Buy Low(?)

There are a lot of ways to play this game.
For the record, I am a big believer in trend-following.  Picking tops and bottoms with any consistency is essentially impossible (at least in my opinion and/or experience).  So from that perspective going with the trend makes a lot of sense.  I am also a big believer in relative strength.  Much evidence over the years suggests that buying what is “already moving” is a very viable approach to investing.  Other studies have demonstrated pretty clearly that you are generally much more likely to succeed by buying stocks making new highs than by buying stocks making new lows.
These approaches make good sense and they work very well over time.  Despite this many (most?) investors still feel those pangs to “buy low” in hopes of getting in early and riding a major trend.  And the truth (I think) is that this can work too, if done correctly.
Like I said, there are a lot of ways to play this game.  But there is a definite “right” way and “wrong” way when it comes to “buying low.”
Buying Low (The Wrong Way): Buy things are plummeting or that have recently plummeted.
The Right Way (The Right Way): Buy things that have, a) plummeted, b) stopped plummeting and, c) have since been moving sideways for some period of time.
Last year I wrote about a “Buy Low” portfolio that I had concocted at the time.  Unfortunately, several of the ETFs involved have since ceased trading.  So in this piece I will introduce my updated “Buy Low” portfolio.  For the record – and as always – I am not “recommending” this portfolio.  It is essentially an experiment in one alternative approach to investing.
The “Buy Low” Portfolio
The Buy Low Portfolio consists of the following ETF’s and ETN’s:
CANE – Tecrium Sugar
JJOFF – Coffee Subindex Total Return
DBA – PowerShares Agricultural
WEAT – Tecrium Wheat
GLD – StreetTracks Gold Trust
PPLT – ETFS Physical Platinum Shares
SLV – iShares Silver Trust
GDX – Market Vectors Gold Miners
UNG – United States Natural Gas
URA – Global X Uranium
Monthly charts for these tickers appear in Figures 1 through 3.  A chart of the composite index I created by combining all of these appears in Figure 4 (Click any chart to enlarge).
1aFigure 1 – CANE/DBA/GDX/GLD (courtesy AIQ TradingExpert Pro)
2Figure 2 – JJOFF/PPLT/SLV/UNG (courtesy AIQ TradingExpert Pro)
3Figure 3 – URA/UNG (courtesy AIQ TradingExpert Pro)
4Figure 4 – Buy Low Composite Index (courtesy AIQ TradingExpert Pro)
Editors note: To create an index like Jay’s Trending Low, follow the instructions at the end of this article ‘Creating an index for a group of tickers in Data Manager’
Summary
Securities that have plummeted in price and then moved sideways for a period of time can (unfortunately) continue to move sideways for quite a while longer before (hopefully) breaking out to the upside.  Even worst, they can also fail and breakdown through the previous low. But extended consolidation patterns are often followed by something good.
As you can see all of the tickers in the list above are commodity related.  As I’ve written about here and here there is reason to believe that commodities will outperform in the years ahead.  That being said, with the stock market rallying in the near-term and with the U.S. Dollar strong there is no compelling reason to think that this “Buy Low Portfolio” is going to make a lot of  headway anytime soon.
The Index in Figure 4 is presently 8.2% above its January 2016 low.  As long as that low holds I’ll give this experiment more time to work out.
Jay Kaeppel
Disclaimer:  The data presented herein were obtained from various third-party sources.  While I believe the data to be reliable, no representation is made as to, and no responsibility, warranty or liability is accepted for the accuracy or completeness of such information.  The information, opinions and ideas expressed herein are for informational and educational purposes only and do not constitute and should not be construed as investment advice, an advertisement or offering of investment advisory services, or an offer to sell or a solicitation to buy any security.
Creating an index for a group of tickers in Data Manager


NOTE: tickers with X in list need to be added to the Data Manager as new tickers and downloaded from your data service

When you create an index for a group of tickers, you can display a chart of the index as well as the underlying tickers. A group index can be analyzed on charts using technical indicators, and Expert Ratings are generated for the group index (except for mutual fund
groups).

The procedure for creating an index for a group of tickers is as follows:

  • First, create a group ticker for the index.
  • Then create a list to insert the group ticker into.
  • Add tickers to the group.
  • Finally, create the index by executing the Compute Group/Sector Indices function.


To create an index for a group of tickers, follow the steps below.

First, create a group ticker:

1. First, add a new group ticker to your Master Ticker List. Select the
Ticker command on the menu bar. Then select New to display the
New Ticker dialog box.
2. Enter a ticker for the new group, then be sure to enter the proper
Type designation (group or mutual fund group).
3. Click OK, and the second dialog box for entering a new ticker
appears.
4. Type in a name (Description) and the First Date for data. The
remaining default settings on this second dialog box can remain the
same.
5. Click OK and the group ticker is added to your Master Ticker List.

Then, create a list to insert the group ticker into:

1. Select the List command on the menu bar.
2. Select New on the drop-down menu and a dialog box appears.
3. Type in a name (8 characters maximum) in the text box.
4. Click OK and the list name appears in the Selected List text box
located on the toolbar.
5. The list name is also displayed in the List window. Insert the group
ticker from your Master Ticker List under the list name. To insert a ticker directly under a list, do the following:

  • Highlight (by clicking) the group ticker in the Master Ticker List.
  • Click the list name in the List window.
  • Click the Insert to List button on the toolbar (or select the Insert Ticker command from the List sub-menu).
  • The group ticker will appear in the List window under the list name.

6. Next, insert tickers into the group. To insert tickers into a group:
Under the new group, insert all of the tickers that will make up the
group by doing the following:

  • Select the group ticker in the List window by clicking on it.
  • Select in your Master Ticker List the tickers that you want to add to the group. If you are inserting multiple tickers, hold down the Ctrl key while clicking each ticker.
  • Click the Insert to List button on the toolbar (or select the Insert Ticker command from the List sub-menu).
  • The tickers will appear in the List window under the group ticker.

7. Finally, compute the index for the new group. To compute a group index:

  • Select Compute Group/Sector Indices from the Utilities sub-menu.
  • In the Compute Group/Sector Indices dialog box, click the Compute List(s) option button.
  • In the text box for Compute List(s), select the name of the list you created above.
  • Under Range, choose Update from Last Date of Data and click OK.

72 thoughts on “Buy Low(?)

  1. I’m really loving the theme/design of your weblog.
    Do you ever run into any browser compatibility issues?
    A small number of my blog visitors have complained about my blog not operating correctly in Explorer but looks great in Safari.
    Do you have any ideas to help fix this problem?

  2. I intended to draft you one little observation to help thank you so much once again for your personal lovely knowledge you’ve discussed at this time. This is quite seriously open-handed with you to convey unreservedly all that most people might have offered for sale for an ebook in order to make some money for their own end, mostly now that you might well have tried it if you considered necessary. The guidelines additionally worked to become fantastic way to recognize that the rest have similar eagerness just like mine to find out more with respect to this problem. Certainly there are thousands of more fun occasions ahead for those who view your blog.

  3. I’m also writing to let you know what a incredible encounter my princess experienced reading through your site. She realized a lot of details, with the inclusion of how it is like to have a great coaching mood to let others easily learn about specific multifaceted topics. You really did more than our expected results. Many thanks for providing these precious, trusted, edifying as well as fun tips on that topic to Julie.

  4. Hello mates, its impressive article on the topic of
    tutoringand entirely defined, keep it up all the time.

  5. Useful info. Lucky me I found your web site by accident, and
    I’m stunned why this accident didn’t happened in advance! I bookmarked it.

  6. I simply want to tell you that I am all new to blogging and certainly liked this web page. More than likely I’m likely to bookmark your blog post . You absolutely come with wonderful writings. Many thanks for sharing your webpage.

  7. This design is steller! You definitely know how to keep a reader entertained.
    Between your wit and your videos, I was almost moved to start my own blog (well,
    almost…HaHa!) Excellent job. I really enjoyed what
    you had to say, and more than that, how you presented it. Too cool!

  8. of course like your website however you have to check the spelling on quite a few of your posts. Several of them are rife with spelling issues and I to find it very troublesome to tell the reality nevertheless I will certainly come back again.

  9. I think this is among the so much important info for me.
    And i am glad studying your article. But wanna commentary
    on few basic issues, The website style is great, the articles
    is in reality nice : D. Excellent activity, cheers

  10. I must show appreciation to this writer for bailing me out of this setting. As a result of searching through the internet and finding advice which were not pleasant, I was thinking my entire life was well over. Being alive devoid of the approaches to the difficulties you have resolved all through your website is a crucial case, as well as ones which may have badly damaged my entire career if I hadn’t come across your website. The ability and kindness in maneuvering all the pieces was very helpful. I don’t know what I would have done if I hadn’t encountered such a subject like this. I can also at this moment relish my future. Thanks for your time very much for your impressive and result oriented help. I will not think twice to propose your web page to any person who ought to have recommendations on this area.

  11. What i do not realize is actually how you’re no longer actually a lot more well-preferred than you may be right now. You are very intelligent. You recognize therefore considerably relating to this subject, produced me individually imagine it from a lot of varied angles. Its like women and men aren’t fascinated until it is one thing to accomplish with Lady gaga! Your own stuffs excellent. At all times care for it up!

  12. Thanks for your concepts. One thing I’ve noticed is banks and also financial institutions know the spending habits of consumers plus understand that a lot of people max out there their own credit cards around the breaks. They correctly take advantage of this fact and start flooding the inbox and also snail-mail box having hundreds of Zero APR credit cards offers shortly when the holiday season comes to an end. Knowing that in case you are like 98 of American community, you’ll jump at the possible opportunity to consolidate card debt and shift balances to 0 rate credit cards.

  13. Hey very nice web site!! Man .. Beautiful .. Wonderful .. I’ll bookmark your web site and take the feeds additionally…I’m glad to search out a lot of useful info here within the submit, we need work out more techniques on this regard, thanks for sharing.

  14. I precisely needed to say thanks again. I am not sure the things I could possibly have gone through without those opinions provided by you relating to such a area of interest. It became a real daunting circumstance for me personally, however , spending time with a new skilled avenue you dealt with the issue forced me to weep with contentment. I will be happier for this help and as well , expect you are aware of a great job you are always putting in teaching other individuals with the aid of your site. I’m certain you’ve never come across all of us.

  15. Thanks for the auspicious writeup. It if truth be told was once a amusement account it. Look advanced to far brought agreeable from you! However, how could we communicate?

  16. I have mastered some essential things through your site post. One other point I would like to say is that there are many games available and which are designed in particular for toddler age little ones. They consist of pattern acceptance, colors, family pets, and forms. These usually focus on familiarization as opposed to memorization. This helps to keep children and kids engaged without having a sensation like they are learning. Thanks

  17. I like this post, enjoyed this one thank you for putting up. “To the dull mind all nature is leaden. To the illumined mind the whole world sparkles with light.” by Ralph Waldo Emerson.

  18. We’re a group of volunteers and starting a new scheme in our community.
    Your site offered us with valuable information to work on. You’ve done a formidable job
    and our entire community will be grateful to you.

  19. Excellent site. Plenty of useful info here. I am sending it to some friends ans also sharing in delicious. And of course, thanks for your effort!

  20. I would like to thnkx for the efforts you’ve put in writing this blog. I’m hoping the same high-grade blog post from you in the upcoming as well. In fact your creative writing abilities has inspired me to get my own site now. Actually the blogging is spreading its wings rapidly. Your write up is a great example of it.

  21. hello there and thank you to your information – I’ve certainly picked up something new from proper here. I did alternatively expertise a few technical issues the usage of this site, as I skilled to reload the site lots of instances previous to I could get it to load properly. I were puzzling over if your hosting is OK? Now not that I am complaining, but sluggish loading circumstances times will often have an effect on your placement in google and could injury your quality score if ads and ***********|advertising|advertising|advertising and *********** with Adwords. Well I’m including this RSS to my e-mail and could look out for a lot extra of your respective exciting content. Make sure you update this again very soon..

  22. Hey I am so excited I found your site, I really found you by mistake, while I was researching on Aol for something else, Anyways I am here now and would just like to say many thanks for a incredible post and a all round entertaining blog (I also love the theme/design), I don’t have time to read through it all at the moment but I have book-marked it and also included your RSS feeds, so when I have time I will be back to read a great deal more, Please do keep up the excellent work.

  23. Somebody essentially help to make seriously posts I might state. This is the very first time I frequented your web page and to this point? I amazed with the research you made to create this actual submit incredible. Magnificent activity!

  24. Fantastic beat ! I wish to apprentice while you amend your site, how could i subscribe for a weblog web site? The account aided me a acceptable deal. I had been tiny bit familiar of this your broadcast provided vibrant clear idea

  25. You really make it seem so easy with your presentation but I find this topic to be actually something that I think I would never understand. It seems too complicated and very broad for me. I’m looking forward for your next post, I’ll try to get the hang of it!

  26. You can definitely see your skills in the work you write. The world hopes for more passionate writers like you who aren’t afraid to say how they believe. Always follow your heart.

  27. Great write-up, I’m regular visitor of one’s website, maintain up the nice operate, and It is going to be a regular visitor for a lengthy time.

  28. I loved as much as you will receive carried out right here. The sketch is attractive, your authored subject matter stylish. nonetheless, you command get bought an edginess over that you wish be delivering the following. unwell unquestionably come more formerly again since exactly the same nearly a lot often inside case you shield this hike.

  29. fantastic post, very informative. I wonder why the other specialists of this sector do not notice this. You should continue your writing. I am sure, you’ve a huge readers’ base already!

  30. This is the proper blog for anybody who needs to search out out about this topic. You understand a lot its virtually arduous to argue with you (not that I actually would need…HaHa). You undoubtedly put a new spin on a subject thats been written about for years. Great stuff, simply great!

  31. Hey there, I think your blog might be having browser compatibility issues. When I look at your blog in Firefox, it looks fine but when opening in Internet Explorer, it has some overlapping. I just wanted to give you a quick heads up! Other then that, very good blog!

  32. You can certainly see your expertise in the work you write. The world hopes for more passionate writers like you who aren’t afraid to say how they believe. Always follow your heart.

  33. There are actually a lot of details like that to take into consideration. That is a nice level to convey up. I provide the ideas above as basic inspiration but clearly there are questions like the one you convey up the place an important factor might be working in honest good faith. I don?t know if best practices have emerged round things like that, however I am positive that your job is clearly identified as a good game. Both girls and boys really feel the affect of just a second’s pleasure, for the remainder of their lives.

  34. Thanks for another great article. Where else could anybody get that kind of information in such a perfect way of writing? I’ve a presentation next week, and I am on the look for such information.

  35. Hi there, You have performed an excellent job. I will definitely digg it and individually recommend to my friends. I’m sure they’ll be benefited from this site.

  36. Excellent items from you, man. I’ve bear in mind your stuff previous to and you’re just extremely fantastic. I really like what you’ve received here, really like what you are stating and the way in which through which you say it. You’re making it entertaining and you still take care of to keep it wise. I can not wait to read far more from you. This is actually a great web site.

  37. My wife and i have been really delighted Ervin could finish off his preliminary research because of the precious recommendations he obtained through the web page. It is now and again perplexing to simply continually be handing out ideas some others have been trying to sell. We really figure out we need the blog owner to appreciate for this. All of the explanations you made, the simple blog menu, the friendships you will give support to promote – it is mostly impressive, and it is facilitating our son and us do think that article is fun, and that’s really serious. Thanks for the whole thing!

  38. Have you ever considered about adding a little bit more than just your articles? I mean, what you say is important and all. But imagine if you added some great images or video clips to give your posts more, “pop”! Your content is excellent but with pics and videos, this blog could definitely be one of the most beneficial in its niche. Excellent blog!

  39. I’ve learned several important things through your post. I might also like to mention that there might be situation in which you will have a loan and do not need a cosigner such as a Fed Student Aid Loan. But if you are getting financing through a traditional bank or investment company then you need to be ready to have a cosigner ready to help you. The lenders may base their decision on a few components but the biggest will be your credit standing. There are some creditors that will in addition look at your work history and choose based on that but in most cases it will be based on on your report.

  40. Its like you read my thoughts! You appear to understand so much approximately this, such as you wrote the guide in it or something. I believe that you could do with a few p.c. to drive the message house a bit, but other than that, that is magnificent blog. A fantastic read. I’ll certainly be back.

  41. Wow that was strange. I just wrote an really long comment but after I clicked submit my comment didn’t appear. Grrrr… well I’m not writing all that over again. Anyway, just wanted to say excellent blog!

  42. Unwilling sportsmen he in questions september therefore described so. Attacks may set few believe moments was. Reasonably how possession shy way introduced age inquietude. Missed he engage no exeter of. Still tried means we aware order among on. Eldest father can design tastes did joy settle. Roused future he ye an marked. Arose mr rapid in so vexed words. Gay welcome led add lasting chiefly say looking.

  43. I haven’t checked in here for a while since I thought it was getting boring, but the last several posts are good quality so I guess I will add you back to my everyday bloglist. You deserve it my friend 🙂

  44. Someone necessarily assist to make critically posts I would state. That is the first time I frequented your web page and thus far? I surprised with the research you made to make this actual publish incredible. Excellent job!

  45. Wow! Thank you! I constantly needed to write on my site something like that. Can I include a part of your post to my website?

Leave a Reply

Your email address will not be published.