Category Archives: Stock Trading

Stock Trading, US Stock Market

SPDR ETF Trading-2007-2010

Following is the trading summary with SPDR ETF Trading-2007-2010. The SPDR (S&P 500 ETF) is most preferred ETF – solid, reliable and always bounces back from the worst dark days.
Our trading experince with SPDR can be summarised in one line: Have faith in the SPDR and it will never disappoint you. There are many fads and fashions in the market, but only one lifetime friend, the SPDR.

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From March 2007 to April 2010, Our Simple ETF-based Portfolio Delivered 127% Gain compared to 13% Loss in S&P 500 ETF Over the Same Time Period

When we buy the Index ETFs, its like buying the entire market, which significantly reduces company specific risks. Even the best quality stocks can run into big trouble. For example, you know how Goldman Sachs fell 25% over 2 weeks in April 2010 due to legal issues.


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Stock Investments, Stock Trading

Can Investors Beat S&P500 with Market Timing?

Approximately 75% fund managers do not beat the S&P500 Index year in and year out. How can a basket of 500 hundred stocks beat the majority of actively managed mutual funds? The people who manage these funds are mostly brilliant people, highly educated, with access to the most advanced information and decision support systems in the world. So why can’t they outperform the S&P500 Index?

A Quick Test:
Here’s a very crude test of management performance: Let’s compare the domestic-equity mutual fund performance supplied by Morningstar against the S&P 500 index for one, three, five and ten-year periods, looking back from April 30, 1995. The S&P 500 index is a fair comparison for large, domestic companies.

Our results:
–Of the 1,097 funds Morningstar covered for the one-year period, 110 beat the S&P 500, while 987 fell short. Results ranged from 46.84% to -32.26%, while the S&P 500 attained a 17.44% return.

–During the three-year period, the S&P 500 returned 10.54%, while results in the funds varied from 29.28% to -15.02% compounded annually. Of the total 609 funds, only 266 beat the S&P 500.

–Shifting to the five-year period, of 470 funds, 204 beat the S&P 500. Results ranged from 27.35% to -8.51%, while the index racked up 12.62%.

–At ten years, only 56 of 262 funds managed to beat the index, and results varied from 24.77% to -4.06% compounded annually against 14.78% for the S&P 500. Continue reading Can Investors Beat S&P500 with Market Timing? →