Thread: Market Talk

Coolhand stumbled on this article...

http://traders-talk.com/mb2/index.php?showtopic=37558

folks are more and more bearish every day and that is a good thing.

do not believe a major crash has occured "under bearish sentiment" ...the big downdrafts in the market have come from times of "over exuberant optimism".

Strategy Considerations

I have two questions. One concerns trading strategy, the 2nd is a math question. The strategy question concerns our TSP limited equity funds.

Please feel free to post comments, I'm sure others are interested!

1. Sucessful trading depends on:
a. The key is to buy when the market signals the start of a bull trend.
b. Select leading stocks that are outperforming the market.
c. Sell when the bull trend has ended, and
d. There are exceptions to this rule: Sell individual stocks if they move against the trend.
As of the end of June the 3 TSP equity funds performed (for the month):
C=+0.02, S=+0.49, and I=+0.28. The best performing equity TSP has for the last 30 days is the S-fund. The question is, if we don't have mid-caps to diversify with, or the other funds are not performing. Why not stay with the leader, the S-fund (when considering an advancing market)??

2. Question 2 is for an expert math member, and general information. The folks at ST are saying that credit interest for funds not invested, but in there account are at
1 1/4% for 30 days. What would this figure out annually??

Rgds :? Spaf

teknobucks wrote:

folks are more and more bearish every day and that is a good thing.

It depends strongly on who is bearish. But it is true, both dumb and smart money bearish % went up. Interestingly, TSP Talk bears went down so far, however.

Latest readings:

Dumb money: 46% bullish, 29% bearish

Smart money: 32% bullish, 50% bearish

TSP Talk members: 41% bullish, 31% bearish (not completed yet).

The Kingdom of TSP July 3, 2005

Insert fault. Couldn't edit Insert, sorry for the loss of the file! Reinserted!

[Tom! Pls delete prior blank pic, when U can. Tks! :? Spaf]

1 1/4% for 30 days? Is that APR? You might want to email them about that.

If they actually paid you 1 1/4% each month, that'd work out to a healthy return for the year. :shock:

http://tinyurl.com/aml2l

http://stockwerld.com/supportandres.htm

http://www.investorshub.com/boards/r...age_id=6868049

Just take out your calculator and multiply 1.0125 times itself, twelve times. You'll get a number around 1.17 which says 17% on the year. This is on the order of what your credit card charges you. I'm with you, Mike; it is in error, obviously.

Spaf, I note you distinguish between "trading" and "investing." Since we cannot know in advance which of the funds isgoing to be the leader, I would say that successful investing requires diversification among all the funds. That way you always have some $$ in the leader, whichever it might be.

Dave

DaveM,

I think I may know (guess) which fund will be the leader over the next couple of years. Growth has been the worst-performing equity style for five and a half years. As a contrarian post bubble 2000, my play is that large cap growth could have a few good years ahead. I think a change in strategy may transition to the C fund from the currently popular S fund, just when everyone has noticed how well it has been doing. If you look at some of the small cap graphs to include the Wilshire 4500 - there is a slight sense they are beginning to roll over - may only be temporary but my bet is on the C fund into the future.

After having invested in both these funds - primarily the C fund for many years - I believe the S fund has had its day in the sun and will eventually hit the invisible wall and give up outperformance to the C fund again. The S fund has had a nice run since 2001 when it became available - a good run in 2003 also and managed to tack on $1.12 in a 2 month period of time this year. I look for the C fund to take over the lead position. Gains such as 37% in 1995, 23% in 1996, 34% in 1997, 28% in 1998, and 2003 was also good. This is what I want to see repeated for the C fund going forward, therefore I'm 100% leveraged to the C fund. From 1194 to 1700 would be a nice bull phase for the sp500 and would give me a price of greater than $15.00 I would anticipate. That's when I plan to start stepping out gradually into the G fund. Wait on the next recession and start the process over. That'll be the time to get back into the S fund again. Time is the critical issue in dealing with these particular funds. You have to ride the cycles - covering the bases is one strategy - loading up on the potential winner is another strategy. I sure would like to catch and play the next 900 point banger - gotta keep them pistols oiled just in case.

I forgot to mention George will be 59 on 7/6/05. May he have another 40 good years. Do ya'll think he'd let Laura run against Hillary in 08. That would be an exciting race. Laura Bush for President - sounds terrific.

Kind of got to agree with Birch on different strategy positions. Diversification, loading up on all bases does not seem to be a rewarding strategy. I'm not talking about investing, rather position trading. Position trading strategy requires the selection of the best performing funds.

Last month C=+0.02, S=+0.49, and I=+0.28

S might falter, but thats when we change positions.

I rechecked with my broker and they do pay 1 1/4% on funds in trading cash accounts. i.e. for 100K you would get $125 a month.

Rgds Spaf