Cruising Toward the New Year

The holidays are now behind us and we can turn our attention once again to looking to the new year.

It is our plan to construct a new Model Portfolio as we do each year at this time–but we will NOT liquidate our 2014 portfolio.  It was a mistake last year to liquidate the 2013 Model as these are learning tools as much as anything and liquidating does not allow us to continue to learn from a particular portfolio composition.  We will launch our new model on 1/2/2015.

Last year as we looked ahead to 2014 we thought that we would have seen somewhat higher interest rates by now–but we have not and this has been a ‘gift’ to income investors–it has allowed one to garner continued high yields from perpetual preferreds without taking the heavy knock that is eventually coming.  It has allowed us to make a pretty big shift into shorter durations in a leisurely fashion instead of helter skelter trying to move money to a safer haven.

So in the meantime, over the course of the next week, we will finish up our model for 2015–which will not be an easy task, but one can assume that it will be dominated by shorter duration instruments with a good dose of REITs.