Today's Market
by Dr Invest

Do not read any further until you have read the previous blog. At the first of May is a favorable time to invest in BONDS. We have chosen two ETFs that could produce a return of 5% to 7% for the remainder of the year. We are using a method called the "Ivy Portfolio" to guage whether the price of the ETF is above the 10 month Simple Moving Average. We only buy once a month (at the first of the month) and only if the price remains above the 10 month SMA. When the price dips below the 10 month SMA, we sell the ETF. I am using BND and TIP as the favored ETFs.

Review the previous day's blog to see how a $10,000 portfolio is divided up and how the investment into EFTs is made in three tiers over a three month period.  Today, I want to show how to use OptionsHouse to make this investment. (Remember, OptionsHouse is constantly changing and you will need to contact OptionsHouse for the proper instructions on the use of their trading platform.)

Selecting ORDER TICKET at the bottom left is the way to begin a trade.

After you open the ORDER TICKET, select STOCK TICKET and proceed to the opening window.

At the top left, enter the symbol...in this case BND. Take the ASK PRICE and divide into the amount you want to invest. In this case, we are investing 1/3 of $10,000. $3,333 is the amount set aside for investment in to BOND FUNDS. (read the previous blog.) Cutting to the chase, $555 is invested into BND and $555 is invested into TIP. Using a calculator, divide the ASK PRICE of $83.99 into $555 to determine the QUANTITY OF SHARES to BUY. Under ACTION select BUY. Since this is a simple BUY, select the PRICE as LIMIT and enter the ASK PRICE in the window to the RIGHT of the label LIMIT. Since you are buying immediately, DAY is fine for the DURATION. As you see below, the amount that you are spending is calculated for you, showing you the amount of your investment.

To complete the trade, select PREVIEW on the bottom RIGHT.

Make sure, make sure, be certain, that ALL and I mean ALL the numbers are correct. Especially pay attention to the PRICE you are offering for the stock. How shocking, when you find out you acidently paid $600 per share for a stock and the price was only $60 per share. When you strike the button PLACE ORDER, you are stuck with the all the terms you agreed to on the Stock Ticket.

You will see that your newly acquired stock shows up in the STOCK DETAILS, ORDERS, and POSITIONS on the start page.

That's it! Place another order for TIP and then wait a month. If the price remains above the 10 month SMA. Buy BND and TIP again at the first of JUNE. If the price remains above the 10 month SMA for another month, then at the first of JULY make your last purchase of BND and TIP and hold until the PRICE of either BND or TIP moves below the 10 month SMA.

To learn more about how to set up the charts for BND and TIP with a 10 month SMA go to the sidebar selecting MODEL ETF PORTFOLIO. At the end of that blog, you will see the PROFOLIO PDF. Open it and read how to setup your charts for the 10 month SMA in YAHOO.

If you have questions, feel free to contact me at DRINVEST@mail.com.

(note: the above information is for entertainment purposes only and not to be used for investment advice.)