knows his stuff.
Being long is tough in this tape and Alpha has a pretty good game plan.
August 20th, 2008 at 2:10 amHey, have you seen the chinese markets!!!
Rumor of meeting to be held “to bring major brokers behind closed doors and get the markets rallying again.”
After losing the most compared to the world, the chinese market may get “loosened” monetary policy and some 400 billion yuan to stimulate growth. (1.5pct of gdp of china; 58 billion dollars)
i feel sorry for the FXP holders. Even i couldn’t have seen this coming.
August 20th, 2008 at 2:18 amWhat’s the big deal?
Are you braindead?
Up 5.5%, after going down 55% means nada.
Standard action. I am not impressed.
August 20th, 2008 at 2:37 amSorry Fly i didn’t mean that china’s foolproof from global credit crunch. But considering the difference in psychology of chinese markets, and how chinese markets have performed, i came to a conclusion that the only place that can boom now is in the asian markets. Call me biased, but i believe the chinese know their markets.
Actually FXP may be ok after a while, but this week i expect it to go down fast. Since FXP is inv FXI which has most of its holding in financials, it may hold 80 next week.
August 20th, 2008 at 3:02 amI think China doesn’t know what it’s doing when it comes to the stock market. Lord knows what will happen now … will there be a five-year plan to improve their equity markets via central meddling. I am wary of any assumptions other than China attempting to secure more control over foreign soures of needed commodities such as metals or coal.jmho.
Great.post Alpha.
August 20th, 2008 at 4:42 amwell the low risk long trade setup on the XLE from yesterdays open has worked like a charm. There is another low risk long trade setup coming up in the CDN banks…. look at the Royal RY-N or RY-T ( interlisted). All 5 big banks report next week starting Tuesday the 26 th RY is out Thursday.
The stocks are drifting lower on light volume…the sheeple are worried of more writedowns/skeletons falling out of the closet. This dawg works on the street and I believe that the worst is behind our banks and folks are reading the US banking headlines and trading out of their CDN bank stocks…. check out the yields on these bad boys A Dawg…certainly should have a spot in your wealthy mans best friend portfolio.
The preferreds pay even fatter yields and many of the series are perpetuals…..
TD-TSX
August 20th, 2008 at 10:38 amBNS-t
CM-t
BMO-t
RY-t
volume is tracking quite heavy today on the SPY…looking at ~ 300 M shares… aclose below the local swing point of 126.38 from Aug 8 th on this type of volume sets up a move down to 123 ish…..
monster volume in Fannie and Freddie are going to help drive the SPY volume today….by 3 today we should geta good idea whether or not the market can hold here. I don’t think it can and added more to my earlier foray into the inverse ETF’s…QID SDS TWM…..closed my energy trade already…only taking what the mistress of the market wants to give me
August 20th, 2008 at 11:55 amI think anjing is right.
Canadian banks are an interesting lot, no doubt. I own BNS and RY.
Compare RY performance the past 12 months to C, BAC,MER, UBS and MS. No comparison.
Off to another meeting….
August 20th, 2008 at 1:14 pmvolume has dried up after 11 am today….not going to get anywhere near 300M on the day…looks closer to 215M….daily basis its not enogh to take out the swing from August 8 th BUT it is increasing the pressure on that point. In other words the market is holding right above these lows as it builds cause to bust thru the swing….soon enough the market will reveal its intentions.
I could care less which way the market wants to go…I only care about getting on the right side of the tape. As Friday draws near lets see if the market participants want to be long over the weekend…smile….
August 20th, 2008 at 2:51 pmanjing–
I’m glad your Blue Jays beat the Yankees last night. Thank you.
Go Sox!
August 20th, 2008 at 5:33 pmwe were in the box last night with a bunch of clients AJ was good last night….we are looking to sweep the yanks!
August 20th, 2008 at 5:55 pmAD, RY has taken advantage of their currency and balance sheet to acquire quite a few U S banks and looking in Europe … trouble [sic] is, they’ve acquired sub-prime exposure esp with some of their southern exposure. While U S firms deleverage, RY is transitioning to be their inverse via acquisition of troubled assets ala Wilbur Ross and BAC … Odd, No? Maybe it works for them at 10 cents on the Looney.
PS: Pedroia opens with a triple … Buchholtz is due!
August 20th, 2008 at 7:12 pmBucholz needs to go back to the farm. His head isn’t screwed on right. Something is messed up there.
Bullpen didn’t fare any better.
Dreadful 11 - 6 loss…plus the Yanks and the Rays won.
August 21st, 2008 at 2:55 amThey’re still in it for the wild card but I’m losing confidence just like Buchholz in our pitching … he needs a win badly and he’s only gunna get it by working on his fastball in the minors … see ya next year Clay!
August 21st, 2008 at 3:23 am[...] a previous post, I shared with you my current “top-down” asset allocation. Unlike the conventional [...]
August 21st, 2008 at 7:53 pm