Frequently Asked Questions

Q: What is stock market timing and why should I use this approach?

A: There is a general belief that the stock market can not be timed, however with enough experience, computing power and empirical evidence a model can be built to look for combinations of events that give clues to future market direction. Our signal history page is testimonial to this.
Timing the market may be beneficial for you if you want to reduce the stress level involved in making seat of the pants, emotionally tainted investment decisions. Making a small number of trades per year that consistently catch 60-80% of each intermediate trend movement, and allowing the power of compounding to make each win work harder, can provide a significant wealth improvement over time - again see our signal history page and look at the compounding section.
With a timing model you don't have to pay for any charting products and you will not have to look at hundreds of charts each day; It is as simple as waiting for an email from INDEXTimer; this frees up your spare time (all you are required to do is look at your email before market open daily to check for any new signal from INDEXTimer), and also saves on brokerage fees as you will only be making a small number (<10) trades per year.

Q: What are the signals and what do they mean?

A: INDEXTimer issues one of the following 3 educational signals:

BUY: This means you should buy the Nasdaq 100 index (most commonly by buying “QQQQ” traded on Nasdaq).
SELL: This means you should sell short the Nasdaq 100 index (most commonly done by shorting “QQQQ” on Nasdaq). If you do not want to or do not have the ability to short, just revert to a cash position until the next BUY signal.
CASH: This means you should recover all your cash from the market by selling any long positions, or buying to cover any short positions. Your position will be zero as a result i.e. you will have all your cash sitting in the broker account ready for the next investment.

Q: What is the QQQQ?

A: QQQQ is the ticker symbol for the Nasdaq-100 Index Tracking stock (exchange traded fund or ETF). A share of QQQQ represents ownership in the 100 companies that are included in the Nasdaq-100 Index. It behaves like an ordinary share except it is not dividend paying.

Q: What is Short-Selling or Shorting?

A: If you believe the stock will fall in value, then Shorting is a packaged combination trade that your broker can offer if you have a margin account; It involves a) borrowing stock from your broker, with an obligation to give that stock back for exactly the same price you borrowed it at (i.e. you have no price risk on this borrow); then selling this stock you have borrowed to the market in anticipation of being able to buy it back later at a cheaper price i.e. when the price has fallen. Of course if the price goes up then the stock is more expensive to repurchase and you would lose money. Shorting is the exact opposite effect of buying stock.

Q: I have just joined - How should I act on your current active signal?

A: Please remember that the signal is for educational purposes only, having considered this

You can either:

1) Follow the current active signal. For example, if a Buy signal has been in effect for some time, you would just buy shares of QQQQ. This is the highest risk proposition as the market may have recently run quite a long way in the direction of the signal and as such may have a higher probability of going against the signal.
2) Average in: For example, if you intend to invest $2,000 to practice market timing with INDEXTimer, you could invest $500 on 4 different days when the market direction is opposite to the signal. This has a medium risk profile.
3) Finally, you could simply wait until the next signal, which of course gives you the lowest risk.

It is up to you to decide which option to choose, based on your tolerance for risk. INDEXTimer recommends you seek advice from a professional financial advisor if you need advice on risk tolerance and distribution of assets.

Q: Your current signal is losing money and I am uncomfortable with this – what shall I do?

A: Wait! Exercise patience and discipline! - Patience pays dividends – refer to the signal history page for the evidence.
To limit the outright risk of any INDEXTimer signal, a Cash signal is automatically issued if the Nasdaq Index moves against our entry point by 10% - at this time we advise just waiting for the next signal before acting again.

Q: How do you generate your timing signals?

A: INDEXTimer uses a model that looks for particular combinations of events that can be mathematically analysed, and empirically have demonstrated very high probability of intermediate trend reversals.

Q: How do I get notified about signal changes?

A: The INDEXTimer web site is updated before market open each day, and will show any change in signal if there has been one.
In order to access the Current Signal page, you need to subscribe to our service (using our “JOIN NOW” option). INDEXTimer also automatically sends a notification e-mail to all active subscribers whenever a signal change occurs, so all you have to do is check your email rather than log on to the site to check for signal changes.

Q: How much does your service cost?

A: Currently the service is free. Please refer to the terms and conditions with respect to potential future charges.

Q: How do I discontinue the service?

A: If at anytime you wish to cancel, simply e-mail us at service@indextimer.com.

Q: Are the INDEXTimer signals and weekly commentary linked?

A: No. The INDEXTimer signals are produced by a mathematical model and not influenced by emotion or personal views.
The weekly commentary from the INDEXTimer analytical team provides an educational comment on how the market behaved in the past week, and how it may behave in the coming days. The commentary may actually predict action that could be in an opposite direction to the existing INDEXTimer signal.

Q: What is the point of the weekly commentary given that it is not linked to the INDEXTimer signal?

A: It's objective is to assist members in learning about market timing on a weekly basis, which is a shorter term time scale than the intermediate trend which the INDEXTimer model focuses on; when looked at in retrospect after a signal change, the commentary should have significant educational value in terms of understanding the culmination of events that combined to cause a signal change.

Q: The system sounds great; shall I use all my savings to practice market timing with INDEXTimer?

A: INDEXTimer does not recommend this. INDEXTimer would advise starting with a low amount whilst practicing market timing. You should seek advice from a professional financial advisor if you are unsure about the way to allocate your financial assets.

The INDEXTimer Team.