5/24 Update

"Sell in May and go away".... looks like the wisdom of the ages is accurate again.  In fact, according to Indexuniverse.com, 'since 1950, the Dow has appreciated 7.4% on average (from April through September), versus only a 0.4% average return in the May 1 through October 31 interval.'  This year has been no different.  Since the beginning of May, Commodities are down 11.23%, S&P 500 is down 3.7%, Emerging Markets are down 7.9%, and Silver is down 25%... ugh.  On the positive side, Gold and Treasuries have held their value and even increased a couple of ticks.


The numbers don't lie.  At the beginning of May, we were up over 12% and were way up over the other benchmarks.  Today, after a solid decline across all asset classes, especially silver and the commodities, here are the benchmark comparisons for 2011.

	Jan 24, 2011	today	% Change
My Portfolio	$99,994.75	$102,993	3.00%
S and P 500	1282	1317	2.73%
FTSE 100	5943	5858	-1.43%
Commodities Index (GSG)	33.99	34.67	2.00%
20 Year Treasury (TLT)	92.43	95.78	3.62%

The good (aka... tough, frustrating, annoying) news is that despite the recent declines and the negative fundamental buzz out there, we are still quite far from any of my absolute sell signals.  I add those adjectives in parentheses because watching my portfolio decline like this makes sitting on my hands and not making any emotional trades that much more difficult.  1) The relative strength of the S&P 500 to Cash still points definitively to owning stocks.  2) The other relative strength relationships are all still pointing in the right direction.  3) The point and figure charts of the holdings in the portfolio are all still quite far from their respective trend lines, which would create definitive sell signals.  

Bottom line is that as of today, the recent market activity points to more of a "breather" or a pause for the markets than an overall shift in momentum.  Only time will tell if we need to get out the life jackets and jump ship.  For now, turn off the TV, get out the golf clubs and wait it out...

Happy Investing!