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Investing/Strategies / Retirement Investing
|Subject: Re: S&P & SMA||Date: 5/4/2013 7:34 PM|
|Author: Rayvt||Number: 72194 of 79818|
Perhaps I don't understand the strategy, I count 3 dips of the S&P below the 200 day SMA in the last 2 years alone.
First off, I don't use 200-day SMA. I use 43 weeks or 10 months. I evaluate only weekly, not daily. For monthly, I do it on the last Friday of the month, not the last calendar day.
And I use hystersis. Normally, my sell signal is a close 3% below the 43-week SMA. If you use 0%, then you get a flurry of signals right around the crossover point.
Here's the counts I get, 1/1/50 to 3/15/13 (all round-trip trades):
daily, +0% & -0% (buy & sell): 177
weekly, +0 & -0: 95
weekly, +0% & -3%: 39
monthly, 0/0 and 0/-3: 47 & 45
Why can't I back test it? The logic is simple to implement using historical data. In fact I did back test it and it did improve returns over a straight 60/40 balanced portfolio.
Maybe you can backtest it. I looked at your criteria and thought it had too many subjective pieces. The market does what the market does, and whether or not you've bought or sold anything in the last 3 months doesn't enter into the picture.
I just has the feel of what I was attempting to do many years ago. I eventually discarded it because it was just too subjective. I generally try to write down the concrete steps of any method I'm considering, as if I was going to write a program to implement it.
That's a great way to find out if there are any holes