Friday, January 4, 2013

December Returns

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Over, But Not Gone
When it comes to New Year's resolutions, this year's replace last year's.  Too bad we can't say the same for the equity markets.  Although we are turning the page on the calendar, the world economy brings along much unresolved baggage.  The pop in the markets this past week has many cooing about what a good omen it is for the coming year.  Never mind the fact we still haven't solved the problems of 2012 - Europe in general, out-of-control spending in the U.S., large inventories in China, and one that hasn't got much media attention -  Japan's bond bubble.  If we can Ignore all of that, though, 2013 has the potential of being a swell time for investors!?!

Looking Back
More importantly, the end of the year is a good time to reflect on what went right and what went wrong.  I will say I was not active enough and/or spent too much time out of the market, but not making money is better than losing it.  I spent long hours looking for a better methodology in dealing with such a volatile market, and am happy to say I feel I have accomplished just that.  More on that in future posts.

Changed My Thinking
I also changed my thinking on something I had mentioned in an earlier blog.  Previously, I did much careful analysis in timing my entry points with the use of charts.  When I saw an opportunity I was quick to take a full position.  That approach cost me, a couple of times, last year.  I am now of the opinion the right approach is to take half of my position, then wait for a pull-back to fill the rest.  I still like my original approach, but my tendency is to bail too early when larger amounts are involved.  My newer approach causes me less stress! 

Please, and Thank You
If you are a regular reader of my blog, and even if you aren't, please feel free to ask me questions, challenge me, call me out, whatever helps you and, hopefully, others to deal with these markets.  I don't have all the answers, I make my share of mistakes, but love to share insights that come from 20 years with money in the stock market.  I am not a financial advisor, but I do want to challenge the conventional financial advice in order to help anyone interested to increase the returns of their equity portfolio.  

May you enjoy a prosperous New Year.  Hope to hear from you in 2013.       

24 month return for TSX @ December 31, 2012 =     -6.89 percent
Return for Basic Timing Model Using XIU =             13.75 percent
Return for Advanced Timing Model =                       -4.36 percent
Money for charity =                                               $0.00

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