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I might be missing something in regard to your ETF trading. From your
emails I interpret what you're saying as you can make more money on
sector ETFs because some of them grow more than twice as fast as the
market. If you can't short ETFs in your accounts, then you can't buy
them on margin, which means they have to grow twice as fast to equal
the money you could make from a Rydex 2X the market fund.
In my experience, I've rarely seen a sector that's growing twice as
fast as the market unless the overall market is in a period of
congestion or sideways movement. Even when sectors are growing 2
times faster, slippage, etc eats up a part of that gain.
What I'm asking is how do you make more money in an account that's
not shortable or marginable than you can in a Rydex 2X fund.
I've been trading full time for a long time, and I thought I had
looked at these relationships fairly closely. What am I missing.
Thanks
JO
--- In equismetastock@xxxxxxxxxxxxxxx, "drstutz" <drstutz@xxxx> wrote:
> Thanks for your suggestion. Some of the ETFs I trade are in a
retirement
> fund where shorting is not permitted. Although both ProFunds and
Rydex have
> ¡Èreciprocal¡É NASDA and S&P funds, there are no reciprocals
for
the sector
> funds.
>
>
>
> By negative correlation I mean 100% uncorrelated. For example, $TYX
(rising
> interest rate index) usually moves in an opposite direction of
telecom type
> securities or an ETF like TTH.
>
>
>
>
>
> -----Original Message-----
> From: manohohman [mailto:no_reply@xxxxxxxxxxxxxxx]
> Sent: Thursday, October 16, 2003 1:11 PM
> To: equismetastock@xxxxxxxxxxxxxxx
> Subject: [EquisMetaStock Group] etfs
>
>
>
> I'm not sure what you mean by inverse. Why don't you short the ETFs.
> That's what I do.
>
> I've found that the indicators from John Clayburg's book Four Steps
> to Trading Success work great on ETFs and even better on Mutual
> Funds.
>
> Rydex has 2X long and short funds for both the S&P and the Nasdaq.
> That's one solution.
>
> JO
>
>
>
>
> --- In equismetastock@xxxxxxxxxxxxxxx, "drstutz" <drstutz@xxxx>
wrote:
> > I am a market timer. I trade predominately ETFs. I have found the
> recent MS
> > TrendMedium to give fairly reliable signals about when to enter
and
> exit a
> > given sector ETF. Is anyone able to devise a system to find
> a "inverse
> > sector ETF" or security to hold when a given sector falls from a
> bull to
> > bear status so that I can remain fully invested? Or, on a broader
> note is
> > there a way use MS to determine negative correlations for a given
> security
> > or ETF?
>
>
>
>
>
>
>
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