[quote=peterb]Next big overhead is 10000. If it get anywhere in the high 9000’s, I’m loading up on the new triple short ETF’s out there.[/quote]
I would stay away from the 3x ETF’s for several reasons.
*Liquidity & b/a spreads
*2x funds can suffer poor correlation over weeks & months, with high volatility exacerbating this. E.g. – SDS (2x short SP500) is up 35% over the last 3 months, and the SP is down 30%, which is not even close to 2x… I imagine 3x will behave even worse.
*Broker margin can be had for < 2% currently.
*3x leverage is alot, especially with high volatility and surprise events compounding overnight risk.
*If you really want high leverage, and can accept catastrophic loss, then you may want to consider index futures, as these would obviate the first 3 issues. There is a professional futures trader who posts here. He would be an excellent resource to ping.
