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Should You Cash Out Of Mutual Funds In A Bad Stock Market? -- Investors Business Daily
The problem is that when this type of isolated analysis is presented, there's no rules based, empirically tested tactical allocation process presented to be objectively compared against. A simple 10 month moving average cross with a bond allocation heuristic ) has identified cash signaling periods ( cash during sometimes substantial portions of price decline ) pretty well. Many of those 10, 20, 30, 40 "best days" are encompassed within the "decline" legs. The key with a mechanical system is to have more "best" days in legs when equity allocation is signaled than when cash allocation is signaled ( which has seemed to be that case with the 10 mo SMA process) . https://docs.google.com/document/d/1XwZjcWy7KlSwA7xi0rax7nevIBCtW0Uu4UZFH-Hc1ns/edit?usp=sharing https://docs.google.com/presentation/d/1mdon_cto48rvs2_lKWyMWrfqSIh8K0phfe7tThle8qQ/edit?usp=sharing Also, as the financial industry is driven by product sales and money management incentive, there is little room or funding for tactical / strategic allocation research.
Comments
Regards,
Ted
http://www.mutualfundobserver.com/discuss/discussion/25640/should-you-cash-out-of-mutual-funds-in-a-bad-stock-market#latest
A simple 10 month moving average cross with a bond allocation heuristic ) has identified cash signaling periods ( cash during sometimes substantial portions of price decline ) pretty well. Many of those 10, 20, 30, 40 "best days" are encompassed within the "decline" legs. The key with a mechanical system is to have more "best" days in legs when equity allocation is signaled than when cash allocation is signaled ( which has seemed to be that case with the 10 mo SMA process) . https://docs.google.com/document/d/1XwZjcWy7KlSwA7xi0rax7nevIBCtW0Uu4UZFH-Hc1ns/edit?usp=sharing
https://docs.google.com/presentation/d/1mdon_cto48rvs2_lKWyMWrfqSIh8K0phfe7tThle8qQ/edit?usp=sharing
Also, as the financial industry is driven by product sales and money management incentive, there is little room or funding for tactical / strategic allocation research.