Yes
But there is a way that
you can normalize all the funds to determine the true beta of the fund
So I understand you did
not do that
Nothing wrong with doing
it as what the fund is trying to achieve just if you were going to hedge using
the fund you would have to do this
Yes all transactions are
free
Have an account with both
There are charges in the
funds most have them if not all But Rydex and Profunds were set up for short
term trading of mutual funds, so there is no transaction fees. So the fee
that the fund charges is built into the price
SO if the RUT does 2.01%
today and UAPIX might show 4.01% tonight, so there is a slight difference in
the 2x beta guess who gets that little extra each day.
Also the index funds you
need to see what they are holding since they are not holding the exact stocks
that the index they are following holds, so on some days there can be a larger
difference
Mark
From: amibroker@xxxxxxxxxxxxxxx [mailto:amibroker@xxxxxxxxxxxxxxx] On Behalf Of Steve Dugas
Sent: Thursday, May 25, 2006 3:10
PM
To: amibroker@xxxxxxxxxxxxxxx
Subject: Re: [amibroker]
Leveraged/Inverse Funds
Hi Mark - It is pegged to the index for each fund, so
for example if a particular fund has
an Index of Russell 2000 and Beta of 2, then the goal of the
fund is to achieve twice the return of the RUT (but you will also have
twice the losses on bad days ). As D pointed out, they seek to
achieve this on a daily basis, and with compounded leverage the results
aren't necessarily what you would expect over time. From reading a
few different sources, it seems the consensus is that over time, returns are
better than the goal in trending markets and less than the goal rangebound
markets - the more days in the same direction, the higher/lower the
returns. But I should stress again that I have only read about these
- I am only learning about them now and have never actually traded
them (yet).
Re your previous post, do you mean that if you deposit your
money directly with one of these fund companies, then there are no commissions
AND no fees, *everything* is free? How does the company make their money?
----- Original Message -----
Sent: Thursday, May 25,
2006 12:49 PM
Subject: RE: [amibroker]
Leveraged/Inverse Funds
Also
On you chart you have the
Beta for these
What are you comparing it
to? S&P ? or something else
Mark
From: amibroker@xxxxxxxxxxxxxxx [mailto:amibroker@xxxxxxxxxxxxxxx] On Behalf Of Steve Dugas
Sent: Thursday, May 25, 2006 10:44
AM
To: Yahoo - AmiBroker
Subject: [amibroker]
Leveraged/Inverse Funds
If anyone is interested in leveraged/inverse funds, here is
a spreadsheet I put together yesterday with some useful info
for comparing Rydex/Profunds/Direxion funds. Performance is not included because
I am looking at them with an eye toward actively trading them. Info comes from
most recent fact sheets/prospectus/annual reports. Sort columns in any
order to compare them, but select all columns first so they sort in sync (
unless you know an easier way and then please let *me* know... 8 -
)
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