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Thread: 02/10/2013 Mousetrap

  1. #1
    Join Date
    Dec 1969
    Location
    Long Island, New York
    Posts
    515

    02/10/2013 Mousetrap

    Sector Model XLU 36.59%

    Large Portfolio Date Return Days
    BBRY 7/16/2012 127.45% 208
    SEAC 9/25/2012 38.43% 137
    CAJ 9/25/2012 1.22% 137
    CFI 10/31/2012 50.55% 101
    RE 11/26/2012 13.96% 75
    CGX 12/12/2012 4.26% 59
    OKE 12/28/2012 14.29% 43
    HTSI 1/14/2013 1.25% 26
    NSC 1/28/2013 -0.29% 12
    BOKF 2/4/2013 2.00% 5

    S&P Annualized 7.38%
    Sector Model Annualized 20.16%
    Large Portfolio Annualized 35.78%


    From: http://market-mousetrap.blogspot.com...g-to-time.html

    Rotation: selling HTSI; buying HMC

    The tea leaves here are still a curious mix. The Auto industry (for HMC) is a typical investment for a market bottom, not a market top.

    The grocery industry (for HTSI) is more of a toppish investment.

    Or in sector terms, exchanging a consumer staple (HTSI) for a business cyclical (HMC) is bullish.

    The sector model, on the other hand, is parked in XLU (utilities), which is a typical safe haven for a bear market.

    If the market seems confused, it’s not an illusion. It really does appear to be quite a mess.

    In the South we’d call this market “Squirrely” because it is like a squirrel that keeps running back and forth across the road in total confusion until a car comes along to run it down.

    HMC seems fitting, in that light.

    In GENERAL, the Mousetrap is positioned for another bull market advance, while the Sector model is positioned for a correction or even a bear. Here’s the breakdown of their typical outperformance during business cycles:

    Bottom CFI
    Bottom BOKF
    Bottom HMC
    Bottom RE
    Bull CAJ
    Bull SEAC
    Bull BBRY
    Bull CGX
    Bull NSC
    Top OKE
    Top HTSI
    Bear XLU


    Clearly the exchange of HTSI for HMC is hopeful.

    The breadth and money-flow strength of XLU could be an indication of the supposed “rotation out of bonds” we keep hearing about in the news. If I were a bond investor, I’d be interested in dividends and safety. Of the nine sectors followed by the sector model, XLU would be the place for bond investors to flee.

    Heck, I don’t know why people would be in bonds at all right now. XLU offers a good percentage better on dividend yield, and won’t implode when inflation begins to rear its head one of these days.

    So, for now… bullish on stocks and bearish on bonds. Only OKE has anything to do with inflationary plays, and it’s tangential to inflation, at best. So, no obvious appeal for commodities.

    Stocks, positive

    Bonds, negative

    Commodities, neutral

    All I can say is that I’m glad I don’t do market timing. This would make me pull out my hair.

    Tim

  2. #2
    Join Date
    Dec 1969
    Location
    Long Island, New York
    Posts
    515

    Second attempt

    HMC and HTSI gapped away from each other.


    Next attempt will be to purchase IBM.

  3. #3
    Join Date
    Dec 1969
    Location
    Long Island, New York
    Posts
    515

    Correction

    CORRECTION:

    There was a data error from Yahoo last night. After reloading the data, the computer industry is not -- repeat not -- in a buy zone.

    I will not be buying IBM this morning.

    Instead I will attempt to buy SWM at yesterday's closing price.

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