Only a handful of geopolitical events have led to / accompanied major market corrections. One factor that has repeated over time has been the slowing of market activity / dry up of liquidity, the increase in market volatility because of exogenous events during the summer / fall months, and favorability of earnings reports, pick up of volume/liquidity and institutional allocations into equities in the fall / winter / spring months. If an investor utilizes an empirically derived, systematically based, risk managed process with a diversification over varied asset classes, then long term results and investment decisions are less affected by geopolitical events and emotionally driven financial news.
For example, investing in a blend of small cap value and emerging small cap from Nov 1 to Apr 30 and then switching to utilities sector or cash equivalents ( depending on "high risk" signaling instruction from risk profile variable * ) from May 1 to Oct 31 of each year, forward 5 year total returns periods after 10 major geopolitical events over the last 60 years have produced: > 100% in 7 periods and 50% - 100% in 2 periods with no losing periods.
A higher confidence of an investment process' returns involves a review of 5 year total returns after market peaks and then subsequent market corrections of > 5%.
Since 1954, forward 5 year total returns periods for the small cap value / emerging small / utilities / cash process after the "peaks" have produced > 100% in 11 of 24 occurrences, between 50% and 100% in 8 out of 24, with no losing periods with median 5 year return = 87% vs. 43% for S&P500 buy & hold. Median 5 year return periods outside of correction occurrences = 114%.
In summary, market corrections and geopolitical events are temporary. An investor who has utilized a robust tactical investment process combined with superior asset class selection, and has been disciplined and patient for at least 5 years has been well rewarded.
* quantitative price based variable # 2 https://docs.google.com/document/d/1u5PjMjpeLICy8fa-34c89oHqV6bghPTipGO_0IY3VRc/edit?usp=sharing

I'm now 34 years young and I can't remember when times were not interesting! : )

I fear we will not know the full impact of the Brexit decision for many years, and that this impact may be much more that stock market fluctuations.
Putin has been consolidating power recently, and a less united Europe plays into his hands. This is probably my biggest fear. I think the folks arguing to leave were sold a bill of goods, and are suffering near term buyers remorse. The larger impact may indeed be down the road with a destabilized Europe.

That is true. Look at the middle east. The world is reaping what was decided in WWI!
http://www.bbc.com/news/world-middle-east-25299553
But as I posted in another thread the EU was going against the historical trends. We can expect more countries to leave the EU in favor of localized government.
Longer term Europe will build stronger ties with Russia and it will not be a bad thing for them. And it will be going back to what it was historically - Russia, just another western European country. Russia is not the USSR, it is facing the same problems as the western European countries.

Only a handful of geopolitical events over the last 50 years have produced major forward negative returns.
If an investor utilizes an empirically derived, systematically based, risk managed process with a diversification over different asset classes, then long term results shouldn't be affected by news driven, geopolitical events.
For example, investing in a blend of small cap value and emerging small cap from Nov 1 to Apr 30 and then switching to utilities sector or cash equivalents ( depending on signaling instruction from risk profile variable * ) from May 1 to Oct 31 of each year, forward 5 year total returns periods after 10 major geopolitical events over the last 50 years have produced: > 100% in 7 periods and 50% - 100% in 2 periods with no losing periods.
A more compelling test of an investment process' returns involves a review of 5 year total returns after market peaks and then subsequent market corrections of > 5%. Since 1954, forward 5 year total returns periods for the small cap value / emerging small / utilities / cash process after the "peaks" have produced > 100% in 11 of 24 occurrences, between 50% and 100% 5 year total return periods in 8 out of 24, with no losing periods.
* quantitative price based variable # 2 https://stockmarketmap.wordpress.com/2015/11/14/market-map-model-tactical-asset-allocation-using-low-expense-index-etfs-2015/

I fear we will not know the full impact of the Brexit decision for many years, and that this impact may be much more that stock market fluctuations.
Putin has been consolidating power recently, and a less united Europe plays into his hands. This is probably my biggest fear. I think the folks arguing to leave were sold a bill of goods, and are suffering near term buyers remorse. The larger impact may indeed be down the road with a destabilized Europe.

Hi guys!
Thank you for your input. Will retire at 61. The company will pay me to leave. At 62, I will get pension and social security. All things paid: house, cars, college, etc. As far as an estate, what is left will go to an only child. We would like to leave him the house, for sure. After that, it's just gravy. As far as overseas, it is concentrated. Friday showed me that. I guess I should spread it out more.....maybe an index fund, but no more %-wise. Europe is a mess, and I don't see it getting better. I think soon it will be China again. I like home better.
As for right now, my 401k is with FIDO---also a brokerage account. The only fees I've paid were for Wellesley ($75.00). This portfolio is not all set up yet.....it's a build in progress.
As far as other houses, I really want to stay with FIDO. I like their website and understand it.
Risk tolerance is conservative. 3% would be fine. My wife works at the Post Office and will be working for about 4 years after I retire. She will get pension and SS, also, along with a 401k (Thrift Savings Plan - TSP).
So, all income I want to go to MM fund to be used to buy more shares or for spending as we see fit. This portfolio does not have to outlive me......a house is enough, I think, for now.
Also, I have WAVIX and PTIAX as two (2) that might go along also.
God bless
the Pudd

It's hard to make constructive suggestions without knowing more about your situation...
What percentage you plan to draw (and will SS kick in before or after you start, which could affect weightings), are you looking to leave an estate (which would argue for more equity, since that's invested for a longer lifetime), etc.?
So here are a few comments and observations on the edges:
- This is weighted about 50/50 - including 30% in equity funds, 40% in Wellesley (1/3 equity), 20% in Golden Rainbow (1/2 equity). Might be okay for a shorter time frame portfolio, but for 30+ years, a tad more equities might be in order, especially given the low yields in bonds now and likely for several years.
- It's somewhat light on foreign exposure (about 8% of portolio), though not exceedingly so (i.e. as a percentage of equity, it's about 1/6).
- The domestic funds are very diversified (except PRBLX), while the international holdings are highly concentrated (28 stocks in Lazard, 32 in FMI). Intentional or an artifact of the fund selection?
- Share classes. If you're buying through Fidelity (a reasonable guess, given two Fidelity funds), you might look at buying the TF institutional share classes. Especially for a retirement portfolio which you expect to be selling off (no fees). That saves you a lot in fees over the years.
Specifically: DBLTX ($5K min in an IRA), and if you've got over $250K in your portfolio (total), GLRIX ($50K min = 20% of $250K portfolio).
If you're not averse to having investments in multiple places, you could buy VWIAX directly from Vanguard ($50K min = 40% of a $125K portfolio). Scottrade appears to give you access (with $17 TF) to PIMIX with a $100 (not $100K) min.
Just some minor thoughts. All in all, a nice portfolio.

Hi @FundStudent,
Neither did Old_Skeet get sucked in either.
Being a retail investor, and not a trader, by my valuation matrix indicates stocks, in general, are still to expensive as of Friday market close for the S&P 500 Index (2037) for me to increase my allocation in equities. I am thinking we still have a ways to go before a bottom is reached. Currently, I am looking somewhere around 1950 on the 500 Index before I open shop, during the summer, and devote much time towards my investing endeavors. With this, I am not following the markets during the day but I still do a daily and weekly portfolio close. My overall asset allocation bubbles as follows: cash 25%, bonds 25%, stocks 45% and other 5% according to my latest Instant Xray analysis of 6/03/2016. Please note, this is an adpative allocation, of sorts, that allows for some asset movement (upward or downward) within the allocation, from time-to-time, based upon market climate and my read on the markets. Currently, my range for stocks is 45% to 55% and was up above 65% a few years ago; but, as P/E Ratios have climbed, over the past couple of years, I have reduced my allocation to them.
I wish all a good summer ... and, most of all, "Good Investing."
Old_Skeet

O, HCN, WPC and VTR make up my personal REIT collection, and I'm really happy with that team which makes up about 15% of my IRA.
By the way, I added WPC two and a half years ago on a recommendation from Scott who used to contribute here.
Thanks Scott.

Gundlach is the darling of the media. He seeks them out, seems perturbed when they are not drooling at his every word. By contrast, Hasenstab is only in recent years been in the media. He is much less comfortable doing these things than the other two. And all you have to do is listen to him, quickly recognizing he is pretty calm and in no way focused on himself.

PLANS IN THE PIPELINE
In a hastily arranged call with investors and Wall Street analysts early on Wednesday, where Tesla executives defended the deal, Musk said institutional shareholders had some idea of the plan.
He had not disclosed the deal, he said, but over the years, "this idea has been bandied about with some of our largest shareholders, institutional shareholders. Yeah, there have been discussions."
The manager of the second largest mutual fund investor in Tesla, the $12 billion Fidelity OTC Portfolio, which is also the largest institutional holder of SolarCity, praised a tie-up in comments earlier this year.
“We remain fans not just of Tesla products, but of the concepts and potential future partnerships behind the company. We foresee fruitful synergies between say, Tesla and SolarCity – or any company that can benefit from superior battery technology,” Gavin Baker, who runs the Fidelity OTC fund FOCPX , said in his first-quarter commentary for investors. It owns 2.1 percent of shares.
Baker and Will Danoff, who runs the $100 billion-plus Fidelity Contrafund FCNTX, the largest mutual fund investor in Tesla with 3.5 percent of stock, have both told Reuters in interviews that they tend to give more leeway to founder-run companies which they believe are still in the early stages of growth.
Musk, a founder of Tesla and SolarCity who owns about a fifth of each, will recuse himself from board and shareholder votes, leaving the fate of the deal in the hands of outside investors, led by major fund companies such as Fidelity Investments.
https://www.yahoo.com/news/behind-tesla-carnage-signs-support-musks-solarcity-deal-005255105--sector.html?ref=gs
FOPCX
$ 77.31
1-Day Total Return
-0.83 % as of 22 Jun 2016 |
FCNTX
$ 96.89
1-Day Total Return
-0.34 % as of 22 Jun 2016 |
OTCRX SCHEDULE OF SECURITIES SOLD SHORT
AT JANUARY 31, 2016 (Unaudited)
Automobile Manufacturers: 0.9%
11,028 shares
Tesla Motors, Inc
https://www.sec.gov/Archives/edgar/data/811030/000089418916008671/ottercreek-pmp_nq.htm
OTCRX
$ 12.01
1-Day Total Return
+0.25 % as of 22 Jun 2016 |

Is it just me, or has FrankTemp been letting MH out into the media more and more in recent weeks? You never hear from him, and now it seems I come across his name every few days. Could it be anything to do with the ongoing years-old decline in AUM for TPINX/TGBAX?
(I am down to a tiny position myself, having sold out of much of my position recently)

Saying all of these have been disasters is simply wrong. The biggest problems have come with liquid alts that allow the managers to essentially go anywhere, do anything. From our experience, those equity long-short funds that make large macro bets have been the worst. They are either doing extremely well or they are sucking air, mostly the latter of recent.
Other liquid alts have done about as we might have expected them to do. As with all fund categories, some are much better at executing their strategy than others. We have learned that it is very important for investors to know what the fund's strategy is, in what circumstances they ought to do well and where they might struggle, what limitations they have in terms of how they run the strategy, and how the strategy fits in with the investor's portfolio.
The numbers in the article are averages for each category, so the premise is unfair from the beginning. We could use the same thing for pretty much any asset class and run an article saying "(fill in the blank) investments have been a disaster." There are some Market Neutral, some Option Writing, some Multi-Alternative, some managed futures, some hedged equity, some precious metals, some commodities funds that have done pretty much what we would have expected. Most have not, but is that not the case for all fund categories? But then, MarketWatch has become more sensationalized in its headlines in recent years, and most of its writers tend to be that way, too.

Among several other threads from M*Premium folks reporting both major and minor problems with the 'premium' site we pay money to use. For YEARS.
It's beyond pathetic at this point, and I'm making the call tomorrow to nix my auto-renewal of the Premium site access, because after 3 years of problems, it's clear that not only isn't 'premium' premium, but the emphasis for whatever IT folks work there is on their institutional side products, and the retail folks are left hanging in the breeze.

Quote from Morningstar discussion board.
---Portfolio Manager has not been been updating daily fund prices in a timely manner for years.
--Take a look at the "How tiresome ... portfolio again not updated" thread which was started over three years ago and now has over 790 posts from M*'s frustrated customers.

Perhaps if more trades get routed through IEX that will leave the high frequency gang to trade among themselves (spoof each other). It will be interesting to see what kind of volume this new exchange generates. I am thinking that it will grow volume over time; and, I am also hoping this starts the demise of the flash crowd which I believe from what I have read have been scalping the markets now for too many years. Indeed, it is time for this front running high frequency electronic trade activity to stop.

Hi Guys,
The referenced article that presents the shortfalls of investor returns relative to market rewards in the 1950s doesn't adequately document this highly persistent pattern. The individual investor shortfall is a reality across all decades. It is surely not restricted to that decade alone.
DALBAR has reported this wealth limiting private investor handicap for many years now. In any given year, individual investors recover only 30% to 50% of equity market returns. We historically do not score well, and very often don't recognize our poor performance.
I suppose we are frequently overconfident of our capabilities in this challenging arena. Even most fund managers underperform. Our hubris limits our ability to properly score ourselves. We don't beat the odds.
Study after study demonstrates that as investors we suck wind big time. I mostly gave up this losing fight a number of years ago. I spend far less time worrying the marketplace and specific investment decisions these days. I'm heavily into Index products. Life is much easier now!
EDIT: It would likely be a good practice to check our Egos before making an investment decision. That's easy to say but is a high hurdle for many of us. Fortunately I was never the smartest person in any and all rooms.
Best Wishes.

Hi @johnN,
I enjoy reading Dr. Madell's monthly newsletter and this month was no exception.
This month I averaged all the model portfolio's recommened asset allocations for cash, bonds and stocks. With this, for his three models, stocks averaged 45%, bonds 40% and cash 15%. Not sure if this has any great meaning but it is something I have been doing for the past couple of years in an attempt to follow the true shift in his asset weightings between stocks, bonds and cash.
When I detect a shift in his averages I then check my allocation to see where I stand in relation to his averages. Currently, we are the same for stocks at 45%, he is heavier in bonds at 40% and I am at 25%; and, I am also heavier in cash than he is. But wait, his model allocations are for the buy and hold investor and my weighting allows for some near term movement by using an adpative allocation model and strategy. In general, when stocks are expensive I hold less of them and when they are cheap I hold more of them thus rebalancing my equity allocation downward as stocks, in general, become more and more expensive.
My allocation model and investment sleeve system also allows for a seasonal strategy and its positioning along with taking advantage of market pullbacks and the associated swing. However, since bonds are not currently providing much yield and might soon face a rising interest rate environment I have chossen to carry a heavier cash allocation than normal this year thus foregoing my usual shift into bond funds from equity funds throuh nav exchanges. Since, I parked the cash proceeds from the sale of equity funds in the respective fund family's money market fund I can buy their funds again at nav without paying another commission or transaction fee. In addition, I pay no wrap fee on my accounts. With this, what some state and consider to be a high cost due to the frontend sales load, on the first purchase, actually turns out to be a low cost way to invest for an active investor, like myself, that likes to reconfigure their portfolio from time-to-time due to market movement and seasonal trends.
And, so it goes.

I have used this strategy for a good number of years with good success and it is a strategy I learned from my late father many years ago. I guess all strategies have their critics by those that fail to scout the route and fully understand them. For me, I reduce my equity allocation during the summer months (usually around May) and then increase it come fall (usually during late October early November) and sometimes during the summer should there be a good pullback.
In fact, I have found, the summer months are a good time to put new portfolio money to work in bond funds for those investors like myself that have, at times, paid a commission on their purchases because fixed income funds can usually be purchased at a lesser commission rate than their equity counter part and they also usually have the better returns during the summer months over stock funds. Come fall, when stocks usually begin to rally, one can then do a net asset value exchange from the bond fund into an equity fund within the same fund family usually with no commission or fee associated with the exchange. In addition, I pay no wrap fee on these accounts.
I guess we now know why the writer of this article fell into the grease continers after climbing the fence in taking his short cut route to McDonalds. He simply failed to scout know and heed to the perils that were associated with his short cut route.

A Little History
...a moment in time at the end of the summer of 2011 during which the investor class had temporarily lost its collective mind.
Investors, you see, had pushed the assets under management in State Street’s GLD Etf to a higher level than the assets held in its S&P 500 Etf (SPY). In other words – investors had decided, in the aggregate, that securitized rocks were worth more than the entirety of American capitalism and free enterprise.
The combined productive fruits of American business and labor were, for a moment, worth less to investors than a paper precious metal proxy.
August 22nd 2011

http://thereformedbroker.com/2014/09/18/that-time-three-years-ago-when-investors-temporarily-lost-their-minds/
Today

SPY
As of 06/16/2016
Price $208.38
Shares Outstanding 876.68 M
Total Net Assets $182,685.64 M
GLD Last Sale
US $123.97
Gold spot price
Bid
US $1,298.45
Ask
US $1,298.85
Total gold in trust
Tonnes
907.88
Ounces
29,189,217.78
Value US$
37,667,845,243.64
I recently trimmed my precious metal holdings @ a ( long waited ) profit. Now < 5% of investable assets, mostly TGLDX and PSAU