Sunday Musings: Hedge Q & As

Yesterday’s post about my new e-book “The SimpleHedge Strategy” prompted a lot of inquires. Reader Dick had this to say:

Thanks for sharing the Hedging e-Booklet. I think the approach is brilliant, and just whatI needed. I have a question though: You talk of a short-term trend line, but I don’t see itbeing replicated, either at your blog or the Trend Tracker site.

Am I missing something? If it isn’t being currently shown, then my obvious suggestion is that you begin to show it atone/both sites. Another suggestion would be to add a subsection called “hedging” to your other categories that you display (i.e., Domestic Funds, ETFs, Sectors, etc.).

That’s the exact plan. Things were a bit hectic leading up to the completion of this e-book, so I neglected to mention the upcoming additions to the weekly commentary and StatSheet.

First, the weekly update, which now features the positions of the domestic and international Trend Tracking Indexes (TTIs), will as of next week also show the position of the (short-term) Hedge Trend line. This will look as follows and is based on last Friday’s close:

Domestic TTI: -12.28%
International TTI: -20.89%
Hedge TTI: -5.40%

Second, whenever I display a chart of the domestic TTI, it will feature the long-term trend line (red) and the short-term trend line (blue) just as shown in the e-book.

Third, starting with next Thursday’s StatSheet, I will add a section titled “The SimpleHedge,” which will show the latest update on the active position, which I have featured in the book, so you can see how it plays out.

As shown above, the Hedge TTI is currently in negative territory by -5.40%. That means I will hold my existing hedge subject to my sell stop, but will not add any new ones until the short-term trend line has been crossed to the upside.

About Ulli Niemann

Ulli Niemann is the publisher of "The ETF Bully" and is a Registered Investment Advisor. Learn more
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