The Sharpe Report: Issue No. 2 … Dan’s Portfolio

Posted on Jan 4 2015 - 2:02am by Sharpe Trade

Dan’s first Sharpe Report entry can be found here.

We are continuing the discussion from the last entry that can be found here.

So, I think at this point, it’s a good idea to review.  What I am doing here, is teaching what it is that I have learned.  And when you learn a new skill, it is vital that you take some time to review.

Just sit for a while, and think about what we have talked about, up to this point.  What you personally have learned up to this point.  Knowledge you have, that no one can take from you.

We have begun to discuss record-keeping.  Now myself personally, I use Quicken as a register, for this “Core and Satellite” method.  We know that “Core and Satellite” is a particular portfolio management system.  But there are others.  As we’ve pointed out, I manage a few portfolios, and another method I use is one called “risk parity“.  Regardless, we have also discussed that we can use cash due to what I feel is part of the larger economic picture.  But not only can we use cash because of the larger economic picture that I personally see.  But we can also use cash as not only the piece of a portfolio, but of a strategy itself. What strategy?  An “All-Weather” strategy, that can be viewed as a single position, made up of 4 different pieces.  Outside of that strategy entire strategy we are going to establish some longer term positions, and one of those will be an ETF exposed to Investment Quality Corporate Bonds.


Now, forget for a second that I use Quicken as a means of tracking two separate entities in the portfolio.

Forget for a second that I’m using “Core and Satellite” for this portfolio (just for a second).

Forget that I decided not to use SHY, an ETF exposed to 1-3 year bond, and why.

Forget that I’m looking at LQD for a position outside of the ‘all-weather’, for a longer term position.  Forget why I’m looking at it..

My point, is that if we stop thinking about the details, you’ve already learned about four very powerful concepts, and principles, that you can carry with you now.  These are principles that you can learn about for yourself.

Now, I want you to get a pen and paper, because I am going to ask you to write something down.

No, I’m not kidding.  I really want you to go get and paper with which to write something down.  


Do you have it?

Write down portfolio record-keeping on your piece of paper.

Write down portfolio management process on your piece of paper.

Write down cash in portfolio.

Write down all-weather strategies.

Ok.  Now some homework.  And no complaining.  You can’t learn something without a little homework.  And it’ll be easy.

Google each one of those four topics.

Research them out.  You might even enjoy it.  Take some notes.  

Learn about them.

I’m not here to be anyone’s guru.  I’m not here only to give you hot picks.  Yes, I will show you what I do, exactly when I do it.  And yes, I think I am a pretty good trader and you can watch what I do, when I do it.  But whenever this particular project comes to a close?  I would like you to know how to be your own trader.  You?  You should be your own guru.   You can be your own analyst.  My job is simple to show you the main principles that I have learned then provide some examples, in real-time, of how I apply them.

So now you have your homework assignment, let’s look to our portfolio, and talk a bit more about recordkeeping and another feature that I am going to share with everyone as a part of the Sharpe Report …

The link to the spreadsheet that will keep track of my section of the Sharpe Report can be found here.

Please note that in the future, from time to time we will move that spreadsheet to a completely new sheet so as to change the link.  So if you are viewing this article in the future from the time of this writing and the link does not work?  We’ve probably moved the spreadsheet, and a new link is available for subscribers.

During this next week, I also have some new positions to talk about, that I am looking at putting in the portfolio.  Both as a piece of the all-weather Core, and also longer term positions.  

This is the Raw Open Office Document File. 

This is the PDF for Issue Number 2 ….

(We continue the discussion in this next entry)

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