Trading
Indexes Newsletter 2007-1
January 6, 2007
FTI Staff
FTI System Trades and Returns for 2006
Actual Trades Using Guided Approach
The following are the lists of trades and results for 2006 for each of the
portfolios in the FTI Guided Approach. Included are trades for the
Brokerage-Available portfolio, the trades for the fund company portfolios
(Fidelity, T. Rowe Price, and Vanguard), and the trades for the annuities
(Fidelity VIP/VALIC). The trades can be verified from the FTI reports
and/or TI lists available to members.
Each strategy is assumed to have started with $100,000 on 12/31/05. We
use Fidelity for the brokerage account. Fidelity charges a short term
trading fee of $75 each time you sell or exchange shares of No Transaction Fee
(NTF) funds held less than 180 days (short-term trade). When a trade is
signaled for a mutual fund in a brokerage account, we assume that the sale is
made on the Monday following the trade signal and the proceeds (minus the
trading fee) used to buy the new fund on Tuesday. For individual mutual
fund accounts and annuities, the sale and subsequent purchase are both made on
Monday.
The year-to-date gains/losses are shown in percent at each transaction point to
mark the progress of each portfolio.
Brokerage-Available Portfolio:
|
12/31 |
|
Holding
PGERX at $18.83 |
5310.674
shares |
$100,000.00 |
|
|
|
3/13 |
|
Sell
PGERX at $19.94 |
5310.674
shares |
$106,457.13 |
|
|
|
3/14 |
|
Buy IZZYX
at $16.54 |
6436.344
shares |
$106,457.13 |
|
6.46% |
|
4/10 |
|
Sell
IZZYX at $16.76 |
6436.344
shares |
$107,798.13 |
|
|
|
4/11 |
|
Buy USCOX
at $9.35 |
11529.211
shares |
$107,798.13 |
|
7.80% |
|
5/30 |
|
Sell
USCOX at $8.99 |
11529.211
shares |
$102,536.13 |
|
1%
redemption fee |
|
5/31 |
|
Buy BEARX
at $5.99 |
17117.885
shares |
$102,536.13 |
|
2.54% |
|
8/21 |
|
Sell
BEARX at $6.01 |
17117.885
shares |
$102,803.49 |
|
|
|
8/22 |
|
Buy DODFX
at $40.29 |
2551.588
shares |
$102,803.49 |
|
2.80% |
|
9/18 |
|
Sell
DODFX at $39.97 |
2551.588
shares |
$101,986.98 |
|
|
|
9/19 |
|
Buy PVLDX
at $17.20 |
5929.476
shares |
$101,986.98 |
|
1.99% |
|
11/6 |
|
Sell
PVLDX at $17.91 |
5929.476
shares |
$106,196.91 |
|
|
|
11/7 |
|
Buy IZZYX
at $17.35 |
6120.859
shares |
$106,196.91 |
|
6.20% |
|
11/27 |
|
Sell
IZZYX at $13.10 |
8026.219
shares |
$105,143.47 |
|
shares
increased by dist. |
|
11/28 |
|
Buy GCHCX
at $17.34 |
6063.637
shares |
$105,143.47 |
|
5.14% |
|
12/29 |
|
Holding
GCHCX at $19.25 |
6063.637
shares |
$116,725.02 |
|
16.73% |
|
12/31 |
|
Holding
FPBFX at $25.67 |
3895.598
shares |
$100,000.00 |
|
|
|
2/21 |
|
Sell
FPBFX at $25.62 |
3895.598
shares |
$99,805.22 |
|
|
|
2/21 |
|
Buy FECAX
at $24.20 |
4124.183
shares |
$99,805.22 |
|
-0.19% |
|
6/12 |
|
Sell
FECAX at $24.28 |
4124.183
shares |
$100,135.15 |
|
|
|
6/12 |
|
Buy SPRXX
at $1.00 |
100135.155
shares |
$100,135.15 |
|
0.14% |
|
7/31 |
|
Sell
SPRXX at $1.00 |
100794.621
shares |
$100,794.62 |
|
shares
increased by interest |
|
7/31 |
|
Buy FEQIX
at $55.01 |
1832.296
shares |
$100,794.62 |
|
0.79% |
|
12/29 |
|
Holding
FEQIX at $58.55 |
1924.894
shares |
$112,702.56 |
|
12.7%
(shares increased by dist.) |
T. Rowe Price Funds:
|
12/31 |
|
Holding
PRGSX at $19.37 |
5162.623
shares |
$100,000.00 |
|
|
|
5/22 |
|
Sell
PRGSX at $19.83 |
5162.623
shares |
$102,374.81 |
|
|
|
5/22 |
|
Buy TSCXX
at $1.00 |
102374.81
shares |
$102,374.81 |
|
2.37% |
|
6/5 |
|
Sell
TSCXX at $1.00 |
102554.538
shares |
$102,554.54 |
|
shares
increased by interest |
|
6/5 |
|
Buy TRVLX
at $24.67 |
4157.055
shares |
$102,554.54 |
|
2.55% |
|
6/12 |
|
Sell TRVLX
at $24.02 |
4157.055
shares |
$99,852.45 |
|
|
|
6/12 |
|
Buy TSCXX
at $1.00 |
99852.453
shares |
$99,852.45 |
|
-0.15% |
|
7/31 |
|
Sell
TSCXX at $1.00 |
100494.333
shares |
$100,494.33 |
|
shares
increased by interest |
|
7/31 |
|
Buy PRFDX
at $27.24 |
3689.219
shares |
$100,494.33 |
|
0.49% |
|
11/27 |
|
Sell
PRFDX at $29.44 |
3689.219
shares |
$108,610.62 |
|
|
|
11/27 |
|
Buy PRGSX
at $22.97 |
4728.368
shares |
$108,610.62 |
|
8.61% |
|
12/29 |
|
Holding
PRGSX at $22.64 |
4955.734
shares |
$112,197.82 |
|
12.2%
(shares inreased by dist.) |
Vanguard:
|
12/31 |
|
Holding
VPACX at $11.34 |
8818.342
shares |
$100,000.00 |
|
|
|
1/23 |
|
Sell
VPACX at $11.40 |
8818.34215
shares |
$100,529.10 |
|
|
|
1/23 |
|
Buy VEIEX
at $20.25 |
4964.40003
shares |
$100,529.10 |
|
0.53% |
|
5/22 |
|
Sell
VEIEX at $20.35 |
4964.40003
shares |
$101,025.54 |
|
|
|
5/22 |
|
Buy VMMXX
at $1.00 |
101025.54053
shares |
$101,025.54 |
|
1.03% |
|
6/5 |
|
Sell
VMMXX at $1.00 |
101210.37806
shares |
$101,210.38 |
|
shares
increased by interest |
|
6/5 |
|
Buy VEURX
at $31.42 |
3221.20873
shares |
$101,210.38 |
|
1.21% |
|
6/12 |
|
Sell
VEURX at $29.61 |
3221.20873
shares |
$93,472.39 |
|
2%
redemption fee |
|
6/12 |
|
Buy VMMXX
at $1.00 |
93472.39083
shares |
$93,472.39 |
|
-6.53% |
|
7/10 |
|
Sell
VMMXX at $1.00 |
93787.22373
shares |
$93,787.22 |
|
shares
increased by interest |
|
7/10 |
|
Buy VIVAX
at $23.62 |
3970.66993
shares |
$93,787.22 |
|
-6.21% |
|
11/27 |
|
Sell
VIVAX at $25.27 |
3970.66993
shares |
$100,338.83 |
|
|
|
11/27 |
|
Buy VEIEX
at $23.18 |
4328.68115
shares |
$100,338.83 |
|
0.34% |
|
12/29 |
|
Holding
VEIEX at $24.27 |
4400.917
shares |
$106,810.26 |
|
6.81%
(shares increased by dist.) |
Fidelity VIP:
|
12/31 |
|
Holding
FAMEE at 17.878676 |
5593.25534
shares |
$100,000.00 |
|
|
|
5/22 |
|
Sell
FAMEE at 19.127955 |
5593.25534
shares |
106.987.54 |
|
|
|
5/22 |
|
Buy FAVMM
at 19.993927 |
5351.00165
shares |
106.987.54 |
|
6.99% |
|
6/5 |
|
Sell
FAVMM at 20.024540 |
5351.00165
shares |
$107,151.35 |
|
|
|
6/5 |
|
Buy FAVEI
at 60.393096 |
1774.23172
shares |
$107,151.35 |
|
7.15% |
|
6/12 |
|
Sell
FAVEI at 58.687548 |
1774.23172
shares |
$104,125.31 |
|
|
|
6/12 |
|
Buy FAVMM
at 20.048875 |
5195.87864
shares |
$104,125.31 |
|
4.13% |
|
7/24 |
|
Sell
FAVMM at 20.135905 |
5195.87864
shares |
$104,623.72 |
|
|
|
7/24 |
|
Buy FAMMT
at 19.436146 |
5382.94571
shares |
$104,623.72 |
|
4.62% |
|
10/30 |
|
Sell
FAMMT at 20.583000 |
5382.94571
shares |
$110,797.17 |
|
|
|
10/30 |
|
Buy FAVGO
at 13.230000 |
8374.69173
shares |
$110,797.17 |
|
10.80% |
|
12/26 |
|
Sell
FAVGO at 13.466541 |
8374.69173
shares |
$112,778.13 |
|
|
|
12/26 |
|
Buy FAMEE
at 23.561842 |
4786.47338
shares |
$112,778.13 |
|
12.78% |
|
12/29 |
|
Holding
FAMEE at 24.306669 |
4786.47338
shares |
$116,343.22 |
|
16.34% |
VALIC:
|
12/31 |
|
Holding
Fund 33 at 1.735068 |
57634.6287
shares |
$100,000.00 |
|
|
|
6/12 |
|
Sell Fund
33 at 1.761085 |
57634.6287
shares |
$101,499.48 |
|
|
|
6/12 |
|
Buy Fund
6 at 2.001448 |
50713.0238
shares |
$101,499.48 |
|
1.50% |
|
7/10 |
|
Sell Fund
6 at 2.007091 |
50713.0238
shares |
$101,785.65 |
|
|
|
7/10 |
|
Buy Fund
40 at 1.899941 |
53573.0603
shares |
$101,785.65 |
|
1.79% |
|
11/20 |
|
Sell Fund
40 at 2.055759 |
53573.0603
shares |
$110,133.30 |
|
|
|
11/20 |
|
Buy Fund
46 at 0.514146 |
214206.2777
shares |
$110,133.30 |
|
10.13% |
|
12/26 |
|
Sell Fund
46 at 0.498605 |
214206.2777
shares |
$106,804.32 |
|
|
|
12/26 |
|
Buy Fund
33 at 2.041962 |
52304.7545
shares |
$106,804.32 |
|
6.80% |
|
12/31 |
|
Holding
Fund 33 at 2.070514 |
52304.7545
shares |
$108,297.73 |
|
8.30% |
Summary for 2002-2006:
|
|
|
|
|
|
|
2004-2006 |
2002-2006 |
|
Brokerage/Company
Returns |
2006 |
2005 |
2004 |
2003 |
2002 |
Avg. Returns |
Avg. Returns |
|
Brokerage |
16.73% |
-6.42% |
-16.80% |
60.70% |
17.10% |
-2.16% |
14.26% |
|
Fidelity |
12.70% |
12.09% |
19.90% |
N/A |
N/A |
14.90% |
N/A |
|
T. Rowe
Price |
12.20% |
4.82% |
7.60% |
N/A |
N/A |
8.21% |
N/A |
|
Vanguard |
6.81% |
15.44% |
7.60% |
N/A |
N/A |
9.95% |
N/A |
|
Annuity
Returns |
|
|
|
|
|
|
|
|
Fidelity
VIP |
16.34% |
15.60% |
3.00% |
59.40% |
3.90% |
11.65% |
19.65% |
|
VALIC
403b |
8.30% |
17.70% |
8.30% |
38.70% |
13.40% |
11.43% |
17.28% |
|
Average
of 6 FTI Portfolios |
12.18% |
9.87% |
4.93% |
|
|
9.00% |
|
|
|
|
|
|
|
|
|
|
|
Market
Indexes |
|
|
|
|
|
|
|
|
DJIA |
16.29% |
-0.61% |
3.10% |
25.30% |
-16.80% |
6.26% |
5.46% |
|
S&P
500 |
13.62% |
3.00% |
9.00% |
26.40% |
-23.40% |
8.54% |
5.72% |
|
NASDAQ |
9.52% |
1.37% |
8.60% |
50.00% |
-31.50% |
6.50% |
7.60% |
|
Russell
2000 |
17.00% |
3.32% |
17.00% |
45.40% |
-21.60% |
12.44% |
12.22% |
|
Midcap
400 |
8.99% |
11.27% |
15.16% |
34.02% |
-15.45% |
11.81% |
10.80% |
Discussion:
For 2006, the average return of our 6 portfolios posted a double-digit gain of
12.18%. We finished ahead of both the
NASDAQ and Midcap 400 but behind the Dow, S&P 500 and Russell 2000. The 3-year average return of our 6
portfolios is 9.00%. The 5-year average
return of the brokerage portfolio, which we have been tracking since 2002, at
14.26%, still exceeds that of all major market indexes.
2006 started out strong for the FTI System. Our returns were in the double digits and well ahead of the market indexes until a 2-3 week steep and rapid market correction in May that wiped out most of our gains. In a 2-week stretch, the Russell 2000 lost nearly 10%. We coasted in the money market as the market continued to fall before bottoming out. In the late summer, we moved back into equities and rode a solid upward trend, finishing the year with a double-digit average return.
The FTI
System excels most strongly when there are pronounced and sustained trends in
the market. An example of this is both
2002 (strong bear market) and 2003 (strong bull market) when our returns were
well ahead of all major market indexes.
Back-testing in previous years reveals similar strong results. In 2004-2005, the market moved sideways most
of the time. This year, we were hurt by
a very quick market correction in the spring and the market didn’t rebound
until late in the year. Even in market
conditions least favorable for FTI, we still are able to keep our head above
the water, as is evident by our 3-year average return.
Newsletters 2003-14 and 2003-15, on "Choices and the
Time Value of Money" are good reading to see what a few percentage points
difference in annual returns on investments can make in the long run.
Past newsletters are available at:
http://www.fundtradingindexes.com/historical.htm.
To subscribe to the Weekly Trading Indexes and/or buy the book, click on www.fundtradingindexes.com and follow the instructions.
FTI Staff
Fund Trading Indexes