Adaptive Timer Signals CASH on F-Fund

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Summary

• We are presently 100% LONG in the portfolio in the C-Fund, S-Fund, and I-Fund.  Gain since the last signal (March 28), at the target percentages, is +1.492%.  We peaked at a gain of 2.042% this past Wednesday, so we have given up -0.55%.  Contrasting, the S-Fund peaked at 3.677% and has dropped to 2.353%, a loss of -1.324%, and the I-Fund peaked Friday at 3.201%.  Note that these are weighted performance values, e.g., with the allocations in the next bullet.
• Our portfolio allocations are 98% in the C-Fund, with 1% in the I- and S-Funds.  The allocation represents the best reward/risk on a short-term basis, and you see this volatility above in the 1st bullet.
• The F-Fund has signaled a move to CASH.  You probably do not want any money in the F-Fund right now, and I never put any there.
• While there are signs of a topping market, I see no compelling reason to move anything to cash.  If you're nervous, then go ahead, but for my particular circumstance, I'm sitting pat.

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Relative Market Volatility

I've presented the following graph numerous times over the last months -- it gives us a good view of the market as a whole in terms of volatility.  Generally, when short-term volatility is low, the VXX has a lower number than the longer-term VXZ, and the ratio rises.  A dropping VXX generally corresponds to an increasing market, in general.

The top graph is the SLOPE of the weekly moving average of the ratio VXZ to the VXX (these are ETFs -- look them up here to learn more about these specific entities).  The important thing is that the slope is positive AND it's pointing upward.  This really is all that you need to know.  If you want to bookmark this chart, here's the link.

The bottom graph is the ratio of the longer-termed volatility ETF VXZ to the shorter-termed volatility ETF VXX.  We see that the ratio has closed for 3 weeks above the 7w moving average, which I consider bullish for holding our funds.

Of course, this makes no representation as to what the following week will hold.  The markets could collapse, or they could move higher -- your crystal ball is as good as mine.  All I can say is that as of this writing that we need to be in the markets, and based on signals the last week of the month -- we are.

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New CASH signal on F-Fund

I personally do not trade the F-Fund, but I track it.  As of the close of business Wednesday, April 6th, the GGT Adaptive Timer signaled a move to CASH for the F-Fund.  Note that this is calculated using the actual prices for the F-Fund, not on the ETF proxy that I sometimes use, AGG.  

If you are trading this fund, and again, I don't, but if YOU are, it probably is prudent to move to CASH.  The earliest you could have moved would have been Thursday night, and Friday's close was 0.9997 of Thursday's close, e.g., the same value for all intensive purposes.  Since our signal on March 28th the F-Fund has DROPPED -0.254%, but allocations were 0%, so if you had listened to me, you'd resisted any temptation to put money in the F-Fund.  :o)   -0.254% may not sound like a lot, but on $100K it's $254, which is a large number of Starbucks venti lattes.

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Remember, you are responsible for your own trading decisions, and I am not.  Please do your own diligence, and please take ownership for your actions.

Regards,

pgd