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I'm not sure why you indicate that this conservative, diversified (20 stocks -
four asset classes) strategy that only buys once a year hasn't work so well.
The page you refer to shows a YTD gain of 8.5% on the total stock portfolio,
while the Dow and NASDAQ have declined over the same period. We have a similar
strategy with mutual funds that has done about the same and we're quite happy
with it, given the 12 month hold constraints (for tax reasons) and this year's
stock market volatility. It's not the double digit gains of some of our more
active strategies, but given the limitations it seems like quite good results on
both a total return and risk/adjusted return basis. How do you define "working"
?
Jerry Wagner
Flexible Plan Investments, Ltd.
http://www.FlexiblePlan.com
http://www.strategicsoltn.com
http://www.annuityprices.com
http://www.marketsavi.com
Past performance does not guarantee future results. The opportunity for profits
carries with it the possibility of losses. A complete list of all of our
recommendations over the last 12 months is available upon request.
Gitanshu Buch wrote:
> > I have been on this list for quite a while now and have noticed that
> > the only traders that post their trading results are those that are
> > trading mechanical systems. Could it be that discretionary non-
> > mechanical trading is a losing game?
>
> It could be that discretionary non-mechanical trading
>
> - is indeed a losing game for most of us
> - is too time-consuming to bother with mundane things keeping score...
> - is full of boom-bust blow-hot, blow-cold types of cycles, which can
> stretch out for years/months
> - is populated by trader types that have nothing consistent to offer since
> they adapt to the changing market instead of sticking to the rigors of a
> locked in machine
> - is better than most mechanical systems, but who cares, as long as both
> make money to their constituents...
> - is no better or worse, since most non-discretionary systems are based on
> discretionary rules of analysis that could lead the investor astray if its
> assumptions didn't pan out for some reason
> - still depends on the investor, to stay with it through the long periods
> needed to really justify greatness.
> - is no better than indexing in the long run.
>
> An example of a mechanical system that isn't working so well this year after
> a few years of admirable results can be found here:
>
> http://moneycentral.msn.com/articles/invest/models/yeartrader2000.asp
>
> As they say, the year ain't over until the last pitch is pitched.
>
> Regards
> Gitanshu
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