A.I.M. Users Bulletin Board

[lrp42]

Hi Bob,

I was only responding to Tf's post since no one else was doing so. I thought he deserved one in any event. I was probably not the right person to respond to his post. Besides if you look at my follow up post to Tf you will see that I told him I missed his point.

Sorry if I mislead anyone.

You know an awful lot more than I do on this subject so I will let him defer to you.

I was only expressing my opinion about using leveraged inverse ETFs as "long term" investments instead of Cash. With an AIM money management investment strategy I want to be able to depend on a certain amount of dollars in my "cash account" when I need it to make additional stock or fund purchases. I am a very conservative investor and I like things I can depend upon. At the moment Cash is one of those things. Again, I was only expressing my opinion for what its worth.

As far as using "percentages" in my examples. I meant those in a general term to any instrument whose value fluctuates, not just with leveraged inverse ETFs. I am sure most readers understand that. The reason I even used those examples is because there were used by Direxion Funds in some old prospectuses. They used those percentages to show how "Daily" pricing could effect one's expectations. I used to have some of those old prospectuses lying around in the office in my home, but I cleaned them out a couple of years ago. There were a number of "warnings" in those prospectuses.

Also, I recall that one of those warning on its website said these leveraged ETFs were to be used only "sophisticated" investors. I am surely not in that category. Again, I probably should not have responded to Tf.

Below is a link to a page on Direxion's website. It puts SPXS and other leveraged long and inverse ETFs into a category it describes as "SHORT TERM TRADING". IMO, even Direxion does not consider these leveraged ETFs to be used for "long-term investing" ...only for "short-term trading".

http://www.direxionfunds.com/regulatory-documents

With respect to my example using SLW and DSLV. It was only an example I used to show that he might have been better off doing this a year ago than try to and do it now since it seems that silver has lost a lot of value and has been down for several months now.

I guess these were my points to Tf. As I said I probably was not the right person to respond to him.

Best regards,

Ray