How to Tactically Time the Market to Enhance Returns

Many say that it’s not possible to time the market.. Honestly, they just aren’t doing it right. It is very possible to make tactical decisions for your investments that can greatly amplify your chance of success in the markets. You just need to know what you should look for and how you can use it to your advantage.

That’s what I would like to share with you today.

Have a look at this chart of the S&P500 from 2003-2007. There is a clear indication of a change in trend from the crossovers between the two moving averages.

The 25 day moving average crosses above the 50 day moving average in the first half of 2003. The next time it crosses below the 50 day moving average is towards the end of 2007, just before the financial crisis of 2008.

Is this just a coincidence?

Well, there are many many more examples of the same change of trend.

Check these out:

2000-2003

 

2012-2015

 

So where are we today? With the 25 day moving average still floating high above the 50 day moving average, it appears that we are still in an Up Trend.

2016-Present

 

So, how can we use this validation of an Up Trend to our advantage. Simple - focus your portfolio on the long side, don't be afraid to pursue Quality Growth strategies. One of our strategies that tend to do well in this environment is the GARP (Growth at Reasonable Price) with Momentum Strategy.