Frequently Asked Questions

What is your track record in the stock market?
I have not had a losing calendar year since I began keeping track 16 years ago. In fact, I have out performed the market averages by getting out of the market at the beginning of the large market declines. During this time I was developing and refining the model we use for The TSP Report.

Have you back-tested your model?
No. Because the markets are continually changing, back-testing is not an accurate indicator of future performance. There are hundreds of systems that appeared to deliver tremendous performance during back-testing, only to under-perform the market when utilized in real-life. The only way performance can be measured is by examining the rates of return that have actually been realized by using the model/system.

What factors are used by your model?
While I'm not going to give away the proprietary keys to our model, I will tell you that our model uses a combination of fundamental, technical (trend-following), and historical factors.  The fundamental factors include macroeconomic drivers such as interest rates, money supply, the leading economic indicator, plus other government reported statistics.  The technical factors include moving averages, momentum, and investor sentiment. The historical factors are items such as average duration of bull/bear markets, average gain/loss, seasonal performance, etc.  We use the fundamental factors to determine if we should be invested in the bond/US stock/international stock markets.  We then use the technical and historical factors to time our buy/sell signals. Our model is designed to take out the emotion or "gut instinct" factor of making investment decisions.

How often should I check the web site?
If you are like most people, checking the web site once a month or so will be adequate. Those of you with a higher level of interest or with a more aggressive investment outlook may want to check it more frequently to make the most of the posted buy and sell signals. (I use the terminology "buy" to mean an interfund transfer of money out of the G-fund into one of the other funds, conversely a "sell" means as interfund transfer from one of the other funds into the G-fund).  The TSP Report newsletter is posted in the members' area of this web site and e-mailed to subscribers (members) once a month. Specific buy and sell signals will be posted on the web site as they occur as well as e-mailed as Special Bulletins to subscribers. These Special Bulletins may occur in between the monthly issues of The TSP Report.

Why don't I receive the e-mail distribution of The TSP Report?
Because the e-mail we send out has all the addresses in Blind Copy, your e-mail service may think it is spam and will move it to your bulk/spam e-mail folder. You will need to mark our e-mail as "not spam".

How many buy or sell signals per year do you anticipate?
It all depends on market conditions, but historically I have issued four buy or sell (TSP interfund transfer) signals per year. Our interfund transfers are listed on the PERFORMANCE page of this website.

Do you follow The TSP Report’s buy and sell signals in your personal accounts?
Yes, I follow the Growth model portfolio in my tax deferred accounts. I place my transfer request on the day after the buy or sell signal is posted on the web site and e-mailed to subscribers.

In what type of market conditions does the approach used by The TSP Report perform best in?
The approach used by The TSP Report will perform best in trending market conditions. That is, stock markets that are steadily going up or steadily going down. The TSP Report approach will likely under perform the buy and hold method in markets that only move sideways or are extremely volatile. Like most other systems, the TSP Report approach could be vulnerable to drastic one to two-day type declines such as occurred in October 1987 and February 2007. Stock market investors should expect to experience these types of declines on occasion.

Why don’t you like the “buy and hold” approach?
I don’t like the buy and hold approach because there have been very long periods of time when the buy and hold approach either made no money or lost money. For example between the period of February 9, 1966 to August 12, 1982, a period of 16 ½ years, the Dow Jones Industrial Average went from 995 points to 777 points. After the stock market peak in 1929, it took until 1955 to get back to even. I don’t want to wait that long just to break even.

Why don't your portfolios incorporate the new Life Cycle funds?
We don't invest in the Life Cycle funds because they are simply combinations of the other five funds and, therefore offer us no advantage over the five basic TSP funds.