Subscriber Newsletter Features and Portfolio Performance through July 2008

One of purposes of the subscriber newsletter blog is to provide a space in which to summarize the recent content in the newsletter and update the performance of the model portfolios that I make available to newsletter subscribers. Since their March 30, 2008 launch, the four (equities only, long only) portfolios have performed as follows:

In addition to the model portfolios, the subscriber newsletter continues to incorporate a number of regular weekly sections, including a market commentary, asset class outlook, market sentiment update, current investment thesis, and week in review. Features generally focus on subjects such as sector rotation, volatility, put to call ratios, market breadth, volume, and other sentiment-related issues. Some of the July features included:

• A Speculative VIX Options Play
• A Weekday Perspective on the May to July Drop
• A Bond VIX for Evaluating Risk in Financials
• The Health of Corporate Bonds as a Market Indicator
• An Early Glance at the OVX
• Recent Sector Performance Trends (excerpted on the blog as Sector Performance in the Last Two Bull Moves)
• Should the VIX Be Spiking Higher?
• How About that VIX Spike?
• Are VIX Spikes Good Long Entries?
• Volatility Spikes and the 2002 Bottom
• Volatility and the 1998 LCTM Crisis
• A VIX:VXV Update
• The VIX:VXV Ratio Continues to Impress
• Q&A: Tweaking the PSAR for 60 Minute Bars
• Annual Volatility and Market Performance
• Technology Leadership Needed

If anyone has any additional questions or comments about the subscriber newsletter, or is interested in a sample newsletter, please feel free to email me at bill.luby@gmail.com

Subscriber Newsletter Portfolio Performance through June 2008

One of purposes of the subscriber newsletters blog is to provide a space in which to summarize the recent content in the newsletter and update the performance of the model portfolios that I make available to newsletter subscribers. Since their March 30, 2008 launch, the four (equities only, long only) portfolios have performed as follows:

In addition to the model portfolios, the subscriber newsletter includes a number of regular weekly sections, including a market commentary, asset class outlook, market sentiment update, current investment thesis, and week in review. Features generally focus on subjects such as sector rotation, volatility, put to call ratios, market breadth, volume, and other sentiment-related issues. Some of the June features have included:

• Lehman Brothers and the VIX
• XLF Put to Call Ratios
• One Enhancement to the VIX:VXV Ratio Indicator
• Volatility and Options Expiration Week
• VIX Implied Volatility Calculations
• The ISEE Equities Only Index Is Bullish
• Elevated QID Volume Levels Are Bullish
• ETF Volume: A Broader Application of the QID Theme
• ETF Volume in Financials and Other Sectors
• NASDAQ McClellan Oscillator Update
• Contrary Sentiment Analysis Revisited
• Sector Rotation: Which Will Rebound, Oil or Financials?

If anyone has any additional questions or comments about the subscriber newsletter, please feel free to email me at bill.luby@gmail.com

Subscriber Newsletter Portfolio Performance through May

As I hinted at yesterday in Portfolio A1 Performance Update: 5/31/08, PortfolioA1, which I updated here on a weekly basis from February 2007 through April 2008, has been tweaked and enhanced to create the VIX and More Focus Aggressive Trader Model Portfolio.

In fact, the subscriber newsletter has four model portfolios that I make available to newsletter subscribers. Since their March 30, 2008 launch, the four (equities only, long only) portfolios have performed as follows:

• Focus Aggressive Trader: +16.93%
  
  
• Focus Growth: +3.25%
  
  
• Focus Foreign Growth: +9.75%
  
  
• Stock of the Week Sequential Portfolio: +64.58%

In addition to the model portfolios, the subscriber newsletter includes a number of regular weekly sections, including a market commentary, asset class outlook, market sentiment update, current investment thesis, and week in review. Features generally focus on subjects such as sector rotation, volatility, put to call ratios, market breadth, volume, and other sentiment-related issues. Some of the May features have included:

• Technology Leadership Is Bullish
• New Picks from the Volatility-Based Sector Rotation Model
• Interpreting the Recent Low VIX
• An Expanded Look at the VIX:VXV Ratio
• Measuring Complacency
• ETF Reversal Swing Trader
• Trading Oil with ETFs
• Different Ways to Cross the 200 Day SMA
• The Role of Speculation in Oil Prices
• Oil, Energy, and Correlations

I continue to be pleased by the feedback from subscribers, which has included the following comments:

I really appreciate all your help and the thoughtful views you have of the market…It appears you have a knack for picking the stock of the week! -- PP, USA

You've blogged only rarely on the broader thrust of the newsletter. It comes off as applied VIX, or perhaps punches up the "..and More" part of "VIX and More". -- DK, USA

The newsletter is exactly what I am looking for. -- MD, Germany

I loved your Sunday edition. Congrats on the success of your picks. -- VH, USA

For more information on the subscriber newsletter contents, check out a blog that I have dedicated to the subscriber newsletter: VIX and More Subscriber Newsletter Blog.

If anyone has any additional questions or comments about the subscriber newsletter, please feel free to email me at bill.luby@gmail.com

Subscriber Newsletter Update

I have received a number of questions about the subscriber newsletter and I thought this might be a good time to address them.

First, thanks to all who have subscribed. I have been extremely pleased by the response to date. I appreciate all the support and am particularly encouraged by the fact that so far the renewal rate has been 100%.

In terms of content, the Sunday format has already been standardized. The typical Sunday issue is six pages long and has the following sections:

• The Week in Review – my thoughts on what constituted the important macroeconomic, fundamental, and technical news for the past week
• The Week Ahead: What to Look For – includes suggestions on earnings to watch, important government data releases, critical technical support/resistance levels, etc.
• Market Sentiment Update – a discussion of the readings and related implications from two of my proprietary sentiment indicators, the Options Sentiment Indicator (OSI) and the Aggregate Market Sentiment Indicator (AMSI). In some respects these two indicators are descendants of the VIX Weekly Sentiment Indicator (VWSI)
• Asset Class Outlook – where I update my outlook over the short-term (1-3 weeks), intermediate-term (1-3 months), and long-term (6-12 months) time frames for ten important asset classes that cover US equities, foreign equities, bonds, currencies, and commodities
• Current Investment Thesis – my take on what is driving the markets, in which direction, and why
• VIX and More Focus Model Portfolios – three different model portfolios (Aggressive Trader, Growth, and Foreign Growth) consisting of 5-7 stocks each that have returns of +18.0%, -2.7%, and +2.1% since the March 30, 2008 inception
• Stock of the Week – a single weekly stock selection that has a cumulative return of +48.5% since the initial March 30^th selection

The Wednesday issue is much more like the blog, but with a more detailed analysis and a place where I offer more in terms of conclusions and takeaways. It generally runs 4-6 pages and has three standard sections:

• Market Commentary – updates my thinking as laid out on Sunday
• Market Sentiment Update – similar to the Sunday section, but may drill down more on specific issues, such as volatility, put to call data, market breadth, volume, etc.
• Volatility-Based Sector Rotation Model – one of my current research interests is using volatility to time trades on a variety of ETFs, including sectors, geographies, commodities, and currencies. This is not a model portfolio, per se, but I have been providing commentary on what the model is suggesting in terms of sector rotation strategies, what geographies to be long or short in, as well as plays in commodities and currencies

In addition to the three standard sections, Wednesday usually includes several feature sections where the subject matter varies from week to week. Some of the features from the past three issues include:

• The VIX:VXV Ratio Continues to Perform Well
• NYSE Total Volume Suggests Rally May Have Run Out of Steam
• ‘Stock of the Week’ Averages Up 5% in One Day
• CBOE Equity Put to Call Ratio Remains Bullish (a shorter, updated version of this post went up on the blog a week later)
• A Long-Term Look at the VIX and the VXN
• Yield Curve Déjà Vu and Other Musings (a much shorter version of this post went up on the blog later)
• Is the Fed Done Cutting Rates?
• Market Breadth and Sustaining a Rally
• Highs and Lows in the S&P 500 Index

If anyone has any additional questions or comments about the subscriber newsletter, please feel free to email me at bill.luby@gmail.com

Subscriber Newsletter to Launch Sunday 3/29/08

After many requests to provide more details about my thinking vis-à-vis the markets in general and individual stocks in particular, I am launching a subscriber newsletter on Sunday, March 29, 2008. Given the recent market turmoil and the considerable uncertainty about the path forward, this seems like as good a time as any to take this step.

Targeting many subject areas covered by the blog, the newsletter will focus more on market sentiment analysis and technical analysis than on broad macroeconomic issues and stock fundamentals. In truth, my investing approach includes all four elements, but I think the macroeconomic and fundamental aspects of the market are covered quite thoroughly already, whereas good information on TA and particularly market sentiment tend to be much more difficult to find.

I am planning on a minimum of two issues per week, Sunday and Wednesday, as follows:

• The Sunday issue will provide a review of the past week and my thinking on what to watch for in the coming week. I will include my outlook on a variety of asset classes and cover new purchases and sales in three different model portfolios (Aggressive Trader, Growth, and Foreign Growth), as well as a 'stock of the week' pick. I will likely tilt toward technical analysis, charts, and market sentiment analysis, but also cover macroeconomic and fundamental issues.
  
  
• The Wednesday issue will be more of a features-based approach, but will consistently drill down on market sentiment, charts of interest, sectors and industries, and reader questions. Right off the bat, I will be rolling out a two new market sentiment indicators, which I will highlight on Sunday and Wednesday, but will likely get more attention on Wednesday. Whereas the format and content of Sunday's issue will be similar from week to week, Wednesday's issue is meant to be more free-form.
  
  
• In addition to the Sunday and Wednesday issues, there may be occasional special issues as market conditions warrant.
  

Readers can subscribe using the buttons on the upper right hand corner of the blog. Pricing is $30/month (renews automatically) or $300/year (does not renew automatically).

I encourage feedback on any aspect of the newsletter. Feel free to e-mail me at bill.luby@gmail.com.