1 / 24

Tactical investing

Tactical investing . when to enter and exit the market. disclosure.

sylvia
Download Presentation

Tactical investing

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Tactical investing when to enter and exit the market

  2. disclosure • The investment club and its speakers are not investment professionals. We provide information solely for educational purposes and the approaches presented may not be right for you. Any investments or techniques mentioned are for only illustration, not recommendations. Investing involves risk so educate yourself before you invest.

  3. Your speaker • Eric Richter • Sr. Engineering Specialist • Product and Process Assurance Department • Qualifications: a person who is playing investing catch up and probably has made every mistake he could. Yet he still is on the way to having a modest retirement account.

  4. luck • For many of us, making money in the stock market seems to depend as much on when we were born and when we started investing as it does on skill.

  5. When did you start investing? Subprime Mortgage Crisis of Of 2007-2008 Dot Com Bubble Of March 2000

  6. We don’t control our birth… • But we can control when we invest or not invest • Most likely during our investment years we will experience a significant market downturn • And it is likely we might not recover sufficiently to meet our investment objectives

  7. Rather than buy and hold or count on diversification… • It might be better to get out of the market or switch to safer investments when the market is crashing and wait for a better day to enter the market

  8. Predicting a market crash? • Is it even possible? Aren’t the markets random? • The S&P 500 pattern shown earlier doesn’t look random.

  9. But could you see a one day drop? Subprime Mortgage Crisis of Of 2007-2008 Dot Com Bubble Of March 2000 Black Monday, October 19, 1987 Investors lost almost 30% their money in a single day in 1987 and no one saw it coming. Later we’ll see If there was a warning sign.

  10. What can you do? • Be aware of what the market is doing each day. Get an app for your smart phone that will give you the percentage change of the market. • Monitor your accounts at least once a month. Are you making what you expect?

  11. Understand your options • How fast can you react if the market drops suddenly? If you react too slowly, you will sell low and buy high. That’s not good • Ask your financial advisers and money managers what they do with your money when signals turn negative

  12. Review our newsletters monthly • Vanguard Independent Adviser – usually bullish and still is • Bob Brinker Marketimer – usually bullish but has been cautious about adding money to the market since the beginning of the year • Blue Chip Growth – usually bullish and still is

  13. Review investors business daily (ibd) Found in Section B of the paper

  14. Review investors business daily (ibd) Found in Section B of the paper

  15. Delta market sentiment indicator Usually 50% is the cutoff, but they’ve employed a 3% discretion. Options expiration just occurred on 3rd Friday Sign up for free weekly emails of this indicator at www.deltawealthaccelerator.com

  16. What about other investors like us? The typical AAII member is a male in his mid-60s with a bachelor’s or graduate degree. AAII members tend to be affluent with a median portfolio size in excess of $1 million. The typical member describes himself as having a moderate level of investment knowledge and engaging primarily in fundamental analysis. Join American Association of Individual Investors at www.aaii.com for $29 a year. Attend some AAII meetings.

  17. Using simple moving averages as indicators To get simple moving averages, go to www.finance.yahoo.com Enter a stock or ETF like SPY in the quote lookup box and on the chart click on 1y.

  18. Golden cross or death cross indicators The idea is when the fast MA (10 period) goes below the slow MA (40 period) that’s bad (death cross). When the 10 period moves above the 40 period that’s good (golden cross). Some use a 50-100 day moving average but that may be too slow.

  19. The 75 day moving average is even simpler Dot Com warning Exit on red arrow. Re-enter on green arrow if other indicators support the move. NOTE: This method works best on an index rather than an individual stock

  20. Several exits for the subprime mortgage crisis It is better to use the equally weighted RSP rather than the SPY. Once out you might have noticed lower lows and lower highs and not re-entered until the crash was over

  21. The black Monday warning

  22. Comparison of techniques/opinions

  23. Tactical takeaways* • Focus on avoiding major losses rather than chasing gains • Make decisions on a suitable timeframe, a week to a month • Do not move incrementally • Use a repeatable, systematic, and disciplined method for making tactical decisions • Hold your tactical investments in tax deferred accounts *Win by not losing by Nicholas Atkeson and Andrew Houghton

  24. If this talk seems helpful… • Consider joining the investment club. It’s only $12 a year. Contact Joe Barger • Here’s what we provide: • Access to newsletters • Investment books for loan • Discounts to selected events • Software for review

More Related