Investment Sense Newsletter
At Investment Sense we are committed to keeping your money safe through strategy development, market timing, covered call writing and precious metals investing.
Tsunamis and the Stock Market: A hidden connection?
With the recent destruction in Japan from the massive 8.8 magnitude earthquake and subsequent tsunami, many are wondering what the effects on the stock market will be. There can be no doubt about the destructive power of this underwater quake: Waves reaching 13 feet tall crashed into the coast ripping apart buildings and washing away cars in a spectacle that made some Hollywood disaster films look tame...Tsunami Stock Alert
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Don't let it happen again! We will show you time-proven techniques to make money in any market whether rising, falling or just standing still. We use a proprietary market timing system to keep tabs on the market and provide a solid strategy to earn money.
Jeff Webster's Investment Sense is unique in that the name rings
true...you get a good dose of "investment sense" in every issue.
In-depth testing on important and practical topics, yet still
easy-to-read, I find the service to be of great help.
--Jason Goepfert,
President
www.sentimenTrader.com
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Jeff Webster's work is always thoughtful and thorough.
--Robert Prechter, Elliott Wave International
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I've read lots of different newsletters over the past 20 years and I really do like your presentation and your analysis. Keep up the good work. . .
--Harland Hendrickson, PhD
Edmonton, AB Canada |
Pitfalls of strategy development
There is something intoxicating about the idea of automated strategies. What could be better than to program a black box to sit in a corner of your guest room churning out profits day after day, month after month. Those new to the game can easily get carried away with dreams of riches as they develop and backtest strategies. Most programs allow the developer to automatically optimize variables and it's a simple matter to develop an optimized, backtested strategy with an annualized return of 185%... At this rate, assuming monthly compounding, an investor could turn $10,000 into $1.74 million in just three years! Not bad considering the entire system could be sitting in an empty corner in the spare bedroom quietly churning profits. No human intervention required.
Of course there is a problem.
In the majority of cases it never works out this way...(read more)
The Fund Scandal
"I'm cold," Snowden moaned. "I'm cold"
So begins one of the most memorable scenes in Joseph Heller's novel, Catch 22.
After
dodging heavy flak on a bombing mission, Yossarian has been instructed to go the rear of the
plane to help the wounded gunner. While he busies himself dressing the wound on Snowden's
thigh, the soldier keeps uttering this strange refrain.
I'm cold. I'm cold."
"There, there." Yossarian replies, not knowing what else to say.
Time after time, they exchange these words, Yossarian above all trying to keep himself
composed as he endures Snowden's plaintive gaze.
Finally, after watching him for a while, Snowden points his chin in the direction of the
real problem...(read more)
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TIMER DIGEST Rankings
TIMER DIGEST
is an established,independent newsletter which ranks market timers for their performance.
Investment Sense was:
Top Ten, last six months, October 30, 2006
Top Ten, last three months, November 20, 2006
#2, last year, November 20, 2006
#3, last year, December 11, 2006
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Merchants of Misery
Once pawn shops and check cashing centers were individually owned and considered a "second class" kind of business, but increasingly they have been moving toward larger operations and a cleaner business image. There has even been a growing number of partnerships with "normal" or First Tier banks.
Check cashing operations are well equipped to handle a large amount of total transaction volume, but are generally insufficiently capitalized to extend large numbers of uncollateralized consumer loans. On the other hand, the more established first tier banks tend to eschew opening branches in poorer, ethnic communities, which they consider to be higher risk. The check cashing operation ACE has developed a partnership with Goleta National Bank which allows them to provide small consumer loans of between $100 and $500. This gives Goleta some access to the lucrative distress loan market, while allowing them to sidestep actual development in the less affluent communities...(read more)
Origins of Wall Street
Unneeded and ignored, the defensive wall erected to thwart the English fell into disrepair and was torn down in 1698. Nonetheless, the space behind the wall -- originally reserved for the passage of troops -- became known as Wall Street, and soon became an important commercial center. By the late 1700s New York was rapidly growing economic force, rivaling Philadelphia and Boston, and Wall Street was the hub of the commercial transactions. Though Wall Street brokers originally dealt mostly with tangible goods (and would be considered wholesalers in modern parlance) their business increasingly turned from molasses, beaver pelts and tobacco to securities such as government bonds and shares of joint stock companies... (read more)
Greenspan admits the importance of sentiment!
One of the key factors behind our success is investor sentiment. We have over a dozen indicators which measure it. We have long maintained that understanding and measuring sentiment is one of the most important elements in successful market timing. And recently ex-Fed Chairman Greenspan has come forward and said the same thing.
Here is a quote from Greenspan from a recent interview with talk-show host Jon Stewart:
I've been dealing with these big mathematical models of forecasting the economy, and I'm looking at what's going on in the last few weeks. ... If I could figure out a way to determine whether or not people are more fearful or changing to more euphoric. I don't need any of this other stuff. I could forecast the economy better than any way I know. - Alan Greenspan
Well, Alan, you're in luck. We have exactly what you're looking for and we routinely beat the market with them!
Automobiles and the Stock Market
Heart in your throat you realize you haven't scrubbed enough speed from the straight-away. You imagine these might be your last moments as the centrifugal forces tug at the car. Will you make it? A blip of the throttle, a quick downshift and you glance toward the thickly lined trees beyond the edge of the road. You wonder if you will join them. But if youʼre going to go, it might as well be in a Ford GT...
...Like the automobile itself, trying to find the true originator of the assembly line is difficult. Any number of manufacturers who produced complex products used a division of labor to increase efficiency. And having an orderly flow of the product through the various departments on the way to completion wasn't exactly a new idea. Thus to say Henry Ford "invented" the assembly line - as is often done - isn't really accurate.(read more)
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