WisdomTree 90/60 U.S. Balanced Fund [NTSX]

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lexor
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

NTSX killing it today. Saving about 2.5% in losses over 100% stock last I checked. Glad I moved instead of waiting.

I really like the concept of this fund. Reduce volatility and higher returns with less risk - unless interest rates go up. I'd really like to see long term simulations of interest rates rising on NTSX (keep in mind long term rising of interest rates could be good for bond yields so if the gap between risk free rate and NTSX bonds widens maybe long term it won't be that bad?? I'm not sure without the math). Anyone have time to do that?! :mrgreen:
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occambogle
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by occambogle »

I was watching NTSX and "seems" like there was a huge volume in the closing hour today. PS - Time is GMT+3.

Image

And Wisdomtree site seems to concur. Isn't that greater than the total AUM? What could explain this?

https://www.wisdomtree.com/etfs/asset-a ... x#fund-nav
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by ChrisBenn »

A big inflow of 1.5x AUM would explain it :).

https://www.morningstar.com/etfs/arcx/ntsx/quote
Looks like total AUM is ~114mil, with 69 mil of inflows on the 12th
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willthrill81
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by willthrill81 »

ChrisBenn wrote: Sat Mar 14, 2020 9:17 pm A big inflow of 1.5x AUM would explain it :).

https://www.morningstar.com/etfs/arcx/ntsx/quote
Looks like total AUM is ~114mil, with 69 mil of inflows on the 12th
Maybe a bear market is what NTSX needed.
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MoneyMarathon
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by MoneyMarathon »

willthrill81 wrote: Sat Mar 14, 2020 10:11 pm
ChrisBenn wrote: Sat Mar 14, 2020 9:17 pm A big inflow of 1.5x AUM would explain it :).

https://www.morningstar.com/etfs/arcx/ntsx/quote
Looks like total AUM is ~114mil, with 69 mil of inflows on the 12th
Maybe a bear market is what NTSX needed.
My first thought: "that's one hell of a tax loss harvest, big spender."
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vineviz
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by vineviz »

willthrill81 wrote: Thu Mar 05, 2020 4:10 pm
lexor wrote: Thu Mar 05, 2020 1:28 pm
occambogle wrote: Thu Mar 05, 2020 1:02 pm It does seem to be doing OK in the current situation for what it is.

Does anyone know a single ETF that holds 60% TSM or S&P500 / 40% Bond, or 80/20? I'd like to add something like that to my watchlist to compare (I know you can easily do in PV, I am talking more realtime).

The only thing that concerns me is the really low volume though I understand that market makers can create units. Now we are currently 3.5hrs into trading on a hugely volatile day, and volume is only 6000.
NTSX is better compared to 100% TSM in my opinion.
I think that it's too early to make that call, but it has certainly outperformed TSM in pretty much every meaningful way over its brief lifespan. It earned higher returns than TSM before the current downturn, but it hasn't dropped as much as TSM in the last two weeks either.
It's a little bit of a weird combination, but take a look at a portfolio consisting of NTSX and Cambria Tail Risk ETF (TAIL).

With 55% NTSX and 45% TAIL (which gets to roughly a 50/50 stock/bond allocation), the YTD performance is +1.12% which is stunning compared to -11.74% for VBIAX and -16.53% for the S&P 500. And the NTSX/TAIL combo was slouch in 2019 either, with +9.63% returns. Could be potent portfolio for early decumulators.
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physixfan
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by physixfan »

ChrisBenn wrote: Sat Mar 14, 2020 9:17 pm A big inflow of 1.5x AUM would explain it :).

https://www.morningstar.com/etfs/arcx/ntsx/quote
Looks like total AUM is ~114mil, with 69 mil of inflows on the 12th
Where did you see the 69 mil of inflow? I only see a ~2 mil inflow on the 11th, nothing special on the 12th.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by willthrill81 »

vineviz wrote: Sat Mar 14, 2020 10:41 pm
willthrill81 wrote: Thu Mar 05, 2020 4:10 pm
lexor wrote: Thu Mar 05, 2020 1:28 pm
occambogle wrote: Thu Mar 05, 2020 1:02 pm It does seem to be doing OK in the current situation for what it is.

Does anyone know a single ETF that holds 60% TSM or S&P500 / 40% Bond, or 80/20? I'd like to add something like that to my watchlist to compare (I know you can easily do in PV, I am talking more realtime).

The only thing that concerns me is the really low volume though I understand that market makers can create units. Now we are currently 3.5hrs into trading on a hugely volatile day, and volume is only 6000.
NTSX is better compared to 100% TSM in my opinion.
I think that it's too early to make that call, but it has certainly outperformed TSM in pretty much every meaningful way over its brief lifespan. It earned higher returns than TSM before the current downturn, but it hasn't dropped as much as TSM in the last two weeks either.
It's a little bit of a weird combination, but take a look at a portfolio consisting of NTSX and Cambria Tail Risk ETF (TAIL).

With 55% NTSX and 45% TAIL (which gets to roughly a 50/50 stock/bond allocation), the YTD performance is +1.12% which is stunning compared to -11.74% for VBIAX and -16.53% for the S&P 500. And the NTSX/TAIL combo was slouch in 2019 either, with +9.63% returns. Could be potent portfolio for early decumulators.
I'm not familiar enough with TAIL to speak about it.

Before the current downturn, I said that 60% NTSX and 40% LTT would be interesting. YTD performance for it would be -1.22%, very respectable in my view.

I agree that such strategies might be very useful for retirees.
“Good and ill have not changed since yesteryear; nor are they one thing among Elves and Dwarves and another among Men.” J.R.R. Tolkien, The Lord of the Rings
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vineviz
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by vineviz »

willthrill81 wrote: Sat Mar 14, 2020 10:47 pm
I'm not familiar enough with TAIL to speak about it.

Before the current downturn, I said that 60% NTSX and 40% LTT would be interesting. YTD performance for it would be -1.22%, very respectable in my view.
Yeah, I like that combination a lot too. I was surprised to see that the correlation of NTSX with TAIL is much lower (-0.87) than with LTT funds (-0.29), which makes for a more diversified pair. Long-term treasuries should have a higher expected return than TAIL, though, which in MOST years will probably lose money on its protective puts.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by ChrisBenn »

physixfan wrote: Sat Mar 14, 2020 10:44 pm
ChrisBenn wrote: Sat Mar 14, 2020 9:17 pm A big inflow of 1.5x AUM would explain it :).

https://www.morningstar.com/etfs/arcx/ntsx/quote
Looks like total AUM is ~114mil, with 69 mil of inflows on the 12th
Where did you see the 69 mil of inflow? I only see a ~2 mil inflow on the 11th, nothing special on the 12th.
69 mil net - it was 45mil the day before - so just subtraction;
Fidelity also listed it directly
Image

I assume it might take awhile to display properly everywhere as the purchaser probably went to wisdomtree directly for share creation. - i.e. they weren't bought on the exchange directly
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by occambogle »

How is everyone feeling about NTSX these days? It seems to have perfomed as expected mostly, limiting the downside during big drops vs 100% S&P500.
But given the increasing likelihood that interest rates are going to approach zero... can someone explain if there is still benefit to the leveraged Treasury futures component? And if so how that would be affected?
If the rate were to be zero, does leveraging that become pointless because it would just be a multiple of zero? Or are the leveraged futures contracts still of value because they are of existing notes/bills that are higher than zero?
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by garlandwhizzer »

willthrill81 wrote:

Before the current downturn, I said that 60% NTSX and 40% LTT would be interesting. YTD performance for it would be -1.22%, very respectable in my view.

I agree that such strategies might be very useful for retirees.
The risk adjusted performance of the above portfolio has been impressive so far in both up and down markets. The potential problem with the strategy would show up in very different market conditions than we have now--rising rates, rising inflation, sluggish economic growth, stagflation in short. 40% LTT plus 6X leverage on the 10% bond exposure would be a massive hurdle to overcome in that rising rate bond bear market situation and the 90% S&P 500 would struggle in real terms in stagflation. We're a long way from that economic situation now--we do have sluggish economic growth, but inflation appears to be on life support for the foreseeable future. Both the assets, S&P 500 and LTT, are volatile but they are usually volatile in the opposite directions and both have in the past had expected positive returns. If however inflation and rising rates occur, the problem is that LTT will have negative real expected long term returns as they had from 1940 - 1980 and this portfolio has a huge load of LTT. As far as risk/return tradeoff goes, I think there are real possibilities for NTSX to be part of the portfolio for the right investor given current market conditions. 60 NTSX/40 LTT to 80 NTSX/20 LTT might work for the right investor but not for me personally. I'll stick with old fashioned stuff.

Garland Whizzer
lexor
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

garlandwhizzer wrote: Sun Mar 15, 2020 12:50 pm
willthrill81 wrote:

Before the current downturn, I said that 60% NTSX and 40% LTT would be interesting. YTD performance for it would be -1.22%, very respectable in my view.

I agree that such strategies might be very useful for retirees.
The risk adjusted performance of the above portfolio has been impressive so far in both up and down markets. The potential problem with the strategy would show up in very different market conditions than we have now--rising rates, rising inflation, sluggish economic growth, stagflation in short. 40% LTT plus 6X leverage on the 10% bond exposure would be a massive hurdle to overcome in that rising rate bond bear market situation and the 90% S&P 500 would struggle in real terms in stagflation. We're a long way from that economic situation now--we do have sluggish economic growth, but inflation appears to be on life support for the foreseeable future. Both the assets, S&P 500 and LTT, are volatile but they are usually volatile in the opposite directions and both have in the past had expected positive returns. If however inflation and rising rates occur, the problem is that LTT will have negative real expected long term returns as they had from 1940 - 1980 and this portfolio has a huge load of LTT. As far as risk/return tradeoff goes, I think there are real possibilities for NTSX to be part of the portfolio for the right investor given current market conditions. 60 NTSX/40 LTT to 80 NTSX/20 LTT might work for the right investor but not for me personally. I'll stick with old fashioned stuff.

Garland Whizzer
Why do you need 40 or 20 extra LTT? I'm normally 100% stocks so I like that NTSX is long stocks.

Anyone have thoughts now than the fed is cutting interest rates to 0? Is NTSX over or can it go on to outperform the S&P500?
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by willthrill81 »

garlandwhizzer wrote: Sun Mar 15, 2020 12:50 pm
willthrill81 wrote:

Before the current downturn, I said that 60% NTSX and 40% LTT would be interesting. YTD performance for it would be -1.22%, very respectable in my view.

I agree that such strategies might be very useful for retirees.
The risk adjusted performance of the above portfolio has been impressive so far in both up and down markets. The potential problem with the strategy would show up in very different market conditions than we have now--rising rates, rising inflation, sluggish economic growth, stagflation in short. 40% LTT plus 6X leverage on the 10% bond exposure would be a massive hurdle to overcome in that rising rate bond bear market situation and the 90% S&P 500 would struggle in real terms in stagflation. We're a long way from that economic situation now--we do have sluggish economic growth, but inflation appears to be on life support for the foreseeable future. Both the assets, S&P 500 and LTT, are volatile but they are usually volatile in the opposite directions and both have in the past had expected positive returns. If however inflation and rising rates occur, the problem is that LTT will have negative real expected long term returns as they had from 1940 - 1980 and this portfolio has a huge load of LTT. As far as risk/return tradeoff goes, I think there are real possibilities for NTSX to be part of the portfolio for the right investor given current market conditions. 60 NTSX/40 LTT to 80 NTSX/20 LTT might work for the right investor but not for me personally. I'll stick with old fashioned stuff.

Garland Whizzer
Yes, it might not do well in staglationary environments. But if that happens, I'm certainly not above being un-BH and hitting the 'sell' button. 8-)

For the record, I don't own any NTSX yet at least.
“Good and ill have not changed since yesteryear; nor are they one thing among Elves and Dwarves and another among Men.” J.R.R. Tolkien, The Lord of the Rings
lexor
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

willthrill81 wrote: Sun Mar 15, 2020 7:01 pm
garlandwhizzer wrote: Sun Mar 15, 2020 12:50 pm
willthrill81 wrote:

Before the current downturn, I said that 60% NTSX and 40% LTT would be interesting. YTD performance for it would be -1.22%, very respectable in my view.

I agree that such strategies might be very useful for retirees.
The risk adjusted performance of the above portfolio has been impressive so far in both up and down markets. The potential problem with the strategy would show up in very different market conditions than we have now--rising rates, rising inflation, sluggish economic growth, stagflation in short. 40% LTT plus 6X leverage on the 10% bond exposure would be a massive hurdle to overcome in that rising rate bond bear market situation and the 90% S&P 500 would struggle in real terms in stagflation. We're a long way from that economic situation now--we do have sluggish economic growth, but inflation appears to be on life support for the foreseeable future. Both the assets, S&P 500 and LTT, are volatile but they are usually volatile in the opposite directions and both have in the past had expected positive returns. If however inflation and rising rates occur, the problem is that LTT will have negative real expected long term returns as they had from 1940 - 1980 and this portfolio has a huge load of LTT. As far as risk/return tradeoff goes, I think there are real possibilities for NTSX to be part of the portfolio for the right investor given current market conditions. 60 NTSX/40 LTT to 80 NTSX/20 LTT might work for the right investor but not for me personally. I'll stick with old fashioned stuff.

Garland Whizzer
Yes, it might not do well in staglationary environments. But if that happens, I'm certainly not above being un-BH and hitting the 'sell' button. 8-)

For the record, I don't own any NTSX yet at least.
Can NTSX still do well now that Fed cut the interest rate to 0-.25? NTSX is my largest position...I'm assuming it will do quite well on Monday compared to SPY, but wondering if I should continue this strategy indefinitely.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by drk »

lexor wrote: Sun Mar 15, 2020 9:40 pm Can NTSX still do well now that Fed cut the interest rate to 0-.25? NTSX is my largest position...I'm assuming it will do quite well on Monday compared to SPY, but wondering if I should continue this strategy indefinitely.
Looking at how this portfolio would have done the last time the Fed cut to 0, it seems like it should hold up just fine.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by willthrill81 »

lexor wrote: Sun Mar 15, 2020 9:40 pm
willthrill81 wrote: Sun Mar 15, 2020 7:01 pm
garlandwhizzer wrote: Sun Mar 15, 2020 12:50 pm
willthrill81 wrote:

Before the current downturn, I said that 60% NTSX and 40% LTT would be interesting. YTD performance for it would be -1.22%, very respectable in my view.

I agree that such strategies might be very useful for retirees.
The risk adjusted performance of the above portfolio has been impressive so far in both up and down markets. The potential problem with the strategy would show up in very different market conditions than we have now--rising rates, rising inflation, sluggish economic growth, stagflation in short. 40% LTT plus 6X leverage on the 10% bond exposure would be a massive hurdle to overcome in that rising rate bond bear market situation and the 90% S&P 500 would struggle in real terms in stagflation. We're a long way from that economic situation now--we do have sluggish economic growth, but inflation appears to be on life support for the foreseeable future. Both the assets, S&P 500 and LTT, are volatile but they are usually volatile in the opposite directions and both have in the past had expected positive returns. If however inflation and rising rates occur, the problem is that LTT will have negative real expected long term returns as they had from 1940 - 1980 and this portfolio has a huge load of LTT. As far as risk/return tradeoff goes, I think there are real possibilities for NTSX to be part of the portfolio for the right investor given current market conditions. 60 NTSX/40 LTT to 80 NTSX/20 LTT might work for the right investor but not for me personally. I'll stick with old fashioned stuff.

Garland Whizzer
Yes, it might not do well in staglationary environments. But if that happens, I'm certainly not above being un-BH and hitting the 'sell' button. 8-)

For the record, I don't own any NTSX yet at least.
Can NTSX still do well now that Fed cut the interest rate to 0-.25? NTSX is my largest position...I'm assuming it will do quite well on Monday compared to SPY, but wondering if I should continue this strategy indefinitely.
I would think that it would still do well as long as the long-term yield curve isn't inverted, but I'm no expert on fixed income.
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lexor
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

drk wrote: Sun Mar 15, 2020 9:52 pm
lexor wrote: Sun Mar 15, 2020 9:40 pm Can NTSX still do well now that Fed cut the interest rate to 0-.25? NTSX is my largest position...I'm assuming it will do quite well on Monday compared to SPY, but wondering if I should continue this strategy indefinitely.
Looking at how this portfolio would have done the last time the Fed cut to 0, it seems like it should hold up just fine.
Looks like when interest rates are slowly going up it tied the S&P 500...not great but not terrible https://www.portfoliovisualizer.com/bac ... ion3_1=-50
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by MoneyMarathon »

occambogle wrote: Sun Mar 15, 2020 12:35 pm How is everyone feeling about NTSX these days? It seems to have perfomed as expected mostly, limiting the downside during big drops vs 100% S&P500.
But given the increasing likelihood that interest rates are going to approach zero... can someone explain if there is still benefit to the leveraged Treasury futures component? And if so how that would be affected?
This is the treasury yield curve:

https://www.treasury.gov/resource-cente ... data=yield

These yields are determined by market participants. They don't hold at an amount the Fed sets. The Fed sets the short end of the yield curve, which is also known as the rate. Longer duration treasuries can be lower yield (an inverted yield curve) or higher yield.

The idea of dampening of stock market volatility is mostly due to change in yield.

And yields will still be changing, as they did when Ben led the Fed to zero rates before.
occambogle wrote: Sun Mar 15, 2020 12:35 pmIf the rate were to be zero, does leveraging that become pointless because it would just be a multiple of zero?
If 10% of the portfolio were invested in GOVT (iShares treasury bond, unleveraged), the changes in yield would not have much effect on the portfolio. The main purpose of leverage is to increase the impact of this portion of the portfolio, while still keeping the impact of 90% stocks also.
occambogle wrote: Sun Mar 15, 2020 12:35 pmOr are the leveraged futures contracts still of value because they are of existing notes/bills that are higher than zero?
This has no effect. It's not really possible to buy a bond with a different yield than what the market offers. The old bonds are repriced to have the same yield. When the yield goes down, the price appreciates, and there's no benefit to new buyers.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

MoneyMarathon wrote: Mon Mar 16, 2020 12:11 am
occambogle wrote: Sun Mar 15, 2020 12:35 pm How is everyone feeling about NTSX these days? It seems to have perfomed as expected mostly, limiting the downside during big drops vs 100% S&P500.
But given the increasing likelihood that interest rates are going to approach zero... can someone explain if there is still benefit to the leveraged Treasury futures component? And if so how that would be affected?
This is the treasury yield curve:

https://www.treasury.gov/resource-cente ... data=yield

These yields are determined by market participants. They don't hold at an amount the Fed sets. The Fed sets the short end of the yield curve, which is also known as the rate. Longer duration treasuries can be lower yield (an inverted yield curve) or higher yield.

The idea of dampening of stock market volatility is mostly due to change in yield.

And yields will still be changing, as they did when Ben led the Fed to zero rates before.
occambogle wrote: Sun Mar 15, 2020 12:35 pmIf the rate were to be zero, does leveraging that become pointless because it would just be a multiple of zero?
If 10% of the portfolio were invested in GOVT (iShares treasury bond, unleveraged), the changes in yield would not have much effect on the portfolio. The main purpose of leverage is to increase the impact of this portion of the portfolio, while still keeping the impact of 90% stocks also.
occambogle wrote: Sun Mar 15, 2020 12:35 pmOr are the leveraged futures contracts still of value because they are of existing notes/bills that are higher than zero?
This has no effect. It's not really possible to buy a bond with a different yield than what the market offers. The old bonds are repriced to have the same yield. When the yield goes down, the price appreciates, and there's no benefit to new buyers.
Are you saying it is pointless or isn't? I would think if yields are negative or zero it would be pointless or even detrimental because you're still paying for the leverage (unless rates continued to drop I guess).

As an aside my understanding is that yields are not zero but rather a range from 0-.25.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by columbia »

I don’t know if it’s done what it’s supposed to do, but NTSX has definitely slowed losses compared to VOO in 2020.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by PluckyDucky »

NTSX is showing down 17.6% right now with SPX only down 9.67% per Yahoo Finance.

:shock:
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by occambogle »

PluckyDucky wrote: Mon Mar 16, 2020 9:11 am NTSX is showing down 17.6% right now with SPX only down 9.67% per Yahoo Finance.

:shock:
I'm seeing -10.94 NTSX vs -9.64 SPX. There's very low volume in NTSX so far. But still a bit surprising
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by bmusic »

occambogle wrote: Mon Mar 16, 2020 9:13 am
PluckyDucky wrote: Mon Mar 16, 2020 9:11 am NTSX is showing down 17.6% right now with SPX only down 9.67% per Yahoo Finance.

:shock:
I'm seeing -10.94 NTSX vs -9.64 SPX. There's very low volume in NTSX so far. But still a bit surprising
The spread is very wide. The best thing to keep an eye on, I believe, is the indicative intraday value.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by corp_sharecropper »

PluckyDucky wrote: Mon Mar 16, 2020 9:11 am NTSX is showing down 17.6% right now with SPX only down 9.67% per Yahoo Finance.

:shock:
Not seeing what you're seeing
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by occambogle »

Pricing seems to be back to what one might expect. The volume of NTSX generally is very low I think.
bmusic wrote: Mon Mar 16, 2020 9:18 am The spread is very wide. The best thing to keep an eye on, I believe, is the indicative intraday value.
Could you explain? And where one might see this data?
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by bmusic »

occambogle wrote: Mon Mar 16, 2020 9:52 am Pricing seems to be back to what one might expect. The volume of NTSX generally is very low I think.
bmusic wrote: Mon Mar 16, 2020 9:18 am The spread is very wide. The best thing to keep an eye on, I believe, is the indicative intraday value.
Could you explain? And where one might see this data?
Pretty much any quote page should show the bid/ask. The spread between them was rather large this morning. They've since tightened up.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

bmusic wrote: Mon Mar 16, 2020 9:55 am
occambogle wrote: Mon Mar 16, 2020 9:52 am Pricing seems to be back to what one might expect. The volume of NTSX generally is very low I think.
bmusic wrote: Mon Mar 16, 2020 9:18 am The spread is very wide. The best thing to keep an eye on, I believe, is the indicative intraday value.
Could you explain? And where one might see this data?
Pretty much any quote page should show the bid/ask. The spread between them was rather large this morning. They've since tightened up.
Could someone write up how to calculate the NAV interday so you know if you are overpaying for the underlying assets?
Last edited by lexor on Mon Mar 16, 2020 9:59 am, edited 1 time in total.
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bmusic
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by bmusic »

bmusic wrote: Mon Mar 16, 2020 9:55 am
occambogle wrote: Mon Mar 16, 2020 9:52 am Pricing seems to be back to what one might expect. The volume of NTSX generally is very low I think.
bmusic wrote: Mon Mar 16, 2020 9:18 am The spread is very wide. The best thing to keep an eye on, I believe, is the indicative intraday value.
Could you explain? And where one might see this data?
Pretty much any quote page should show the bid/ask. The spread between them was rather large this morning. They've since tightened up.
Sorry, I missed it, but my Fidelity Quote/Research page has indicative intraday value if you expand the "More Quote Info".
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

bmusic wrote: Mon Mar 16, 2020 9:59 am
bmusic wrote: Mon Mar 16, 2020 9:55 am
occambogle wrote: Mon Mar 16, 2020 9:52 am Pricing seems to be back to what one might expect. The volume of NTSX generally is very low I think.
bmusic wrote: Mon Mar 16, 2020 9:18 am The spread is very wide. The best thing to keep an eye on, I believe, is the indicative intraday value.
Could you explain? And where one might see this data?
Pretty much any quote page should show the bid/ask. The spread between them was rather large this morning. They've since tightened up.
Sorry, I missed it, but my Fidelity Quote/Research page has indicative intraday value if you expand the "More Quote Info".
Is that inter-day NAV? Or just interday market price. Even with such high liquidity in the underlying assets, it seems that interday market price can be off by a lot.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

corp_sharecropper wrote: Mon Mar 16, 2020 9:28 am
PluckyDucky wrote: Mon Mar 16, 2020 9:11 am NTSX is showing down 17.6% right now with SPX only down 9.67% per Yahoo Finance.

:shock:
Not seeing what you're seeing
I'm not seeing it either...did it actually happen? That's a crazy spread and maybe we should be avoiding market orders....
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by bmusic »

lexor wrote: Mon Mar 16, 2020 9:58 am
bmusic wrote: Mon Mar 16, 2020 9:55 am
occambogle wrote: Mon Mar 16, 2020 9:52 am Pricing seems to be back to what one might expect. The volume of NTSX generally is very low I think.
bmusic wrote: Mon Mar 16, 2020 9:18 am The spread is very wide. The best thing to keep an eye on, I believe, is the indicative intraday value.
Could you explain? And where one might see this data?
Pretty much any quote page should show the bid/ask. The spread between them was rather large this morning. They've since tightened up.
Could someone write up how to calculate the NAV interday so you know if you are overpaying for the underlying assets?
Some sites like Fidelity calculate it. Otherwise, a simple formula that gets you close is - SPY*.9 + IEF*.6. The bond portion is the part that's can be a little off, as they are using derivatives.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by bmusic »

lexor wrote: Mon Mar 16, 2020 9:59 am
bmusic wrote: Mon Mar 16, 2020 9:59 am
bmusic wrote: Mon Mar 16, 2020 9:55 am
occambogle wrote: Mon Mar 16, 2020 9:52 am Pricing seems to be back to what one might expect. The volume of NTSX generally is very low I think.
bmusic wrote: Mon Mar 16, 2020 9:18 am The spread is very wide. The best thing to keep an eye on, I believe, is the indicative intraday value.
Could you explain? And where one might see this data?
Pretty much any quote page should show the bid/ask. The spread between them was rather large this morning. They've since tightened up.
Sorry, I missed it, but my Fidelity Quote/Research page has indicative intraday value if you expand the "More Quote Info".
Is that inter-day NAV? Or just interday market price. Even with such high liquidity in the underlying assets, it seems that interday market price can be off by a lot.
I believe it's intraday nav, but am not 100% certain.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

bmusic wrote: Mon Mar 16, 2020 10:03 am
lexor wrote: Mon Mar 16, 2020 9:58 am
bmusic wrote: Mon Mar 16, 2020 9:55 am
occambogle wrote: Mon Mar 16, 2020 9:52 am Pricing seems to be back to what one might expect. The volume of NTSX generally is very low I think.
bmusic wrote: Mon Mar 16, 2020 9:18 am The spread is very wide. The best thing to keep an eye on, I believe, is the indicative intraday value.
Could you explain? And where one might see this data?
Pretty much any quote page should show the bid/ask. The spread between them was rather large this morning. They've since tightened up.
Could someone write up how to calculate the NAV interday so you know if you are overpaying for the underlying assets?
Some sites like Fidelity calculate it. Otherwise, a simple formula that gets you close is - SPY*.9 + IEF*.6. The bond portion is the part that's can be a little off, as they are using derivatives.
Good point that should be pretty accurate
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by occambogle »

The volume just seems very low so it doesn't react much to changes... NTSX vs VTI:

https://imgur.com/a/DT2R1cJ
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by bmusic »

One thing I have noticed about NTSX, is that despite low volume, there is usually a trade near the close that normally get it pretty close to NAV.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by SirBotsALots »

Is this fund too heavily correlated to equities to consider using it to replace a portion of bond allocation? Currently 90/10 with 30+ year time horizon, considering replacing a chunk of my bond allocation with this.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

SirBotsALots wrote: Mon Mar 16, 2020 11:29 am Is this fund too heavily correlated to equities to consider using it to replace a portion of bond allocation? Currently 90/10 with 30+ year time horizon, considering replacing a chunk of my bond allocation with this.
Yes if you expect it to perform like bonds. It performs closer to 100% equities with some downside protection.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by caklim00 »

If one wants to get a lot of downside protection via NTSX you are going to have to pair it with either some very long term bonds (like EDV) or roll your own treasury futures. I'm now (excluding emrgency cash) 100/50/-50 stock/bonds/cash via a mixture of stock funds, and treasury futures. The treasury futures have provided some/minimal downside protection (very similar to NTSX). NTSX really isn't supposed to provide much downside protection, its promoted more at slightly boosting returns.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by Uncorrelated »

Long term bonds or treasury futures don't provide downside protection. If you want downside protection, use put options or move your portfolio towards lower risk investments such as BND or money market accounts. Relying on leveraged treasuries for downside protection is a recipe for blowing up in your face at the most unproportionate times.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

Uncorrelated wrote: Mon Mar 16, 2020 2:12 pm Long term bonds or treasury futures don't provide downside protection. If you want downside protection, use put options or move your portfolio towards lower risk investments such as BND or money market accounts. Relying on leveraged treasuries for downside protection is a recipe for blowing up in your face at the most unproportionate times.
NTSX has treasury ladder though to be clear. Why do you expect it to blow up?
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by Uncorrelated »

lexor wrote: Mon Mar 16, 2020 2:32 pm
Uncorrelated wrote: Mon Mar 16, 2020 2:12 pm Long term bonds or treasury futures don't provide downside protection. If you want downside protection, use put options or move your portfolio towards lower risk investments such as BND or money market accounts. Relying on leveraged treasuries for downside protection is a recipe for blowing up in your face at the most unproportionate times.
NTSX has treasury ladder though to be clear. Why do you expect it to blow up?
I don't expect it to blow up. I simply disagree with the usage of downside protection for this particular ETF. The leveraged treasuries inside NTSX have higher risk than unleveraged treasuries. It's worth taking that risk because you're well compensated for it, but it's simply more risky than unleveraged treasuries.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

Uncorrelated wrote: Mon Mar 16, 2020 2:40 pm
lexor wrote: Mon Mar 16, 2020 2:32 pm
Uncorrelated wrote: Mon Mar 16, 2020 2:12 pm Long term bonds or treasury futures don't provide downside protection. If you want downside protection, use put options or move your portfolio towards lower risk investments such as BND or money market accounts. Relying on leveraged treasuries for downside protection is a recipe for blowing up in your face at the most unproportionate times.
NTSX has treasury ladder though to be clear. Why do you expect it to blow up?
I don't expect it to blow up. I simply disagree with the usage of downside protection for this particular ETF. The leveraged treasuries inside NTSX have higher risk than unleveraged treasuries. It's worth taking that risk because you're well compensated for it, but it's simply more risky than unleveraged treasuries.
I agree but certainly safer than something that leverages equities like UPRO or LEAPs I'd think...
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by MoneyMarathon »

lexor wrote: Mon Mar 16, 2020 1:31 am
MoneyMarathon wrote: Mon Mar 16, 2020 12:11 am
occambogle wrote: Sun Mar 15, 2020 12:35 pm How is everyone feeling about NTSX these days? It seems to have perfomed as expected mostly, limiting the downside during big drops vs 100% S&P500.
But given the increasing likelihood that interest rates are going to approach zero... can someone explain if there is still benefit to the leveraged Treasury futures component? And if so how that would be affected?
This is the treasury yield curve:

https://www.treasury.gov/resource-cente ... data=yield

These yields are determined by market participants. They don't hold at an amount the Fed sets. The Fed sets the short end of the yield curve, which is also known as the rate. Longer duration treasuries can be lower yield (an inverted yield curve) or higher yield.

The idea of dampening of stock market volatility is mostly due to change in yield.

And yields will still be changing, as they did when Ben led the Fed to zero rates before.
occambogle wrote: Sun Mar 15, 2020 12:35 pmIf the rate were to be zero, does leveraging that become pointless because it would just be a multiple of zero?
If 10% of the portfolio were invested in GOVT (iShares treasury bond, unleveraged), the changes in yield would not have much effect on the portfolio. The main purpose of leverage is to increase the impact of this portion of the portfolio, while still keeping the impact of 90% stocks also.
occambogle wrote: Sun Mar 15, 2020 12:35 pmOr are the leveraged futures contracts still of value because they are of existing notes/bills that are higher than zero?
This has no effect. It's not really possible to buy a bond with a different yield than what the market offers. The old bonds are repriced to have the same yield. When the yield goes down, the price appreciates, and there's no benefit to new buyers.
Are you saying it is pointless or isn't? I would think if yields are negative or zero it would be pointless or even detrimental because you're still paying for the leverage (unless rates continued to drop I guess).

As an aside my understanding is that yields are not zero but rather a range from 0-.25.
"yields are not zero but rather a range from 0-.25"
The Fed controls only the short term rate. The Fed indeed sets a range.

Definition from: https://www.federalreserve.gov/monetary ... market.htm
"the federal funds rate--the interest rate at which depository institutions lend reserve balances to other depository institutions overnight"

Again, this is the yield curve:
https://www.treasury.gov/resource-cente ... data=yield

There seem to be some misunderstandings that are lurking somewhere, although maybe not made explicitly or all by one person:

(1) Misunderstanding: There is such a thing as "yields" or "rates" and they're basically the same thing or move the same way.

There's a yield curve. Different duration bonds have different yields. They move separately. The word "rates" refers only to the shortest duration.

(2) Misunderstanding: There are fixed borrowing costs for leverage.

These funds generally use a duration between 1 month and 3 months for their leverage, maybe as long as 2 years. When the rates go down, the costs of leverage go down too.

(3) Misunderstanding: When rates are set to zero, there's no more drop in yields unless rates go negative.

There's a yield curve. The yields are different for different durations. At longer duration, yields always continue to change, independent of Fed action, depending on market participants and who's trying to buy or sell bonds.

(4) Misunderstanding: When paying for leverage, returns are negative if yields don't change.

This is only sometimes true. It depends on the total costs of the fund, and it depends on the shape of the yield curve. Given the low costs of NTSX, for example, and given the way rates were cut, the yield on long term bonds is currently high enough to provide positive returns through dividends. Just a couple weeks ago, the yield curve was inverted, and the dividend return was small to slightly negative.

(5) Misunderstanding: Leveraging bonds makes sense only if you expect yields to go down.

Leveraging bonds can make sense as part of portfolio construction in a long term buy and hold strategy, where there is no attempt to predict whether yields go up and down.

(6) Misunderstanding: There is a lot of significance to 0 yields or 0 rates.

We don't know the true lower bound of nominal yields for US treasuries. And we don't have to know. The market will decide where the lower bound is. If it's reached, then the longer duration bonds will lose value when yields go up again. This will happen whether it's at 1% yield, 0.5% yield, 0% yield, -0.5% yield, or -1% yield. We could lose value in long duration bonds without ever bouncing off zero yields (going up sooner), or we could go to zero yield and start losing value at that point, or the yield could go negative first before it starts going up. Again, it's not necessary to change a buy and hold strategy.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by ChrisBenn »

lexor wrote: Mon Mar 16, 2020 9:58 am
bmusic wrote: Mon Mar 16, 2020 9:55 am
occambogle wrote: Mon Mar 16, 2020 9:52 am Pricing seems to be back to what one might expect. The volume of NTSX generally is very low I think.
bmusic wrote: Mon Mar 16, 2020 9:18 am The spread is very wide. The best thing to keep an eye on, I believe, is the indicative intraday value.
Could you explain? And where one might see this data?
Pretty much any quote page should show the bid/ask. The spread between them was rather large this morning. They've since tightened up.
Could someone write up how to calculate the NAV interday so you know if you are overpaying for the underlying assets?
Wisdomtree publishes the nav intraday as the NTSX.IV ticker:
https://finance.yahoo.com/quote/%5ENTSX ... %5ENTSX-IV
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by guyinlaw »

AUM is up to 106 million.. This fund is here to stay..
Time is your friend; impulse is your enemy. - John C. Bogle
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by HawkeyePierce »

YTD:

NTSX: -13.2%

USMV: -17.0%

VOO: -22.3%

Alternate strategies having their day in the sun so far in 2020.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by HEDGEFUNDIE »

HawkeyePierce wrote: Tue Mar 17, 2020 11:16 pm YTD:

NTSX: -13.2%

USMV: -17.0%

VOO: -22.3%

Alternate strategies having their day in the sun so far in 2020.
Don't forget SWAN -3.2%
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by lexor »

HEDGEFUNDIE wrote: Wed Mar 18, 2020 12:54 am
HawkeyePierce wrote: Tue Mar 17, 2020 11:16 pm YTD:

NTSX: -13.2%

USMV: -17.0%

VOO: -22.3%

Alternate strategies having their day in the sun so far in 2020.
Don't forget SWAN -3.2%
What about TMF+UPRO YTD?
Last edited by lexor on Wed Mar 18, 2020 1:28 am, edited 1 time in total.
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Re: WisdomTree 90/60 U.S. Balanced Fund [NTSX]

Post by DonIce »

HEDGEFUNDIE wrote: Wed Mar 18, 2020 12:54 am Don't forget SWAN -3.2%
I was just looking at that recently. What are your thoughts on SWAN vs NTSX (in general, not just in the context of the current downswing)?

NTSX is effectively 90/60, while SWAN's target exposure is 70/90. SWAN's ratio is certainly closer to risk parity. However, holding long calls on SPY seems like a higher cost strategy than holding treasury futures. Any thoughts on if SWAN will be able to approximate the returns of a 70/90 strategy with comparable fidelity as NTSX has been approximating the returns of 90/60?
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