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Subject:  Re: What to do with a losing IRA Date:  11/26/2004  6:37 PM
Author:  joelxwil Number:  43285 of 93723

It is not clear to me what sort of an IRA you have. What you need, however, is an IRA with a brokerage company like Brown, Ameritrade, or Scottrade. Then you can do anything you want with the money except for short sales and some kind of options transactions.

I cannot imagine holding the same fund since February 2000. We went into a major bear market in mid-March, and prudent people sold around that time went to cash or perhaps to short funds like USPIX, which you can buy in an IRA. Most funds have not gone recovered to go back to the highs of March 2000, except for some notable exceptions like RSPFX, ARGFX, RSCOX, OAKLX, SCUIX, PBFOX, and some (perhaps all) REIT funds. That is not a complete list. Gold and natural resource funds have done well, but only for the last few years. Index funds like VFINX are still under water, of course, but that is to be expected from an S&P index fund.

If you want to make serious money in the market, you have to time the market. There are a number of good timing systems, such as TimingCube, and a number of free systems on my site, and an archive of stuff, mostly for timing, at Dexter French's site. This approach has certainly worked for me - I have vivid memories of selling stuff in March 2000 when I was staying at a Red Roof Inn on a business trip to Colorado. Have not been to one of those since.

Timing the market just means following the trend, and there are a lot of good trend-following systems. These systems will generally trade 2-4 times per year (that is go from buy to sell status). Nothing is perfect, but if you look at TimingCube's record you can see that it has done very well compared to buy and hold.

People scoff at this sort of thing, but I just laugh all the way to the bank. If I had listened to the people who say you cannot time the market, I would still have to be working for a living. When I started at this stuff, I had only the most rudimentary tools and knowledge, but even with that I certainly could spot the major trends.

The second aspect after timing is selection. The easiest thing to do is to trade funds like QQQ (soon to be QQQQ), SPY, and IWM. There are also some other things you can do, of course.

There is absolutely no such thing as a good long-term buy-and-hold investment. Even an excellent fund like HSGFX looks terrible some times.

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