FAQ 1-Timing System Introduction

Web Site and 401k Trend Market Timing System Questions and E-mail Alert Questions:

If you reached this page directly from an internet search, please review the 401k Trend market timing system home page at 401ktrend.com first

What is a “market trend indicator”?

A “market trend indicator” points to the future market direction that is most probable.  Index Funds and other stock mutual funds commonly held in 401k accounts and Roth IRAs will perform comparably to the Major Market Index Trend Indicators.   A“market trend indicator” has up to 4 modes:

  1. “Up”: Suggests that the current long-term market trend for the indices represented is likely to be “Up” or flat. 
  2. “Hold-Reduce”: Suggests that the current long-term market trend is unclear – the trend may be flat, slightly up, or moving down. A “Hold-Reduce” indicator usually occurs after the market makes a significant move up, and the upward movement has lost momentum.  The publisher will typically reduce exposure and move from aggressive growth funds to conservative positions due to the increased market risk.
  3. “Down”: Suggests that there is a significant risk of a downward move or flat movement.   Typically occurs in a bear market.
  4. “Major Down”: There is large risk of a major downward move (bear market).

How does a market trend indicator work?

A market trend indicator is based on stock technical analysis.  Each timing indicator uses a formula that measures several different conditions that affect market movement.   Indicators are influenced by S&P 500 price changes, market volume, economic news events, calendar impact, and other factors.  The point the publisher enters/exits positions is the day after the indicator changes.

What indicators are published within the 401k Trend Market Timing System?

  1. Indicator #1, the “Major Market Timing Trend Indicator” (Long-Term): Index mutual funds and most stock mutual funds are compatible with this long term market timing indicator. Indicator #1 is best for long-term investors who spend less time researching and monitoring their investments.
  2. Indicator #2, the “Major Market Timing Trend Indicator” (Short-Term):  Compatible with the same funds as indicator #1, except that #2 indicator is shorter-term and more aggressive (requires taking on increased market risk).   Indicator #2 is for investors who spend more time researching and monitoring their investments, and have access to aggressive funds.
  3. Indicator #4, the “REIT Index Timing Indicator”.  This indicator is intended to track some REIT mutual funds, including the DJ Composite REIT Index (IYR), the Fidelity Real Estate Investment Fund (FRESX), and others.

Why did the publisher create these market timing tools?

  1. The publisher’s 401k account and Roth IRA accounts lost substantially in the down turn of 2001-2002. Having moved out of mutual funds in 2002, he then failed to capitalize on the sharp upward move in 2003.
  2. He searched for tools to enter/exit mutual funds – specifically for his 401k. He found many market timing signals for short-term traders, but little for those who simply want help managing their 401k accounts and Roth IRAs.
  3. After reading up on the techniques that professional Wall Street traders use, the publisher spent hundreds of hours developing, testing, & tuning computer programs, and eventually creating the 401k Trend market timing system tool. The publisher has an education in engineering and a career in software development.  The Major Market Index Indicator #1 is back-tested to 1985 and went live on this web site in 2006.

How does the 401k Trend market timing system benefit the publisher’s investing?

  1. The timing system keeps the publisher invested during small, “unproductive” down signals. (“HOLD-REDUCE” indicator). The system is less likely to miss large up trends.
  2. The system indicates major down turns, such as the bear markets of 2001-2002 and 2008-2009 (“DOWN” indicator).  
  3. The market timing indicators highlight opportunities to enter aggressive positions during shorter up-trends (“UP” indicator), and provides other guidance on mutual fund allocation.

Why is actively managing my retirement plan, 401k, and mutual funds important?

  1. Many mutual funds lost several years worth of gains during the 2001-2002 bear market.   Many people were invested in high-risk aggressive growth funds that lost 80%+.  In the most recent bear market (2008-2009), the stock market lost 40-50% of its value at the lowest point.
  2. During the period from 2000-2010 the S&P 500 was flat, meaning a buy & hold investor would have lost money due to inflation.
  3. Avoiding large losses could increase your annual 401k and Roth IRA mutual fund returns by several percentage points or more.  Even small performance improvements will enhance mutual fund returns and 401k growth because the income is tax-deferred.
  4. Many companies are eliminating pensions and offering 401k contributions instead. Managing your retirement plan is left up you, whether it is through hiring a financial advisor or managing it yourself.  Hedge funds are typically only available for those willing to invest $50,000 or more.

Will the 401k trend trading tools increase market returns, help with my 401k growth, improve mutual fund returns, achieve maximum 401k returns, or help with Roth IRA returns?

The 401k trend market timing system helps educate investors on use of market timing signals and trend trading to help improve improve returns over time.  The 401k Trend has both a long-term market timing indicator and a shorter-term market indicator;  both timing indicators (trading signals) are suitable for 401k and other accounts that restrict short term trading and require less frequent trading.

What trading strategies are compatible with the 401k Trend market timing system?

  1. QQQQ timing
  2. Long term market timing
  3. 401k and mutual fund market timing
  4. Rydex fund timing
  5. Profunds timing
  6. Exchange Traded Fund timing
  7. Stock timing for ETFs and some stocks
  8. Market timing of other retirement accounts (403b, SEP IRA). 

The 401k Trend market signals and accompanying trading strategy provide a means to move between aggressive growth funds and conversative funds when the market trend changes.

How does the 401k Trend market timing system help me manage market risk?

The subscriber’s Roth IRA or 401k benefits from staying out of stock mutual funds when heightened market risk or a bear market is present.   The market indicators also help recognize when the market trend is moving from down to up.

What are warning alerts and advisories?

Communications may be issued on www.401ktrend.com if there is potential for an upcoming indicator change. The intent is to ensure that readers frequently monitor the web-site for updates following the alert.

Can I be notified of timing indicator changes?

Yes, use the register button and page to provide us with your contact info. We will e-mail you when a signal change occurs. Your personal contact data is secure and will not be redistributed.

The sign-up (register) button doesn’t work for me. Why?

Browser cookies must be enabled for the sign-up form to work.  Turn cookies on temporarily to allow you to sign-up.

I haven’t seen an indicator or performance update on the site for a few weeks, are you monitoring the site?

Yes, the publisher monitors the indicators daily and will immediately update the site and send out an e-mail to all registered users if an indicator changes. The publisher has monitored the system EVERY trading day since the site was launched in 2006.  There are quiet market periods when market timing conditions do not change and the web site is updated less frequently.

The publisher typically update performance after indicators change, which is infrequently (once every few months). 

We provide alert e-mails only when a new trend is likely to occur – we don’t provide e-mail’s like a “daily newsletter”.

Although we monitor the stock market and indicators daily, we only send e-mails when one of our indicator changes. Indicator #1 typically only changes once every 1-4 years. Indicator #2 typically changes 3-5 times per year.

You likely won’t see e-mails more than 4-10 times year.

I must have missed the 3/10/09 long call in my email. Do you email when a market timing signal changes, or does one have to monitor the site. Too bad for me, as it was a great call. Please make certain my email is registered with you so that I will see further signals. Keep up the good work.

An e-mail was delivered for the 3/10/09 change – looks the e-mail to you went out after midnight (meaning 3/11/09) – see attached document. Note that the e-mail will only state that there was an indicator change, “please refer to the site”.

Perhaps your company e-mail system or e-mail provider marked the message as spam. If you are concerned provide me with your e-mail address and a phone number and I can send you a test e-mail. I need the phone number to call you in case you don’t respond to the e-mail (meaning you didn’t receive it).

Is this short term market timing?

  1. The 401k Trend approach using indicator #1 emphasizes reallocating funds based on market conditions and indicators.  Most indicator #1 changes will last several months or years and will not constitute short-term timing. On rare occasion an indicator #1 trend may last under a month.
  2. Indicator #2 is a shorter-term timing indicator, but typically only changes every 1-6 months.

What is market timing? Is this a form of market timing?

  1. The 401k Trend system is market timing. The publisher’s goal in creating 401k Trend was not to create a “market timing” system, but rather to create a tool to enable him to stay invested in mutual funds most of the time, but reallocate holdings from aggressive mutual funds to more conservative investments when increased risk is present.
  2. Please search “market timing” on the internet for further information.

I read that market timing doesn’t work. My mutual fund company or 401k provider recommends against market timing.

  1. A very short-term market timing may not work for 401k and other long-term investors, but periodic reallocation of mutual fund holdings based on market conditions can be beneficial.
  2. Mutual fund company’s earnings are based on the amount invested in each mutual fund – if you aren’t invested, they don’t get paid. They would naturally discourage against exiting their funds.
  3. There is strong incentive to actively manage your mutual funds with market timing – “buy and hold” strategies have not worked for extended periods in the past, most recently during the period from 2000-2010.

Why is the web site free?

  1. Because the 401k Trend timing system was new in 2006, there was not an accumulated history of “live” indicator changes – the system is in a “proof of concept” phase for several years.  The system is without subscription fee as a result.
  2. Some subscribers have profited from successful “UP” indicators, and have suggested the publisher accept voluntary contributions.  We may begin accepting contributions in the future.
  3. Please promote our site by telling a friend interested in investing.  The more subscribers we have the longer we can keep it free by paying the bills with advertising revenue.

What are the risks with the tools?

There are significant risks. Please thoroughly read the “legal disclaimer” to understand the risks. The system is experimental.  The indicators are not successful all of the time, meaning there will be missed opportunities and losses at times.   Som market risk is always present, and the market can reverse and fall very quickly during “UP” trends.

Does the publisher of use the 401k Trend indicators?

The publisher risks all of his 401k account according to the “major market trend indicators”.

The market has been steadily increasing. Why should I be concerned about taking my money out?

  1. Up trends don’t last forever, and years of gains could be completely wiped out in a few short months as was in case in 2001-2002 and 2008-2009.
  2. Bull markets typically last 4-5 years, followed by a 1-2 year bear market. The cycle frequently repeats.

My email address has changed.  Can you please update your 401k Trend e-mail registration records?

Please change your e-mail address yourself by clicking on the links at the bottom of one of our 401k Trend e-mails or using the following links:

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Does my company’s 401k plan contain compatible funds?

Company 401k Plans with Compatible Mutual Funds:  The following company 401k plans contain one or more index mutual funds or equity mutual funds, which are typically compatible with 401k Trend market timing indicators and system.  Any index fund that resembles the S&P 500 or another major stock market index will typically be compatible.   The publisher has not verified compatibility of all funds.

3M
ABBOTT LABORATORIES
ACTIVISION
ADOBE SYSTEMS
AES
AKAMAI TECH
ALASKA AIRLINES
ALBERTSONS
ALCOA
ALLEGHENY TECHNOLOGIES
ALLSTATE
ALTERA
ALTRIA GROUP
AMAZON.COM
AMERICAN ELECTRIC
AMERICAN EXPRESS
AMERICAN INTL GROUP
AMERICAN POWER CONVERSION
AMERICAN AIRLINES
AMGEN
AMYLIN PHARMA
ANHEUSER BUSCH
APOLLO
APPLE COMPUTER
APPLIED MATERIALS
AT&T
ATI TECHNOLOGIES
AUTODESK
AVON PRODUCTS
BAKER HUGHES
BANK OF AMERICA
BAXTER INTL
BEA SYSTEMS
BED BATH & BEYOND
BIOGEN
IDEC
BANK OF AMERICA
BLACK & DECKER
BOEING
BRISTOL MYERS SQIBB
BRITISH PETROLEUM
BROADCOM
BURLINGTON
C.H. ROBINSON
CADENCE DESIGN
CAMPBELL SOUP
CARDINAL HEALTH
CATERPILLAR
CBS CORP
CDW CORP
CELGENE
CHECK POINT SOFTWARE
CHECKFREE CORP
CHEVRON
CIGNA
CINGULAR WIRELESS
CINTAS
CISCO
CITIGROUP
CITRIX SYSTEMS
CLEAR CHANNEL
COCA COLA
COGNIZANT TECH
COLGATE PALMOLIVE
COMCAST
COMPUTER SCIENCES
COMVERSE
COSTCO WHOLESALE
COUNTRYWIDE FINANCIAL
DELL
DENDREON
DISCOVERY
DOW CHEMICAL
DU PONT
EMC
EASTMAN KODAK
EBAY
ECHOSTAR
ELECTRONIC ARTS
ENTERGY
EXELON
EXPEDIA
EXPEDITORS INTL
EXPRESS SCRIPTS
EXXON MOBIL
FASTENAL
FEDERAL EXPRESS
FEDEX
FISERV
FISHER
FLEXTRONICS
FORD MOTOR CO
FUTUREFUEL
GARMIN
GENERNAL DYNAMICS
GENERAL ELECTRIC
GENERAL MOTORS
GENZYME CORPORATION
GILEAD SCIENCES
GOLDMAN SACHS
GOOGLE
GROUP HEALTH
HALLIBURTON
HARRAH’S ENTERTAIN
HARTFORD FINANCIAL
HCA
HEINZ H J
HEWLETT PACKARD
HOME DEPOT
HONEYWELL INTL
HSBC
IAC/INTERACTIVE
IBM
ICOS
INTEL
INTUIT
ITT
JOHNSON AND JOHNSON
JOHNSON CONTROLS
JP MORGAN CHASE
KCTS
KROGER
ERICSSON
LOCKHEED MARTIN
LOWES
MAZDA
MCDONALDS
MEDIACOM
MERCK
MICROSOFT
NIKE
NORDSTROM
NORTHWEST
OHIO PUBLIC EMPLOYEES
PACCAR
PFIZER
PREMERA
PROCTER GAMBLE
QWEST
RAYTHEON
SEARS HOLDINGS
STARBUCKS
TARGET
TIAA-CREF
TYCO INTERNATIONAL
U.S. GOVERNMENT
UNITED TECHNOLOGIES
UNITED PARCEL (UPS)
VERIZON
WAL MART
WALT DISNEY
WASHINGTON MUTUAL
WELLS FARGO
WEYERHAEUSER