3/12/2017 Mr. Market Is Washing Pills Down With A Beer

Sector Model	XLU	0.66%
Full Model	Date	Return	Days
BT	8/11/2015	-39.38%	579
DY	10/30/2015	25.38%	499
TMK	11/23/2015	30.91%	475
UPLMQ	12/1/2015	59.95%	467
NVR	12/16/2015	23.11%	452
CMP	2/19/2016	10.12%	387
NVR	2/22/2016	28.30%	384
ENOC	3/15/2016	-27.60%	362
AMWD	3/17/2016	26.12%	360
CASY	5/12/2016	-4.02%	304
AVB	5/24/2016	0.93%	292
AEM	6/7/2016	-17.49%	278
ESRX	6/13/2016	-10.89%	272
AMED	6/16/2016	-0.28%	269
FRO	6/27/2016	-9.68%	258
ASTE	7/12/2016	4.71%	243
MFC	9/1/2016	33.90%	192
SFM	9/8/2016	-9.30%	185
CFFN	9/12/2016	6.59%	181
FIG	12/6/2016	57.09%	96
(Since 5/31/2011)
S&P	Annualized	10.31%
Sector Model	Annualized	16.41%
Full Model	Annualized	12.68%
S&P	Total	76.38%
Sector Model	Total	140.81%
Full Model	Total	99.43%
Sector Model	Advantage	6.10%
Full Model	Advantage	2.37%
	Previous	2017
S&P	66.43%	5.97%
Sector Model	120.54%	9.19%
Full Model	91.27%	4.26%

The market has been on a tear since election day.  The debate continues to rage about whether the market should go up or down, or whether it is overpriced or ready to soar.

Given enough time, the market goes up.  But not all of us have the same amount of time, or we don’t feel we can stand a dip in the market.  How do we avoid losing money?

We cannot avoid losing money, but I do know a way to guarantee losing money: jump in and out.  And if you want to lose money really fast, go short.  Oh, you might win on occasion, but the odds are always stacked against you.

That’s the insidious part of investing – the more you try to avoid losing money, the more aggressively you cause it to happen.

That doesn’t mean that all investments are equal.  They aren’t.  Neither are all industries.  And right now the most pessimistic industries are selling at a bargain.  Here are the model’s favorites:

BEVERAGE

DRUGSTOR

ELECFGN

GASDISTR

NWSPAPER

POWER

PPEQ

REIT

UTILCENT

UTILEAST

UTILWEST

Just eyeball them.  They pretty much have one thing in common: these are industries you have to do business with, instead of ones you want to do business with.

Mr. Market is washing pills down with a beer, reading a newspaper in his rental and listening to a radio with Chinese made earphones while his piped-gas power utility is keeping him warm from the looming snowstorm.

Dido sings snappier tunes than this market would know how to dance to.

So, do we get out and short the market?  Well, you can – but I’ll just look at the debris of sad industries and try to find a stock I might hold for a while.  At the moment I’m looking strongly at GNRC in the POWER industry.  Perhaps... if the price is right...

 Tim