Sell Signal Generated

By on May 7, 2009

The Tactical Timing System generated a sell signal today.

To comply with the system the following positions will be sold at the open tomorrow:

Aegon (AEG)

Blyth (BTH)

Brunswick (BC)

International Paper (IP)

New York Times (NYT)

Wal-Mart (WMT), 50% of position

Wells Fargo (WFC)

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Target Allocation: 60% equities; 40% fixed income

Commentary: The rise from the depths of March 9th has been historic. However, this appears to be a rally in an ongoing historic bear market. Unfortunately, 5 of the 7 equities being sold were purchased at much higher prices. Most were bought partly due to their generous dividends which have since been slashed. This makes them especially vulnerable to a renewed sell-off. At some point in the near future, the proceeds will be invested in iShares Barclays TIPS Bond (TIP) fund. The quest to print massive amounts of money by the Fed makes inflation a significant risk in the future. Inflation protected bonds are one way to protect the account from the enormous effort being undertaken to re-inflate the economy.

Disclaimer: It is challenging to outperform a buy and hold strategy. Many investors have found themselves well-served over long time horizons by investing regularly in a diversified portfolio of stocks or low cost, broadly diversified indexed stock funds. Information presented is based on analysis of past data and assessments by the Tactical Timing System model. Future performance may not reflect past performance. Profitable trades are not guaranteed. No system or methodology ensures stock market profits. Although accuracy is strived for, no guarantee is made regarding the accuracy of data presented.

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