Buy and Sell Signals, and Other Market Perspectives Message Board

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Strategies & Market Trends : Buy and Sell Signals, and Other Market Perspectives

SPY 695.41

+0.5%

Feb 2 4:00 PM EST

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To: Hank Scorpio who wrote (222767)	2/2/2026 3:23:49 PM
From: GROUND ZERO™	1 Recommendation Recommended By Hank Scorpio Read Replies (1) of 222809

You divide the SLV price by the AGQ price and then since the AGQ is a 2X you then divide again by 2... With a 1X and a 3X then you would then divide by 3... This gives you the ratio for a perfectly balanced spread... The number was something like .235, so I rounded it up to .25, this means 1 to a .25 ratio... You're very welcome, this kind of spread between a 1X and 2X or 3X instrument is ideal since it makes money in both directions... Why does it work??? The 1x moves at the same speed going up or down... The 2X and 3X accelerates higher and decelerates lower, so in a rising market you make the profit from the 2X or 3X instrument... If the market goes down then you make the profit from the 1X instrument... It's very simple and yet I've never seen this kind of spread ever mentioned anywhere... It's just about risk free and it makes money no matter what... Calculated the idea ration, put the spread on, and then go on vacation for 6 months... Come back and you have a profit no matter what the market did while you were away... Shorting a 1X also requires that you pay out the dividends when they come due, but the SLV has no dividends, so this makes it much simpler... Glad to be of some help... Also, at any time while in that spread, you could always take some of the profits off the table and rebalance again, this keep the spread working for you if/when you think the market is about to turn around... I've been using this method for many years and have been making great gains, I only rarely take a net long position these days since the spread strategy has just about zero risk and does as well without losing any sleep at night... GZ

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