Tuesday, October 18, 2011


After visiting with my cousin in San Diego, who is a V.P. of Asset Management for JP Morgan, (and an unsuccessful try with Schwab's Laudus Funds), to set up a fund to manage based on DITM, I still haven't come up with anything solid. Based on 2 1/2 years testing, I still feel it is the best strategy for the current and near-future market environment.
My small IRA (which is the purest test tube for DITM) just hit a 3-year high, after all the turmoil in the markets since 2008. Although the S&P 500 has run 30% from when I started the DITM in May '09, my IRA has run 21%; however, based on the safety net provided by the lower call, since the April 2010 high, the SPX has just regained positive territory, up 1.5% for that span as of today, while my IRA is up 12.7% -as I said, to a new high since 2008.
I did pick up the 3rd Quarter report from JP Morgan, a great wrapup of information. For example, retiring Boomers (the largest population group to date)who spent the past 20 years (after raising families, etc.) saving for retirement, received the following annualized returns from 1991:
REITs - 10.5%
S&P500 - 7.7%
Gold - 7.2%
Bonds - 6.1%
Homes - 2.8%
Average Investor - 2.6%
Inflation - 2.4%
Although I've experienced a 10-13% consistent annualized DITM return, a realistic return (dead money, slippage, etc.)would be 6-10%. This is why I want to start a fund - to actually quantify the return.
Since returning I did a Buy/Write on COP, and the TLT -Dec.106 call still looks great.

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