03-20-2022, 05:16 AM
The simplest investing strategy I use
<!-- SC_OFF --><div class="md"><p>We've all heard the phrase that time in the markets, beats timing the markets. But what if I told you that's it's possible to actually do both. Be in the markets 100% of the time while also being able to attempt to time big sell offs and rallies.</p> <p>This strategy relies on keeping money in the simplest low cost index funds, vanguard is a very great option but not the only one. I'll explain the concept first then how I apply it to my portfolio.</p> <p>The concept, is to use simple ratios to decide what major index is performing best. On trading view you can make a ratio by charting either an etf or the index, whatever you chose to use just he consistent. So you do up charts that look like Sp500/Nasdaq100 or sp500/dow30. I then add a 365 day sma to the chart.</p> <p>This line simply tells us, given the past 1 year of price action what index is outperforming the other? If our candles are above the sma, it shows strength in the index kn the numerator. If it's below the sma it's showing strength in the index in the denominator. The sma acts as a switch so to speak. </p> <p>We can go further with this. When you've analyzed these ratios you'll see the sp500 is dominant right now. So let's go further. Sp500/sp500 value. And sp500/sp500 growth. And sp500value/sp500 growth.</p> <p>If you chart these ratios you'll see sp500 value is currently performing the very best, relative to all the other indices.</p> <p>So what do we do with this information? I personally use it for my 401k. 10% bonds, 10% global, and 80% us stocks. So I take my calculation I've made and allocate that to my 80% us sp500 value stocks. Until a month ago, I was sp500 growth stocks. </p> <p>As you can see with this strategy, I've never exited the market but I have picked certain times when I want to switch which index will give me better returns.</p> <p>Cheers ? </p> <p>And I can provide the exact tickers I use if interested. But I picked my CRSP indexes because they are what vanguard uses exactly to balance their index funds, it could be different for you</p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/nrw28"> /u/nrw28 </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/ti2ur2/the_simplest_investing_strategy_i_use/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/ti2ur2/the_simplest_investing_strategy_i_use/">[comments]</a></span>Kind Regards R
<!-- SC_OFF --><div class="md"><p>We've all heard the phrase that time in the markets, beats timing the markets. But what if I told you that's it's possible to actually do both. Be in the markets 100% of the time while also being able to attempt to time big sell offs and rallies.</p> <p>This strategy relies on keeping money in the simplest low cost index funds, vanguard is a very great option but not the only one. I'll explain the concept first then how I apply it to my portfolio.</p> <p>The concept, is to use simple ratios to decide what major index is performing best. On trading view you can make a ratio by charting either an etf or the index, whatever you chose to use just he consistent. So you do up charts that look like Sp500/Nasdaq100 or sp500/dow30. I then add a 365 day sma to the chart.</p> <p>This line simply tells us, given the past 1 year of price action what index is outperforming the other? If our candles are above the sma, it shows strength in the index kn the numerator. If it's below the sma it's showing strength in the index in the denominator. The sma acts as a switch so to speak. </p> <p>We can go further with this. When you've analyzed these ratios you'll see the sp500 is dominant right now. So let's go further. Sp500/sp500 value. And sp500/sp500 growth. And sp500value/sp500 growth.</p> <p>If you chart these ratios you'll see sp500 value is currently performing the very best, relative to all the other indices.</p> <p>So what do we do with this information? I personally use it for my 401k. 10% bonds, 10% global, and 80% us stocks. So I take my calculation I've made and allocate that to my 80% us sp500 value stocks. Until a month ago, I was sp500 growth stocks. </p> <p>As you can see with this strategy, I've never exited the market but I have picked certain times when I want to switch which index will give me better returns.</p> <p>Cheers ? </p> <p>And I can provide the exact tickers I use if interested. But I picked my CRSP indexes because they are what vanguard uses exactly to balance their index funds, it could be different for you</p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/nrw28"> /u/nrw28 </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/ti2ur2/the_simplest_investing_strategy_i_use/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/ti2ur2/the_simplest_investing_strategy_i_use/">[comments]</a></span>Kind Regards R