! Model Mutual Fund and ETF Portfolios: Combined Update, Different Strategies
James B. Cloonan is founder and chairman of AAII. He is author of the book "Investing at Level3: Higher Returns With Minimal Risk for the Long-Term Individual Investor".


Sidney from AZ posted over 6 years ago:

Please ask James,ie Jim, if he has ever used the Bayes rule/theorem----and if so what his ]
opinion is for forecasting.
If not, have him look at the NY Times book review section, 8/7/11, page 14, for a new book
by Sharon Bertsch McGrayne.
I wonder if this theorem has any possible qualitative
application in what he does in preparing his
Sid Cohen

James from AZ posted over 6 years ago:

Bayesian statistics can and has been used in investment decision making. There has been renewed interest following all the criticism of Modern Portfolio Theory (Black Swan, etc.) It can be used to change probabilities based on additional info or to add judgements to historic research results. Unfortunately it depends on inputs, such as historical returns and variance, as well as future estimates and these have not proved reliable. The rule of garbage in, garbage out still exists even with more complex models. James Cloonan

Michael from NY posted over 6 years ago:

For James: If you were to "classify" the Model Mutual Fund portfolio, ranging from conservative/income-and-preservation oriented to aggressive/growth- oriented, where would you consider this Model portfolio to lie?

Thank you.

James Cloonan from il posted over 6 years ago:

The Mutual Fund Portfolio is intended to be for the stock portion of a portfolio. As it stands today it is fairly aggressive but diversified enough to avoid extreme risk. If t-bills are "1" and the Shadow Stock Portfolio is "5" it would be "4". James Cloonan

Kaimay from MN posted over 6 years ago:

I just turned 71 been investing our family assets all our lives.(6 portfolios with substantial assts) Enjoyed this challenge most of the time. But as i get older and older, any chance of seeing AAII offer a mutual fund e.g. for your shadow stocks portfolio for your faithful subscribers? Motley Fools did that a few years ago with their fund offering. Many of their subscribers signed on.
I know you feel this will "violate" your mission of teaching folks to be better investors. But your subscribers may be reaching a different stage in life and NEED your help more. I will never let "sales oriented" money managers manage our money.
Please be more flexible with your "mission". You can make it simple and restrict it to minimum of $25K or whatever. But begin with your best performing trade mark shadow stocks. Thank you and Amen. Hope you will take this seriously and say yes.
P.S. I am actually the wife who manages and invests all of our finances all our married lives. Began investing when I received my first pay check. But we are all getting OLDER! I and many others would truly like to lighten our loads a bit and have AAII help us out a bit.

James from IL posted over 6 years ago:

Thanks for your thoughts. We have considered this before but there are problems with micro cap stocks in a mutual fund. When the market goes down significantly many investors sell. Forced selling in a mutual fund with micro caps that have a wide bid/ask spread when you should be buying can be deadly. The same is true with an ETF. The answer is to have a closed end fund but they are so out of favor it would be difficult to raise emough capital to make it practical. There are some unusual format funds but we just have not found a solution as yet. A hedge fund with lower fees and limited withdrawals might work. We will keep thinking about it. James Cloonan

Ted from CA posted over 6 years ago:

Closed end funds seem to have little following and likely to be rewarding if one knows all the major issues. Why are they not more popular?

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