Posts filed under “Index/ETFs”

Fed Fighting Deflation

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 the Federal Reserve will purchase large quantities of agency debt and mortgage-backed securities to provide support to the mortgage and housing markets, and it stands ready to expand its purchases of agency debt and mortgage-backed securities as conditions warrant.  The Committee is also evaluating the potential benefits of purchasing longer-term Treasury securities.  Early next year, the Federal Reserve will also implement the Term Asset-Backed Securities Loan Facility to facilitate the extension of credit to households and small businesses.  The Federal Reserve will continue to consider ways of using its balance sheet to further support credit markets and economic activity.

Do you get the sense these guys are serious about fighting deflation?

Category: Bailouts, Federal Reserve, Index/ETFs

How to become Ultrabroke

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.

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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).

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Category: BP Cafe, Index/ETFs, Markets

Mega-Bear Quartet

Doug Short overlays the 4 major bear markets of the past centruy onto one chart. Its a comparison of today’s S&P 500, the Dow post 1929, the Nikkei post 1989, and the NASDAQ after the tech bubble: > Chart via Doug Short Here’s another link that allows you to see the comparison by degrees. Very…Read More

Category: Index/ETFs, Markets, Short Selling, Technical Analysis

Stopped Out Longs, Possible Shorts

Dow is at 7997.28; S&P500 is at 806.58. Our cash position is back to 75%, we are still 25% long (including inverse funds). On this break, we could see (technically) a low of 681 on the SPX, Dow 7,100, and Nasdaq 1070. (There are deeper levels, but its too ugly to write now). Last week,…Read More

Category: Index/ETFs, Technical Analysis, Trading

ETF volume relative to underlying index volume

As the market has sold off since January, exchange-traded fund volumes have outpaced those of the underlying indexes, suggesting that ETFs are increasingly becoming the hedging and speculative mechanisms of choice in the U.S. equity market. Since the year began, volume in the PowerShares QQQ (QQQQ) ETF relative to the Nasdaq-100 index has jumped from…Read More

Category: BP Cafe, Index/ETFs, Technical Analysis

Today’s Five Favorite Videos

Today’s Video: The Onion on Obama’s Obsessive Supporters Trichet: ECB Rate Cuts `Substantial,’ More Possible Rough Road Ahead for Retailers Are Stocks Cheap? Paul Disses the Triple Leverage ETF

Category: Economy, Federal Reserve, Index/ETFs, Markets, Politics, Trading

3X Exchange-Traded Funds

When we made our buy ‘em call on October 10th, we wanted to avoid single stock risk. And, we wanted to have prudent exposure, while still maintaining some cash levels. Our solution was to deploy enough cash into 2 to 1 leveraged funds on the S&P (SSO) and the Nasdaq 100 (QLD) so that our…Read More

Category: Index/ETFs, Markets, Trading

Paul Disses the Triple Leverage ETF

Nearly every sector of the financial world is mid-way through a painful unwinding of all things leverage. That’s right, I said nearly every sector. Triple-levered ETF funds have just launched and my guest blogger and investor Paul Kedrosky calls them ticking time bombs waiting to explode.

Why the market likes them, and Kedrosky hates them in the clip.

Source:
When Exchange Funds Go Bad
Sarah Lacy
Yahoo Tech Ticker Nov 05, 2008 02:00pm

http://finance.yahoo.com/tech-ticker/article/107044/When-Exchange-Funds-Go-Bad

Category: Index/ETFs, Markets, Video

Race to Call the Bottom

No wonder Wired wrote:

That said, your blog will still draw the Net’s lowest form of life: The insult commenter. Pour your heart out in a post, and some anonymous troll named r0rschach or foohack is sure to scribble beneath it, “Lame. Why don’t you just suck McCain’s ass.” That’s why Calacanis has retreated to a private mailing list. He can talk to his fans directly, without having to suffer idiotic retorts from anonymous Jason-haters.

Category: Financial Press, Index/ETFs, Markets, Psychology

S&P 500 Review

http://www.businessweek.com/magazine/content/02_50/b3812104.htm

Category: Index/ETFs, Markets, Quantitative, Short Selling, Technical Analysis