Profunds index and sector trading

[was Steve]

i monitor this every day. i agree there are days where the 2x doesnt match up too well. i dont follow the 1x at all so i dont know how they do relative to the ndx. what i will say is generally the 2x funds are pretty close to the 2x factor. on days wehn it is skewed by more than .8% it is usally made up the next day. on thurs the 2x fund gained .13% more than twice the ndx. on following day it earned .13% less than 2x the ndx. you have the data and can verify this. but what i have noticed is it if there is an outlier then it is corrected the next day.

that said if most of your trades are less than 100% there is no need to get involved with the 2x funds. what really messes up the 2x is the multiplication factor as the index gyrates up and down.

should you plug in the past data for ndx and 1x and 2x funds into a spreadsheet and look at the cumulative deviation for the 1x and 2x from the ndx i dont think the difference is significant. it has to be looked at for one day incerments as the compounding skews things.