Replies to post #398 on ETFs, Leveraged ETFs, Sector Funds

[No-Quarter]

It would be interesting to see what the return would be if the day you sold one you opened up the other. You would get hit by whipsaws but you would get the full ride in both directions instead of waiting for the next buy signal in just one fund.

I'm not sure where I lost you a few days back, but this is exactly what I was trying to describe to you. At the 6 and 10 day cross overs, you sell one, and buy the other. Making money on the way up AND on the way down. The distance between the 6 and the 10 are such that the cross over points 'should' be 3 days apart or greater for transaction settlement so as to avoid any broker 'free ride' infractions.


IF you believe the market prognosticators, their is another 10% plus correction coming late this year, or early next, similar to the one we had in late Jan of this year. If we have this in place before then, we should bank a 3x ~10% gain on the way down, and again on the way back up. A ~60% increase. :)

[No-Quarter]

Using the SOXL:SPXS chart, and 6 day and 10 day crossover points, I come up with the following paper trades for this year;

@the first crossover of the year 30JAN Buy SPXS @ 25.421
16FEB Sell SPXS@27.43 and buy SOXL@160.77 a 7.9% gain on SPXS
20MAR Sell SOXL@184.38 and buy SPXS@27.45 a 14.7% gain on SOXL
13APR Sell SPXS@28.61 and buy SOXL@150.79 a 4.2% gain on SPXS
20 APR Sell SOXL@122.86 and buy SPXS@28.21 a 18.5% loss on SOXL
This is where if I had a stop loss set at 10%, I believe I could have limited the 18.5% loss to 10%, so I will use 10% loss. Having been stopped out I would sit out the market until the next cross over signaled a buy in the opposite ETF
3MAY Sell SPXS@28.78 and buy SOXL@135.83 a 2% gain on SPXS
13JUN Sell SOXL@178.47 and buy SPXS@24.89 a 31.3% gain on SOXL
9JUL Sell SPXS@24.56 and buy SOXL@157.52 a 1% loss on SPXS
14AUG Sell SOXL@149.38 and buy SPXS@23.18 a 5.2% loss

If I used $10,000 with the first buy on 30JAN, then-
16FEB 10,000 + 7.9% = $10,790
20MAR 10,790 + 14.7% = $12,376
13APR 12,376 + 4.2% = $12,895
20APR 12,895 – 10% = $11,606
3MAY 11,606 + 2% = $11,838
13JUN 11,838 + 31.3% = $15,543
9JUL 15,543 – 1% = $15,388
14AUG 15,388 – 5.2% = $14,588

14,588/10,000 = 45.5% increase so far this year.

...and this in a year where letting Surfer run on autopilot would be a flat year so far.

Please look this over carefully. Let me know if you come up with something different.