9/20/2015 S.N.A.F.U. trading

Sector Model	XLE	-0.02%
Full Model	Date	Return	Days
PWR	3/9/2015	-13.24%	195
MTZ	4/9/2015	-8.07%	164
DRQ	5/15/2015	-17.90%	128
INT	7/7/2015	-21.68%	75
BT	8/11/2015	-10.74%	40
TM	8/12/2015	-7.90%	39
MMP	9/4/2015	-9.79%	16
CPK	9/8/2015	2.73%	12
ARLP	9/16/2015	0.77%	4
ED	9/17/2015	2.36%	3
(Since 5/31/2011)
S&P	Annualized	9.11%
Sector Model	Annualized	17.43%
Full Model	Annualized	12.15%
S&P	Total	45.56%
Sector Model	Total	99.78%
Full Model	Total	63.83%
Sector Model	Advantage	8.32%
Full Model	Advantage	3.04%
	Previous	2015
S&P	53.06%	-4.90%
Sector Model	142.84%	-17.73%
Full Model	101.13%	-18.55%

NOTE on XLE – in live trading I moved to XLI at 3:59, with XLE swinging back into the lead by a hair after the close.  If there is a favorable gap on Monday, I’ll move back to XLE in the morning.

The last three selections of the Full Model with the corrected adaptive metrics is a positive start.  Hopefully there will be no more disasters in that model.  That said, the true role for the Full Model will start to shift to long term holding during 2016.

But no major changes at the moment.

The Sector Model is right on its long term trend-line:

 

And the Sector ratios are still bearish:

Both models have suffered bear market style losses, even though the market averages haven’t gone further than a “correction.”  Unless someone is holding SPY, market averages aren’t all that meaningful.  Sectors and Industries have to crash in sync in order to be fully reflected in the averages.  If they decline in sequence investors will feel the pain of a bear and wonder why they are doing worse than if they were completely passive.

Active trading exacerbates both returns, and losses. And this year has been a time for the latter.

This is both normal, and painful. More, likely, is to come.

Tim