This is further illustrated when we see comparative five-year price charts for the S&P 500 as illustrated by SPDR S&P 500 ETF (SPY) and the stocks that make up the Dow Jones U.S. Select Dividend Index (DVY).
SPY data by YCharts
Sjuggerud pointed out that when buying investments at new highs many investors "feels risky." But when it comes to the broader markets, "...history shows you'll do better than average. Or you might want to "catch a falling knife" and buy when stocks are at new lows. But if you do, realize you are fighting against more than 220 years of historical precedent."
Instead of fighting these facts he encourages us to embrace them.
You may remember the old bromide when it comes to investing that "the trend is your friend." I asked both Sjuggerud and Smith whether that is really true and also about some of the latest finding of the "System" they've developed. "Over the past few months, we've focused our research on one of the most important -- yet difficult to analyze -- tools in investing. We've concluded and results show the "trend" is the most important tool for making investment decisions. "Based on history, finding the trend and sticking with it has been the best way to make money. And the trend is easy to quantify. Our "True Wealth Systems" databases are some of the best in the world. And we have decades' worth of data to determine when a stock or sector is in an uptrend." They went on to discuss how to determine "value" in relation to the trend. "We also have plenty of data for determining value. Our databases give us just about any value measure we would need. History shows that buying a cheap country or sector when it's in an uptrend is almost always a good idea. Jim Cramer and Stephanie Link actively manage a real money portfolio for his charitable trust- enjoy advance notice of every trade, full access to the portfolio, and deep coverage of the latest economic events and market movements. After recently having purchased shares of Newmont Mining (NEM) and Barrick Gold (ABX) I swallowed hard, wishing I had utilized this system of theirs before making my investment decision.
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