Using stock market technical analysis for funds

Safe investing with an investment software program that is based on stock market technical analysis offers many advantages.  These advantages apply equally to investing in ETF’s and mutual funds.

Once you have your groups, the universes of symbols from which you will invest, the next step is to use investment analysis software that enables you to find the best future performers within each group.

Technical analysis for funds or stocks, or ETF’s performance as compared to the markets as a whole is the method I use.  You also need to set some rules for when to sell and when to hold the mutual fund, because failing to sell when you should will only generate losses in your portfolio/pocketbook.

Technical analysis removes all the emotional and subjective aspects from your decisions.  This method can be based on many means of analyzing a mutual funds price performance.  You can do it with a spreadsheet if you have lots of time, but investment software programs are faster and more effective.  Personal investment software can tell you things like what fund is likely to be the best performer and whether your current holdings are continuing to grow.


It is always important to remember those factors that are unique to mutual funds:

  1. Minimum holding requirements once you buy a funKeys to successd
  2. Short-term penalty fee if you sell too soon
  3. The possibility of a frozen account if you re-buy a recently sold fund or funds too often within 12-months timeframe.

In other words either you or your investment software must track your funds and base selling and buying decisions on how long you have owned a fund with a “re-buy” restriction on recently sold funds.  Taking that simple precaution will ensure that you don’t get caught up in the round-trip trap.

One way to circumvent the round-trip trap is to buy a similar fund from a different mutual fund family instead of buying back the same fund.  In other words, if just sold ABC mutual fund but now notice it’s on the rebound, resist the urge to buy ABC back, but buy XYZ instead.

Trading strategies for each mutual fund group will be different.  One group may offer a minimum hold of 30 days, while another may require 90 days.  A dividend group may trade very infrequently, while a sector group may trade more often because of changes in the economy.

You may, as I have, use two or even three different strategies for the same group of mutual funds; one based on more frequent trading than the other.  The key is to form your groups, settle on a method for making your buy-sell decisions, and then to stick with your method, the buy-sell rules and recommendations generated by your investment managment software.

The important thing to remember is that if your time is limited for managing your investment account, and you want to grow your wealth with a method that is safe, then look into mutual funds; it is one method that can provide excellent results.

Book: Invest Safely and Profitably Investing Made Easy – Your road map for safe profitable investing in less than 30 minutes a week.  By Raymond M.F. Dominick

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