Jeff Miller

ETF Update: Absolutely Nothing to Love

Paultaut -- DYY and DAG do not fit the criteria for our trading universe. The system was developed using equity sectors in a number of different time frames and market conditions.

DYY and DAG, are leveraged and commodity-based. We are careful about applying the system in completely uncharted territory. Perhaps when we can do some research on ETN's and commodities, making modifications if necessary. We also believe that there is plenty of volatility and trading opportunity without adding leverage.

Thanks for asking this question and helping me to clarify how we make choices. I wish I could provide more information. Meanwhile, I am open to suggestions to extend our list or replace existing choices. We also provide a custom rating service for some investors who have their own lists.

Thanks again,
Jeff

ETF Update: Time to Look at China

JGL -- The trading characteristics of commodities are different from those of stocks. We try to stay close to our methods, so we specialize in equity ETF's. Perhaps at some point VInce will explore commodity trading.

It is a good question, and I appreciate your interest.

Jeff


On Feb 17 09:21 AM JGL wrote:

> - Why MOO rather than DBA (companies rather than commodities)?

>
>
> - Interesting no precious metal (e.g. gold) in the ETF list?

ETF Update: Time to Look at China

Thanks for the helpful comments on China!

As to our method, we have talked about this a bit in prior articles. The date of entry is when the model first signaled a buy. Also, the ETF had to be in the top eight. We note when we exit positions. The "penalty box" is something like a "stop loss". It means that the position violates certain technical considerations. We do not buy anything in the penalty box, and we sell holdings when they get that designation.

Thanks,

Jeff

ETF Update: A New Look at Gold

Ray - You may not know it, but we cannot legally advertise performance for a fund limited to accredited investors. That is where we stood as of 2005, when we were encouraging people to get in touch with us for more information.

In the TCA-ETF series I responded to some individual requests to make this into a program where the average investor could participate. We did a lot of work to cut down on the number of trades and make it work within the TD Ameritrade framework. We took the same model signals we used for the daily program, and the ones I have been reporting in real time, and developed a report, which is available upon request. At that point I always talk with any interested investor about suitability, risk tolerance, etc.

I'm not quite sure why you call it "bragging." If you read the report, you will understand better. We do take some pride in putting together a good team and using the most advanced methods.

Thanks for raising some good questions, and for reminding me about the need to update the static site.

Jeff

Are You Missing the ETF Rally?

Uncle Bill -
Thanks for your question. I can see that you did some research with genuine interest, so let me try to clarify a few things.

While I have been trading market sectors through model-based rotation systems for nearly ten years, the application to the ETF's, and particularly to iShares, is a new approach for us. I have tried to explain why this universe is especially good for our model, and I'll write more on this in the future. Meanwhile, the record you see here is what we actually did. The articles include a rapid trade in and out of a sector in August, and how we were out of the market for a month.

I am trying to illustrate what it is really like to trade a system. Most people do not understand at all. I do not expect to call bottoms and tops with this method. In fact, I know that I will get whipped around at transitional points. How? From studying the careful, out-of-sample back tests, so I am prepared for what I get. I also know there will be some negative patches and drawdowns.

We use this model for our intermediate outlook even when I personally disagree. (Over the years, the model and I have been pretty close overall, both with excellent records.) Because we make our position public on the Ticker Sense blogger sentiment poll, you can check us out for a longer period. When the model is negative, we include short ETF's to hedge the position. We might still be net long, but the percentage has been reduced.

I am still trying to figure out what to include in these articles, and what the timing should be. Your comment is helpful in that regard.

Thanks,

Jeff