Re: Last Month's Best Fund Method talk
Originally Posted by
DakotaKid
Here's a thought...
To better (or more quickly perhaps) take advantage of a trend (whether it be up or down), why not do a back test for the first of the month AND the middle of the month (taking advantage of the two trade limit that's soon to be imposed...(I hope not)). This way we would rebalance our accounts on the first of the month as well as the 15th, should a change be indicated.
DakotaKid
Just for grins and giggles I did a back test of this method tied to the 26 Friday paydays (close to the beginning and end of each month). I assumed that an IFT was performed on the Friday that is a payday affective COB that day (in hindsight, making an IFT before the weekend may not be that bright of an idea). That means you are in the market on Monday at the Friday closing price.
This method was not very good with this biweekly timeframe. The overall return for the period from Jun 2003- April 2008 was 43.58%. It did well in 2004 and 2007 beating all the funds in 2004 and all but the I in 2007, but 2005 was worst than the G fund (beat the F fund though) and 2003 and 2006 where marginal (6% and 10% respectively). This year the return is negative (0.88) which isn't bad compared to the funds, but using the monthly method has the return at positive 0.88.
Right now the biweekly (payday) method has the I fund as the last month best fund saying that as of April 4 you should be in the I fund until April 18. The monthly method has you in the F (G was 0.01% behind) fund for the month of April 2008.
Good luck.
100% I August 14 (cob 8/14). Trying it again until Oct.
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