Robert Drach's "Basic Timing" Model Portfolio
Bob Drach publishes his daily commentary and display portfolio to illustrate the "market timing" method of investing. (To learn more about Bob Drach, read this short biography.)Drach's Daily Commentary
November 24, 2009
Basic Timing
Daily commentary, current portfolio structure and history follow.
Please direct questions and comments to:
Drach Market Research
2910 Kerry Forest Parkway D4-210
Tallahassee FL 32309
Tel.: (850) 576-2680
E-Mail: DrachMkt@aol.com
Model Portfolio Position Changes: : None.
Major movements (+ or - one point or more among holdings): None.
Today’s uneventful session resulted in a miniscule gain for this portfolio model while broadly based measures and the most popular averages (Dow Industrial -17.24, S&P 500 -.59, Nasdaq Composite -6.83) posted mild losses.
Tomorrow brings a variety of economic reports including Durable Goods Orders, Personal Income/Spending/Consumption, Initial/Continuing Jobless Claims and New Home Sales.
Tomorrow also brings the last trading day before the Thanksgiving holiday, characterized by light volume as participants take advantage of an extended weekend (Friday is an abbreviated session).
Although the remainder of this week portends being dull, the underlying market condition ranks among the most dramatic in history.
Whatever the day by day activity, it is helpful to keep in mind we are into a combined monetary infusion cycle; defined/created by massive (Federal Reserve + legislated) economic stimulus actions.
When President Obama signed the $787 billion American Recovery and Reinvestment Act on February 17, the addition to already enacted stimulus measures (legislated and by the Federal Reserve) created the largest combined infusion cycle since creation of the Fed (an integral element) measured by both amount and variety.
Past combined infusion cycles have exhibited similar characteristics in sequential stages.
The initial up move is invariably explosive, followed by further advance via different patterns. The Dow’s 59% gain since the cyclical low set March 9 fits the norm.
We are now into a temporary stage characterized by choppy trading patterns. The duration of this stage could clarify around mid-December with many more stages to follow. This cycle has a long way to go.
Entering tomorrow (Wednesday) this portfolio has no indication to be attuned to changing positions. There is a possibility of shifting a position (selling and buying) on Friday.
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Portfolio model initiated 5/5/95, archived and marked to market daily.
Initial S&P 500 level 520.12, initial portfolio value $520,120.00
Current portfolio value $1,246.04, gain 139.57%.
These results are reflective as to capital capture and market price of current holdings, itemized below. They do not include cash dividends, interest earned on cash balances, transaction costs, or anything else.
Current Stock vs. Cash Allocation
$1,246,036.35 (100%) stock. $5.55 (0%) cash equivalents.
Summary of Closed Positions
| Total Positions | 401 | Average Position | |
| Profit | 360 (89.78%) | Percentage | + 7.26% |
| Loss | 41 (10.22%) | Days Held | 205 |
| Even | 0 ( 0.00%) | Annualized | + 12.93% |
Relative performance vs. S&P 500 since initiation (5/5/95)
| This Portfolio Model | +139% |
| S&P 500 | +112% |
