Quill: Two Questions for you

Quill,

#1 Does ‘market timing’ --as a strategy or tactic-- add value as opposed to ‘buy & hold’?
#2 Does ‘stock picking’ --as a strategy or tactic-- add value as compared with ‘indexing’?

My guess is that you’d say, “Yes”. But I’m inclined to argue that “it all depends” for there being times when both do well and times when both fail spectacularly. So what matters is being able to identify when it might be better to get in and out fairly quickly and when might be better to index than stock pick.

I’m running some backtests to try to discover which happens when. I’ll PM you my findings. But feel free to jump in with your thoughts now, or anyone else who might have stumbled onto this thread.

Charlie

DIA tracks the DJIA 30, a price-weighted index. EDOW is an equal-weight version of the same index. Very thinly traded. But maybe better for small accounts who don’t have access to fractional share trading, and --it seems-- the better preforming of the two. So, if one wants to play the game of Beat the Index by doing stock picking, EDOW would be the benchmark to choose.

NOTE: Leveraged ETFs, whether “bull” or “bear”, are NOT Buy-and-Hold vehicles, as their issuers warn and then proceed to explain the mathematics of why that is so.

Symbol Name Last %Chg %Chg
AXP American Express Company $254 3.57%
INTC Intel Corp $20 3.48%
AMZN Amazon.com Inc $185 2.77%
IBM International Business Machines $210 2.23%
MSFT Microsoft Corp $423 2.13%
HON Honeywell International Inc $204 1.54%
CRM Salesforce Inc $250 1.39%
AAPL Apple Inc $223 1.16%
GS Goldman Sachs Group $471 0.86%
JPM JP Morgan Chase & Company $207 0.81%
BA Boeing Company $161 0.79%
UDOW Ultrapro Dow30 3X ETF $87 0.73%
CSCO Cisco Systems Inc $49 0.66%
DDM Ultra Dow30 2X ETF $90 0.47%
NKE Nike Inc $78 0.40%
EDOW Equal Weight DOW 30 $35 0.38%
VZ Verizon Communications Inc $44 0.34%
AMGN Amgen Inc $330 0.32%
DIA Dow Industrials SPDR $409 0.25%
CAT Caterpillar Inc $335 0.25%
MMM 3M Company $130 0.11%
WMT Walmart Inc $79 0.04%
DIS Walt Disney Company $88 -0.09%
HD Home Depot $370 -0.10%
DOW Dow Inc $51 -0.18%
CVX Chevron Corp $138 -0.25%
DOG Short Dow30 -1X ETF $28 -0.25%
MCD McDonald’s Corp $290 -0.36%
V Visa Inc $284 -0.48%
MRK Merck & Company $115 -0.54%
KO Coca-Cola Company $71 -0.66%
SDOW Ultrapro Short Dow 30 -3X ETF $15 -0.74%
JNJ Johnson & Johnson $165 -1.53%
UNH Unitedhealth Group Inc $590 -1.55%
PG Procter & Gamble Company $174 -2.18%
TRV The Travelers Companies Inc $231 -3.16%
Average of the 30 stocks 0.39%

Quill,

My follow-up question would be this. Of the 30 stocks in the index and the 5 ETFs, what does your Simon Sez trading system say about which might be timely for tomorrow’s market?