HISTORICAL PERFORMANCE RESULTS

2012: +25% vs. S&P 500 +13% 

2011: +7% vs. S&P 500 +0%

2010: +42% vs. S&P 500 +13%

2009: +49% vs. S&P 500 +23%

2008: +5% vs. S&P 500 -38%

2007: +20% vs. S&P 500 +4%

We ended 2012 with a 25% return, beating the S&P again for another year.  That was the last year we needed to confirm that everything works pretty much as stated.  There are great days, and there are not so great days when trading this system, but for the most part the theory is sound: "match or beat the S&P in bullish times and in bearish times either earn or at least not lose anything."

I spent the last week recovering from the flu.  It was a terrible experience as I had never had the flu before.  I now understand how it can be so devastating as it sapped my strength and sleep for nearly 5 days, and I am just now recovering--so with that said, I have lost some time in getting everything going, and I apologize for that, but I really was not able to move a whole lot! 

So, lets pick up where we left off last.  I will be reaching out to those that have requested to open an account with specific instructions over the next 2-4 weeks.  We are supplementing the TradeStation instructions as there is a non-trivial amount of paperwork to be filled out when opening a futures account with TradeStation. 

I would like to state that when opening an account for the first time it can seem like an enormous amount of things to agree to and sign, but these are all required by TradeStation for regulatory purposes--don't worry if you make a mistake, we will make sure everything gets processed correctly.

I hope everyone had a great start to the new year and I look forward to speaking with everyone in the next few weeks.

 For those that have been reading, we predicted a 1350 target in the S&P500.  We were off by about 70 points but pretty close in the last week before a monster rally on expectations of a fiscal cliff resolution moved the market from 1380 to 1420 in a couple days. 

For 2013, we expect the S&P 500 market to settle at 1525.  That is roughly a 7% return.  There are a number of reasons for this, but the single most reason is this market has been climbing on mere speculation of more QE and then moving on announcements with little sell-off after the fact. 

Corporate profits are healthy and stock prices (from what we can see) are fairly priced.  QE is still running, and the presidential race is over, and Europe is rather quiet and when there are issues, central banks throw everything at it.  However, this may be a year in which the U.S. may start "thinking" about letting QE end, letting interest rates rise a little, and start thinking about how to get 4 trillion off the FEDs books. 

For the most part, treasuries and practically everything else with a coupon has been unattractive, pushing virtually everyone into the stock market.  If interest rates start to rise, or there is a speculation they may, on-the-run treasuries become more attractive.

For this alone, both a speculation of less QE and fairly priced assets, we feel the market may test 2007 highs, but come up short in the end.  We also feel there is one major leg down this year but for the most part, this market closes only 7% higher.  This is all speculation of course.