Shorting SPY for fun and profit. Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Shorting SPY for fun and profit.

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Pancho Villa who wrote (49)	11/8/1997 2:44:00 PM
From: Premier	Read Replies (1) of 346

Pancho, First on .18% cost. SPDR(SPY) is 25 year trust and pays quarterly dividends. A new trust is created at moments notice as demand requires. .18% is the annual cost of maintaining the trust. NAV of the trust is somewhere in between the bid and ask spread. Short term trader is not materially affected by .18%. I have successfully used SPY, MDY, WEBS and a mutual fund RYNVX/RYOCX. A variation to active management of indexing could be as follows: When federal model suggests fair value invest in RYNVX. When federal model suggests undervaluation invest in RYNVX on margin, increase margin @10% rate. If S&P is undervalued by 10% use 10% margin, if S&P is undervalued by 20% increase margin to 20%, etc. When federal model suggests 10% overvaluation switch to SPY. As overvaluation increases switch to cash in 1 to 5 ratio. At 30% overvaluation you will be in all cash and short SPY startegy may begin. This is based on belief that DJ will be 30,000 in year 2010 and it will take a zig-zag path to that number. The startegy outlined above will easily beat S&P and is least expensive. Comments welcom. Regards Premier

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next