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On Apr 23, 2:15pm, Earl Adamy wrote:
> Subject: Re: Question for SPY traders
> Not only is the SPY Depository expense ratio in line with the Vanguard expense
> ratio, but SPY carries some of the volitility characteristics of futures and
> options i.e. the premium over cash expands in rising market and falls in
> declining markets.
Earl's point is a good one. Sometimes, if I want to run a study on
"the S&P", or OEX, I'll use SPY instead. I think in some way's the SPY
is superior to using a continuous (back-adjusted) S&P contract, because
it has a real market, and traded at the prices shown. With that said, I
haven't looked at the exact correlation to the front month S&P. Still,
SPY's do have an opening quote, which SPX and OEX do not. So, if you
wanted to get a feel, for example, on how the S&P 100 or the S&P
futures might've opened on a given day, SPY's are a pretty good
approximation.
While we're on SPY's, don't forget the new "diamonds" (DIA's),
that track the DJIA. Smaller number of stocks,
(slightly) more volatility, and DJX options to hedge them with.
--
| Gary Funck, Intrepid Technology, gary@xxxxxxxxxxxx, (650) 964-8135
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