This is for TSPTalk concerning the Sentiment Survey...

[Chulke]

Hi TSPTalk,

I just read your post in the premium service area (at least I think it was the premium area...not sure how I was able to read it...I just clicked on it and it opened)...but basically it was you saying you were toying with ideas of tweaking the Sentiment survey system. A quote from your post below:

"That isn't always the case so I hope we do get that sell signal when the time comes. The problem is, our readers have become so quick to jump into bearish mode, nearly after every down day so my fear is the system may not get a sell signal. We did have 3 sell signals in the last 10 months so perhaps I am worried about nothing. So far the bearishness has helped the system stay in stocks and have a very good year.

Some of the things I have considered to tweak in the system, is the use of a stop loss. I haven't worked the numbers yet, but this could hurt more often than help, but when it does work it would be very beneficial. The objective would be to avoid any kind of major decline after a series of down weeks, since the system would likely have us on a buy after a couple of down weeks."


So anyway...I was thinking and looking through the system's historical yearly returns and was wondering if you noticed the every 3rd year pattern...which I'm sure you have...where every 3rd year has been a negative year for the system (i.e. 2008 -6.14% & 2011 -10.27%) and with that, one can only assume that the system will have a negative year next year for 2014. So I ask you have you seen any historical evidence to prove why this is? And have you back tested the system to the dates of inception with each of the funds and had other negative years you don't show? Just wondering?


Secondly, I was wondering why the system doesn't take advantage of the F fund...I mean even in those 2 negative years for the system (i.e. 2008 and 2011) the F fund posted a 5.45% and a 7.89% return respectively. And since inception the F fund has only had 2 negative years while the G fund (although always positive) has been on a steady decline percentage wise since inception. https://www.tsp.gov/investmentfunds/annual/annualReturns.shtml


I know the Sentiment Survey probably has some complicated computer algorithm of market performance, coupled with the survey results to point the right direction but I can't see why you couldn't add a bull/bear market rule of "if" the dollar index is at "x" level then the system goes F fund or something along those lines (just as an example of course)...Of course I'm no market genius or anything I just happened to notice that every 3rd year was a down year for the system from what is shown here on the website. And believe me I'm not trying to get you to modify the system in anyway...I can't argue the results as a whole...they're quite stellar in fact! I'm just wondering if you have tried this or if you have thought about it.

BTW...Congrats on going premium!


Cheers!

 

[rcknfrewld]

i would say the odds of 2014 being a down year would be 50/50

 

[Chulke]

LoL...I would say the same thing from a personal standpoint but, I'm trying to look at it from the system standpoint.


I mean what if you could erase those 2 down years or turn them into a positive year simply by changing the fund you're invested in based on 1 more criteria...Wouldn't you want to do it?


I know I would!!!

 

[rcknfrewld]

the SS has a great track record...I would sign up for next year even if you think it will be negative, you could use it as a contrarian to the contrarian play...or sit next year out and hop on in 2015...waiting is no fun though...the returns have been stellar, take the good with the bad...many men have failed trying to get happier than happy

 

[Chulke]

I'm not knocking the track record at all...in fact I'm praising it...but I have to ask the question...Is it possible, the system could have generated a return on those down years just by adding another rule to the mix?

I only ask cause Tom previously mentioned he had thought about tweaking the system...and I also agree with Tom from that same post..."If it ain't broke...Don't fix it!"

This is really just a friendly conversation of "what if" more than anything else...


Geez....so many people on here are so touchy and defensive about thier leaders and their systems...

But Cheers to you just the same!

 

[tsptalk]

So anyway...I was thinking and looking through the system's historical yearly returns and was wondering if you noticed the every 3rd year pattern...which I'm sure you have...where every 3rd year has been a negative year for the system (i.e. 2008 -6.14% & 2011 -10.27%) and with that, one can only assume that the system will have a negative year next year for 2014. So I ask you have you seen any historical evidence to prove why this is? And have you back tested the system to the dates of inception with each of the funds and had other negative years you don't show? Just wondering?

Hey Chulke -

Thanks for the feedback. The -6.14% year was due to the stock funds being down 37% to 42% in '08. Ugly year, so I consider -6% a huge victory for the system.

The -10.27% loss also came during a year when s-fund was negative, but still the system unperformed. It's going to happen, and as I mentioned in that post, I hate to make too many changes because of the long term success.

The F-fund is a good possibility, but like the current situation, the F-fund does not always go up when stocks are down. In the long-run - probably a good addition, however.

Thanks again for your input. (can you still see the content of that thread?)

 

[Chulke]

Hey Chulke -

Thanks again for your input. (can you still see the content of that thread?)

Why? Did you delete me?

 

[tsptalk]

LOL - I hope I deleted everybody (who was supposed to be deleted).

 

[sstasel]

(can you still see the content of that thread?)

I can't -- though I didn't try accessing it earlier today before you added the $ at the beginning of the thread name. Just an FYI, I should not have access as I haven't paid for it.

 

[Chulke]

I can still view it...I just can't post anything in that thread...I even logged out and logged back in...I'm not complaining though...just stating a fact! LoL!

 

[Intrepid_Timer]

Hey Chulke -

Thanks for the feedback. The -6.14% year was due to the stock funds being down 37% to 42% in '08. Ugly year, so I consider -6% a huge victory for the system.

The -10.27% loss also came during a year when s-fund was negative, but still the system unperformed. It's going to happen, and as I mentioned in that post, I hate to make too many changes because of the long term success.

The F-fund is a good possibility, but like the current situation, the F-fund does not always go up when stocks are down. In the long-run - probably a good addition, however.

Thanks again for your input. (can you still see the content of that thread?)

Should you point out that the -6% loss was after the fact? If you were actually following it at the time, you lost over 38%. The rest of us can't go back and change our returns after an "update"........

 

[tsptalk]

The current system was down 6%. Yes. The old system changed after 2008 was down 38%. I don't hide that. It's posted on every page that shows that return. It was the only year affected. Assumed they knew.

 

[Intrepid_Timer]

The current system was down 6%. Yes. The old system changed after 2008 was down 38%. I don't hide that. It's posted on every page that shows that return. It was the only year affected. Assumed they knew.

You should know better than that. Let's hope it doesn't lose 6% again, or 10%. You know how much grief I get and I haven't lost anything............yet............ At least you would have 500 surveyees to blame!! :laugh:

 

[dhstdog]

You can always say you modified it and then backtested it and if you would have had it in place you would have made x percent. I have read that in the premium pages a few times! Just sayin...

 

[Chulke]

That's what I'm saying too....what can it hurt to backtest it?

 

[Cactus]

You should know better than that. Let's hope it doesn't lose 6% again, or 10%. You know how much grief I get and I haven't lost anything............yet............ At least you would have 500 surveyees to blame!! :laugh:

I think you set yourself up for the grief you get, IT. Your returns are great, but you build up people's expectation to get even more, so they become disapointed. You kept talking 24% during the 1st year of your premium service. If you hadn't done that, your wouldn't have disappointed so many folks. Your returns speak for themselves, don't shoot yourself in the foot.

 

[Intrepid_Timer]

I think you set yourself up for the grief you get, IT. Your returns are great, but you build up people's expectation to get even more, so they become disapointed. You kept talking 24% during the 1st year of your premium service. If you hadn't done that, your wouldn't have disappointed so many folks. Your returns speak for themselves, don't shoot yourself in the foot.

True, but that is still "one" of my goals.

 

[k0nkuzh0n]

I think you set yourself up for the grief you get, IT. Your returns are great, but you build up people's expectation to get even more, so they become disapointed. You kept talking 24% during the 1st year of your premium service. If you hadn't done that, your wouldn't have disappointed so many folks. Your returns speak for themselves, don't shoot yourself in the foot.

faulting IT for being upfront, open, and honest? Got to love the logic there.

 

[tsptalk]

OK, we're getting off topic so I assume we're done with this discussion. I'll close the thread. Thanks for everyone's input.