Model Portfolio I = Down 39.7%Source: Bob Brinker's January 2009 "Marketimer" newsletter.
Model Portfolio II = Down 37.4%
Model III (balanced) = Down 23.9%
- The Wilshire5000 "total stock market index fund" at Vanguard, VTSMX (click for charts), was down 37.04%
- The total bond fund at Vanguard, VBMFX (click for charts,) was up 5.05%
Model Portfolio II, down 37.4% in 2008, was 100% invested in equities for all of 2008.
Bob Brinker's "balanced" Model III, down 23.9% in 2008, started 2008 with 64% in equities. This allocation shows just how bullish Bob Brinker was at the start of 2008. This bullish allocation hurt his performance relative to the "balanced benchmark."
When my writing partner, David Korn, and I began publishing The Retirement Advisor, we considered the universe of what people approaching or in retirement could invest in for their golden years. Many advisers were chasing stock market gains. Other advisers were chasing yield on the fixed income side. We believed that neither was the right approach and decided that our Model Portfolios would be constructed to benefit in up markets, but also be able to weather down markets such that our subscribers could preserve their capital in a reasonable manner, but take the appropriate risk, depending upon an individual investor’s comfort level.
Our Model Portfolio III has the goal of capital preservation in both up and down markets. That portfolio is up over 12% since inception and it gained 3.7% in 2008. Our model portfolios I and II take more risk with equities so they were down in 2008, but they managed to hang on to most of their 2007 gains and perform very well relative to the benchmarks as well as Brinker's portfolios.
My other newsletter, "Kirk Lindstrom's Investment Letter," is for more aggressive investors who what to use my "core and explore" strategy where you add individual stocks for enhanced (at least so far so good) returns.
Since 9/30/98 inception, "Kirk's Newsletter Explore Portfolio" is UP 390%
vs. the S&P500 UP only 51% vs. NASDAQ UP only 57% (All through 12/31/11)
(More Info, Testimonials & Portfolio Returns)
Latest 2012 Update: Up 10.5% YTD as of 2/8/12
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