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Griffin Account Talk
- Thread starter Griffin
- Start date
Griffin said:
I am getting an itchy trigger finger to be sure. And I think I agree with you as far as choosing the S fund as my vehicle for getting back in. Now to pick the day. Had I been near a computer before noon today I might have pulled that trigger. Maybe tomorrow. Take note anyone who reads this, just my saying that may cause a three percent rally tomorrow.
Dave
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Griffin
Well-known member
The topic’s dominating the conversations over the next week are going to focus on a retest of the lows and the possibility of a step down (if a drop occurs). The most likely resistance point for the DWCP is at 585 (I am currently 100% S-fund). Were currently 2.2% away from that point so we probably have a couple of days before this resistance becomes relevant. What I do is always based on what I decide my behavior should be, I think of behavior in terms of aggressiveness.
I think a reasonable assumption is that the economy is going to slowdown for a few quarters, so I am open to the concept that this is the end of the channel of the past three years, and the eventual development of a lower growth rate channel. However, the critical points of the last year will still play out on the development of the market trends over the next six months or so. I say this, because I see May’s highs holding and the possibility of lower new lows. I actually prefer this scenario to the run away markets of the past few months, simply because, I would prefer to make my gains through market timing rather then paying tomorrow’s prices, today in a very aggressive buy and hold strategy – which was where I was at earlier this month.
I break aggressive into three components, Volatility – the need to shift behavioral gears quickly, Urgency – the need to keep up with the market and Risk – exposure to losses. These all go hand in hand depending on the growth rate of the market over the intermediate term (a few months). The highest level of aggressiveness is buy and hold. Short of that, a very aggressive behavior means I am more willing to expose myself to risk in order to compensate for a higher urgency – with the understanding that volatility goes way up. So I am more likely to do things like: ride a top, take some minor losses, buy a dip without a retest etc…but I am also more willing to shift to a capital preservation mode, but only if there is a reason – not speculation.
What I don’t like to talk about is caution. I am always cautious. Caution is not the opposite of aggressive, in fact the more aggressive I get the more “Cautious” I get. I occasionally mention behavior and emotional control. I see caution as an emotional response – not useful for making judgements and it does not factor into my behavior.
So getting back to the first paragraph, I am setting my behavior at a moderate aggressiveness, coming out of this drop. Meaning, more then likely I will go into capital preservation mode if the market bumps up against the 585 resistance level a couple of times. I still plan to stick to my plan from a few days ago of working the S for the next month or so with a shift to the I – especially if the currency trends suggest this, at a later point following a correction. Right now, I am not sure if I bought the bottom and if we are on the way out.
I think a reasonable assumption is that the economy is going to slowdown for a few quarters, so I am open to the concept that this is the end of the channel of the past three years, and the eventual development of a lower growth rate channel. However, the critical points of the last year will still play out on the development of the market trends over the next six months or so. I say this, because I see May’s highs holding and the possibility of lower new lows. I actually prefer this scenario to the run away markets of the past few months, simply because, I would prefer to make my gains through market timing rather then paying tomorrow’s prices, today in a very aggressive buy and hold strategy – which was where I was at earlier this month.
I break aggressive into three components, Volatility – the need to shift behavioral gears quickly, Urgency – the need to keep up with the market and Risk – exposure to losses. These all go hand in hand depending on the growth rate of the market over the intermediate term (a few months). The highest level of aggressiveness is buy and hold. Short of that, a very aggressive behavior means I am more willing to expose myself to risk in order to compensate for a higher urgency – with the understanding that volatility goes way up. So I am more likely to do things like: ride a top, take some minor losses, buy a dip without a retest etc…but I am also more willing to shift to a capital preservation mode, but only if there is a reason – not speculation.
What I don’t like to talk about is caution. I am always cautious. Caution is not the opposite of aggressive, in fact the more aggressive I get the more “Cautious” I get. I occasionally mention behavior and emotional control. I see caution as an emotional response – not useful for making judgements and it does not factor into my behavior.
So getting back to the first paragraph, I am setting my behavior at a moderate aggressiveness, coming out of this drop. Meaning, more then likely I will go into capital preservation mode if the market bumps up against the 585 resistance level a couple of times. I still plan to stick to my plan from a few days ago of working the S for the next month or so with a shift to the I – especially if the currency trends suggest this, at a later point following a correction. Right now, I am not sure if I bought the bottom and if we are on the way out.
Griffin
Well-known member
On Friday, the DWCP got above 575 and skipped along the surface. I interpreted that as a positive action, expecting the 575 level to act as a springboard towards 585. If the market had continued the bounce to 585, I would have tried to play the action (and possibly will when the time comes –in part, it depends on how long this lasts). Post holiday blues are weighing in on today’s pre-market, and I have gotten out of the business of trying to play the day to day onsies/twosies. It looks like the majority of the total loses will be dished out today, starting approximately .50% in the red and probably go down from there. The one exception to this is if the market comes back to 575 and can’t quite get on top of it. That is the only scenario in which I see a possible sell and buy the dip for a gain of two or more percent. More then likely, I will ride this retest out. I feel comfortable that I got the bottom on the first try, and will hold on (unless I see the DWCP drop below 553). The good news is that if the markets gyrate in these ranges for a few more days, the more likely it will be to make a full recovery later.
Griffin
Well-known member
Birchtree said:
Dennis,
I'm sure your familiar with the phrase "plan your fight, fight your plan" - I don't like to make moves unless I have a reason.
Today's action is typical at the bottom. Five weeks from now, people will be kicking themselves for not buying the bottom, not because they didn't play the whip.
I'm not saying that last Wednesday was the bottom for sure, but I have no reason to believe otherwise.............yet
Griffin
Well-known member
I figured I would repost this again since the last few days seem to have created some frustration and confusion.
It is a graph that compares the recovery of the three stock funds following last three major pull backs, and I have also added a graph to track the current recovery.
It is a graph that compares the recovery of the three stock funds following last three major pull backs, and I have also added a graph to track the current recovery.
Griffin
Well-known member
I am always amazed during these big moves, between how quickly I go from searching for a bottom to planning for a top. I want to see the DWCP top 580 before, I feel comfortable with taking the position that the recovery is on (the lower blue line). That could be tomorrow, what a ride this week has been! These recoveries seem so innocuous in hindsight, but they are so damn tricky when your in the middle of them.
Once above 580, the transition to 585 should be relatively quick (to the green line). The convergence of the green line and the upper blue line suckered a lot of folks in on the way down. I expect a rough ride from 585 to 590, probably several days off chop through this area and I would not be surprised if we see a reversal. Once again these lines will have to transition from resistance to support. Depending on how long this takes and what direction we come out of it in will effect the specific target numbers for the next move. It will be in this time frame that I start looking at my transition to the I-Fund. I don’t see the DWCP breaking through the orange line, given the projected economic slowdown.
I am in a moderately aggressive mode right now and I probably will not ride the chop for more then a day or two. I am debating about using the F-fund as my safe have while the 585-590 mess sorts out, but as I said back on the 23rd, the currency rat race is heating up, especially now that the EU is throwing their hat and kitchen sink into it.
Once above 580, the transition to 585 should be relatively quick (to the green line). The convergence of the green line and the upper blue line suckered a lot of folks in on the way down. I expect a rough ride from 585 to 590, probably several days off chop through this area and I would not be surprised if we see a reversal. Once again these lines will have to transition from resistance to support. Depending on how long this takes and what direction we come out of it in will effect the specific target numbers for the next move. It will be in this time frame that I start looking at my transition to the I-Fund. I don’t see the DWCP breaking through the orange line, given the projected economic slowdown.
I am in a moderately aggressive mode right now and I probably will not ride the chop for more then a day or two. I am debating about using the F-fund as my safe have while the 585-590 mess sorts out, but as I said back on the 23rd, the currency rat race is heating up, especially now that the EU is throwing their hat and kitchen sink into it.
Griffin
Well-known member
I am sitting in the G, but will move back into stocks regardless of what the market does today. So the only question is, where?
The I-Fund got a 1.22% negative fair valuation last night, Nikkei is down 1.81%, Europe is down across the board about 1.0% and the foreign currencies are weakening against the dollar. If the market goes straight into recovery, Europe will pick up some of the positive action before close. The net result would be something close to no movement in the I. This assumes the FV covers today’s negative action. This creates an excellent buy in point to play the lag. Some solid days of positive action in the foreign market and foreign currencies will likely strip away any gains made by the dollar over the following day or two.
Historically, the S-fund out performs the I-fund during the early weeks of these recoveries – and has been following that pattern since the original low on 24 May. My strategy calls to play the S-fund until the first correction after a solid recovery period, with a pause in the G and subsequently moving to the I.
If the market drops from here, the delay until today’s IFT happens will negate the lag time advantage for the I-fund and may actually set up an opportunity to play the lag at a later date (near the next top).
In a nut shell, if today’s action opens positive, I will go to the I for a couple of days, otherwise I will move straight into the S.
The I-Fund got a 1.22% negative fair valuation last night, Nikkei is down 1.81%, Europe is down across the board about 1.0% and the foreign currencies are weakening against the dollar. If the market goes straight into recovery, Europe will pick up some of the positive action before close. The net result would be something close to no movement in the I. This assumes the FV covers today’s negative action. This creates an excellent buy in point to play the lag. Some solid days of positive action in the foreign market and foreign currencies will likely strip away any gains made by the dollar over the following day or two.
Historically, the S-fund out performs the I-fund during the early weeks of these recoveries – and has been following that pattern since the original low on 24 May. My strategy calls to play the S-fund until the first correction after a solid recovery period, with a pause in the G and subsequently moving to the I.
If the market drops from here, the delay until today’s IFT happens will negate the lag time advantage for the I-fund and may actually set up an opportunity to play the lag at a later date (near the next top).
In a nut shell, if today’s action opens positive, I will go to the I for a couple of days, otherwise I will move straight into the S.
Griffin
Well-known member
Wheels said:
Dave,
I was doing the money flow on the Bull Pen thread and I would like to keep at it. Howevwer, I am limited in the time I have access to the internet so it's going to be sporadic at best over the next month at a minimum. The most time intensive part of it is gathering the data. Feel free to throw it out there. All I did was add up the allocations each day and crank it through an average.
vectorman
Active member
I found your S fund remark in the Bullpen interesting. But I see with the S fund being up 5 days in a row ( if today holds up) for you to be more risk than reward for tuesday. It's hard to stay put after you've been SSSnake bit before.:cheesy: The over all trend is now up, with many dips, I've learned in the past from Tom if your bullish long, sometimes it nice to keep a little in stocks, that way if it does goes up you still get part of the rally ( if there is one ) and if the market goes down your loss is small during the time the market recovers.
Last edited:
Griffin
Well-known member
If you follow Rokids tally, you will see I am one of the few single fund slingers. I don't dollar cost average, because I find it easier to keep track of my position if it's all or nothing. Yeah, when I screw up, it really hurts, but overall, I tend to be right more often then I'm wrong, so it all evens out in the end.
You mention risk versus reward, go to post #46 in this thread, this is how I look at it:
http://www.tsptalk.com/mb/showthread.php?t=2455&page=4
sugarandspice
Well-known member
Dudette, I'm just curious as to why you consider good management = greed. This isn't "Wall Street" - none of us are squeezing the life out of the poor and underpriviliged.
The reason I ask is I don't think of myself as a greedy person, in fact, I'm actually happier by the fact that I don't feel the need to drive a Porsche and live in a 4000 sq ft home (and neither does my wife, which is probably why I'm really happy about it
PS: Mrs Ravenclaw :nuts: - I don't want to hijack Dave's thread any further, but I do want to hear this....get back to me elsewhere.
Good management? Is making an IFT that is solely based on a tally of top performers good management? If it is then fine, but I don't believe it is. I never look at what top people are doing and just do that. The term "good management" is probably the (hor)crux of this.
And as for the Porsche or the house, how does that equate to greed? I dont make the connection at all.
To me greed would be the desire to acquire material wealth without sound strategy. Accumulation with a good plan is perfectly fine but I think when greed enters then things suffer. Like balances....TSP and soul. You must keep a soul balance or life around you will deteriorate i.e. family, work, TSP.
And if it deviates from what you know then you should determine the reason for the deviation.
You don't want to be hit by Maxwell's Silver Hammer.
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