Good Morning, I had several folks express to me that they thought we should have moved to the G Fund instead of moving to the C Fund. They were concerned about taking losses given the short term dip. Having done this for 30 years, I can see where they are at. I’ve been there before early in my investment career. I learned from those mistakes. What mistakes you ask? The mistakes of making investment decisions based on the short term market and my emotions. First and foremost. Emotions will get you killed in this business. If you are making decisions on your emotions then you probably need to reassess your risk tolerance and invest in something that does not worry you so much. I can understand what triggers this. Your going to protect your capital come hell or high water and when it comes time to get back in the market you aren’t going to be lazy, your going to move your money quickly. You are going to take care of business! This is your chance at accruing wealth and your not going to miss it!!! When you have this kind of mentality you tend to focus on every new piece of news and the short term market that results from it.  90% of the time that will lead to underperformance or a loss, usually a loss. Unless you are extremely experienced and lets face it, most TSP traders aren’t, and/or you are set up to day trade you will never make money this way. Nevertheless, every time we are in a short term down trending market with our long term strategy, I will start getting messages from these well meaning but less experienced investors that have become uncomfortable watching the balance of their portfolio shift with the short term trends. The higher the volatility, the more messages I get. Once again, I know this, because this is where I was at also early in my investment career. I was going to protect my capital and I was going to make it grow and nothing was going to stop me. I was going to make it happen because that’s the way I did everything in my life. I had yet to learn some valuable lessons. The first of course was to depend on God instead of myself! The second was that a lot of news is noise and I was better off not listening to it. Third, I was trying to work in two time frames. I was trying to make money in the long term by looking at the short term. I would invest based on a long term chart or fundamentals and then jerk my money in and out of the market based on short term news or indicators which are more often than not misleading. I know this is no revelation to a lot of you, but that’s how the market makers make their money. They get you to sell and then buy in at a discount while leaving you holding the bag! So enough with that. That’s philosophy, if you are one of those new investors that finds yourself in this situation time and time again or finds yourself holding too long and losing performance in that manner. Then you need to reassess your risk tolerance. If you can’t stand to watch it then get into something you can. One other important thing. Stop looking at your balance every day! That will drive you nuts and lead you into bad decisions. Again, you are looking at short term developments and expecting long term results. One thing is for sure. No one in TSP can trade short term with only two trades a month. You couldn’t day trade even if you wanted to. So why are you checking the your portfolio daily as if you can? However, two trades a month will for the most part all0w you to follow the trend. There may be times when you are forced to buy and hold a little bit because you are out of trades, but most of the time you can effectively follow the trend and out perform those that buy and hold.  That’s what we do.

Speaking of  the above, our long term seems a lot better this morning. My what a difference a day makes. Eight democratic Senators broke with the Democratic Caucus this morning and voted for a temporary funding bill that is currently making it’s way through the House or Representatives. While we don’t have a budget deal yet, we are a lot closer than we have been since the shutdown began and the market is responding with a rally. However, understand one thing. If this bill gets stuck in the house the market will sell off just as fast as it moved up, maybe even faster. Nonetheless, our medium term indicators are telling us that the market will move higher in that timeline. So we will be patient while we wait for a deal…… and we will get a deal. Why? Because they have to, they have no choice, that’s why. Of course, we still have two other elephants in the room which are the Fed Meeting in December and AI stock valuations. Either one of those could present significant head winds. What they do will determine if we rally into the new year or not and if so by how much. Given the right conditions, we could still have a very nice year. In this particular case the reward far outweighs the risk and that is the reason we remain invested at 100/C. That noted, we will watch our allocation carefully moving into the end of the year and won’t hesitate to sell if our indicators tell us to do so as we believe there will be a correction of some kind after that time. We will see!

The days trading has  so far left us with the following results: Our TSP allotment is trading higher at +0.78%. For comparison, The Dow is flat at -0.02%. the Nasdaq is higher at +1.45%, and the S&P 500 is adding +0.78%. Praise God for the nice day!

Stocks rise as plan to end shutdown starts moving through Congress: Live updates

Last weeks action left us with the following signals: C-Hold, S-Sell, I-Buy, F-Sell. We are currently invested at 100/C. Our allocation is now +16.37% for the year not including the days results. Here are the latest posted results:

More Prices & Returns

God bless, Scott 

***Just a reminder that you can review the performance of our allocation at the Web Site TSPTALK.com in the autotracker section under the screen name KyFan1.

I produce and publish this blog as both a ministry and for the benefit of any Federal Government Employee. This is done to offer you some guidance as to how to approach your retirement more financially successful. When it is time for you to retire, I recommend you utilize the services of a Professional Money Manager, who works with a reputable investment firm. He understands the guidance you have already received and he can manage your savings assets utilizing a more advanced investment program into the future.

If you would like to receive more information about this introduction, please feel free to contact me at  KyFan1@aol.com.