CapitalTime
Articles on investing and capital management, with a quantitative focus.
Topics
#bigpicture - Big picture thoughts
#prp - Permanent Risk Parity (how I invest)
#xiutop - Top stocks of XIU index
#growth - My portfolio of growth stocks
2024-11-10
Expect a Correction
This post will be "stating the obvious", but sometimes I like to remind myself of these things. Markets don't run straight up, forever... #prp
2024-10-06
Why Gold?
Someone recently asked me why 20% of my portfolio is invested in gold. I put together a list of reasons, and will share them here... #bigpicture
2024-07-07
Updated PRP Allocations
I made a small change to my PRP allocations. The new targets are 40% Stocks... 40% Bonds... 20% Gold... #prp
2024-06-28
Growth Portfolio Annual Update
My Growth stock portfolio continues to outperform the Canadian index. I screen for profitability, momentum, and low beta (volatility)... #growth
2024-06-23
Some Excellent Podcast Episodes
I enjoy listening to the Rational Reminder podcast. They cover a pretty wide range of investing topics, discuss research, and have some... #bigpicture
2024-05-29
Preparing to Update My Asset Allocation
I have not yet changed my 'official' (published) PRP allocations, but am preparing to update my allocations... #prp
2024-03-22
Eight Year Portfolio Anniversary
I started my PRP portfolio exactly 8 years ago. Over these years, PRP has returned 6.0% CAGR... #prp
2024-01-26
Shutting Down BullSignals
I've been using this trend-following algorithm (BullSignals) for a few years, and began trading a dedicated account in January 2020... #bullsignals
2024-01-17
PRP Annual Performance
The PRP allocation was up 10.6% in 2023. This was one of the stronger years in my historical data... #prp
2023-12-22
XIU.top Update
There is no change to the XIU.top portfolio this year, and the holdings have remained the same since 2020. The portfolio is designed... #xiutop
2023-12-15
New All Time High in PRP
My PRP asset allocation reached a new all time high this month. This finally ends a rather long (nearly 2 year) period where the portfolio... #prp
2023-11-28
Peeking at Asset Class Performance
I try to focus on my overall portfolio performance, but today I peeked at the individual asset classes to look at how they... #prp
2023-10-20
Why Invest in Bonds?
Bonds have performed very poorly in the last 3 years, with negative returns in 2021, 2022, and 2023 so far. The recent terrible performance... #bigpicture
2023-10-03
Sold All Growth Positions
I'm trying something new with my Growth portfolio. Over several years, I have observed that my stocks track the benchmark index... #growth
2023-08-21
Another Sell Signal
My market timing algorithm gave a Sell signal on August 21. This is the fifth signal this year, which is more than I would like to see... #bullsignals
2023-07-18
Don't Believe the Forecasts
Analysts and economists frequently appear in the media, giving their forecasts for all kinds of things - recessions, inflation, interest rates... #bigpicture
2023-06-25
Growth Portfolio Annual Update
My Growth stock portfolio continues to outperform the Canadian benchmark. I screen for profitability and price momentum... #growth
2023-03-25
Seven Year Portfolio Anniversary
I started my PRP portfolio 7 years ago. Over these years, PRP has returned 5.6% CAGR. This return is somewhat lower than... #prp
2023-02-09
Volatility and Risk-Adjusted Return
One of the main goals of my PRP portfolio is to have lower volatility, and (by extension) a better risk-adjusted return... #prp
2023-01-11
Listen to the Federal Reserve
These comments are about the US Federal Reserve (or "Fed") and their policy interest rate. The Bank of Canada usually follows... #bigpicture
2023-01-05
PRP Annual Performance
The PRP allocation declined -7.5% in 2022. This was the worst calendar year loss in my historical data... #prp
2022-12-28
Rebalancing My Portfolio
To maintain my portfolio allocation targets, I make sure that I invest new money into whichever asset(s) are the most underweight... #prp
2022-12-27
Why You Should Not Use My Risk Parity Portfolio
I post about my risk parity portfolio frequently on this personal blog or investing journal, because it's how I invest... #bigpicture
2022-12-02
Market Turning Bullish?
My market timing algorithm gave a Buy signal on November 18, which is the first new signal in ten months. I'm a bit surprised... #bullsignals
2022-10-01
Not a Great Year So Far
Many asset classes have been declining this year. Like most investors, I have a negative return year-to-date (YTD). We are now entering... #prp
2022-09-09
Is This a Market Bottom?
Since we just had a large drawdown (23% drop in stocks), could this be a market bottom and the start of a new rally?... #bigpicture
2022-07-03
Handling Market Declines
The markets have been uncooperative so far this year. As both stocks and bonds decline sharply, I've been reminding myself of a few things... #bigpicture
2022-06-30
Growth Portfolio Annual Update
I updated my Growth portfolio today. My screening process looks for a mix of profitability and price momentum, so it's probably... #growth
2022-05-06
Bonds Are a Good Investment
Researchers have updated (and corrected) historical stock and bond data, providing a more complete picture of historical returns... #bigpicture
2022-04-11
Exiting my Growth Positions
I normally hold all of my growth and momentum stock picks for a set time period, and then re-run my screening to update the portfolio... #growth
2022-03-22
Six Year Portfolio Anniversary
I started my PRP portfolio exactly 6 years ago. Over these years, PRP has returned 6.5% CAGR. This is a good return... #prp
2022-02-10
Yikes, inflation is very high!
Today, the US inflation rate hit a 40 year high. Canada's inflation rate is a bit lower, but still at a multi-decade high... #prp
2022-01-18
PRP Annual Performance
The PRP gained 6.0% in 2021. In the historical context, that's a very average year... #prp
2022-01-02
Rebalancing the Model Portfolio
I record daily values of a "model portfolio" for my PRP allocation. My actual investments are very similar, but not identical, to the model... #prp
2021-12-09
Sell Signal
My market timing algorithm gave a "sell" signal today. It's picking up weakness in non-US markets and projecting that... #bullsignals
2021-12-02
Here's Diversification In Action
The markets have been a bit volatile over the last week. Although this is a very short timeframe, the last week provides an example of how... #prp
2021-11-14
Investment Portfolio Goals
I've been using the PRP investment portfolio for a while now, and thought it would be good to review my goals. Here's what I want... #prp
2021-10-27
Buy Signal
My market timing algorithm gave a "buy" signal today, so I bought the S&P 500 index. Not much time has passed since the recent... #bullsignals
2021-10-01
Sell Signal
My market timing algorithm gave a "sell" signal today, so I sold the S&P 500 index. This is only within a small account... #bullsignals
2021-07-24
Investing With Crash Protection
I have two distinct strategies for investing while also having some protection from crashes and extreme volatility. One is Bullsignals... #bigpicture
2021-07-11
Reflecting on BullSignals During Covid
I continue to run my algorithm-based trend following strategy, to a limited extent. I keep this in a separate account... #bullsignals
2021-06-11
Growth Portfolio Annual Update
My Growth portfolio underperformed the TSX over the last year. Several holdings no longer meet my screening criteria and have been replaced... #growth
2021-06-07
Why I chose XIU and ZSP
Many people have asked why I use XIU and ZSP for the equity components in my portfolio, as opposed to VEQT or XAW... #prp
2021-05-28
Buying Bonds in PRP
When adding new money to my portfolio, I look at my current asset weights to find out where I am underweight. Here's how my portfolio looked... #prp
2021-05-02
Time To Invest In Bitcoin?
No. I already committed myself to a specific portfolio strategy, based on extensive research and modelling. My portfolio is based on... #bigpicture
2021-03-23
Five Years of PRP
I started using this asset allocation on 2016-03-22, and today I am marking the 5 year anniversary. Originally, I was using the Permanent Portfolio... #prp
2021-02-17
Adding back into PRP
I withdrew some of my PRP back in August, and made a commitment to reinvest the money once it was possible to do so... #prp
2021-01-05
PRP Performance
The PRP gained 11.7% in 2020, the second highest annual return in the 25 year history... #prp
2020-12-28
Performance of Growth Portfolio
This is the 4 year anniversary of my Growth portfolio, and I'm going to review the performance of my stock picks versus the benchmark... #growth
2020-11-22
Stocks Are Always Scary
COVID-19 certainly qualifies as a true catastrophe, but it won't be the last stock market disaster. As I pointed out a year ago... #bigpicture
2020-11-02
Adding back into PRP
Earlier, I described a withdrawal from PRP where I sold some of my portfolio during a strong rally in stocks and gold... #prp
2020-10-16
US Version of PRP
In this post, I will present a U.S. version of the PRP. It's essentially the same as the #prp asset allocation I use myself, except for... #prp
2020-09-11
Indexing is Not Passive
Index investing has become more popular in recent years. For example, someone can hold an index fund that tracks the S&P 500 index ... #bigpicture
2020-08-10
Withdrew from PRP
I have one investment account which needs to be liquidated before moving elsewhere. This is a "forced selling" scenario... #prp
2020-08-03
What Happens Next?
Market analysts and commentators love to make appearances in the media and share their predictions about what will happen next. Often, ... #bigpicture
2020-07-25
Mid Year Report Card
I use a number of different investment strategies, each covered in a different section of this web site. The "top level" asset allocation... #bigpicture
2020-06-24
Beware the high premium on MNT
My allocation to gold is currently spread across several different ETFs, as I wrote about earlier... #prp
2020-06-08
Growth Portfolio Annual Update
My Growth portfolio outperformed the TSX in this time period. Several holdings no longer meet my screening criteria and have been replaced... #growth
2020-03-31
Note on MNT for gold exposure
My PRP model portfolio has 20% weight in gold bullion, which I show as MNT in the model portfolio. MNT is nice because... #prp
2020-03-22
Zoom Out to 1 Year
Lately, daily volatility in markets has been extreme. To see things more clearly, I think it helps to "zoom out" and look at the longer term... #bigpicture
2020-03-09
PRP Response to Market Crash
Today saw historic moves in the stock market. The S&P 500 declined 7.6% and Canada's TSX fell an incredible 10.3%... #prp
2020-03-07
Mild TSX Correction So Far
Would it surprise you to hear that this has been a mild stock correction so far? For Canada's benchmark index, this current selloff... #bigpicture
2020-02-27
COVID-19 and Stocks
Posting an article like this one is risky, because at some point in the future, the outcome of COVID-19 will be known... #bigpicture
2020-01-11
XIU.top Update
At year end, I evaluted the XIU.top portfolio and went through the update methodology. Remember that this is not a buy-and-hold... #xiutop
2020-01-09
PRP Performance
The PRP gained 13.3% in 2019, the largest annual return in the 24 year history. This was an unusually strong year... #prp
2019-12-30
Scaling down my market timing
Although my BullSignals market timing has given reasonable results for a few years, I've decided to scale down... #bullsignals
2019-12-27
Growth Portfolio 6 Month Update
My Growth portfolio slightly outperformed the TSX in this time period. Performance has been strong since inception 3 years ago... #growth
2019-11-19
Trouble Investing New Money
Are you having trouble investing new money? Are concerns about an overvalued stock market preventing you from making purchases?... #bigpicture
2019-11-05
I am not a Tortoise
According to Wikipedia, most tortoise species can live to around 100 years, with some living over 150 years... #bigpicture
2019-10-22
Backtesting with the Portfolio Visualizer
One of my favourite investment-related web sites is the Portfolio Visualizer, a collection of analysis tools that can be used to study the behaviour... #bigpicture
2019-09-06
Buy Signal
My market timing algorithm gave a buy signal today, September 6. After two weeks in cash, this resumes a long position in stocks. #bullsignals
2019-08-25
XIU.top methodology
The XIU.top method uses individual stocks to approximate the TSX 60 index by holding the largest weight (largest market cap)... #xiutop
2019-08-21
Sell Signal
My market timing algorithm gave a sell signal today, August 21. This gives a +6.4% total return in XIU and +9.4% total return in SPY.... #bullsignals
2019-08-13
Choosing My Asset Allocation
I've described some details of risk parity, but I should explain how I arrived at my PRP asset allocation. There is no ideal single asset allocation... #bigpicture
2019-08-12
Derivation of a Risk Parity Portfolio
After learning about the risk parity concept, I tried deriving my own portfolio using three uncorrelated assets that I like... #prp
2019-07-26
What is Risk?
As far as I know, there is no universally accepted definition of risk for investment modelling. Modern Portfolio Theory (MPT), introduced by Markowitz... #prp
2019-07-17
I don't know what the market will do
I don't know how the economy will behave, if we'll get runaway inflation, and if stocks will continue to do well. #bigpicture
2019-07-03
Risk Parity Doesn't Require Leverage
There are many variants of risk parity. Some risk parity hedge funds use leverage. Others dynamically adjust weights... #prp
2019-06-24
Risk Parity - Basics
Harry Markowitz, recipient of the Nobel Prize in Economics, called diversification 'the only free lunch in finance'... #prp
2019-06-19
Growth Portfolio 6 Month Update
My growth portfolio outperformed the TSX by several percent in this time period, continuing to show strong performance since inception... #growth
2019-06-13
BullSignals Basics
My algorithm evaluates stock market strength and tries to detect periods of high risk... #bullsignals
2019-06-08
Timing the market is probably a bad idea
I'm aware that it's generally a bad idea to try "market timing". Trading in and out of the market usually gives worse performance... #bullsignals
2019-06-07
Investment goals
Here, I describe my own investment goals to provide context for the articles I write... #bigpicture
2019-06-05
We are shaped by our experiences
Investing can mean different things to different people, and not everyone has the same priorities... #bigpicture