APPENDIX E -- Update of the COP Research Model results through month shown below.															UPDATED through 9/30/2011
	Confusion between this report and the Trend Report
		I do not update the Research Model results every month.  The reason is that 1) The Research Model does not have nearly as many asset classes as does the full COP Report; 2) I do not mean the buy, sell, hold statements, below, to be recommendations – they are merely notes about what the Research Model will invest in for next month; and  3) If you took the top 15 performers (I usually run the model looking for the top 15 to be consistent although arbitrary, but you could go with the top 4 or 20) from the full COP Report you would get the same results as the COP Model, except that there are more asset classes to chose from in the Trend Reports. Note, as an example, if Diversified Emerging Markets is ranked high in the Majors Report, you might go below to the Sub Class sheet and pick specific emerging market countries rather than take the full basket set (EEM).  If you chose individual countries you probably would not include those emerging markets that were performing poorly. THE RESEARCH MODEL WAS SET TO SELECT THE TOP 8 INSTEAD OF THE TOP 15 FOR THIS REPORT
		I have been updating the Research Report only to show that it is a live ongoing effort, still producing good information and/or if I have some point to make about the market – the Research Report has better graphics and summary data.
	What You Are Seeing
	1	Column B provides tha average annual performance over the 20 year period.
	2	The "H=1" lines assume that you invested at the opening of the first day of each month based on Mornigstars web site data.  However the web site data does not provide as many asset classes so you might wait for the
		full data resease on about the 9th of each month.
		In the latter case your performance would be closer to the "H=1.5" lines which assume that you wait and invest on the 15th of the month.  Either way you beat the S&P over the 20 years -- and at a lower volatility.
	3	The line below the S&P shows the difference in annual performance between the H=1 case and the S&P.  Note that it does not look very good for the model in the years 1994, 1995, 1996, 1997 and 1998.
		Actually the model did great.  A look at the details shows that during those years the S&P was the hottest asset class in the world.  Still the model could only invest 1/15th or 1/8th of the porfolio in the S&P.
		The model did quite well and went along at much lower volatility than the S&P.  However, most people would have increased their weight in the S&P (or similar).
		For comparison, if the model is set to invest in just 8 asset classes so that the S&P is limited to 1/8th of the portfolio instead of 1/15th, the models return improves against the S&P by 3%points in each of those years.
	4	Now note 1999 when technology, small caps and emerging markets took off.  Here the model excelled as it moved where the action was.
	5	Now look at the market crash years of 2000, 2001, 2003, late 2007, 2008 and early 2009.  You have to love any model that does that well in years like those.
		If you look at the monthly detail (sorry, no space to provide the detail) of those years you find that the model stumbles badly (often worse than the S&P) at the initial market fall, but quickly discovers those asset
		classes that are working well in the new market environment.
		There are two extremely important lessons in this result: (1) This model, and none other, can forecast the future -- you are making a bet on the future based on the past and you lose that bet often.  (2) Finding the right
		asset class to invest in is extremely more important than picking the right stock, bond, or fund.  Finding the right asset class "fast" doesn't hurt either.  This suggests that we should pay a lot of attention
		to people like Mohamed El-Erain and Bill Gross who are pushing the idea of a "new normal" for the new market environment -- leading asset classes will change.
	20yr	Through 9/30/2011
	Compound
	Average		4thQ																				YTD
	3.02	Average Hold Time (Months)	1991	1992	1993	1994	1995	1996	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007	2008	2009	2010	2011
	15.77%	ANNUAL RETURN O&G, H=1.5	3.22	10.08	38.39	(2.72)	30.08	17.68	14.82	3.92	50.56	14.47	(4.43)	3.82	48.40	9.77	26.36	15.80	18.71	(11.18)	31.51	11.16	6.06
	18.89%	ANNUAL RETURN O&G, H=1	(1.16)	18.16	38.75	0.42	30.48	14.95	19.97	10.66	62.99	10.63	1.14	14.52	56.82	10.91	22.56	18.46	19.78	(4.28)	38.42	8.22	10.03
	7.16%	ANNUAL RETURN S&P	30.42	7.60	9.84	1.15	37.22	22.73	33.08	28.34	20.89	(9.17)	(11.87)	(22.11)	28.39	10.74	4.79	14.58	5.40	(37.87)	25.62	13.37	(9.55)
	11.73%	(ANNUAL RETURN  H=1) Minus S&P	(31.57)	10.56	28.91	(0.73)	(6.74)	(7.78)	(13.11)	(17.68)	42.10	19.81	13.00	36.63	28.43	0.17	17.77	3.88	14.37	33.58	12.80	(5.15)	19.58
	9.72	G&O, H=1.5 Standard Devation	2.86	7.51	6.85	4.89	2.90	7.68	8.10	13.80	10.60	12.39	7.23	9.30	6.72	7.90	8.75	7.49	6.20	8.83	14.93	10	5
	13.19	G&O Standard Devation, H=1	4.69	8.89	9.39	9.08	5.83	9.58	11.85	15.96	19.63	17.53	8.68	11.95	10.38	11.16	12.97	13.42	13.14	11.17	17.94	14	6
	15.05	S&P Standard Devation	15.16	7.13	5.81	10.07	4.96	10.36	15.24	20.52	12.55	16.39	18.97	19.70	10.90	6.97	7.56	5.47	9.22	20.04	21.30	18	12
Research Model Settings:
1	The 20 year period is a rich sample periond.  Look at the return of the S&P 500 above.  It covers the boom of the late 1990s, the recession and market bust of 2000, 2001 and 2002,
	the recovery period of 2003 and the crash of late 2007 and 2008 as well as early 2009.
2	The model  invests in the top 15 performing asset clases (THIS MONTH THE TOP 8) out of 51 possible as long as the performance is better than cash, in which case it invest is money markets.
3	In this run, or test case, the model is using the MS momentum calculation which is focused heavily on the last three months.  Should market volatility decreased, it may pay to swithch to the ML (longer term) momentum calculation.
	I could change at any time.
Model's Investments 2010 and 2011YTD
	This chart shows what the model has invested in during this period.  Blue is not invested.  Yellow means that it was a good investment but the model could not react until the next month, so yellow is a buy signal.  Green shows that the model is invested. Orange is a bad month because the asset class turned bad or at least there are higher performing assets, however the model is still invested. Notice the large amount of orange and yellow caused by the high volatility in 2010 and 2011. The model did well when it went to all cash and bear market funds in 2008.  Note at the bottom right that the model is putting 1/8th in cash in October because it could not find a better 8th asset class. In July 2011 you will see that the model was invested in Bear Market which dropped out of the top 8 but was pretty good and contrast that with Sept 2011 where we were in Precious Metals and they dropped to the bottom.
		The BUY, SELL, HOLD tell you what the model will do in the next month.
		Year >		2009	2010	2010	2010	2010	2010	2010	2010	2010	2010	2010	2010	2010	2011	2011	2011	2011	2011	2011	2011	2011	2011
		ASSET CLASS          Month >		1	1	2	3	4	5	6	7	8	9	10	11	12	1	2	3	4	5	6	7	8	9	OCT '11
		S&P500>SPDRs		56	46	14	21	14	48	59	21	55	26	24	14	15	6	14	55	27	48	55	50	41	39		SPDR S&P 500
		Cat: Bear-Market		2	2	66	66	66	2	2	66	5	66	66	66	66	62	66	56	66	36	4	9	3	2	HOLD	Cat: Bear-Market
		Cat: Conservative Allocation		34	34	26	34	28	33	34	35	37	36	35	27	35	28	32	28	36	19	34	38	33	31		Cat: Conservative Allocation
		Cat: Convertibles		30	38	12	29	13	36	42	28	44	29	26	15	29	13	25	29	35	43	59	51	42	37		Cat: Convertibles
		Cat: Diversified Emerging Mkts		49	58	39	8	22	53	37	7	36	8	15	22	27	60	64	2	15	50	53	41	53	64		Cat: Diversified Emerging Mkts
		Cat: Diversified Pacific/Asia		52	48	25	12	36	56	43	15	41	17	21	17	20	33	31	60	24	61	33	13	50	61		Cat: Diversified Pacific/Asia
		Cat: Emerging Markets Bond		8	15	27	31	30	34	7	16	6	35	34	61	38	58	40	9	30	11	5	8	28	35		Cat: Emerging Markets Bond
		Cat: Europe Stock		62	56	65	18	65	65	48	2	47	6	6	60	12	16	13	53	2	59	46	55	66	62		Cat: Europe Stock
		Cat: Foreign Large Blend		59	59	62	24	62	62	46	6	46	12	12	55	17	27	21	58	7	58	39	49	60	58		Cat: Foreign Large Blend
		Cat: Foreign Large Growth		51	55	57	17	46	59	41	9	42	10	10	29	16	30	26		5	53	41	47	51	59		Cat: Foreign Large Growth
		Cat: Foreign Large Value		57	57	63	27	63	64	51	8	48	15	16	59	19	14	16	63	10	60	38	54	62	49		Cat: Foreign Large Value
		Cat: Foreign Small/Mid Growth		47	51	58	15	20	60	38	5	40	3	3	20	8	31	28	17	6	49	48	44	49	60		Cat: Foreign Small/Mid Growth
		Cat: Foreign Small/Mid Value		46	42	61	11	19	58	40	10	45	11	13	23	5	21	24	23	11	57	47	46	57	54		Cat: Foreign Small/Mid Value
		Cat: High Yield Bond		5	3	28	32	21	32	13	32	15	38	32	32	36	23	33	28	40	15	36	16	36	30		Cat: High Yield Bond
		Cat: High Yield Muni		6	8	21	39	35	4	12	41	4	41	40	64	64	61	57	29	42	3	2	4	7	3	HOLD	Cat: High Yield Muni
		Cat: Intermediate Government		11	9	55	61	40	3	5	42	12	48	42	53	61	53	63	50	45	9	9	11	4	6	HOLD	Cat: Intermediate Government
		Cat: Intermediate-Term Bond		10	6	33	40	38	10	6	40	10	42	41	54	59	51	41	47	44	10	29	10	11	24		Cat: Intermediate-Term Bond
		Cat: Japan Stock		60	11	23	10	34	57	53	39	60	30	39	9	9	19	4	64	46	64	1	2	40	33		Cat: Japan Stock
		Cat: Large Blend		53	47	13	20	16	50	54	19	54	24	22	13	18	9	19	30	22	47	52	52	44	43		Cat: Large Blend
		Cat: Large Growth		44	54	11	19	17	47	62	22	58	16	7	11	23	11	20	22	21	44	45	45	47	44		Cat: Large Growth
		Cat: Large Value		58	43	16	16	15	51	56	18	53	27	28	16	13	7	12	24	23	45	54	57	45	42		Cat: Large Value
		Cat: Latin America Stock		36	65	15	22	33	63	45	1	18	1	4	18	25	65	37	4	33	56	44	65	43	66		Cat: Latin America Stock
		Cat: Long Government		37	5	64	65	24	1	1	34	2	65	65	65	65	63	61	51	34	2	37	1	1	1	HOLD	Cat: Long Government
		Cat: Long-Term Bond		31	4	36	38	26	27	4	31	3	40	44	57	60	56	35	45	37	5	32	3	8	5	HOLD	Cat: Long-Term Bond
		Cat: Mid-Cap Blend		48	41	6	7	6	44	63	25	62	18	20	7	11	4	8	10	18	42	56	61	59	51		Cat: Mid-Cap Blend
		Cat: Mid-Cap Growth		45	50	4	9	8	41	55	27	57	9	9	3	14	8	10	8	13	41	43	59	52	48		Cat: Mid-Cap Growth
		Cat: Mid-Cap Value		55	37	7	6	7	45	61	24	61	21	23	12	10	5	11	13	26	37	57	62	55	47		Cat: Mid-Cap Value
		Cat: Moderate Allocation		39	39	22	30	25	38	44	29	49	34	31	19	32	24	29	27	32	39	40	43	37	34		Cat: Moderate Allocation
		Cat: Multisector Bond		9	7	31	36	29	29	8	38	11	39	38	52	37	32	34	25	43	14	31	15	31	28		Cat: Multisector Bond
		Cat: Muni tiol Interm		4	13	29	63	39	6	14	43	8	45	63	58	62	57	38	26	41	8	6	12	6	7	HOLD	Cat: Muni National Interm
		Cat: Muni tiol Long		3	12	24	44	37	5	16	44	7	43	47	63	63	59	39	55	39	6	3	6	5	4	HOLD	Cat: Muni National Long
		Cat: Muni tiol Short		7	17	35	64	44	9	15	45	16	64	64	56	58	54	58	56	47	13	7	17	9	23		Cat: Muni National Short
		Cat: Pacific/Asia ex-Japan Stk		43	61	34	23	27	49	33	12	14	4	11	25	34	64	65	1	19	40	35	18	54	63		Cat: Pacific/Asia ex-Japan Stk
		Cat: Short Government		13	14	56	62	45	8	10	47	19	47	45	50	57	52	62		49	16	27	19	12	25		Cat: Short Government
		Cat: Short-Term Bond		12	10	37	42	41	26	11	46	17	44	43	49	56	49	59	48	48	18	28	20	29	27		Cat: Short-Term Bond
		Cat: Small Blend		61	40	3	5	4	40	65	30	65	13	17	2	4	15	6	7	17	52	58	60	63	57		Cat: Small Blend
		Cat: Small Growth		54	45	5	4	5	37	57	37	63	7	8	1	7	12	5	5	9	38	49	64	64	55		Cat: Small Growth
		Cat: Small Value		63	35	2	2	3	39	66	33	66	20	25	6	3	17	7	11	28	54	61	58	61	53		Cat: Small Value
		Cat: Specialty-Communications		42	63	19	14	12	35	47	3	43	5	18	26	26	25	18	15	16	12	60	66	38	41		Cat: Communications
		Cat: Specialty-Fincial		66	36	20	3	11	54	64	20	64	28	36	30	6	18	17	59	38	62	62	63	65	56		Cat: Financial
		Cat: Specialty-Health		33	1	17	26	64	52	52	64	51	22	29	24	28	20	23	6	1	1	11	53	46	36		Cat: Health
		Cat: Specialty-tural Res		40	60	18	28	18	61	60	14	52	14	5	5	1	3	3	12	29	63	64	40	58	65		Cat: Natural Res
		Cat: Specialty-Precious Metals		1	66	10	35	1	7	3	65	1	23	2	4	24	66	1	16	3	66	65	7	2	52	SELL	Cat: Equity Precious Metals
		Cat: Specialty-Real Estate		65	49	1	1	2	30	49	4	38	33	19	31	30	10	9	62	8	4	51	14	39	45		Cat: Real Estate
		Cat: Specialty-Technology		38	62	9	13	9	43	58	17	56	2	1	8	21	2	15	57	25	55	63	56	56	40		Cat: Technology
		Cat: Specialty-Utilities		35	52	59	37	23	46	35	11	13	32	27	51	33	22	27	14	14	7	10	42	32	32		Cat: Utilities
		Cat: Ultrashort Bond		14	16	38	45	43	28	32	63	20	46	46	48	55	50	60	49	65	35	30	36	30	26		Cat: Ultrashort Bond
		Cat: World Allocation		41	44	32	33	32	42	36	23	39	31	30	28	31	29	30	21	20	46	42	39	35	38		Cat: World Allocation
		Cat: World Bond		32	18	60	43	42	31	9	26	9	37	37	62	39	55	36	19	31	17	8	5	10	29		Cat: World Bond
		Cat: World Stock		50	53	30	25	31	55	50	13	50	19	14	21	22	26	22	25	12	51	50	48	48	46		Cat: World Stock
		Commodities		64	64	8	41	10	66	39	36	59	25	33	10	2	1	2	26	4	65	66	37	34	50		iPath S&P GSCI Total Return Index ETN
		Cash		15	19	40	46	47	11	17	48	21	49	48	33	40	34	42	31	50	20	12	21	13	8	BUY	Cash