Hi Corrad and anyone else who cares to listen RE Leveraged Funds
Just say No !
1) Are you an investor or a gambler
If you are a gambler then leveraged funds, options, Forex, and any other kind of dirivative is for you.
When I tell people about how I invest I tell them I want to own certain investments to be diversified and I do NOT care how they do. I want to own those assets no matter how they do. I will vary how much I own of each asset depending on how they do though.
2) The broker you are buying a leveraged fund from has NOTHING to do with the operation of the fund. When Clive says there is some borrowing of some money to do the leverage it would be the fund doing that. ( I am not sure that is what is going on. I would think they would be using options / futures but the exact mechanics don't matter)
3) These funds don't track the underlying security in a way that is very nasty to a long term investor.I would think buying puts could be profitable on almost any "long" leveraged fund and even more so on the inverse funds (if bought at the proper time)
Toofuzzy
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