Good Evening, The volatility continued today albeit with a much different result than yesterday. Investors have been concerned recently with the Fed, an economic slowdown, and trade with China making the market most uncomfortable.  All those issues were addressed today creating a euphoric feeling that turned into a monster rally. You can read about that in the news link below. Remember when we talked about volatility in the current market? We discussed how bad news could take the market down hard and good news could make for a big rally? How you could make a lot one day and lose it all the next??? This is what we were talking about. Volatility isn’t just one way. It works a lot like a Bi-Polar psychological diagnosis. It is manic one day and extremely depressed another but hardly ever calm. We also talked about how bottoming is a process. A process that starts with a rally. The thing about it is that any rally could be the beginning of the bottom of a downtrend. You really won’t know that you are in an uptrend until you have a series of higher highs and higher lows and it takes a little time for that to happen. We often refer to that period of time as a market turn. Investing in equities during a turn can make you big money but it can also lose big money. It is a high risk high reward period. Why?? Because you are trying to call the bottom and no one really knows when that will come. Was today a bottom? I really don’t know. There’s no chart that will tell us if today was the beginning of a bottom. Investing now may be lucrative or it may be a bust. Only time will tell. A good trend following system like we use will not put us in the market first. It will allow us to manage risk by putting us in the market when we have the greatest chance for success. Case in point. Today was good but how about yesterday? We seek to enter the market when there is an extremely low probability that we will have a day like yesterday. Sure there were folks that were in the market and made a lot of money today, but most of them paid a terrible price to be there. Do you thing they made all the money back that they lost in December?? My point is this. They can make some money during the turn. Let them have their’s. After all, they paid for it. Our goal is not to be the first in the market. Our goal is to get in the market when it is moving up. We are not dealing with mad money here. We are dealing with retirement money!! Its not what you make that’s important. It’s what you keep! Keep more and in the long run you’ll make more. 

The days rally left us with the following results: Our TSP allotment was steady in the G Fund. For comparison, the Dow gained +3.31%, the Nasdaq +4.26%, and the S&P 500 +3.43%. Is the bottom in?? We will see.

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  [email protected].