 &TheDowTheory.com |
The Dow Theorist's Sweepstakes |
The Dow Jones Industrial Average is only about 2,000 points above where it
was 10 years ago!
The three major Dow Theorists had been under a BUY signal for many years up until the
SELL signal on August 4th, 1998.
After agreeing on that signal their
interpretations diverged considerably until they came together again
briefly on November 21st, 2007.
The results of the points captured (or lost) by each Dow Theorist
for those 9+ years are shown at that point as
Schannep +4304.21 pts,
Russell -6731.79 pts, and Moroney
-4946.75 pts
At the bottom of this table you will see a tabulation of the
points captured (or lost) by each from 11/21/07 up to the present:
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Each of these Letters are monitored by Hulbert Financial Digest and their performance is verified and charted below:
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During the entire timeframe, Buy & Hold gained only
+1580.70 pts, or
+18.6%.
The distressing results for the other Dow Theorists shown above are an embarrassment
and detracts from the reputation of the
Dow Theory itself. That is one reason I wrote my book, to help reinstate
the Dow Theory to the high status it deserves.
In "Dow Theory for the 21st
Century:
Technical Indicators for Improving Your Investment Results" (published by John Wiley & Sons) I have laid out modern
rules that improve the record of the Dow Theory considerably. My
interpretation uses capitulation, when it occurs, as the time to start buying
into the Dow Theory buy signal which has always followed. After that I
would add to
the position after the bounce, in the pullback phase. Finally,
completion of a Dow Theory buy signal is signaled by the first two of the
Dow Jones Industrials, the Transports, or the S&P500 reaching highs above the
previous bounce. Using this approach throughout the period above would have
improved the results shown above.
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www.TimingIndicator.com
Historical market statistics, while believed accurate, and past performance cannot guarantee future results.
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