Close February 28, 2014
VTI closed the month at $ 97.40. This is 9.3% above its 200 day simple moving average of $89.11. It’s my barometer for staying long until March 31, 2014, unless, at some point during the month VTI closes 5% below its 52 week high ( $ 97.86 ) less 5 % = $ 92.97. That would get my attention and with other factors could cause me to lighten up by as much as 50% of my total invested position in the market. I would then wait until month end to determine the fate of the remaining 50% of my invested positions, ( or depending on tape momentum ) go back in. Since I am not in the December 31, 2011 VTI month end trade, I trade around it. For instance this week I liquidated my entire VTI position and replaced it with RPG ( Rydex SP 500 Pure Growth ). Since Jan 1, VTI is up 1.54% while RPG is up 6.55%. So, I’ve narrowed my diversification from 3500 to 500 stocks and tilted from balanced performance to pure growth. Its my expectation that as the market moves higher, momentum will grow more concentrated and RPG may evolve into OEF ( 100 names ) always with me keeping one eye on VTI and where it is in relation to its 200 day moving average. VTI is my canary because its been on the right side of the trend for 500 plus days. And, when the trend ends…..well, you know the rest.
Gold ( GLD ) $127.62 finished February above its 200 day moving average, $125.89. I could see by noon that this was in the cards, so I invested 7% of my liquid investment assets into GLD.
My February 18 ” Watch List ” QQEW / Zacks Portfolio finished the week with a gain of 0.30% versus 1.3 % gain for SPY. Since February 18 the Watch List portfolio has gained 2.53% while SPY has gained 1.11 %. The Leaders are TSLA 23.5%, GRMN 16.4% and WYNN 9.1% – The laggards are EXPD, negative 5.6%, MU, negative 3.5% and ADSK, negative 3.1%. Of the 20 entries, 7 are in negative territory. Which among this 20 has a compelling and sustainable competitive advantage over its competitors.? For me, that , and sustainable momentum, will be the factors that determine how long I tag along for the ride. Time for me to begin to get to know more about some of these names. But, be assured, nothing I learn will stop me from bailing out, at least temporarily, if VTI signals the party is over or specific momentum begins to sputter..
Richard Maurice Gore