Recently, I have been trying to develop a strategy for intermediate to long term currency investing. I had looked into three of the most well known currency investing strategies that are known to produce positive returns: carry, momentum and valuation.

One common method for using these strategies is to select three currencies to buy and three to short from the G10 currencies. The currency carry strategy buys the currency with the highest yield and sells the currency with the lowest yield to earn the difference in interest rates. In addition, studies have found that currencies with high yields have historically outperformed those with low yields so in addition to the interest there is also appreciation potential. The momentum strategy is, as its name implies, long the currencies with the greatest momentum and is short those with the lowest. The last strategy, valuation, is based on a theory called purchasing power parity.

While looking through the stock picks from my quantitative ranking systems, I came across Atwood Oceanics (ATW). Atwood Oceanics is a small cap offshore drilling services company which owns a small rig fleet.

Looking at this page it is hardly surprising that Atwood Oceanics receives high marks from my rankings system. It scores better than average on valuation and growth, and also has a solid balance sheet and high margins.

WisdomTree has quite a few ETFs that track fundamentally weighted indices, a few currency ETFs, and one US bond ETF. Now they are filed to launch three actively managed ETFs. The three funds are:

• WisdomTree Real Return Fund
• WisdomTree Managed Futures Fund
• WisdomTree Long-Short Equity Fund

The first fund’s investment objective is straightforward. Like its name implies, WisdomTree Real Return Fund attempts to achieve returns in excess of inflation This fund can invest in almost anything that protects against inflation.

The following is excerpted from my monthly newsletter.

Recently, it has been quite hard not to worry about inflation. Gas prices and many other commodity prices have risen rapidly over the past couple of months while the dollar has dropped. In addition, the spread between treasuries and inflation-indexed treasuries has increased sharply implying a higher amount of inflation. However, it is far from a sure thing that inflation has taken hold again; real estate prices are still declining.

The Rydex ETFs have not gotten much publicity, possibly because they have not launched any new ETFs recently. However, they do have some very interesting and unique ETFs.

The Rydex ETFs that I found were the most interesting were their little known pure style ETFs (RPG, RPV, RFG, RFV, RZV, RZG). They are unique ETFs that are unlike any other ETFs that exist. There are six ETFs: a value ETF and a growth ETF each for large cap, mid cap, and small cap.

Looking at current articles, news, and commentary on MarketWatch and Bloomberg, I found two interesting pieces that seemed almost contradictory.

The first from Bloomberg ("Insider Selling Jumps to Highest Level Since 2007"):

iShares has filed for some international ex US sector ETFs. They currently have US sector and global sector ETFs and so they are probably trying to fill out their line of products. The ETFs will track MSCI All Country World ex US sector indices. The ETFs iShares has filed for will compete with several other international and global sector ETFs.

The ETFs that iShares has filed for are:

There are several reasons to be more bullish on natural gas than on oil right now.

1. Chesapeake Energy Corp. (CHK) announced plans to cut natural gas production further while also resuming some oil production. When producing natural gas becomes uneconomical and enough production is cut, prices will eventually have to rise. If production of oil is resumed after being previously cut, then it likely means that the production of oil is becoming economical again.
2. The Oil/Natural Gas ratio is almost as high as it ever reached since 1994 (all the historical data I could find). When the ratio has reached the level it is near now, natural gas has always outperformed oil. This does not mean that natural gas prices rose, they just outperformed oil.
3. Industry insiders are confident that natural gas prices will rise. MarketWatch reports what Chesapeake Energy Corp. CEO Aubrey McClendon said at the Independent Petroleum Association of America.

McClendon said natural gas prices -- which have dropped to below $4 per thousand cubic feet from more than $13 during the height of the bubble -- will return to $7.50 to $9.50 possibly by the end of this year.

Much has been written about why 3x long ETFs are not for long term investments. One of the reasons given is that both the 3x long ETF and the 3x short ETF have losses since their inception.