Seasonal Strategy taking advantage of monthly transfers

[grizzly386]

I know some of you follow the seasonal strategy and I wanted to pass along the seasonal strategy that I came across and have tried the past year. It has worked out well for me and when I checked my rate of return around March 5, 2013 it showed a 12 month return of 13.63%. It follows closely to the other seasonal strategies but takes advantage of utilizing up to 2 trades per month. The only time I did not follow it was this month, as of March 7, when I was suppose to interfund transfer to S. I instead put it into the G fund due to what I believe to be an upcoming market correction. I plan on riding it out in G until May 9 when it will go into the F Fund.
I just wanted to pass along what I have been using and got a decent rate of return. When I compare it to one of the other seasonal strategies it showed a gain of 1.78% for 2012 and with the below strategy I had a 13.08% gain. I am not an advisor, just passing along what I have tried and how it worked out for me.
January 3 - F Fund---------January 23 - S Fund
February 12 - F Fund
March 7 - S Fund
April 26 - G Fund
May 9 - F Fund-------------May 24 - S Fund
June 1 - G Fund------------June 10 - I Fund
July 3 - C Fund-------------July 25 - F Fund
August 19 - S Fund
September 18 - G Fund
October 26 - I Fund
November 8 - F Fund-------November 20 - S Fund
December 3 - C Fund-------December 23 - I Fund
I did not confirm this because I am not a guru with charts, and the TSP Seasonal Calculator doesnt allow you to do this (maybe TSPKing can help me out ) but it indicated the following yearly rates of returns when utilizing it - 2011 - 45%, 2010 - 49%, 2009 - 85%, 2008 - 55%, 2007 - 30%, 2006 - 27%, 2005 - 13%. So you can see why I wanted to give it a try.
Anyways just sharing and good luck!!

[crondanet5]

So the program does not "sell in May and go away"?

[grizzly386]

Sorry don't get what you mean.

[crondanet5]

There's an old Wall Street saying that investors should sell in May and go away. I believe your program goes into the S Fund in May. I lost $10,000 in my real TSP doing that.

[grizzly386]

OUCH!!! I really wish I was savy enough to prove the yearly historical rates of returns but I figured it was worth giving it a try. It took me a while but when the last big market drop I lost about $50,000. My risk tolerance was very high, which I have now become a little more conservative, but I have finally gotten over my previous balance high about 6 or 7 months ago. The way I look at it is that I will be happy with anything above 10% yearly return.

[aarvizo]

Is there a program you can analyze "maximum possible gains" historically, annually, and monthly taking into account our IFT restrictions? A program that could tell you what day and what funds the IFTs would be for in order to have obtained the max possible return.

And maybe creating a seasonal method that follows it.

[crondanet5]

grizz one quick way you can review the May Effect is to click on the S Fund chart below and select the 2 year graph and see what happened to the S Fund in May. This may be a way of tweaking your seasonal program by missing the May drop. Also remember that the F Fund, IMHO, is past its high point and that should lessen the F Fund returns this year. IMHO.

[grizzly386]

Thanks crondanet5 and I see what you mean. I pulled up the share prices from May 24, 2012 to June 1, 2012 (time you would move to S) and that approximate one week of investment in the S would have shown a loss of .88 a share. Whats interesting is that the previous three years it showed a gain during that same time period (2011 a gain of .25 a share, 2010 a gain of .07 a share, and 2009 a gain of .70 a share).
Maybe we can get one of the technical gurus to create a system that aarvizo describes. Maybe it could be done to the TSP Center seasonal calculator that can would allow contributions to the day instead of the whole month.
Thanks again.

[grizzly386]

Time will tell on a possible market correction but on March 7 the price for S was 26.88 and it closed yesterday at 27.13. Granted a long time until April 26 when it would normally move to G, so we will see if my guess is right and I look like a very wise man or this crazy market continues to push forward, seasonal proves to be right, and I lose some gains.

[crondanet5]

Fast Money Hedge Fund managers still bullish. Working for me.

[Woodbowski]

Look at your seasonal model with numbers I gathered from tsp.gov. Have to admit, your 85% return for 2009 peaked my interest. However the numbers just dont add up. At best, rounding up, you got 30%. Still a great return for the year, but far from 85%.

[crondanet5]

Using the TSP Charts & Returns - Date Range, S Fund, I found the following information:
1st Traading Last Trading
Day in May Day in May

2008 $19.13 $19.78

2009 $12.56 $13.06

2010 $19.30 $17.54

2011 $23.45 $23.31

2012 $23.37 $21.71

Do the math.

[grizzly386]

You are only in the S fund in May from May 24 to June 1. Sorry I probably should have clarified more. April 26 your in the G and stay there until May 9. Then you go to F and stay there until May 24 when you go to S. The date indicated before the fund is the date you move to that fund. You wouldn't go back into S until August 19.
I know the yearly historical seem very high and I would still like to put it into some data system to see if it actually does what was reported. Like I said I figured I would give it a try for a year and it did get me 13% plus.

[sludg]

Here is what I got using his dates or as close as possible depending on weekends and such for 2009.

January 2 - I Fund... 2.0568
January 3 - 22 Fund... 0.0343
January 23 - Feb 11 S Fund... 1.6374
February 12 - Mar 6 F Fund... -0.8683
March 7 - Apr 25 S Fund... 35.5761
April 26 - May 8 G Fund... 0.0825
May 9 - May 23 F Fund... -0.0369
May 24 - May 30 S Fund... 0.6554
June 1 - Jun 9 G Fund... 0.0714
June 10 - Jul 2 I Fund... -3.6690
July 3 - Jul 24 C Fund... 9.0750
July 25 - Aug 18 F Fund... 1.1959
August 19 - Sep 17 S Fund... 9.6846
September 18 - Oct 25 G Fund... 0.2945
October 26 - Nov 7 I Fund... -0.6152
November 8 - Nov 19 F Fund... 0.7073
November 20 - Dec 2 S Fund... 1.6991
December 3 - Dec 22 C Fund... 1.7182
December 23 - Dec 31 I Fund... 0.8509
Total - 60.1500
I had to add in the I fund at the beginning as the allocation was still I fund from the previous year and made a good gain on that 1 day.

Now what I did when calculating this was sell the previous fund the day prior to your given dates to move to the new funds, causing the dates to be as listed above. I'm not sure if this is what you meant but that is what it looked like to me. Either way 60.15% return is a beautiful number. I'll watch this throughout this year to see how it plays out for our current market.

Thanks for the new info to play with grizzly

[crondanet5]

You need to make it yield a better return. You will never recover that year and you are one closer to age 70.5 when you must begin withdrawing it. Make every year until then count.