Indexfundfan\’s blog (new URL is

May 22, 2006

Are you overinvested in emerging markets?

Filed under: Investing — indexfundfan @ 4:46 pm

Emerging markets retreated with a vengence in recent weeks, much to the dismay of many new emerging market investors:

NEW YORK, May 22 (Reuters) – Major Latin American stock, bond and currencies plummeted on Monday, and stocks were on their way to post their biggest one-day drops in two years, as investors stampeded out of emerging markets worldwide fearing higher interest rates and slumping commodity prices.

The decline followed earlier slumps in Europe and Asia. Turkey’s stock market fell 7 percent, and the Indian bourse fell 10 percent, prompting a one-hour suspension tradimg suspension.

The Indian bourse closed nearly 4 percent down, at a 10-week low. Hong Kong stocks closed off about 3 percent showing their biggest fall in two years.

In Moscow, Russian shares crashed Monday in their biggest one-day percentage slide since 2003, forcing the MICEX exchange to suspend trading after its main index fell by 11 percent. That accelerated a nine-day selloff which has sliced over a quarter off the value of Russian stocks.

The sad part is that many of these investors only recently decided “to diversify into emerging markets”, having been enticed by the many emerging market funds’ recent performance numbers.

The ones that really believe that emerging market equties would add to their portfolio diversification would stay the course and continue to DCA according to their asset allocation plan. However, I believe we will see a fair number of them running for the exits very soon.


May 3, 2006

Easy allocator

Filed under: Investing — indexfundfan @ 10:48 am

Easy Allocator is an interesting tool created by Diehard Nick (yobria) for performing asset allocation planning. It includes the following asset classes: commodities, foreign bonds, REIT, overweight value/small, micro-cap stock, equal weight Europe/Pacific/Emerging markets, equal weight Pacific rim and foreign small-cap. The popular portfolios like the Coffeehouse, Bernstein-4 and the Couch Potato are included as well. It even includes a forecast of portfolio performance. Try it!

Portfolio return for April 2006

Filed under: My Portfolio — indexfundfan @ 10:35 am

April 2006 has been another good month. My portfolio of 70% equity / 30% fixed income returned 1.92%. Overall, the portfolio YTD return is 8.81%. What’s particularly strong this month included EAFE large-cap, EAFE small-cap, emerging markets and precious metals / resources equity.

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