HOW ONE iTuliper IS INVESTED?

[flintlock]

Re: HOW ONE iTuliper IS INVESTED?

That speculative position from May was to go long EEV via a December 25th-dated call. In retrospect, it would have been better to buy puts against a long ETF than calls for a short ETF. Live and learn. In any case, this position has lost about 80% of its value. I'm staying in because this was always a play on a market crash by the end of the calendar year. The concept was to select as volatile a security as I could find, and wait for it to react to the realization that the world's economic problems aren't over. If that happens by the end of the year, I may yet make a profit... not that I'm holding my breath.

Today, I opened a larger speculative position against the S&P500. Steveaustin2006 pointed out that the leveraged short ETF SPXU was fairly newly-minted, and I thought it fit the bill to play a market downturn this fall. I entered with about 5% of my net worth. This will probably be the tuition I pay to learn not to futz around with leveraged ETFs anymore.

As of today, I am 10% cash, 5% speculation short the market, and 85% precious metals. The shift from my earlier 80/20 allocation between PM and cash is the result of opening the speculative position and a change in metal prices since my last post to this thread.

I plan to shift another 5% out of cash and into non-leveraged long-dated emerging markets puts shortly. So, when the market shoots skyward instead of cratering, this will be my opportunity to lose 10% of net worth.

I bought SPXU yesterday with some of my play money. Here's hoping this one works out better for you( and me!).

[cjppjc]

Re: HOW ONE iTuliper IS INVESTED?

Got stopped out of PST a few days ago. Hard to believe. I'm about to put stops on the minors soon.:eek:

I can't imagine a life without mining stocks.

[charliebrown]

Re: HOW ONE iTuliper IS INVESTED?

FL and ASH good luck to both of you. I got burned really bad on SRS. Everything I see, read and hear about real estate says r.e. has more to go down especially commercial. I live in the western suburbs of chigago, I would estimate that 20 - 30% of retail property is vacant. There are also a lot of space available signs on office towers around me.

I bought SRS at 35, watched it go down to 22 on July 10. Went on vacation for a few weeks and boom its down to 11. IYR went up 35% in three weeks. wth?? Now if IYR returns to its 7/10, price SRS most likely moves to around 18. So I'm out $4.00 a share even with IYR moving back to the 7/10 price.

Anyhow, this thing has scared me off of reverse etf's. I still own SRS at 13 today. I'm writing agressive OTM calls on it. I think if I'm called out, I'm out. I only had 3% of my money in it fortunately. Thanks to itulip, and a few other contrarian web sites I pulled most of my money out before sept 2008. So i'm smarting over my 2% loss of capital.

I would not be surprised if there is some behind the scenes game going between the fed, treasury, banks, foreign central banks etc propping up the stock market in an attemp to boost consumer sentiment.

[jpatter666]

Re: HOW ONE iTuliper IS INVESTED?

charliebrown, I got burned on SRS and FAZ myself. In short -- any daily leveraged ETF (if you see some like "returns 200% of the *daily* change in the underlying index") is only for short-term (days at best) usage. I learned this the hard way, sounds like you did too.

Mr. Market is a harsh teacher.

Given the uncertainties in this market, unless I'm completely sure on a stock, I use options now.

I've Dec 2009 FXI 40 puts and Dec 2009 SPY 95 puts to start. I'll see how those do and followup as I dare.

I'm still kicking myself for not shorting EJ when I had the chance. Down about 15%.

[ax]

Re: HOW ONE iTuliper IS INVESTED?

charliebrown, I got burned on SRS and FAZ myself. In short -- any daily leveraged ETF (if you see some like "returns 200% of the *daily* change in the underlying index") is only for short-term (days at best) usage. I learned this the hard way, sounds like you did too.

Mr. Market is a harsh teacher.

Given the uncertainties in this market, unless I'm completely sure on a stock, I use options now.

I've Dec 2009 FXI 40 puts and Dec 2009 SPY 95 puts to start. I'll see how those do and followup as I dare.

I'm still kicking myself for not shorting EJ when I had the chance. Down about 15%.

I like the timing of your picks. I will probably short similar ETFs, just much further out of the money, once we go past Aug. expiration. I'm also looking to short a regional banks, such as RF or Synovus. RF got downgraded today after it's recent 50% rise.

[flintlock]

Re: HOW ONE iTuliper IS INVESTED?

FL and ASH good luck to both of you. I got burned really bad on SRS. Everything I see, read and hear about real estate says r.e. has more to go down especially commercial. I live in the western suburbs of chigago, I would estimate that 20 - 30% of retail property is vacant. There are also a lot of space available signs on office towers around me.

I bought SRS at 35, watched it go down to 22 on July 10. Went on vacation for a few weeks and boom its down to 11. IYR went up 35% in three weeks. wth?? Now if IYR returns to its 7/10, price SRS most likely moves to around 18. So I'm out $4.00 a share even with IYR moving back to the 7/10 price.

Anyhow, this thing has scared me off of reverse etf's. I still own SRS at 13 today. I'm writing agressive OTM calls on it. I think if I'm called out, I'm out. I only had 3% of my money in it fortunately. Thanks to itulip, and a few other contrarian web sites I pulled most of my money out before sept 2008. So i'm smarting over my 2% loss of capital.

I would not be surprised if there is some behind the scenes game going between the fed, treasury, banks, foreign central banks etc propping up the stock market in an attemp to boost consumer sentiment.

Yeah I bought a little SRS before I knew more about leveraged inverse ETFs. I think I bought at around 18? Wasn't that long ago. At one point it was up 10% or so I thought about selling. Wish I had. Its bounced back a little and I think I may make most of it back at some point. Commercial real estate will crash I think. But how its reflected in the market, who knows?

[goadam1]

Re: HOW ONE iTuliper IS INVESTED?

Yeah I bought a little SRS before I knew more about leveraged inverse ETFs. I think I bought at around 18? Wasn't that long ago. At one point it was up 10% or so I thought about selling. Wish I had. Its bounced back a little and I think I may make most of it back at some point. Commercial real estate will crash I think. But how its reflected in the market, who knows?

It's clear that inverse ETFs are bullshoots!

I'll play here.

15% stocks in my company retirement.

5% energy related stocks and a few blue chips (ko, jnj).

5% physical and paper gold

20% bonds (tax free munis, tips and ibonds at treasury direct and some long dated corporate).

2% negatively correlated lunatic losing money all the time plays

The rest is cash: CDs laddered to no further than 18 months, money market, interest checking, 3 month treasuries and brokerage cash that I use to jump in and out of commodities.

Waiting for the "inevitable" drop in gold so I can buy more physical gold.

Not very itulipie.

[LargoWinch]

Re: HOW ONE iTuliper IS INVESTED?

Below is where I sit right now.

I am up just shy of 1% overall this year due to my cash returns offset by overall unsuccessful speculative plays with HNU and HOU.

I would follow Dumbass and CharlieBrown lead with NG, but given EJ's latest research on China [as well as GRG55 recent comments], I am certainly not prepared to go long with a leveraged ETF.

Cash	57.0%
Gold	26.7%
Silver	8.6%
Platinum	6.8%
Palladium	0.8%
Total:	100.0%

My speculative money is 5% of the total. I cannot decide what to do with it, but I am sure Finster, bart and icm63 will have some suggestions ;).

[goadam1]

Re: HOW ONE iTuliper IS INVESTED?

Below is where I sit right now.

I am up just shy of 1% overall this year due to my cash returns offset by overall unsuccessful speculative plays with HNU and HOU.

I would follow Dumbass and CharlieBrown lead with NG, but given EJ's latest research on China [as well as GRG55 recent comments], I am certainly not prepared to go long with a leveraged ETF.

Cash	57.0%
Gold	26.7%
Silver	8.6%
Platinum	6.8%
Palladium	0.8%
Total:	100.0%

My speculative money is 5% of the total. I cannot decide what to do with it, but I am sure Finster, bart and icm63 will have some suggestions ;).

The consensus seems to follow the bouncing ball. You either choose to trade the bounce or sit it out. I'm anxious to get out of some cash but the feedback here is we are in for a little disinflation.

[raja]

Re: HOW ONE iTuliper IS INVESTED?

FL and ASH good luck to both of you. I got burned really bad on SRS. Everything I see, read and hear about real estate says r.e. has more to go down especially commercial. I live in the western suburbs of chigago, I would estimate that 20 - 30% of retail property is vacant. There are also a lot of space available signs on office towers around me.

I bought SRS at 35, watched it go down to 22 on July 10. Went on vacation for a few weeks and boom its down to 11. IYR went up 35% in three weeks. wth?? Now if IYR returns to its 7/10, price SRS most likely moves to around 18. So I'm out $4.00 a share even with IYR moving back to the 7/10 price.

Anyhow, this thing has scared me off of reverse etf's. I still own SRS at 13 today. I'm writing agressive OTM calls on it. I think if I'm called out, I'm out. I only had 3% of my money in it fortunately. Thanks to itulip, and a few other contrarian web sites I pulled most of my money out before sept 2008. So i'm smarting over my 2% loss of capital.

I would not be surprised if there is some behind the scenes game going between the fed, treasury, banks, foreign central banks etc propping up the stock market in an attemp to boost consumer sentiment.

Do you think there is any chance that SRS will have a huge upturn as it has in the past?

I rode SRS down, am very underwater now, and am wondering at what point I should bail out???

[ST]

Re: HOW ONE iTuliper IS INVESTED?

Commercial real estate will crash I think. But how its reflected in the market, who knows?

Maybe puts on KRE? But the problem I see there is long dated puts aren't available so safety is narrow. Thoughts?

[ST]

Re: HOW ONE iTuliper IS INVESTED?

It's clear that inverse ETFs are bullshoots!

2% negatively correlated lunatic losing money all the time plays

gold drop buy more ... Not very itulipie.

1 - yeah, looks that way. It looks like if the etf moves against you initially it only gets harder to get back to square one - timing component is tight.

2 - LOL

3 - yes, me too - not very itulipie but c'est la vie

4 - just wondering in your bond, cd exposure etc... aren't you finding it difficult to beat the liquidity and rate of online only 'high interest' at hsbc, ing etc... totally liquid and circa 1.48% ? or 1.96% at AIG?

[dummass]

Re: HOW ONE iTuliper IS INVESTED?

Do you think there is any chance that SRS will have a huge upturn as it has in the past?

I rode SRS down, am very underwater now, and am wondering at what point I should bail out???

It may help, if you understand the other side of the trade. After the last recession (2001), I made a lot of money buying ICF. Why?

Because CRE benefits from a low interest rate environment. The interest payment, on the mortage, is the greatest expense to a CRE investment. Also, if timed towards the end of the recession, income from CRE will increase in the following ways: 1) occupancy will rise 2) rents will increase and 3) Cap rates will decrease.

This has been the pattern and investors are playing the cycle. What most people don't realize is that this time is different: 1) CRE will not benefit from the near zero percent interest rates, because banks are not lending 2) occupancy will not rise because there will not be an improvement in employment 3) rents will not be going up and 4) Cap rates will trend higher as forclosures continue to weigh on the market.

You can't fight ignorance; it has a numerical advantage.

[charliebrown]

Re: HOW ONE iTuliper IS INVESTED?

well if iyr which is the forward index that srs is based upon goes from 38 (today's price) , to 23 (march low) in one day, then you are looking at an 80% return, so the price will be around $23 (assuming no index tracking error). Now this is not going to happen. I don't understand what would happen to the price of SRS if say IYR went to $23 in 3 months, along a zig-zagging up pattern. Would it still be at $23?

[charliebrown]

Re: HOW ONE iTuliper IS INVESTED?

I read the quarterly report of SPG, the biggest component of IYR. believe it or not they had an increase in rental rates per sq foot on renewing leases, even though the store's sales per sq ft is falling fast. Dang, did they send some mob bosses down to the store's GM? How did they pull that off?