Adjusting Allocations - Nov 26 Close

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A late notice here, due mostly to the Thanksgiving weekend and my realization that this coming Monday is the start of the new month.

I have two allocation changes available here at the end of the month, and hence can make a slight tweak to the adjustment of the portfolio.  Here are the proposed allocations:

Conservative
AGG	F-Fund	7%
SPY	C-Fund	40%
EFA	I-Fund	21%
VXF	S-Fund	32%
		100%
Aggressive
SPY	C-Fund	51%
EFA	I-Fund	15%
VXF	S-Fund	34%
		100%

Since the last allocation change we've been relatively flat.  With the previous allocations, the weighted returns for the Conservative approach have been +0.3% and with the Aggressive approach the weighted returns have been +0.326%.   For the aggressive portfolio the weighted C-Fund allocation is up +0.564% and it was hit by a declining S-Fund level of -0.46%.

Note that in a mature market we typically see an underperformance of small cap stocks (S-Fund) and a growth of large cap stocks (C-Fund).

From a long-term perspective, higher allocations in the C-Fund and S-Fund are the better bet.  The table above is calculated using the next-day closing prices after I receive the signal to close a position.  Note that the table does not include allocations, e.g, it presumes 100% in each fund, which obviously is not accurate.  If you were to put 40-30-20-10 in the S-C-I-F funds (respectively) or 34-33-33 in the S-C-I funds (respectively) you would have total returns of 11.0% and 11.2% respectively, over the period September 2008 to present.

Obviously, just guidance, but you get the idea.

Changes made before 12 noon will be effective this month, changes after noon will be effective Monday.  If I missed today's change the present allocations (F/C/I/S = 9-36-9-46, Conservative or C/I/S = 40-10-50, Aggressive) are not bad at all and I could probably stay the course with minimal impact on long-term performance.

Happy Thanksgiving to my U,S. readers.

Regards,

pgd

End of October Allocation Changes, 10-30-2014

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10/31/2014 Morning Update:

I fat-fingered the S-Fund -- the correct value is in bold (51%, I had listed 59%).

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Effective with the last day of the month, I'm moving my allocations to:

C-Fund:  39%
I-Fund:  10%
S-Fund:   51%

These are aggressive values, as nothing is being held in G-Fund.  My time horizon is longer than most (11 years), so I can afford to take a bit more risk.

If you are more conservative, allocations which include holding some back in cash are:

G-Fund:  25%
C-Fund:  29%
I-Fund:  7%
S-Fund:  39%

Equally-blended in the C-, I-, and S-Funds (e.g. 33% each) produced these results since 11/25/08:

For those of you who are following my movements, I use a timing system that is applied to the numbers above.

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I have made the changes in my TSP account.  As long as the changes are posted by 12:00 pm on Friday they will apply for October and will NOT count against the 2x transfers we can use in November.

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As with all my postings, you are responsible for your own investments and I am not.  Please do your diligence, and please take ownership for your actions.

Regards,

pgd

Reversal Signal - Thurs, Oct 9 Close Update

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I entered the TSP funds with the close of markets today, only to have yesterday's signal reverse.  All indications are "back to cash".

As I indicated yesterday, the initial entry position was 50% cash, 50% equities.  I'm now there.  The reversal indicates that we should transition back to cash, BUT, if I do this, I cannot invest for the rest of the month since we only get two transfers per month.

Correspondingly, because my time frame is long, I'm sitting pat with the allocations established yesterday.  I intend to stay the course.

Of course, your actual mileage may vary.

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Standard disclaimers apply.

Regards,

pgd

New Entry Signal, Wednesday, October 8th Close

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With the close of markets on Wednesday, October 8th, we have a new buy signal for the TSP portfolio.

This is an early signal, and my cash requirements suggest that no more than 50% of the account be placed in equities.

Given this allocations for Thursday, October 9th are:

G-Fund:  50%
C-Fund:  32%
I-Fund:  12%
S-Fund:  6%

This is a conservative allocation, and it is very possible that if this run continues we could see a fully-invested amount quite soon.

This will use one of the two transfers that we have available for the month of October.

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As with all my postings, you must do your own diligence and take ownership for your own trades.  Please accept responsibility for your actions.  I have no responsibility for what YOU do with YOUR money ... this is simply what I'm doing with MY money.

Regards,

pgd

Tuesday, Sept 30 Morning Update

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No changes.

I indicated that I would look deeply at the end-of-the month signal I just received that moved me to 100% cash and that I would post whether some equity position was required.

We have 2 transfers per month available with the TSP funds.  These transfers can be however we choose, but the final transfer must be a sweep to cash (G-Fund).  It would be nice to use the available transfer (today before noon EDT) and leave two transfers for October.

While I believe that we are experiencing end-of-the-month and end-of-the quarter window dressing, and that historically, the first few weeks of October are generally positive, there is nothing in my indicators that says we should move into the markets.  There is a risk/reward component to this, and when I move against my indicators, it becomes speculation, not investing.  If I moved into the equity funds today it would be pure speculation.

I'm sitting 100% in the G-fund, and will end the quarter this way.  The next signal to move into the equity funds could be tomorrow (October 1) or it could be much, much later.  Your crystal ball is as good as mine.  Invest in the markets that are presented to you, not the one that you want.

Regards,

pgd

Moving to 100% G-Fund, Thurs, Sep 25th Update

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Effective with the close of markets on Thursday, September 25th, my indicators are showing that I need to move to 100% cash.

I am moving all TSP monies to the G-Fund, effective with the close on Friday, 9/26.

I will use the weekend to evaluate if we need to use our 2nd transfer to some form of equity balance -- right now, the answer is cash.

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As with all my ramblings, you are responsible for your own trading/investing decisions and I am not.  Please do your own diligence, and please take ownership for your actions.

Regards,

pgd

Signal Change with 8/13 Close

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Pushed for time today so this will be brief.

With the close of markets on Wednesday, 8/13, the TSP allocation has signaled a change to LONG.

The signals are weak and mixed, but they are over the threshold and hence, I'm compelled to move long.

Here are the allocations:

Conservative
AGG	F-Fund	38%
SPY	C-Fund	27%
EFA	I-Fund	11%
VXF	S-Fund	24%
		100%
Aggressive
SPY	C-Fund	44%
EFA	I-Fund	18%
VXF	S-Fund	38%
		100%

My horizon in long-term (greater than 10 years) so I am aligning myself with the Aggressive portfolio.  Changes made in my TSP account by 12:00 ET will be effective tonight.

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Obviously, do your own diligence.  You are responsible for your investment decisions and I am not.  Please take ownership for your actions.

Regards,

pgd