A.I.M. Users Bulletin Board

[lrp42]

I agree with AIMster.

I have purchased these inverse ETFs from time to time with reasonably good success. However, and this needs to be emphasized, these were purchased as short-term trades only to make some quick profits.

And, these ultra-short ETFs were purchased only when the volatility was very mild; unlike what it has been since last fall. If one attempts to buy these in a volatile market he can live to regret his decision.

It is my opinion that these ultra-short inverse ETFs should be purchased only when the market has had a long extended bull run and the VIX has a reading below 13 or so.....a very overbought condition. I have never quite figured out how to post graphs and charts here, but if this link turns out okay you can see how these inverse ETFs would have performed if purchased when the VIX was down in low double digit numbers.

http://stockcharts.com/h-sc/ui?s=$VIX&p=D&yr=2&mn=0&dy=0&id=p23907460159

As AIMster says, the long term bias of the market is upward, so one should not become married to one of these ETFs.

JMHO.

Regards,

Ray