RBD alert [Really Bad Day]

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iceport
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Re: RBD alert [Really Bad Day]

Post by iceport » Tue Feb 06, 2018 9:29 am

JCE66 wrote:
Tue Feb 06, 2018 7:59 am
Can someone remind me what course of action is recommended by the proponents of the RBD philosophy?
RBD Philosophy? WTH is that? Can you articulate it, because I am now genuinely curious. :shock:
I don't know if it's actually articulated anyplace. Based on this thread and this post by livesoft, it looks like a system that tells you to use your emotions to determine when it's time to check your IPS. :?
"Discipline matters more than allocation.” ─William Bernstein

bling
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Re: RBD alert [Really Bad Day]

Post by bling » Tue Feb 06, 2018 9:49 am

hmmm, i'm doing more research....

according to scottrade here's a quote relevant to me:
For example, say you purchase 100 shares of XYZ for $25 per share on Feb. 10. Nine days later, on Feb. 19, XYZ drops to $22 per share and you sell your 100 shares. You have a capital loss of $3 per share, or $300, which may be tax-deductible. If on Feb. 26 you bought the same security for $22.50 per share, this would be considered a wash sale because you sold and repurchased shares of the same stock within only a few days.
so that looks like i can actually do a TLH here...

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Re: RBD alert [Really Bad Day]

Post by Doc » Tue Feb 06, 2018 9:59 am

bling wrote:
Tue Feb 06, 2018 9:49 am
so that looks like i can actually do a TLH here...
Nope at 9:59 AM Easten the S&P futures were up some 2%.
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Re: RBD alert [Really Bad Day]

Post by The Wizard » Tue Feb 06, 2018 10:08 am

Doc wrote:
Tue Feb 06, 2018 9:59 am
bling wrote:
Tue Feb 06, 2018 9:49 am
so that looks like i can actually do a TLH here...
Nope at 9:59 AM Easten the S&P futures were up some 2%.
Not futures, ACTUALS...
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Re: RBD alert [Really Bad Day]

Post by iasw » Tue Feb 06, 2018 10:08 am

January market news had pictures of gleeful brokers on the exchange. Today, they looked stressed and freaking out. It's almost comical to juxtapose.

We've seen this coming, didn't know when, but we all knew eventually we'd see a correction (or more). And here we are.

Stick to IPS, ignore the news if it is stressful.

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Re: RBD alert [Really Bad Day]

Post by livesoft » Tue Feb 06, 2018 10:10 am

iasw wrote:
Tue Feb 06, 2018 10:08 am
We've seen this coming, didn't know when, but we all knew eventually we'd see a correction (or more). And here we are.

Stick to IPS, ignore the news if it is stressful.
I'm sticking to my IPS which says to buy something that has an RBD. Yes, we eventually will see a correction (or more), but here we ain't.
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Re: RBD alert [Really Bad Day]

Post by Doc » Tue Feb 06, 2018 10:12 am

The Wizard wrote:
Tue Feb 06, 2018 10:08 am
Doc wrote:
Tue Feb 06, 2018 9:59 am
bling wrote:
Tue Feb 06, 2018 9:49 am
so that looks like i can actually do a TLH here...
Nope at 9:59 AM Easten the S&P futures were up some 2%.
Not futures, ACTUALS...
You're ten minutes late. At 8:59 it was futures. :D
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Re: RBD alert [Really Bad Day]

Post by livesoft » Tue Feb 06, 2018 5:06 pm

iceport wrote:
Tue Feb 06, 2018 2:50 am
Huh. That's it? That's all there is to employing the fabled RBD System of market timing? You can even wait until the market closes, then just check rebalancing bands?

This sure seems anticlimactic, hardly worthy of an "alert." In the worst case scenario — say someone doesn't get the alert in time — the market pushes the asset allocations back within rebalancing bands and the investor misses an opportunity to bump up their trade count. (Of course, that could also end up being a better than rebalancing immediately if the market continues in the same direction the following day.)
Nah, that is not all there is to it. Advanced RBD players move 10% to 20% of their bond allocation into equities in an over rebalancing move for 1 hour to 1 week depending on their emotions.
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Re: RBD alert [Really Bad Day]

Post by The Wizard » Tue Feb 06, 2018 5:15 pm

livesoft wrote:
Tue Feb 06, 2018 5:06 pm
iceport wrote:
Tue Feb 06, 2018 2:50 am
Huh. That's it? That's all there is to employing the fabled RBD System of market timing? You can even wait until the market closes, then just check rebalancing bands?

This sure seems anticlimactic, hardly worthy of an "alert." In the worst case scenario — say someone doesn't get the alert in time — the market pushes the asset allocations back within rebalancing bands and the investor misses an opportunity to bump up their trade count. (Of course, that could also end up being a better than rebalancing immediately if the market continues in the same direction the following day.)
Nah, that is not all there is to it. Advanced RBD players move 10% to 20% of their bond allocation into equities in an over rebalancing move for 1 hour to 1 week depending on their emotions.
In addition to that, there's the psychological benefit of having a buy mentality at a time when less trained individuals might be questioning what to do next.

And note that we're talking about moving funds into a broad based stock index fund, not single company stocks...
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iceport
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Re: RBD alert [Really Bad Day]

Post by iceport » Tue Feb 06, 2018 11:10 pm

livesoft wrote:
Tue Feb 06, 2018 5:06 pm
iceport wrote:
Tue Feb 06, 2018 2:50 am
Huh. That's it? That's all there is to employing the fabled RBD System of market timing? You can even wait until the market closes, then just check rebalancing bands?

This sure seems anticlimactic, hardly worthy of an "alert." In the worst case scenario — say someone doesn't get the alert in time — the market pushes the asset allocations back within rebalancing bands and the investor misses an opportunity to bump up their trade count. (Of course, that could also end up being a better than rebalancing immediately if the market continues in the same direction the following day.)
Nah, that is not all there is to it. Advanced RBD players move 10% to 20% of their bond allocation into equities in an over rebalancing move for 1 hour to 1 week depending on their emotions.
Wow. I had no idea. Is there a summary of the strategy written out somewhere?

Honestly, relying on emotions to time the market successfully and reliably sounds like a fools errand. I'm surprised you undertake the effort, except possibly for the entertainment value.
"Discipline matters more than allocation.” ─William Bernstein

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Re: RBD alert [Really Bad Day]

Post by whodidntante » Tue Feb 06, 2018 11:16 pm

This teeny little rout was good for motivating me to do my backdoor Roth contribution. Go go gadget ex-US small caps!

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iceport
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Re: RBD alert [Really Bad Day]

Post by iceport » Tue Feb 06, 2018 11:18 pm

The Wizard wrote:
Tue Feb 06, 2018 5:15 pm
livesoft wrote:
Tue Feb 06, 2018 5:06 pm
iceport wrote:
Tue Feb 06, 2018 2:50 am
Huh. That's it? That's all there is to employing the fabled RBD System of market timing? You can even wait until the market closes, then just check rebalancing bands?

This sure seems anticlimactic, hardly worthy of an "alert." In the worst case scenario — say someone doesn't get the alert in time — the market pushes the asset allocations back within rebalancing bands and the investor misses an opportunity to bump up their trade count. (Of course, that could also end up being a better than rebalancing immediately if the market continues in the same direction the following day.)
Nah, that is not all there is to it. Advanced RBD players move 10% to 20% of their bond allocation into equities in an over rebalancing move for 1 hour to 1 week depending on their emotions.
In addition to that, there's the psychological benefit of having a buy mentality at a time when less trained individuals might be questioning what to do next.

And note that we're talking about moving funds into a broad based stock index fund, not single company stocks...
You too, Wizard? You also advocate market timing based on your emotions?

Through experience, I've gained the contrarian perspective you noted above. But I don't need to introduce emotion-based market timing to see it.

Possibly, you both have a far larger financial buffer than I do, and that emboldens you to play around a bit.
"Discipline matters more than allocation.” ─William Bernstein

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Re: RBD alert

Post by 2015 » Tue Feb 06, 2018 11:22 pm

thangngo wrote:
Mon Feb 05, 2018 3:56 pm
TLH alert...
Nope. As of today still have some gains left in both VTSAX and VTIAX. I don't hang any deeper at the poker table than with those two bets because it's usually way more smoky in the casino than I can stand.

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Re: RBD alert [Really Bad Day]

Post by 2015 » Tue Feb 06, 2018 11:26 pm

Da5id wrote:
Tue Feb 06, 2018 9:06 am
mariezzz wrote:
Mon Feb 05, 2018 9:46 pm
The psychological reaction I'm seeing is quite interesting. If the stock market had ended 2017 a little lower (about 6% lower) and we have gained 1-2% in 2018, to end up precisely where we are today, Feb. 5 2018, we'd all be happy.
Loss aversion. Recency bias. All real psychological phenomena. An important part of having a plan we believe in is to fight our all too human weaknesses.
You forgot overconfidence, which is readily apparent in this very thread.

I'm in Nevada right now. If I wanted to gamble with my money there are five casinos five minutes away who would be more than willing to take my money. But I know I can beat them. I have a "system".

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Re: RBD alert [Really Bad Day]

Post by bling » Thu Feb 08, 2018 6:48 pm

as per the rules of a RBD:
1. drop of 2.5% of more
2. drop greater than 4th largest drop in the previous 150 days
3. not a friday
we had two RBDs this week. did anyone action on monday? and if you did, did you action today?

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Re: RBD alert [Really Bad Day]

Post by livesoft » Thu Feb 08, 2018 6:53 pm

Wednesday morning was the time to sell your buys from Monday.

I will buy more shares tomorrow based on today's RBD.
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Re: RBD alert [Really Bad Day]

Post by triceratop » Thu Feb 08, 2018 6:56 pm

7.7M shares of VTI were transacted today; I think some people took action.

I did not. I will probably move 10% of my bond position to US TSM [VTI] tomorrow.
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Re: RBD alert [Really Bad Day]

Post by iceport » Thu Feb 08, 2018 7:01 pm

bling wrote:
Thu Feb 08, 2018 6:48 pm
as per the rules of a RBD:
1. drop of 2.5% of more
2. drop greater than 4th largest drop in the previous 150 days
3. not a friday
we had two RBDs this week. did anyone action on monday? and if you did, did you action today?
Good question. It seems to me, though, that these purveyors of the RBD system prefer to keep things shrouded in ambiguity.
"Discipline matters more than allocation.” ─William Bernstein

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iceport
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Re: RBD alert [Really Bad Day]

Post by iceport » Thu Feb 08, 2018 7:03 pm

livesoft wrote:
Thu Feb 08, 2018 6:53 pm
Wednesday morning was the time to sell your buys from Monday.

I will buy more shares tomorrow based on today's RBD.
Did you buy on Monday? And then did you sell on Wednesday? What will you buy tomorrow?

More generally, would you care to share an outline of your Advanced RBD system?
"Discipline matters more than allocation.” ─William Bernstein

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Re: RBD alert [Really Bad Day]

Post by livesoft » Thu Feb 08, 2018 7:05 pm

iceport wrote:
Thu Feb 08, 2018 7:03 pm
More generally, would you care to share an outline of your Advanced RBD system?
Of course not. It is written many times on this forum that if somebody discovered the road to easy wealth from buying and selling investments, then they would not divulge their secret.

I won't know what I will buy tomorrow until mid-morning tomorrow.
Last edited by livesoft on Thu Feb 08, 2018 7:06 pm, edited 1 time in total.
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Re: RBD alert [Really Bad Day]

Post by triceratop » Thu Feb 08, 2018 7:05 pm

generally: when livesoft expects stocks to go up (down) he either buys (sells) them or increases (decreases) exposure to them in his Roth IRA subject to staying close to his benchmark equities allocation. The RBD is a way of excusing market timing by having something concrete to add to an IPS and say "I am following my IPS".
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Re: RBD alert [Really Bad Day]

Post by Da5id » Thu Feb 08, 2018 7:08 pm

livesoft wrote:
Thu Feb 08, 2018 7:05 pm
iceport wrote:
Thu Feb 08, 2018 7:03 pm
More generally, would you care to share an outline of your Advanced RBD system?
Of course not. It is written many times on this forum that if somebody discovered the road to easy wealth from buying and selling investments, then they would not divulge their secret.

I won't know what I will buy tomorrow until mid-morning tomorrow.
Honestly curious, would you consider stating your motivation for posting cryptic things about your "RBD system"? Because I have difficulty seeing positive motivation to do so.

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Re: RBD alert [Really Bad Day]

Post by iceport » Thu Feb 08, 2018 7:11 pm

triceratop wrote:
Thu Feb 08, 2018 7:05 pm
generally: when livesoft expects stocks to go up (down) he either buys (sells) them or increases (decreases) exposure to them in his Roth IRA subject to staying close to his benchmark equities allocation. The RBD is a way of excusing market timing by having something concrete to add to an IPS and say "I am following my IPS".
Thank you!

(I guess I'm not wealthy enough to play around with my life savings like that.)
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Post by acanthurus » Thu Feb 08, 2018 7:12 pm

Removed
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Re: RBD alert [Really Bad Day]

Post by livesoft » Thu Feb 08, 2018 7:24 pm

Da5id wrote:
Thu Feb 08, 2018 7:08 pm
Honestly curious, would you consider stating your motivation for posting cryptic things about your "RBD system"? Because I have difficulty seeing positive motivation to do so.
For the RBDs so far in 2018 I haven't posted much except when asked. For most investors, RBDs are good days to consider whether they need to rebalance and/or tax-loss harvest. They can pretty much ignore almost all other days of the year.

Also another thing: One should not wait to buy on an RBD. One should just invest when they have money to invest. On an RBD, they can simply exchange from bond funds to equity funds.

My motivation back when I first mentioned RBDs was to get people to have no fear of rebalancing on the lowest days of the year for their equity investments. I have seen many posts that have stated "I stayed the course and didn't sell anything." Yes, but you didn't buy anything either which I'm sure managers of LifeStrategy and TargetRetirement funds did today.

Hmmm, this reminds me to make my Roth IRA contribution tomorrow, too.
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Re: RBD alert [Really Bad Day]

Post by StevieG72 » Thu Feb 08, 2018 7:31 pm

bling wrote:
Thu Feb 08, 2018 6:48 pm
as per the rules of a RBD:
1. drop of 2.5% of more
2. drop greater than 4th largest drop in the previous 150 days
3. not a friday
we had two RBDs this week. did anyone action on monday? and if you did, did you action today?
I purchased 10k of VTIAX, thought I missed the opportunity when the market rallied slightly. Pulled the trigger when I realized it was a dead cat bounce.
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Re: RBD alert [Really Bad Day]

Post by bling » Thu Feb 08, 2018 7:36 pm

acanthurus wrote:
Thu Feb 08, 2018 7:12 pm
I TLH'd from VWO to IEMG yesterday. Looks like I'll be back in VWO in 30 days :oops:
haha, i performed the same trade. my IEMG position is currently down 5.25%. this may soon turn into a VWO->IEMG->SCHE->EEM triple TLH.

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Re: RBD alert [Really Bad Day]

Post by Da5id » Thu Feb 08, 2018 7:51 pm

livesoft wrote:
Thu Feb 08, 2018 7:24 pm
Da5id wrote:
Thu Feb 08, 2018 7:08 pm
Honestly curious, would you consider stating your motivation for posting cryptic things about your "RBD system"? Because I have difficulty seeing positive motivation to do so.
For the RBDs so far in 2018 I haven't posted much except when asked. For most investors, RBDs are good days to consider whether they need to rebalance and/or tax-loss harvest. They can pretty much ignore almost all other days of the year.

Also another thing: One should not wait to buy on an RBD. One should just invest when they have money to invest. On an RBD, they can simply exchange from bond funds to equity funds.

My motivation back when I first mentioned RBDs was to get people to have no fear of rebalancing on the lowest days of the year for their equity investments. I have seen many posts that have stated "I stayed the course and didn't sell anything." Yes, but you didn't buy anything either which I'm sure managers of LifeStrategy and TargetRetirement funds did today.

Hmmm, this reminds me to make my Roth IRA contribution tomorrow, too.
Hmm, I had the sense there was more to it than that somehow. Lifestrategy/Target Retirement do "continuous rebalancing", which as far as I"ve read is no better than any other strategy. As for me, haven't had to rebalance yet from the current correction. I'm targetting 50/50, started slightly positive stocks from runup, after today's close 51% bonds/49% stock. Keeping an eye on it though. No TLH available either other than a few hundred dollars (not bothering) on a taxable bond fund.

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Re: RBD alert [Really Bad Day]

Post by livesoft » Thu Feb 08, 2018 7:55 pm

Da5id wrote:
Thu Feb 08, 2018 7:51 pm
Lifestrategy/Target Retirement do "continuous rebalancing", which as far as I"ve read is no better than any other strategy.
What you read and especially what Portfolio Visualizer might tell you are not Reality. Because human beings are Normal People, they are not rational and do not follow what something like Portfolio Visualizer would do in backtesting. For instance, they will hesitate to rebalance into equities when the stock market looks terrible. They will delay contributions when the stock market looks terrible. I think having an action plan for RBDs reduces some behavioral pitfalls for some investors.

I wish to also state that not every RBD is a big win. I think it is impossible to have a 100% perfect strategy. So if one loses extra money sometimes, then that is expected as long as one doesn't make a habit out of it.
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Re: RBD alert [Really Bad Day]

Post by texas lawdog » Thu Feb 08, 2018 8:12 pm

I invested some additional cash again today...mostly because my trigger finger was getting itchy and I hate passing up bargains.
At the rate this market is going, I will be done with most of my Q1 allocations into equities well before my deadline of March 31.
These are interesting times, indeed, but remember to keep it all in perspective with your long game.

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Re: RBD alert [Really Bad Day]

Post by overthought » Thu Feb 08, 2018 10:16 pm

I got lucky... I front-load my 401(k) and my provider took a whole week to process my 31 Jan paycheck. So instead of getting in at near-peak and promptly losing 10%, the contribution is only down 0.7% as of tonight 8-)

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Re: RBD alert [Really Bad Day]

Post by victw » Thu Feb 08, 2018 11:22 pm

texas lawdog wrote:
Thu Feb 08, 2018 8:12 pm
I invested some additional cash again today...mostly because my trigger finger was getting itchy and I hate passing up bargains.
My trigger finger is also itchy - but I choked on moving declining bonds to equities. Also we are really only back to where we were 3 months ago. And I'm even more confused because my stock/bond allocation has not budged at all.

I'm wondering how you define a bargain?

Vic

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Re: RBD alert [Really Bad Day]

Post by whodidntante » Thu Feb 08, 2018 11:47 pm

acanthurus wrote:
Thu Feb 08, 2018 7:12 pm
I TLH'd from VWO to IEMG yesterday. Looks like I'll be back in VWO in 30 days :oops:
There is a third option in case you want to TLH at day 29.

https://us.spdrs.com/en/etf/spdr-portfo ... s-etf-SPEM

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Re: RBD alert [Really Bad Day]

Post by weltschmerz » Fri Feb 09, 2018 1:00 am

I recommend: just stand there and do nothing. I remember 2008, when the market would be down big, and I kept buying. Big mistake. I bought at s&p 1400, 1300, 1200 then bailed out as the market plummeted further. Heck, this market has only dropped back to where we were in November. 3 months ago! We might have a lot farther to fall. Keep your powder dry folks.

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Re: RBD alert [Really Bad Day]

Post by msk » Fri Feb 09, 2018 1:13 am

So far only -10% from peak? Yawn. Wake me up when it reaches -20%, first little action in my investment plan; next at -30%, more aggressive action, next at -35%, next at -40%... Each BUY will get steadily more aggressive (buying Calls using margin). I am already 100% stocks :mrgreen: I am absolutely, 100% certain, that the markets worldwide will not collapse to zero. Famous last words :confused

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Re: RBD alert [Really Bad Day]

Post by livesoft » Thu Feb 15, 2018 9:37 am

iceport wrote:
Tue Feb 06, 2018 11:10 pm
livesoft wrote:
Tue Feb 06, 2018 5:06 pm
iceport wrote:
Tue Feb 06, 2018 2:50 am
Huh. That's it? That's all there is to employing the fabled RBD System of market timing? You can even wait until the market closes, then just check rebalancing bands?

This sure seems anticlimactic, hardly worthy of an "alert." In the worst case scenario — say someone doesn't get the alert in time — the market pushes the asset allocations back within rebalancing bands and the investor misses an opportunity to bump up their trade count. (Of course, that could also end up being a better than rebalancing immediately if the market continues in the same direction the following day.)
Nah, that is not all there is to it. Advanced RBD players move 10% to 20% of their bond allocation into equities in an over rebalancing move for 1 hour to 1 week depending on their emotions.
Wow. I had no idea. Is there a summary of the strategy written out somewhere?

Honestly, relying on emotions to time the market successfully and reliably sounds like a fools errand. I'm surprised you undertake the effort, except possibly for the entertainment value.
I got an emotion about the things bought on recent RBDs gaining 4+%, so I have to sell them. Basically, money in my bonds funds was switched to risky assets, made money, and switched back to bond funds which had in the meantime lost money.
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Re: RBD alert [Really Bad Day]

Post by iceport » Thu Feb 15, 2018 10:00 am

livesoft wrote:
Thu Feb 15, 2018 9:37 am
iceport wrote:
Tue Feb 06, 2018 11:10 pm
livesoft wrote:
Tue Feb 06, 2018 5:06 pm
iceport wrote:
Tue Feb 06, 2018 2:50 am
Huh. That's it? That's all there is to employing the fabled RBD System of market timing? You can even wait until the market closes, then just check rebalancing bands?

This sure seems anticlimactic, hardly worthy of an "alert." In the worst case scenario — say someone doesn't get the alert in time — the market pushes the asset allocations back within rebalancing bands and the investor misses an opportunity to bump up their trade count. (Of course, that could also end up being a better than rebalancing immediately if the market continues in the same direction the following day.)
Nah, that is not all there is to it. Advanced RBD players move 10% to 20% of their bond allocation into equities in an over rebalancing move for 1 hour to 1 week depending on their emotions.
Wow. I had no idea. Is there a summary of the strategy written out somewhere?

Honestly, relying on emotions to time the market successfully and reliably sounds like a fools errand. I'm surprised you undertake the effort, except possibly for the entertainment value.
I got an emotion about the things bought on recent RBDs gaining 4+%, so I have to sell them. Basically, money in my bonds funds was switched to risky assets, made money, and switched back to bond funds which had in the meantime lost money.
It is ironic that behavioral finance is one of your particular interests. :?
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