ITA Wealth Management

Much attention is given to market indicies as they are used to convey information as to how well a stock market is performing.  If someone says, the market is up or the market is down, they are generally referring to the Dow Jones Industrial Average (DJIA), an index that goes back to the late 1800s.

For our benchmark, we use the VTSMX index fund as it covers a wider range of investments than does the DJIA 30 stocks.  Rob Arnott writes in “The Fundamental Index” that “an index is a portfolio that is objective, formulaic, transparent, historically replicable, and has low turnover.”  The VTSMX meets the Arnott standard.

In addition to the VTSMX, the Mosaic spreadsheets also include the S&P 500 under the guise of VFINX.  You will also see something I call the “Blend Index,” an effort to see how closely the portfolio is tracking the ETFs and stocks that make up the portfolio.

Lowell Herr

Photograph:  U.S. time trials at Alpenrose - Portland, OR.

This information is available on the Premium Content side of this blog.  Cost is $6.99 per month.