Posts filed under “Index/ETFs”
Kevin Lane is one of the founding partners of Fusion Analytics, and is the firm’s director of Quantitative Research. He is the main architect for developing their proprietary stock selection models and trading algorithms. Prior to joining Fusion Analytics, Mr. Lane enjoyed success as the Chief Market Strategist for several sell side institutional brokerage firms….Read More
A few interesting Gold discussions lately (See chart below) Also, see Eddie Elfenbein’s Central Bank Gold Sales Began 10 Years Ago This Week: Has it Worked? Via Chart of the Day: “Today’s chart presents the Dow divided by the price of one ounce of gold. This results in what is referred to as the Dow…Read More
We finally get the answer to the question we have been asking since 2007: When will GM get kicked out of the Dow? The editors at Dow Jones are now hinting what everyone else already knew: GM is going to be replaced in the Dow Jones Industrial Average — and replaced sooner rather than later….Read More
Bianco: The Dow is Distorted January 21, 2009 James A. Bianco, CEO of Bianco Research, LLC Comment – The Dow Jones Industrial Average (DJIA) is a price weighted index. The divisor for the DJIA is 7.964782. That means that every $1 a DJIA stock loses, the index loses 7.96 points, regardless of the company’s market…Read More
The major commodities indices are being rebalanced, and I am forced once again to question their timing. Recall the last major rebalance: At the time, I had been challenged by Larry Kudlow to find a smoking gun for the sudden 2006 collapse of Oil prices a month or two before the mid-term election. That challenge…Read More
Here is the money paragraph: The focus of the Committee’s policy going forward will be to support the functioning of financial markets and stimulate the economy through open market operations and other measures that sustain the size of the Federal Reserve’s balance sheet at a high level. As previously announced, over the next few quarters…Read More
Mark McHugh is a financial professional and former associate of a large investment firm.
He provides fee-based financial planning and tax preparation services in the Philadelphia area.
Editor’s Warning: Although Mark McHugh shares a surname with a respected contributor to The Big Picture Café, we’d like to state for the record, that Mark doesn’t know Jack.
Are You getting ETF’d?
Objective: UltraShort Blah-Blah ProShares seeks daily investment results, before fees and expenses, that correspond to twice (200%) the inverse (opposite) of the daily performance of the Blah-Blah Index.
Remember when you first heard about these leveraged ETF’s? That little part of your brain that actually wants you to survive started flailing its’ arms saying, Hold on there, Chief…. Double the gains?…How does this work?…How much fees and expenses?…Can this possibly work?…Remember? And you said, “Shut-up brain, I know what I’m doing.” Double your pleasure, double your fun, double your risk of cardiac arrest while just sitting in front of a computer. Now look at you, after a handful of “Plaxico” incidents, trying to externalize the whole thing.
Real men don’t read prospectuses, I always say. So when the eggheads at ProShares (and others) offered to warp time and space just for me, I was excited. Now, thanks to the recent performance of the SRS (ProShares Ultra-short Real Estate) and URE (ultra-long), I believe I’ve discovered a wormhole to a whole new dimension of excitement.
Take this past Monday, for instance:
While not able to understand to understand the Theory of Relativity, I can multiply by 2 (and subtract). Is a couple percent off target anything to be concerned about? The difference amounts to about $0.13 for URE holders and about $4.35 for SRS longs. I’d multiply that by the number of shares outstanding, but the only data I can find (MSN) says there are 8m shares of SRS outstanding (it traded over 15m today). And Yahoo says the expense ratio is 0.95% (sometimes the jokes just write themselves).