Dave's Account Talk

[tsptalk]

Welcome Dave!

Discuss Dave's strategies andtransactions here.

[Dave M]

In order not to clutter my returns page, I'll just note here that in 1997 I borrowed a little from my account. I paid it back over four years, so from 1997 to 2000 inclusive the percent change in account value will be contaminated by these pay-backs. For instance that 29% change in value for 1999 looks great, butpart of it is due to repayments.

For this reason the numbers for 2001-2-3-4 are more representative. They show a steady 17-18-19% increase, with my contributions remainingfairly steadyat 1/3 of the total.

The dollar-value of my contributions has changed over time, and of course my G-F-C-S-I fund allocations have changed too, but the percentages remain fairly steady, don't they. Interesting.

At home I have a graph showing the account over time. Using basic curve-fitting techniques I have derived equations for three different time periods, the early middle and recent domains. Theseshow the linearchange, althoughexpressed in raw dollars sonot includedhere.To "sanitize" them, I will have to re-scale ornormalize them.

I hit The Wall in 2010 which is my planned retirement year. I extrapolated my line of best fit to that time to arrive at an estimate of the value of the account, under the present return scenario. (This compares closely with the result I get at the TSP returns calculator.) Then I constructed a "high" scenario which would intercept 2010 at a higher value, and carried it back to the present. The slope of this new line represents the returns I must get in order to achieve that "high" result.

Given the returns of the last two years, if continued, I will cross over to the "High Line" within two more years (2007), and hence exceed the "High" result by 2010.This sort of calculation shows me I am on a very good track and I should be happy with my 18%.

Dave

[Dave M]

The last two days have me trepidatious. This evening I parked it 100% in G and will wait and see for a week. I only lost a few thousand, still plenty of profit left to protect.

The market needs to settle down, or maybe just receive some good news. I don't see a great big upswing, so I won'tmissthe big opportunity. I just want to stop the bleeding for now. :)

Dave

[Dave M]

In the last seven tradingdays,the 6th through the 14th, even though the market has been kind of erratic the funds have shown a net increase. This tells me that I should not try so hard! Getting cute and going all-G in hopes of avoiding a loss cost me a few $$.

Therefore I am going back to my intended distribution for the next six months or so: 40G 30C 30S -- 60% in the market. I'll never reach my goal if I stay away.

I will do thistomorrow but it will not be acted upon until Tuesday and will probably take effect Wednesday. Then I am going to pay very little attention to the day-to-day market!

[Dave M]

I contribute 14% of my salary to the TSP at present. In April at the next -- and last -- Open Season I am going to boost that to 15%. Then I am going to wait a couple months to see how my personal economy is doing. If all is well, I am going to get into Catch-Up Contributions as I am over 50.

Counting the 15%, the5% match, and the catch-up, they alladd up to about25% of my base pay which isalso about 12% of my fund balance. (Right now my fund balance is equal to about 2 years base pay.)

My goal for the year is a 25% increase in the fund balance. I'm shooting high! That means I need a return of 13% on the total invested. The40G I intend to maintain will give about 2% (5% times 0.4 = 2%) That means the 60% in the market must do the heavy lifting.

After 12% contributions and 2% G-earnings, that leaves11% to be earned by the 60% of my fund balance which is in the market. To do this, the C and S funds will need to increase by 18% on the calandar year (18% times 0.6 = 11%).

18% is well within the range of annual increases shown by these two funds. It would be a good year for all of us if it came out that way! Half that would still be very nice.

Dave

[tsptalk]

Thanks Dave. I appreciate that you are explaining why you are doing what you are doing. It helps othersto understand the thought process of deciding onan allocation.

[Dave M]

When I went to Employee Express today, I saw I was already at 15%, waddya know. I guess I changed that a while back but it only now kicked in. So I went ahead and implemented catch-up contributions, $150 per pay period which will add up to something just shy of the $4000 annual maximum allowed.

Then I went to TSP and restored my 40-30-30allocations. So I am openfor business tomorrow!

Dave

[Skip]

Dave a better ideal with the catchup money might be to open a roth account ?

I just belive I will be in a higher tax bracket when I retire,and would like that extra roth tax free money .... Ask a FPlaner in your local area for advice....You might want to invest some of the extra $$$$ in realestate...

JMHO

Skip

[Dave M]

Thanks for reading, Skip. You must have a real bundle in the TSP if you think you will have more income after you retire than now!

My calculation goes something like this. I take the basic FERS annuity, years of service times estimated high three;add to it 5% of my projected TSP balance -- an amount which oughtto be about equal to the fund's earnings and which would therefore leave the principle intact; and then take a wag at what SS will be. (SS is only partly taxable, remember.) These add up to about 80% of my current base pay.

On this basis I should still be in the samemarginal bracketwhere I am at present. The assumption is that the tax code remains essentially unaltered, and who knows about that? Anything is possible! SoI am content to defer the taxes today -- take the sure thing -- and meanwhile work as hard as I can at increasing my fund balance which is my only real means of affecting that 80% figure.

I am currently invested in real estate here in the Keys, which is unlike any market I have ever heard of. My home tripled in value withinfive years of buying it. For every thousand I pay in I get two thousand back; I feel like I am making deposits in a saving account,not making mortgage payments! But I am reluctant to figure it as an asset in my retirement economy. In the end, I think an equity line of credit maybe the easiest way to get my hands on some of that dough, heh.

Dave

[pyriel]

Hi Dave, Do you mind if I ask you what kind of real estate investment do you have. I just want to network with people that are doing the same thing that I am doing...

Pyriel

[Dave M]

Hi Mr P. As I implied with "mortgage payments" etc, my investment is my home.

I have lived in KW just about six years. When I moved herethe max loan amount for which I was qualifiedenabled me to purchase a small town home in a 4-plex. Six years later my income is up about 50% but the max loan amount for which I would qualify today would cover only about 50% of the market price of my own home. Get it?

In other words I caught the wave at just the last possibletime. New guys in our office are priced out, so they must rent. It's a problem.

If you can get up the down, I would recommend investing in a second home here, a condo perhaps. Taxes are low but insurance is high. Rent it and it will practically sustain itself, then it will be there for you when you want it. Hell, there are lots of people heremakingtheir livingflipping real estate. Buy -- rent it out for a year -- sell and make 25%. It is a full time job though, and I have a full time job of course. (My own feeling is I have the best job in KW: weather forecaster.)

There are two options as I see it. I can sell, make a nice capital gain, then move somewhere else where housing is more affordable. ("Back home") Or I can stay here in paradise but in that case how do I make good on a gain which exists only on paper?

Dave

[Dave M]

There is another way to increasethe 80% figure I mentioned above but it means working two more years. I will qualify for immediate retirement in 2010 when I reach age 60. If I wait until age 62 then I will have the two additional years of service, a 7% increase; the multiplier goes up from 1.0% to 1.1%; my high three will advance 5-7%;and I will have had two more years for growth in the TSP. That all adds up to about a 25% increase inmy projected bottom line and will makeit not 80% of my current pay but 80% of my then-current pay, up in2012.

I will have to wait and see on that. Twoyears is a heavy burden but they will be my most remunerative years by far. It will be a difficult choice. To make it easier I'm shoveling as much money into the future as I can, into the TSP. If I have a million bucks, I'm outta here!

Dave

[Dave M]

A million bucks, that'll be the day. Not in this market.

But I just went to the TSP site and looked at share prices back as far as their display would go. In June '03 all funds had prices about equal at $10. So you look at their prices today 20 months later and you can see immediately their relative performance. In the short term some go up, some go down; but over time they are all up. Even the F fund is finally showing signs of life.

This really emphasises the benefit of a balanced allocation across all the funds. Okay, not so much the F fund maybe.

So today I am allocating a hypothetical 40 grand as follows: 25I 25S 25C for 75%, and then splitting the other 25% into 13G 12F.

Share prices are 10.74G 10.46F 12.83C 14.47S 15.65I. I have 10,000 in each account except 5,000 each in G and F.

I will come back in a week and see how it looks. Right now I am 100G, watching and waiting.

Dave

[Dave M]

Here is my calculation.

At close today prices were 10.76G 10.42F 12.86C 14.52S 15.85I. Forty thousandinvested as follows gives returns:

An allocation of 100G returned $74.48.

An allocation spread evenly across the fundsreturned $175.91 thanks mostly to the I.

The message is pretty clear. It is time for me to get back to my game plan for the year. Sometime before noon today I plan onallocating 40G 20C 20S 20I, unless the numbers are strongly down at that time, in which case I will await developments.

Dave

[Dave M]

Yesterday worked out very well. Finally I made a move in the correct direction! That 1% gain puts me back even for the quarter thus far, right where I started on Jan 1. It also gives me confidence and now I feel I can cease to check stocks every day. I'll check back in next Saturday. Good luck everyone.

Dave

[Dave M]

As I am 40G 20C 20S 20I, I am evenly invested across the three funds. That means I can use the sum of the three indices C+S+I as my own index. When I bought on Mar 2 the sum stood at 43.39

It has been a wild week. At close today I stood at 43.33, down .06. But the G-fund went up a penny which is worth .02 because of the weighting. So I am down a net .04 which is about 1 part in 1000 of the index.

It is going to be very difficult to show much growth this quarter. The market seems fixated on oil -- when oil rises equities fall. Yet it seems to me that after a while we'll all get used to more expensive oil and gasoline, and move on from there. (It has been well above $2.00 on this island for months.)

So I intend to stay the course for another week. Good luck everybody!

Dave

[tsptalk]

Dave M wrote:
The market seems fixated on oil -- when oil rises equities fall. Yet it seems to me that after a while we'll all get used to more expensive oil and gasoline, and move on from there. (It has been well above $2.00 on this island for months. )
I hear the ExxonMobile CEO saidthat the only reason oilis$55 a barrel is because of speculation. The "analysts" who are saying buy oil stocks because it is going to $80 a barrel are probably the same ones who told us to buy Amazon and Yahoo! for $400 a share in 2000.

[CFenton1982]

Hello Dave M!

Thanks for the insite on your allocations over the years when it comes to the TSP. I've only been in this since July of 04' and I must say that I've learned quit a bit from this site itself. I seperate from the military in a few months and I think that I'll have to roll my TSP funds into something (probably my Roth IRA for 06).

Here is a great book by an author whom has studied IRA's for over 20 years and from what I have heard is the best around. Check it out at your local Barnes & Noble.

"Parlay your IRA into Family Fortune"

Good Luck,

Charlie

[Cinderella]

CFenton1982 wrote:
Hello Dave M!

Thanks for the insite on your allocations over the years when it comes to the TSP. I've only been in this since July of 04' and I must say that I've learned quit a bit from this site itself. I seperate from the military in a few months and I think that I'll have to roll my TSP funds into something (probably my Roth IRA for 06).

Here is a great book by an author whom has studied IRA's for over 20 years and from what I have heard is the best around. Check it out at your local Barnes & Noble.

"Parlay your IRA into Family Fortune"

Good Luck,

Charlie



Sorry Charlie, I don't think that you can transfer your TSP funds directly into a Roth.

[Dave M]

A Roth, no, because itis tax-paid and the other is tax-deferred. In my case it is a traditional IRA.

I am toying with the following: maintaining my overall market committmentbut adjusting from time to time the individual fund allocations in favor of the best performer at the time. Since Mar 2nd the I fund is up slightly while the others are down slightly. So why notchange from 40G 20C 20S 20I to 40G 15C 15S 30I.

I will look in Monday morning, If the S&P is up a bunch I will let it ride. If another fall is in progress, I will switch. If it is neutral, I will shrug, wait. I'lllet Fate decide.

Dave

[Dave M]

As the noon trading deadline approaches, the indices are up. Therefore I will let it ride.Being evenly distributed across the funds I am in position to benefit whichever way the market -- or the dollar -- bounces.

Dave

[Dave M]

I have made no changes and remain 40G 20C 20S 20I. For one thing I am on night shift this week and it is inconvenient for me to hang around untilthe noon trading deadline.For another I have no clear idea thatthe current weakness in the market is going to continue.

My index has dropped over 80basis points in the last ten trading days. I boughton the 2nd at 4339; it climbed to 4387 and was4304 at close Wednesday. (I have discarded the decimal point.) Every changeof 45 points equates to a gain or loss of $1000 for me so I am not happy at this time.:(

I shall hang in there and hope for good news to finish off the week. There is a lot of $$ out there looking for a home and eventually investorstired of being put off by high oil prices will re-enter the market which will be good for everybody. Good Luck to all Irish men and women!

Dave

[Dave M]

And so we end the week at 4293 down 41. We absorbed thebad oil news and are still standing but I think we can safely say, this quarter is shot growth-wise.It would be nice to stop the slide and reverse the trend beforethe end of the month, give us some momentum going into the 2nd quarter. Good luck, see you next Friday.

Dave

[Dave M]

The slide continues. Add the three stock funds together and discard the decimal point, the index stands at 4212 at close today, down 81 points for the week and 127 for the month,3%. This is 4% off the month's high, 4387achieved on the 7th.

On Jan 1 the index stood at 4272 so now we are eating into those wonderful gains we had in December. Some years are like this, I know, but I had such high hopes! I don't have 20 years to look forward to, so I feel I have to protect myself, and I will be staying in the G-fund for a while it looks like. Good luck everybody.

Dave

[Dave M]

Another down week, with the 3-fund index closing at 4214 on Friday, off by 5 points from the previous week'sclose. (I think I added wrong last week, or they amended one of the numbers while I wasn't looking.) Okay, so that is essentially unchanged which is an improvement I guess. However it was a volatile week, wasn't it. It opened Monday morning at 4219, sank to 4186 and then recovered to 4234 on the 31st before losing another 20 points on the lastday of the week.

What drove it down in the end would seem to be the grim forecast of high oil prices put out by somebody or another, and a poor showing in job-creation numbers for themonth just ended:Jitters, essentially. Yet as we have seen for a long time now, oil and stocks are negatively correlated, strongly.

So it looks to me as though we are going to require some time to get over the jitters and realize there is NOT going to be a crash and burn here in the West, and for portfolio managers -- the Big Boys with the billions -- to feel the pressure for positive results. For this reason I am not sanguine about the 2nd quarter, and look to the latter part of the year, maybe 4th quarter, for gains. (Last year I had almost all my gains in the 4th quarter, according to my TSP statements.)

Thus I remain 100G and will do so until this thing turns around. Patience pays. Good luck everybody.

Dave

[Dave M]

We closed on Friday the 1st at 4214. We closed today Friday the 8th at 4241 for a net gain of 27 basis points for the week. This is the first up-week in a month -- a very good sign!

But, we were down 25 points today from Thurday's close -- a bad sign. We lost in one day half of what it took all week to gain. This is sufficient deterrent for me, I will remain 100G for another week and see what happens. The market has not lost its jitters evidently.

On March 22nd we stood at 4238, very close to today's 4241. So we can say that this week clawed its way back to where we were two weeks ago, erasing those intervening losses.But where are the gains? I wanna see some actual gains before I take another plunge. Since the first of the year I have suffered losses which are just offset by my contributions so I am right where I was on Jan 1in terms of Net Asset Value, which is what I track.

I'll just say that when I was trading my IRA actively, back in the 80's, my broker and I took the stance that we were not interested in wringing every possible penny out of the market. When we had enough, we sold and left to others any further gains. That is coming back to me, now. I am content to ride thebroad movements, and I leave it to others to wring each penny out of these swings.

So if we have another good week, gain some momentum and get back another 50 points in the all-funds index, I maybuy back in. Good luck!

Dave

[pyriel]

Dave, I like that philisophy. I've been meaning to go long term but I am always getting sucker to analyze the market and move my funds. I'll rethink my strategy and look for a longer term with my TSP...

[Dave M]

It was not a good week, was it. In fact we have erased all the gains since lastyear and then some. Last Friday's close was 4241 and we closed today at 4108 for a loss of 133 basis points, 3% from where we stood.

Our1st quarter statements are available at TSP.gov. Personallyit was a disaster. Every move I made was 180 degrees out of phase except when Iretreated to the G-fund in March. My loss for the quarter wiped outhalf of mygain for2004. Fortunately my contributions made up for it and NAV is hanging in there unchanged.

Good luck in the coming week.

Dave

[Dave M]

Hey, what a week, eh? These 200-point days are are kind of nerve-wracking. Up, down, up, down, kind of like Cowboy riding a bucking bronco! (I avoid the word "bull.") That cartoon of the bear riding the bull is appropriate.

For the week the all-funds index closed up 39 basis points at 4147. In the last eight weeks we have had three up and five down and are now 192 points below where we were on March 2nd (4339). This is not a buy signal tome. Thissignals continued market jitters. Every day it is a new world, seemingly. One day inflation fears cause a big drop, next day inflation is "under control" and we rally. One day techs report a drop in earnings, next day techs lead the rally. It reminds me of somebodywho has hadtoo much caffeine! All I can see to do is watch and wait. To those of you fully invested, I can only admire your fortitude and wish you Good Luck!

Dave

[Dave M]

The bleeding continues. The close today was 4122 C+S+I, for a loss of 25 basis points for theweek. BUT...

If you got in and out on Monday and Friday, you could've gained a couple percent because these two days were up. Something told me on Thursday that the week's losses were extreme and there would be buying on Friday. So I moved 10% of my balance into the C fund and gained a percent on it. Before noon on Friday I snatchedit right back out, so I will start next week 100G again -- got a penny coming.

I had almost 16k on the line and made a couplehundred onmy gamble. It isn't much but it made up about 6% of the losses I sustained in the 1st quarter. In addition, that 1.2% gain on 10% of my balance will just about equal the $.01 coming this week in the G-fund, so I doubled the net return there. Do thisa few more times and I'll be getting somewhere. *smile*

Dave

[Dogdaddy]

The G-Fund paid the penney today..never can tell when it'll be the 5th or 6th day, but I'll take it! Other Funds are much too scarey for me right now.........

[Dave M]

Today worked out very well. Together with last week I have cut an eighth off my accumulated Q1 deficit. At noon I pulled my chips off the table in anticipation of profit-taking Thursday and Friday. I got mine; if there's more to be made, y'all can make it while I observe and ponder.

The best news is that twice in a row I have made the right move. This is a big change from previous happenings! From January to March, every time I put up they took some away. Then when I ducked to the sidelines, I missed the few opportunities there were.

This is a different style of investing for me, which by nature I am a buy-and-holder. In fact I can't really call this investing, can I? It is more like playing Wheel of Fortune -- take a spin! But the market has been so choppy lately, holding is certain curtains. Rather I have to discern when an up-day, a rare and precious up-day, is going to occur and then get on it 24 hours in advance. The real difficulty is that I cannot afford any more losses so I have to be cautious. Once I have recovered those remaining seven eighths, and have some actual profits, maybe I will get more aggressive. Good luck!

Dave

[Spaf]

Dave M wrote:

This is a different style of investing for me, which by nature I am a buy-and-holder. In fact I can't really call this investing, can I? It is more like playing Wheel of Fortune -- take a spin! But the market has been so choppy lately, holding is certain curtains. Rather I have to discern when an up-day, a rare and precious up-day, is going to occur and then get on it 24 hours in advance.
Dave

Every once and a while I look in the Tech tools and ponder something. Try this one:

http://www.incrediblecharts.com/technical/slow_stochastic.htm

Let me know what U thunk!

Rgds! :) Spaf

PS: It's on the performance charts at Yahoo, so it's easy to activate!

[Dave M]

P, the stochastic oscillator on the linked page compares today's -- or recent -- close to a past close. Looking at the computation, you can see that if today's close is the highest high of the period, %K will go to 100. If today's close is the lowest low of the period, %K = 0.This quotient will vary daily but always describes the market's movement in a consistant manner, a number between 0 and 100. The consistency is the advantage, I think. By constructing a moving average the variation is smoothed. Since we have a 12-24 hour turnaround in TSP, an integral multiple of thatwould be a natural time frame for averaging, for us.

Iwas thinking of something else. If I have a collection of points on a graph, I can fit a curve to them. The curve may not go through any of the individual points, but instead will minimize the total distance of all the points from the curve. Call this the line of best fit. Using the spread of the points, I can construct a bell-shaped curve that gives the probability thata point will liewithin a certain distance from the line of best fit.The probilities define our risk tolerance.

The curve of best fit does not have to be a straight line -- a 1st-order polynomial. 2nd-order or 3rd-order would be better because that way you get inflection points. 3rd-order curve-fitting is called cubic splines. Here is a link.

http://mathworld.wolfram.com/CubicSpline.html

Dave

P.S. This is what happens to a man when he becomes a meteorologist. And see my post above Dec 30th where I fit a straight line to my balance.

[Dave M]

This week appears to have sustained a turn-around. We closed today at 4197, up 75 from last Friday's close of 4122. (C+S+I times 100)

It marks the best week since I began keeping track in early March. Inthe last three weeks, two have been up. Of the last five weeks, three have been up. Over the last five weeks starting April 1st, we are down just 22 points, mostly due to one terrible week ending April 15th where we lost 133 points.

We have a long way to go, a lot of ground to make up. However it does look like the market is making an effort to recoup past losses and re-enter positive territory for the year. (4272 is where we stood on Jan 3rd; take away the week of April 15th and we are at 4330. The high for the year was 4387 on Mar 7th.)

We have cause for optimism. Good luck everybody.

Dave

[Dave M]

I put in 10% today, in effect for tomorrow, with the intention of staying in for a while, a couple weeks maybe. I think our G fund will give us a penny today, woo-hoo!If the trade-balance figures to be released mid-week don't tank us, I may increase my percentage. Ilooked, but saw no 'bad news' out there today, so what the heck. I still have losses to recoup.

Dave

[The_Technician]

G'morn Dave....I see you do some curve fitting.....

Have you tried anything higher than 3rd degree polynomials.....do you know about coefficient of determinations???

interesting data from such animals....it could tell you alot about the future....

The Technician

[Dave M]

Curve fitting is a delight to the technically-minded such as I. You start with a collection of points and end with convenient mathematical description. Polynomials are especiallyconvenient because they are so easy to differentiate and integrate. Third order polynomials are especially useful because -- as you remember from 9th grade algebra -- they have three zeroes. That means they will have two inflection points and can approximate a sine curve.

In meteorology we are confronted with cyclical datasets all the time. What is sometimes useful is what is called Fourier Analysis, named after a Frenchman. Here you fit a curve to the data that is not a polynomial but a mix of sine and cosine functions, something like this expression: Y= (a)sin(b)X + (c)cos(d)X + higher orders, sin squared of X squared, cos squared of X squared, etc. You come out with a waveform. In this way periodicities are revealed that might not be apparent at the start.

For example, say you are looking at daily rainfall totals at a station in in the mid-latitudes. There will be a fundamental period of one year as the summer rains give way to winter snows and then back again. Then there might be a 3-5 day period superposed on this which represents the passage of fronts and changes of airmasses. On top of it all might be a longer-term secular variation representing droughts, or maybe your reporting station has gotten urbanized as a city grew up around it, that sort of thing.

The advantage is that it gives you clues as to what to look for, physically. In itself it explains nothing. In fact, for the statistical methods to be valid you must start with the idea that the data points are independant of one another and that there is no inter-correlation. Then you reject this hypothesis at various levels of confidence. From there you investigate plausible physical mechanisms.

I am no expert on this stuff, I just know it's out there. When I read a paper which uses the techniques, I nod my head going, "Yep, yep, I recognize that, uh-huh..." I did my thesis on cloud seeding and used multiple linear/log-linear regression techniques to fit curves to historical datasets enabling me to predict what the rainfall would be in the target area based on nearby control areas. Then I compared the totals achieved during the project to what was expected based on the upwind controls.The deviation gauged the project's effectiveness, canyadigit? Stratification of the variables revealed "windows of opportunity" that existed. (That was in the 70's, which seem like the dark ages now.)

So what we need are true experts with knowledge of more modern computer methods and access to great gobs of data. It's fun stuff if you're into it. Thanks for reading, hope I've stimulated your thinking.

Dave

[The_Technician]

Well Dave, you seem to have some background in math....

Actually, if you take differential equations, and control system theory you could learn how to apply all those poles and zeros to "read" systems such as weather.....economics (which Greenspud is using), social interaction....electronic circuits, auto suspension systems.....they all are described in mathmatical models.....each pole and zero factor is a component and how it affects the system output....plus some constant =0. They are used to control output out of the system from the inputs.....

Take this for instance...

y = 5E-17x6 - 1E-11x5 + 1E-06x4 - 0.061x3 + 1742.3x2 - 3E+07x + 2E+11 is a sixth degree polynomial...it currently describes the S&P for some years back.....with approx 90% accuracy.....its trending down in the future.....you see the various power factors plus the constant = some value in the y direction....3rd degree poly's are not the only animal you can use.....generally the higher degree, the more accurate the description of the item you are describing.

I'm not really sure about the degree polynomial Greenspud is using, but I imagine it's 6 or 7 degree or maybe higher....it's called active economics (to control an active system -control system theory).....remember Reagan Financial advisor....that got canned later for his voodoo economics......I think he is responsible for getting it started......Greenspud I'm sure is using GDP, inflation, deficit and other factors in the equation to control our economy.....beats the way Jimmy Carter and those before him did it!!!

Thought you would like to know....

The Technician:dude:

[Dave M]

That's it, Tech. See, I knew someone was out there doing it, it is such an obvious idea. To gain access to the results we would need to be familiar with the literature, conference papers, abstracts, etc. It's a lot of work.

The trouble with high-order poly's is that they are well-behaved only within the original domain. They come in from infinity, oscillate about their zeroes, then zoom off to inifinity again. Typically the domain of interest is where they are oscillating. Outside that, they bomb.This is avoided by splines, which are piecewise continuous and fit smoothly together. But again, they only describe what we know, the historical period, and must be used with caution outside the domain, i.e., as a forecast tool.

Yes, math is (was) sort of behind all my studies. In meteorology we try to solve simultaneously a system of non-linear 2nd-order partial-differential equations derived from Newton's laws, laws of thermodynamics, ideal gas laws, etc., in three dimensions all in a rotating reference frame. It's a mess. Only by making a wholeseries of simplifying assumptions can they be solved analytically. Otherwise you have to use numerical methods which can only be approximately correct. Inevitably, the answer is a wave of some sort. And there is the problem of the data -- garbage in, garbage out.

But in the natural sciences we have the advantage of dealing with a rational system, one subject to natural law and nothing else. No amount of wishing can change the weather. In the market that is not the case. If enough people want something to happen, it will happen, in the market. Like say today every seller became a buyer; could happen. Or if some piece of bogus news causes every buyer to become a seller, suddenly. How do you model that?

Now we're getting into the realm of psychohistory, invented by Isaac Asimov in "Foundation". What we lack is a Hari Seldon! But...maybe I am talking to him right now? What are you working on, Tech?

Dave

[The_Technician]

No Dave I'm not....H.....whoever......but I'm an electrical engineer......I have a minor in math....some math I wish I hadn't seen.....gees.....:?

But in the mid 80's I theorized you could control the economy with control system theory and differential equations.......it turns out years later (1990)in a discussion with one of my professors that the Sec of Treasury was implementing such a system.....since I understood it by my nature.....I predictedGreenspans moves while he toned down interest rates.....through the 90's...now he is looking for modest growth.....stability is key....

The thing that bothers me the most is the instability that Congress created by dropping our economy to go worldwide in an unstable manner in the later 90's (NAFTA).....just to make moneyfor a few....now we have this unstable economy..........that's what control systems is all about....controlling stable output.....pending on mixing inputs to the black box....and they screwed it up......too much tooo soon.....

We will muddle through it....but math and control systems is where economy control isat....not some whim of a Congressman.......

Heck you can even predict Iraqi civil activity for the next 50 years with it....giving certain factors to play with....like our influence, price of oil, Iraqi participation, insurgent restrictions...etc....etc....etc....you just line them up based on the most influence...and adjust equationsssssss......

:dude:

[Dave M]

Tech, I had a little trouble with your notation but I think I see more clearly now what you meant. Note the small size of the coefficients on the higher-order terms. If I was doing the Taylor's Series I would discard them by assuming X<<1. Principal Component analysis (http://www.cis.hut.fi/~jhollmen/dippa/node30.html) would reveal the improvement in R-squared resulting from retaining them, versus the reduction in the number of degrees of freedom (and consequent predictive ability). They tighten the fit but increase the chance of the curve flying off to infinity in uncontrolled fashion.

Regression analysis is fun. You can throw in anything you believe might be helpful, like the win-loss record of the Dallas Cowboys, if you want to. For example, consider

http://online.redwoods.cc.ca.us/instruct/darnold/laproj/Fall2001/Iris/lapaper.pdf

Dave

[The_Technician]

Dave,

You should try to overlay the different curves......some give you more sensitivity, while others give you steady direction.....works real well.....its not so important as to the R squared (since you have some general idea) as it is to the current direction trend.....

Of course you also must know where the curve you are analyzing comes from......for that data tells you alot about the future....say like interest rates, energy costs, productivity etc etc...on the S&P curve...

Its all very interesting....but the weather is much harder...unless you start classifying/sorting your data like in El Nino conditions....and so forth....of course some people who have experience have seen it before and they assimilate the conditions automatically....to derive what is coming next.....sort of like a RISK computer....

:dude:

[mlk_man]

You guys might find this interesting: http://www.fool.com/news/commentary/2005/commentary05051108.htm?source=eptyholnk303100&logv isit=y&npu=y&bounce=y&bounce2=y

[Dave M]

Hey MM, I'll check it out later today.

Jusy now I put some more money on the table and went 80G 20C for tomorrow. Every week we have one good day and we haven't had one yet, so now I'm ready. Oil is down, corporate earnings are decent overall, Ford and GM are now old news -- we are ready for something.

If we do get a bounce tomorrow, I may retract this additional 10% immediately. Venturing cautiously again, heh.

Dave

[Dave M]

I went back to 90G 10C this morning, will be in effect Monday.

I think this will be my basic allocation for a while, andfrom time to time I will vary from this. I started the year 60/40 and took some hefty losses which I am still making up so I have to be careful. Tuesday's 1% drop did not help! Now today I need 1/2% just make up for that since I am 20C until the close. So a rise above ~7 points in the S&P is what we want to see today. Good luck everybody.

Dave

[Dave M]

I mis-spoke above. I started the year 40G 30C 30S, went to that in October '04. That's why I did so well in the 4th quarter, made over $10K in earnings. So I guess I am still ahead, even considering recent events...

...such as this week just ending. We closed last Friday at 4197 and closed yesterday at 4112 for a loss of 85 basis points in the C+S+I all-funds index. This means we are absolutely flat overthe last four weeks, and about where we were in late November last year. Yuck.

It seemsthis coming week will be very important for our long-term health. We have not had two down weeks in a row since 3/18 to 4/1; since then it has been one up one down, one up one down, one up one down.If this next week is down it will look on my graph like a continuation of a slide which began 3/7 and just make that trend more dominant.

Finally, this week I jumped in with 20% when I ought not to have. That erases my recent good luck. I have learned the same bitter lesson learned by all who attempt to time the market, heh. Luckily my good sense kept me at 20% and not 100% like some. (Although my20%is a pretty hefty dollar-total. I've been putting in for 20 years, remember.)

This week I am still in for 10% and still plan on staying there for a while. If this weekgets going positively, I may increase my allocation. Good luck!

Dave

[Dave M]

We had the best week in a long time, didn't we. We closed today at 4217, up 105 from last Friday's 4112 in the C+S+I all-funds index, a gain of 2.5%.

A number of things came together this week -- drop in oil, decent earnings, decent consumer and producer price indexes, stronger dollar -- maybe justpent-up demand for stocks coming from money that has been sitting on the sidelines.

I did not put in any more, rode it all with just 10% invested. Nervous Nellie I guess. Still it was a nice gain and I'll take it. Here's to another good week, good luck!

Dave

[Dave M]

Investing is once again an enjoyable pasttime. This week we closed at 4261, up 44 basis points from last Friday's close in the C+S+I all-funds index.

This makes three weeks out of the last four that have been positive, and today we stand very close to where we were on Jan3 (4272). It means thatwe have erased most of the losses for the First Quarter and are readyto resume amassing wealth.

This week I entered the market 25% and my intention is to remain invested to this extent. I placed 10% each in the C- and S-funds, and put 5% in the F-fund just for kicks. So many of us have gained little or nothing in the I-fund, I have decided to leave it strictly alone. In fact, the I-fund has been a drag on the index; I haven't calculated it but I bet the C- and S-funds combined areshowing a profit for the year.

Now what we need is for oil to remain under control, inflation to stay chilled, andproduction/consumption to hold steady. These would sustain positive sentiment all will agree. We can expect bumps and surprises, but I see little to keep us from realizing some nice gains over the next six months. Good luck everybody!

Dave

[Spaf]

Dave....Nice to hear your optimism. Them bears were getting to much! Rgds! Spaf

Dave M wrote:
Investing is once again an enjoyable pasttime. This week we closed at 4261, up 44 basis points from last Friday's close in the C+S+I all-funds index.

This makes three weeks out of the last four that have been positive, and today we stand very close to where we were on Jan3 (4272). It means thatwe have erased most of the losses for the First Quarter and are readyto resume amassing wealth.

This week I entered the market 25% and my intention is to remain invested to this extent. I placed 10% each in the C- and S-funds, and put 5% in the F-fund just for kicks. So many of us have gained little or nothing in the I-fund, I have decided to leave it strictly alone. In fact, the I-fund has been a drag on the index; I haven't calculated it but I bet the C- and S-funds combined areshowing a profit for the year.

Now what we need is for oil to remain under control, inflation to stay chilled, andproduction/consumption to hold steady. These would sustain positive sentiment all will agree. We can expect bumps and surprises, but I see little to keep us from realizing some nice gains over the next six months. Good luck everybody!

Dave
Hi Dave,
Wish I had you as an advisor during the last 4 months. I haven't been able to make up any of my losses since the beginning of January.

Question to you Dave and anyone else who would like to chime in >
Is Oil the most significant factorfor determining the performance of the I Fund as we move forward into 2005?
Thank you.... http://i3.photobucket.com/albums/y72/W_W/WW.gif

[Spaf]

Wonder Woman wrote:
Question to you Dave and anyone else who would like to chime in >
Is Oil the most significant factorfor determining the performance of the I Fund as we move forward into 2005?
Thank you.... http://i3.photobucket.com/albums/y72/W_W/WW.gif
WW...Oil/Energy has been a bad horseman for the past year. It plays on the economy like a disease! Krude is very vengeful and can rip the market apart!

[mayday]

WW The I Fund tricky little devil. I was looking at some of the history and saw that most of the time this I Fund went up after a holiday when the market was closed on Monday. Why would this happen? Gas makes me belch.

[biggdog1]

Wonder Woman, I must apologize for mayday's problem. I work with him and he really is a nice guy although it's true he is a little gassy. As far as Krude, yes I think OPEC has us by the camel hairs and it's going to go :}and:{until we take up bikes like the rest of the 3rd world.

[Dave M]

WW, I'm surprised at you. From your previous remarks I came to believe you have a substantial sum in your account. You could never have gotten there without being agressive for years.Now you seem to besaying you have mostly missedout on the rises of the last month or so (otherwise you would be healthier). Have you come todoubt yourself?

If anyone lacks aggression in their allocations, it is I. I am working hard at putting money INTO my account, maxed-out all the way including over-50 catch-up -- the total contributionwill be somewhere around $20k by year's end.I just hate it when they take that money AWAY from me.

For this reason I have been very trepidatious lately; my usual investment has been 10%, sometimes 20%. I cringe when others say "going 100% C" or whatever. The point is that even though I have taken it slow, the profits are adding up, 500 here, 150 there. Yesterday I made $5 on a 1-point rise in the F-fund, hooray! Our next quarterly statement will give us the bottom line, but as I said, I think the fiver I lost Q1 has been about recouped.

Unfortunately I am on duty this holiday and cannot participate in any Memorial Day activities, parades and cookouts and such. So here I saluteall those who serve today andhave served in the past. (A sloppy salute; I was not a very goodsoldier.) BTW, I have purchased my military time for retirement purposes, a very good investment which I recommend for you if you are eligible.

Dave

[Show-me]

Dave,

Excellent point about the buying back military time. I think it’s the first time I’ve seen it posted on this board.

The sooner you buy back you military time the better. After three year they charge interest on the balance. At least that was the case for the USPS. Simplest thing one can do if you are a new Fed employee is to figure up the number of pay periods until they start charging interest. Then divide that into what you owe for the buy back and set up a allotment. That way it doesn't hurt a new employee’s pocket to much and you can pay it back slower and interest free.

My advise is do this as quick as possible. I know of many vet’s that have 10 years, 20 years, or are ready to retire that have not started to buy back their “time�. “I’ll worry about it later.� Later comes quicker than you may think.


1% of your high-3 average pay
times
years of creditable service

Four years military time equals 4% more retirement money and in some cases a sooner retirement.

Have a good weekend!

Dave M wrote:
WW, I'm surprised at you. From your previous remarks I came to believe you have a substantial sum in your account................ Dave

Not from my remarks, Dave. A couple of peeps inappropriately, I thought, 'guesstimated' how much $$ I might have after that difficult period I had on this board. I took a lot of heat by stating how much I lost. Lessons learned: I will never do that again!

Back to my original question restated > Is oil the most significant factor in determining how the I Fund performs?
Thank you.... http://i3.photobucket.com/albums/y72/W_W/WW.gif

biggdog1 wrote:
Wonder Woman, I must apologize for mayday's problem. I work with him and he really is a nice guy although it's true he is a little gassy.......
mayday, biggdog1, Looks like we have a new set of comedians on the board. Welcome and I appreciate both your humor and your response.
Spaf, thanks to you also......... http://i3.photobucket.com/albums/y72/W_W/WW.gif

[Birchtree]

Wonder Woman,

Why do you have to ask such difficult questions? Yes it is a complex question but I will try and give you an understanding of the oil and I fund connection. There really isn't one - that was simple enough.

Please use a larger font when you post - I can hardly see what you wrote.

To the oil question in a moment - but first let me say that in my account talk I mentioned to participants I gave up $138,000 in my private account from 3/7 to 4/20 and no one has yet decided to try and put my feet to the fire. Perhaps they just feel sorry for me leaving the wounded bull alone to his own demise. But heck I'm already on the come back trail - and alot of my recent gains have been due to the price of oil increasing. The hedge funds are buying commodity stocks again. The sp500 has only a 7% position in energy - I certainly wish for .

[pyriel]

Birchtree wrote:
Please use a larger font when you post - I can hardly see what you wrote.
I agree. It is hard to read.

[Birchtree]

The problem with the I fund is not oil, but rather monetary policy from the BOJ (Bank of Japan). Remember Japan has a 21% position in the I fund - UK has 22%, and the other countries are all slowing their economic base. When we expand they will expand - they are all export type economies - but Japan remains the laggard, acting like a drag chute on a race car - slowing things down.

Japan has been in a 15 year period of economic malaise. The BOJ has been overly tight on their monetary base. Japanese housholds and businesses have a demand for cash after years of decline in land prices, a falling Nikkie and no inflation - in fact deflation - at the cosumer level. In the spring of 2001 BOJ announced their quantitative monetary policy easing program. It was all talk and very little do. It was expected that BOJ officials would alter expectations concerning the wisdom of holding cash through it's quantitative easing program by creating positive rates of inflation. They did not try hard enough - real growth in Japan remains anemic and inflation is stuck around zero. Unfortunately, it appears that expectations about the value of holding cash have not been modified. Remember our Fed went to 40 year lows of 1% to prevent deflation in this country.

[Birchtree]

BOJ today is still in the process of tightening and there is a reason for this continued action. If the BOJ ever decided to participate in the process of erflation - they would need to allow the yen to find its equilibrium level, which means allowing the yen to devalue. Here is the crux of the matter - why their growth averages 2% on a year to year basis - a tepid pace that spells intermittent periods of recession and deflation ahead. If the BOJ would expand their monetary base and buy up government debt and target a 2% to 3%, or some other positive rate of inflation they would experience growth that would help households and companies.

However a cheaper yen would mean foreign capital inflows as US and Chinese investors and businesses rush in to purchase Japanese real and financial assets. Remember in the 80s when they were here buying up everything they could. Since the Chinese currency is pegged to the dollar, both US and Chineseinvestors would be like kids in a candy store with lots of money. That has been the nub of the issue for the past 15 years. Japanese officials are afraid to straighten out their economic mess because it would mean allowing the yen to find its own level, which in turn would mean a flood of foreign monies pouring in to scoop up undervalued assets.

[Birchtree]

Japan has manned the battle stations for 15 years to minmize foreign investment inflows. Remember when one dollar could buy 270 yen in 1982? Now it can buy only around 107. Japan wants a strong yen to keep foreign investment out and seems willing to indefinitely make the trade-off of remaining in or near deflation and stifling their economic growth with inadequate money supply growth to achieve that.

Japan is the problem - not the price of oil. Japan will not adopt a monetary policy that is conducive to faster economic growth which would pull in more imports. Likewise it will not adopt a tax policy that is conducive to economic growth and more imports.

The Nikkei stock index reached a peak monthly value of 38,134 in December 1989 before declining to 7909 in March 2004 - iys 1982 level. That equity decline is a useful proxy for Japan's economic deterioration from an economic powerhouse to an economy depending on exports to the US and emerging-market economies for its growth. Again, Japans's economic growth has been anemic since 1990- averaging approximately 1.5% per year. while inflation, as measured by the CPI, has averaged about zero. The I fund will lag in performance as a result of Japan - I would only accumulate it while waiting for tomorrow.

[Birchtree]

Wonder Woman,

Show our friend DaveM that you are not trepidatious - be bodacious. Go 100% C fund and the sooner the better - you will get right. The key is the Fed and interest rates - they have paused - only they aren't saying anything. The bond vigilantes are setting policy for the Fed - they don't see inflation. Best Regards

Permabull#2

Birchtree wrote:
Wonder Woman,
Please use a larger font when you post - I can hardly see what you wrote.

To the oil question in a moment - but first let me say that in my account talk I mentioned to participants I gave up $138,000 in my private account from 3/7 to 4/20 and no one has yet decided to try and put my feet to the fire. Please use a larger font when you post - I can hardly see what you wrote. That is so strange because what I see my font is equal or larger than what I see in your post. However, I know what I am doing wrong and will adjustment. Thank you......
To the oil question in a moment - but first let me say that in my account talk I mentioned to participants I gave up $138,000 in my private account from 3/7 to 4/20 and no one has yet decided to try and put my feet to the fire.
Birchtree, you are in a class of your own - no comparisons possiblle!!
http://i3.photobucket.com/albums/y72/W_W/People/ARNOLD11.gif
Thank you for your responses. http://i3.photobucket.com/albums/y72/W_W/WW.gif

[Birchtree]

Wonder Woman,

With the TSP contributions opening up in the future for more appropriations possible - there will be many others over time in the same league. That is what makes this country so darn great - we all have opportunity presented to us, the market is a very nice equalizer. Even my cat could make money, if I wanted to get out the pistols and trade with abandon - but I'm just darn lazy. She would provide excellent advice, similar to Yogi and Chicken Little - no I mean better advice. C'mon get right on the trend and get right on the choice. You know you are and can be bodacious. Heck, even someone else I know has gone 3%C and 2%S-now that's progress. Now the renegade has arrived.

Seriously Birchtree, if I went 100% C since I began losing $$ in Jan. I would have lost 3.95%. I guess your reasoning is the future returns. I've told you before I can not risk losing more at this time! http://i3.photobucket.com/albums/y72/W_W/Smileys%20Animated/ZG_06D17.gif http://i3.photobucket.com/albums/y72/W_W/Smileys%20Animated/OH_WEL28.gif http://i3.photobucket.com/albums/y72/W_W/Smileys%20Animated/ZF_UH_230.gif http://i3.photobucket.com/albums/y72/W_W/WW.gif

http://i3.photobucket.com/albums/y72/W_W/Smileys%20Animated/Finger.gif And before you tell me how much C Fund has gained in May > http://i3.photobucket.com/albums/y72/W_W/Smileys%20Animated/I_ANGR111.gif http://i3.photobucket.com/albums/y72/W_W/Smileys%20Animated/k_crying.gif http://i3.photobucket.com/albums/y72/W_W/WW.gif

[Birchtree]

Wonder Woman,

OK, peace be still. I hope you are at least dollar cost averaging. Stay away from the I fund unless you want to dollar cost average there - the Japanese are so slow.

http://i3.photobucket.com/albums/y72/W_W/Smileys%20Bubbles/ZA_THANX1.gif http://i3.photobucket.com/albums/y72/W_W/Smileys%20Bubbles/nice_day_text.gif http://i3.photobucket.com/albums/y72/W_W/WW.gif

[Dave M]

Dave's Diner is flourishing I see.

WW I have no idea what oil will do, on its own or in relation to the I-fund.You flatter me.All I meant by my remark was, do not lose confidence.

Dave

[Spaf]

Dave please excuse me for entering your account talk. I would like to address some of Wonder Womans concerns.

Pyriel please delete this post so that it remains Dave's account talk thread. I tried to find an account talk thread for Wonder Woman, but I couldn't find one??

WW....please, if you will, start an account talk thread for your self! Or, join us over at market talk, whichever.

WW.... you can PM or e-mail me. We can get you out of that hole and set you on your way. No guarantee. But, You will feel a lot better.

Been there, done that. I am serious, I need a new boat.....on a mission!!!

Rgds, Thanks Dave! :) Spaf

Dave M wrote:
Dave's Diner is flourishing I see....... Dave
So What's for Dinner, Dave? http://i3.photobucket.com/albums/y72/W_W/Food_Beverages/WAITE203.gifhttp://i3.photobucket.com/albums/y72/W_W/Food_Beverages/VALENT54.gif http://i3.photobucket.com/albums/y72/W_W/Monkies/thMON55.gif

Spaf said we weren't suppose to be posting here. Sorry, I didn't realize that - thought 'account talk' vs. 'account' was ok. I will PM you Spaf. Thank you for your generous offer. http://i3.photobucket.com/albums/y72/W_W/WW.gif

[pyriel]

Yup, that is why we have an account talk... Spaf, are you offering your service to make us $$$? Is this going to be different than what you are posting? Can you get me in on it too? I need some $$$? Lots of it.

P.

[Show-me]

Me too, me too! I've never owned a boat!

[Dave M]

All are welcome, come on in for a cup of coffee. We need a place to go on days the market is closed -- anybody else feeling the withdrawl?Chess boards are available. Remember to tip the staff generously!

Dave

[Spaf]

I understood it to be Dave's account talk. Where we talk about good old Dave! I think I should be in another forum. What I'm telling WW is not confidential. I will share anything (well almost anything) with others. I didn't want to fill Dave's section up with "other stuff"

Let me find a more appropriate forum and I'll be back!

Spaf

Couldn't find anything specific!

Maybe Tom could make a fourm for this?

In the interim I'll go to Day to Day Market Talk: Market Trading / The Best Trader is U

Hows that? We are running!

[smedlap]

Buying back military time. well stated. What most do not understand is the longer one delays, the greater the compounding of annual interest on interest to the point where when one ends ones career, the bill is so significant that some cannot pay the bill for the credit. It is just the opposite of what we are involved in in TSP - compounding to our benefit!!!!!!!!!!!!!!!!! One cannot imagine the difference and I suggest anyone in this situation should "pay themselves first" as as fast or early as possible!

[Dave M]

Well, in my case I waited thirty years! But I had only two years service, and they paid me squat, and they compute your liability on only a fraction of your earnings, so itcost me under $600 for the two years. Cheap.

Since I plan to retire with 25 years, the two additional years work out to an increase of 27/25=1.08=8% in my basic FERS annuity.It won't take long to recoup the six hundred.

Dave

[Dave M]

Down, up, up, down, it was a short week but a volatile one. We closed on Friday at 4271, up 10 basis points from last Friday's close of 4261 in the C+S+I all-funds index.

The index represents a simple measure of how an investment spread evenly across all three funds is doing. It made a recent bottom on May 13 at 4112. That means Friday's 4271computes to a 3.8% increase in the last three weeks, (4271/4112 = 1.038), a solid performance. A close this coming Friday June 10 of 4325 will continue the trend line.

This makes three straight up-weeks, and 4 out of the last five. It means buy-and-holders now have a little headroom, and can afford to wait out the small-scale wiggles. SPAF, youridea of a stop-loss is a good one, and now we can set one that makes sense and leaves us in positive territory -- we don't have to bail at the first sign of trouble in order to preserve evanescent gains.

We're only looking for 15 basis points per week in each of the funds, average, over time. Good Luck!

Dave

P.S. I am holding 75G 5F 10C 10S, considering adding 5I to the mix.

[Dave M]

Today I addedfive points in the I-fund to the menu.I know, not a big move but who knows anything about the I-fund? To most of us it is a mystery. I'm pretty sure the fiver will do better there than in the G-fund, therefore I bought. I am now 70G 5F 10C 10S 5I. I'm everywhere!

I'm gonna make 4185 my stop-loss. Let those who feel differently, do differently.

Dave

[Dave M]

We had lots of news this week that turned out to be mixed and so there were no big moves in any direction. We closed Friday at 4284, +13 for the week. This slight uptick continues a flattening trend that began a couple weeks ago, it is now apparent.

There may not be much further profit to take if this goes on. In other words, can it hurt to take profits now? (The quarter is ending in a couple weeks, too.) And yet...because I am not certain what to do, I shall do nothing for coming week. Maybe some good news will turn up.

My adventure in the I-fund has turned out to be pretty painless so far. Combined with my small holding in the F-fund, 750 shares, I am spread across the board with 70G 5F 10C 10S 5I andI like the feeling this gives. Good Luck!

Dave

Oh, I will advance the stop loss to 4200.

[Dave M]

I did some more figuring over the weekend -- on night shift and the weather is quiet for a change, no hurricanes on the radar. I am able now more closely to estimate the change in my account during the 2nd Quarter, and I think as of today Istill show a small net loss for the year.

With two weeks to go before Q2 ends, now might bea good time to make a play. We have important news coming this week. I expect it to be mixedresulting in a mixed outcome. But it might be interpreted by the market as a whole, aspositive. Therefore I will be paying close attention on a daily basis and looking for the chance to increase my position. If I sense a big day, I might gamble!

Dave

Hope it works out for you. :)

Enjoy the down time. Read that this hurricane season could be worse then last year if historic patterns hold. :(

[Dave M]

I'm not too keen on historic data wrt hurricanes.I have a hard time believing that last year affects this year -- each season is distinct. Now, there might be a plausible physical mechanism that makes any two consecutive seasons similar. If so, I want to know that mechanism; the statistical correlation is largely irrelevant to me, down here in the trenches at the operational level.Give me something I can point to on my weather map!

But back to the market. We have had two days of modest gains based on no news (Monday) and mixed news (Tuesday). More news is coming tomorrow. Assuming it will be mixed,what are the chances of a big day Thursday or Friday?

I need to resolve that question before noon Wednesday. It sure would be nice to end Q2 with a coup!

Dave

Triple Witch Monday.

Market is heavily shorted.

When will the shorts squeeze happen to square up prior to trip witch expiration?

Short squeeze today in GM and walmart. You see what they did. I flipped went long and am short WMT again. Because I like pain too and it is real dud of a stock. What went down was the retail sales stank and people got greedy and started to square up and caused a chain reation of short covering. Lots of the hedge fund guys are still underwater for the year and if they can get .3 or .5 here they are going to take it and screw the rest of us cockroaches.

Right now it is like a gun fight we are waiting for the big guys to blink and try to kill them first.

I am chained to my level ii right now waiting.

However, with the TSP restrictions I would not want to try to time the short squeeze. That is just my HO. G fund should pay .01 tomorrow. I am thinking short squeeze will happen on Thursday......not sure since people are quietly exiting the areana now.

Hope that makes sense? This board keeps timing out on me. I wrote this three times and each time it makes less sense. :shock:

This is another poster that here that thinks the Walmart action today was heathy. :shock::shock::shock: I just told you the reality. Buyer beware.


Oh yeah if you take GM and WMT out of the Dow and S&P 500 the market was down pretty big today. He called it a good rally. :P:P:P Short squeeze, low volume bounce. Hardly any shorts on GM and WMT right now. Hmmm. What is going to happen???

[Dave M]

Okay, DMA, now say it again in English. Use subjects and predicates, speak plainly in complete sentences -- with no smiley faces.You seemed to become distracted. Or perhapsEnglish is your secondlanguage?

What should we look for Wednesday morning to tell us Thursday is going up 20+ S&P? My first thought is, if the economic news is nothing major, and the market just sort of meanders, then by Thursday the reality will set in and a climb is possible. On the other hand, if the news isgood and a big rise gets underway Wednesday morning, then it shall be too late to join in, probably.

Dave

Dave - like I stated I was getting timed out. I rewrote that three times.

I am speaking in English that is clear to me. English is not my second language, thanks for asking.

Anyway good luck. Hope ya all the best.:) I ain't taking the bait this time.

[Dave M]

I checked in at 1100 AM and saw what I did not want to see -- an overnight spike in oil prices. Thishad the usual effect on stocks and the S&Pwas down 3. Had it been up 3 I would have bought some more C&S, on the mixed but generally good economic news which came out this morning.Had it been up 10 I would have held.

Now I feel I must protect recent gains. Remember I am still making up for Q1 losses which were severe, and that has been tough in this market. Now I want to see just a smallmovement today -- up or down --then I will wait and see a while, a short while.

100G cob today.

Dave

[Dave M]

We got our small movement today. Mon-Wed totals up to about 8 points overall. Now to watch tomorrow's action, from the sidelines. If it looks safe to do so, I will buy back inFriday.

Now I am toying with the idea of buying an equal number of shares in each fund. Onethousandshares each wouldgive me 67G 7F 8C 9S 9I, roughly. With a nice even number such as 1000, it would be easy to see where I stand -- $10 for every penny change. And this allocation is right about at my risk level.

Dave

[Dave M]

We bounced right back, didn't we. I may have managed to avoid the best day of the week (today), my usual result. TodayI rebalanced to 67G 7F 8C 9S 9I.

This should work out to right around 1000 shares of each. Percentage-wise, it looks a little heavy in the I-fund, that will bear watching. Good luck everybody!

Dave

[Birchtree]

DaveM,

I'll have to figure that amount up - still looks like ample powder to light a good fuse with. Blow yourself out of that shelter - you watching the courage our guy Mlk-man is displaying. Awesome - it looks like commodities are back - another consolidation day with good A/D line. We will break one way or the other - my choice is up. The big question is when - you'll have to hustle and light that fuse. I don't mean to badger or promote - it's only I'm lonely.

Dennis

[Dave M]

What I am going to do is go through my records and see just how much money I have contributed over the years, how much is matching, and how much is growth on the whole kitty. This will show, I believe, that the portion of the total balance in my account which actually came out of my pocket, is about 1/3 of the total.

Then I am going to take that number and work up a rate such that, had my money been placed in a passbook account bearing x-percent interest, the balance would match the actual.This will show, I believe, that I am getting something like a 20% per year compounded return on my investment. The govt matchwould be accounted for in that percentage.

The point is to show just how much of my capital is my own, and hence worthy of preservation absolutely;how much of it ismatching-money, what would be called "found money" in my family, and hencepreferred for use in the riskiest investments;and finally how much of it is pure earnings, foruse in ordinary investments.

I will have a better idea of what exactly I am risking by beingin the market. I could put "my" money in the G&F-funds, govt matching money in the I-fund, and the rest in the C&S-funds.

I'll probably never do as you and MM do -- put 100% into any one fund unless it is the G-fund.

Dave

[Dave M]

This was a week to remember. Multiple batches of important news were released; the oil market was volatile;options were expiring;it was all in near-equilibriumand resulted in a smooth five-day climb. We closed at 4374 today, up 90 points from last Friday's close of 4284.

It was a very good week therefore. Unfortunately I dropped out Thursday and missed 17 of the 90 points.I only did that because of uncertainty, and the feeling that a down-day was due. Look back at Wednesday's allocation changes in the various account threads -- a lot of uswere going to the G-fund including our host, Tom. It made sense with the way the year has been, real choppy, remember?

But I lost that feeling quickly with Friday's result, up 47, half of the 90 points for the week. And the G-fund paid a penny, too! How sweet it is!

This weekend is time to ponder the YTD situation, and evaluate the question: does the market represent reality at this time? I think the stop should be brought forward to 4300 but that might be high. I stand 67G 7F 8S 9C 9I. Good Luck!

Dave

[Dave M]

Funny the way it works out -- this was a week to forget. A spike in oil to $60 upset the fine balance. In the absence of countervailing good news, or good enough news, our index slid 73 points to 4301 at theclose.

So the answer to last week's question was yes, but the reality shifted during the week which resulted ina sharply downward market reaction.We reached the stop of 4300andtoday I sold.Istill show a profit for the period starting May 26 when I boughtin, but about a third less thanon Wednesday, heh. I had fun in the I-fundand sometimes it showed large upward moves, something to keep in mind.

I will probably stay in cash until the quarter's end unlessa sea-change occurs. Many on our board think this unlikely; all we can do iswait and see. I remainoptimistic for the year butfor now I am 100G. Good luck everybody!

Dave

[Dave M]

This was a difficult week to judge in advance. The markethad important news from the Fed, volatility in oil, and other economic news to digest. The result was a narrow gain. We closed Friday at 4321, up 20 from the previous week's close of 4301. I had voted neutral in our weekly poll.

Since the final two days of last week were so dreary, on Friday the 24th I sold out to G in order to preserve the Q2 gains I had managed. Then by Monday it seemed that the F-fund was the best place to be, as it had registered the best performance of all the funds since Jan 1. So onMonday the 27th I bought a couple thousand shares at 10.70. Then on Friday the 1st with the end of the quarter I felt it was time to re-balance for Q3 and went 10F 9C 11S 3I 67G.

This is a slight change from my last 1/3-2/3rds allocation. I decreased the I-fund and increased the F- and S-funds. Note that today the S-fund is within 15 basis points of the I-fund and is looking like it will overtake it soon. Evidently small-cap companies are liking the current interest rate environment, while the dollar isdoing too well lately.

Here is my estimate of my performance in Q2 -- plus 1.5% on the total balance, afteraccounting for my cash contributions.I never had more than 1/3 of mytotal invested, so the performance on what I actually had instockswas more like 4-5%, not bad. I think that for the year I am still slightly negative.

These last six months have been enlightening for me. For the first time I took over active management of my portfolio, for which I thank you, Tom. Until now I had just let things ride. Yet I made many poor trade decisions in Q1. I can seethat I was deeply ignorant and had much to learn. I thank everybody here for helping me albeit all unkowingly, including you DMA! Myimprovement in Q2 shows that I am now better in-tune with events, but of course the market was much better wasn't it.

I have pretty much established my risk tolerance at 1/3rd. Now I have also worked out a decent mix of the funds. Diversity is best, I think. I am mostly in the two big gainers on the year, F and S, withC and Ithere to round things out. My intention is let it ride unless disaster looms. (There are plenty here who think it will, too.)

At this stage I think I will continue to pay attention daily, but post here monthly rather than weekly. Like a garden, it must be left alone to grow. You can kill it with "kindness" (= too many ill-timed trades). Good luck everybody!

Dave

[Dave M]

Thank you everybody for your expressions of sentiment. Hurricane Dennis passed about 70-80 miles to ourwest but still raked the islands. Our peak wind was 74 mph at the airport weather office wherewe had salt water on the runway. Thepower was out at my home for 24 hours -- got a chance to fire up the brand-new portable generator.I toured the city this evening and saw a few trees down, lots of limbs down, debris everywhere. She looks a little bedraggled.If this is a near-miss, I don't want to have anything to do with a direct hit.

"If we sell, the terrorists win." I am content to leave it at that.If such acts arethe result of ignorance, as has been said elsewhere, then I'm pretty sure that education would be a better antidote than further violence. On Friday I said a short prayer for London, kept my mind on my radar, and was gratified to see the market's positive response. A tax-deductible charitable contribution to the International Red Cross is brewing.

On the first of the month I put exactly 1/3 of my kitty in the market with the intention of letting it ride for a month.Today the percentage in G is down to 66.92 AND there has been another contribution, which all goes to G in my case. Therefore my gains for July sofar,have essentially doubled my rate of contribution,a useful yardstick. Think back to January; they were taking money away from us...ugh!

Good luck everybody.

Dave

[Dave M]

Q2 statements have come in. I had a nice turn around from Q1, which was a disaster for me.

I had Q2 earnings of 1.7% on mytotal balance. During the quarterI usually kept most of my $$ in the G-fund and had only10% or 20% invested in the the stock funds -- had to be careful --so my return on the amount invested was more like12%.

Over the last four quarters I have have increased my total balance by 15% with earnings comprising 5% and contributions 10%. That stinky Q1/05 is going to be a drag on the numbers for quite a while.

July is shaping up to be very profitable. Even with the headwind ofhigh oil, advances have been very regular so far. I may increase my exposure on Monday, taking what I can get whileI can get it. Currently I am 2/3G 1/3FCSI. The next step would be 1/2G 1/2FCSI; I'll have to think about it, may wait another week.

Good luck everybody.

Dave

[Dave M]

An error crept in to my calculations above. I should not count my earnings from the G-fund as part of my investment earnings, should I. That takes away 3/5ths of the total and I recomputethe Q2 earnings fromthe stock funds asabout 5% to 5.5% on the amount invested.I was having trouble figuring out how the heck I earned 12%!

At present I have all my contributions going into the G-fund. I think that rather than re-allocating more money into the stock funds, I will re-directmy contributions into the stock funds. This will enable me to increase my exposure ever so gradually:I will not have to sell in order to buy, as would be the case were I to change my existingallocationpercentages. In other words, my basis remains mostly intact this way.

The question is, how should I direct my contributions? Into which funds should they go?To start with, since I have at least some money in each fund, I incline toward25% each into FCSI. The more I think about it, the more I like that idea. Monday morning, that is what I shall do.

Dave

[Birchtree]

DaveM,

If I were the reckless type I recommend 75% C fund and 25% I fund and not look back until the end of 2006. That way you don't worry so much - leave your destiny to fate.

[Birchtree]

I wrote a response to Aslan who is 100% S fund - stating that at the end of the last 3 Fed tightenings, six months later the small-cap stocks outperformed large caps in all three cycles. The conundrum this time is that small-caps have already outperformed large cap issues for the past six years. The possibility exists that we may be approaching a distributional topping pattern for the S fund. Future gains may be limited - money can still be made - and you shouldn't lose money. Also you will notice how expensive it has gotten in relation to the C fund. If you simply must have some S fund perhaps a reversal of percentages with the I fund would be more cost effective for your dollar cost averaging goals. Any way where you are is very reasonable - certainly more offensive that your past positions. Good luck.

[Dave M]

Today I adjusted my contribution allocation to 40C 40S 20I. My balance is allocated 2/3G 1/3FCSI. What I will do is watch the share-countand see how it goes; this is quite easily adjusted without disturbing the account. (My contributions are pretty hefty as I am maxed out percentage-wise and I am kicking in max catch-up as well. In Q3 they will total about$4500 including the gov't match.)

Dave

[Dave M]

This week has me thinking I could better take advantage of our current good fortune by rebalancing.A little less G-fund, no moreF-fund, more C,S and I. The F-fund wasgood for a while but is now flat over the last 30 days.

The mix60G 16C 16S 8I would be in proportion with my contributions which go 40C-40S-20I.I expect I will do this Monday morning.

Dave

[Dave M]

BT, I'm joining you -- taking my own advice actually, and making hay while the sun shines.Now I am thinking 40G 24C 24S 12I. (In the 4th quarter of 2004 I was 40G 30C 30S and made some great money.) That would need close watching.

Dave

[Birchtree]

You are coming out to fight the Fed - DMA will call you crazy. The Technician will add his comments of caution - Birch says go for the rumble. Coolhand is saving 25G for the rescue of the pretty girl if and when she stumbles. You are in a good position to take advantage of that particular scenario. In the first year of the presidential cycle the last 5 trading days of July have been up 70% of the time. What I really need is for the Chicago PMI to remain above 50 - comes out 7/29. The pretty girl is in reference to the bodacious S fund. Never let them see you going to the bank - just kidding.

[Birchtree]

I noticed the pretty girl fell into your arms today. If she shows further signs of fainting will you provide some tenderness from your G fund reserve. You may have to experience a little rain before the sun shines again. Anyway, have FUN.

Dennis

[Dave M]

Well shejust gave me 3011 kisses and appears to be completely revived. D

[Dave M]

Slow and steady wins the race.

I have come to respect the opinion that we cannot know what the market will do in the future, but we can see what it is doing at present and what it has done in the past. For this, the charts that TSPGO prepares are very instructive.

-GO is systematic and obeys his rules always. I don't have any rules, really; I'm more intuitive than systematic. (This sometimes confounds my colleagues.) I appreciate the charts, though. They show the current price as being above the moving average, in the three stock funds.That right there is about all I need to know.

Dave

[Birchtree]

DaveM,

I'm sure you had a good day today - better one coming tomorrow. Is that extra cash burning a hole in your pocket yet? I know it's a sacrifice holding that much.

[Dave M]

If the sun shines tomorrow, I have in mindputting the other 40% to work and going 40C 40S 20I for the coming week.

I was 40G 30C 30S on Jan 3rd. Unsuccessfulmanuevers to avoid losses in the early part of this year alsomanaged to avoid gains. A back-of-the-envelope calculation shows that had I done nothing, my balance would be higher today.

Therefore I still have ground to make up and now seems a good time to do it.

Dave

[Dave M]

Here is my tally for the month of July. The index I track is the sum of the C+S+I funds but without the decimal point.

On the 1st it stood at 4321 and on the 29th it was 4495, an increase of 174 points, or 4%.For me it translated into a 1.5% increase on my total balance as I was not fully invested, and not counting my contributions for the month. This equaled myearnings for the entire 2nd quarter so I am well-pleased.

We've had a good run, starting sometime in late April or early May. It wiped out all the losses which had accrued since the 4397 high on March 7th and established new highs for the year. The message is, just hold on and the market will come back.

So I intend to remain 40G 24C 24S 12I, with contributions going 40C 40S 20I:No more trying to outwit the market by selling high and then buying low. It sounds so good but cannot be done in practice. The remaining 40% in the G-fund is two things -- it will have some earnings and act as a little insurance to counteract losses if there shouldbe a sell-off, and it stands as a reserve which I can commit later in the year.

I have to thank member TSPGO for the charts on his site. If you have not visited him, you should.

Good luck everybody.

Dave

[Dave M]

I sing the praises of diversification. At the mid-way point in August I havepositive results for the month,mainly because the I-fund has been carrying the ball lately; the C and S funds havedoggedit, especially the latter.

In Q1 this year I would have bailed at some point givensome of our recentBIG down-days. Had I done so here I would certainly have missed many of the up-days which have occurred. I am acting according to thethesis thatover the long term the upsexceedthe downs, but Imust catch them all by staying pat and staying in.

Good luck everybody.

Dave

[Birchtree]

DaveM,

I know you realize the pretty girl S fund is now$.40 lighter than two weeks ago.If I had your money - why not throw a dime her way at these lower prices? Even if it is not the exact bottom of her mini correction she sure looks to have a better valuation now at $15.64 than $16.04.

Dennis

[Dave M]

Buying 500 more shares is an idea; it would amount to just 10% of my reserve.But while it has fallen the most, the S-fundalso rose the most in the first place. It gave back a lot but not nearly all -- on July 1st I bought a bunch at $15.12so S-fund at $15.56 isn't all that attractive. On Thursday or Friday of this week I will buy $300 worth of C and S both, automatically, whatever the price.

Here's a question: How would I arrange it so that the purchase of the new S-fund shares is the only transaction, if I decide yes? Calculate the new percentages for G and S,leave C and I unchanged?

Dave

[Birchtree]

DaveM,

Exactly - you are on to something. Now what if at the end of August the pretty girl is back to $16.04 or a little higher with the general market move providing we get one.

A price of $15.64 would definitely look cheap. That dollar cost averaging sure is a great way to make buys. Thanks for the demonstration.

Dennis

[Dave M]

I made a buy today and went to 35G 26C 26S 13I. I thought it best to preserve my percentages so as to accord with my allocations which are in proportion of 2-2-1, C-S-I.

Taking pricing into account, thisrepresents an increase inshare-count of 9% in C, 9% inS and4% in I, afterincludingthe automatic bi-weekly purchase which takes place this week.G-fund wentfrom 40 to 35,a 12% decrease.

All things considered, my net asset value remainsat par over the last six weeks but my share-count has just increased, augmentingfuture profitsby a weighted mean of 7%. Me for diversification.

Dave

[Dave M]

Fishhog, welcome to TSPtalk. Let's not clutter the other thread with talk; after a while, you will learn the set up here.

This is a diversesite with many talented amateurs and you will receive many different replies to your questions. Since only you know your situation, only you can answer them in the end. My views have changed over time.

I have minimized my current expenditures and am using those funds to maximize my contributions to my TSP account, including max over-50 catch-up. That makes 15% plus $4000 plus 5% match for about 25% of my base pay.I will use raises and bonusesto reach the new ceilings which will go into effect after the first of the year.

Now what to do with it? I choose not to trade it around a lot. InsteadI haveestablished percentages for allocating my new money and I follow those percentages when making purchases. I make purchases from the 'cash' account = G-fund.

Note that I do not refer tosales, only to purchases. I intend to sell the day I cash out the account and roll it into my IRA, not before. In five years I will be eligible; I'll see where I stand at that point and decide what to do then.

I experiencepain when prices decline and they start taking money away from me. I'm shoveleing it in there and sometimes it just seems toevaporate. But in the end, prices always rebound. Today's price is irrelevant if I'm not selling today. Right? Instead I work on increasing the share-count, the number of shares I own, and I rely on time to do the work for me.

You too should be able to reach the contribution limits. You have 17 years to spend accumulating shares. You might find the end result a little staggering. I betyou never thought you could be a net-worth millionaire. Good luck!

Dave

[Dave M]

From back in June: "What I am going to do is go through my records and see just how much money I have contributed over the years, how much is matching, and how much is growth on the whole kitty. This will show, I believe, that the portion of the total balance in my account which actually came out of my pocket, is about 1/3 of the total."

Mission accomplished. In search of something else I came across the missing data. It turns out that my own money represents about 40% of the total. Matching funds and intrinsic growth account for 60% of the net asset value and hence exceed my contributions by 50%.

The dollar-difference is widening. This is the wedge-shaped area between the two curves on my graph, Balance and Contributions. Using my estimate of future contributions which is pretty closely known, I can come up with thedollar-total which will pertain when I hit The Wall in 2010 -- my total lifetime contributions in dollars. This I can use to make an estimate of the 2010 balance by using the wedge.

The answer confirms previous estimates. If I continue to have earnings and matches that exceed my contributions in 60-40 proportion, and that ratio applies in 2010, I will make my goal and to spare. If the ratio slips to 55-45, I will just make it.

Right now I have 35% of the balance in the G-fund. I think I'll call that "My Money."

Dave

P.S. Itamused me to learn that my contributions this year will equal the sum total of all my contributions for the first 6 years. In the year 1, 1987, I contributed less money than I do in one pay period these days. *smile*

[Dave M]

Here is a link to a site I found very helpful while remaining light and even amusing. For one thing, it has convinced me of the value of periodic rebalancing.I am going to rebalancemonthly and see what happens.

That means I will always be close to 35G 26C 26S 13I dollar-wise but the share-count will fluctuate in each fund in accord with changes in prices,keeping risk under control.

http://www.efficientfrontier.com/ef/996/rebal.htm

Dave

[Dave M]

...which means I must revise my thoughts about share accumulation. And I should also get my contributions into the same proportions.

There are three more trading days left in the month. Assuming more flat-to-down results, I will be selling a few shares of G-fund and buying more shares of CS&I. As there is also a payroll contribution coming this week, I will wait until that shows up, THEN rebalance.

Dave

[smine]

New Orleans is preparing for a major hit from Katrina. The mayor has already told people to expect no electricity, so I'm wondering since our TSP office is there, if any transfers will happen tomorrow:shock:

[Dave M]

Quite right. As a long-term investor I am not overly concerned with being able to make the microscopic transaction I have in mind; I can wait. They can't leave millions of us hanging indefinitely though -- they are sure to havea backup plan.

As for using the strategic petroleum reserve, it would be purely symbolic. The reserve is for the use of the navy in case of an embargo. That is what makes it strategic. (Did you know that on the Japanese side, the oil consumed by the IJN in the Battle of Midway would have powered their economy forsix months? That is according to Walter Lord.)

In size our reserverepresents a tiny fraction of our national useage and is practically useless as a means of manipulating the oil market price. But symbolically it might work, for a while.

Dave

[Show-me]

I don’t think there is a back up plan.

Excerpt from Sarah:

It should be noted that workers at the parallel call center are not able to access accounts -- because the center in New Orleans is closed - but they can answer more general questions and explain the developing situation. TSP officials have said it is important to have someone to answer the phones, instead of a busy signal or no answer at all.

It is therefore important that you check your allocations both before and after the storm passes to ensure their accuracy.

[Dave M]

I rebalanced today, 35G 26C 26S 13I;in effect cob tomorrow, I think, asI dialed in at 1230.

It will be a very small move as the indices have netted small moves for the month. I had some contributions, though, so now everything is where it belongs. When I get the confirm, I will learnthe exact before-and-after statistics, so check back.

So far this quarter I am in positive territory with earnings of 1.6% of the total, or about 3% on the amount invested. For the year I am perfectly flat after subtracting contributions. Hmph.

Ideterminedin June that the only way to capture all the positive market days was by remaining invested 100% of the time, and I felt sure that the gains would exceed the losses over time. This has been thecase thus far. I realize it is only ten weeks.

So let's drink to a profitable September.I announce I will split 50-50 any gains this month with the Red Cross, on top of my usual annual contribution.I'll write the check October 1. Remember, if we sell, the terrorists win.

Dave

[Dave M]

I got my confirm this evening. A small amount of money left the I-fund and S-fund, going into the C-fund and G-fund. That tells us which funds didbetter during this period.

Buy some I -- diversify.

For the period from the close 7/29 to the close 9/2, the five trading weeks of the month of August, the C+S+I all-funds index increased by 46 points, or 1.01%. That means if you had 100% of your money spread evenly across these three funds, that would be your rate of earnings. My money is spread unevenly, of course, and my earnings for the month werezero to two decimal places, just $186.Not much, but better than losing a like amount! I remain 35G 26C 26S 13I.

BTW, I had no difficulty making my transaction. Good luck!

Dave

[Dave M]

Things are looking good for the Red Cross. This week I seem to have earned 1% and a fractionon the total balance, of which 65% was actually invested. That equates to about 1.6% on the amount invested. But wait! The G-fund also paid a penny so that counts, too.

Anyway it was a very good week for all of us. Let September be even here on out, and who can complain? Good luck everybody!

Dave

[Dave M]

We managed to hold our own this week, almost. A couple of contributions arrived which helped. When we get our statements at the end of the month I will know for sure, but at this stage it looks like the Red Cross has earned ~$400 so far. Ten more trading days to go...

Good luck everybody!

Dave

[Dave M]

Three hurricanes in ten weeks have impacted us here in Key West. It has been one heck of a season. It will be a real joy to go up to NY State next week to attend my nephew'swedding, let me tell ya. I'm rock-happy. *smile*

And can anyone tell me why I have had over 5,000 views of this Account Talk page in the last month or so? The count went from about 6,000 to 11,000+.

Anyway, we are entering the home stretch for September. Last week erased the gains of the first week of the month, so I am hoping for something positive now. Perhaps the realization that neither Katrina nor Rita have dealt us a lethal blow, and that life mustgo on, will sway investor sentiment.

I believe I will have to wait until the first week of October to determine the amount of thedonation I will give the Red Cross. I need to see my quarterly statement. Ifit ends up being small or negative, I will set a floor of $250 which is my usual annual donation, so that will double it. (For years it was $100 but last year I increased it and specified Florida as the recipient of the assistance. The way it is going in the tropics lately, the donationwill continue at the higherlevel.)

Also at the end of September I will rebalance my portfolio to my desired 35G-26C-26S-13I allocation. Good luck everybody!

Dave

[Show-me]

Dave M wrote:
And can anyone tell me why I have had over 5,000 views of this Account Talk page in the last month or so? The count went from about 6,000 to 11,000+.

A secret fan club? :l

[Birchtree]

Obviously others like the way DaveM manages his account - and are interested to see how he controls his emotions to be successful. That's impressive!

[Dave M]

And another 1,300 page-views are registered overnight, practically. Whatthehell...?! D

[Birchtree]

Dave M,

I think members of the military may be viewing to gain education as to what to do with the unlimited sums they can invest in 2006 - no caps on them. They are in a tax free zone mostly and salary is the only limiting factor - hooah!

[Dave M]

BT, write down the number in your Account Talk and then check back. I think ALL the page views are increasing swiftly. You may have a point about the boys in the militaryshirts, but really -- thousands per day?! (Cue theme from 'Twilight Zone.')

Back on-topic, a good day today may mean a good month for September, good news for all of us who have remained invested through the ups and downs. And here is a thought for you my friend: the U.S. market is being out-performed by the foreign markets this year. Is it not time for you to diversify and buy some I?

Dave

[grandma]

Dave M wrote:
BT, write down the number in your Account Talk and then check back. I think ALL the page views are increasing swiftly. At this rate, the lot of you will have to change to roman numerals to have space !!! Tho the metric might work, too.!:l

[Birchtree]

DaveM,

As a family unit, I'm covered . My wife owns an international fund in her Florida Retitrement System account. So we tend to be diversified, it's just not visible. A new wave of dividend-paying mutual funds is helping to bring Japans stubbornly bearish individual investors back to their stock market. The recent move in the Nikkei 225 is real and has been supported primarily by foreign investors, but now the domestic individual investor is starting to participate via mutual funds.

Dennis

[Dave M]

Sixhundred hits occurred overnight; I went from 12,8xx to 13,4xx. I think we are being spied upon, maybe being preyed upon, by outsiders. Alternatively, maybe Tom's new server is registering its internal housekeeping operations as hits.

Let's be sure to be clean when we visit, and avoid coming here directly after viewing our Account Summary at TSP.gov or after making a purchase at Amazon or something, where our data may remain in the cache. Close that browser window like they recommend.

Dave

[Dave M]

Eight hundred hits in a day and a half, hm...

Here is my initial estimate of September. I had 1.1% net increase on the total balance, which works out to 1.7% on the amount invested. The C+S+I index advanced 61 points or 1.3%, for comparison.

For Q3 it looks like my gain was 2.7% of the total and 4.1% net on the investment. C+S+I was up 285 points for 6.6%. After I get my Q3 statement I can refine that and work out my YTD figures.

My figures will always be less than the index's since I am only partially invested and that not evenly across the three funds. Since the I-fund has been leading the pack and it carries half-weight in my portfolio, the index leads my return.

I have rebalanced to 35G 26C 26S13I. When I get the confirm I will report.The Red Cross is in for a nice boost in a few days.

Dave

[JOVARN]

Hi Dave As I am still new to this site I am not sure what hits are, can you elaborate on the “Sixhundred hits occurred overnight� What does that mean?

Thanks

[grandma]

Dave M wrote:
Eight hundred hits in a day and a half, hm...
Dave, just oo curiosity, when I got home at 0130 I noted several of you guys' numbers. You were 13612. Now, at 1030 am, it is 14419 - Some of the others had even greater increase in viewers in this same time span! I don't believe it is the server in doing the maintenance, becuse there are only certain ones who have the sudden increase in viewers. Fascinating puzzle ...!!

[Dave M]

I forgot to check the hit-count yesterday but it is up a thousand in three days as you can see from grandma'spost above. Oh well.

My confirm came through yesterday. Q3 statements are not yet available. In this rebalancing, a small amount of money left the I-fund, the C-fund and the S-fund, all of which flowed into the G-fund which increased by about 100 shares = 1 part in 60.

When our statements are available I will be able to see just how I stand. Good luck everybody!

Dave

[Dave M]

Q3 statements finally are in. Tomorrow I send a check for $700 to the Red Cross for Katrina relief.

5000 hits in the last 15 days.

Good luck everybody.

Dave

[Dave M]

Two days ago Key West suffered a Katrina-like backhand blow from Wilma whenthe Gulf of Mexico crossed over to the Atlantic side. In places it was chest-high. It drained away in a couplehours, being an island. It leftbehind hundreds of soggy homes and thousands of drowned cars. The same is true up and down the line.

In my case my home is dry but my car is toast -- my '93 Ford with 150,000 miles on it which I only drive to the grocery store, my semi-retired heap. My wife's place of business was flooded, stock a total loss and no customers anyway.

Oh well. A week ago I bought a new bicycle and once it is deliveredI will be pedaling in style.

http://www.giant-bicycles.com/us/030.000.000/030.000.000.asp?year=2005&model=11095

Dave

[Dave M]

I rebalanced today. A small amount of money left the G-fund and the C-fund, and entered the S-fund and I-fund, mostly thanks to Friday'sexcellent advance. I am once again 35G 26C 26S 13I. Once I get the confirm, I can calculate my performance for October.

Fridayshows the correctness of my strategy. Had I been cautious as I was in Q1, I would not have been invested and would instead have been on the sidelines waiting for the downtrend to reverse itself.I would have missed the 1%+ gain that we experienced. By going long and holding on, I have gotten all the gains there are to get. It is an act of faith that the ups will excede the downs, over time. So far so good.

Good luck everybody!

Dave

[Dave M]

October was not so good. The C+S+I all-funds index slipped 108 points from 4602 on 9/30 to 4494 on 10/31, a loss of 2.3%. My own portfolio slipped a net 1.2%, the difference being the G-fund mainly.

It is interesting to watch the movement of shares due to rebalancing. FromAug 9 toOct 31 over 600 shares have left the G-fund.This means that the portfolio has automatically purchased shares in the stock funds over time, accomplishing dollar-cost averaging. The reverse will happen when the market rises -- shares of the stock funds will be sold progressively. I am happy with the periodic rebalancing. I remain 35G 26C 26S 13I.

I took my new ride out to the sea wallfor tryouts, still practicing and adjusting. Fun!

Dave

[Dave M]

This month has been very encouraging so far. With just four more trading days in the month, we are pretty much assured of a couple percent gain no matter what happens.

On the 30th I will rebalance. Unless things change between now and then -- and why should they? -- I will increase my holdings and go from 35G 26C 26S 13I to 25G 30C 30S 15I for the final year-end rally.

If that holds up then for the final week I may go all-in! I actually have a chance to achieve my dollar-value goal for the year, which looked impossible during the summer.

Good luck everybody.

Dave

[Birchtree]

Dave,

Congratulations on finding your comfort level - now has dollar cost averaging been good to you - especially during that last October correction? Now you will begin to buy automatically all the way up - probably even catch a few short pull backs if the timing is right. I'll watch how you rebalance to go all in. Good purchasing to you.

Dennis

[Dave M]

I rebalanced; it will go into effect COB today. I decided to stay with 35G 26C 26S 13I and not increase my holdings, because things have been so iffy lately. When I get my confirm I will be able to evaluate the month. As of the 25th I was doing quite well but then came that 1% loss...

One thing is clear: the October down-turncaused me to buy more shares of the stock funds when I rebalanced at the end of the month. Thus I did better than otherwise inthe Novemberrise, because I had more shares. This month shares will flow in the opposite direction, locking in those gains. I will get the numbers in a couple of days.

Good luck everybody.

Dave

[Dave M]

My confirm came in last night. On Oct 31 the C+S+I all-funds index stood at 4494; on Nov 30 it was 4656, for a gain of 162 points, or 3.4%. My portfolio rose by 2.4% on the total, about 3.5% on the amount invested. That was slightly better than the index because the I-fund didn't do much this month, and it is the smallest fraction of my total, only half-weight compared to C and S. Also I count the match as earnings and not contributions, heh.

In the rebalancing, about 150 shares went back into the G-fund, I-fundgot some shares,C- and S-funds shrank slightly. Remember my new money goes 40-40-20 CSI which complicates things.I start the month 35G 26C 26S 13I.

If December does what Novemder did,I will reach my goal for the year. Good luck everybody.

Dave

[Dave M]

Before noon tomorrow I will adoptthe following allocation 35G 20C 20S 25I.

I have decided that the preponderance of the evidence points to overseas markets continuing to outperform the US market.A case can be made for a falling dollar, too.

So I will increasethe I-fund from one-fifth of the total invested to two-fifths, while remaining 35% in cash. My contributions will go from 40-40-20 C-S-I to 30-30-40.Each month I will rebalanceto 35-20-20-25.

Here's to a prosperous New Year!

Dave

[Dave M]

For the year 2005 my account increased in value 15%. However my contributions amounted to 63% of this. My net earnings for the year were thus 5.5% on the total balance. This includes the gov't match which I count as earnings.

Considering how naive I was in the first six months of the year, this is okay with me. Now that I have myself properly orientated I think my results will be better in 2006.

Dave

[Dave M]

About a third of the 5.5% was the result of the match. Take that away and the actual increase outside of all contributions was about 3.3%. Is this in the middle of the pack, TSP-Talkers?

Here is a recap of my activities in 2005:

The first quarter was a disaster as I sold low, then lower, then lower, missing all the increases and catching all the downers. I ended the quarter minus 4%.

In Q2 I was very jumpy, in and out a lot, and gained some of it back. I ended the quarter down just 2%.

This is where I wised up. I quit jumping around. I chose a risk level appropriate to me, 35% cash and 65% equities. Then I allocated the 65% among the various funds based on a strategy of diversification -- in proportion of 2-2-1 C-S-I.

I entered Q4 up 0.7% and finished the year up 3.3%. Stready-as-she-goes had done the job.

For 2006 the only tinkering I have done is to increase the I-fund allocation so that now the funds are in proportion 3-3-4 C-S-I (instead of 2-2-1). Otherwise I plan to stay the course. The key is regular rebalancing back to 35-20-20-25. I do it monthly. (The L-funds do it daily, for comparison.) Rebalancing assures that earnings -- and hence risk -- will be in proportion to the given percentages.

By joining TSP-Talk last year I learned a great deal and inexpensively, too. My contribution for 2006 will be coming soon, Tom!

Dave

[Birchtree]

Dave-M,

Good to see you making upward progress - it don't hurt a bit to get those dollar cost average prices does it? Can you see the potential when you arrive at double your current asset base? If this bull stays on the snort you'll get there even quicker. Keep your strategy working. Take care.

ps. Could you lend me some of the G money you aren't using for the moment, providing you aren't going to spend it buying higher and higher.

Dennis- permabull #2

[Dave M]

Ah, my friend. The $$ is in cash in order to manage my risk. What use would you make of it, and what risk would you be taking with it? In essence you would be buying on margin, very very dangerous.

Fourth-quarter statements are in. I have to wait until I get back to the office to print it. Scanning it reveals that earnings were approximately equal to contributions. I am contributing the max plus catch-up, so I am happy.

It also looks as though January's earnings will be about the same as those for the entire 4th quarter, so I am even happier. In a few days I will rebalance back to 35G 20C 20S 25I and then we will know for sure.

Dave

[Dave M]

I printed up my statement and have had some time to go over it.

It looks like a 2.8% gain for Q4, which I count agency matching funds as earnings. For the year '05 the change in Net Asset Value was 15.0% of which 63% was my contributions and 37% was earnings. This gives 5.6% increase in NAV due to earnings.

In Q1 I suffered a 4% loss, so in the last three quarters I gained almost 10%. Three-fourths of that was in Q3 and Q4, which is when I switched to a buy-and-hold strategy.

In a few days January will end, and I will rebalance to 35G 20C 20S 25I. As of today the C-fund and the G-fund are lagging so they will receive some shares.

It also looks as though January will have earnings equal to those for the entire year '05, or nearly so. The question will be, What would happen if I retreated to the G-fund for the rest of the year? If I make 5% in January, then another 5% from the G-fund would yield around 10% for the year, or about twice my earnings from all of last year (5.6%).

But would it get me sufficiently close to my dollar-goal for the year? I want a total increase of $40,000 for the year '06. I'll be contributing around $20,000 so I should be able to work it out on that basis.

We had plenty of downs as well as ups in Q3 and Q4, so the solid performance builds confidence in the allocation. Right now my feeling is to let it ride.

Dave

[saturneptune]

Dave,
Does the S and I fund at record levels, and the C fund near that influence your allocation decision above at all? I guess I am just a little leary being 2 years from retirement. Thanks

[Birchtree]

Saturneptune,

With two years to retirement most logical folks would advise you to stay safe and comfortable in the G fund where you are currently sitting. If you have never experienced the power of a true bull move then you won't mind missing the opportunity to make some large bills in preparation for retirement. Dave-M has a solid allocation and will continue to make gains even in some down moves - but I feel a long lasting and powerful price advance is in the process of building momentum - you shouldn't miss the opportunity to benefit. Dave is thinking 10% would be fine but 35% could be divine - and it may happen, but you must be in to win.

Dennis - permabull #2

[saturneptune]

Dennis,
Thanks for the advice. It does give me more confidence. I will probably let the TSP set after I retire in some type of mix, so not sure when Ill take it out. Thanks again

[Dave M]

S-N, I have 4 or 5 years to go. But the $$ isn't going anywhere. Like you, I plan to keep it in the TSP. This could amount to a decade or more, so I don't think I'll ever go completely into cash; we need inflation-protection.

As to your question regarding current pricing, the allocation is designed to take advantage of increasing prices. Prices are increasing. I am getting earnings. The allocation is working.

The allocation also is designed to offset falling prices through the use of the G-fund. If the stock funds are steady or slightly lower, I will lose nothing. If they fall somehat, my pain will be a fraction of Dennis'.

So the short answer is, no. The change in price is more important than the actual price. Canyadigit?

Regular rebalancing assures that the portfolio's components remain in...balance. This is the sine qua non of the strategy.

Dave

[Dave M]

I received my IFT this evening. For the month of January I saw a 4.2% increase with a change in NAV of 4.75%. That's not chopped liver, it was a very good month.

I had rebalanced to 35G 20C 20S 25I. Money flowed into the G-fund, the C-fund was nearly unchanged, and the S/I-funds lost some. This means it is unneccessary to think about retreating to the G-fund with my gains -- it is happening automatically, I just bought 300 more shares of it. My downside risk has diminished.

Good luck everybody.
Dave

[Dave M]

February is in the can. I initiated my IFT for the month yesterday (after 12N), knowing it would go into effect today, so I already have my confirm. I have rebalanced to 35G 20C 20S 25I.

For the month earnings were positive but negligible, percentage-wise. It looks a little better if I end the month of January as of the close on Friday the 27th since there was a big surge on the last couple of days of that month.

But for the quarter, which accounts for all that, I stand ahead by 4.25%, including the gov't match but excluding my own contributions; there has been a 5.63% change in NAV overall. Nice, for two months. You can't do that in the G-fund.

On my IFT, since share prices changed so little over the month, the share-count in each fund also changed little. Each fund incremented upward in proportion to my contributions, which are in line with my allocations.

Here is to a profitable March. If we make 2% more I will have one of my better quarters.

Dave

[Dave M]

Let's compare funds for the year so far, that is, Jan and Feb. Just divide the price on Feb 28 by the price on Dec 30 and you get: G 0.7%; C 2.95%; S 5.6
%; I 6.1%.

So if I had been 100% invested in the C-fund since the start of the year, I would be ahead by slightly less than 3%.

By being diversified and capturing the rises in all three stock funds, I have beaten the C-fund using while only 65% of my capital. Are you reading Birchtree? My risk was 65% of yours and my gain was 144% of yours.

Dave

[Dave M]

I mis-calculated a little in the above; I included the match. Taking that away leaves ~3.9% instead of 4.25%. This is still above a 100C allocation.

Also, the fall at the end of Feb will just make Mar look that much better!

Dave

[Birchtree]

DaveM,

Let's take it from yesterday back to January 31 - and see what things look like. I still have a hard time working with percentages - actually prefer the real numbers.

The G fund gained $.04
The F fund lost $.03
The I fund lost $.11
The S fund was zero sum
The C fund gained $.11

I do know that a higher percentage of a higher number means more money. Right? You had smaller percentages of smaller numbers therefore a little less money, right? Now I did have the unfortunate pleasure of doing some dollar cost averaging that adds to my bottom line for a few dollars more. I made 100% purchases at $13.74 (wish I had more of those), $14.01, and $14.02. The purchases made in January were $13.96 and $13.70 (wish I had more of those also). So fate treats me fairly well. Your system is the correct way to travel and this marathon race is just getting started - I usually start from the back of the pack and try not to trip over the falters. Keep up the good work.

Dennis

[Dave M]

FundSurfer's tally shows me at 3.44% while I estimate 3.9%. The difference is due to rebalancing I think. We will know more a month from now when statements are available, which is a move.

Birch, no fair cherry-picking. Take anything from Jan 31 it looks a lot worse than if you take it from Jan 27. (I am smiling.)

Hey, do well, my friend. The better you do the better I do, too.

Dave

[Rod]

hi dave, is anyone talking about a ROTH type option for TSP?
Congress passed legislation for ROTH 401(k)s that went into effect 1 Jan. 2006. this would be like a ROTH IRA were you pay tax now on your contribution and all the money in the account plus all the compounding would be tax-free at retirement. please help get the word out
THANKS Chris

Hi Chris,

I'm moving your question to the IRA forum since this is specific for Dave's account talk.

http://www.tsptalk.com/mb/showthread.php?p=39330#post39330

Thank you!

[mlk_man]

FundSurfer's tally shows me at 3.44% while I estimate 3.9%. The difference is due to rebalancing I think. We will know more a month from now when statements are available, which is a move.

Dave

Dave, you are correct. I can't track how your contributions are being distributed so I have you maintaining an allocation of 35G, 20C, 20S and 25I all month.

M_M

[Dave M]

It seems to me this question has been aired before -- How come the tracker's returns are different from the return calculated by the poster?

The tracker takes an allocation and sticks with it, in my case. When I rebalance to 35G 20C 20S 25I it does not count as a move, to the tracker. But every month contributions have been made and prices rise and fall. This results in a different share-count and so the percentage-change that I see is different from that of the tracker. For example, I added 300 shares to the G-fund on Feb 1 since the stock funds did so well that month. But the percentage remained 35G.

But enough. The screaming message from the tally so far is...what? I see the S-and I-funds on top. Therefore it is reasonable to conclude that those of us most heavily invested in the S- and I-funds did the best. This month the story is likely to be different. Maybe the C-fund will finally take off. That means those of us most heavily invested in the C-fund would do best in March. (So far the G-fund looks pretty good, this month.)

That analysis is practically the entire basis of my allocation. By being diversified among all the funds (except F) I will always participate in whichever fund happens to be doing best. It will keep me out of the Top 10 but also will keep me out of the bottom 10, too. I should always be in the middle somewhere.

That is where I fell, 27th out of 80 or so. That seems kind of high. But note the L2040 at 22nd. That is going to be my milestone. My goal must be to beat the top-performing L-fund or quit trying.

To do this I think I will have to increase my stock allocation. The L2040 has 15% in G+F, I have 35%. I will look closely at the end of the quarter. My inclination at this time is to increase each stock fund by 5, to 20G 25C 25S 30I. That would be a 23% addition to my risk, hmm...

Dave

[rokid]

Dave M,

Your analysis is right on. By being diversified you'll never be #1. However, you'll also never be #80. My personal goals are to be in the top 25 of TSP returns and to achieve a S&P 500 return with less risk (approximately a 12% return with a 10% standard deviation).

I ran my optimizer against your old and new allocations.

old: expected return - 10.9%; expected standard deviation - 11.5%
new: expected return - 12.1%; expected standard deviation - 14.1%

Hopefully, the return will be higher and the risk lower. :) Good luck!

[Dave M]

I have given the idea some more thought. My latest brainstorm is to have a little fun and make each of my fund allocations a prime number. That means 23G 23C 23S 31I.

The L2040 carries 10F. This is pure drag. Also it is about 42C which seems to me to be too large a weighting for any single fund, especially since the C-fund has been lagging for months.

This will increase my exposure by the ratio of (1 - .23) / (1 - .35) = ~18%. Multiplying my 3.4 percent two-month return on the Tally by 1.18 gives ~4% which exceeds the L2040's return of 3.8%. Therefore, all things being equal, the allocation above should put me ahead of the L2040.

Waddya think?

Dave

[Spaf]

Dave, I think you got a good idea. Especially to stay away from funds that are a drag.

On entry I go on least risk: 50G 20C 20S and 10I. Once those numbers have some profits, I add to them on strength. Last week 100% strength was 25C 35S and 40I.

I like keeping 20% in reserve, and I'm not a big fan of the I-fund so I may go 30C, 30S, and 20I.

I generally put some paper stops in on the C-fund [$SPX]. 1% Alert and 2% Trail.

CMF money flow was decreasing. Don't know why the money is coming out??

MACD is increasing. And a watch of the Histogram will spot trends.

The STO gets unreliable when it gets high, until it breaks.

The RSI is near over bought, but in a bull run it could stay high.

Gas is high. It has to be greed and spring break!

Take care my friend. Rgds..........:) .............Spaf

[Dave M]

I put in for 23G 23C 23S 31I today after 12N so it should go into effect with tomorrow's close.

Yes, they are all prime numbers, heh. Is it unique? No! 17G 23C 23S 37I is legal. Maybe next quarter that will be the way to go.

Q1 is shaping up to be one of my best quarters yet and I have high hopes for Q2. In a few days we'll see how I did relative to the L2040, my new benchmark. I have the feeling that I slaughtered it in March so for the quarter as a whole it will be close.

Good luck everybody!
Dave

[Dave M]

Q1 '06 will easily be my best quarter yet.

I estimate 2.2% for March. Adding 4.2% for Jan and 0.0% for Feb I get 6.4% for the quarter. In terms of dollar-value, it is 20% higher than my previous best, Q4 '04.

I know, the numbers on the monthly tracker will not match this. There was over $5000 in contributions during the quarter, the account was rebalanced monthly, and I count the match as earnings. The tracker will give me 1.8% for March and 5.3% for the quarter/YTD I think.

The L2040 looks to be up 5.8% for the quarter, just dividing the prices and discounting compounding. Here's hoping the new allocation closes the gap.

Good luck everybody,
Dave

[Dave M]

With the statement it is easy to calculate.

The change in NAV was 8.7%, one-third of which was contributions. The market gain was 5.6%.

The all-funds index went from 4741 to 5121, an 8.0% increase. My 5.6 is 7/10 of that. I was 35G.

The increase in my account was equal to my net pay for the same period. My future-self made as much as I did. Cool.

For Q2 I have allocated 23G 23C 23S 31I.

Dave

[Dave M]

I have moved some out of my worst-performing asset and put it into my best-performing asset. For May I will be:

17G 23C 23S 37I.

Tentatively I have decided to do this every month. The presumption is that the coming month will correlate with the last month. The allocation will reach an equilibrium condition or it will be forever in catch-up mode. We'll see.

In any case ya gotta love the I-fund.

Dave

[Birchtree]

DaveM,

You are experiencing trepidatious love of the I fund at 37%. I am on the other hand experiencing what is known as bodacious love of the C fund at 100%. Isn't love grand? Have you been following my flames with my nematode nemesis - it's basically childish. Take care.

[Dave M]

They get in my houseplants.

In order to get set for the first of next month I had to re-allocate before the end of this month. I assumed the S-fund would climb slightly, today, because as of yesterday the G-fund was doing slightly better for the month of April. We shall see.

Oh, I also re-allocated my contributions to the above percentages. That way I can see at a glance how I'm doing, over at TSP.gov.

Dave

[Dave M]

Now that I have my Q1 statement, I can tell exactly how much is contributed pay period, by myself and by the agency which I can now account for.

That makes it easy to see that the account earned 2.0% in April, with a change in Net Asset Value of 2.9%.

YTD the change in NAV is 11.9% with earnings of 7.7%. Earnings and contributions are in the ratio of 9/5, familiar to weathermen. I am contributing in degrees centigrade while the account accumulates in degrees Fahrenheit. *smile*

From TSP.gov the ratio of the L2040 on Apr 28 and Dec 30 is 7.7%. Factor in contributions (which would add to the basis) and that might climb to 8%.

So I have just a short way to go to be able to say I am beating the L2040, which is my benchmark.

Good luck everybody.
Dave

[Dave M]

Some month of May, eh? Everything was going so well. On the 9th my account peaked at a very handy 9.9% YTD according to Rokid's chart, coming in just ahead of the L2040.

That was a Tuesday. Then came Wednesday Thursday and Friday, wham! After Friday's close I had seen enough and put in my order. It went through Monday. I actually made a little money in the I- and G-funds since my last purchase/rebalance on Apr 28th. The net loss was 0.6%.

Since then the drop has been precipitous. We have seen big rebounds after big drops this year. How likely is that? I may give it the rest of the month to settle out, I'll see how it goes.

Good luck and be safe out there.

Dave

[Dave M]

Today is the day many of us will make a decision. Do we get back in?

Asia is looking positive in the early going, commodities are not skyrocketing. Maybe today we will get a little more upward vertical motion. If the planets align, I will make a trade before noon today.

Whenever, I will ease back in over a period of time and gradually work down to my baseline of 17% cash (G).

Dave

[Dave M]

It looks like most of the shakeout is complete. That is, the big drops have ended and we're seeing occasional rising tendencies. I bought a few shares today -- in effect tomorrow -- so I will soon know for sure.

71G 7C 5S 17I, yes they are all primes!

Dave

[James48843]

A "Prime" strategy! I LOVE it!


OK Folks- what could you do with these?

Primes:

1 2 3 5 7 11 13 17 19
23 29 31 37 41 43 47 53
59 61 67 71 73 79 83
89 97

[Fivetears]

Add them all together and get 1061? :blink: :nuts:
A "Prime" strategy! I LOVE it!


OK Folks- what could you do with these?

Primes:

1 2 3 5 7 11 13 17 19
23 29 31 37 41 43 47 53
59 61 67 71 73 79 83
89 97

[Dave M]

If you include zero, then we have 27 numbers. We take them 4 at a time -- (27 4) = 27!/4!x23! = 27x26x25x24/4x3x2 = 17,550 possible combinations.

We require that the sum = 100. The permutations are distinct since 3C7S is different from 7C3S, for example. And we should allow for repetitions, like 23C23S. I can't figure out how to calculate this, the total number of valid allocations.

It is clear that there are many. See some of my allocations from earlier in the year.

Dave

[Dave M]

Today was gratifying. Not "deeply" gratifying though, because I was only 29% invested. *smile*

Now the question is, what position do we want to be in Tuesday morning? I assume the site and the market will be closed Monday for Memorial Day. Is that correct?

If so, we have until noon tomorrow to decide. Right now my inclination is to add another increment, say 53G 13C 11S 23I. My risk will increase by (100-53 / 100-71) = 47/29 = 1.62 for 62%.

We have only three more trading days in the month so if we are to emerge from the red, now is the time. (My losses were minimal really, in which I was very fortunate.)

I will post the move in my account thread when I do.

Dave

[Dave M]

I have decided I am in no hurry to get skinned.

If the market holds on and rises today -- if we have turned a (local) corner -- then I will benefit as I do have some $$ on the table. If there is faltering then I will incur only limited losses because of my partial position, and yesterday's gains will be offsetting.

So I will wait and see where we stand on Tuesday morning. By nature I am a long-term guy but also I am taking your good advice, Skip -- "Be nimble." Being nimble of May 15th saved my butt, heh.

Dave

[Dave M]

Today we did it again, very good news for all of us.

In my case I now estimate +0.5% for the month. I take my cue from S&S and call it dumb luck. The all-stocks index fell from 5239 on April 28 to 5076 today for -3.2%.

I see no reason to do anything until the 31st, I'm standing pat,
71G 7C 5S 17I.

See you then, good luck eveybody.

Dave

[Dave M]

The whole world seems to have the jitters. If we're going to show a profit this quarter, it looks like we'll have to hold on to what we've already made because the immediate future is doubtful. So today I went 100G.

One must be in to win, yes. I was in, and I did win, over the last year or so. Now it seems in order not to lose, one must be out. I hope not to be out for long.

Good luck everybody.

Dave

[Dave M]

Just for fun here are my year-on-year figures.

The all-stocks index stood at 4238 a the close on May 31, 2005; and was 5042 on May 31, 2006 for a 19% increase.

My NAV increased by 26% over this time, 12% from my contributions and netting 14% from the market.

So I captured 14/19 = about 75% of our three stock funds' rise in average value.

For comparison the G-fund is up by 4.7% which we could call 5% given compounding. Added to my 12% from contributions (fixed) gives 16.7%. My 26 divided by the G's 16.7 = 1.57, which says that by being in the market over the last twelve months, my total balance increased in dollar-value by half-again over what it would have, had I been in the G-fund instead.

Another way of looking at it is that my 12% contributions was on the same order as my 14% earnings over the year. Had I been in the G-fund, my contributions would have been two and a half times my earnings. (12/4.7)

So it has been a good twelve months. It encompasses the time I decided to stop trying to time the market and to stick with a basic allocation defined by my risk level.

Dave

[nnuut]

Dave, you have quit timing the Market but have enough common sense to get out when it's on a down trend!! DUH! Good job.:D
Norman

[Dave M]

My common sense was pure emotion, my friend. I could have missed a big upswing just as easily.

I weathered several downturns over the last year but they were nothing like this. And now I feel like I used to when I was an active player and had a high chess rating -- to protect. When you can play ten games at the club, win nine and lose rating points, it changes things.

So here I have earnings to protect. Remember I have only about three more years to go; there is no time to make up for another disaster like Q1 '05 when I lost $5k, my 'timing phase.' My Yr-on-Yr numbers look good because that quarter has faded from the calculations.

Onward!

Dave

[nnuut]

June and July of 05 got me good. Kept hangin' in there to catch the BIG RALLY> Oh no, no, no, I don't do that no more!;)

[Birchtree]

Snort!

[Dave M]

Hey, save me some! *snort* Aah.

The dumb money (me) made a small move. At the close today I will be

89G 3C 3S 5I.

If the results are good then I will add to my position over time.

Dave

[Dave M]

Congrats if you are in 100% today. I just added some to my position and will be 79G 5C 5S 11I cob today.

By way of remark, note how even bad news can be good if it removes uncertainty. We got a CPI that was higher (worse) than anticipated, yesterday. This increased the liklihood that the Fed will raise rates this month. This is bad news in an otherwise-undisturbed market. However the market is very disturbed, and this increased liklihood of a rate increase has acted to reduce that, resulting in some gains in the indices.

One thing we can say for sure, this rate increase has already been priced into the market, and then some. My feeling is, we will rise back to where we ought to be, now that we know the score.

A bit at a time, I am getting back up on the horse that threw me.

Dave

[Dave M]

It was three tenths for me, not two as I estimated over at Carnac's Corners. Free coffee tonight at Dave's Diner.

Dave

Oh, yeah, I edited my profie.

[Dave M]

Read about Len Snellman in the attachment, courtesy of the Air Weather Association. The relevant quote:

"He...coined the term, "Meteorological Cancer," in a 1977 paper. He defined it as the increasing tendency of forecasters to abdicate practicing meteorological science and becoming more and more just a conduit of information generated by computers. He challenged all operational meteorologists to fight the disease...."

(Len Snellman taught the weather school when my father was at Ft Hood Texas flying B-17's. I met Len when he was working in Salt Lake City while I was in grad school at the Met Dept there; one of those things.)

Meteorological Cancer can be extended to the financial world I think. How much actual thinking is going on?

Dave

[Dave M]

Here's a quote from someone who believes as I do. I don't know who he is but he has his finger on it.

"Somewhere out there, when the mood changes, demand for those shares" will return, McIntyre said."

Tom McIntyre, president and chief portfolio manager at Massachusetts money manager McIntyre, Freedman & Flynn (CNN Money)

He was referring to what would be the C-fund in our world, but it is mood that concerns us.

Dave

[Dave M]

I wanted another increment this month and I got it yesterday. I presume that the good day overseas will offset the negative domestic day underway, given my allocation, and that it is now safe to retreat to the Neutral Zone.

I have no faith at all in the markets next week. The Bernanke Panic may be on again, so I will finish the month and quarter in the G-fund.

Good luck everybody!
Dave

[Dave M]

I don't have an investing philosophy, really, except to save or contribute all I can, legally. I try to make a positive contribution to our site, to help all to multiply. This my account has done but I see now it was good fortune more than anything. As soon as the market turned sour I reverted from calm assurances of long term prospects, to nervous short term measures. Adversity helps to reveal; I have gone to the G-fund where I will remain until I feel confident once again.

For the year, at the end of June, I will have a total change in NAV of 14.7%, of which 6.2% is contributions and 8.5% market gain. (This will show as ~8.0% on our tracker.)

It is a good year's worth, about four times as well as I did all last year. So maybe now is a good time for me to let the TSP rest. It is hurricane season again, and last year was a nightmare.

You know I worked them all, I'm one of the idiots they pay well to remain behind. I spent today with a chain saw clearing foliage to reduce the windage, get that out of the way, a bit of sustainable logging of the property. Investment-wise, hurricanes bring uncertainty which we abhor.

Good luck, everybody.
Dave

[Dave M]

June is behind us, and what a month! By the 16th it was down 3.3% and on the 30th it closed up 0.2% so it was what you call volatile. (All-stocks index)

I missed most of the downer and most of the up as well, by sitting in the G-fund. I came out for one week and made a little bit. For the month I estimate 0.83% gain.

This means a gain of 8.3% YTD. With contributions of 6.3% it adds to change in NAV of 14.6%. In raw dollars my TSP account is out-earning my Keys Federal CU account, and stands at 2.5 times my gross income for 2005. I'm shooting for 4X but I keep getting raises, heh.

Dave

[Dave M]

So now the question is, "How confident are you, Dave?"

The Fed met and the world breathed a collective sigh, a gust, of relief. No one I saw heard or read expected the euphoria, the exuberence. Altogether the indices are back where they were a month ago, which means they are also back where they were around March 15th.

So we have made up about half of what we lost. What about that other half? I don't believe it was lost, as such. That is, it exists mostly on paper. For example I sold on May 15th, four days after my account peaked. When I sold I was well below that peak and so took a "loss." But when I sold I was also above where I was when I bought, so I actually made a profit.

In other words, there is a lot of money out there. Somewhere I read that $5 trillion left the market after absorbing a $2 trillion paper loss (as above). That leaves 3 out there somehere. Assuming half of it came back Thursday, in the quick-draw world of Wall St, we still have more to go. Maybe some is tied down in other investments now, but not much because look at real estate, the bond market, whatever -- no sign of large capital inflows.

Since the whole world seems to agree, I am joining the herd and will spit in the ocean in July. But I shall wait for the 5th. On Monday the 3rd I will put in an IFT. I will go in a step at a time. I feel no particular pressure so my thought is, weekly increments. By the end of the month I should be about 50% invested. This will also give the markets a chance to stabilize further, and maybe define the new trend, before I am committed.

I will post the move in other thread. Right now I'm thinking 7-7-7 CSI, and go from there based on performance.

Good luck everybody.

Dave

[Dave M]

I will be 67G 11C 11S 11I for this week. I'm still looking for some performance so I can discriminate between the funds. So far there is not much to go on so I will continue to steer the middle ground.

Good luck everybody,
Dave

[Dave M]

Here are the data from my Q2 statement.

Change in NAV = 5.3%<br>
Contributions = 2.8%<br>
Earnings = 2.5%<br>
YTD = 14.6%, 6.2% contributions and 8.4% earnings.

For the year so far, the I fund has contributed about 60% of the total earnings, more than all the other funds combined. I consider the 2.5% gain for the quarter a minor miracle given that the all-funds index fell by about 1.4% from 5121 to 5051. Still, this was only about half of the gain I achieved in Q1, so I am looking for improvement here in Q3 to get back on track.

Good luck, everybody.
Dave

[Dave M]

Over the last year or four consecutive quarters, I have a change in Net Asset Value of 27.3%. Subtracting all contributions leaves 14.4% as market earnings.

NAV has averaged 6.8% per quarter, with earnings 3.6%.

Q1 '06 was outstanding with about twice the normal rate of gain. (This made up for Q1 '05 in which I lost an amount equal to the overage.) By smoothing that out I can come up with 2.5% per quarter as a more representative average earnings rate.

I have 8.3% for the first two this year but that should be reduced by a third as above, for a representative average of 2.8% per quarter since Jan 1, 06. This still puts me slightly ahead of the rate calculated above, 2.5%. It has been a very good year for me, so far.

Two percent this quarter, Q3 '06, will maintain. It would also put me at about 10.5% YTD on October 1st. Check back and see how I did.

Good luck everybody,
Dave

[Dave M]

The prices for today's action have been posted. The C-fund wins the prize for the week so far. Therefore when I adjust my allocation tomorrow or Monday, I will be adding to the C -- 61G 17C 11S 11I looks good right now.

I will post the actual allocation in the other thread.

Dave

[Dave M]

Now is not the time to increase my exposure, I guess. So I will ditch the big losers and buy some C-fund. Maybe I ought to try the allocation 67G 19C 7S 7I. Hmm...

Dave

[Birchtree]

Why not try 67C and 19G? Snort.

[Dave M]

Incurable, aren't you? I'm not playing catch-up, I'm still defensive and only looking for a piece of the action. So I went 67G 19C 7S 7I this morning. This allocation should damp out some of the mood swings plagueing us lately.

My reasoning is not complicated. World markets are vacillating due to geopolitical events and the I-fund has suffered a lot lately. The latest incremental rise in interest rates seems to have suppressed the S-fund. Our domestic economy seems to be chugging along nicely so it looks like the C-fund is the best place to find positive results. Also when there is a slide, C-fund slides the least.

Did I mention that the I-fund produced 60% of my market gain over the last four quarters? It would seem advisable to have some money, at least, in that fund.

Good luck, everybody.
Dave

[Dave M]

July was another month like June: lots of big movements both ways but little or no change in the end. There is money to be made by the swing-traders but it takes a special skill and lots of luck. Lacking both, I shall abstain as usual.

For the month as of Friday I estimate I had lost a total of $48. This is zero to several decimal places, percentagewise. Therefore my YTD figure remains at about 8.4%, which will show as 8.2% on the local tracker.

That is a real nice number, but it was all made in the first four months of the year. For May, June and July I gained less than 0.5%. I am grateful not to have suffered any significant losses during these difficult months, however the trend indicates that 2006 has cooled off a lot.

It still looks like a good time to be only partially invested. The earnings news is mixed with some sectors, like energy, doing well and others, like construction, beginning to hurt. The interest rate/currency wars continue, with competitive revaluations by the central banks. The geopolitical worries proliferate. We await a series of disasters, natural or man-made.

In other words I see downside pressure on all sides. I am being patient and careful this summer; perhaps by October things will change.

This week I will receive a contribution. On Friday I will evaluate, but my intention at present is to rebalance to 67G 19C 7S 7I which I will post in the other thread at the time. I don't expect skyrockets in August; I'll be delighted to net another 1/2%.

Good luck everybody!
Dave

[Dave M]

Well, the 31st turned me around. The G-fund paid a penny! That turned my -$48 into +$45 for the month, hey hey hey.

My contribution arrived yesterday, we had a little positive action today, and we inch closer to next week. I am still leaning toward getting out Friday morning. We have the Fed meeting, a hurricane, high oil, make your own list. Nnuutt, I may join you in the G-fund!

Dave

[nnuut]

Good, the more the merrier. It's lonely and broke down here!:(

[Dave M]

I saw no reason to wait for 1145 AM to pull the trigger, and went 100G this morning already.

Today's very positive action -- if it holds to the close, still distant -- sort of takes the wind out our sails for next week: this is the bounce that would have come after the FED pauses, should it do so.

So, I shall take a wait-and-see attitude. Will the gamblers win? Stay tuned.

Good luck everybody!
Dave

[EW_ret]

Dave, I like your IFT moves because they are aligned with my conservative stance. I rarely move more than 60% into equities, and went to 100% G on Wednesday. Do you perform your own technical analysis in determining the unusual fund allocations? It appears you are using some prime number sequence over the last quarter, but you remained in a fixed fund allocation in the first quarter of this year.

I'm awaiting a big market correction that's suppose to happen over the next three months. Are you expecting a market correction which completes the 4 year market cycle? Some say we already had this correction the last few month. Others say we are about to enter a big bear market cycle lasting ten years.

I'm not going to chase this market up at this point. My strategy is to wait for a pullback below 1250 in S&P 500 before moving a small amount from G to equities (20-40%). If the S&P 500 should move below 1200, I would increase my equity position further (45-70%). If it should go below 1160 I would then increase the equity position (75-90%). I hope it does not fall below 1200.

[Dave M]

Technical analysis? No, not at all in the sense you are suggesting. I go by feel notwithstanding my scientific background.

2005 was a learning year for me. Q1 '05 I lost my shirt by trying to be smarter than the market. When I looked back, I saw that I did best by setting my allocation and not messing with it. The reason? By timing I missed too many of the up-days; the only way to get them all was to remain invested. The strategy was based on the assumption that the total up would out-weigh the total down. In Q3 '05, Q4 '05 and Q1 '06 I sat tight and did very well.

Q2 this year the strategy faltered but I got out on May 15th with minor losses. Since then I have been trying to protect my YTD gains, pure and simple. I am still waiting for the time to put it in and let it ride. All the gyrations keep putting me off.

I am conservative only comparatively. I have a specific dollar-goal in mind, to reach in 2010 when I retire. So long as I am on track, and I have it all graphed out, I am happy.

My risk tolerance is about 67%; I'll always keep some back. (When I was up to 85% I was being very bold.) I will spread it among the funds so that whichever does best, I have a piece of it. Once I stabilize, I will merely rebalance monthly. This assures that earnings will be in proportion to the allocation, and is the heart of the thing. And yes, for fun I use prime numbers. Do you think I should revert to perfect squares? (1,4,9,16,25, etc.)

You are already retired, yes? That makes it important for you to protect yourself. In my case, the TSP is about half my nest egg, very important for me. BTW, I see you over at fedsoup occasionally. Thanks for reading.

Dave

[EW_ret]

I am conservative only comparatively. I have a specific dollar-goal in mind, to reach in 2010 when I retire. So long as I am on track, and I have it all graphed out, I am happy.

My risk tolerance is about 67%; I'll always keep some back. (When I was up to 85% I was being very bold.) I will spread it among the funds so that whichever does best, I have a piece of it. Once I stabilize, I will merely rebalance monthly. This assures that earnings will be in proportion to the allocation, and is the heart of the thing. And yes, for fun I use prime numbers. Do you think I should revert to perfect squares? (1,4,9,16,25, etc.)

You are already retired, yes? That makes it important for you to protect yourself. In my case, the TSP is about half my nest egg, very important for me. BTW, I see you over at fedsoup occasionally. Thanks for reading.

Dave

Yes, I retired from the US Navy under the CSRS last September. I've become quite conservative in my investing. It started when my retirement date was about six months away.

I have most of my assets at Vanguard. I am now sitting at 40% Stocks, 12% Bonds, and 48% Cash for all my accounts. I await the markets to drop before moving to a allocation of 60% Stocks, 30% Bonds, 10% Cash. This is the target allocation of my investment plan. I did an IRA rollover in April 2006 from TSP to Vanguard with about 80% of my TSP funds. I kept a small amount in my TSP account to play the markets. I agree with you that moving funds frequently hurts your return, but I enjoy the excitement. I recommend to everyone still working to just invest in one of the Lifecycle funds and forget about it. The majority of federal workers don't have the time to manage their accounts.

Yes, I frequent the FederalSoup forums. That’s where I first heard about TSPTalk. I try to help those with retirement questions if I can.

[Dave M]

Before I joined the federal service I opened an IRA. Since contributions to a 401 at work meant that contributions to an IRA were no longer tax-deferred, I quit contributing to it a long time ago. Thus it has been sitting there quietly accumulating since about 1985 -- a T-bill and some mutual funds.

I, too, planned to roll my TSP into the IRA at some point. But then, the TSP is so easy, and so inexpensive, and gives such good results, that now I am not so sure. I may just close out the IRA, take the cash for my first year's living and traveling expenses, and let the TSP cook. The balances will be in 10-1 ratio in 2010, approximately.

So anyway, are you happy you flipped it? Maybe playing with the residue is what makes you happy?

Dave

[Dave M]

Today I bought an imaginary 10,000 shares of I-fund. D

[Birchtree]

You are too timid - 30,000 would set you straight. And you'll be there someday. Good to know you and your style.

[Dave M]

A tenner is my present limit. I came oh, so close to making it real today, based on the false down-move due to the terrorists, which will correct itself tomorrow. It will, won't it?

Dave

[Dave M]

I'll give it a try this coming week. 79G 7C 7S 7I at today's close. D

[Dave M]

Well the imaginary tenner was a great move, worth almost $6000. Should I let it ride? *smile*

In the real world, I added two increments and will enter next week at 61G 11C 11S 17I.

Good luck everybody!
Dave

[Dave M]

Here is a look at the index C+S+I times 100, the sum of the fund prices without the decimal point. I track it weekly.

Dec 30 4741
May 5 5347
July 21 4847
Aug 18 5131

By mid-May we had achieved a 12.8% gain.Then came the Bernanke Panic which cost us over 80% of that. We bottomed in July and since then have recouped another 50%. We now stand at 8.2% for the year.

That means that buy-and-holders who invested 100% evenly across all three funds and just closed their eyes, would stand at +8.2% for the year. Considering new contributions and resulting favorable buying opportunities, the figure is closer to 9%.

I was 65% invested through mid-May, and probably less than 20% on an average daily basis since then, as I have been in and out a lot lately. I estimate my return at 9.5% for the year as of the 18th which the tracker will show as nine and a fraction.

Buying and holding is approximated by the line for "Total Market" on our tracker, and it will be in the Top Ten tomorrow. We should all consider our moves very carefully.

Dave

[Dave M]

I ordered the allocation 61G 13C 7S 19I this evening, which will go into effect at tomorrow's close and so be my position for next week.

The S-fund has underperformed lately so I decreased from 11S to 7S and gave it to the C- and I-funds, while retaining my overall cash position, 61G.

So far August has been better than I expected; let's hope for a strong finish!

Dave

[Dave M]

August is in the books. I was in the G-fund for the first two weeks of the month, then gradually increased my exposure to around 40%. For the month I earned 1.0% almost exactly. This increased my YTD figures to 18.6% NAV, 8.4% contributions and 10.2% earnings, which will show as ~10% in our tracker.

That's good money. Through PP15, my TSP account is matching my net pay. I plan to make only minor adjustments in September unless something drastic happens.

Good luck everybody,
Dave

[Dave M]

Oil is down, gold is down, peace is up -- and the market is down? Oh, well. Perhaps it was programmed trading. In any case I bailed today to the Safety Zone. Fortunately today's losses were minor. I will sit out the weekend and re-evaluate on Monday.

Dave

[Birchtree]

If you want to stop a train - step in front of it. Works every time.

[Dave M]

Be my guest, my friend. It takes many miles to stop a train.

I am very happy with the results of my various moves so far this year. What I felt to be true, has been quantified by Rokid the Enumerator. My rewards have been substantial in absolute terms as well as in the relative. The strategy has been to establish the level of risk, buy up to that point, and then let time do its work. Since May the tactic has been to re-evaluate the risk on a weekly basis.

Discounting the funds themselves, YTD returns have placed me in the top ten pretty consistently since then. The associated risk is among the lowest by all measures and that is very important to me, as you can see from my profile that my ETS is approaching fast.

Still, I have to hand it to those who have successfully outperformed the rest of us. Fundsurfer, Show-me, Wheels, Ebb, et al, somehow you have managed consistently to beat the odds. I am considering a method whereby I could incorporate your moves into my own.

For instance, I see ~60% as my natural risk level, which monies I typically spread among the funds. Perhaps half the remainder might be allocated in step with your own. So for example if I was to be 40G 20C 10S 30I, and you guys in the aggregate go for 100I, then I might put another 20 into the I fund and end up at 20G 20C 10S 50I. See what I mean? Any comments?

Dave

[sugarandspice]

I am very happy with the results of my various moves so far this year. .................................................


Any comments?

Dave

Someone will always be doing better, so would this new strategy be motivated by greed?

[Griffin]

Someone will always be doing better, so would this new strategy be motivated by greed?

S&S, what is the issue with greed?....why does trying to maximize your investments equate to greed. Is a healthy diet - glutony? or taking a vacation - sloth? What are you getting at?

[nnuut]

Ha, Greed is Good!:D

[Dave M]

The point of our mutual exercise is to learn from one another. I propose to act upon my new knowledge. It would seem to be the course of least risk to adopt those methods proven to be efficacious. My effective risk would remain ~60%, yet my return could be augmented by a third. Thanks for reading. Give me more feedback.

Dave

[sugarandspice]

S&S, what is the issue with greed?....why does trying to maximize your investments equate to greed. Is a healthy diet - glutony? or taking a vacation - sloth? What are you getting at?

Why deviate from what is working and you are happy with? Dude, you need to stop jumping to conclusions. Maximizing your investments is fine as long as you are using sound methods. But when you start deviating from your strategy(that has been working) for no reason other than someone else is doing it seems reckless. I will say that the proven track records of the people he will follow seem to be something to bank on but everyone will fall sooner or later. How far depends on how long you ride it out. Stick with what's working for you.

Has anyone here just copied Fundsurfer to maximize their profits?

And Gryffyndor, you seem to be assuming that I think greed is a bad word. For the right reasons being greedy is very appropriate.

[Birchtree]

I have.

[Griffin]

Dude, you need to stop jumping to conclusions.

And Gryffyndor, you seem to be assuming that I think greed is a bad word. For the right reasons being greedy is very appropriate.

Dudette, I'm just curious as to why you consider good management = greed. This isn't "Wall Street" - none of us are squeezing the life out of the poor and underpriviliged.

The reason I ask is I don't think of myself as a greedy person, in fact, I'm actually happier by the fact that I don't feel the need to drive a Porsche and live in a 4000 sq ft home (and neither does my wife, which is probably why I'm really happy about it :D ).

PS: Mrs Ravenclaw :nuts: - I don't want to hijack Dave's thread any further, but I do want to hear this....get back to me elsewhere.