Good luck Lady!
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Good luck Lady!
I asked Tom, our MB administrator if we should keep posting by subject matter or if we might think about a 'home' area for each member to post his/her moves. And the next time I visited the MB, Tom had created this thread for me. Is he a proactive administrator or what! :nuts:
So as I've already stated elsewhere in the MB, my current itty bitty holdings are XLV, SLV, MOO, DBP, QQQQ and XLK in an eTrade account. I'm not going to make many changes until I get my Scottrade IRA up and running. I'll do that just as soon as I get my 2008 tax stuff finalized. And that's just a little complicated! :rolleyes:
I might as well explain how complicated my taxes are by way of introduction. I'm a former government employee who took a disability retirement in 2008 because I have a very rare and painful degenerative medical condition. I also have a very rare and arcane skill set, so my government agency coaxed me back to work as a government contractor, working a few hours here and there as I can and getting paid obscenely well for it! :bigsmile: My work requires travel at times, when I'm able to, as well. Lots of tax complications in that picture. :wacko:
So that's my story. And here's my home. I'll try to keep it comfortable, with big soft couches and plenty of cold drinks in the fridge. So please stop in anytime for a visit. I'd love to have the company!
Lady
Notice the $10,000 I added to your top post? Go for it! :)
Guess what? Like the IRS, I'm taking it back. :)
We are going to wait on the totals and returns for now while we work out the details.
Let's just post the trades, buy / sell with time and prices etc., but posting anything else is just voluntary.
ROFL! After dealing with TurboTax all day that one was a real gut-buster! :nuts:
I was wondering how we were going to do the account reporting.... I'll think about it in my next 3 AM board meeting* and see if I can come up with any suggestions - maybe some kind of XL spreadsheet.
Lady
*3 AM Board Meeting: those middle of the night times when you can't sleep so you lie there having a board meeting with all the voices in your head. :wacko:
Lady, I like your home. :) It feels as comfortable as your other one. Looking forward to your views and insight. JB
This is my 101st post in Tom's new world. Great place! I'm learning lots and making money - what a lovely combination. :bigsmile: :bigsmile: :bigsmile:
{signs 'from my heart'*} Thanks Tom!
Lady
*For those of you who might be unfamiliar with The American Sign Language gesture meaning thank you, a person places his/her palm over the heart and then makes a sweeping gesture, palm up, away from the body, thus "from my heart." It is a gesture I use in my posts to mean most sincere thanks.
I think we are learning more from you Lady. Your research and posted info have been excellent. Thanks!
You're welcome. :embarrest:
Lady
My core positions are:
GDX, because that is where the bull market is right now; :)
SLV, because if a precious metal has more room to run it's silver; :bigsmile: and
MOO, as much because I love the symbol as because we're selling fertilizer to China. :embarrest:
This morning I sold everything else I had and threw it all into SRS with a tight trailing stop. So far it's working okay. We'll see how I feel about this trade at the end of the day .... :unsure:
Lady
Well, my trailing stop on SRS just triggered. I bought it at $64.95 with a 3% trailing stop and I sold at $66.08. Probably should have set my stop tighter, but I made a fair sum and I'm happy. :bigsmile:
Also took an intermediate position in XBI, the biotech SPDR, just now.
Lady
Nice job!
I just bought some XLF at $8.08. I know, I know .... :rolleyes: But I'm hoping for a rebound tomorrow. We'll see if I hate this trade!
Lady
While I was messing around trying to find out more about the GOE ETN today it just kept going up. It closed up 99.4% today. :eek:
Woulda, shoulda, coulda. :rolleyes:
Lady
What the? If it can just do that everyday, we can retire next week. :D (Not that I own any)
I started wondering more about ETNs after what the GOE ETN did this week. And I found this article that explains it. Not sure where else to put it, so I'm hoping that if I post it here people can find it by searching on the word "ETN" if they're looking.
http://news.morningstar.com/articlen...aspx?id=272009
Our New ETN Outlook http://im.morningstar.com/im/dot_clear.gif01-22-09
"Just last week, I titled an article "ETN Risk Rears Its Ugly Head." If only I had known that I would want to reuse that title so soon. Bank stocks are plummeting once again, but this time three particular banks concern our ETF team:
Deutsche Bank (DBDB),
Barclays (BCSBCS), and
State Street (STTSTT). My colleague Paul Justice already addressed the concerns of investors in SPDRs and iShares ETFs in his article on Tuesday, but I wish to expand upon the implications of the recent market movements for investors in ETNs such as the iPath series or the PowerShares commodities ETNs, backed by Barclays and Deutsche Bank, respectively.
For those who have not read Paul's article, it says, in short, that ETF shareholders do not need to worry even if the bank managing their funds goes under. Exchange-traded funds, like traditional open-end mutual funds, are legally set up as trusts separate from the bank corporations. The assets within these trusts cannot be touched during bankruptcy proceedings, as they belong wholly to the shareholders of the fund. We also remain unconcerned that bankruptcy might disrupt the ETF management, hurting the funds' index tracking. Not only do companies generally remain operating through bankruptcy proceedings in order to unwind their businesses in an orderly fashion, but the asset-management side of these banks (Barclays Global Investors and State Street Global Advisors) would be among the most sought-after acquisitions in any post-bankruptcy asset sales. In the worst-case scenario, the parent company may change, but the SPDRs and iShares funds are simply too valuable for potential owners to risk capital flight through poor management.
Investors in ETNs are not so fortunate. These exchange-traded products track a variety of otherwise-inaccessible investments and provide handy tax benefits for any higher-turnover strategies. These benefits pushed ETNs into a dominant position among commodities funds, where the ETF alternatives tend to be set up as partnerships and require fairly complicated tax accounting. However, these products do not have a claim on a separate trust of assets but instead are debt instruments issued by the backing bank and redeemable on a daily or weekly basis for the value of a promised index return minus expenses. Those seeking a more in-depth explanation of the ETN structure should read this recent article by John Gabriel. In summary, ETNs eliminate tracking error on the underlying instrument and simplify taxes, but they expose shareholders to the credit risk of the backing bank. If the bank declares bankruptcy, shareholders in an ETN have to queue up along with all the other debtholders to try to claim their share of the company's assets.
Normally this credit risk appears negligible, especially given the liquidity and frequent redemptions allowed with ETN shares. However, when shares in Deutsche Bank and Barclays have fallen around 80% in the past year and the bankruptcy of Lehman Brothers remains fresh in every investor's mind, bank credit risk seems very worthy of consideration. Even if we take for granted that shareholders can pull all their assets out of an ETN before the bank collapses entirely, there still remains the disruption of having to liquidate an investment position in an emergency situation, with possible adverse tax consequences or difficulty finding a new position to fill the same place in an asset allocation. This concern does not necessarily justify selling out of any ETN stakes right now, but it certainly should push investors to consider alternatives in case their fund's backing bank should grow wobblier.
Investors in the Deutsche-Bank-backed series of PowerShares ETNs are particularly lucky when looking for ETF alternatives. Those content with a single-long position in a given Deutsche Bank commodity index can find an exact equivalent among the PowerShares ETF lineup. For those who used PowerShares ETNs to get leveraged or short commodity exposure, ProShares just issued a lineup of double-long and double-short commodities ETFs based on the DJ-AIG broad index as well as crude oil, gold, and silver funds. Of course, we must list our normal caveats for leveraged and short ETFs: These funds are extremely tax-inefficient because of the short-term instruments they use, and their compounded returns tend to drastically underperform the benchmark over long periods due to volatility drag and the effects of constant leverage. The former provides reason to stay in the ETN so long as Deutsche Bank appears fairly solvent, while the latter warning applies to all leveraged and short funds.
...
So long as the U.S. and U.K. governments wish to avoid another complete collapse like that caused by the Lehman Brothers bankruptcy, ETN shareholders can rest a little easier. Just keep an eye on the news, and always have a potential replacement in mind."
Good stuff for me to remember.
Lady
I bought UCO at $6.00 and GTU at $42.59 today. I was so busy looking at UCO timeframes on the charts to judge the trade and a buy-in price that I forgot to get GTU at the open. And it cost me about $.40 a share. :embarrest:
Thanks to Show-me and Tom for the heads up on UCO. I hadn't seen that one coming! :bigsmile:
Lady
I bought the GOE Gold Index ETN yesterday at $31.75 and it promptly fell by about 12%. :sick: I felt so dumb that I didn't even want to post the trade. Now today it's at $35.96 and rising. :eek:
This one is so volatile that I can't decide where to put my stops! :rolleyes:
Lady
What a rollercoaster. A physical stop doesn't seem practical. They will probably hit it eventually. I'd use a mental stop and if hit, watch for a good place to exit (next rebound, for example).
That's good advice. Thanks for taking the time to share it! I think I'm glad my GOE gold index ETN is a relatively small position in my account!
Lady
My GOE gold ETN is going wacko to the upside again today. It has a 30% trailing stop on it and the stop is above my purchase price. :bigsmile:
My MOO agriculture stock (quit grinning, Tom!) has just about reached my mental stop. Although I think it still has good prospects in the intermediate term, for the short term I'm thinking seriously of selling it and researching an agriculture short. ADZ is a short that's doing well but it's an ETN, and I'm going to try to stick with an ETF.
Right now most of my account is in precious metals one way or the other, and today I'm glad. :)
Lady
That GOE is something else. Who needs Vegas? :D
While I was doing my weekend research yesterday, I found a handy ETF Screener site. It is a sub-page of the http://www.etftrends.com/ site, which is rapidly becoming one of my go-to sites for finding ETF information.
The ETF Screener is at http://www.etftrends.com/etf-tools/etf-analyzer/
I don't know if any of you have used it yet, but I thought the site was my little gem find for the day! :)
Lady
When I was looking over the charts last weekend and saw how hard the indexes were riding the bottom Bollinger Bands, I decided to do a Bollinger Band crash trade yesterday. So I bought TNA at the open yesterday morning and got stopped out immediately. I was so sure of the trade that I bought it again and then got stopped out again! :sick:
Now one of my paid subscriptions says he's buying TNA and FAS this morning on a Bollinger Band crash trade because there is a 95% probability of it being a good one. And Quantifiable Edges has a whole column about why that should be a good bet:
Another Study Suggesting A Short-term Bounce
"Monday marked the 5th day in a row that the S&P 500 closed below its lower Bollinger Band (20 period, 2 std dev). Looking back to 1960 I found only 23 other occurrences. Of those, 22 managed to close higher than the trigger-day close at some point in the next 3 days.
Unfortunately, as you can see from the table below, the edge has been very short-term:
http://2.bp.blogspot.com/_931wANibTq...2-24+png+1.PNG
As this selloff has worsened more and more evidence is suggesting a bounce is well overdue. To this point, though, the bounce has evaded us. I expect it shouldn’t be too much longer until we see it."
http://quantifiableedges.blogspot.com/
So the technicals say that it really SHOULD be a good trade. And my subscriber email and a very good blogspot are confirming it. But I keep thinking about the old saying about "the markets can remain irrational longer than you can remain solvent." :rolleyes: At this point I don't know whether to try a third time or not. {sigh} I'm thinking about going in again but with a small position and NO stops. (I'm developing a love/hate relationship with stops, mostly "hate.") :toung:
Lady
So take the money and run, huh? That's my plan with most long positions right now.
I'm in TNA again @ $17.13. :rolleyes: No stops yet. I'm watching ....
Lady
I put a 4% trailing stop on my TNA. Will probably get stopped out for a third time. Then I'm done with bull index funds. It will be all bear from here anyway. Bought SDS (the S&P 3x bear) at $94.87 and it's down right now but I'm holding it without a stop. It will be up before the end of the week ... maybe ....
I bought more GTU (gold trust) and SLV (silver trust) today. Should have bought more of that nutty GOE (gold ETN) today too because it has taken off to the upside again. That thing is like a roller coaster!
Lady
You bought both TNA (3 x long small caps) and SDS (2 x short S&P) this morning?
Go GOE! It has been amazing. I have no position but I've been rooting for you. :)
I see. It makes sense. I "try" to do that with futures, saying I will short one or two ES contracts for the intermiediate-term looking for lower prices months down the road, while at the same time trade other contracts, long and short, in the short-term. I can't always seem to stick to that plan (like I wrote about in the TSP Comments today). I get too tempted to cover shorts when I see a short-term bullish set up. I need to work on that because believe the big money is made in the intermediate to longer term positions. I watch a lot of Oscar's videos and he's such a scalper that he talks me out of holding anything.
Okay, stopped out on TNA. Third time's done. I'm a slow learner. Bought TZA at $77.54. Will try going with the long term trend instead of against it this time! :rolleyes:
Still thinking about the problem of holding leveraged ETFs for more than a day. Haven't come up with a brilliant solution yet. :toung:
Lady
Today I'm really feeling like a slow learner. I paper traded ETFs until I was pretty confident in my abilities before I started to trade with more than monopoly money. But today I found out that I need to go back to all my investment books and review "Entry and Exit Points 101." :embarrest:
I'm happy with every stock that I have right now, but some of my entry points are really the pits! :sick:
Lady
I am envious of that trade. Great job!
That's amazing how some trades look like a person made a mistake....Then wham...an amazing return.
Option trading has those big swings, but the potential return is phenomenol. It is always an adrenalin rush when the option go into the money$$$. If we get a run up in the S&P, I am going to buy some call options on SDS for the next market drop.