Livesoft: Worst day?

[rr2]

Livesoft --

Is today a worst day?

[hsv_climber]

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.

[livesoft]

Close, but not yet.

[dbonnett]

lost my copy of manual....please supply link....

[rr2]

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

[Noobvestor]

viewtopic.php?p=780576

viewtopic.php?p=510976

Not sure if/where there is a 'manual' per se :S

[rr2]

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

The link you provide just points back to this topic.

[Noobvestor]

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

[SP-diceman]

Is it one of the 10 days????




Thanks
SP-diceman

[chaz]

Close, but not yet.

Very close.

[hsv_climber]

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.

[rr2]

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.

[gkaplan]

What happened today?

[SP-diceman]

What happened today?

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




Thanks
SP-diceman

[livesoft]

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.

[natureexplorer]

Is there a definition of worst week, month, year, decade, century as well?

[mas]

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

[Noobvestor]

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 ...

[livesoft]

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.

[pmcgillicutty]

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

Livesoft: Loved your most recent response.

[Taylor Larimore]

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.

[hsv_climber]

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?

[livesoft]

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?

[Ed 2]

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.

[Sidney]

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.

[gkaplan]

My water pump went out on 10/19/1987.

[Taylor Larimore]

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."

[jpsfranks]

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.

[hsv_climber]

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.

[Ron]

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 . 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

[jpsfranks]

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".

[natureexplorer]

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.

[am]

I rebalanced into Wellington in 1932 and have been rewarded handsomely.

[Noobvestor]

I rebalanced into Wellington in 1932 and have been rewarded handsomely.

Are you ... serious? You've owned Wellington since 1932??? Or am I just that gullible? :/

[hsv_climber]

We will probably hit "worst" day on all International Funds today.

[livesoft]

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".

[YDNAL]

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%

[neverknow]

..

[555]

How about calling it a "really bad day trading strategy"?

Instead, I am going to call this the "really bad day" strategy.

[Opponent Process]

maybe just an RBD for Korea today.

[YDNAL]

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.

[GammaPoint]

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

[livesoft]

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?

[hsv_climber]

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.

[Noobvestor]

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

[Noobvestor]

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

[JimB66]

Here's the Beta

Well done!

[xram]

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

[rr2]

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?

[livesoft]

Yep. Is that what the fuss is all about?