FAQs Frequently Asked Questions
Dr K Market Direction Model
What are the strengths of the model?
5 key strengths:
- The model has substantially outperformed the Nasdaq Composite and S&P 500 over every market cycle going back 35+ years. From July 1974 to Mar 2012, returns are +32.55%/yr. The model excels in catching intermediate term trends, whether up or down.
- The model has a self-protection mechanism which keeps its drawdowns to a minimum. This self-protection mechanism results in more false signals but typical losses on a false signal are just -1% to -1.5%. This results in a highly favorable risk/reward ratio, well outperforming the markets in every cycle going back to 1974. Its worst drawdown in its entire 35+ year run was -15.7%. The Nasdaq Composite, by comparison, had a -78.4% drawdown.
- The model buys the fundamentally strongest stocks at pocket pivot points and breakout pivot points when the model signals a buy. Two of our other services, Pocket Pivot Review and Buyable Gap Ups, email you stock suggestions for potentially larger gains since we all want to achieve that brass ring 100% in a year's time if the market allows.
- The model uses 2-times and 3-times ETFs to boost returns.
- The model buys inverse 1-times, 2-times, and 3-times ETFs which are equivalent to going short an index when the model signals a sell.
First published: | 22 Jun 2010 |
Last updated: | 26 Aug 2012 |