For most of our Fidelity IRA and brokerage accounts, our investment strategy will involve taking a roughly 12% position in our most attractive ETFs (or mutual funds) and/or a roughly 6% position in "thematic" ETFs that act as proxies for the largest stock holdings in upward momentum "industry" groups.
As far as performance results for our above described investment strategy, extensive back testing shows that our established buy signals described above have verified very positive historical growth results over many past years.
The actual verified performance results has shown an 80-85% success rate over the 8-32 weeks following the investment buy signal trigger.
After the typical 8-32 week upward trending performance period, if the price of the investment is also hitting its own historic price highs, we will generally see a short pullback, or "consolidation" period, followed by a price continuation higher.
In most cases, we will hold the investment(s) through the normal "correction" period and stick with said investment until we see the upward trend run out of steam, usually confirmed by a high volume of money flow out of an investment holding.
However, to ensure consistent long-term investment profitability, our investment strategy will require some degree of short-term investment rotation if any of our owned investments "falter" sooner than expected.
To minimize potential losses, all our investments will be kept on a tight leash, if for some reason any portion of our investments do not continue their upward trajectory.
In other words, we will watch closely for our predicted sustained long-term upward trend, hold those investments until the uptrend reverses, then, when appropriate, liquidate non-performing investments.
A practical shift in "new decade" investment choices
Many of you probably consider our investment service to be focused primarily (or wholly) on the stock markets. Although historically true, this asset selection assumption will be tempered going forward.
Due to the increasing political economic dysfunction we are seeing globally - but especially domestically, it is incumbent upon our investment service to manage your money with intelligent and sensible risk-aversion.
Plus, while we will certainly use the most commonly recognized investment vehicles - which will include ETFs and traditional mutual funds, we may also move more toward individual bonds and "ETN's" that track the "price" of various commodities such as gold, silver, or even lithium used in electric car battery production. We will invest in the stocks of dirty energy or environmentally destructive mining companies.
To be both successfully profitable and risk-averse, our investment strategy cannot favor any one ETF / fund, investment asset class, sector, industry, or commodity. Individual stock selection is more complex, which will be covered at a later time.
We will, though, focus our investing in high visibility investments that are in sustainable uptrends and endowed with high trading volume (I.e. liquidity) that appears attractive as a suitable investment for our specific risk tolerance.
After the pandemic 1st wave in April of 2020, US stocks were the global investment asset of choice for the most successful investors. In 2021, we will continue to follow that trend only as long as it continues its positive money flow uptrend.
In other words, we will watch closely for any global investment trend changes by tracking large investor money flows - both in and out of closely followed investment classes, sectors, or world regions.
Fortunately, our reliable money management strategy described above will tell us what those big investor money flow changes will be - as they unfold.
Financial Media "Noise"
It is important to understand that the investment "noise" we regularly see or read in the financial media is based almost solely on daily performance trends, economic projection marketing, and investment firm sales pitches.
These financial media "touts" have very little idea what is going to happen in one month or longer with the economy or investments in general. Their advice may sound good short-term, but they do not en masse successfully identify longer term investment trends (except when we are already experiencing a long-term bull market in stocks).
In fact, like television and cable news in general, so much of the financial media only exists to sell advertising to naive retail investors - or those viewers "gullible" to financial celebrity idolatry.
Of course, there are some investments trends that one can key on for valid information, such as the Federal Reserve Board's current monetary and interest rate policy - or other identifiable investment sentiment indicators such as a volatile dollar or shifts in inflation.
As such, it is my professional responsibility to as early as possible identify, track, and invest where the big Wall Street money managers are investing for their own institutional accounts.
Finally, I understand that my primary job is to grow and protect your financial nest egg so you can enjoy and live comfortably in your retirement - and sleep well without worrying about your money.
Be safe and be wise. And wear a mask until we all get our vaccinations for this Covid-19 nightmare.