OT - Living under a rock

Investing Strategies Mechanical Investing
1

Not blatantly MI, so ignore if you want. I stopped followed MI for several reasons several years ago. My plan was to do passive indexing with simple BCC timing. Well, I’ve largely ignored almost everything market related for at least 2 years, just plopping away my inputs and growing my returns. I just looked and noticed there is a market correction going on and that BCC triggered 5/25 2 1/2 weeks ago.

My gut feel is that BCC from before is that BCC is slow acting and exact exit isn’t crucial. I see SPY rose some and dropped back down since 5/25. Are there backtests to support my understanding? Again ignore if you want. I never effectively learned how to drive GTR1.

I guess my simplistic question. Will I be hurting myself backing out now from a backtest standpoint? It’s impossible to predict the future, but I know CAPE has been foretelling poor future returns for years now.

Some of the money is in a 529 that has limited transactions, so whipsaw has always been something I wanted to avoid in those accounts.

2

Make a plan when the market is not in stress. Stick to the plan when the stress arrives.

BCC, like many timing methods, does not add much to CAGR. While out of the market, many small gains are balanced by a few large losses.

Subject: past BCC sell signals, Date: 4/29/2022
https://discussion.fool.com/past-bcc-sell-signals-35100895.aspx?..

Dates BCC turned 0, inflation > 5%, and sbqBars > 12.

  Date    [SMADiff]  [NHNLDiff]  CAPE   EG   inflation  PH98   prevBCC  sbqGain  sbqBars  Gain21d  Gain42d
19411216     0.0        -8.8     10.1  34%      10%     0.832     4       3%       15       4%       -1%
19420211     0.0        -0.6     9.7   21%      12%     0.833     2       -1%      78       -5%      -8%
19420624    -0.1        -0.4     8.9    5%      11%     0.915     2       3%        7       5%       7%
19461018    -0.1        -3.0     11.4  -27%     15%     0.781     4       4%       36       -2%      3%
19470110    -0.1        -0.6     11.5  -15%     18%     0.859     2       3%       13       6%       -1%
19471212     0.0        -0.7     10.7  14%       9%     0.929     4       1%        1       1%       -6%
19480121     0.0        -0.9     10.4  15%      10%     0.921     2       1%        8       -3%      2%
19480211     0.0        -5.6     10.0  19%       9%     0.879     1       1%       19       2%       11%
19480315     0.0        -1.5     10.2  22%       7%     0.896     1       5%        5       9%       15%
19691119    -0.3        -0.8     18.4  11%       6%     0.963     2       -3%      34       -4%      -6%
19700115    -0.4        -0.5     17.1   8%       6%     0.932     2       -1%      34       -5%      -4%
19700309    -0.8        -0.6     16.5   5%       6%     0.900     2       -7%      121      0%       -9%
19730605    -0.3        -9.1     15.8   9%       6%     0.877     4       2%       31       -3%      2%
19730802    -0.1        -0.5     15.3  11%       7%     0.928     2       -1%      24       -2%      3%
19730912    -0.5        -0.4     15.5  13%       7%     0.926     2       3%        5       8%       3%
19740329    -0.5        -0.5     13.3  14%      10%     0.878     2       -20%     198      -4%      -6%
19810827     0.0        -3.0     8.4   -2%      11%     0.912     1       -1%      30       -6%      -3%
19811208    -0.1        -0.7     7.8   -3%       9%     0.933     2       -6%      80       -4%      -7%
19820521    -0.7        -0.4     7.2   -11%      7%     0.936     2       2%       65       -5%      -2%
19901204    -0.7        -1.3     15.8   3%       6%     0.888     4       2%       31       -1%      7%
20220525    -22.5       -7.8     32.5  62%       8%     0.830     4
avg                                                                       -1%      42       0%       0%

[NHNLDiff] is a 9-day weighted average of NHNL. No signs of [NHNLDiff] going positive anytime soon.

  Date    [PcntNHC252]  [PcntNLC252]  NHNL
20220525      0.6           5.7       -5.2
20220526      0.8           3.4       -2.6
20220527      1.8           1.4        0.5
20220531      0.9           2.5       -1.6
20220601      1.0           4.6       -3.6
20220602      1.6           2.2       -0.6
20220603      0.9           2.7       -1.8
20220606      1.0           4.3       -3.3
20220607      1.2           2.3       -1.1
20220608      0.6           2.0       -1.4
20220609      0.3           4.7       -4.4
20220610      0.2           11.1      -10.9
7 Likes