Weekly Average Momentum Index (AMI) rankings of SSPP, nSSPP, SELECT, ETF have been posted at: http://yechen.pan.googlepages.com/
Major indexes experienced wild swings this past week and ended up in the loss column. Dow Jones Industrial Average lost 5 %, S&P 500 index lost 6.2% and NASDAQ Composite Index lost 7.9% for the week. As we discussed before, any rally in the bear market, which we are in now, will be short live and should be used as a sell opportunity to unload your position. Some people attempted to bottom fishing and got burned in the process because they can not act fast enough in this extremely volatile market. Economy is just entering recession, we have to let this bear run its course. Patient is virtue, and cash preservation is paramount not only for managing companies but also for managing personal portfolios in this economic condition.
I would like to share with you a good strategy from one of the investing blog on how to handle the fund holdings you currently have in case you did not unload them in time. Since we do not know if the market will go up or go down from here, sell half of the position regardless of the loss it incurs. For the remaining half, set a 5% loss threshold. That way, if the market goes up you will have some position in the market, and if the market goes down more than 5% from here, you will get out of the market completely.
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