uf,
Microsoft's MC Investor "Portfolio Manager" has them at +5.7%. They calculate off of Friday 12/31/99 close I believe.
The "Santa Claus" effect kicked in this year (it does not always) on top of "After Hours" trading and to top things off you had a whole 3 day weekend between close of 1999 and beginning of 2000.
Chaos! Absolute Chaos! Triple Whammy.
There was a huge difference between Friday 12/31/99 close and Tuesday 1/04/00 open, and anyone that placed a market buy on high flyers like QCOM or BVSN or EMLX over the intervening weekend, got CREAMED.
I am acutely aware of this, because I had decided to play a monthly rotation of 3 momentum stocks using Jon Markman's excellent mechanical (SuperModel) screens with 5% of my portfolio. Fortunately I set aside $ in mid December for this endeavor and bought into QCOM and BVSN early. The 3rd momentum stock (EMLX) went down to the 12/31 wire. I put a TDO Limit Buy order in over the weekend (I never fo market orders) for EMLX. It never hit. By Wednesday I realized what had transpired, cashed in my QCOM and BVSN at large profit, and made a decision NOT to play the rotation game.
Jon has a recent article on this here:
He says this:
>> Supermodels. It didn't take long to make my biggest mistake of 2000. It came in the very first minute of trading when I started my hypothetical online YearTrader 2000 portfolio with opening prices on Jan. 3 and failed to warn readers not to do the same. Many readers apparently got burned buying Emulex (EMLX) and Qualcomm (QCOM) at extreme highs for the day. Emulex went on to higher highs before getting creamed and then recovering, but it was the historic high for Qualcomm. Resolution: From now on, I'll use the close on the last day of the first week of trading for my official YearTrader portfolio, which is the date used in my back-testing software. For real-money YearTrader portfolios, the best start date is probably into the close of a decline of 3% or greater in the Nasdaq ($COMPX) in the middle weeks of October or early November. I'm targeting potential selling climaxes on Oct. 13, Oct. 16 or Oct. 23, but stay flexible. If reaction to good earnings news is overwhelmingly negative over the next two weeks, it might be prudent not to initiate new positions. <<
Very good complete article by Jon, called "Supermodels: Bear With Me: Confessions And Cautions Here":
moneycentral.msn.com
I would like to suggest that we use end of day close of year prices for our indexes.
- Eric - |
