tb1975

Why Leveraged and Derivatives-Based ETFs Are Dangerous

and I wrote 'a bank in Germany,' not, 'some bank in Germany' as you quoted me


On Jul 22 11:40 AM tb1975 wrote:

> It is Deutche Bank, Germany's largest bank...ever heard of too big
> too fail?I know exactly what is going on, and I'm making money at
> it.

Why Leveraged and Derivatives-Based ETFs Are Dangerous

"Your strategy goes against everything I said in the article."

That's why I started off my post with the words, "To be contrarian..."


On Jul 22 10:52 AM Living4Dividends wrote:

> your strategy goes against everything I said in the article. These
> funds are not prudent for the long term investor. It's an ETN and,
> it sounds like you arent sure of how the funds are being managed
> "some bank in germany"

Why Leveraged and Derivatives-Based ETFs Are Dangerous

It is Deutche Bank, Germany's largest bank...ever heard of too big too fail?I know exactly what is going on, and I'm making money at it.


On Jul 22 10:52 AM Living4Dividends wrote:

> your strategy goes against everything I said in the article. These
> funds are not prudent for the long term investor. It's an ETN and,
> it sounds like you arent sure of how the funds are being managed
> "some bank in germany"

Why Leveraged and Derivatives-Based ETFs Are Dangerous

To be contrarian, I like leveraged ETFs and ETNs. Yeah, you can't invest in them and not look for a week, but with which investment can you do that with?

I own DGP. I've owned it since December '08. It is a 2X long gold fund. While gold has risen 13% since I bought in, DGP has risen 23%. Not exactly double, but not much slippage either.

I invested in it to get more return than GLD. It has done that. I also did it for tax reasons- since it is an ETN, I can hold it for a year and pay 20% capital gains rather than the gold 'collectible' rate.

I understand the risks involved. I understand it has to do with derivatives and a bank in Germany. I understand it was designed for short term trading. I don't care. I keep a close eye on it and it is making me money. I have limit orders in to protect profits. It's all good.

Commodities: Another Bubble Forming?

I meant line of best fit, of course. my apologies for the typo.


On May 29 04:39 PM tb1975 wrote:

> also, in your gold chart, I don't think you even came close to the
> line of best fir. Nearly all of the data points (gold price) are
> above your line- maybe like 90% of the data is above your silly line

Commodities: Another Bubble Forming?

also, in your gold chart, I don't think you even came close to the line of best fir. Nearly all of the data points (gold price) are above your line- maybe like 90% of the data is above your silly line

Commodities: Another Bubble Forming?

gold was up last year, not down (+3%)

Dow 3700, $3,500 Gold, $300 Oil - Enough Already

Yes, economically, it sure is.


On Mar 04 12:21 PM NanO49 wrote:

> The sky is falling, the sky is falling! ;)

Dow 3700, $3,500 Gold, $300 Oil - Enough Already

Would the author have thought $25 oil was an outrageous prediction when it was at $147 6 months ago?

How about $1000 gold when it was $300 a few years back?

How about Dow 6000 in September '07?

These predictions don't seem so absurd in hindsight, do they?

A Dow/Gold ratio of 1:1 is not out of the question. It happened in '81. It regularly gets down to 2:1 or 3:1 during garden variety recessions. You don't think $300 oil is a possibility? A time frame like 10 years might make more sense, but does it always make sense?

I remember a year and a half ago when people were making predictions about Dow 7000 or Dow 5000. People scoffed- and then promptly lost 55% of their retirement savings watching these predictions come true.