Wow! I thought I was asking a quick and easy question. Thanks for the thoughtful and complete response. I hope you won't mind if I take issue with you on a few points.
First, I've only followed this thread for a few months, so I don't share the animosity many of you have against Dipy. From my point of view, he just has opinions that help define the boundry of the bell curve. Personally, I think that is a good thing, and provides a source for discussion. If the animosity goes back to before I started following the thread, then I'll just sit back and watch the sparks fly. Y'all can duke it out without my involvement.
Now, on to the fun stuff. It seems rather obvious that the more diversified a portfolio, the more likely it is to mimic the Wilshire 5K. The challenge, I would think, would be to have a portfolio that would share in most of the gains of the overall market with less downside risk and/or volitility. That, in fact, is why there are so many traders (as opposed to LT investors) in the market. Whether or not they are successful is a whole different subject. So, I would debate your contention that my (or anyone else's) portfolio "should" track the market. Similarly, since I have no intention of trying to match the W5K, but only to use it as an indicator of bull/bear trends, it was nice to have someone like Brinker to listen to, because he seemed to always be right. When trading high betas, the addage "the trend is your friend," takes on a whole new level of importance. I care a lot less about Brinker's stock and MF picks than his prediction of the market in general. My mistake was in heeding his advice rather than my own last July. IMO, "be comfortable with your market allocations" is not the same as "SELL!" I try to be comfortable with my allocations at tops, bottoms, and in between.
You mention, as if it were fact, that "bear markets last six months or more." While that may mean something in a particular context, I doubt that there is universal agreement. A 20%+ drop is usually the criterion to define a bear, irrespective of duration.
Brinker's interest in tech analysis terminology seems to be inversely proportional to his confidence in his predictions. That is, the more shakey his confidence, the more he relies on whatever might bolster his stated prediction. We are near, I think, the time when he will be telling us that the "moon is in the 7th House and Jupiter aligns with Mars," to convince us that we really are in for a big gain in the not too distant future.
Finally, I don't blame Brinker for my losses this year. I blame myself for being foolish enough to take his advice instead of my own. To be honest, though, I was pretty angry with him in August when he decided to play golf when the market was falling apart. I thought it cowardly and irresponsible of him to leave those of us who listened to his advice to twist in the wind. And, my opinion of him is not improved at all by his refusal to admit that current market conditions have us at the cusp of some serious global economic problems.
Whew. Too much to put into a single post. I was interrupted several times while writing this, so I apologize for any lack of continuity.
Good trading, Kirk,
jim |
