USPIX

[EJ]

In the never ending quest for beaten down assets, very hard to find these days, this looks like a potential candidate. Did well with it 2000 - 2001. Looks mightly beaten down to me now. It's an index fund, negative 2x beta to the NASDAQ...

http://finance.yahoo.com/q/bc?s=USPIX&t=my&l=on&z=m&q=l&c=

[jeffolie]

I have used this ProFunds inverse fund and have found it efficient.

[EJ]

Took my own advice here. Anyone else?

[blazespinnaker]

Hmmm, got one that does the same for the DOW?

[blazespinnaker]

Thought I'd bump this, because looking back, the timing of this was rather suprisingly dead on.

I believe there is another thread around here where EJ suggested a quick exit as well.

I'd love to hear more of a background as to why this play was called :)

[EJ]

Thought I'd bump this, because looking back, the timing of this was rather suprisingly dead on.

I believe there is another thread around here where EJ suggested a quick exit as well.

I'd love to hear more of a background as to why this play was called :)
You've probably noticed I rarely make a call. That's because I rarely trade. My credo is read/research/analyze/do-nothing, often for years on end. Then, when an opportunity arises, place a big bet and then go back into read/research/analyze/do-nothing mode.

I'd been patiently watching USPIX for years before the call you refer to. When after several years it looked like it had finally bottomed, I noted a buy. I also pointed out that unlike other things I study to buy and hold, negative index funds ain't one of them. The trick with these funds is to catch the first big wave down, then get out before your profits get taken back in the next rally, and it's the first leg down that's the most profitable.

That said, this market is due for a different kind of decline. The bear market that started in April 2000 (http://www.itulip.com/urgentmessage.htm#Bear) resumed in May 2006, but with a decidedly worse set of antecedents in 2006 than in 2000.

Policy bullets spent: dollar devaluation, deficit spending, tax cuts, foreign central bank support of trade deficits. Policy bullets remaining: liquidity and rate cuts. Geopolitical risks: greater (Middle East and Asia). Macroeconomic risks: greater (Global Margin Call on real estate).

Perhaps our Real DOW takes path A:

http://www.itulip.com/images/eh2ej2.gif

Real DOW (http://www.itulip.com/realdow.htm)