Don’t ask me how I stumbled upon the ETF Trends website but I did. But then I happened to stumble upon Tom Lydon’s Global Trends Investments and I have to say that after reading the main page it was refreshing to see his strategy clearly spelled out right from the get-go without any having to dig through tons of prospectus material or other fine print.
It seems like almost every professional fund management site I have been to is not too clear on exactly how they plan to manage your money or what their specific strategy is. Perhaps they are but it takes a while to find out the real details. That has been my experience anyway, maybe you have a different one. But anyway I am going to call Tom Lydon ‘The ETF Guy’ because his site ETFTrends focuses on only one thing, ETFs.
Here is the quote from the main page of Global Trends:
At Global Trends Investments, we follow an investment discipline using the 200-day moving average and exchange traded funds. When the markets are above the trend line, we are invested, and when they are below, we are in cash. If there are no areas trending in the right direction, we exit equities completely and sit on the sidelines until the market trends turn. We also have an 8% stop-loss, so when holdings are 8% off their high, the position is sold. This exit strategy helps protect you from losing all of the gains made.
What a nice clear statement of strategy. I like that. I like it even more because there are technical criteria that make up the fund management strategy.