I am frequently asked to propose a long term portfolio that investors can just buy and forget about. They have no interest in sitting on the edge of their seat waiting for my next trade alert, staying up all night to catch the European opening, or scanning every wire service headline to glean a momentary trading edge.
I have put together a model portfolio that achieves exactly that. It focuses on the major trends sweeping the global economy that should run for a few decades or more. Regular readers of this letter are already well aware of these themes, and probably mumble them in their sleep.
Rising standards of living in emerging markets are certain to lead to major shortages in every type of commodity. These include food, precious metals, base metals, and all forms of energy. There is no way to avoid this shortfall, as the population is growing faster than our ability to bring on new sources of supply, which often take five years or more.
I have a big slug of exposure to specific emerging markets where GDP growth rates are triple or more than America’s own pathetic 2% rate. There is also a heavy weighting in America’s premier technology companies. Since the industry is literally on my front door step, it is clear to me that technological innovation is accelerating and will have a leveraged effect on our future, and that the US has an overwhelming lead. If you don’t believe me, then just try to hire an engineer in Silicon Valley, or find a reasonable rental in Palo Alto or Mountain View.
This would be the ideal portfolio for those who intend to lock it up for a long time. It would be a great use of funds that will not be needed for college educations that are 18 years into the future, or a retirement that is 40 years out on the horizon. It has an aggressive growth element to it, so it is ideal for the younger investing class.
I am not by any means suggesting that you run out and buy this portfolio today. Wait for a substantial sell off in the markets before sticking in your toe. One of the reasons that I keep high cash positions is so that I can buy names like these on the big dips. October 4, 2011 would have been a great day to load the boat, but only if you went into that day with cash coming out of your ears.
The portfolio is only available to paid up members of Global Trading Dispatch or my daily premium newsletter. To download the excel spreadsheet with the names, ticker symbols and asset class weighting, please click here, and enter your user ID and password.
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No, I’m Not Telling You What’s in the Portfolio