Thread: Last Month's Best Fund Method Strategy

Originally Posted by James48843

I suckered myself into thinking the S fund was good, so I'm personally a bit bloody right now. I have GOT to get myself some LMBF discipline!

We all need some discipline, or a stock market history book from the year 2100

Thanks, I was starting to sweat a little when I couldn't find the right total, thanks for that. I am relieved to see that we stay in the same fund this month, it's the first time I have been on time!

Unless there is a very strange day on the Street today, it looks like the LMBF method will move to the I-fund. Does anyone out there have any data on I-fund returns for the months after which it is the monthly leader? I'm just curious as to how often the I-fund has been the best fund two months consecutively. I'm betting not often.

From Nov 2001 through Dec 2010, three times, based on a spread sheet I downloaded from elsewhere in this thread. For the same time period, the C fund did not have a single double month lead! The S fund had 6 months with consecutive leads, three of which were three month duration!

Hmmm. I was following this method the start of this year based on historical returns, but now I'm not so sure. I ditched the system two days ago and got back in early, but I diversified between C, S, and I.

I just added the numbers from 2011 and the I fund added one more double leader month and the S fund added one more double leader month. Overall numbers for the system still holding out well. For the 17 year period ending 12/31/11, total cummulative returns are as follows:
G 83.79%
F 118.30%
C 172.17%
LMBF 193.61%

Note, S and I 10 year cummulative:
S 96.26%
I 77.09%

Average annual returns for the period ending 12/31/2011 (17 yrs G, F, C, 10 yrs S and I):
G 4.93%
F 6.96%
C 10.13%
S 9.63%
I 7.71%
LMBF 11.39%

LMBF still beating any buy and hold strategy.

Thanks for doing the legwork, Tomcat!

It makes sense that C would not lead in consecutive months, because if it leads going into a rally in the next month, more than likely the S or I fund would overtake it. If it leads going into a slump in the next month, usually F or G would replace it.

I don't faithfully follow LMBF, but if I did, I would tweak it so that any month that a stock fund leads would give a "buy S" signal. Any month that a non-stock fund leads would give a "buy F" signal. More agressive that way, I think. Of course, that would mean more risk.

hey guys....new here and looking to follow this strategy.....since the 1st is on a Sunday, do I IFT today in what I'm assuming to be the I fund? or wait until Monday? Thanks

Welcome smallz. Monday. I believe the system waits until the end of the final trading day of the month to officially determine the best fund and which fund to be in the next month. So the system is always in the new fund from the 2nd trading day of the month until the last, with the IFT being done on the first trading day.

hey thanks.....so IFT on Monday in order for it to start Tuesday (2nd trading day)?

i've been pretty lazy with my TSP......been in the civil service for almost 3 years and have been contributing 10% with the additional 5% matching, majority in the G fund with small % in the others. Looking to try and be a little more aggresive now. LMBF seems to have a legit tracking record I can deal with but understand the risk.

Originally Posted by smallzjohnson

hey thanks.....so IFT on Monday in order for it to start Tuesday (2nd trading day)?

i've been pretty lazy with my TSP......been in the civil service for almost 3 years and have been contributing 10% with the additional 5% matching, majority in the G fund with small % in the others. Looking to try and be a little more aggresive now. LMBF seems to have a legit tracking record I can deal with but understand the risk.

You caught on quicker than I did. Best of luck to you.

You got it. It seems like a nice proactive system that doesn't require too much effort. It sure beats doing nothing like most people. Good luck!