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Registered User
Joined: 12/8/2004
Posts: 1,301
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Some new ETF's have come onto the market over the last week. They are called proshares. It is a very interesting concept. Do a search for proshares in your telechart stock search and you will see the whole line up.
Do you think the nasdaq has more room to move down then either buy PSQ or QID. PSQ moves point for point with the nasdaq 100. QID moves 2 points for every one point in the nasdaq 100.
They have short and long etf's for all of the major indexes. If the name has ultra in it then the fund moves 2 points for every one point of the underlying index.
It would seem to me trading these type of funds would work great in choppy markets, or in markets where you know you have a good elliott wave count. It sure keeps the stock scanning to a minimum as well. Of course you lose the joy in finding that diamond in the rough, but it would seem to me that it is much easier to see where the overall market is headed than it is for individual stocks, and you don't have to worry about earnings reports.
Any thoughts?
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Registered User
Joined: 3/25/2005
Posts: 67
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If you can handle the volatility, including intratrade drawdowns, they could be great. Leverage cuts both ways, of course.
I'm inclined to think that choppy markets are the type of environment that i wouldn't want to trade these. If they act like their open-end bretheren, you lose a little beta in both directions because of fees. Over a period, if the index is flat, you lose money - and not inconsequential percentages (although i don't know the exact figures). The way these instruments are structured, "the juice" might not be as severe.
I won't touch 'em until i see enough history to have a feel for their true beta. Just my opinion.
JG
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Registered User
Joined: 1/28/2005
Posts: 6,049
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I think its great. From the business point of view they are just coping the
new style mutual funds that are out there. I'm sure the popularity of specialty
funds(mutual funds) is what has lead to the new ETF's.
The way I see it the fact that stock traders can now also access short
ETF's., leverage,gold,commodities,currencies can only be a plus.
Not to mention things like Brazil,Canada, Australia and so on.
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Registered User
Joined: 10/7/2004
Posts: 2,126
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If you want to trade real volatility - then trade futures. It is as simple as that. And you don't have to worry there about the uptick rule to short, which I do not think is a great deal in equities anyways.
good luck
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Registered User
Joined: 10/7/2004
Posts: 82
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There is no uptick rule for ETF's either. ETF's are better than mutual funds because of the opportunity to trade them throughout the trading day rather than wait for specific times in the day.
I trade GLD (gold), SLV (silver), and USO (oil) as a hedge for my portfolio. I'm looking to add a bond ETF (either SNY or TLT) as a further hedge to the portfolio.
Some ETF's are a little strange though: FPX, for example, trades IPO's from Day 3 to Day 1,000. That's a little too specific for my tastes.
~Bob
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Registered User
Joined: 3/1/2006
Posts: 5
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I found the ProShares in TeleScan but there are no stocks in any of them. Anyone no why?
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Registered User
Joined: 10/7/2004
Posts: 82
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I'm not sure what TeleScan is but ProShares are ETF's; not stocks. If you type "proshares" into the company name search box on the Jump dialog box in TeleChart you'll see the complete list of ProShares ETF's.
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