I offer no explanation, although I’m sure if I watched Bloomers or CNBC tonight, I’d hear plenty of explanations. Feel free to provide the most outrageously stupid one that you hear or read in the comments.

Here are some of the questions he had for me:

Personal Performance:
How have you fared so far in ‘08?
What’s been your greatest success this year?
What’s been your greatest failure this year?

YTD as of 7/18 close, -1.67%. I’m not viewing the individual trade results as being composed of individual successes or failures. I view the process as one of methodology applied consistently, with individual trade results being somewhat randomly distributed over time, around an average result for that system. That holds true for relative value traders, GARP traders, cigar-butt traders, special situation traders, and other types of system traders. Sticking to a chosen system is the “success.” Currently I trade one of the four systems I track; in time, with a larger account, I’ll probably trade two simultaneously.

Are stocks cheap, expensive, or fairly valued?

How you look at “stocks” depends on how you aggregate the index, how you weight the components, etc. If the question is, “how is the S&P 500 valued?”, I dunno. I haven’t done the math on it, and don’t really care. Certainly some individual stocks are fairly valued, some are cheap, and some are dear, by methods that I would consider using.

Where are oil prices headed?

The sarcastic answer is “they will fluctuate.” I think we saw a blow-off top in oil prices just now. Long-term, I think the cycle of gasoline prices is topped as well, and GM’s boneheaded too little, too late moves probably marked the top as well as any capitulation ever could.

For the rest of the questions and answers, keep an eye on Gannon On Investing.

[EDIT: The post is up now at Geoff’s site: Blogger RoundTable July 2008.]

I certainly missed on calling the lows – by about 3 to 5 percent. In a short-timer’s dictionary, that’s disastrous. If you’re a short-timer, you probably should stop reading the Timing model updates, and focus on Aggressive or Rotational for ideas.

In the time frame that I use to look at timing the U.S. stock market, it’s too early to tell how good or bad those statements were, and the worst that can be said is that they missed the bottom. How badly they missed depends on the next several MONTHS, possibly YEARS, of price action. If the market recovers strongly over the next year-plus, it would have been a small miss and overall a nice call to deploy capital over the last few months; if the market goes down further, then it will look as bad a call in the long term as it does now in the short term. That’s the way the cookie crumbles.

I also don’t tend to focus on individual “calls” or picks when examining a system outcome, because the performance of a system over multiple years is determined by many different decisions, of which some will be good, some will be bad, some will be very good, and some will be very bad. The systems are backtested over more than a decade for a reason. This is why my systems are generally updated only once a month, with wrap-ups of all four systems every six months or so.

If this is too slow or boring for you, there are plenty of other market writers available to read. I’ve built and tested systems that move more quickly, but I have neither the time nor inclination to trade or track them.

In regards to the Timing model portfolio, it will continue to follow its mechanical signals. You can read the most recent update at The Rempel Report.

If you’d like to become of member of The Rempel Report, you can register here. At The Rempel Report, I track model portfolios for four different mechanical trading systems, as well as my personal portfolio, and disclose all results (good and bad) at regular intervals. Members receive email notification of new posts and can contribute to the site through comments. Registration is still free!

I offer no explanation, although I’m sure if I watched Bloomers or CNBC tonight, I’d hear plenty of explanations. Feel free to provide the most outrageously stupid one that you hear or read in the comments.

Index action isn’t going to influence what I do, anyways.

Not everything is getting hammered. Some things are working (even if they’re not the things you and I are in). Some things are ALWAYS working.

How you react to the market is more important than how the market acts.