sonki & chris,
a small correction on your tax calc :) your 30-40% tax portion is on your gain only, not your principal, so that means if you want to beat SPY, net of tax, you want to make 30% + 30%x30%=9%, that means if you can make 40+% by trading, you are ahead of SPY net of tax.
about NDX, yes, it has outperformed SPX for the period 1987-current - now you can invest in NDX just like you invest in SPY thru some high octaine NDX funds - Chris if you remember I asked you to try your system on NDX and see if you can get buy/sell signals as a stock ?
one can use same market timing model to get in/out NDX funds - just check these funds RYOCX, POTCX, UOPIX, ytd performance you see what I mean - and you dont have to trade in and out this much - this year there was really only two sell signals on 04/22 & 04/27, and then buy signals on 06/16 & 06/23. Had you missed the sell signal and remained in the market, well, you lose nothing except your tax liability. Unless you bought MSFT, DELL, LU, AOL in Jan, otherwise you might not beat these NDX index funds at all. |
