Buy and Sell Signals, and Other Market Perspectives 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 : Buy and Sell Signals, and Other Market Perspectives

SPY 670.21

-1.1%

4:00 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

Recommended by:

GROUND ZERO™

John Pitera

toccodolce

To: John Pitera who wrote (89603)	2/8/2017 1:45:02 PM
From: Qone0	3 Recommendations Read Replies (1) of 218498

I trade the junior miners GDXJ and its 3x JNUG and JDST. DUST is the 3x inverse of GDX. GDXJ has a little more percentage moves that GDX that's why I trade it instead of GDX and its 3x NUGT and DUST. The funds work the same way in the two. The 3x return is done through swaps with a counter party. They rebalance exposure every day. If the fund is up the previous day they increase exposure the next day. If the fund is down they decrease exposure the next day. In a trend this works to your advantage, as increased exposure increases return. In a up and down flat base this rebalancing decays the price of the 3x fund in relationship to its index. Over time the decay can be massive in a up and down base. This 3x percentage also destroys the inverse 3x more than bull 3x because the percentage up is always more than the percentage down. Price point to price point in the index. So the inverse fund will never return the same percentage as the bull fund.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next