Ask Rande

Top 1799. Aug 15, 1999 4:45 PM

» RandeS - Tony,

Tony,

Lots of stock and mutual fund screening software out there. Morningstar, Value Line, etc. have online and commercially available software. Schwab has screening tools online, as do a number of other providers. As for software that analyzes the market as a whole, I'm not aware of anything off the shelf. People such as Brinker, Garzarelli, Zweig, and the major investment houses, etc. all have their own computer models for tracking the market as a whole, of course.

-- posted by RandeS

Top 1800. Aug 15, 1999 4:48 PM

» RandeS - Tony,

Tony,

Nice to know about AOL. All we need now is a "keyword." Of course, I don't know how we'd handle even a small percentage of those 18 million AOLites, but it would be a fun problem to figure out.

-- posted by RandeS

Top 1801. Aug 15, 1999 5:34 PM

» TONYBRIG - Keyword the target then!

Rande:
Keyword the target then!

Lets set that as one of our Goals then.
anyone have thoughts on this?

vbolhh

-- posted by TONYBRIG

Top 1802. Aug 16, 1999 6:46 AM

» RandeS - This just in from the Garz (at CBSMarketwatch.

This just in from the Garz (at CBSMarketwatch.com). Has she been reading the posts here lately?

Her Word is Her Bond

-- posted by RandeS

Top 1803. Aug 16, 1999 6:51 AM

» KirkL - Bonds

Good article about Elaine. She and Lou of WSW have liked bonds at 6% for some time I believe, but your "BUY at 6.25%" advance call and subsequent action might be the winning bond call if we are right about rates going under 5% long term.

Interesting in that I tried to listen carefully to Bob Brinker this weekend and Gene even called him this weekend to talk about bonds. (Maybe Gene can summarize his discussion with BB in the summary thread?) I might have misunderstood, but Brinker still says to stay intermediate and favors GNMA's.

I wonder, if GNMA's were BUYS and not even DCA at 5%, why is not a zero a BUY 8 months later when rates hit 6.25% and the interest rate expectation window is not 1.25% higher? Hedging? Very odd from a "Market Timer".

Me... Turned out switching from one fund to BTTRX couldn't be done in a day in my IRA and I had no cash available in the IRA... I wanted to switch SOME from GNMA and Intermediate Term Bonds to BTTRX. Turns out you have to go to cash first then make the buy the next day! I did make two big buys with cash in regular money into GNMA's at 6.25% in the long bond so I did get some bonds on that day they POSSIBLY peaked.

Good move on your part!

-- posted by KirkL

Top 1804. Aug 16, 1999 7:09 AM

» RandeS - Kirk,

Kirk,

I'm somewhat surprised at the positive action in the bond market this morning. Day's not over, but expected some backing and positioning ahead of the CPI. I'm in agreement with Bob's longstanding recommendation on GNMAs as a core fixed-income holding for all situations. Over time, rates rise and fall and though the NAV fluctuates, the corresponding yield and (if you're reinvesting) cheaper shares at lower prices make up for it given the duration, credit quality and excellent coupon at the Vanguard fund. What I don't understand is why there hasn't been more said about the potential buying opportunity from a tactical timing standpoint. With rates at the high end of his range and sentiment as bad as it gets in the credit markets (a contrarian positive, no?), I would think zeros in the IRAs would have been a good call. Especially since it's the only "fat pitch" around right now. Perhaps it has to do with the audience and focus. GNMAs are a good recommendation for long-term asset allocation and BB has said they're an excellent buy right now, which is true. Still, market timing is market timing and if it's okay for stocks, should apply to bonds as well.

-- posted by RandeS

Top 1805. Aug 16, 1999 7:27 AM

» RandeS - Should add -- could be that BB expects rates to stay high or go

Should add -- could be that BB expects rates to stay high or go higher, in which case he would adjust his range. That goes against his current range and comments regarding GNMAs being a buy, but might explain why is so cautious on the outlook for stocks. Since earnings appear to be in a strong trend, the other major stumbling block for stocks would be higher inflation followed by higher rates. To issue a buy recommendation on zeros in the IRA would be tantamount to saying lower rates are ahead which would imply no imminent fear of a bear market selloff. Is a puzzlement.

-- posted by RandeS

Top 1806. Aug 16, 1999 11:20 AM

» Phyllis - bonds

Rande:

I know you like Benham 2025. Does the Vanguard group have something that equates to their 2025? Thanks,

Phyl

-- posted by Phyllis

Top 1807. Aug 16, 1999 11:40 AM

» RandeS - Phyllis,

Phyllis,

Nothing at Vanguard that's comparable to the zero-coupon treasury funds at AmCent. Vanguard has a long-term US fund. Recently, the duration was about 10.6 years, which is well less than half that of the 2025 fund (26-year duration). I'm not aware of any other no-load, low-cost funds that come very close to the AmCent fund. There is always the option of buying the strips direct from a place like Schwab. Depending on your holding period, the pricing isn't that bad when you conisder no ongoing management expenses. Again, I'm viewing this as a relatively short-term play that would be attracive on purchase with yields in the 6.25% or better range. For every 1% change in yield you should expect a corresponding 1% gain or loss for every year of maturity. That would translate into a 25-30% gain if long yields get down in the 5-5.25% range over the next 6-12 months. Certainly no guarantee they will and they could even go up. Still, at these yields worse things could happen than to have these bonds in the IRA for a little longer than anticipated.

P.S. Still prefer the high-quality, intermediate range for the core fixed-income portion of a strategic asset allocation plan. The zeros are a tactical move based on relative attractiveness at this time.

-- posted by RandeS