dla35

Everybody Hates Leveraged ETFs

I love ETFs!! Not only do they provide a cheap brad market exposure but they are the simplest vehicles available to hedge your portfolio against all sorts of market events. A combination of stocks and derivatives may provide the “best” hedge but they are expensive and complicated to set up.

I was fortunate enough to have more than 70% of my capital available during the January to March period. I started accumulating stocks and de facto reducing the unit cost of my previous holdings. Concurrently, I was hedging my position using the DXD ETF. The final result is staggering, I closed my position in DXD on the 3rd April realising a net 6% gain and my overall portfolio is up 28% YTD.

I have to agree that leverage ETFs are better used as a short term hedging than a long term investment and should be used by more experienced investors. On the other I think wealth management companies should start to make their “active” funds, actually active rather than the long-only buy and hold strategy which does not work. Those managers get paid huge amounts of money for not much work.

Tata Nano About to Give Detroit a Run for Its Money

What a flawed article this is. It implies that Tata will launch the Nano in the US in 2009. Come on Ron a bit more diligence would make this article more credible.

Tata is planning to redesign the Nano and launch a US version in about three year’s time. The 1 million reservations made are from Indian consumers!

Now don't think the US version will sell at 2k. The car will have to go through a battery of safety and collision tests, which are practically inexistent in India. The costs to improve safety will flow right through to the consumer.

There has been some enthusiasm from US consumers for the Nano but let me be a little dubious about the enthusiasm translating into actual sales. There has been an increasing trend to shift towards more fuel efficient cars but the US has never been a market for sub-compact cars. I’m looking forward to see how well the Ford fiesta sells in the US but again it is more of a compact then a sub-compact.

Treasury Stress Test Won't Add Clarity or Transparency - Just Inconsistency

Who cares about about what the optimistic or pessimistic scenario is. The main question should be whethter the results will be give a true insight on who's the strongest and who's the weakest.

If it does answer that question then you'll know who has more chances of going through your own worst case scenario.