Entering text into the input field will update the search result below

My Current View Of The S&P 500 Index: May 2020 Edition

May 03, 2020 3:36 PM ETAGG, EFA, IWM, SPY6 Comments
Walter Zelezniak Jr profile picture
Walter Zelezniak Jr


  • My allocations remain the same.
  • Equity markets rallied substantially in April.
  • All equity ETFs remain in bearish alignment.
  • AGG is in bullish alignment.

This month’s article will outline why I will maintain my allocation of 25% to the SPDR S&P 500 Trust ETF (SPY) and 75% to the iShares Core U.S. Aggregate Bond ETF (AGG) with my retirement assets in May. First, let me review my performance in April. Money was made in April. The market, as measured by the S&P 500 index, rallied substantially gaining 12.68%. As for my pension plan assets, I had a modest gain of 4.47% in April, underperforming the SPY ETF. My investment objective of preserving my capital was met, yet I did not beat the overall market as measured by the S&P 500 index. Table 1 below shows my returns and allocations for the month of April and Table 2 below shows my returns for the past 12 months.

Table 1 – Investment Returns for April

Table 2 – Investment Returns Last 12 Months

To review the purpose of this series of articles, my retirement account only allows me to buy the following four ETFs: the iShares Core U.S. Aggregate Bond ETF, the SPDR S&P 500 ETF, the iShares Russell 2000 ETF (IWM), and the iShares MSCI EAFE ETF (EFA). I can also have my money in cash. The question is how to decide where and when to allocate money to these various ETFs.

I use my moving average crossover system combined with relative strength charts to determine how to allocate my pension plan assets. My moving average crossover system uses the 6-month and the 10-month exponential moving averages to identify which of the four ETFs are in a position to be bought. If the 6-month moving average is above the 10-month moving average, then the ETF is a buy. I call this setup being in bullish alignment. When the 6-month moving average is below the 10-month moving average, the setup is referred

This article was written by

Walter Zelezniak Jr profile picture
As an individual investor nearing retirement I am trying to build my financial assets in order to have a fulfilling retirement. I am interested in trading both long and short; or at least using inverse ETFs, to take advantage of market declines. Having long term and short term trading strategies, proper execution of my trading plan, and absolute investing results are my goals. I see my articles as a way to keep me focused on developing winning trades. I also expect to learn much from the feedback that is provided in the comments section.

Analyst’s Disclosure: I am/we are long SPY, AGG. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (6)

Thank you Walter
Excellent analysis. I'm trying to understand how to develop and use these charts and will continue to follow your work!
Walter Zelezniak Jr profile picture

Thanks for reading and for the kind words. Good luck moving forward.

Walter Zelezniak Jr profile picture

Charting books I like:

Trendfollowing by Mike Covel

Trading for a Living by Alexander Elder

Any technical analysis book by John Murphy

User 10318561 profile picture
If SPY was in bearish alignment why did you invest in it in April and why are you allocating to SPY in May? Also how was the 75-25% allocation determined for April?

Thanks for the great work.


Walter Zelezniak Jr profile picture
User 10318561,

The best way to understand why would be to read the previous two articles. In summary, when price broke below the 10 month EMA I went 50% SPY and 50% AGG. I simply decided to reduce my exposure to SPY by half from previously being 100% allocated to SPY. When SPY went bearish alignment the next month I went to 25% SPY and 75% AGG. I simply decided to reduce my exposure to SPY by half again. In the previous article I mentioned that the market will eventually recover and by having some exposure to SPY I will automatically be in the market when it starts to rally. I hope that helps. Thanks for your interest and for reading my article.

Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!

Related Stocks

SymbolLast Price% Chg
iShares Core U.S. Aggregate Bond ETF
iShares Russell 2000 ETF
SPDR® S&P 500 ETF Trust

Related Analysis

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.