ITA Wealth Management

New visitors to ITA Wealth Management who know nothing about MEDA Trust can learn more by going to their web site or by searching for “MEDA Trust” on this blog.  Although there are similar organizations, my wife and I chose to become involved in MEDA Trust as we personally know several officers of the organization.

It has been many weeks since I last gave an update on our involvement so here is a brief summary.

1.  We are currently involved in 147 businesses in Afghanistan or Nicaragua, the two countries where MEDA Trust is active.  Note that we are partial contributors to many of the 147 businesses.

2.  Of monies loan to small businesses, 236% has been repaid.  The reason this figure is over 100% is that money paid back is then loaned to another business.  It is not long before money contributed to a small business is repaid and put back to use in a second, third, and fourth business.

3.  Of monies load out, 338% of the original contributions and matched money is currently out on loan.  Again, the percentage exceeds 100% as the original money is currently working many times over.  And we have only been involved with MEDA Trust for approximately two and one-half years.

Readers interested in participating in this push back against poverty can get involved in the Afghanistan program using matching money from the Canadian government.  I don’t know how long the matching funds will last, but about a week ago, for every dollar contributed to the Afghanistan program, the Canadian government matched another dollar.

Small dollar amounts are accepted as it is possible to be a partial participant in a business.  For example, if you contribute $25 and the Canadian government matches it with another $25, you can contribute $50 toward a business that may require $300 to get started.  Other donors will chip in another $250 and the business is launched.  You are now a 16.7% holder in the business and when the loan is paid back, you will receive your $50 which is then available to re-loan to a second business.  And on it goes.

I highly encourage investors who visit this blog to give serious consideration toward making life better for those who have much less than we do.  Small monthly contributions to MEDA Trust will make a huge difference over the long run.  This small step by step process is very similar to what it takes to patiently build a retirement portfolio.

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Photograph:  Street performer -  Seattle

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Are we in for a market correction?  Is the market overvalued and due for a modest decline?  In my opinion, the answer is yes.  Here are some of my reasons.

1.  I have a “Watch List” from which I extract the “Creme List.”  This list of “best” stocks is published weekly over on the Premium Content side of ITA Wealth Management.  Within this spreadsheet of stock I track the price behavior using PnF charts.  Below is an example of the MMM chart from StockCharts.  Note the X’s in the far right-hand column and the blue line with a positive slope.  When both metric are as shown in this graph, I code it a “Bull” setting or the most positive of four PnF chart options.  Right now, 65% of the stocks I track are showing this same “Bull” setting and over 88% of all stocks display the positive blue line.  This is an unusual situation and it leads me to conclude the market is overvalued.

2.  The second reason to conclude the market is overvalue comes from another technical indicator.  I selected VTI, a broad market ETF, to demonstrate my point.  Examine the Relative Strength Indicator (RSI) and you will see it is currently above the 70% line.  When this occurs, the particular investment, the broad market ETF in this case, has a very high probability of pulling back.

I suggest investors go to this link and enter the tickers for their own investments.  See how many of your holdings are showing RSI values close to or above the 70% line.  If nothing else, it is a time to be cautious.  

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