Jumping back into the market on Friday, 11/15

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Another whipsaw, this time back into the market.

I don't make the signals, I simply follow what the signals tell me to do:

Here we go:

C-Fund:  58%
S-Fund:  28%
I-Fund:  14%

This is an aggressive move.

The conservative approach only has a 4% addition to the F-Fund, so you can move the values above to add 4% as you see fit.

Here is the performance to date.

Here's the overall performance since 11/25/08:

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

Regards,

pgd

Moving to Cash Effective 11/8/2013

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All,

Effective today, I'm transitioning to the G-Fund (100% Cash).  With last night's action I received confirmation that market internals are rapidly dropping support of the leading stocks and consequently, it's time to protect the foundation.

This signal has not been profitable, but the last rolling 12 months has been:

Of course, I don't know the final numbers on the existing signal because I won't get the closing numbers until tonight, but it appears that the C-Fund is up 2.7%, the S-Fund is down -1.7%, and the I-Fund is up 1.5% from our last entry.  We were heavily weighted into the I and S-funds, so net is probably a wash.

Place your orders by noon EDT today at www.tsp.gov and they'll be effective tonight.

Regards,

Paul

Moving Long on 10/15/2016

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Whipsaw?

I don't know.  It doesn't really matter in the big picture.

With the close of markets on 10/14 my timer system is telling me to get back into the market.  Hence, here I go:

Conservative:

F-Fund:  23%
C-Fund:  11%
I-Fund: 34%
S-Fund:  32%

Aggressive:

C-Fund:  15%
I-Fund:  45%
S-Fund:  40%

I'm going to use the Aggressive numbers, which you can see do not use the F-Fund.

Note that this will be the 2nd transfer this month so the only thing left is a move to G-Fund if conditions warrant.  I've loaded my change into TSP.GOV and since it's prior to noon EDT on Tuesday, tonight's close will be the numbers that are used in the allocation.

Regards,

Paul

Moving to Cash on October 8, 2013

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All,

Effective with the close of markets on Monday, October 8th, my master timer is indicating that we should move to cash.  I am moving 100% to the G-Fund, effective on Tuesday October 8th.

I will not know what this latest signal resulted in with respect to gains but they are modest at best.  As of tonight, since the entry signal on September 11th (enter next business day), the account is up as follows:

C-Fund:  +1.4%
S-Fund:  +1.4%
I-Fund:  +4.3%

Every little bit helps.

Due to the rolling nature of the 12-month reporting statistics at the TSP.GOV site, performance ended down about -0.5% for the month:

The differences in gain versus the drop in reported account value are partially because we've been weathering the storm overall fairly well, but as I said, I won't know the final values until close of business tomorrow.  If we have another down day on Tuesday we may break even for the series of trades, or even worse (but obviously, not THAT much worse).

Not every trade always works out to our benefit -- the key here is to live to fight another day.

Regards,

Paul

Signal change effective Wednesday, September 11

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Effective with the close of markets on 9/11/13, my TSP timing system has confirmed a move long.  I have entered the order with www.tsp.gov to move from 100% G-Fund (cash) to the following aggressive allocations:

Aggressive:

C-Fund:  18%
I-Fund:  49%
S-Fund:  33%

For those of you who would like to be less aggressive, a more conservative allocation is as follows:

Conservative:


C-Fund:  23%
F-Fund:  8%
I-Fund:  38%
S-Fund:  31%

Because my order is entered before noon ET, it will take place with the closing prices of 9/12/13.

To date the system has returned the following:

Key here is that the system gets you out of a trade relatively quickly, limiting the downside.  I took a few months off this past year so my actual blended performance is lower:

Note that this was with virtually no drawdown.

September is classically a terrible month so we'll see if this signal holds.

Regards,

Paul

Effective 5/29 - Moving to 100% G Fund

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Effective with the close of markets on 5/29, my timer system has indicated that I should move to cash.

Orders placed before noon today (5/30) will be effective tonight at the close.

New allocation:  100% G-Fund.

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

Regards,

Paul

Sell in May and Go Away? Not Now: New Long Signal

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As much as we all like to believe the rhyme "Sell in May and go away" we're not seeing those indications right now.  Of course, your crystal ball is as good as mine and it is quite possible that the rest of the month will be poor, but we must follow the signals as they are generated.

With the close of markets on Friday, May 3rd, my timer system is indicating that we should move long into equities with respect to the TSP.  Here are the allocations:

F-Fund:  +4%
C-Fund:  + 28%
I-Fund: +41%
S-Fund: +27%

The Aggressive Portfolio is coming up with some incredibly wild allocations -- I'm NOT going with this but I'll post it for your consideration:

C-Fund:  20%
I-Fund:  63%
S-Fund:  17%

The heavy allocation in I-Fund is due to a number of internal weights, and right now, the international market is firing on all cylinders.  Too much weighting in one group for me, but it *is* a diversified group and it may continue to do well going forward.

For those of you keeping score, here is the scorecard through Friday:

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

Regards,

pgd

Whipsaw -- Models move to Cash effective 4/15/13 close

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I'm on travel so I will be brief.

With the close of markets on Monday, 4/15/13, my GGT/TSP model has reversed and is indicating a move to cash.  This means a transition to the G-Fund.

If you are aggressive, a 16% allocation in the F-Fund, which is a bond fund, could be prudent.

If you are conservative, 100% allocated in the G-Fund would be the safest.

I am putting 16% in the F-Fund and 84% into the G-Fund, effective with the close of markets today (transfer made before noon EDT).

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

Regards,

pgd

Going Long on 4/11

I'm on travel so this will be brief.

My model moved long for the TSP funds.  I am going long today with the following allocations:

F-Fund:  16%
C-Fund:   39%
I-Fund:  23%
S-Fund:  22%

Changes made before noon EDT will be effective with the close.

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

Regards,

pgd

April 2 Close Confirms Move to 100% G-Fund

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With the close of markets on Tuesday, April 2nd, my models have confirmed a move to cash.  For the TSP folks, this means a 100% shift to the G-Fund.

I am already in cash, having done so prior to my departure on vacation on March 22nd.  Little was lost between March 22 and April 2nd close, with the C-Fund increasing +0.9%, the S-Fund decreasing -0.5%, and the I-Fund decreasing -0.4%.  It is entirely possible that we could whipsaw from here and move long, especially with the new earnings season starting, but my crystal ball is as good as yours so I'm sitting in cash.

Changes made to your account prior to 12 pm ET will be effective today.  Futures are mixed as I write this, shortly before the open of markets, so it is anybody's guess at what will occur today.

I will post the statistics of the latest signal later this week.  Going into the open on 4/3, without the close information for today (changes today will post tonight), here are our statistics using this system:

Use of 1x ETFs (SPY = C-Fund, EFA = I-Fund, and VXF = S-Fund), has produced the following results, again with next-day implementation of trades (e.g., use the price of the close the FOLLOWING day, not the closing prices of the day of the signal):

Note that the columns are shifted for EFA/I-Fund and VXF/S-Fund -- it's a pain in the rear for me move these around on my spreadsheet because they are linked in a relative sense to other fields throughout my timer calculations.  Note too that I am not using AGG as the proxy for the F-Fund -- I do not commit monies to AGG for my equity accounts.

Key things to compare are the Compounded Rate of Return,  Average Winning Trades, Average Losing Trades, and the ME/PRR values.  All are comparable, as you would expect.

The lesson here is that you can use the SPY, EFA, and VXF successfully to mirror the performance of your TSP funds.  If you are pleased with your TSP, this gives you another avenue with your non-TSP monies.

Regards,

pgd

Going on Travel 3/22; Moving to G-Fund

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All,

Many of you are aware of this already, but I will be out of country for the next week with limited access to the internet.  As such, and because I want to clear my mind of any investment responsibilities, I'm moving all monies to the G-Fund, effective with the close of 3/22.  This isn't to suggest that you follow - it simply means that there will be no signals or communications from me until the first week of April, so you're on your own.

See you in April.

Regards,

Paul

Entering LONG (Conservative) for Thursday, March 7th

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Effective with the close of markets on Wednesday, March 6th, my GGT TSP model has transitioned from CASH to LONG.

I am entering the markets on Thursday, March 7th using the following allocations:

F-Fund:  11%
C-Fund:  37%
I-Fund:  19%
S-Fund:  33%

This is considered a conservative stance.  If you're interested in the aggressive allocations:

C-Fund:  45%
I-Fund:  18%
S-Fund:  37%

Entering the change prior to noon EDT will make the change effective today.

Cumulative performance using this timing system is shown in the following graphic:

Of course, you are responsible for your own trades, and I am not.  Do your diligence, and take ownership for your actions.

Regards,

pgd

Confirmed Signal to Move to Cash

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In the event you did not follow me to cash last month, this should be a wake-up call for you.

Effective with the close of markets on Thursday, February 21st, my TSP timer system has confirmed a move to cash across the board in all equity accounts, with only the F-Fund remaining invested.

The following table shows the day-by-day equity values of equal-balanced investing (25% in each of the F-, C-, S-, and I-Funds).  A value above 1.0 is a positive gain, a value below is a loss:

The table shows that the F-Fund has lost about 0.6% of the equity value from the entry point in early December, while the C-, S-, and I-Funds have gained 6.7%, 10.1%, and 5.6% respectively.  Note the maximum values in these accounts were recently hit and we're down ~ -2% in the C-Fund, ~2.6% in the S-Fund, and ~ -2.2% in the I-Fund.

I would protect your gains and move everything to the G-Fund.  We may continue higher but my internal analysis shows we are slowing dramatically and most likely need a full reset of the markets before re-entry and gains are possible.  I am already in the G-Fund, having moved there in January, so for me this dialog is moot.

If you make your changes effective today before noon EDT the monies will move tonight.

Regards,

pgd

Signal Change Effective January 11, 2013

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The GGT Long-Cash Ratio (LCR), which is a measure of how many stocks in the database are outperforming their history over the past year, has hit a new local high of 4.2, meaning that 42 stocks of every 52 are firing on all cylinders (e.g., 10 are underperforming or 42:10 ratio).

This level has only been hit a few times in the past since September 2008 (when I started publishing GGT) and has lasted only 1-5 days in length before a significant drop in the markets has occurred.

Here's a graph which puts it in context:

Over 80% of the database is in some form of LONG status.  We certainly can move higher from here, but I do not think we'll go much higher before a drop occurs.  This is a terrible reward:risk ratio.

Since the long call in this account at the start of December we have moved up +4.3% in the C-Fund (tracks S&P500), +7.1% in the S-Fund (tracks the market ex-S&P500), and +5.9% in the I-Fund (tracks the EAFE index).  The F-Fund, which is a bond fund, has lost -0.4%.  Using the aggressive portfolio allocation values of December 3rd this is a total gain of  4.4% on this signal.

Today (Friday) is Day 2.  Monday will be Day 3, and I'm traveling.  Given the restrictions of this retirement account (2 trades per month) and the overbought nature of the markets, in combination with the extraordinarily high level of the % longs in the database and the ticking time bomb that has occurred when we hit these levels, I am moving 100% to G-Fund (Cash), effective with the close of markets on Friday, January 11th.  I may leave some money on the table, but in general, it is not worth the risk at this point.  I could easily lose 4% in a day or two, wiping out the work of the past 6 weeks.

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

Regards,

pgd