Lazy Investing

Lazy investing

The most important thing to me now is, how to stay retired.  I’m done working, and the myth of “do what you love and the money will follow” never really materialized for me.  So I found a profession ( Administrative Assistant) in a laid-back atmosphere, found an organization that paid top dollar for that, kicked back into a nice comfy niche, and stuck with it.

Anyway, saving up for retirement became top priority about 15 years ago.  If I had only figured things out before then, I could have retired at age 37!  Ah well, live and learn. Frugality helped along the way, and more on that later.

It’s too much work to pick individual stocks to invest in.  Us Type B Minuses are too lazy for that.  It’s like trying to find a needle in a haystack, and very time consuming.  If you are risk averse, like me, it seems that whatever stock you pick will go down, immediately.  Boom!  Not wanting to spend much time picking stocks or studying the stock market, I needed a simple system other than buy and hold, which was too volatile for me.  So, I searched for the Holy Grail.  While there is no such thing in reality, I did find a system that worked for me, fit my schedule, and did not take much effort.

Thank you, Mebane Faber.  His simple system of following just five ETFs and putting your money in them when they cross above the 200-day EMA (or 40-week EMA, or 10-month EMA), and getting out of them when they cross below, worked for me.  I added a few more ETFs, as well, and it still works great!  You only need to spend 15-20 minutes a month to decide what to buy or sell and take the appropriate action.  You can either take a glance every month at the Timing Model, or go to a site like Big Charts, click on the Advanced Charts button, and set up the left column like this:

BigChartsSetUp
Setup for Big Charts

First, read Faber’s paper.  A link to it is on the Timing Model page.  There’s also a website that keeps updates on this system, and is updated monthly.  Be sure to read the pitfalls as well.  Scroll down to Table 7 and advance to the last page to see the latest performance.

The five basic ETFs I use are:
SPY
EFA
IEF
RWR
DBC

I also invest in:
IWM
MDY
DIA
EEM
QQQ

And maybe TLT and TIP

I’ll be updating this section monthly, so follow along if you wish.

Disclaimer:  This system will not make you a millionaire overnight, but might help you sleep at night.  Also, I’m not a qualified financial adviser, so proceed at your own risk.

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