S&P Sell Signal

Flagpole wrote:

I'd have to see more data than your say so...

I might call that, "Buy Buy Buy Buy Buy Buy...and Hold"...

It's not like I've been sitting on 2 million dollars of stock since 1989...

I like to spend about 80% of what I make

Early on, we invested 50% for 7 years.

That was very helpful and allows me to continue to invest in a solid less risky way. Probably though, if I had to start all over again today at age 45, I would still invest as I do...personality comes into play with investing strategies...mine is SOLID and suits me well.

Count the number of times he uses the words- I, me, we, mine

This thread went six months and 9 pages before Flagpole makes a single post.

Then he takes it over and makes it all about him.

Well, we are talking about our own investment strategies, are we not?

Reality Checker wrote:

Well, we are talking about our own investment strategies, are we not?

Wow! A sense of reason here! Woo Hoo! I KNEW it could happen one day! Seriously, nice post brother.

The thread was about a particular time that was deemed a good time to sell in anticipation of the markets going down.

Then there was debate about the timing of this signal.

Flagpole offered nothing to that conversation.

He veered far from the subject since he never sells and merely used the space to discuss what he his doing, which we already know from several threads.

INCORRECT!

Let's talk about me wrote:

The thread was about a particular time that was deemed a good time to sell in anticipation of the markets going down.

Then there was debate about the timing of this signal.

Flagpole offered nothing to that conversation.

These systems are not discretionary. There is no, "I think that XYZ will occur" involved. You get the signal, and act on it. That is it.

Trend following has better numbers than B&H. Better volatility, better Sharpe ratios, better returns. Everything. This is not in dispute. People can believe the research or not. Investors who have made use of trend following for the past 100yrs or so have done very well. B&H investors have, over the past 20 years, underperformed fixed income.

People take comfort in B&H because it is the market - you can never be worse than the market. So you never have to deal with the idea that you are wrong.

Richard Dennis wrote:

These systems are not discretionary. There is no, "I think that XYZ will occur" involved. You get the signal, and act on it. That is it.

Trend following has better numbers than B&H. Better volatility, better Sharpe ratios, better returns. Everything. This is not in dispute. People can believe the research or not. Investors who have made use of trend following for the past 100yrs or so have done very well. B&H investors have, over the past 20 years, underperformed fixed income.

People take comfort in B&H because it is the market - you can never be worse than the market. So you never have to deal with the idea that you are wrong.

The problem with this statement is timing - now, at point where stocks have had one of their worst 15 year runs ever (by the sp500 anyway if not true for the market as a whole), of course buy and hold is going to look bad. But if this discussion were held in 2000, after one of the BEST 15 year periods ever, I am sure buy and hold would have far, far outpaced any sort of market timing system.

Data on the stock market needs many decades to tell you anything - at least 80 years and more like 100+ years of overlapping periods, etc.

To my mind, for 95% of people, b & h is best over 50 year+ investment horizons. Maybe 5% can manage to stick to a system and make it work, but that would be rare and maybe just lucky.

agip wrote:

To my mind, for 95% of people, b & h is best over 50 year+ investment horizons. Maybe 5% can manage to stick to a system and make it work, but that would be rare and maybe just lucky.

agree. the risk of any strategy is the failure to stick with it. Joel Greenblatt in his book, "the little book that beats the market" says as much. He puts up 30%/yr on average by picking stocks. Why can't other managers do this too? Because the strategy stops working for periods of 1-2 yrs and sometimes 3. People, being people, cannot tolerate that.

The same is true of trend following. 1995-2000 returns vs the benchmark.

there is always a strategy that is "best".

Flagpole wrote:

I'd have to see more data than your say so. Also, "Buy & Hold" can mean a couple of different things. If that refers to individual stocks,...

So the data I've given you on risk isn't good enough for you? What data do you have on the risk of what you're doing? How do you know that what you do isn't risky?

Buy & Hold only means one thing - buy a stock and hold on to it until you sell it because you need the cash. Making periodic investments doesn't change the strategy. You can make periodic investments with Trend Following also, that doesn't change the investing style.

This thread is about the S&P 500, not individual stocks. I'm not suggesting anyone buy stock in an individual company. If you'd read the thread you'd realize that, so there's no point in discussing what would work better with an individual stock. Besides, Buy & Hold sucks when used with individual stocks. Ask anyone who owned GM, Wachovia, Enron, etc.