Saturday, August 05, 2006

7/31/06 Model Portfolio Updates

NoTouch Portfolio. The NoTouch Portfolio outpaced all the major market indices for the month and continues to outperform them for the year as well.
July performance:
NoTouch: +.8%
vs
Dow: +.3%
S&P 500: +.5%
Nasdaq Composite: -3.7%
Nasdaq 100: -4.2%
.
Year to date performance:
NoTouch: +6.7%
vs
Dow: +4.4%
S&P 500: +2.3%
Nasdaq Composite: -5.2%
Nasdaq 100: -8.3%
.
The NoTouch Portfolio was implemented at the onset of 2004. It was designed to be a 'set it and forget it' portfolio. It has outperformed its benchmark competition from the beginning. I think it would do better if readjusted annually, and if I had to do it over again I would change some of the components and percentages. But it is just for fun and has done its job. It tends to underperform the market averages when the markets are strong and to outperform them when the markets are weak. The NoTouch has consistently provided positive benchmark beating returns since inception.
...The NoTouch was originally constructed as follows:
OAKBX 30% - Balanced fund, mix of stocks and bonds, usually about 60/40 ratio.
OAKGX 15% - Value stock fund has both U.S. and foreign stocks in it
BBHIX 15% - TIPS, has underperformed but coming to life now and paying dividends again
PEMDX 10% - Emerging market bond fund
PSAFX 10% - Does better in poor markets, defensive, metals, currencies, etc.
TGLDX 10% - Precious metals
ICENX 10% - Energy
...I have never rebalanced the fund so the percentages have changed since inception, but the original intent was to just leave it alone. If I utilized this in actual investing (and sometimes I wish I would have), I would look into readjusting the percentages annually to bring them back to the original mix. I haven't run studies on this, but would look into reducing the TGLDX since PSAFX also contains precious metals, and find a natural resources fund for the money taken out of TGLDX. Just guestimating.
.

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