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Pastimes : The Justa and Lars Honors Bob Brinker Investment Club Thread -- Ignore unavailable to you. Want to Upgrade?

To: set who wrote (598)	7/31/2000 5:42:31 AM
From: Dave Shares	Read Replies (1) \| Respond to of 10065

Set, Your example illustrates the math. I am not sure that time matters. Take that example, and extend the moves so that the 50% down in the index occurs over a longer period of time, and the 25% up occurs over a longer period of time, and I think you will still see USPIX underperform. I am simply pointing out the math of a 2x fund. But if you are good enough to catch a straight move down, then the 2x fund is optimal, no doubt about it. The key is to take the profit and run and not be greedy, because a countermove will hurt the return obviously. The longer you hold, the less the chance of a straight move in any one direction. Gersh, because of this, if I were going to buy and hold short, yes, a 1x short fund would probably be better, or short QQQ (assuming you have a margin account). I think we've beaten this to death. Good luck, and best wishes always, David