As of December 4, 2015, the "Simple Pair Switching" strategy has given a signal to switch allocations from stocks back to bonds. The return for SPY (SPDR S&P 500 ETF) for the previous period is +0.4%, based on the adjusted close prices of November 30, 2015 and December 4, 2015. TLT (iShares 20+ Year Treasury Bond ETF) would've returned -0.5% for the same period.
The signal to switch to bonds occurred when using FDVLX as an equity proxy, but if you use for example, IWS (which the FDVLX is supposed to track) vs. the TLT the signal remains "long stocks". Same for SPY, IWM, or QQQ vs. TLT. FDVLX has been under-performing - don't think that FDVLX a good proxy for equities in the pair switching strategy.
ReplyDeleteRobert