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The Muscular Portfolios Newsletter — No. 22 — Dec. 31, 2019
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ETFScreen gives away the signals
 By Brian Livingston
There’s a new way for you to find the top-ranked ETFs for your Muscular Portfolio each month. ETFScreen.com, in cooperation with Publica Press (the publisher of this newsletter), now posts the ranking tables on its website free of charge — offering you some new features.
Figure 1 shows one of ETFScreen’s tables, using as an example the very simple “starter portfolio” known as the Baby Bear.
Since November 2015, when the book Muscular Portfolios was barely in development, EFTScreen has provided our website with ranking tables for the three main strategies. (See Issue #3 and Issue #5 for more details on how the tables work, including their little orange calendar icon.)
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Figure 1. ETFScreen.com updates the rankings for the three portfolios every 10 minutes, just as with the tables at MuscularPortfolios.com. This gives you an alternative source for the numbers in case either website is down for any reason.
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My goal ever since the book was published in October 2018 has been to “institutionalize” these statistics. That doesn’t mean putting them in a mental institution. It means making the statistics available on a variety of different websites, so you can always find a site that’s up and running — every cloud server has occasional outages for an hour or two — and visit whichever one has the most useful features for you.
The ETFScreen tables have some capabilities that the ones at MuscularPortfolios.com do not. For one thing, try clicking an underlined ticker symbol, such as VTI in ETFScreen’s Baby Bear table. A new page allows you to see a graph of that ETF’s performance for the past three months, six months, or one year. The site offers many other statistics on ETFs of all kinds.
Don’t let the stats distract you!
Let’s say you see a six-month graph at ETFScreen, and you decide not to invest in one of the top-three ETFs because “the price is now too high” or whatever. If so, you’re falling victim to a behavioral bias (in this case, anchoring on an old number).
Second-guessing a computerized formula harms your long-term performance. This was dramatically shown in a real-money experiment by Joel Greenblatt that’s explained in Chapter 14 of Muscular Portfolios.
Let the computer rate the ETFs for you. Spend your time doing more valuable things.
The Muscular Portfolio stats are intended to be free of charge forever. The whole point of the book is to show you how to get great long-term gains without paying any advisers anything.
That doesn’t mean you shouldn’t avail yourself of good professional resources. Take the following steps to acquaint yourself with ETFScreen:
- Visit the ETFScreen pages for Muscular Portfolios, Mama Bear, Papa Bear, and Baby Bear.
- Register a free account at ETFScreen’s registration page. Your account allows you to save your own ETF portfolios, create screens using five years of data, schedule email alerts, and more.
- Consider upgrading to a Premium Access account. This gives you historical data back to 2001, customizable graphs, and personalized links to StockCharts.com, Morningstar.com, and other financial sites. At this writing, Premium Access costs $15.95 per month and can be canceled at any time. See ETFScreen’s advantages page.
Publica Press and its personnel (including yours truly) receive nothing if you register at ETFScreen or upgrade to its Premium Access. The Muscular Portfolios tables will always be a free service, and there is no financial incentive to me. I simply want as many websites as possible to carry these rankings for you to see.
Try an account at ETFScreen and see how you like it. Just don’t get hung up on trying to find some new “magic formula.” The simpler the rules, the better you’ll do as an investor. Complex formulas fail at the worst moments.
In the 15 years ending June 2019, 90% of actively managed US equity funds underperformed their benchmarks, as reported in a Nov. 18 Advisor Perspectives article. By contrast, ETF index funds are proven to give you 99% of the return of any market. Why subject yourself to the costs of active management?
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New way to access past issues
A collected list of all past newsletters is now at MuscularPortfolios.com/news (or simply visit the site and select "Past newsletters" in the menu).
The listing includes a short table of contents for each edition, so you can locate any particular issue you might want to go back to.
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Get the book that frees you from Wall Street
Muscular Portfolios has received rave reviews from experts of all kinds:
"I know of no book for a general investment audience that is more thoroughly researched and backed up by hard data." —MARK HULBERT, founder of the Hulbert Financial Digest
To order the book, visit Amazon, Barnes & Noble, or any bookseller.
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