Month: December 2015

This week’s podcast, The Disciplined Investor with Andrew Horwitz, CFP, featured an interview with Tom McClellan. McClellan publishes several market newsletters. He has been watching the Euro dollar futures contract as an indicator of market direction. He claims it has worked well for many years in predicting the stock market a year ahead. He says it called for an August top this year, with a contunued decline until April and then not any direction until an up trend in October. Information on his news letter is available at www.mcoscillator.com. The site has a lot of interesting charts and while there you can sign up for a free chart “In focus weekly” email.

Returns for the month of November were negative.
In October IRA#1 -5%, IRA#2 -2%, PDP PIE PIZ DWAS -4%, QQQ -4%, SPY/RSP -6%, DWTR -1%.
For the last 3 months, IRA#1 -2%, IRS#2 -1%, PDPetc 0%, QQQ 3%, SPY/RSP -5%, DWTR -1%.
September portfolio changes:
IRA#1 – Sold FSRPX 11/16, Purchased FSRPX 11/30
IRA#2 – Purchased FSCPX 11/02, FSPTX 11/09, Sold FSRPX 11/16, Purchased FSRPX 11/30
PDP PIE PIX DWAS – none
QQQ – Sold QQQ 11/16, Purchased QQQ 11/19
SPY/RSP – Sold SPY 11/15, Purchased SPY 11/19
DWTR was power 4 – Purchased PSL 10/06, PXI 10/12, sold PXI, PSL 10/19, purchased DWTR 10/19

IBD TBP’s Market Pulse is “Market in Correction” as of 12/13/15 – Not a time to buy.

My current investments:
IRA#1 and IRA#2
SRetailing has a price of 105.33, a sell price of 103.16, a rank of 01, and is a Hold. (ETF – XLY)
IRA#2
SSoftware&ComputerServices has a price of 121.93, a sell price 118.38, a rank of 02, and is a Hold. (ETF – MTK)
SConsumerDiscretionary has a price of 34.40, a sell price of 33.88, a rank of 26, and is a Hold. (ETF – FDIS)
STechnology has a price of 119.24, a sell price of 115.61, a rank of 08, and is a Hold. (ETF – IGM)
SITServices was sold, but the ETF which matched its performance, XLK, has not declined 7% from its highest daily close – yet. I owned SITServices for 63 days and sold it for a 2.64% loss (including distributions) and is up 0.14% since sold. XLK was up 1.18% over the same period and is up 0.65% since. They obviously did not own the same stocks but had similar performance for the 3 months prior to purchase.

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 100% invested
IRA #2 – 80% invested

“Last week, Third Avenue Focused Credit Fund suspended investor redemptions, and credit markets reacted violently. This was the first time mutual fund investors were similarly gated since the financial crisis of 2008. However, the $788.5 million Third Avenue fund might be the tip of the iceberg.”
http://finance.yahoo.com/news/why-the-current-credit-crisis-might-be-35-times-worse-than-you-thought-134706002.html
Contains a list in this URL which names the 35 funds which may freeze customer sales. If you own one of these mutual funds, I suggest you sell while you can.

Talking to Fidelity, they explained that the their list of “all” Fidelity fund distributions does not contain all Fidelity fund distributions. Turns out that there is not list of all Fidelity fund distributions. And again, calling Fidelity and entering your userid and password results in a longer wait than just calling Fidelity without identifying yourself. So their fund data not always easy to use and their phone support is not good.

Any time CashReserves, which never goes up, is on your top 20 funds, you know you are in a down market.

IBD TBP’s Market Pulse is “Uptrend under pressure” as of 12/18/15 – Not a time to buy. The Market Pulse went to Confirmed Uptrend on 12/16/15 and then to Uptrend under pressure.

My current investments:
IRA#1 and IRA#2
SRetailing has a price of 104.49, a sell price of 103.16, a rank of 01, and is a Hold. (ETF – XLY) – DIS
IRA#2
SITServices has a price of 39.43, a sell price 39.62, a rank of 13, and is a Sell. (ETF – XLK) -DIS
SSoftware&ComputerServices has a price of 122.87, a sell price 121.89, a rank of 02, and is a Hold. (ETF – MTK) – DIS
SConsumerDiscretionary has a price of 33.92, a sell price of 33.88, a rank of 19, and is a Hold. (ETF – FDIS) – DIS
STechnology has a price of 116.82, a sell price of 115.61, a rank of 08, and is a Hold. (ETF – IGM)
Four of these funds has a distribution which changes their sell price.

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – Sell SITservices

My portfolio market exposure after this weekend’s changes:
IRA #1 – 100% invested
IRA #2 – 80% invested

The price of copper has been an indicator of the state of world economic health because it is vital to so many industries. The price of copper has declined by 50% over the last 5 years. Another indicator of ecomomic health is the price of oil since it is also a vital part of the economy. The ETF which follows the price of OIL is USO. USO started trading at $68 when it opened in April 2006. It is now trading for under $12 or a decline of 80%. USO traded at $114 in 2008. I do not know what the drop in almost every commodity price is saying about the future of the world economy, but it does not look good. It nice to see oil decline and pay lower gas prices, but oil companies are probably the biggest investment positions in most major retirement funds.
I was talking with a couple from Brazil a week ago. They indicated since Brazil is dependent on commodity prices and also has serious political corruption (sound familiar?) the country is a depression. When I went to Brazil 8 years ago the Brazilian Real was worth $0.50 and now is worth $0.25. The couple indicated I should visit Brazil again because everything is so much cheaper than when I was there before. I did not mention I had a very small gain in BZQ (ProShares UltraShort MSCI Brazil Capped ETF) during the year.

So I talked to Fidelity last week and they had no solution for their failure to report distribution. The price of a fund is automatically reduced by the value of a distribution. So with major distributions not being reported today, I apent 90 minutes on the phone to Fidelity. Last week the agent said I could not look at fund details to see the distributions because they are not updated until Monday. This week the agent said I should look at the fund details to see distributions. I suggested looking at details for 100 funds was not practical. So Fidelity does not produce an accurate way to determine the exact price change of a fund. This is nothing new, it is just worse. I have complained for years about the problem which takes place every December. Somehow they just fail every December (and probably during the year, it is just not as obvious).
I used an estimate of the distribution for many of the funds and will be correcting it on Monday (Fidelity claims it will be fixed then). I do not plan to send out a new list, just include the correct numbers next week.

IBD TBP’s Market Pulse is “Market in Correction” as of 12/13/15 – Not a time to buy.

My current investments:
IRA#1 and IRA#2
SRetailing has a price of 104.39, a sell price of 103.24, a rank of 01, and is a Hold. (ETF – XLY)
IRA#2
SITServices has a price of 40.01, a sell price 39.98, a rank of 08, and is a Hold. (ETF – XLK)
SSoftware&ComputerServices has a price of 122.87, a sell price 121.89, a rank of 02, and is a Hold. (ETF – MTK)
SConsumerDiscretionary has a price of 34.45, a sell price of 34.44, a rank of 18, and is a Hold. (ETF – FDIS)
STechnology has a price of 116.53, a sell price of 115.61, a rank of 06, and is a Hold. (ETF – IGM)
I am happy (I think)  and surprised that none of the funds declined below their sell price.

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 100% invested
IRA #2 – 100% invested

A lot of Fidelity funds had a distribution this weekend and the distributions will continue weekly until 2016. I strongly suggest you not have the distributions reinvested into the fund which paid them. That represents a fund purchase of a fund you may not to buy or may be ready to sell. You have to call Fidelity to get that done.
As I reviewed the list of distributions this weekend, based on the price change in the fund (which declines by about the same amount as the distribution) I found a fund which had a distribution Fidelity did not report. I called Fidelity and verified that. In fact I made two calls at the same time. On one I indicated I was not a client and was able to talk to a  representative immediately and after 3 minutes of discussion, he gave me the information and agreed it was not reported. On the other I identified myself with userid and password and waited 31 minutes to talk to a representative. It took me 5 minutes of discussion to have him come to the same conclusion. On both calls I requested Fidelity provide better phone service to customers. Fidelity has been providing rotten phone service on weekends to customers for months and I’ve written them 3 times about it without success.

David Stockman produces a Contra Corner email each day. In the one on 12/05 there was an article titled “Bill Gross: De-risk Now, Wile E. Coyote Time Is Near”. “One day the negative feedback loop on the real economy will halt the ascent of stock and bond prices and investors will look around like Wile E. Coyote wondering how far is down.” Mr. Gross is the former manager of the world’s largest bond fund who joined Janus Capital Group last year.

IBD TBP’s Market Pulse is “Uptrend under pressure” as of 12/03/15 – Not a time to buy.
IBD TBP’s Market Pulse was “Confirmed Uptrend” for only 15 days before the 12/03 change.

My current investments:
IRA#1 and IRA#2
SRetailing has a price of 108.67, a sell price of 103.24, a rank of 01, and is a Hold. (ETF – XLY)
IRA#2
SITServices has a price of 41.84, a sell price 39.98, a rank of 05, and is a Hold. (ETF – XLK)
SSoftware&ComputerServices has a price of 128.30, a sell price 121.89, a rank of 02, and is a Hold. (ETF – MTK)
SConsumerDiscretionary has a price of 36.06, a sell price of 34.44, a rank of 11, and is a Hold. (ETF – FDIS)
STechnology has a price of 121.67, a sell price of 115.61, a rank of 06, and is a Hold. (ETF – IGM) The sell price was adjusted for a distribution.

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 100% invested
IRA #2 – 100% invested