Thread: Steveg's Account Talk

buying shares as the market prices go down is cost averaging.

it would seem that sell portions on the way up (once above your cost average price) could be a way of value averaging and getting some gains.

you could set a price that once above it, you dont buy any more shares and you sell off a percentage every so often. Once below your target price, you could move in to the fund a percentage every so often or all at once.

moving all in and all out has a risk that your market timing would be off, dealing with smaller percentages would reduce the risk, realize some of your gains on the way up, but would limit your total gain because you would be selling off part of your shares before it peaked.

**this sort of makes sense to me, maybe someone with more knowledge can share there insight**

Yeah, Turbo, this is somewhat confusing.

So, tell me why you did what you did. You went 97% G, then 1% C, 1% S, and 1% I? Is the idea here that if C, S, and I go down, then due to simply the loss of shares due to the price decrease, you could end up with, say, 99.1% G, .33% C, .33% S, and .33% I? At that point, you could then "buy" .67% more into C, S, and I, by doing an interfund transfer and returning your balances to 97% G, 1% C, 1% S, and 1% I? Is this correct? So essentially, you could buy 2.1% stocks, to take advantage of a price fall?

Steve

Originally Posted by steveg

Yeah, Turbo, this is somewhat confusing.

So, tell me why you did what you did. You went 97% G, then 1% C, 1% S, and 1% I? Is the idea here that if C, S, and I go down, then due to simply the loss of shares due to the price decrease, you could end up with, say, 99.1% G, .33% C, .33% S, and .33% I? At that point, you could then "buy" .67% more into C, S, and I, by doing an interfund transfer and returning your balances to 97% G, 1% C, 1% S, and 1% I? Is this correct? So essentially, you could buy 2.1% stocks, to take advantage of a price fall?

Steve

You're starting to get the idea. The <1% allows you to stay in the market after you have used up your 2 IFT's The percentages in the funds depends on your comfort level. I am still playing with the numbers on the side but less than 5% in any of the funds has less risk and still allows you to increase your shares. Good luck.

Originally Posted by steveg

Yeah, Turbo, this is somewhat confusing.

So, tell me why you did what you did. You went 97% G, then 1% C, 1% S, and 1% I? Is the idea here that if C, S, and I go down, then due to simply the loss of shares due to the price decrease, you could end up with, say, 99.1% G, .33% C, .33% S, and .33% I? At that point, you could then "buy" .67% more into C, S, and I, by doing an interfund transfer and returning your balances to 97% G, 1% C, 1% S, and 1% I? Is this correct? So essentially, you could buy 2.1% stocks, to take advantage of a price fall?

Steve

The inverse is also true. If your 1% CS&I then become 1.01% each you can increase them to 2% each. Then 2.01% can become 3% and so on. This helps in the infrequent bear rallies when you have used your 2 IFT's.

Steve, Nasa has requested that I comit to a seperate thread on the
topic of <1%IFT's. I agreed to do this as soon as possible. From what
I've read in your thread, your in good hands. Stay Tuned !

I'd wait to get the deal straight from Squalebear.

Rich

Steve,

I've enjoyed your posts immensely !!

Thanks for being an active part of the MB

Steady

Steve here my <1% (2 cents). I did some back testing of the <1% strategy and posted it on SB's and my own thread on 1/16. It may answer some of your questions on strategy. In my mind the goal for any <1% strategy is to make enough to beat the G fund. SB/Nasa, I think a <1% thread is a awesome idea.

Here's what was in the post:

I ran several 2 week scenarios for performing <1% IFTs from different periods throughout the year and the following are my findings. Most of this has already been posted by SB on his page. All my calcs were done using C fund data for stock trends.

Disclaimer: Remember folks I picked the periods from past history so the market did what I wanted. I am not a financial consultant or broker or any other financial professional. These are my interpretations of the results provided to you should you decide to experiment at your own risk!!

Downward trend market: I used initial allocations of 50% C, 15%C and 5%C. In all 3 senarios I performed <1% IFTs on down days to maintain allocation percentage which DCAs increasing shares. Up days no IFT was performed. The goal was to attempt to dollar cost average intial purchase price to break even sooner on the rebound.

The 50% and 15% scenarios did not reduce dollar cost significantly to warrant the moves. If you are expecting the market to go down G or F ruled in the past year. The 5% scenario did reduce the DCA significantly but I can’t come up with a real chain of events to make it useful. Going to G makes more sense to me.

I also ran some scenarios selling profits back to G on up days back to the initial contribution. While it did reduce to loss amount it was not significant enough to warrant staying in stocks. JMO folks.

Bottom line <1% IFTs into stocks is not real useful during a downward trend market.

<1% IFTs into F fund was 70% positive results. So in the future of this bear market, my first IFT of the month is going to have a 5 percent into F. What worked best was a combination. Down days IFT back to the previous percentage . Up days hold and the following day go up to the next percentage. Last day of the month sell back down to the original percentage or all so you pocket the profits in G. Lady has already had some success in this area but I’m not sure what her strategy was.

Upward trend market:

I used similar strategy as with the F fund. Accumulating shares on down days and moving up percentage following up days which also accululates shares. You would only use this if you found yourself in a rally period and no IFTs left. If you are stuck, <1% IFTs can help you beat the G fund. My scenarios beat G about 60% of the time and F about 40% with 5% in C. Any less than that and the dollar value for % change wasn't enough to beat G consistently. That being said I was running these models using past performance so I knew the numbers would go up. In real life you will have to risk a downtrend and possible loss.

Thanks for the kind words, Steadygain!

Steve

Everyone --

Thanks for this insight on the <1% thing. If squalebear or nasa start a thread, I'll enjoy reading it.

So you can do these "less than 1% moves" indefinitely, there are no limits to how many times you can do this in a month?

Steve

Originally Posted by steveg

Everyone --

Thanks for this insight on the <1% thing. If squalebear or nasa start a thread, I'll enjoy reading it.

So you can do these "less than 1% moves" indefinitely, there are no limits to how many times you can do this in a month?

Steve

One a day to round up or down. I think they might have left the ability to allow rebalancing or it is just a weakenss in the computer program. Either way .01 to .99 rounding to the next whole number. You can use it to make a little more than G and it could add up over the course of a year.