No, that's not true about BEARX. The fund does a very good job tracking inversely the stock averages. It has more or less equal short positions in 80 to a hundred stocks that Tice, the manager, has tried to pick as overvalued, and therefore provides protection against the calamity of a runaway on the upside of a single stock. It's cheap to get in and out of. Even in an IRA, Quick and Reilly charges only a $25 commission for any size trade, and the fund itself is no-load. The expenses are higher than some funds because it is actively managed and has more commissions, fees, interest costs, etc than some.
But if you look at this chart you will see what I mean about how it behaves. Of course, my reasoning is that in fact we should soon either enter or confirm a bear market. I consider it a 1-2 year commitment, planning to move into cash in stages if the market declines, and then back into stocks. Supposedly BEARX will also change its investment mix, but I am not counting on that.
Check this chart:
tscn.com
If the market doesn't decline or goes up, well, I will sit there unhappily but I won't get any margin calls. |
