WylieMoney Weekly Portfolio Updates!

The WylieMoney 20 Mostly Managed Portfolio took the lead. All the hypothetical portfolios lost money since May 1st, but the funds I hand picked have held up the best.


It was interesting to note that the 20 ETF Portfolio held up better than the Vanguard 20 Mostly Index Portfolio for the week. The trend of the Index Funds not holding up as well during downturns has continued...

WylieMoney 20 Mostly Managed
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Lazy 20 Mostly Index
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JAGIX added to "WylieMoney Slowly"

As promised, I added JAGIX to the hypothetical portfolio I am tracking. I will add the next fund, a Small Cap Value fund, on the first significantly down day in September.

I will give the weekly update for all the portfolios tomorrow. Believe it or not, both Wyliemoney portfolios were down less than 2% and every other portfolio I track was down more than 2%. This portfolio is 1/4 bonds as of today, so it makes sense that it did not decline as much as some of the others, but the WylieMoney 20, Mostly Managed portfolio continues to hold up much better than the Lazy 20 Mostly Index portfolio.

I'm adding JAGIX to my hypothetical portfolio today

I'll write more later tonight, but today is the day I will add $2500 in JAGIX to the WylieMoney Slowly portfolio.

Keeping an eye on the Musicians' Village in New Orleans

Earlier this year I was fortunate enough to be part of a team from Berklee College of Music that traveled to New Orleans to volunteer with Habitat for Humanity to help build a Musicians' Village.

I wanted to track the progress of the Musicians' village and the surrounding area so I took some screen shots of the area we were working in from Google Maps and from Zillow.

These sites update their satellite images infrequently so the last shots they have do not even show the houses that were already built when we were there. When they update their images, I'll zoom in and report back.

It will be interesting to track Zillow in particular as this site tracks home value information. I am not sure how much info they will gather on the Ninth Ward but I hope they track data from this area and I hope the value there grows!

Click here for the Google Maps View of where we worked in New Orleans!

This row of houses...


...are on the block indicated below:


Click here for a view of a nearby house in zillow.com.

The houses we worked on at the end of our week...


...are here:


The large cleared area is fast filling up with homes. Note the house showing $0. Directly across the street in the image, there is only grass, but there are already dozens of homes there worth a lot more than $0!


Here is a view from the middle of the field, back in June.

Trying to get a response from Etrade... again.

Ever since Etrade became my brokerage, I have encountered problems with the allowable dollar amounts their interface permits.

Back in May, the minimum allowed amounts for subsequent investments through an AIP plan changed in Etrade's interface for two of the funds I own despite no changes at their respective Mutual Fund companies.

Then Etrade fixed the issue and I was pleased.

Then one day I logged in and it was broken again, for one of the funds.

So I called the local Branch in Boston many weeks ago and have heard nothing but crickets.

Today, I sent a request in through my account.

As always, I'll keep you posted. Below is the issue, as I reported it.

----
The mutual fund WFIVX has a minimum additional investment amount of $100. Your web site has the minimum set at $1000. You actually fixed this for me over a month ago but now it is broken again.

You can see right here where the fund company states that any additional contributions allow $100 minimum:

http://www.wilfunds.com/fees_minimums_dow_5000.html

You can see here where morningstar.com advertises that you offer this fund with an AIP allowing $100 contributions:

http://quicktake.morningstar.com/fundnet/Purchase.aspx?Country=USA&Symbol=WFIVX&fdtab=purchase

I have called the representative at the Boston Branch who coordinated this issue when you fixed it the first time over a month ago and have yet to hear back. I have tried to invest on two separate occasions but due to this bug, have been unable to execute my transactions.

You can read about this issue on my blog at http://wyliemoney.blogspot.com/

Please let me know if you have any questions.
----

What happened Friday?

Beats me! One guess would be that a lot of active traders did not want to go into the weekend holding long positions, assessing that the risk of more bad news- relating to credit liquidity, commodity prices, the value of the dollar, etc. could have cropped up over the weekend and sent the markets down even further today.

Well, Friday would have been the perfect day to add to the WylieMoney slowly portfolio, but I missed out on it. If I do not note that I want to invest in a mutual fund by 3:30 give or take, so I could actually place the order to buy through a brokerage, then I do not add it to my hypothetical portfolio. Since I work a day job, I am not always in a place I can see where the market is heading and take a break for a few minutes to note the decision.

I don't sweat the details though. If this style of investing is not easy and low maintenance, then it is not serving its purpose.

Today looks like an up day, so I will continue to wait to add JAGIX to WylieMoney Slowly.

I'm actually on the ferry back from Martha's Vineyard right now- had a wonderful long weekend with some friends!

In the coming weeks I have a lot of research to do as some folks over at the Morningstar.com discussion boards have been looking at my little experiment here and pointing out some issues, making recommendations and asking great questions.

I'm also thinking about putting the portfolio updates on a regular schedule. Let me know if you have any suggestions. I'll probably make it a Friday feature.

More soon!

Index portfolios recovering quicker but...

...they have a way to go yet. WylieMoney is still in the lead.


When I put together a portfolio of 20 funds, one fund in each of 20 different fund categories, and then picked the 20 Vanguard Index funds that covered the same 20 categories and started tracking their performance, I assumed the hand picked funds would not keep up. I also assumed that the index funds would be better from a capital gain/ tax perspective. So both assumptions, have turned out wrong.

I limited myself so the funds I picked are not the best funds out there. My criteria:
* Open to new investors
* Available through one brokerage (I used Etrade)
* Had to be a NTF- No Transaction Fee fund. So no fees, no loads.
* An initial investment minimum of $2500 or less
* A subsequent AIP investment minimum no greater then $100

Some of my best choices are rated 2-3 stars (ACFFX for example). But during the recent assault...

...my WylieMoney portfolio wupped up on the "Lazy Vanguard Index Portfolio" like nobody's business.

I picked an equally weighted portfolio of three Vanguard total market funds covering Domestic and International Stocks and bonds in equal weight by category of the 20 fund portfolios and it has fared better than the 20 Vanguard funds, but WylieMoney is still in the lead. At least it is back above $50,000!


Over the last two days, the WylieMoney portfolio has not risen as much as the Vanguard portfolios, but it remains ahead. When the markets tanked, the index portfolios really suffered.

More surprising to me was the realization that Morningstar shows that the WylieMoney portfolio has 11.96% Potential Capital gains exposure and a 35.85% Average Turnover Ratio compared to the Lazy 20 which has a higher Potential Capital Gains exposure of 15.13% and a Turnover Ratio of 36.20%. And the 3 index fund portfolio has a Potential Capital Gains Exposure of 20.83% with a lower 12.35% Turnover Ratio. Since I was thinking of this as a non-retirement account- that makes a difference.

I admit I do not understand in great detail all the complexities of how to accurately assess tax impacts of all the individual funds- international funds, REITs, etc all of which are in these portfolios. But if portfolios turn over a lot- meaning the fund managers are selling stocks and buying different stocks more often, and the capital gains exposure is high, meaning tax is owed on profits, then when the taxman comes, you take a larger hit.

And everything I have read in the press has led me to believe that index investing is MUCH more tax efficient than picking a bunch of low (relatively low!) barrier to entry managed funds.

So all in all, a good week. Plus, I saw the Police at Fenway Park last Sunday!


The details (click for a larger view):