Odds N Ends

First, I found a new website, Closed End Mutual Fund Orphans. The site is devoted to creating better a understanding of how CEFs work and helps to isolate CEFs worth considering. Also the resources page has a few links I did not know about.

I write all the time about using whatever tool is the best thing to capture a certain effect. For me this includes CEFs. Hopefully the Orphans site will continue to evolve to offer more things to more people, for now it is off to a good start.

ETFInvestor has a short commentary about investing in Turkey. I had a lucky trade on Turkey with the Turkish Investment Fund last winter. I should have gone back in but have not. Turkey has a shot at EU inclusion. If it does not get it it will likely be because the country is too big, 70 million, and the work force is too young. The theme makes a lot of sense to me and is worth learning if you do not already know it.

There was also an article on ETFinvestor about Japan. A lot of folks are bullish on Japan so of course if you want to own the country you buy EWJ. Not so fast my friend. There is another ETF for Japan, the iShares S&P TOPIX 150 Index (ITF). Actually the returns have been identical to EWJ. The composition is different, EWJ has about 280 holdings and the TOPIX ETF naturally has 151 (ahem) holdings. The differences haven't mattered yet and I don't know if they will matter later but there is a choice, albeit a lower volume choice.

I had a comment left by someone about bonds with a website he wanted to mention who believes in bond exposure because it allows him to sleep well at night. First, if you want to mention your site with a link, write the code in the body of the comment, it will be easier for other people. The sleep factor he refers to is crucial, no question. I think this comment was in response to my remark about another reader perhaps being too cautious with a 60% weight to bonds.

There are two different things at work here, sleep factor and the numbers. No question that some fixed income exposure is appropriate for just about everyone. It does reduce volatility. I think there is an argument, based solely on the numbers, for 100% equities at the target allocation. This would obviously ignore the sleep factor entirely but the numbers are worth considering as you try to figure what the right mix of stocks and bonds is for you.

Before I get piled on for that one, I am not saying the people should invest 100% equities, I am saying there is a statistical argument for it that should be understood.

Another reader asked what I thought about PIMCO Developing Local Markets Fund (PLMIX). The fund owns emerging market debt and currencies. It sounds interesting but neither Yahoo Finance nor Morningstar had any detailed info on the fund. I'll try to dig some up at the PIMCO site later. If I have any luck I'll put up a post.