If you do want to invest, as I’m thinking about it, I think investing in ETFs is the smart way to go.

But looks like the best one, and also part of Kiplinger’s 25, and one that I own, is .

Large Cap Value

Comparing it to Fidelity Contrafund, which is considered one the top funds, I can see why Yacktman is on top: 3 year return of 8.9% is much better than -0.2% for the Fidelity fund.

Foreign Large Cap Blend

Very good returns. Better than Marsico Global, also a top rated fund.

Very good returns.

Fidelity Select Defense & Aerospace

iShares Dow Jones US Aerospace & Defense

Source: Kiplinger’s

It’s good to rebalance every year or so. It’s been a while since I’ve done it. But because we had a decent dip recently, I think it might be a good time for me to do so. Plus, I have come across some excellent Mutual Funds in the Kiplinger’s magazine — I always try to buy their yearly issue focused on Mutual Funds.

Here are some funds which I like and which I picked mostly from that issue. I’m entering trades as I’m writing this post.

Bond Funds

A pair of the best and most famous bond funds, as per Kiplinger’s.

(also available as an ETF, )

Another of our favorites, same source.

The portfolio of Harbor more or less reflects the distilled wisdom of Bill Gross and his colleagues at Pimco. Kiplinger’s top 25 pick.

(also available as an ETF, )
For added security, it’s always have to have some TIPS.

Large-Company Funds

Recently reopened. Kiplinger’s Top 25.

Kiplinger’s Top 25. Impressive returns.

International Funds

Very good returns. Kiplinger’s top 25 pick.

Good returns as well. I like it.

There you have it!

This article, Is It Time to Buy a House Yet?, was part of today’s Must Read newsletter from Seeking Alpha (a good resource for investors). It caught my attention. I like to read stories about housing. But what really caught my attention was the chart you just saw.

Do we really have a few more years of downturn? I think so. I don’t think we’re out of the woods yet. But as with everything, and especially money issues, you never know.

Mr. Smith does have some valid and interesting points. Here a few.

Simply put: if the bubble took seven years to reach its blow-off top, then its decline will typically take a similar length of time as prices fully retrace to pre-bubble levels.

As for supply: it is common knowledge that hundreds of thousands of homes are currently in the limbo of “shadow inventory”–homes the lenders won’t foreclose on for fear they can’t be sold, homes held off the market by owners who are deeply underwater on their mortgages, etc. As soon as demand appears, then supply rockets up as those anxious to sell move properties from the “shadow inventory” into the market.

Interesting article to read.

John Mauldin, Millennium Wave Advisors
“A healthy dose of cash and other forms of fixed income may be the best prescription for 2010.”

Mauldin recommends putting money temporarily in short-maturity corporate and municipal bond ETFs like and .

He sees the economy headed for a second recessionary dip later this year, and so recommends rotating into defensive funds — particularly, high-dividend-payers like or .

Mauldin also likes health-care funds, especially those with biotechnology exposure such as . He is bullish on biotech: One of the purer plays is .

“Wait for the real buying opportunity.”

Longer term, Mauldin recommends gradually shifting portfolio weights from securities of developed countries whose valuations “are out of whack” toward higher-growth markets through ETFs like or .

“Be patient and wait for markets to come to you,” he counsels. “Patience is a position, too.”

Stephen Blumenthal, President, CMG Capital Management Group
“If the recent past was the equivalent of a bungee ride, the year ahead will be more like a roller coaster. The market should continue chugging higher until April or May, when he expects a plunge, perhaps followed by another upturn before year’s end.”

“To cope with that uncertainty, it’s best to play fixed-income-based ETFs during the first quarter at least.” favorite vehicle is

Anticipating prolonged weakness in the U.S. dollar, Blumenthal recommends gradual acquisition of Pacific/Asia commodity producers/users represented by ETFs like . He finds the particularly attractive as a simultaneous play on commodity-rich Australia, its relatively strong currency, and China. A rebound in China, the world’s largest commodity consumer, should lift and as well as agriculture. CMG recommends , and, for exposure to so-called soft commodities like rice and cotton, .

“Sell the rallies and trade tactically until we get a correction,” Blumenthal advises. In other words, take profits when common measures of investor sentiment are bullish, and shop for bargains on market dips.

Thomas Orecchio, Modera Wealth Mgmt.

He uses international bond funds like to balance U.S. dollar-heavy portfolios.

Even though their share prices have run up lately, developing countries have better growth prospects than developed economies, he says. Modera also is rotating into international bond funds like and for fixed income, but gradually.

This year, Orecchio expects to see many more new ETFs like the , which uses hedging techniques to offset risk

Sorted by 2009 Total Return

98% Europe, 1% Asia, 1% Latin America

70% Africa/Middle East, 30% Europe

100% Africa/Middle East

51% Latin America, 26% Africa/Middle East, 17% Europe, 6% Asia

50% Africa/Middle East, 25% Asia, 22% Europe, 3% Latin America

I also think the long term the dollar does not look so good. Especially when comparing it to emerging markets.

Read on…

You can invest in emerging-markets bonds through  . “Pimco invests in 15 markets, including Poland, South Africa, Mexico, and Thailand.” It’s on the expensive side, though, with an annual cost of 1.35%. I try to stay under 1%, but this might be worth the price.

For a lower cost alternative, check . “This exchange-traded fund, launched last summer, uses futures contracts to provide exposure to money-market rates of 11 emerging markets currencies, including the Polish zloty, Chinese yuan and Chilean peso.” Annual fee is 0.55%.