Friday, February 18, 2011


Although Chairman Bernancke is taking credit for the latest stock market rally, I'd like to posit that it was all my doing!

For almost 2 years I've been espousing the DITM - the optimal strategy for sideways to down markets, averaging an annualized 10%,which happens to be exactly the same return as the S&P 500 since 1926 (dividends included).

Meanwhile the market has rallied the most in several decades: the SPX is up 100% since March of '09 (Nasdaq up 124%); which is why I mention in my talks to use only a Portion of one's assets for DITM. This achieves the safety of diversity as well as the ability to invest elsewhere (like Spiders, Gold, etc.).

Today's trade was a call-away of my DIAs, which are a good entry point for new investors into DITM. With the DJIA at 12,363 (the DIA at 1/100th of it - 123), my March 103.75 Call was exercised early:

Annualizing over 4 months (multiplying the net % by 3), it very safely returned 8.27%. Not quite 10%, but lower down on the Safety pyramid. If/when the market sells off after its record run, I shall re-enter a position.

Next week I'll be giving another talk to the Golden Gate Univ. Learning Program and Finance Club, which is open FREE to the public. It's on the 5th floor of GGU, Wed., Feb.23 at 5:30.

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