2013Weekly Trades

All distributions and dividends are assumed to be reinvested, which has no meaningful effect on the rates and percentages shown. For comparison, the same period returns of the Vanguard Index 500 Fund (symbol VFINX), whose performance is close to the S&P 500 index, are also shown.

It should not be assumed that trades in the future following the Fidelity Select Switching System will be profitable or will equal the performance of the trades shown below.

Note: Buy prices marked by a * have been adjusted for a distribution by the
      fund between the purchase and sale dates.  This distribution is assumed
      to be reinvested in the fund, which has no meaningful effect on the
      percent changes or overall rates of return shown. Fidelity normally
      makes any distributions for the Selects on the first two Fridays in
      April and on the first three Fridays in December.
                                                            Sell or          Index
Buy       Fund              Sale/Exchange              Buy   Recent  Percent  500
Date      Purchased         Date     Exchange to:      Price Price   Change   Change

1/7/13    Automotive        2/19/13  Electronics       39.82  41.45   4.1%    5.0%
1/14/13   Biotechnology     2/19/13  Electronics      118.50 119.16   0.6%    4.3%
1/22/13   Energy Service    3/11/13  Biotechnology     72.64  74.03   1.9%    4.6%
1/28/13   Energy Service    3/11/13  Biotechnology     74.00  74.03   0.0%    4.1%
2/4/13    Energy Service    3/11/13  Biotechnology     74.66  74.03  -0.8%    4.3%
2/11/13   Energy Service    3/18/13  Biotechnology     74.48  74.29  -0.3%    2.6%
2/19/13   Electronics       3/25/13  Air Transport     50.86  50.44  -0.8%    1.1%
2/25/13   Transportation    4/8/13   Utilities         56.45  59.51   5.4%    4.8%
3/4/13    Biotechnology     6/10/13  Computers       123.62* 145.48  17.7%    8.3%
3/11/13   Biotechnology     6/10/13  Computers       128.67* 145.48  13.1%    6.1%
3/18/13   Biotechnology     6/10/13  Computers       127.15* 145.48  14.4%    6.3%
3/25/13   Air Transport     4/29/13  Biotechnology    46.44*  46.58   0.3%    4.4%
4/1/13    Utilities         5/13/13  Electronics       64.64  65.24   0.9%    4.8%
4/8/13    Utilities         5/13/13  Electronics       65.70  65.24  -0.7%    4.1%
4/15/13   Biotechnology     6/10/13  Computers        135.52 145.48   7.3%    6.2%
4/22/13   Biotechnology     6/10/13  Computers        144.29 145.48   0.8%    5.5%
4/29/13   Biotechnology     6/10/13  Computers        141.51 145.48   2.8%    3.4%
5/6/13    Broker & Invest   6/24/13  Medical Delivery  60.49  58.63  -3.1%   -2.4%
5/13/13   Electronics       7/15/13  Biotechnology     52.48  56.16   7.0%    3.4%
5/20/13   Broker & Invest   6/24/13  Medical Delivery  63.70  58.63  -8.0%   -5.4%
5/28/13   Banking           8/26/13  Software          22.58  24.17   7.0%    0.3%
6/3/13    Computers         7/8/2013 Banking           66.04  65.21  -1.3%    0.2%
6/10/13   Computers         7/15/13  Biotechnology     65.93  67.38   2.2%    2.6%
6/17/13   Communications Eq 7/29/13  Biotechnology     25.78  26.63   3.3%    3.0%
6/24/13   Medical Delivery  8/5/13   Air Transport     64.44  69.55   7.9%    8.1%
7/1/13    Banking           8/26/13  Software          22.67  24.17   6.6%    2.9%
7/8/13    Banking           8/26/13  Software          23.82  24.17   1.5%    1.2%
7/15/13   Biotechnology     10/21/13 Energy Service   162.16 169.40   4.5%    4.2%
7/22/13   Biotechnology     10/21/13 Energy Service   164.51 169.40   3.0%    3.4%
7/29/13   Biotechnology     10/21/13 Energy Service   162.61 169.40   4.2%    4.0%
8/5/13    Air Transport     9/9/13   Biotechnology     51.69  50.36  -2.6%   -1.3%
8/12/13   Software          10/21/13 Energy Service   103.94 112.31   8.1%    3.6%
8/19/13   Computers         9/23/13  Air Transport     68.62  68.18  -0.6%    3.3%
8/26/13   Software          10/21/13 Energy Service   103.62 112.31   8.4%    5.6%
9/3/13    Money Market      10/7/13  Retailing          1.00   1.00   0.0%    2.4%
9/9/13    Biotechnology     10/21/13 Energy Service   171.92 169.40  -1.5%    4.6%
9/16/13   Biotechnology     10/21/13 Energy Service   172.31 169.40  -1.7%    2.9%
9/23/13   Air Transport     12/30/13 Industrials      52.01*  59.00  13.4%    9.0%
9/30/13   Air Transport     12/30/13 Industrials      51.72*  59.00  14.1%   10.0%
10/7/13   Retailing         11/25/13 Pharmaceuticals   80.89  87.84   8.1%    7.8%
10/14/13  Medical Delivery  11/25/13 Pharmaceuticals   71.37  75.07   5.2%    5.6%
10/21/13  Energy Service    11/25/13 Pharmaceuticals   87.60  85.05  -2.9%    3.5%
10/28/13  Air Transport     12/30/13 Industrials      55.60*  59.00   6.1%    4.9%
11/4/13   Air Transport     12/30/13 Industrials      56.69*  59.00   4.1%    4.5%
11/11/13  Air Transport     12/30/13 Industrials      56.52*  59.00   4.4%    4.2%
11/18/13  Medical Delivery  12/30/13 Industrials      70.19*  72.71   3.6%    3.0%
11/25/13  Pharmaceuticals   12/30/13 Industrials      18.79*  19.16   2.0%    2.3%
12/2/13   Biotechnology     3/17/14  Banking          179.87* 213.51 18.7%    3.8%
12/9/13   Biotechnology     3/17/14  Banking          178.22  213.51 19.8%    3.3%
12/16/13  Software          2/18/14  Electronics      113.10* 122.80  8.6%    3.4%
12/23/13  Industrials       2/18/14  Electronics       33.24  33.13  -0.3%    1.0%
12/30/13  Industrials       2/18/14  Electronics       33.54  33.13  -1.2%    0.2%


Money Market fund assumed not to earn any interest
In order to keep this complicated page from becoming even more so, the trade results shown do NOT include the use of "stop-loss" tactics, which is my recommended strategy. These are discussed in several other pages on this site, and there are some examples that illustrate the potential beneficial effects of using stop-losses. The more volatile sector funds such as those in high technology, Biotechnology, and Energy Service are more likely to get stopped out. In many such cases, the fund likely would have been held less than 30 days. If so, it would have been hit with Fidelity's 0.75% short-term selling penalty for Select funds.

Since it is unlikely that any investor would act on all of the weekly signals shown above and on the linked pages for prior years, here is an illustration of one use of the weekly trade list tables.

Starting on 12/31/12, the closest Monday to the start of 2013, if one had invested
into a single Select fund and followed the system, these would be the trades:

Buy       Fund              Sale/Exchange            Percent  Index 500
Date      Purchased         Date     Exchange to:    Change   Change
--------------------------------------------------------------------
12/31/12  Automotive        2/19/13  Electronics        6.2%    7.6%
2/19/13   Electronics       3/25/13  Air Transport     -0.8%    1.1%
3/25/13   Air Transport     4/29/13  Biotechnology      0.3%    4.4%
4/29/13   Biotechnology     6/10/13  Computers          2.8%    3.4%
6/10/13   Computers         7/15/13  Biotechnology      2.2%    2.6%
7/15/13   Biotechnology     10/21/13 Energy Service     4.5%    4.2%
10/21/13  Energy Service    11/25/13 Pharmaceuticals   -2.9%    3.5%
11/25/13  Pharmaceuticals   12/30/13 Industrials        2.0%    1.3%
--------------------------------------------------------------------
Total return as of 1/6/14                              17.2%   31.7%
    accounting for maximum 2% annual management fee    15.2%

The calculation for the total return for the track is:
 (1.062)(0.992)(1.003)(1.028)(1.022)(1.045)(0.971)(1.020) - 1  expressed as a percent.
Here is a table showing what have happened if one had followed the method illustrated above starting on the closest "Monday" to the beginning of each year since 1996. The returns shown are those for the following year (52 weeks). "Selects System" shows the results of trading the Select funds, which have been reduced by the maximum 2% annual management fee. Those returns do not reflect Fidelity's load (removed in September 2003) applied to initial purchases of Select funds, which ranged from 0% to 3% depending on the amount of the purchase. The links in the right column show the weekly trades for each year and the computations of the values in the table. Returns for the Vanguard Index 500 fund are included to provide a market condition context.
Year      Selects System    Index 500      Weekly Trade Lists & Computations

1996           31.2%           21.9%       1996 Weekly Trade List
1997           33.1%           28.6%       1997 Weekly Trade List
1998           17.1%           27.7%       1998 Weekly Trade List
1999           56.4%           19.6%       1999 Weekly Trade List
2000           32.0%          -10.8%       2000 Weekly Trade List
2001          -20.5%          - 9.5%       2001 Weekly Trade List
2002          -23.8%          -21.3%       2002 Weekly Trade List
2003           18.4%           28.2%       2003 Weekly Trade List
2004           14.7%            8.8%       2004 Weekly Trade List
2005           12.5%            7.4%       2005 Weekly Trade List
2006           12.8%           13.6%       2006 Weekly Trade List
2007           11.2%            6.9%       2007 Weekly Trade List
2008          -42.4%          -38.4%       2008 Weekly Trade List
2009           90.5%           32.9%       2009 Weekly Trade List
2010           31.4%           12.9%       2010 Weekly Trade List
2011            7.6%            2.4%       2011 Weekly Trade List
2012           11.6%           13.1%       2012 Weekly Trade List
2013           15.2%           31.7%
              ------          ------
Average(96-13) 17.2%            9.8%

No claim is made that the system will perform in the future as it has in the past or as illustrated above. Also, there can be no assurances that the system will produce a profit in the future; it is possible that the system will produce losses.

Comments and Implementation Issues

(Past comments may be deleted when they are no longer relevant)

January 28, 2013:

Two Select funds are signaled for sales this week. If an investor owns both of them as part of more diversified holdings than just a single Select fund, then exchanging both of them into Energy Service would defeat that purpose. There are a couple of ways to deal with this situation, which happens a few times each year. One is to exchange either of the two funds into this week's top-ranked one, Energy Service, and the other fund into the Money Market fund. When a fund not in the energy sector rises to the top of the rankings, the money fund can be exchanged into that fund. If the investor does not want to be less than fully invested now, then one fund could be exchanged into the highest ranked fund not in the energy sector. This week, that would be the second ranked fund, Medical Equiqpment.

December 30, 2013:

We have now completed "2013" (the 52 weeks from 12/31/12 to 12/30/13), so we can see how the system did for the year. In most years there are five to seven trades, but in 2013 as in 2012, we saw more. In 2013 there were eight completed trades.

Only two of the eight trades did better than the broad market as represented by the Vanguard index fund over the period of the trade, and the higher margins for those two were quite small. Moreover, two of the trades in the track lost money while the index fund gained over all eight of the trade intervals.

The track gained a very healthy 17.2% for the 52-week period, but that was well below the gain in the index fund of 31.7% over the period. The trades in the track starting on 12/31/12 just never caught some of the very good ones last year. The system taken as a whole, but not that track, did better than the index fund in 2013. There were 55 trades that ended in 2013, including one in the money market fund and 30 of those saw the Select fund return more than the index fund over the period of the trade. The average difference of the sector fund trades, including the money fund, and the index was 0.7%. That means the track shown above was "unlucky."

Since December 30, 2013 is the closest Monday to the start of 2014, the track for the new year starts with Industrials being purchased now. The 2013 track is completed since Pharmaceuticals was sold this week. The new track, which will consist of a single trade for at least the next five weeks, will be shown starting next week.

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