Tactical Asset Allocation + HBPP an intriguing combo

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ochotona
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by ochotona » Mon Dec 31, 2018 6:54 pm

Dual Momentum GEM has issued a SELL signal today. I sold today, only have a 5.5% equity allocation now, will keep these.
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ochotona
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by ochotona » Fri Jan 04, 2019 11:13 am

Alpharchitect current allocations

Zero exposure to domestic equities.
Zero exposure to international equities.
Zero exposure to REITs.
Zero exposure to commodities
Half exposure to long-term bonds.
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by thisisallen » Fri Jan 04, 2019 10:24 pm

From Allocate Smartly:
(The site analyzes tactical asset allocation strategies)

“TAA’s performance to start the new year is likely to be extreme (either extremely good or extremely mediocre). As we show in the data dump below, TAA is now postured very defensively. The average allocation to defensive asset classes stands at 88%. Those are levels not seen since the 2008-09 Global Financial Crisis. If we see a strong market recovery to start the year, TAA is going to be left underperforming on the sidelines. But if recent market weakness continues, TAA is going to be riding high and dry. This remains a “hero or zero” moment for TAA.”
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ochotona
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by ochotona » Sat Jan 05, 2019 2:54 am

thisisallen wrote:
Fri Jan 04, 2019 10:24 pm
From Allocate Smartly:
(The site analyzes tactical asset allocation strategies)

“TAA’s performance to start the new year is likely to be extreme (either extremely good or extremely mediocre). As we show in the data dump below, TAA is now postured very defensively. The average allocation to defensive asset classes stands at 88%. Those are levels not seen since the 2008-09 Global Financial Crisis. If we see a strong market recovery to start the year, TAA is going to be left underperforming on the sidelines. But if recent market weakness continues, TAA is going to be riding high and dry. This remains a “hero or zero” moment for TAA.”
It's not a hero or zero moment for me. I'm going to judge it on where I stand in 2026, retirement day.
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by TrickPony » Wed Jan 09, 2019 12:05 pm

Looks like I sold low and will be buying back in high. Good recipe to end up in the poor house.
Kurt
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ochotona
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by ochotona » Wed Jan 09, 2019 2:00 pm

TrickPony wrote:
Wed Jan 09, 2019 12:05 pm
Looks like I sold low and will be buying back in high. Good recipe to end up in the poor house.
The month is not over! Maybe we get whipsawed back... but maybe not. Who can predict the stock market over the next 30, 60, 90 days? No one!

You most assuredly don't know that you'll end up in the poor house over the full duration of your portfolio life. Decades of data suggests otherwise, and you can verify it independently.

GEM lags in bull markets, but hugely leads in bear markets. Everyone should know this. There are lots of trades that don't work out, but the ones that do hit big. It's the same thing for the HBPP, or any disciplined investment strategy for that matter. If you're not prepared for a bad trade, don't be in the financial markets. Buy a CD.
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by HappyMan » Wed Jan 09, 2019 9:28 pm

ochotona wrote:
Wed Jan 09, 2019 2:00 pm

GEM lags in bull markets, but hugely leads in bear markets. Everyone should know this. There are lots of trades that don't work out, but the ones that do hit big. It's the same thing for the HBPP, or any disciplined investment strategy for that matter. If you're not prepared for a bad trade, don't be in the financial markets. Buy a CD.
This is a valuable piece of information. Thanks for sharing.
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buddtholomew
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by buddtholomew » Thu Jan 10, 2019 6:56 am

ochotona wrote:
Wed Jan 09, 2019 2:00 pm
TrickPony wrote:
Wed Jan 09, 2019 12:05 pm
Looks like I sold low and will be buying back in high. Good recipe to end up in the poor house.
The month is not over! Maybe we get whipsawed back... but maybe not. Who can predict the stock market over the next 30, 60, 90 days? No one!

You most assuredly don't know that you'll end up in the poor house over the full duration of your portfolio life. Decades of data suggests otherwise, and you can verify it independently.

GEM lags in bull markets, but hugely leads in bear markets. Everyone should know this. There are lots of trades that don't work out, but the ones that do hit big. It's the same thing for the HBPP, or any disciplined investment strategy for that matter. If you're not prepared for a bad trade, don't be in the financial markets. Buy a CD.
Ocho, you’re playing poker with your financial future (all-in, all-out) and rationalizing the outcome to a PP investor that incurs a loss from time to time.
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ochotona
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by ochotona » Fri Jan 11, 2019 10:06 am

buddtholomew wrote:
Thu Jan 10, 2019 6:56 am
Ocho, you’re playing poker with your financial future (all-in, all-out) and rationalizing the outcome to a PP investor that incurs a loss from time to time.
The data does not support that assertion.
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by buddtholomew » Fri Jan 11, 2019 12:20 pm

ochotona wrote:
Fri Jan 11, 2019 10:06 am
buddtholomew wrote:
Thu Jan 10, 2019 6:56 am
Ocho, you’re playing poker with your financial future (all-in, all-out) and rationalizing the outcome to a PP investor that incurs a loss from time to time.
The data does not support that assertion.
Just curious, can you answer these questions?
What were your stocks down YTD when the sell signal was triggered? How much more have you lost since the sell signal through yesterday? I suspect the answer is 15-20%. Compare that figure to a buy and hold investment over the same period. Is it worth it?
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ochotona
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by ochotona » Sat Jan 12, 2019 11:31 am

The sell signal was Dec 31. Judging one's strategy on a handful of days will never work no matter what the strategy. Think full market cycle.

Though if we get into a choppy whipsaw market, the thought of going to a buy and hold PP to wait out the vol storm seems appealing. PP has always been a great bear market allocation.
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Re: Dual Momentum GEM + HBPP a great combo, easy to test

Post by TrickPony » Sun Jan 13, 2019 11:23 am

I was thinking of keeping 50% of my portfolio in a pure HB PP & 50% in the GEM model. Under "risk of times" you would be 75% in stocks and in bad times only 25% equity. With this setup you always have a little skin in the game.
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