ContrarianJeff's Account Talk

[Birchtree]

My take away from your posted article. "It's about sitting with discomfort and being at peace with it. The market rewards what is hard to do." I made significant dollars off that March 9th low and I plan to make a lot more.

 

[crws]

One of the fund managers I saw on NBR said he believes the risk to reward ratio of equities warrants being actively invested, because of the current lack of interest in fundamentals.
A transition signifying a more robust job growth outlook could quickly turn the market upwards.

 

[coolhand]

But if sentiment turns with it, we could tank.

One of the fund managers I saw on NBR said he believes the risk to reward ratio of equities warrants being actively invested, because of the current lack of interest in fundamentals.
A transition signifying a more robust job growth outlook could quickly turn the market upwards.

 

[crws]

But if sentiment turns with it, we could tank.

nation of whiners, nation of doers .....? The 64 billion dollar question.
Do we get back to the business of leading the world in innovation, or do we tuck our tail and go to the corner until China tells us we can come out, flogging each other in the meantime. 10/2/10 -a day to remember.

 

[coolhand]

I think you're trying to equate the market with being an economic barometer when in reality it's a casino. :laugh:

nation of whiners, nation of doers .....? The 64 billion dollar question.
Do we get back to the business of leading the world in innovation, or do we tuck our tail and go to the corner until China tells us we can come out, flogging each other in the meantime. 10/2/10 -a day to remember.

 

[crws]

I think you're trying to equate the market with being an economic barometer when in reality it's a casino. :laugh:

sorry, a momentary lapse snuck out.
rum & coke please
-lots of rum

 

[love-to-bike]

Jeff - I've been a follower of your moves for a couple of years, glad to see your standing - outstanding! For the last month or so I've been eager to see if I can claw upwards and catch up to you, for the first time I'm in the top 5 and slowly inching up to your spot. Wishing the both of us continued success!:nuts:

 

[Birchtree]

love-to-bike,

Look over either shoulder - see that distant dust cloud forming. Those are bulls on your trail. Wouldn't you feel safer in the G fund like Jeff?

 

[Devilduck]

Birchtree your comments make me laugh, much thanks. I enjoy the steadfast bull-rallying, now let's see if they can find the corral. :laugh:

 

[love-to-bike]

Well to be honest, when I look over my shoulder mostly what I see is not a cloud of dust from bulls but a cloud of bullshlt! Moving in & out of the various funds keeps us in double digits. Last year I hit 33%, I'm hoping for at least 25% this year.

 

[Birchtree]

Well you have been consistent with your moves to the lily pad - congratulations on your profits.

 

[love-to-bike]

Thanks - mostly luck but I keep an eye on what certain people in the herd are doing, that's worked well for me.

 

[Blindman]

Great Job LTB! I enjoy reading these posts from ALL!

Top Ten - Nice returns fellows!! Sure getting tired of setting in this Dust Cloud!! Oh heck, what was that I just stepped in!!! BIRCHTREE!!

Even ole Birch has passed me on the tracker!:laugh:

Thinking we may see a little hesitation (sideways action) next week or maybe even a slight pull back now that we hit 11,000..???..Just my nickels worth! GL Everyone.

Blindman Out

 

[KevinD]

It's been a while since I've posted (because I really have had nothing to offer). I've read many different ideas about investing (here and many other places), and I always enjoy learning. In that spirit, I thought I'd share something that has been helpful to me in this whole investing/market/timing issue. File this under "take it or flush it."

My investing practice starts with identifying a default position, and that is determined by whether we're in a bear market or a bull market. There are many ways to define this, but I simply use the slope of the 200 day moving average. If the 200 dma is up, then we're in a bull market. If it's down, then we're in a bear market. If we're in a bull market, my default position is equities (doesn't really matter whether it's C,S, or I--they all move together). If we're in a bear market, my default position is cash or bonds (G or F, but usually G). The only time I'll move out of the default position is if a lot of indicators that I use (risk/reward ratio) are pointing to a move opposite to the current trend (i.e., bull or bear). I only stay in that countertrending position for a short time, and then I go back to the default position.

For example, right now the 200 dma is still sloping down and it has been for all of 2009, so my default position is G (or F). I have only been in equities for a total of 31 calendar days in 2009 (out of ~207 calendar days). This means that my risk is very low. Of course, I will miss many big up days, like today. But it also means that I will miss many big down days. (My return so far in 2009 is 19.5%.) When the 200 dma begins sloping upward, I will return to C, S, or I as my default.

The "buy and hold" and the "dollar cost averaging" methods just don't produce meaningful gains unless we happen to be in a strong bull market. And in that case, everybody looks like a genius. (See here: http://globaleconomicanalysis.blogspot.com/2009/07/another-nail-in-buy-and-holds-coffin.html )
Anyway, I've found that this simple "default" method eliminates a lot of risk, a lot of stress, and my tendency to "fight against the trend." It has helped me tremendously. As I said--food for thought, and take it, leave it or flush it.

Bump :cheesy:

 

[lacaprup]

Bump :cheesy:

That was simple, great advice. I actually passed Jeff last year, but couldn't hold him off for the final (I had a respectable 23.54% to his 24.06%), but I got nailed this year trying to gamble. I'm only up 9.2% and sitting in a woeful 71st place. I guess 9.2% isn't terrible, but I'm, definitely feeling jealous of you folk in the top 20.

 

[MaStA]

That was simple, great advice. I actually passed Jeff last year, but couldn't hold him off for the final (I had a respectable 23.54% to his 24.06%), but I got nailed this year trying to gamble. I'm only up 9.2% and sitting in a woeful 71st place. I guess 9.2% isn't terrible, but I'm, definitely feeling jealous of you folk in the top 20.

It's definitely better than me -13.XX%. Want to swap positions?

 

[Warrenlm]

[dumbquestionfonton]If the system is to follow the 200dma slope, which reflects the trend of the market, why the handle of "Contrarian"Jeff? [dumbquestionfontoff]

 

[ContrarianJeff]

[dumbquestionfonton]If the system is to follow the 200dma slope, which reflects the trend of the market, why the handle of "Contrarian"Jeff? [dumbquestionfontoff]

Good question. I call myself a contrarian because I've found that going against the sentiment of the crowd usually outperforms the market (especially at extremes). That's the contrarian part. But I've also found that long-term momentum--either up or down--is very strong. That's why I don't like going against the long-term direction of the market for too long. So, the ideal situation is a bull market as indicated by a rising 200dma (especially one that is not too long in the tooth) coupled with very bearish sentiment (in other words, people are freaking out). Ironically though, the most "violent" bullish days almost always come in the context of a bear market. There is no doubt that it's tough emotionally to be sitting in cash and while watching the markets shoot up 3% or 4% in a day, as has happened in the past few weeks.

 

[Sensei]

Just in glancing at the annual returns for this year and last, it looks to me like you're the only one in the top 50 both years. In fact, you were 24th last year, and better than that this year. So let's say only one in the top 25. Well done!

 

[JTH]

CJ, you've had an awesome well-deserved and earned year, congrats and thanks for sharing your thoughts.