Thursday, June 18, 2009

Moving Average ETF Trading Strategy Update for Week Ending 6-12-09

Investor B checked out the moving averages for each of the 10 ETFs in the balanced ETF portfolio. There is finally a change based on last week's market performance. Investor B is still long in the iShares Barclays Aggregate Bond (AGG) and the iShares Barclays 1-3 Year Credit Bond (CSJ). But now the Vanguard Emerging Markets Stock ETF (VWO) has had the 50 day moving average cross above the 200 day moving average indicating a buy signal.

Based on the balanced portfolio, 5% or about $500 will be invested in this ETF. The close on Monday, June 15 was $31.78 so Investor B will buy 16 shares ($508.48). So in the last 15 weeks, 3 ETFs from the portfolio have indicated buy.

Background: Investor B is using a 50 day/200 day exponential moving average trading strategy where when the 50 day moving average is above the 200 day, that is a bullish or buy signal. When the 50 day moving average is below the 200 day moving average, that is a sell/bearish signal. The balanced ETF portfolio can be viewed here as well as a more detailed explanation of the ETF investing strategies of Investor A (Buy and Hold) and Investor B.

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