Painting Portfolios

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I’m thinking about monetizing the site.

I’m ambivalent about adding advertising and affiliate links to my blog. But I’m strongly considering it.

The main plus as I can see it is that it might bring me some more readers.

I believe in my message. And I love writing. So this instinct to expand the reach of my voice is a strong one.

To be honest it’s probably the strongest instinct of all.

And then there’s the money aspect. As in “more money more better.”

But I have a number of reservations as well.

Up to this point, writing posts has been a pure outlet for me. It is the opposite of a job. As it stands there is no profit motive. It’s just me and a pen and my own stream of consciousness.

So if I want to spew my unique flavor of liberal bile, I do.

And If I want to publish off-color humor, there’s no profit motive stopping me.

If I offend you, so be it. At least I’m being honest.

And if I find a video of a naked German dude jumping onto an icy swimming pool and it cracks me up, there’s nothing to stop me from just posting that completely unrelated video right on the blog.

(I get paid nothing if you watch this video, and yet it is important to me that you do…)

Once money enters the picture, however, it has its own gravity and it has the tendency to effect this sort of unfettered artistic expression.

Money is the ultimate conflict of interest.

If there can be said to be a universal human impulse, I would argue that it is the desire to achieve more wealth with less work.

So once I have an advertisement for a credit card on my page that pays me X amount every time someone applies to the card through my link, there will be some small part of me wondering “what could it hurt just to promote that card a little bit?”

Art becomes commerce.

And whether or not I can resist this urge, that little voice will be there, and I worry that it will affect my writing tone in some small way.

I will be conflicted. And all that I can vow now,  is that I will announce my conflicts of interest whenever I’m aware of them.

And I welcome you  to call me out on any future conflicts in my writing should you become aware of them.

But it strikes me that one thing that I should do prior to accepting any advertisers is to advocate for the products that I truly believe to be excellent.

After all I am still unconflicted. So I thought I would take advantage of my own lack of ulterior motives to talk about a product that I think is quality.

I have already discussed Betterment, which I think is the best investment option for someone who has little interest in investing. And I have some of my own money in Betterment, in fact. is a different online platform for investment. And it strengths are very complementary to Betterments.

Whereas Betterment is a set it and forget it concept where your pour your money into a well diversified portfolio that literally rebalances itself for a fair price, Motif affords you some real creativity.

You can get your hands dirty so to speak.

And for someone like me who loves thinking about investing, it is a ton of fun.

Essentially the way it works is that you can make a portfolio of up to 30 stocks or ETFs (Mutual funds that are traded on  stock exchanges.)

You can also select motifs designed by the website itself, but where’s the fun in that?

As I can see it there are really two main strengths of Motif for a do-it-yourself investor.

1. You can rebalance an entire portfolio for $9.95.

Normally when you buy or sell a fund within your portfolio you must pay a transaction fee for each fund or stock purchase.

So if you had a portfolio with 10 ETFs and during rebalancing time you realize that you must sell some portion of 4 of your overweighted ETFs and purchase additional amounts of 4 of your underweighted ETFs, then you would have to pay a transaction fee on all four purchases.

So if it cost you five dollars to make a trade it would cost you 20 bucks to rebalance the portfolio.

With Motif you can simply reset all of your ETFs back to their original percentages and hit rebalance and you only pay for one transaction ($9.95). So if you had a portfolio with $500,000 and you wanted to rebalance it once a year you would simply have to pay $10 a year to rebalance it. (A Roughly .002% addition to your expense ratio. Costs matter, but not to the 3rd decimal place in the scale of a human lifetime)

It is also worth mentioning that you can select from literally the entire universe ETFs and stocks to make your portfolio. So you can own your absolute favorite ETF within each category of your portfolio.

2. You can do prospective modeling of different portfolios to see how they behave in the real world.

This is what I really love about Motif. And it doesn’t even have to involve actual investments. (Though I have those too.)

Since you can create an infinite number of portfolios, you can test out any theory that you happen to be interested in at any time

As an example there are 12 different motifs that I have created thus far.

There’s my patented MD Squared slice and dice portfolio, plus a similar one with momentum added, plus one with 50% bonds and riskier ETFs, plus motifs that blend quality, momentum, and value factors, then there’s a simple ETF momentum strategy similar to the one I wrote about here.

Basically every time I get an idea about how to design a portfolio, I create a new virtual portfolio on Motif and follow it going forward.

For investment geeks like me there’s some serious entertainment value in this, as well as some serious education.

I think of it as a test drive for my portfolio ideas

I can essentially gamble with Monopoly money before putting down my first real dollar.

To me this is fun. And if it sounds like fun to you, I strongly suggest you take Motif for a test drive.

Creating portfolios is free and fun and possibly profitable. Which it seems to me is a pretty useful combination for any prospective early retiree.

If you’d like me to help you design a portfolio, drop me a line. (Remember, I love this stuff.)

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