Recap for the year. Towards the beginning of the year we strongly favored India and Turkey and leading markets. Turkey was slow to get off but exploded during the summer and September. From there it fell hard but still up considerably. We missed the top but declined our exposure to Turkey before it fell further. The BFIA long only portfolio earned a return of 21% over the year which includes dividends. We also created a long-short portfolio in November of this year. We shorted in November and closed our shorts in November to take advantage of December. We were up 1.5% in November compared to down 2% in most markets. We held in cash during the first week in December and missed those returns but was able to still long from then to earn a nice December return.
Going into the new year there are select markets that we like as well as asset classes.
1. Mexico (EWW)
2. Malaysia (EWM)
3. South Africa (EZA)
4. Korea (EWY)
5. Chile (ECH)
The asset classes we like are:
1. Gold (GLD)
2. Silver (SLV)
3. REITs (REM)
4. US high yield corporate bonds. (HYG)
Our allocation is high for the above ETFs and more modest for the asset classes as we favor the select equity markets above over the asset classes.
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