HOW ONE iTuliper IS INVESTED?

[jpatter666]

Re: HOW ONE iTuliper IS INVESTED?

... and stopped out after a 12% loss for that position. One thing is clear to me: if you are wrong on the timing of your entry with a leveraged ETF, it is better to cut your losses and re-enter later instead of holding on until you are right. I think I'll give this type of trade one more chance at a different entry point before I revert to my baseline speculative strategy of long-dated options against indexes.

Yep, that's why I prefer options to the speculative ETFs. They seem to act the same (in fact, they *are* essentially the same since many of these ETFs use options). But with the options, even if I'm substantially down (which, unfortunately, for my first entries I am!), if things turn around I'm back in the black fast.

Not so, with these ETFs (and the more leveraged, 2X, 3X etc the worse) which because of the daily rebalancing tend to head down and stay there. They not only seem to need a fair amount of volatility, but they need it in the right direction.

[ASH]

Re: HOW ONE iTuliper IS INVESTED?

Today, I opened a larger speculative position against the S&P500.

... and stopped out after a 12% loss for that position. One thing is clear to me: if you are wrong on the timing of your entry with a leveraged ETF, it is better to cut your losses and re-enter later instead of holding on until you are right. I think I'll give this type of trade one more chance at a different entry point before I revert to my baseline speculative strategy of long-dated options against indexes.

[ST]

Re: HOW ONE iTuliper IS INVESTED?

I just shop around for CDs. In 2007 I locked in a bunch at 5.5% for two years. In fall, Corus and other shaky banks gave 5% on 9 months. I'm rolling those into some at Citi for 2.4% for 6 months. It's a pain in the ass but it's just where I want my money in this nonsense. Hearing about looming inflation but a short term deflation cycle is making me crazy. My cash is turning to poop but commodities and emerging markets look like a nasty bubble.

If there is a dip, then I will go after gold, some blue chips and more energy stocks (including alt energy). But so will everyone else.

Hmmm...yes sounds like a pain but worth it for the extra kick if you don't need full access at any time. At this point I want to be able to move money at an instant - like this fall/next spring at which time I will probably pick up some small north of the border plays that will give extraordinary gains in a scenario where players realize inflation is here.

[goadam1]

Re: HOW ONE iTuliper IS INVESTED?

1 - yeah, looks that way. It looks like if the etf moves against you initially it only gets harder to get back to square one - timing component is tight.

2 - LOL

3 - yes, me too - not very itulipie but c'est la vie

4 - just wondering in your bond, cd exposure etc... aren't you finding it difficult to beat the liquidity and rate of online only 'high interest' at hsbc, ing etc... totally liquid and circa 1.48% ? or 1.96% at AIG?

I just shop around for CDs. In 2007 I locked in a bunch at 5.5% for two years. In fall, Corus and other shaky banks gave 5% on 9 months. I'm rolling those into some at Citi for 2.4% for 6 months. It's a pain in the ass but it's just where I want my money in this nonsense. Hearing about looming inflation but a short term deflation cycle is making me crazy. My cash is turning to poop but commodities and emerging markets look like a nasty bubble.

If there is a dip, then I will go after gold, some blue chips and more energy stocks (including alt energy). But so will everyone else.

[charliebrown]

Re: HOW ONE iTuliper IS INVESTED?

I read the quarterly report of SPG, the biggest component of IYR. believe it or not they had an increase in rental rates per sq foot on renewing leases, even though the store's sales per sq ft is falling fast. Dang, did they send some mob bosses down to the store's GM? How did they pull that off?

[charliebrown]

Re: HOW ONE iTuliper IS INVESTED?

well if iyr which is the forward index that srs is based upon goes from 38 (today's price) , to 23 (march low) in one day, then you are looking at an 80% return, so the price will be around $23 (assuming no index tracking error). Now this is not going to happen. I don't understand what would happen to the price of SRS if say IYR went to $23 in 3 months, along a zig-zagging up pattern. Would it still be at $23?

[dummass]

Re: HOW ONE iTuliper IS INVESTED?

Do you think there is any chance that SRS will have a huge upturn as it has in the past?

I rode SRS down, am very underwater now, and am wondering at what point I should bail out???

It may help, if you understand the other side of the trade. After the last recession (2001), I made a lot of money buying ICF. Why?

Because CRE benefits from a low interest rate environment. The interest payment, on the mortage, is the greatest expense to a CRE investment. Also, if timed towards the end of the recession, income from CRE will increase in the following ways: 1) occupancy will rise 2) rents will increase and 3) Cap rates will decrease.

This has been the pattern and investors are playing the cycle. What most people don't realize is that this time is different: 1) CRE will not benefit from the near zero percent interest rates, because banks are not lending 2) occupancy will not rise because there will not be an improvement in employment 3) rents will not be going up and 4) Cap rates will trend higher as forclosures continue to weigh on the market.

You can't fight ignorance; it has a numerical advantage.

[ST]

Re: HOW ONE iTuliper IS INVESTED?

It's clear that inverse ETFs are bullshoots!

2% negatively correlated lunatic losing money all the time plays

gold drop buy more ... Not very itulipie.

1 - yeah, looks that way. It looks like if the etf moves against you initially it only gets harder to get back to square one - timing component is tight.

2 - LOL

3 - yes, me too - not very itulipie but c'est la vie

4 - just wondering in your bond, cd exposure etc... aren't you finding it difficult to beat the liquidity and rate of online only 'high interest' at hsbc, ing etc... totally liquid and circa 1.48% ? or 1.96% at AIG?

[ST]

Re: HOW ONE iTuliper IS INVESTED?

Commercial real estate will crash I think. But how its reflected in the market, who knows?

Maybe puts on KRE? But the problem I see there is long dated puts aren't available so safety is narrow. Thoughts?

[raja]

Re: HOW ONE iTuliper IS INVESTED?

FL and ASH good luck to both of you. I got burned really bad on SRS. Everything I see, read and hear about real estate says r.e. has more to go down especially commercial. I live in the western suburbs of chigago, I would estimate that 20 - 30% of retail property is vacant. There are also a lot of space available signs on office towers around me.

I bought SRS at 35, watched it go down to 22 on July 10. Went on vacation for a few weeks and boom its down to 11. IYR went up 35% in three weeks. wth?? Now if IYR returns to its 7/10, price SRS most likely moves to around 18. So I'm out $4.00 a share even with IYR moving back to the 7/10 price.

Anyhow, this thing has scared me off of reverse etf's. I still own SRS at 13 today. I'm writing agressive OTM calls on it. I think if I'm called out, I'm out. I only had 3% of my money in it fortunately. Thanks to itulip, and a few other contrarian web sites I pulled most of my money out before sept 2008. So i'm smarting over my 2% loss of capital.

I would not be surprised if there is some behind the scenes game going between the fed, treasury, banks, foreign central banks etc propping up the stock market in an attemp to boost consumer sentiment.

Do you think there is any chance that SRS will have a huge upturn as it has in the past?

I rode SRS down, am very underwater now, and am wondering at what point I should bail out???

[goadam1]

Re: HOW ONE iTuliper IS INVESTED?

Below is where I sit right now.

I am up just shy of 1% overall this year due to my cash returns offset by overall unsuccessful speculative plays with HNU and HOU.

I would follow Dumbass and CharlieBrown lead with NG, but given EJ's latest research on China [as well as GRG55 recent comments], I am certainly not prepared to go long with a leveraged ETF.

Cash	57.0%
Gold	26.7%
Silver	8.6%
Platinum	6.8%
Palladium	0.8%
Total:	100.0%

My speculative money is 5% of the total. I cannot decide what to do with it, but I am sure Finster, bart and icm63 will have some suggestions ;).

The consensus seems to follow the bouncing ball. You either choose to trade the bounce or sit it out. I'm anxious to get out of some cash but the feedback here is we are in for a little disinflation.

[LargoWinch]

Re: HOW ONE iTuliper IS INVESTED?

Below is where I sit right now.

I am up just shy of 1% overall this year due to my cash returns offset by overall unsuccessful speculative plays with HNU and HOU.

I would follow Dumbass and CharlieBrown lead with NG, but given EJ's latest research on China [as well as GRG55 recent comments], I am certainly not prepared to go long with a leveraged ETF.

Cash	57.0%
Gold	26.7%
Silver	8.6%
Platinum	6.8%
Palladium	0.8%
Total:	100.0%

My speculative money is 5% of the total. I cannot decide what to do with it, but I am sure Finster, bart and icm63 will have some suggestions ;).

[goadam1]

Re: HOW ONE iTuliper IS INVESTED?

Yeah I bought a little SRS before I knew more about leveraged inverse ETFs. I think I bought at around 18? Wasn't that long ago. At one point it was up 10% or so I thought about selling. Wish I had. Its bounced back a little and I think I may make most of it back at some point. Commercial real estate will crash I think. But how its reflected in the market, who knows?

It's clear that inverse ETFs are bullshoots!

I'll play here.

15% stocks in my company retirement.

5% energy related stocks and a few blue chips (ko, jnj).

5% physical and paper gold

20% bonds (tax free munis, tips and ibonds at treasury direct and some long dated corporate).

2% negatively correlated lunatic losing money all the time plays

The rest is cash: CDs laddered to no further than 18 months, money market, interest checking, 3 month treasuries and brokerage cash that I use to jump in and out of commodities.

Waiting for the "inevitable" drop in gold so I can buy more physical gold.

Not very itulipie.

[flintlock]

Re: HOW ONE iTuliper IS INVESTED?

FL and ASH good luck to both of you. I got burned really bad on SRS. Everything I see, read and hear about real estate says r.e. has more to go down especially commercial. I live in the western suburbs of chigago, I would estimate that 20 - 30% of retail property is vacant. There are also a lot of space available signs on office towers around me.

I bought SRS at 35, watched it go down to 22 on July 10. Went on vacation for a few weeks and boom its down to 11. IYR went up 35% in three weeks. wth?? Now if IYR returns to its 7/10, price SRS most likely moves to around 18. So I'm out $4.00 a share even with IYR moving back to the 7/10 price.

Anyhow, this thing has scared me off of reverse etf's. I still own SRS at 13 today. I'm writing agressive OTM calls on it. I think if I'm called out, I'm out. I only had 3% of my money in it fortunately. Thanks to itulip, and a few other contrarian web sites I pulled most of my money out before sept 2008. So i'm smarting over my 2% loss of capital.

I would not be surprised if there is some behind the scenes game going between the fed, treasury, banks, foreign central banks etc propping up the stock market in an attemp to boost consumer sentiment.

Yeah I bought a little SRS before I knew more about leveraged inverse ETFs. I think I bought at around 18? Wasn't that long ago. At one point it was up 10% or so I thought about selling. Wish I had. Its bounced back a little and I think I may make most of it back at some point. Commercial real estate will crash I think. But how its reflected in the market, who knows?

[ax]

Re: HOW ONE iTuliper IS INVESTED?

charliebrown, I got burned on SRS and FAZ myself. In short -- any daily leveraged ETF (if you see some like "returns 200% of the *daily* change in the underlying index") is only for short-term (days at best) usage. I learned this the hard way, sounds like you did too.

Mr. Market is a harsh teacher.

Given the uncertainties in this market, unless I'm completely sure on a stock, I use options now.

I've Dec 2009 FXI 40 puts and Dec 2009 SPY 95 puts to start. I'll see how those do and followup as I dare.

I'm still kicking myself for not shorting EJ when I had the chance. Down about 15%.

I like the timing of your picks. I will probably short similar ETFs, just much further out of the money, once we go past Aug. expiration. I'm also looking to short a regional banks, such as RF or Synovus. RF got downgraded today after it's recent 50% rise.