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Those moves seem right; they comply with the 31 day rule (no reversals within 31 days, but they are allowed to make additional changes in the same direction).
January 7: 30% stocks (increase), because S&P dropped below 2000 (1990 on Jan 6th) January 11: 35% stocks (increase), because S&P dropped below 1925 (1922 on Jan 8th)
January 12: no change. S&P went back over 1925 (but 31 day rule prevented immediate reversal; couldn't decrease stocks).
January 13-29: no change. S&P remained within 1850-1925 band (35% stocks).
January 29 - February 1: no change. S&P went back over 1925, but 31 day rule was still in effect, so no decrease in stocks was allowed.
Feb 12: 40% stocks (increase), because S&P dropped below 1850 (1829 on Feb 11).
Feb 13 - March 13: no change. 31 day rule prevented decrease in stocks, even though S&P rose.
March 14: 25% stock (decrease), because S&P was over 2000 (2022 on March 13), and fund could reverse direction - it had waited 31 days since it increased stocks.
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My concern is with the Brexit trading. Taking your suggestion, I did send email to Columbia. But I erred in that email. Here's what did happen, and why the fund did not capture Brexit:
March 14: 25% stock (decrease) April 14: 20% stock (decrease), because S&P rose above 2075 (2082 on April 13).
April 15 - May 14: no change. 31 day rule prevented increase in stocks, even though S&P dropped below 2075 in late April/early May.
May 16: 25% stock (increase), because S&P closed at 2066 on May 13th. This was below the new 2100 threshold effective May 1st. (2025-2100 range for 25% stock allocation.)
May 17-June 15: no change. 31 day rule prevents decrease in stocks. To increase stocks, S&P would have to close below 2025, which didn't happen.
June 16: - June 22: no change. S&P remained between 2025 and 2100 (25% stock allocation)
June 24: 20% stock (decrease), because S&P rose above 2100 on June 23.
June 25-June 30: no change, because 31 day rule prevented fund from increasing stock allocation, even as the S&P dipped below 2000.
Because of the 31 day rule, the fund was not allowed to buy stocks low (June 24-June 30) and sell high (July).
It was required to stand pat. It may make sense for funds to ride out rapid market movements. So I don't generally fault funds for missing this type of trading opportunity. But I'd like that miss to be for tactical, not tax reasons.
Interesting fund. Though Columbia Thermostat Fund reminds me of PAUIX --- a fund of funds that (to me) looks like a place for the fund provider (in this case, Columbia) to sell more shares of its other funds in a new wrapper. I don't think they need that many funds to make the strategy work, so I'd pass on the vehicle for that reason alone.
Comments
Those moves seem right; they comply with the 31 day rule (no reversals within 31 days, but they are allowed to make additional changes in the same direction).
January 7: 30% stocks (increase), because S&P dropped below 2000 (1990 on Jan 6th)
January 11: 35% stocks (increase), because S&P dropped below 1925 (1922 on Jan 8th)
January 12: no change. S&P went back over 1925 (but 31 day rule prevented immediate reversal; couldn't decrease stocks).
January 13-29: no change. S&P remained within 1850-1925 band (35% stocks).
January 29 - February 1: no change. S&P went back over 1925, but 31 day rule was still in effect, so no decrease in stocks was allowed.
Feb 12: 40% stocks (increase), because S&P dropped below 1850 (1829 on Feb 11).
Feb 13 - March 13: no change. 31 day rule prevented decrease in stocks, even though S&P rose.
March 14: 25% stock (decrease), because S&P was over 2000 (2022 on March 13), and fund could reverse direction - it had waited 31 days since it increased stocks.
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My concern is with the Brexit trading. Taking your suggestion, I did send email to Columbia. But I erred in that email. Here's what did happen, and why the fund did not capture Brexit:
March 14: 25% stock (decrease)
April 14: 20% stock (decrease), because S&P rose above 2075 (2082 on April 13).
April 15 - May 14: no change. 31 day rule prevented increase in stocks, even though S&P dropped below 2075 in late April/early May.
May 16: 25% stock (increase), because S&P closed at 2066 on May 13th. This was below the new 2100 threshold effective May 1st. (2025-2100 range for 25% stock allocation.)
May 17-June 15: no change. 31 day rule prevents decrease in stocks. To increase stocks, S&P would have to close below 2025, which didn't happen.
June 16: - June 22: no change. S&P remained between 2025 and 2100 (25% stock allocation)
June 24: 20% stock (decrease), because S&P rose above 2100 on June 23.
June 25-June 30: no change, because 31 day rule prevented fund from increasing stock allocation, even as the S&P dipped below 2000.
Because of the 31 day rule, the fund was not allowed to buy stocks low (June 24-June 30) and sell high (July).
It was required to stand pat. It may make sense for funds to ride out rapid market movements. So I don't generally fault funds for missing this type of trading opportunity. But I'd like that miss to be for tactical, not tax reasons.
Interesting fund. Though Columbia Thermostat Fund reminds me of PAUIX --- a fund of funds that (to me) looks like a place for the fund provider (in this case, Columbia) to sell more shares of its other funds in a new wrapper. I don't think they need that many funds to make the strategy work, so I'd pass on the vehicle for that reason alone.