To Family, Friends and Former Associates
OK, so the two May 2010 / May 2011 portfolios cashed out with a profit of $ 116,000 on an investment for the year of $ 1 milion. Lets assume every last penny of the $116,00 was spent. So now we are back at square one with $1,000,000 to invest and a plan to formulate aimed at next year’s May conclusion.
Since I am such a firm beliver in the ” Play till May ” adage, I break the year into two parts, May to November and November to May with no specific entry or exit dates. These are just guidelines to be very aware of.
The overall goal for this year is to make good on the historical stock market average return of 10% and cover inflation at 3%…Total $130,000.
Part one of the journey lasts 5 1/2 months, till November. If I can make $75,000 on this May Go Away portfolio by November, it will be very possible for the November to May leg to reach or surpass the overall $130,000 goal.
Of course, ANY effort I expend to reach $130,000 is better than simply letting the $1 million rot in a money market or brokerage account and settle for $15,000 while the depository banks / brokerages then use my money to shoot for the widest possible profit spread.
For me, May / November is the financial equivalent of the hurricaine season. I like to stay close to shore and leave the thrill of a Grand Banks adventure to others.
As we venture forth we do so with a smaller portfolio.This portfolio has 10 positions. but one position JNK has twice the amount of each of the other positions.
While the great inflation versus deflation debate continues, my belief is we won’t have a full measure of either but that ongoing anxiety about housing, jobs and the consumer will limit market gains and cause some roller coaster angst.
So, this portfolio is designed to receive ETF dividends and ETN interest as a safety net. As a whole,It should yield about 4% per annum. It allows me to own oil / gas toll roads ( pipelines ), extend credit to soverign nations in southeast asia and rent campus housing to students. It allows me to partner up with Jim Rogers via an ETN to invest in a wide range of commodities. and to invest in USA focused oil and gas exploration companies, participate at the dividend end of the Dow 30 as well as having total stock market exposure.
Though there may be a tweak along the way I feel pretty confident about getting close to the $75,000 – 5 1/2 month objective especially if the market stays within a reasonable sideways range. Plan B is Go to Cash ( or closer to cash )because I don’t intend to sit back and watch losses mount if I’m wrong.
Use the closing prices Friday , May 27 for this portfolio.
As always, I invite discussion so please feel free to contact me for more details via e-mail.
Richard, Rich, Richie, Dick, Smiley.. dba RMG