Holding Period of Long Term Timing Portfolios
Our previous newsletter April 24, 2017: The Long Term Stock Market Timing Return Since 1871 generated some questions from our users. Specifically, some users are wondering whether using a timing strategy such as the 10 month moving average mentioned in the article can now reduce the required hold time to achieve a long term average return. We believe this is an extremely important question and want our readers to understand clearly on this concept.
Rolling period returns
Recall that in that newsletter, we show using the timing strategy not only improves the long term average return slightly, but it dramatically reduces volatility of the portfolio. We further look at how fluctuated the moving average rolling period returns are using the following table:
|S&P Rolling 10 Yr||S&P Rolling 15 Yr||S&P Rolling 20 Yr||MA Rolling 10 Yr||MA Rolling 15 Yr||MA Rolling 20 Yr|
MA: Moving Average
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