Valuing Fundamentals and Risk in the Drybulk Industry [View article]
I will add VLCCF to my spreadsheet and either add it to the article through an edit, or I will add it here to the comments, over the next several days.
ProShares UltraShort 20+ Year Treasury ETF: Market Insurance From an Inferior Fund? [View article]
Just ask yourself, if you were talking to William Sharpe, what would he tell you? Would he agree with you that it is better to speculate on interest rates and therefore have negative exposure to risk free assets to accompany your market risk?
I don't think so. And because he is the better investor than me, I will use his methods.
Diversification across ALL major asset classes is a tool, not a barrier to earning excess return.
Regardless, even I were to agree with you, my point from my article still stands, even more so in fact. Because you don't want to have the price risk associated with treasuries, you would prefer a substitute risk free asset, whether it be a foreign government's risk free asset or something else, such as puts in TBT.
The asset is better than uncorrelated; it is negatively correlated with market risk.
ProShares UltraShort 20+ Year Treasury ETF: Market Insurance From an Inferior Fund? [View article]
Strange way to make the point... because it is a strange case. And that is the point. Buying puts on TBT is more effective than buying TLT or treasuries is my point.
I am absolutely not going to discuss the belief that treasuries shouldn't be in a portfolio. Having treasuries does NOT reduce risk-adjusted return. End of story.
If you want to speculate which direction treasuries will go, fine by me. I'm not a speculator.
ProShares UltraShort 20+ Year Treasury ETF: Market Insurance From an Inferior Fund? [View article]
I'm not sure you understood the point of my article. My article points out that risk free assets by and large are negatively correlated to market risk, and therefore they are desirable to own. Further, I have provided a way to have access to this market risk insurance even without having much risk.
Having exposure to treasuries doesn't reduce return. That is the point of diversification and why it works.
Investing in the Chinese Yuan: World's Reserve Currency by 2030? [View article]
When will the Bank of China start allowing Americans open accounts in LA? Those exchange traded products are pure garbage and offer no real Yuan exposure.
ProShares UltraShort 20+ Year Treasury ETF: Market Insurance From an Inferior Fund? [View article]
I just don't have much to add about TBF. It is a 1X inverse fund, so the opposite of TLT. It seems TBF still suffers from the decay effect discussed in the article. If you bring up a 2 year chart with TLT and TBF, you can see that TLT is down 3%, not including dividends. Theoretically, TBF should be up 3%, but it isn't. It is down 9%. I'm not sure if this is a result of the fund managers having to pay the dividends on their shorts or if the decay is from derivative market issues, but the same result occurs with TBF thant occurs with TBT that is discussed, only it isn't as much decay with TBF.
Chinese Yuan and the Future of U.S. Exports [View article]
I don't have a solution; I don't need one. I am just explaining what will happen. As our currency gets weaker, we will see our trade deficit shrink, which has already started. We will also see unemployment improve further. You are arguing with yourself at this point, and I'm not sure what about. There just isn't any logical counterargument to what I have said.
You have failed to demonstrate that my argument above isn't 100.00% correct, although I do sense you have some issue of importance to make but have just been able to put it concisely in words.
Chinese Yuan and the Future of U.S. Exports [View article]
You bring up good points, almost too many to address here, but frankly I want the war ended tomorrow and most of the military fired. I feel they are a drain on the country and are better used as defense rather than offense. The 3rd graph shows that the US has become dramatically more competitive as an exporter since Bush started. The dollar fell, but not against the Yuan.
Do you think it is good that the FED is keeping rates at zero? Well, the FED agrees with me that a weak dollar is the only way to allow the US to become competitive again. People are tired of the US. It will take a very weak dollar to encourage companies to finally come all the way back.
If gas becomes more expensive it is good for the US because it forces domestic production and improves net exports. It also stimulates electric vehicle technology.
But I guess the major difference between the US and Germany is Germany isn't burning money on a war.
Check out the Thai economy. It is a great example of what I'm talking about. It had a weak currency for many, many years before the economy finally caught fire. Now it is the fastest growing economy in Asia with unemployment of 1.54%! Thailand is experiencing huge export growth due to the strengthening Yuan. Companies are leaving China and moving to Thailand. South Korea too. They are not coming to the US yet because the dollar is still to high, but they are no longer leaving. Look at the plants Honda has built over the last decade in the US to diversify away from the strengthening Yen.
Chinese Yuan and the Future of U.S. Exports [View article]
I am sticking to my original argument, but the underlying cause of the entire financial crisis wasn't AIG or any other financial company. That was the effect. The cause was Americans didn't have legit jobs or income due to the mass exodus out of the United States and into China. Small businesses were closing due to shoppers only shopping at Walmart. The financial collapse couldn't have occurred if the Yuan strengthened two years sooner because rising net exports would have supported the job market. Just facts.
If you look, the Chinese government forced the Yuan to begin strengthening well before the financial crisis; but the currency effect is so delayed it was just a little bit too late. That is why we are finally starting to feel the effects now.
The soybeans make perfect sense to me. Chinese like soybeans. I bet rice is high on the list as well. If this would have happened 3 years sooner, the Great Financial Crisis would have been only a mild recession.
If I'm wrong, I'm wrong. But if I'm right, I'm right. I like my odds.
Chinese Yuan and the Future of U.S. Exports [View article]
If the US didn't lose millions of jobs, there would have been ZERO write downs in the financial sector.
The financial sector problems were just an effect from lack of exports and too high of imports. Americans cannot consume without producing and have no problems.
Valuing Fundamentals and Risk in the Drybulk Industry [View article]
ProShares UltraShort 20+ Year Treasury ETF: Market Insurance From an Inferior Fund? [View article]
I don't think so. And because he is the better investor than me, I will use his methods.
Diversification across ALL major asset classes is a tool, not a barrier to earning excess return.
Regardless, even I were to agree with you, my point from my article still stands, even more so in fact. Because you don't want to have the price risk associated with treasuries, you would prefer a substitute risk free asset, whether it be a foreign government's risk free asset or something else, such as puts in TBT.
The asset is better than uncorrelated; it is negatively correlated with market risk.
Good luck.
ProShares UltraShort 20+ Year Treasury ETF: Market Insurance From an Inferior Fund? [View article]
I am absolutely not going to discuss the belief that treasuries shouldn't be in a portfolio. Having treasuries does NOT reduce risk-adjusted return. End of story.
If you want to speculate which direction treasuries will go, fine by me. I'm not a speculator.
ProShares UltraShort 20+ Year Treasury ETF: Market Insurance From an Inferior Fund? [View article]
Having exposure to treasuries doesn't reduce return. That is the point of diversification and why it works.
Trading DRYS Using Multi-Factor Capital Asset Pricing Model [View article]
Investing in the Chinese Yuan: World's Reserve Currency by 2030? [View article]
ProShares UltraShort 20+ Year Treasury ETF: Market Insurance From an Inferior Fund? [View article]
ProShares UltraShort 20+ Year Treasury ETF: Market Insurance From an Inferior Fund? [View article]
Chinese Yuan and the Future of U.S. Exports [View article]
Chinese Yuan and the Future of U.S. Exports [View article]
You have failed to demonstrate that my argument above isn't 100.00% correct, although I do sense you have some issue of importance to make but have just been able to put it concisely in words.
Chinese Yuan and the Future of U.S. Exports [View article]
Chinese Yuan and the Future of U.S. Exports [View article]
Do you think it is good that the FED is keeping rates at zero? Well, the FED agrees with me that a weak dollar is the only way to allow the US to become competitive again. People are tired of the US. It will take a very weak dollar to encourage companies to finally come all the way back.
If gas becomes more expensive it is good for the US because it forces domestic production and improves net exports. It also stimulates electric vehicle technology.
But I guess the major difference between the US and Germany is Germany isn't burning money on a war.
Check out the Thai economy. It is a great example of what I'm talking about. It had a weak currency for many, many years before the economy finally caught fire. Now it is the fastest growing economy in Asia with unemployment of 1.54%! Thailand is experiencing huge export growth due to the strengthening Yuan. Companies are leaving China and moving to Thailand. South Korea too. They are not coming to the US yet because the dollar is still to high, but they are no longer leaving. Look at the plants Honda has built over the last decade in the US to diversify away from the strengthening Yen.
Good thoughts though.
Chinese Yuan and the Future of U.S. Exports [View article]
If you look, the Chinese government forced the Yuan to begin strengthening well before the financial crisis; but the currency effect is so delayed it was just a little bit too late. That is why we are finally starting to feel the effects now.
The soybeans make perfect sense to me. Chinese like soybeans. I bet rice is high on the list as well. If this would have happened 3 years sooner, the Great Financial Crisis would have been only a mild recession.
If I'm wrong, I'm wrong. But if I'm right, I'm right. I like my odds.
ProShares UltraShort 20+ Year Treasury ETF: Market Insurance From an Inferior Fund? [View article]
Chinese Yuan and the Future of U.S. Exports [View article]
The financial sector problems were just an effect from lack of exports and too high of imports. Americans cannot consume without producing and have no problems.