Break down your portfolio in this thread.

[oldhat]

How do you have your portfolio spread? Have you moved any money around recently or are thinking about it?

[justa]

1. thinking about it but don't know where to go.

Would like to protect myself from the falling dollar and the coming crisis i see because of the government spending habits. I just haven't figured out where to go.

[illflem]

2. Play with this

http://www.fxcm.com/?engine=adwords&keyword=euro+content+2

Or buy stock in foreign owned companies. Some mutual funds offer portfolios that are foreign country or continent specific.

[Nite Owl]

3. Check out

www.everbank.com You can get cd's in almost any denomination. As the dollar falls you not only get the higher interest rate but a cap gain also. They are FDIC insured. Is ther risk, yes, but there seems to be greater risk in staying with the dollar right now.

[FloridaPat]

4. Just opened an euro cd at everbank. Also an account at

Goldmoney.com. There are several sites out there that you can buy gold but not possess it and exchange it for whatever currency you want at any time. I haven't heard too m uch about these kind of places. They seem like a good idea. Insured by Lloyds of London. God is kept outside the country. Heard Bushco wanted a list of people who owned gold several months ago.

I am almost in a panic. A despression is not too far off as a possibility. Or super inflation like Germany had before WW2. These idiots in the White House have really got things screwed up. I am buying a lot of this stuff through my corporation, so if the corporation moves offshore I don't have to worry about taxes. Now here's a real kicker - if your smart enough to take your future worthless dollars and trade them for gold or euros or whatever, and the dollar drops like a rock - when you turn them back into dollars you owe capital gains tax on anything you get more than what you bought!

[Terry in Austin]

5. Getting conservative

I recently got with my advisor (American Express Financial) and shifted around the nest egg to dig in for lean times.

(Disclaimer: I'm not qualified to give financial advice, but I can advise you to talk to someone who is)

So FWIW (see disclaimer): generally, when stocks are getting bearish, investors tend to go for bonds. In many ways, bonds are "safer."

Unless you want to play portfolio manager every day, buying into funds is generally better than owning the bonds or stocks directly. Same for currencies. As the saying goes: "Every day, if you haven't sold it, you've bought it." Best to leave this part to the pros.

I put the larger part of my holdings into foreign bond funds, most of which are denominated in Euros.

I also followed the classic "pyramid" strategy: the broad base goes into conservative funds, the small tip goes into aggressive funds, and the middle goes into moderate funds. I used 1/6, 2/6 and 3/6 for tip, middle, and base proportions.

FWIW, YMMV, IANAFA, SOE, see disclaimer.

[girl gone mad]

7. You should look into TIPS.

TIPS are bonds that offer some protection against inflation. A few months ago, I noticed that several large investors were buying. There is a good chance that the declining dollar will lead to inflation (stagflation).

IANAFA, either, but I think it's worth the time to read up on, particularly if you are close to retirement.

[elsiesummers]

11. Be careful of bond funds in a rising interest rate environment

just my opinion - not an expert - but be wary.

Theoretically the time to purchase bonds is not when rates are historically low but appear about to tighten.

Bond funds are not that safe.

I pared down even my tips fund holdings (although they are theoretically safer on price than treasuries) for this reason.

If you own bonds outright and hold them to maturity you eliminate risk of capital loss.

On the other hand, even though the fed (and world central banks, for the most part) appear to be in a tightening cycle, a recession could cause the Fed or other central banks to loosten rates again, thus supporting bond prices.

And then I'd be wrong. If I knew exactly what would happen with interest rates, I'd be a millionaire!

[Mike03]

6. Allocations

I'm not qualified to give investment advice, but this is sort of what I'm doing right now.

These percentages are approximate, and in some cases I am in the process of moving funds so these percentages represent goals rather than realities. Currently, I'm carrying an awful lot of cash, which I have mixed feelings about. I rarely select individual stocks but stick mostly to funds, with the exeption of mining stocks, which I like to pick individually.

15% - Foreign currency/Dollar weakness and Gold (I'd rather be at 25%)
10% - Energy related stocks and funds
7% - Domestic equity funds/general (want to gradually move out of these)
5% - Healthcare and pharmaceutical related funds
15% - Bond funds, especially inflation protected
5% - Global resource (want to go higher here)
10% - Long term yields/preferreds and REITS

As you can see, I'm carrying a hell of a lot of cash right now, which probably ought to be converted into Euros or gold.

I'm unusually bearish and have been giving a lot of thought to slowly moving out of U.S. equities except for energy, hard assets, natural resources and pharmaceuticals. A lot of people will tell you that's a mistake, which is probably why I'm hesitating. I want to increase my exposure to Asian and Eastern European markets. The Germand Bund is supposedly a safe place to park money unless China unpegs the Yuan from the Dollar.

Thanks for bringing this question up--I'm interested to see how others are navigating these choppy waters.

[idealista]

8. energy funds inflated? foreign interest rates and inflation?

I'm trying to reorganize my savings and SEP-IRA funds, and my parents', and am going heavily into international stock and bond bond mutual funds. A few questions in my mind, and maybe someone here has some insight?

-energy funds are way up for the year; oil is expensive. Does that mean the oil might fall again soon, and therefore these funds may be at a peak - it would be better to wait to buy?

-I'm putting some money in EverBank foreign currency CD's. They pay some interest (4% or so) but of course whether that is at all helpful depends on whether that country is experiencing inflation, right? Its alot to know before you invest, I'm just leaping, assuming others are doing it so it must make sense. HA!

-Alot of the international funds are heavily based in consumer goods, asian electronics, etc., and "financial" sector. If there is a worldwide, or even just U.S., depression demand for such goods will decrease, so I am leary of the burgeoning eastern economies. But maybe its more just the U.S that will suffer, and markets elsewhere will be robust.

About the financial services, I'm not quite sure what that means. If we get inflation here, what about the rest of the world? If other countries experience interest rate increases, those foreign bonds may lose value.

Hmm. Anyone know something about my novice's question?

[Mike03]

9. I share your confusion

I don't have answers, just opinions and more questions. Frankly, the more I read about global economics the more nervous I am about making too many dramatic moves at this point--for the very reason you suggested that because of the complex cause-and-effect it's hard to figure out when you start talking about foreign bonds and equities what will go up when the U.S. goes down. Some economists forecast a global economic recession. Then I suppose the game is to lose as little money as possible. I recently read that Japanese banks, for example, have problems of their own, and an incredibly high percentage of non-performing loans.

Just some random thoughts on your post.

Energy. It's true energy has had a nice run but I am holding onto energy anyway, because even though oil may pull back a bit I am in that camp that believes it will continue a steady rise. What I'm still trying to learn is which companies benefit from rising oil prices--because not all petroleum companies are in good shape. Some have downgraded their reserves, others are spending too much on exploration (or not enough) and not finding new reserves, etc...

International Funds. That's an excellent point about taking a very close look at their holdings. I try to look for international funds that are diversified and hopefully heavier in the direction of hard assets and resources.

I'm especially curious about emerging markets and how they will perform in the event of an economic storm. It seems to me that they are at risk too. On the other hand, if Europe and Asia divert their investments from the U.S. to emerging markets, maybe not.

So many questions and so little time.

[elsiesummers]

12. I also have similar questions (see#10)

I'm especially interested in energy, as well.

Like I mentioned above - I'd be careful of US bond mutual funds - unless you think a recession will cause interest rates to retreat. I don't think Greenspan warned traders idly that they had better be hedged because rates are going up.

Maybe it wasn't a warning: he could just be jawboning rates up and therefore treasury prices down. It seems rather inneffective of him to raise rates but find that treasuries respond by increasing price/decreasing interest.

Any time he gives a piece of advice (like when he told people to refinance with arms) it seems to be with alterior macroeconmic motives rather than the best interest of the advisee/individual (in the recent case bond traders) at heart.

[elsiesummers]

10. Here is a breakdown: Feedback appreciated.

43% Home equity (not a bubble number - real equity - but an illiquid coop - so higher risk and more difficult to sell)
29% Cash Equivalents
18% Currency CDs
6% Gold Stock Fund
2% TIPS Fund
2% China Fund



I'm considering adding 2% each from cash to two or more of the following Fidelity Sectors:

FSENX: Energy
FNARX: Nat Resources
FCYIX: Cyclical Industries
FSDAX: Defence and Aerospace

The first three are all run by the same fund manager.

Considered FSESX Energy Services but it doesn't seem to be performing up to the sector benchmark. Also considered FSNGX but apparently Natural Gas goes down in summer (although the fund is doing great) so hesitant.

Does anyone know how the PE's are in these sectors? (Don't want to buy if they are too run up). I've been trying to do research on this but not quite sure how to go about it - if anyone can direct me to a web page that might help - would appreciate it. Not having much luck googling or yahooing.

Suggestions and input are appreciated.

Also, have been reading many bears - does it seem unwise to not have any broad stock funds? Read an analysis recently (a Mauldin Outside the Box letter) that suggested overweight England and Gerany, underweight US and Japan. I see differing POV's on Japan - but most say that the USmarket is overvalued and Europe undervalued.

Then I think about the pressure a rising Euro will put on the European stock market, and I worry that it might be bad timing to get in now.

We are almost forty and it feels crazy not to be in stocks after being 100% in from 93 to 99 and then half way in until 2003 - but I read bears and do think Bush's big spending ways are bad economic news.

So much of this portfolio is fear based. Is this sane or no? I read many who say don't pay attention to market cheerleaders - but then between the cheerleaders and ever increasing tax breaks on investment, and things like private Soc Sec - it seems crazy not to be dollar cost averaging into US stocks, even in this nutty economic environment. Reagan ran up the deficit but the markets mostly went up so wonder if I'm over paranoid about the economic effects of Bush's antics. Granted, Reagan knew how to stick with managable warmongering rather than this Bush mess. But I digress. Have thought of following a market timing program - although the ones I see still seem to be overall heavily invested in broad market funds.

Suggestions and input are appreciated.