Trades History

Now that all of the 2016 trades have been completed, this is the last time this page will be updated. Below is a recap of how the 2016 trades and all the trades since 1996 have done in comparison to the index fund.

2016 Weekly 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

1/4/16    Utilities         3/14/16  Natural Gas       63.84  70.06   9.7%    0.8%
1/11/16   Utilities         3/14/16  Natural Gas       63.48  70.06  10.4%    5.4%
1/19/16   Money Market      3/7/16   Natural Gas        1.00   1.00   0.0%    6.8%
1/25/16   Money Market      3/7/16   Natural Gas        1.00   1.00   0.0%    7.0%
2/1/16    Energy            3/28/16  Chemicals         33.55  35.69   6.4%    5.5%
2/8/16    Natural Gas       3/28/16  Chemicals         18.05  20.38  12.9%   10.3%
2/16/16   Transportaion     4/4/16   IT Services       71.11  76.81   8.0%    9.3%
2/22/16   Transportaion     4/4/16   IT Services       73.76  76.81   4.1%    6.5%
2/29/16   Comm Equipment    4/18/16  Biotechnology     26.71  27.75   3.9%    8.7%
3/7/16    Natural Gas       6/27/16  Energy Service   20.92*  23.29  11.3%    0.1%
3/14/16   Natural Gas       6/27/16  Energy Service   20.63*  23.29  12.9%   -0.9%
3/21/16   Natural Gas       6/27/16  Energy Service   21.44*  23.29   8.6%   -2.4%
3/28/16   Chemicals         7/5/16   Telecomm         132.63 136.36   2.8%    2.6%
4/4/16    IT Services       5/23/16  Electronics       40.20  40.12  -0.2%   -0.6%
4/11/16   Biotechnology     5/16/16  Utilities        172.59 169.16  -2.0%    1.4%
4/18/16   Biotechnology     6/13/16  Energy Service   178.41 174.67  -2.1%   -0.4%
4/25/16   Natural Gas       6/27/16  Energy Service    23.64  23.29  -1.5%   -4.3%
5/2/16    Natural Gas       6/27/16  Energy Service    24.12  23.29  -3.4%   -4.0%
5/9/16    Energy Service    6/20/16  Utilities         42.01  44.87   6.9%    1.0%
5/16/16   Utilities         8/1/16   Electronics       72.59  76.82   5.8%    4.9%
5/23/16   Semiconductors    11/14/16 Banking           72.88  90.42  24.1%    6.7%
5/31/16   Biotechnology     7/18/16  Transportation   184.39 178.26  -3.3%    3.1%
6/6/16    Biotechnology     7/18/16  Transportation   189.48 178.26  -5.9%    2.5%
6/13/16   Energy Service    7/18/16  Transportation    44.81  45.21   0.9%    3.9%
6/20/16   Utilities         8/1/16   Electronics       74.68  76.82   2.9%    4.4%
6/27/16   Energy Service    8/1/16   Electronics       41.58  42.43   2.0%    8.7%
7/5/16    Telecomm          8/15/16  Natural Resources 70.52  71.88   1.9%    5.1%
7/11/16   Medical Equip     8/29/16  Natural Gas       41.32  43.21   4.6%    2.3%
7/18/16   Transportation    8/22/16  Natural Gas       79.97  79.11  -1.1%    0.9%
7/25/16   Semiconductors    11/14/16 Banking           81.62  90.42  10.8%    0.4%
8/1/16    Semiconductors    11/14/16 Banking           83.42  90.42   8.4%    0.3%
8/8/16    Biotechnology     9/12/16  Banking          190.97 189.12  -1.0%   -1.2%
8/15/16   Natural Resources 9/26/16  Biotechnology     28.99  28.09  -3.1%   -1.8%
8/22/16   Natural Gas       9/26/16  Biotechnology     26.33  25.23  -4.2%   -0.5%
8/29/16   Natural Gas       10/17/16 Energy Service    26.32  26.78   1.7%   -2.2%
9/6/16    Banking           1/30/17  Chemicals        25.58*  32.59  27.4%    4.5%
9/12/16   Banking           1/30/17  Chemicals        25.68*  32.59  26.9%    5.8%
9/19/16   Biotechnology     10/24/16 Energy Service   193.48 174.96  -9.6%    0.7%
9/26/16   Biotechnology     10/31/16 Utilities        195.29 167.62 -14.2%   -0.8%
10/3/16   Semiconductors    11/14/16 Banking           92.00  90.42  -1.7%    0.4%
10/10/16  Energy Service    11/28/16 Banking           49.65  49.53  -0.2%    2.0%
10/17/16  Energy Service    11/28/16 Banking           48.34  49.53   2.5%    3.8%
10/24/16  Energy Service    11/28/16 Banking           49.25  49.53   0.6%    2.6%
10/31/16  Utilities         12/5/16  Energy Service    74.13  68.65  -7.4%    4.0%
11/7/16   Air Transport     1/9/17   Energy Service   67.16*  74.58  11.0%    6.2%
11/14/16  Banking           1/30/17  Chemicals        29.79*  32.59   9.4%    5.2%
11/21/16  Biotechnology     12/27/16 Semiconductors   193.61 178.57  -7.8%    2.8%
11/28/16  Banking           1/30/17  Chemicals        29.90*  32.59   9.0%    3.3%
12/5/16   Energy Service    2/6/17   Chemicals         54.21  56.50   4.2%    3.6%
12/12/16  Energy Service    2/6/17   Chemicals         55.86  56.50   1.1%    1.0%
12/19/16  Energy Service    2/6/17   Chemicals         55.28  56.50   2.2%    0.9%
12/27/16  Semiconductors    2/6/17   Chemicals         98.30  98.79   0.5%    1.2%

Money market is assumed not to earn any interest.

Note: Fidelity has changed the name of Select Electronics to Select Semiconductors.
The ticker symbol remains the same, FSELX.

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 1/4/16, the closest Monday to the start of 2016, 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
--------------------------------------------------------------------
1/4/16    Utilities         3/14/16  Natural Gas        9.7%    0.8%
3/14/16   Natural Gas       6/27/16  Energy Service    12.9%   -0.9%
6/27/16   Energy Service    8/1/16   Semiconductors     2.0%    8.7%
8/1/16    Semiconductors    11/14/16 Banking            8.4%    0.3%
11/14/16  Banking           Still held as of 1/3/17     9.0%    4.0%
---------------------------------------------------------------------
Total return as of 1/3/17                              49.3%   13.3%
    accounting for maximum 2% annual management fee    47.3%

The calculation for the total return for the track is:
 (1.097)(1.129)(1.020)(1.084)(1.090) - 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%       2013 Weekly Trade List
2014           10.4%           15.3%       2014 Weekly Trade List
2015          -16.1%            1.2%       2015 Weekly Trade List
2016           47.3%           13.3%
              ------          ------
Average(96-16) 16.7%            9.9%

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 3, 2017 The track for 2016 is now completed. It was outstanding, the third best in the 21 year history. Typically there are 5-7 trades in each year's track. Although the last trade is still open, we can consider it as a fifth trade since it has been held for more than the five week minimum. All five of the trades were profitable, and, except for the third one, they did much better than the index fund over the same periods.

No more weekly trades will be shown. Since 2017 will be my last year as a registered investment advisor and I am no longer accepting new clients, I am not going to continue showing the weekly trades. I will also not update the track shown above since it shows how the system trading one fund at a time did last year. I will continue to have weekly updates of the results of the trades open at the end of 2016. When Banking is sold, you will be able to "complete" the track should you wish.

Since I am no longer taking clients and have not traded the Selects for any current ones for several years, I am willing to completely disclose the system's parameters to anyone who requests them. You likely can find them from online or other sources, but I have seen several that claim to reveal my system that are not accurate. If you really want to know for sure, please e-mail me: feedback--ATsign--pankin.com. [Use @ instead of --ATsign--]. Feel free to discuss any other issues or questions you have about trading and investing.

In December Fidelity effectively eliminated the 0.75% charge for selling a Select fund other than money market before it had been owned for 30 days. Some of the funds had the fee eliminated and others are having it waived. That may indicate that the charge could be imposed again for the ones with the waivers if Fidelity determines that there has been too much short-term trading. Fidelity's frequent trading rules will still apply, and those can result in having severe restrictions on trading all Fidelity funds. I haven't decided if I will researach methods for trading the Selects without worrying about the short-term charge, which the five week minium holding period avoids.

February 6, 2017 All of the trades that began in 2016 have now been completed, so this is the last update to this page. For 2016, the system trades had an average gain of 3.6% while the index fund over the same periods averaged a gain of 2.6%. Since the start of the tracking on this page in 1996, which was the first full year that the current parameters were used, there have been 1095 weekly trades. (That is three more than 52 per year due to the Monday to Monday tracking based on the closest Monday to the start of each year resulting in three years with an extra week.) The average of the weekly system trades over the 21 years was also a gain of 3.6%, and the corresponding average for the index fund was up 1.4%.

While it is not unusual for a system trade to perform worse than the index fund over the corresponding period, those times when a sector fund makes an exceptional move are likely to provide superior investment returns over time to buying and holding the index fund. Like all investing methods, following the system requires a combination of patience and discipline.

I hope that those of you who have followed this page have found it at least entertaining and, even better, educational. Please feel free to ask questions or send me your comments at feedback --AT sign (use @)-- pankin.com.

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