Tracking Home Price Trends with S&P/Case-Shiller

The S&P/Case-Shiller Home Price Indices keep track of home prices in 20 major metropolitan areas. Data go back as far as 20 years for some markets.


I wanted to compare a couple of markets, one that is experiencing a bubble and one that isn’t. Los Angeles is a good example of a bubble while Atlanta shows no bubble whatsoever.



By placing a 10-year moving average on the charts, you can see how far prices in Los Angeles have moved from the average. For the past year and a half or so, prices have started to decrease, forming a clear downtrend. Because of this I would not be a buyer in the Los Angeles market. Granted, some neighborhood in Los Angeles might still be doing ok. But overall it is not an attractive market yet, not until prices have bottomed out and resumed an upward trend.



Atlanta home prices on the contrary are keeping steady with their 10-year moving average. The trend has been up for as far as the data go (January 91). For this reason I would consider being a buyer in the Atlanta market, but a cautious buyer. Considering that home price trends can differ greatly from one neighborhood to the next, I would check whether or not the neighborhood has experienced a healthy, unbubbly growth over the past 10 years.

Does anyone know any website with reliable historic home price data at the neighborhood level?

Company Health Insurance Costs up 50%

It was a long time coming. After many years of very affordable health insurance, my company finally decided to share the cost with its employees. The health insurance premium for 2008 goes up 50% (from $600/year to $900/year). The deductible and out-of-pocket max also increases to $300/family member and $1,000/family member respectively while coverage decreases by 10% to 90% in-network and 70% out-of-network.

The company is offering a second plan at no premium cost, but with lower coverage (80% in-network, 60% out-of-network) and hefty deductible ($500/family member) and out-of-pocket max ($1,500/family member). This plan will cost me less if my family stays healthy, but a lot more if we have a major medical event.

These costs are probably still well within the national average. But it is a bit of a wake-up call after having been spoiled for so long. On the plus side, the company offers a gym membership free of charge. So there is no excuse not to stay healthy!

Daytrade SOLF Long

What did I see? An orderly retracement with narrow range bars on decreasing volume.

Entry on the break of 6th bar high with a 17.25 limit order at 11:08am. Initial stop below 6th bar low at 17.02. After the PnL exceeded +1R, I entered a 0.50 trailing stop. Stopped out at 19.34 at 12:19pm.

Risk (R) = 0.23, 1000 shares, $250
PnL = +8.29R, $2073.70

Net Worth Update as of Nov 30, 2007

The stock market had a bad month which is reflected in my net worth down 3.45% compared to a month ago. It now stands at $369,200. There were some signs of relief though towards the end of the month as the Fed hinted that there might be another rate cut in mid-December after all. At the last Fed meeting on Oct 31st, they hinted the exact opposite. Since then the S&P 500 has reached correction territory (-10% from last high) in November.

2012 Net Worth Goal Achieved – Drops from 38% to 37%
2007 Net Worth Goal Achieved – Drops from 97% to 93%

I will now need a Christmas miracle to reach my goal for 2007.

Daytrading Rules

I am not a daytrader by any means. But every now and then I like to gamble a little bit. As opposed to Las Vegas style gambling where the house has always the upper hand, I believe that with a good strategy and strong discipline, there is a good chance to come out ahead.

I have drawn up some daytrading rules intended to keep me in control of my risk. The basic idea is to keep the losses small and let the winners run.

General Rules

-Use moving averages to plot the trend. Do not trade against the trend.
-Size my position on every trade according to risk taken.
-Use 15’ or 30’ setups.
-Trade only stocks with daily average volume >400K

Entry Rules

-Enter on the break of a narrow range bar (NRB)
For Longs: NRB should close around the opening range (OR) high
For Shorts: NRB should close around the OR low

Stop Rules

-Always place the stop order right after the entry is executed
-Place the stop a few cents below the narrow range bar
-Move the stop to break-even after the stock has moved to one time the risk

Exit Rules

- Consider taking partial profit at two times the risk
- Use a trailing stop to exit the trade.

If I were to daytrade full time, I would work on fine tuning the criteria to enter the trade. For now I will keep it open and try to learn from experience. The opportunities for me to daytrade do not come by very often because of my day job. I will try to log my trades in this diary.

Stock Market Snapshot as of Nov 17, 2007

The S&P 500 is in a downtrend since Oct 10th. It is below its 200-day SMA which acted as resistance on Nov 14th.


The Nasdaq 100 is faring a little bit better, sitting between its 50-day and 200-day SMAs. The 200-day SMA could act as support again as it did in August.


The Russell 2000 has been the weakest of the bunch for a while now, failing to beat the July highs in October. It is below the 50-day SMA which itself is below the 200-day SMA.

A Look at my Health Care FSA Eligible Expenses

I am contemplating opening a Health Care Flexible Spending Account for next year. After studying the FSA documentation my company provided, I was surprised to find out that condoms are an eligible expense! So are any birth control expenses for that matter. The following eligible expenses are or may become relevant to me:

-Birth control
-Childbirth class, Lamaze class
-Contact lenses and solutions
-Coinsurance, co-payments and deductibles
-Dental care
-Prescription drugs
-Over-the-counter medicine and supplies
-Eyeglasses
-First aid kits
-Health screenings
-Vaccinations/Immunizations
-Maternity services (prenatal care, delivery, care provided after delivery)
-Sales Taxes
-Transportation to/from receiving medical care including health care providers, hospitals and pharmacies ($0.20/mile in 2007)

In 2007 my only expenses were contact lenses ($161) and solutions (around $50). For next year with a baby due in March, I can definitely add the childbirth class and maternity services.