Tag Archive for 'TNA'

5 more days

Published on September 23, 2010, 11:40 pm in Trading. Closed Tags: , , , , , , , , .

Yeppers! Only 5 more trading days left in September. That means the 4th quarter starts a week from tomorrow. Have you started your Christmas shopping yet? Well, fund and money managers will need some money to start so watch for a lot of window dressing in the week to come.

My late day yesterday and pre-market oil plays worked out well today. Still holding on to some USO calls and a couple shares of UCO.

I won’t harp on volume …I guess the “new normal” average volume is not about 10-20% less than what I always thought was average volume.

I’m not sure if we have had enough of a pullback….I think so. The S&P, along with the SPY, did close below the August highs. We’ll have to see on Friday if we pop back up through or feel around in the gutter for more. If we do get a down opening, I’ll look to nibble on some Bull ETFs like SPY SSO TNA BGU and the like. Watch out for 2 reports Friday morning: Durable Goods and New Home Sales.

“The National Bureau of Economic Research announced the recession actually ended in 2009. What idiots we were! So that recession you think you’re in, that’s as imaginary as the job you used to have.”

“What they don’t tell you, the next recession started in July of last year.” – Jay Leno

Share

Trading some ETFs

Published on August 26, 2010, 9:33 pm in reading, Tools and Trading. Closed Tags: , , .

I like to daytrade the index ETFs….y’know, TNA/TZA BGU/BGZ SSO/SDS and a multitude of other bull/bear pairs. Depending on how the market is doing, I jump on either the bull or bear ETF and scalp it for as long as all day sometimes….and other times for 60 seconds….sometimes for a profit and other times for a loss. You know how it goes. 8O

As I was watching the grass grow at mid-day today, I was daydreaming at where I would be if I had bought some pairs at the beginning of the year. Logic would be that one side would be up and the other side down. But no!

On January 4th this year, TNA opened at $44.66 and closed today at $33.58, down about 12%. The Russell is down about 4% for the year, and since TNA is a 3X ETF, being off 12% is about right.

So TZA should be up about 12%, right? No! TZA opened the year at $47.05 and closed today at $39.06, down about 15% for the year. What!? The bear ETF is down more than the bull ETF? Yes. So if you had decided to put on some sort of spread bet taking both sides to hedge yourself, you’d be a real loser! :cry:

My lesson here is … not to hold leveraged ETFs for more than a day. Yes I have held overnight and have both profitted and lost on the gamble…. But now just daytrade or scalp….make more money and sleep a whole lot better.

Here’s an article that should be read by anyone trading leveraged ETFs. This study is based on 2X ETFs so the issues are greater in the 3X and 4X ETFs available now. The explanation is a lot more technical than what my daydreaming came up with. How Long Can You Hold Leveraged ETFs?

For all the periods studied except one-year, tracking error grows larger … and more negative … as the expected return grows.
The results of the study are clear. As you move further away from the targeted one-day time period, tracking error on these funds grows.

Share

Friday the 13th

Published on August 12, 2010, 10:40 pm in Opinions and Trading. Closed Tags: , , , .

The low of the day was put in at the open on Thursday, moved up quickly and then just meandered in a narrow range for the rest of the day. Can we have an up day on Friday the 13th? I’m thinking we can and should!

Yesterday I bought TNA afterhours, looking to hold on for a week maybe. Instead I sold at the pre-market open for about 60 cents profit, which was nice. But before the cash markets opened, TNA had dropped precipitously and I got back in and got back out an hour later. Man, that was crazy…and lucky…oh yeah, and profitable!

Speaking of crazy, have you seen NFLX over the past 2 weeks? It’s been going straight up and making new highs today! Judging by that action, the market is thinking everyone is going to be unemployed soon and watching movies from home….confirming the jobless claims and employment reports! :roll:

Tomorrow will start with CPI and retail sales reports. And soon after the open we get Consumer Sentiment. That should make for a wild Friday the 13th. And watch out for black cats and don’t walk under any ladders.

One more thing….Trade what you see not what you think. Here is a funny cartoon video:Trading what you think.    :D

Share