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Spaf, thanks forsharing another great concept. Your analysis seems to be on the money. Let meadd another scenario to it. Suppose 2005is a year in whichthe SFund (or C or I) givesan investor aroller coasterthrillride but ends upflat or breaking evenfor the year. If he useda buyandholdstrategy,the G Fund willoutperformby 5% andhis opportunity cost for the thrilling ride was 5% plus theyear lost inhis questforfinancial freedom.Skillfulmarket timing or luckappearsto bethe only way to beat the current 5% return unless a new bull market similar to the 1990s begins soon wherewecan buy and hold C, S or I.
After this week'sstock market selloff, your planseems very prudent:Wait for an upwardbreakout oftwo days or more in the market averages. Withheavier trading volume, the breakout shouldindicate that professional/institutional sellershave stoppedtheir selling temporarily and arebuyingagain.
Atthe Dow Jones & Company website
[url]http://djindexes.com/mdsidx/index.cfm?event=showAverages[/url],an interesting historicalchart of the Dow Jones Industrial Average (DJIA) is available free of charge under the "Dow data" column. The chartsshow that in the years1966 to 1982the DJIA ended close to where it began16 years earlier.There wereseveral bull markets and several bear marketswithin that timeframe.Also,sideways drifting markets were in vogue from 1897 to 1914 andfrom 1916 to 1942, punctuated withseveralbull and bear markets.
Perhaps 2000 to 2016 is anotherstock market period similar to the great, long term,sideways markets of the last 108 years.However, if TSPTalk Investors work as a team bysharing their best trading strategiesand investment thoughts, we can each select the beststrategies for our own situation, applythem, andreachfinancial freedomsooner. Thenit may not be importantwhat type of markets we experience.
Best ofluck toall TSPTalkmembers and thanks for the great ideas!
Spaf
