MTS Webinars - Best 6 Months with Jeff Hirsch, Stock Traders Almanac

Best 6 monthsfor Stocks

Are you positioned for a change?

Jeffrey HirschEditor-in-Chief

www.stocktradersalmanac.com

DISCLAIMER:FOR INFORMATION PURPOSES ONLY

This presentation has been prepared solely for informational purposes, and is not an offer to buy, nor sell or a solicitation of an offer to buy or sell any security, product, service or investment. The opinions expressed herein do not constitute investment advice and independent advice should be sought where appropriate. All information and opinions expressed herein are current as of publication and are subject to change without notice.

Investing involves substantial risk. Neither Mr. Hirsch, nor any of his respective affiliates, employees and/or associates makes any guarantee or other promise as to any results that may be obtained from using this information. The advice and strategies contained herein may not be suitable for every situation. While past performance may be analyzed in this presentation, past performance should not be considered indicative of future performance. No one should make any investment decision based on this information without first consulting his or her own personal financial advisor and conducting his or her own research and due diligence, including carefully reviewing the prospectus and other public filings of the issuer. Neither Mr. Hirsch, nor any of his respective affiliates, employees and/or associates makes any representations or warranties with respect to the accuracy or completeness of the contents of the information herein and specifically disclaim all warranties, including without limitation warranties of fitness for a particular purpose. Neither Mr. Hirsch, nor any of his respective affiliates, employees and/or associates shall be liable for damages arising herefrom. No warranty is or may be construed to be created or extended by informational, sales or promotional materials.

Copyright © 2000-2014 by Jeffrey A. Hirsch and John Wiley & Sons, Inc. or related companies. All rights reserved. www.stocktradersalmanac.com

3

http://www.wiley.com/


http://www.wiley.com/go/copyright


4

Almanac Investing Philosophy

“Those who study market history are bound to profit from it!”





5

47-Years of Research





6

Digital Service




4 Keys Market Cycles

• Recurring Historical Patterns Undeniable

• Not Exact - Basic Framework Of Moves

• Must Use In Conjunction With Other Analysis

• Reduces Risk & Increases Profits


7





8

Major Investment Cycles

• War & Peace and the Markets• Secular Bull & Bear Markets• 4-Year Presidential Election/Stock Market Cycle• Seasonal Cycles

– Best Six Months November-April– Sectors & Commodities

• Quarterly, Monthly, Weekly, Daily, Intraday• January Barometer




In Play Now• 4-Year Presidential Election Stock Market Cycle• 50% Move off Midterm Bottom• Best 6 Months (AKA Sell in May and Go Away) • Seasonal MACD SELL Signal Triggered April 7, 2013• Down January Barometer December Low Indicator• Utilities, Bonds, Worst Six Months Defense, S&Ps, Cyclical &

Material Shorts


9




Copyright © 2000-2014 by Jeffrey A. Hirsch and John Wiley & Sons, Inc. or related companies. All rights reserved. www.stocktradersalmanac.com 10

January Barometer• Devised By Yale Hirsch in 1972• As S&P Goes in January, So Goes Year• Only 7 Major Errors: 88.9%, 8 Flat: 76.2%• 10 out of 15 Midterm Years, 14/15 Pre-Election• Reason Exists Is 20th “Lame Duck” Amendment• 4 Odd Years Wrong: 9/11, Iraq 2003, 2005 Flat, 2009• January 2008 was a heck of a Signal• 2009 Down Jan Signaled More Drop• Every Down Jan Since 1950: New or Cont. Bear,

10% Correction or Flat Year, Including 2010




Down Jan & Dec Low


11




Midterm Election Year History & Tendencies

Midterm Election Year History & Tendencies


Midterm Bottoms• After Inaugural Ball, Pay the Piper• Unmet Promises Often Crises• 2009 Paid Right Away• 9 of 14 Bears Since 1961 Ended in

Midterm Bottom• Bottom Pickers Paradise• No Bottom 1986 & 2006• 2009 Post Election Bottom• 2010 April-July Decline:

Dow -13.6%, S&P 500 -16.0%,NASDAQ -17.3%

Record Since 19611962 Kennedy (D) Bottoms in June and October.1966 Johnson (D) Bottom in October.1970 Nixon (R) Bottom in May.1974 Nixon, Ford (R) December Dow bottom,

S&P bottom in October.1978 Carter (D) March bottom, despite

October massacre later.1982 Reagan (R) Bottom in August.1986 Reagan (R) No bottom in 1985 or 1986.1990 Bush (R) Bottom October 11

(Kuwaiti Invasion).1994 Clinton (D) Bottom April 4 after 10% drop.1998 Clinton (D) October 8 bottom (Asian currency

crisis, hedge fund debacle)2002 Bush, GW (R) October 9 bottom (Corp malfeasance,

terrorism, Iraq)2006 Bush, GW (R) No Bottom in 2006

(Iraq success, credit bubble)





4-Year Cycle Sweet Spot• 2010-11 Delivers• DJIA 14.2%• S&P 16.2%• NAS 17.4%





50% Gain Off Midterm Low • Median = 50.6%• High = 89.6%• Low = 14.5%• 6 Jan Midterm Lows• 4 Oct Midterm Lows• Plus Oct Lows in 1962, 1974,

1978, 1998• 9 Dec Pre-Elect Highs• 6 Highs Last Day• From July 2010 Low

to April 2011 +32.3%





No DJIA 3rd Year Loss• Since War-Torn 1939

Still No Loss For DJIA• No Midterm Bottom 1986 & 2006

- Usually Bottom Pickers Paradise• 2009 Post-Election Bottom• Election Year Weaker• Pre-Election Stronger• Financial Crisis Impact• 7.3% 2012





1-Year Midterm Pattern Since 1950




End of the Best Six Months StrategyEnd of the Best Six Months Strategy


19

63-Year Seasonal Pattern




20

DJIA 1-Year Pattern


Best Six Months


Best Six Months + TimingAverage % Changein DJIA Since 1950

– 1.2%

9.3%

-2%

0%

2%

4%

6%

8%

10%

Best 6 Months Worst 6 Months

$10K Invested in DJIASince 1950

– $6,714

$1,878,516

– $100,000

$100,000

$300,000

$500,000

$700,000

$900,000

$1,100,000

$1,300,000

$1,500,000

$1,700,000

$1,900,000

Best 6 Months Worst 6 Months

April 1 Sell - Oct 15 Buy - April 7 Sell


23

Buy Signal & Recent Record


24

Sell in May but Don’t Go AwaySell in May but Don’t Go Away

Not Our Strategy

• Best Six Months Switching StrategyIs NOT Sell In May

• We Do Not Sell Willy-Nilly• Prevent Defense• Let Winners Ride – Stay Long Many Stocks


26

Prevent Defense

• Tighten Stops• Limit New Equity Longs• Bonds: iShares Core Total US Bond Market (AGG)• Ranger Equity Bear (HDGE)• Summer Shorts: Cyclical and Materials• Cash, Puts, etc.


27

Q2 OutlookQ2 Outlook

Summer ShortsSummer Shorts

Bunge (BG)

Intrepid Potash (IPI)

Rentech Nitrogen (RNF)

Kraton Performance Polymers (KRA)

Sector and Commodity

seasonal set ups

Sector and Commodity

seasonal set ups

Q2 Stock Index Trades


35

Ticker Sector Index Type 15-Year 10-Year 5-Year

XNG Natural Gas Long February E June B 16.8 13.0 12.6

RXP Healthcare Prod Long March M June M 6.5 8.3 6.7

RXH Healthcare Prov Long March M June M 14.3 12.6 18.1

MSH High-Tech Long March M July B 9.3 10.6 8.0

UTY Utilities Long March M October B 10.7 10.8 7.9

XCI Computer Tech Long April M July M 9.1 6.7 4.3

IIX Internet Long April M July B 8.5 7.8 1.4

CYC Cyclical Short May M October E –8.7 –2.7 –8.2

XAU Gold & Silver Short May M June E –7.6 –4.2 –5.5

S5MATR* Materials Short May M October M –9.6 –3.0 –7.7

BKX Banking Short June B July B –5.6 –6.1 –9.4

XNG Natural Gas Short June M July E -8.1 -4.2 -5.5

† Average % Return based on full seasonality completion through May 17, 2013

* S5MATR Available @ bloomberg.com

SECTOR INDEX SEASONALITY TABLESeasonality Average % Return †

Start Finish

B = Beginning Third, M = Middle Third, and E = Last Third of the Month

www.StockTradersAlmanac.com

Q2 Seasonal Sector Trades

www.wiley.com/go/seasonalsectortrades


36

Trading Hold Success # # Total Best Worst

Commodity Contract Years Day Days Rate Gains Losses Gain Gain Loss

April30-Year Bond Bottoms (Long) U 1978-2013 18 81 69.4% 25 11 $88,766 $20,250 $17,031S&P 500 Bottoms (Long) U 1982-2013 18 28 65.6 21 11 13,525 23,075 33,175

MayCattle Peaks (Short) V 1976-2013 2 30 65.8 25 13 17,260 2,808 2,470Copper Peaks (Short) N 1973-2013 8 13 63.4 26 15 22,288 7,513 6,600Silver Peaks (Short) N 1973-2013 10 29 68.3 28 13 83,925 19,750 13,000Coffee Peaks (Short) U 1974-2013 16 54 72.5 29 11 151,523 37,556 17,119British Pound Peaks (Short) U 1975-2013 20 8 64.1 25 14 13,663 7,125 1,938

June30-Year Bond Bottoms (Long) U 1978-2013 2 10 63.9 23 12 $20,359 $5,156 $2,828Cocoa Bottoms (Long) U 1973-2013 2 24 63.4 26 15 17,610 2,980 4,130Soybeans Peak (Short) U 1970-2013 5 36 63.6 28 16 16,275 12,763 16,375Wheat Bottoms (Long) Z 1970-2013 6 105 54.5 24 20 20,439 12,025 15,300Sugar Bottoms (Long) V 1975-2013 11 32 61.5 24 15 22,411 5,398 5,869Cattle Bottoms (Long) J 1970-2012 14 160 67.4 29 14 42,320 15,270 11,600Corn Peaks (Short) U 1970-2013 18 25 63.6 28 16 21,781 8,975 9,050British Pound Bottoms (Long) U 1975-2013 20 16 71.8 28 11 33,131 8,406 7,188

Utilities Spring Thaw• Stock Trader’s Almanac 2014, page 92, Sector Seasonality &

StockTradersAlmanac.com Subscriber Alert• Great Worst Six Months Sector - 10% Gain March-October• Combo Winter Heating/Lighting & Summer AC• May 2013 Rates Jumped, Utilities Sank• 2014 Bright Spot Rates Falling UTY Dividends Attractive• Improving U.S. Growth Should Drive Energy Demand• Seasonal Factors, Positive Current Trend & Fundamentals


37

UTY & XLU


38

SPDR Utilities (XLU)Buy limit: 38.21 Stop loss: 34.55


39

What was the first year of the Stock Trader’s Almanac?What was the first year of the Stock Trader’s Almanac?

What year of the 4-year Presidential term has the most bear market bottoms?What year of the 4-year Presidential term has the most bear market bottoms?

What and when was the highest close on the near-term contract of silver?What and when was the highest close on the near-term contract of silver?

What and when was the highest close on the near-term contract of corn?What and when was the highest close on the near-term contract of corn?

In what year did the Dow Jones Industrials post its largest January percent loss?In what year did the Dow Jones Industrials post its largest January percent loss?

What year since 1950 did S&P 500 post the BEST Worst Six Months?What year since 1950 did S&P 500 post the BEST Worst Six Months?

What year since 1950 did S&P 500 post WORST Worst Six Months?What year since 1950 did S&P 500 post WORST Worst Six Months?

What is the best stock sector during the Worst Six Months?What is the best stock sector during the Worst Six Months?


49

Thank You!

DISCLAIMER: FOR INFORMATION PURPOSES ONLY

This presentation has been prepared solely for informational purposes, and is not an offer to buy, nor sell or a solicitation of an offer to buy or sell any security, product, service or investment. The opinions expressed herein do not constitute investment advice and independent advice should be sought

where appropriate. All information and opinions expressed herein are current as of publication and are subject to change without notice.

Investing involves substantial risk. Neither Mr. Hirsch, nor any of his respective affiliates, employees and/or associates makes any guarantee or other promise as to any results that may be obtained from using this information. The advice and strategies contained herein may not be suitable for every

situation. While past performance may be analyzed in this presentation, past performance should not be considered indicative of future performance. No one should make any investment decision based on this information without first consulting his or her own personal financial advisor and conducting his or

her own research and due diligence, including carefully reviewing the prospectus and other public filings of the issuer. Neither Mr. Hirsch, nor any of his respective affiliates, employees and/or associates makes any representations or warranties with respect to the accuracy or completeness of the contents of the information herein and specifically disclaim all warranties, including without limitation warranties of fitness for a particular purpose. Neither Mr. Hirsch,

nor any of his respective affiliates, employees and/or associates shall be liable for damages arising herefrom. No warranty is or may be construed to be created or extended by informational, sales or promotional materials.

Jeffrey A. Hirsch is, President of the Hirsch Organization, Editor-in-Chief of the Stock Trader’s Almanac, co-author of the NEW Seasonal Sector Trades quarterly, editor of the Almanac Investor Newsletter, and author of Super Boom: Why the Dow Will Hit 38,820 and How You Can Profit From It and The Little Book of Stock Market Cycles.The Data-Rich & Data-Driven 47-Year Market Cycle Analysis of Stock Trader's Almanac is the only investment tool of its kind that helps traders and investors forecast market trends with accuracy and confidence. To learn more about Almanac suite of products, please visit www.stocktradersalmanac.com.

Attention Traders!MrTopStep BootCamp in just 6 days!!!

Trading is picking up in all the markets. There is no time like NOW to join the MrTopStep BootCamp coming up in just 6 days.

This is a special offer that allows you to be a part of the MrTopStep Trading Room for a full week starting April 18 until April 24.

Your chance to meet the traders and become part of the MrTopStep Trading “Collective” http://chat.mrtopstep.com

MTS Webinars - Best 6 Months with Jeff Hirsch, Stock Traders Almanac

Education

Transcript of MTS Webinars - Best 6 Months with Jeff Hirsch, Stock Traders Almanac