Livesoft: Worst day?

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Livesoft: Worst day?

Postby rr2 » Tue Nov 16, 2010 4:23 pm

Livesoft --

Is today a worst day?
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Postby hsv_climber » Tue Nov 16, 2010 4:27 pm

Read the livesoft manual 8)

There is no such generic thing as "worst day". "Worst day" applies to a specific ETF. Are you asking about a specific ETF?

Personally, I don't see any of the ETFs on my "watch" list that would qualify.
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Postby livesoft » Tue Nov 16, 2010 4:31 pm

Close, but not yet.
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Postby dbonnett » Tue Nov 16, 2010 4:41 pm

lost my copy of manual....please supply link....
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Postby rr2 » Tue Nov 16, 2010 4:42 pm

hsv_climber wrote:Read the livesoft manual 8)

There is no such generic thing as "worst day". "Worst day" applies to a specific ETF. Are you asking about a specific ETF?


I was looking at VTI, VEU, VSS. My actual portfolio usually tracks a weighted sum/average of the three ETFs.

I wasn't planning on doing anything today. Just was curious.

PS: I am interested in the manual as well :)
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Postby Noobvestor » Tue Nov 16, 2010 4:43 pm

viewtopic.php?p=780576

viewtopic.php?p=510976

Not sure if/where there is a 'manual' per se :S
Last edited by Noobvestor on Tue Nov 16, 2010 4:48 pm, edited 2 times in total.
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Postby rr2 » Tue Nov 16, 2010 4:46 pm

noobvester wrote:http://www.bogleheads.org/forum/viewtopic.php?t=63183&mrr=1289939464


The link you provide just points back to this topic.
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Postby Noobvestor » Tue Nov 16, 2010 4:48 pm

Good catch, thanks :) Fixed it.

I figured 'what the heck' since that's where the cash was going anyway - put in the new funds I hadn't added into my equities yet from my money market (I transfer to the MM first, then distribute to the funds as per my AA). If it keeps going down, ces la vie. I guess I just kinda timed the marked :(
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Postby SP-diceman » Tue Nov 16, 2010 4:54 pm

Is it one of the 10 days????




Thanks
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Postby chaz » Tue Nov 16, 2010 4:55 pm

livesoft wrote:Close, but not yet.


Very close.
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Postby hsv_climber » Tue Nov 16, 2010 4:58 pm

On VTI, VEU, VSS not close at all.

Worst day would be at least over 3-3.5% on these funds and over 5% on VNQ.
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Postby rr2 » Tue Nov 16, 2010 5:03 pm

hsv_climber wrote:On VTI, VEU, VSS not close at all.


At one point shortly after 3PM, things were starting to trend down and approaching 3% on VEU and larger than 3% on VSS.
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Postby gkaplan » Tue Nov 16, 2010 5:50 pm

What happened today?
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Postby SP-diceman » Tue Nov 16, 2010 5:55 pm

gkaplan wrote:What happened today?


A near miss of a livesoft day.
(it was close) :)




Thanks
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Postby livesoft » Tue Nov 16, 2010 7:35 pm

For completeness, I prefer to reference these 2 threads for "worst day" stuff:
viewtopic.php?t=41939
viewtopic.php?t=60207

I link them here in case someone is wondering where all this comes from.
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Postby natureexplorer » Tue Nov 16, 2010 7:40 pm

Is there a definition of worst week, month, year, decade, century as well?
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Postby mas » Thu Nov 18, 2010 2:17 pm

Too bad. Today would have made a good "day after the worst" day.
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Postby Noobvestor » Thu Nov 18, 2010 2:55 pm

mas wrote:Too bad. Today would have made a good "day after the worst" day.


I got lucky and dumped in during the down days (stuff I was going to put in within a week or two regardless). Of course, if tomorrow turns around and keeps spiraling down ... :)
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Postby livesoft » Thu Nov 18, 2010 3:14 pm

mas wrote:Too bad. Today would have made a good "day after the worst" day.

Today is a nice "day after the almost a worst day" day. You can't win 'em all. But it shows that in the random walk, noticeable diversions can occur close together in time.
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Postby pmcgillicutty » Fri Nov 19, 2010 3:09 am

Have been reading and re-reading previous posts on worst days in an attempt to "time" my Roth IRA conversion. Sure was looking good (bad) a few days ago, but it just wasn't a worst day :wink:

Livesoft: Loved your most recent response.
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Stay-the-course

Postby Taylor Larimore » Fri Nov 19, 2010 9:13 am

Hi Diehards:

The 10 Worst Days for the Dow (1950 to March 2009)

10-19-87....-22.6%
10-26-87......-8.0%
10-15-08......-7.9%
12-01-08......-7.7%
10-09-08......-7.3%
10-27-97......-7.2%
09-17-01......-7.1%
09-29-08......-7.0%
10-13-89......-6.9%
01-08-88......-6.9%

(Source: Stock Trader's Almanac)

In January 1950 the Dow was 202. Today the Dow is 11,181 (not counting dividends).

Those who stayed-the-course were well rewarded.
"Simplicity is the master key to financial success." -- Jack Bogle
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Re: Stay-the-course

Postby hsv_climber » Fri Nov 19, 2010 9:23 am

Taylor Larimore wrote: Those who stayed-the-course were well rewarded.


But would not those who bought Dow (S&P) - tracking mutual funds on these worst days got rewarded even more?
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Postby livesoft » Fri Nov 19, 2010 9:26 am

Mr Larimore, did you rebalance on 10-19-87? Surely, one's asset allocation was out-of-whack by the end of that day. Stay-the-course means "buy and rebalance" nowadays, doesn't it?
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Re: Stay-the-course

Postby Ed 2 » Fri Nov 19, 2010 9:31 am

Taylor Larimore wrote:Hi Diehards:

The 10 Worst Days for the Dow (1950 to March 2009)

10-19-87....-22.6%
10-26-87......-8.0%
10-15-08......-7.9%
12-01-08......-7.7%
10-09-08......-7.3%
10-27-97......-7.2%
09-17-01......-7.1%
09-29-08......-7.0%
10-13-89......-6.9%
01-08-88......-6.9%

(Source: Stock Trader's Almanac)

In January 1950 the Dow was 202. Today the Dow is 11,181 (not counting dividends).

Those who stayed-the-course were well rewarded.


I've looked the chart of the DOW for the last century. All those deeps were nothing, even during the Great Depression compare to overall progress in the stock market.
http://www.dogsofthedow.com/dow1900log.htm
So, stay- the -course, keep you asset allocation according your risk tolerance.
Good day.
Last edited by Ed 2 on Fri Nov 19, 2010 9:45 am, edited 2 times in total.
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Postby Sidney » Fri Nov 19, 2010 9:32 am

livesoft wrote:Mr Larimore, did you rebalance on 10-19-87? Surely, one's asset allocation was out-of-whack by the end of that day. Stay-the-course means "buy and rebalance" nowadays, doesn't it?


I seem to recall that Taylor said he was on a ship with no access to a phone. or maybe I am confusing him with someone else.
I always wanted to be a procrastinator.
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Postby gkaplan » Fri Nov 19, 2010 9:39 am

My water pump went out on 10/19/1987.
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I was scared.

Postby Taylor Larimore » Fri Nov 19, 2010 9:40 am

livesoft wrote:Mr Larimore, did you rebalance on 10-19-87? Surely, one's asset allocation was out-of-whack by the end of that day. Stay-the-course means "buy and rebalance" nowadays, doesn't it?


Hi livesoft:

All I remember is that I was scared -- until I remembered stock market history (the Dow plunged -52.7% in 1931) and Mr. Bogle's sage advice:

"Stay-the-course."
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Re: Stay-the-course

Postby jpsfranks » Fri Nov 19, 2010 9:47 am

hsv_climber wrote:
Taylor Larimore wrote: Those who stayed-the-course were well rewarded.


But would not those who bought Dow (S&P) - tracking mutual funds on these worst days got rewarded even more?

Not necessarily. Being able to invest in stocks on "worst days" implies having assets with lower expected returns at other times. I have yet to see a concrete back-testable definition of a "worst" day including how to shift assets back subsequently. I think that a "worst" day is when livesoft is having a bout of indigestion.
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Re: Stay-the-course

Postby hsv_climber » Fri Nov 19, 2010 9:53 am

jpsfranks wrote:Not necessarily. Being able to invest in stocks on "worst days" implies having assets with lower expected returns at other times.


Are you 100% invested in stocks? Because if not then it implies that you have assets with lower expected returns @ other times.
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Re: I was scared.

Postby Ron » Fri Nov 19, 2010 9:53 am

Taylor Larimore wrote:
livesoft wrote:Mr Larimore, did you rebalance on 10-19-87? Surely, one's asset allocation was out-of-whack by the end of that day. Stay-the-course means "buy and rebalance" nowadays, doesn't it?


Hi livesoft:

All I remember is that I was scared -- until I remembered stock market history (the Dow plunged -52.7% in 1931) and Mr. Bogle's sage advice:

"Stay-the-course."

I/wife had been in the equity market for five years in 1987. Our AA at the time was 90/10 (90% equity - 10% bond-cash).

We did nothing on that date, nor many other downturns over the years until we were five years away from our planned retirement; reducing our equity holdings and stocking our respective "cash buckets".

While concerned at the time, I was fortunate to speak to a professor (I was attending night school at the time) who was the same age as me, today :roll: . His advice was simply that high/low tides happen every day, and sometimes (depending on spring/neap tides) greater variations happen. It's just a part of nature.

I'm glad we followed his sage advice.

- Ron
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Re: Stay-the-course

Postby jpsfranks » Fri Nov 19, 2010 10:31 am

hsv_climber wrote:
jpsfranks wrote:Not necessarily. Being able to invest in stocks on "worst days" implies having assets with lower expected returns at other times.


Are you 100% invested in stocks? Because if not then it implies that you have assets with lower expected returns @ other times.

I have an asset allocation I am comfortable with. To say that a "worst" day strategy is beneficial you have to show that a more conservative portfolio that occasionally shifts more aggressive on "worst" days performs better than the fixed aggressive portfolio.

There have been a couple of threads where we danced around concrete ways to apply a "worst" day methodology. So far I would categorize it as "mostly harmless".
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Postby natureexplorer » Fri Nov 19, 2010 10:53 am

The average closing price since 1950 for the S&P 500 on days it was down 3% is 729.

The average closing price since 1950 for the S&P 500 on all days is 388.
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Postby am » Fri Nov 19, 2010 11:56 pm

I rebalanced into Wellington in 1932 and have been rewarded handsomely. :wink:
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Postby Noobvestor » Sat Nov 20, 2010 1:20 am

am wrote:I rebalanced into Wellington in 1932 and have been rewarded handsomely. :wink:


Are you ... serious? You've owned Wellington since 1932??? Or am I just that gullible? :/
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Postby hsv_climber » Tue Nov 23, 2010 1:08 pm

We will probably hit "worst" day on all International Funds today.
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Postby livesoft » Tue Nov 23, 2010 1:34 pm

I've been doing some "studies". I am not going to call this a "worst day" strategy anymore because folks get totally confused. Instead, I am going to call this the "really bad day" strategy.

The last 3 really bad days for FSIIX (large cap foreign developed) were
2010-08-11: -4.04%
2010-06-04: -3.56%
2010-06-29: -3.28%
and for EFA the last 4 bad days occurred on
2010-08-11: -4.55%
2010-06-04: -4.28%
2010-06-29: -3.42%
2010-07-16: -3.20%


So we would need a drop of at least 3.3% in VEA or EFA for today to qualify as a "really bad day".
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Re: Livesoft: Worst day?

Postby YDNAL » Tue Nov 23, 2010 2:22 pm

livesoft wrote:I've been doing some "studies". I am not going to call this a "worst day" strategy anymore because folks get totally confused. Instead, I am going to call this the "really bad day" strategy.

The last 3 really bad days for FSIIX (large cap foreign developed) were
2010-08-11: -4.04%
2010-06-04: -3.56%
2010-06-29: -3.28%
and for EFA the last 4 bad days occurred on
2010-08-11: -4.55%
2010-06-04: -4.28%
2010-06-29: -3.42%
2010-07-16: -3.20%


So we would need a drop of at least 3.3% in VEA or EFA for today to qualify as a "really bad day".

What follows is BAD information. We had "badder days" of at least -3.3% in 2009. :)

VDMIX (Foreign Developed)
1/20/2009 -6.72%
3/2/2009 -5.28%
2/17/2009 -5.21%
2/10/2009 -4.51%
3/30/2009 -4.04%
3/5/2009 -3.67%
1/29/2009 -3.62%
1/14/2009 -3.55%
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Postby neverknow » Tue Nov 23, 2010 2:44 pm

..
Last edited by neverknow on Mon Jan 17, 2011 5:53 pm, edited 1 time in total.
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Postby 555 » Tue Nov 23, 2010 2:44 pm

How about calling it a "really bad day trading strategy"?
livesoft wrote:Instead, I am going to call this the "really bad day" strategy.
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Postby Opponent Process » Tue Nov 23, 2010 3:06 pm

maybe just an RBD for Korea today.
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Re: Livesoft: Worst day?

Postby YDNAL » Tue Nov 23, 2010 3:17 pm

neverknow wrote:There is no law of the universe that requires you to participate in this nonsense (if it doesn't suit you). And it doesn't suit me. Back in 1987 it was forever into the future that retirement was, and now -- not far enough. Laddered CD's (4 tier 2 year ladder is my choice) goes on adding compounded interest, boring year after boring year. (I do have some in the market, for diversification)

The "badder days" can be used to rebalance the token "in the market, for diversification" stuff. :)
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Postby GammaPoint » Tue Nov 23, 2010 3:45 pm

Can we get a "Livesoft Really Bad Day" app? I could put it on my Touch.
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Postby livesoft » Tue Nov 23, 2010 4:00 pm

GammaPoint wrote:Can we get a "Livesoft Really Bad Day" app? I could put it on my Touch.

I have written such an app, but it is too good to be true, so I am not distributing it until after I've made another ten million dollars.

Is a calander a cross between a calendar and a colander? I guess that's a calendar with holes in it where the reallly bad days would normally be?
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Postby hsv_climber » Tue Nov 23, 2010 4:07 pm

livesoft wrote:Is a calander a cross between a calendar and a colander? I guess that's a calendar with holes in it where the reallly bad days would normally be?


I've thought it is just means "calendar" in Irish.
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Postby Noobvestor » Tue Nov 23, 2010 4:09 pm

How about a Boglehead app along the lines of the 'Don't Panic' sticker on the front of the Hitchhiker's Guide to the Galaxy - the all app would do is highlight one of three words (maybe stacked like a stoplight?):

Buy
Hold
Rebalance
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Postby Noobvestor » Tue Nov 23, 2010 6:01 pm

Morgan wrote:
noobvester wrote:How about a Boglehead app along the lines of the 'Don't Panic' sticker on the front of the Hitchhiker's Guide to the Galaxy - the all app would do is highlight one of three words (maybe stacked like a stoplight?):

Buy
Hold
Rebalance


Yes! And a hypnotic track playing in the background repeating those words.

I LOL, but some people really do try to sell stuff in the vein of 'the Boglehead experience -- guaranteed to make you a millionaire or your money back'.

Keep the ideas flowing 8)


Here's the Beta :lol:

Image
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Postby JimB66 » Tue Nov 23, 2010 7:07 pm

noobvester wrote:
Here's the Beta :lol:


Well done!
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Re: Livesoft: Worst day?

Postby xram » Sun Jan 27, 2013 12:12 am

How do apply a RBD calculation to a mutual fund? Just run the numbers for the corresponding ETF?
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Re: Livesoft: Worst day?

Postby rr2 » Mon Jan 28, 2013 2:40 am

xram wrote:How do apply a RBD calculation to a mutual fund? Just run the numbers for the corresponding ETF?


For the Fund you are looking to buy see the corresponding ETF.

1. Has the ETF dropped in value today?
2. Is this drop greater than 2.5%?
3. Is this drop greater than the 4th largest drop in the past 151 trading days (including today)?

-- If ALL of the above are true, then buy the fund.

It is best to check as close to end of day. Have your mutual fund buy order ready to go.

Livesoft -- is this correct?
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Re: Livesoft: Worst day?

Postby livesoft » Mon Jan 28, 2013 8:14 am

Yep. Is that what the fuss is all about?
It's all about short-term opportunistic rebalancing due to a short-term change in one's asset allocation, uh, I mean opportunistic rebalancing, uh I mean rebalancing, uh I mean market timing.
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