Asset Allocation Strategies, Portfolio Management Strategies Blog

Tactical Asset Allocation Strategy

Tactical asset allocation strategy is a moderately active portfolio management strategy, which includes adjustments of investments with respect to short-term goals. Although the basic idea is to diversify investments and limit risks, investment preferences are given to different asset classes with respect to short-term yield predictions.

Risks Associated with Forex Trading

Although Forex trading is becoming the number one choice for many novice traders to make profit, it is not at all free of risk. There are many other risks associated with Forex trading other than the common ‘trading risk’ that occurs as a result of price difference.

Weekly Stock Trader Newsletter, April 28

The Week Ahead: Despite consumer confidence at its worst level since the early 1980's, S&P 500 non-financial companies first quarter earnings are still benefiting from a stronger global economy and weaker dollar. The FOMC meeting which begins Tuesday will end Wednesday with a decision on interest rates as a 1/4 point cut is now widely anticipated. Also watch first quarter advanced GDP numbers released on Wednesday, the personal income and spending data on Thursday, and an important April employment report on Friday.

Margin of Safety Investing Strategy

Margin of Safety is one of the most trusted investing strategies, made popular by highly successful investors like Warren Buffet. The term – margin of safety – was coined by the father of value investing, Benjamin Graham, in 1934. The basic idea of this strategy is to buy low and sell high.

Benefits and Pitfalls of Simulated Trading

Simulated or Paper trading is so far the best strategy one has to experiment with trading strategies and tools without putting actual money in the market. Simulated trading really favors novice traders to get experienced to the trading systems, technical analysis tools, market behavior, etc. But paper trading has both benefits and pitfalls, and what you get will mostly depend on how you paper trade.

Strategic Asset Allocation Strategy

Strategic asset allocation strategy is a portfolio management strategy, which includes periodical adjustments of investments with respect to the long-term goal. The basic idea is to diversify the investments and limit the portfolio volatility. But strategic asset allocation strategy does not include over-investing in either high-profit or low-risk securities.

NobleTrading Weekly Stock Market Letter, April 22

The Week Ahead: A number of mixed earnings reports didn't stop the DOW from rising over 500 points despite oil prices reaching there highest levels ever. If the market has further to go it will have to digest many more earnings reports plus the existing home sales and oil and gas inventory reports on Wednesday, and the new home sales and durable goods numbers on Thursday. The consumer sentiment reading for April is due on Friday.

Balanced Portfolio Management Strategy

Balanced investing strategies are portfolio management strategies, which are most widely followed by investors. Balanced portfolio management strategy combines the merits of both aggressive and defensive strategies; so that both return and risks are balanced. This strategy suits almost all types of investors who are good in money management and have reasonable risk tolerance.

Treasury Inflation Protected Securities (TIPS)

Treasury inflation protected securities or TIPS are treasury notes which offer fixed-income protected from inflations. They offer guaranteed payments which are automatically adjusted with the rise and fall in inflation rate estimated by Consumer Price Index or CPI. TIPS are also known as Treasury inflation index securities and Real Return Bond or RRB (in Canada).

Consumer Price Index, CPI – Things to Know

Consumer Price Index or CPI is one of the most widely watched economic indicators which give a clear idea about economic situation through 3 different indices. CPI is released by Bureau of Labor Statistics (BLS). The 3 indices include CPI for urban wage earners (CPI-W), CPI for urban customers (CPI-U) and chained CPI for urban customers (C-CPI-U).

CANSLIM Stock Screening Strategy

CANSLIM is a stock screening strategy developed by William O’Neil. CANSLIM is a highly successful strategy for trading/investing stocks as it gives proper guidelines, integrates major investment tactics and keeps minimum subjectivity. CANSLIM is an acronym of various factors a trader/investor should look when screening the stock.

Weekly Stock Market Trading Newsletter, April 14

The Week Ahead: Earnings season starts off poorly with General Electric missing its guidance numbers, a sign that even well diversified companies are being impacted by the credit crises. With consumer sentiment continuing to drop as well, watch the retail sales and business inventory numbers on Monday. The PPI is released on Tuesday while the CPI, housing starts, and the Fed's beige book of economic activity are released on Wednesday. Finally, the leading economic indicators and jobless claims are due Thursday.

Aggressive Portfolio Management Strategy

Aggressive investment management and capital growth strategies are portfolio management strategies which aim at maximizing the return over investment. An aggressive portfolio management strategy often includes high-return high-risk investments such as equities. Aggressive portfolio management requires highest grade of money management and is not at all suitable for those with low-risk tolerance and those with less experience.

Automated Vs Manual Forex Trading

Trading currencies for profit is always a tough practice and traders must be certain about many things. Traders can trade currencies manually or using automated trading systems which follow specific rules or can take a mixed way. Each of the above trading methods holds their own merits and demerits depending upon trading style, brokerage, leverage, currency pair trading, etc.

Stock Market Newsletter, April 7, 2008

The Week Ahead: The 80,000 jobs lost in March makes the third straight declining jobs report fueling speculation that another interest rate cut is coming. The FOMC Minutes released on Tuesday could shed more light on this topic. The wholesale inventories numbers come out Wednesday while chain store sales figures are released Thursday. March import prices are due Friday, the same day the World Bank and G7 spring meeting takes place.

Day Trading and Swing Trading - Comparison

Both day trading and swing trading are active trading practices which require different strategies, techniques, tools and money management. Both day traders and swing traders usually trade in higher volumes with in short time periods for small price changes; and the processes are really fast. Here is a comparison between day trading and swing trading.

Defensive Investment Strategy

As the name suggests, defensive investment strategy is the portfolio management strategy which aims at investing in low-risk products. Defensive investors choose bonds, treasury notes, money market funds, and defensive stocks. Defensive stocks include stocks which are undervalued, less volatile, steadily growing, and/or offering reasonable dividends. Defensive investors must be very strict with their money management and investment product selection.

Lagging, Coincident and Leading Indicators

All the above three are economic indicators showing/predicting past, current and predicted economic trend of a country or market. They can be very useful tools for investors and long-term traders if interpreted correctly. Lagging, coincident and leading indicators are prepared from economic data collected/released by government or non profit organizations, like GDP growth, unemployment rates, agricultural and industrial performance, crude oil and metal price, currency exchange rate, etc. They can be used independently or in conjunction.

Bracketed Orders - Information

Bracketed orders are used to limit trading risk and to lock profit by creating a bracket in both directions. Bracket orders come handy when the trader is not sure about the price trend of stock, or he lacks the time to monitor the stock market, or he is trading on news and rumors. Bracketed orders are of two types - bracketed buy orders and bracketed sell orders.

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