Sunday, July 7, 2013

Here's a new long term 401K system using the BPT MA and other indcators

Here's a new long term 401K system, which uses a monthly chart along with the BPT MA Deluxe as well as other indicators and rules to catch long term trends in the market, while keeping you out of bear markets - it destroys buy and hold.  


CLICK HERE to watch a short 5 min video overview


Obviously system system is what I call a paint dry system because it is designed to stay in uptrend bull markets for as long as possible, but also stay out of bear markets, so it is not a system that most of you would be interested in, however family or friends who are not traders it would be ideal for.


For example my neighbor who seemingly ever week tells me about how his managed IRA account at AG Edwards has grown so much this year, I constantly tell him, that's great Pat, but you are only doing well because your broker simply has you invested in the market, when the market enters a bear market in the future he won't get you out, you will ride it all the way down - this system allows you to stay in the bull markets for years, but be out for bear markets so that you can buy back in at much lower prices, thus beating 99% of the masses.


As you can see the average trade length is about 1700 days! The average time the system is in cash or money market is about 400 days (these are the bear market periods).  I currently have the system as long only because with the clientele in mind like my neighbor or other friends who have 401K plans tied to the market, they are not allowed to short or would not short or don't even know what a short is, that's why I simply have the system exit the market and go to a cash money market fund where interest can be gained whenever an exit signal is generated.  


The statistics below show the returns, however if you would like I can also show the stats assuming that you shorted vs going to a money market fund- however I did include interest that would be gained while in a money market cash fund by looking at historical rates for the time periods where the system was out of the market.  Also regarding the BPT MA Deluxe indicator - as I show here, while it's a great indicator, as I've been telling all of you, it's MUCH better to use it as a tool with other indicators and analysis, vs trying to use it by itself. 


I also include the various indicators and rules to the system as well as chart examples.  I will eventually place this on the website in the long term tools and provide a Tradestation workspace

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