COMPOSITE Timing Indicator, The Complete Record

Whenever a 1st Buy signal of any of 1) Capitulation, 2) the Dow Theory for the 21st Century, or 3) the Schannep Timing Indicator (until 10/31/22. Starting 11/1/22 Blay Timing Indicator), buy to 50% invested; if another Indicator gets a finalizing Buy go to fully invested, i.e. add another 50%. If the 2nd Buy is a capitulation or an incremental Buy then add just another 25%, adding the final 25% when another finalized Buy signal occurs. If a Buy is reversed in time by the same type signal then return to the position held excluding that Buy, i.e. if 50%/(25%) was bought then sell that 50%/(25%).

Whenever a 1st Sell Indicator occurs sell 1/2 or 50%, upon a 2nd sell out 100%.

Bold Italicized percentage is 1st Buy or Sell, underlined percentage completes 100%.
Dates shown are dates of signals.  [Here is a tweak for possibly getting better execution prices: ‘Action’ dates can be days later,  most likely is the Schannep Timing Indicator when Monetary component figures are released. In the case of a sell, ‘wait and watch’ if there are intervening ‘obvious’ UP days and hold off to enter the sell order until the first ‘obvious’ DOWN day to execute;  (may require waiting until the last minutes of the trading day). For Buy signals the opposite procedure. Does NOT apply to Capitulation Buys.]

I use equal amounts of Diamonds (DIA), Spiders (SPY), the equal-weighted S&P (RSP) and Nasdaq100 (QQQ, more explanations about including the Nasdaq HERE), so as to participate fully in the market’s advances/declines, however the results shown are from using the Dow Jones Industrial Average only. Results shown include dividends received and interest earned on 3 month Treasuries as received quarterly. Market levels are for the Dow Jones Industrial Average. When Bull/Bear markets become “official” both the DJIA and the S&P500 levels are shown.

The Dow Theory for the 21st Century is used in place of the original/traditional Dow Theory.  As it was only spelled out with the publication of my book in 2008, these results are from backtesting for the most part.  If the rules for this indicator were followed explicitly and had the data been available throughout this timeframe, the results would have been as shown:

NOTE: This is a 13.34% compound annual increase since 12/31/53 to 12/31/23 (70 years) v. a 10.74% gain for Buy & Hold over the same period.

My thanks to Tom Halgren, a subscriber with a sharp eye for detail, for finding numerous typos/errors/mistakes in the previously shown results. He and I believe this/his recalculation is as true and correct as is possible to construct.

The chart below helps you visualize the strong outperformance of the Composite v. Buy and Hold while experiencing significantly smaller drawdowns from the end of 1953 to 2021:

The above performance chart was produced for illustration purposes only based on a hypothetical $10,000 investment amount and should not be used as the basis for making investment decisions. The chart is based on the annual rate of return calculation gross of any fees,

The results following full (100%) BUY signals are:

With the invaluable help of Subscriber Tom Halgren, I constructed the Composite (based on the DJIA total return) starting on 12/29/78. Its signals have been derived from using the DT21C and the Blay Timing Indicator (BTI)

NOTE: This is a 14.77% compound annual increase since 12/28/78 to 12/31/23  v. a 12.09% gain for Buy & Hold over the same period.