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Strategies & Market Trends : Peabody Coal vanguard retirement forum

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From: MACD X9/23/2007 11:26:12 AM
   of 75
 
09 23 07 update

This week there is no change in the investment stratagy and that is to be 100% invested in the Vangaurd Prime cap fund VPMCX which tracks the large cap sector.

Below is a 8 year chart of that fund and its performance.

stockcharts.com

I hope some here are getting interested in the stock market and have studied some about charts, and if not our signals are coming from the 13 and 34 week moving averages.

These are the blue and red lines on the chart above. The other things on the chart are called candlesticks. There is one for each week in the past. The red ones were down weeks while the white ones are up weeks.

The chart shows the importance of our system, Notice in the red Box square that spanned from the year 2000 to 2003 that the red line was over the blue line.

Following this system we would not have been invested during this time and would have been in Bonds or interest funds and would have missed most of this downfall.

This is why over a long period of time we should be able to out perform others that are not using this system.

If and when we get a red over blue crossing and the call to exit the market comes there will be risks. If the market trades sideways false signals will come and this is the risky part, it is possible to loss money with this system if the market trades sideways for an extended period of time.

History has shown that this usually hasnt been the case and it usually trends as can be seen on the chart above.

When the time comes to consider exiting I will go over the risks.

The chart below shows a fund that is in our choices of funds and is an example of this sideways movement.

stockcharts.com

It would have been possible to loose money with our system if this were to occur.

There is always a sector that is doing good and we will try to be in this sector when this occurrs.

But still over the long haul we should be able to outperform the group 10 times over in a twenty year period of time maybe more by just stepping out of the way of the big moves down like that occurred in 2000 to 2003

By the way our fund did almost 3% last week alone
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