The Faber timing model, by my calculations, has had no changes since August. U.S. Treasuries, as measured by the Ryan 10-year Treasury Index, came within 0.1% of a buy signal last Friday, but didn't quite make it. So we are still not in bonds. I know it's a bad idea to deviate from your system, but even if a buy signal had occurred this month, I would have stayed out. Looking 10 years ahead, there is no way a dollar will still be worth a dollar. Everyone buying long-term bonds today thinks they will be able to sell ahead of the crowd when the time comes. If the decline is gradual, they will be right. If not, not.
Mr. Faber in his paper uses bond data from Global Financial Data, but if that source is available free on the web, I haven't found it. The Ryan indexes are available both in the Wall Street Journal and on the Ryan web site (you will need to create a free login).
The last change in allocation was in August, after commodities (GSCI) and REITs (NAREIT [pdf]) crossed above their 10-month moving averages.
Here are November's allocations:
- U.S. stocks: 20%
- International stocks (EAFE): 20%
- Commodities: 20%
- REITs: 20%
- Cash: 20%
No comments:
Post a Comment