A.I.M. Users Bulletin Board

[SFSecurity]

Hi Gang, Talk about volatility! I was reviewing the AAII Journal ETF Guide and noticed QLD has a history of up 1965.5% as a bull market response and an 80.6% bear market drop according to their chart. Wow.

Taking SPY as a general indicator of the whole market, it hit end of day bottom on March 9th, 2009 at $68.11, down from October 9th, 2007 at $156.48. Currently SPY is at $242.71 or 355.45% up from market bottom.

QLD also end of day bottom on March 9th 2009 at $2.45, down from October, 31st, 2007 at $15.30875. Currently QLD is at $60.639999 as of yesterday. I'm not sure if that is accurate as there was a 2/1 split back on July 17th, 2017, but it might not have propagated yet. Anyway the price on the 14th was $61.49 so the range is close with it being up about 2475%. Double, triple WOW!

Given what the NBER says, taking the last three bull markets, the Peak to Peak was an average of 8.8 years and the Trough to Trough was 8.86 years. If we just take the last two the Peak to Peak was 8.7 years and the Trough to Trough was 9.125 years. Given these figures and the way the market is jumping around it seems that we are not far off the peak. They say the last Peak was December 2007 and the last Trough was June of 2009, about 19 months apart.

Okay, if we look at SPY as a single ETF that mimics the market as a whole, it hit bottom in March 2009. With that as a starting point and averaging the two figures above, you get 8.9925 years for Trough to Trough or the bottom would hit somewhere around February or March next year. My flip a coin guess it that it won't be then but some months later.

Taking the Peak to Peak, averaging the two above, you'd get 8.75 years, or October/November this year, give or take a bit. I've noticed that a number of "experts" (we all know about the CXO study about ~6600 forecasts by 68 experts, right?) are predicting October as the next peak. Given the "experts" in the study were right only 47% of the time, basically a coin toss, so it is not certain that it will happen but given the chaos around us, the coin might come up heads, but then again it is just a coin toss.

Given all this I'd check out QLD and have ample powder on hand and keep it very dry so when it comes time you won't misfire.

Just guessing, looking at the chart, I think it would out perform Buy & Hope even if B&H got in at market bottom.

Best,

Allen