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Experiment with and test both the basic and advanced subscription using the trial programs to see how easy to use this stock market software and strategy is by clicking the items below. The programs will load price data from January 2000 forward to two weeks past.
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Investment Timing Software Results
The tables below show how an investor can easily outperform the market averages using an effective stock analysis tool with a timing strategy for stock investing and mutual fund investing. To review the data with comparison charts click here.
As you review the text and figures below, consider them in the context of the market between January 2000 and October 2008. The market went through three phases in this time span.
- Initially there was a very volatile lateral market beginning in January 2000 and extending to October 2000.
- The second phase consisted of a long bear market, October 2000 to August 2002 during which the market lost 47 % of its value.
- Next there was a long bull market during which prices recovered to the previous high and slightly beyond
- Finally there was a bear market, culminating in a very abrupt plunge in October 2008, during which the market lost 42% of its value.
PWA performed very well in all four phases of the market.
- The PWA programs performed exceedingly well in the volatile phase returning a positive 37.5% while the market oscillated within a 150 point range on the S&P 500 and produced no gain.
- During the following bear market PWA returned a positive 54.6% while the market lost 47% of its value.
- PWA also out performed the market during the bull market phase, though not as dramatically—see the comparison charts on our home page—but that’s fine since the market was going the direction we want it to go.
- In 2008, PWA produced a 12% gain while the market lost 42% through October.
- Perhaps most importantly, PWA avoided the market crash entirely.
Results Using the PWA 500 Timer program
This is a back test of the PWA 500 Timer program, the "basic" subscription.
- The PWA 500 Timer is structured to yield fewer trades but capture larger price moves. It is suitable for use with mutual funds that impose limits on how frequently an investor is permitted to switch in and out of the fund.
- The time span covered in the table below is from January 2000 to October 2008.
- Three sets of results are shown, the S&P 500 Index, PWA Timer using a hard and fast rule, and PWA with the user exercising judgment when the price is in a buy or sell band. Loss figures shown in red.
- The S&P figures (column #2) represent the year-by-year value of a buy and hold approach—making the investment purchase and then simply holding it without change.
- The PWA figures in column #3 were arrived at using one rule; buy when the price leaves a buy band, and sell when the price leaves a sell band. The rule is acted upon mechanically with no effort to exercise judgment.
- The PWA figures in column #4 result from putting an element of judgment into play in making buy and sell decisions.
- Judgment is this instance refers taking into account which band the price line is in and the up or down trend of the bands and then choosing a time to implement a buy or sell.
- The "mechanical" rule (two bullet points above) is used as a "last ditch" signal to be acted on only if no earlier judgment was exercised.
- Where more than one number appears in a "year" row, the multiple numbers show dollar growth from one switch cycle (one buy and one sell) to another.
Note: all the table dollar figures are given in "numeric form", meaning without dollar signs, commas, or decimals.
| Year | S&P 500 Index Buy and hold strategy | PWA 500 Timer: Price leaves band Rule | PWA 500 Timer: Exercising judgment |
|---|---|---|---|
|
Starting amount |
10000 | 10000 | 10000 |
| 2000 | 8900 | 11200 | 11400 |
| 12208 | 12654 | ||
| 2001 | 8010 | 13184 | 12907 |
| 14107 | 15101 | ||
| 2002 | 6311 | 14812 | 17668 |
| 20848 | |||
| 2003 | 7687 | 17923 | 28771 |
| 2004 | 8333 | 20612 | 33087 |
| 2005 | 8783 | 22879 | 36726 |
| 2006 | 9820 | 25396 | 42602 |
| 2007 | 10151 | 27681 | 47203 |
| 30034 | 52206 | ||
| 30425 | 54033 | ||
| 2008 | 7280 | 31736 | 57329 |
| % Gain, Total | - 28% | 217% | 473% |
| Trades | none | 14 | 14 |
We can make several observations about the results:
- A buy and hold approach would have yielded a gain of loss of 28% in eight years.
- Even using PWA as a "mechanical" tool with one hard and fast rule, the return on investment was $31,763.00 - much better than buy and hold.
- When we add the element of making judgment decisions, rather than a simple rule that ignores other possibilities, the return improves very significantly to $57,329.00.
Results Using Default Chart Settings:
S&P 500 Index
Data & PWA Online Analyzer
This is a step-by-step back test of the PWA Online Analyzer applied to S&P 500 Index price data with the program's default chart parameters.
- PWA Online is structured with tighter default chart parameters than is the PWA 500 Timer, and will produce more trades with smaller price moves but a higher overall return.
- This program is suitable for use with funds that impose no limit on number of trades, exchange traded funds, common stocks, bonds, and other financial markets.
- In practice, you will be able to control the parameters and you will not be restricted to the S&P 500.
- You will be able to use the program for any market data set you choose.
| Year | Buy | Sell | Points Gain or Loss | % Gain or Loss | Dollar Amount | Annual % Growth |
|---|---|---|---|---|---|---|
| Starting $ | 10000 | |||||
| 2000 | 1333 | 1527 | 194 | 14.6% | 11456 | |
| 1401 | 1461 | 60 | 4.2% | 11942 | ||
| 1378 | 1510 | 132 | 9.6% | 13091 | ||
| 1431 | 1507 | 76 | 5.3% | 13787 | ||
| 1374 | 1432 | 58 | 4.2% | 14369 | ||
| 1265 | 43.3% | |||||
| 2001 | 1366 | 101 | 8.0% | 15520 | ||
| 1118 | 1288 | 171 | 15.3% | 17893 | ||
| 1103 | 1139 | 135 | 13.5% | 20304 | 41.3% | |
| 2002 | 1108 | 1166 | 58 | 5.2% | 21368 | |
| 798 | 941 | 143 | 17.9% | 25203 | ||
| 799 | 935 | 136 | 17.0% | 29495 | 45.3% | |
| 2003 | 835 | 995 | 160 | 19.2% | 35144 | |
| 967 | 1112 | 145 | 15.0% | 40408 | 37.0% | |
| 2004 | 1094 | 1134 | 41 | 3.7% | 41918 | |
| 1065 | 3.7% | |||||
| 2005 | 1219 | 154 | 14.5% | 47786 | ||
| 1146 | 1241 | 95 | 8.3% | 51947 | ||
| 1178 | 1257 | 80 | 6.8% | 55466 | 15.6% | |
| 2006 | 1256 | 1426 | 169 | 13.5% | 62945 | 13.5% |
| 2007 | 1374 | 1550 | 175 | 12.8% | 70980 | |
| 1411 | 1562 | 151 | 10.7% | 78552 | ||
| 1428 | 1476 | 48 | 3.4% | 81194 | 14.4% | |
| 2008 | 1338 | 1367 | 29 | 2.2% | 82980 | |
| 1288 | 1413 | 125 | 9.7% | 91029 | ||
| 1228 | 1282 | 54 | 4.3% | 94943 | ||
| 10/31/08 | 908 |
Results Summary
- There were twenty four and a half switch cycles (one buy and one sell = one cycle) in nearly nine years.
- The dollar gain was $84,943.
- The return was 9.49 times original investment which translates to 849%.
- The returns are dramatically better with a timing investment strategy than if one used a conventional "buy and hold" strategy.
- There were no losing trades in nearly nine years. The PWA stock analysis program returned a profit every trade.
Note: The table above was generated using S&P 500 Index prices. Using other funds, ETF funds, or individual stocks, would have yielded different returns.
Note: these results are "pre-tax" figures, and do not account for brokerage fees.
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