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  • Equity CEFs: Where Are The Best CEF Opportunities Now?  [View article]

    If bargains are available and we're fully invested, would you buy on margin, or is that too risky? If the margin rate is 2-6%, depending on the brokerage, and the funds pay 8-10%, it seems like it would be fairly safe, but the unexpected can always happen.

    Oct 19, 2015. 10:14 AM | Likes Like |Link to Comment
  • 'Hell On Fire' - The 3x Leveraged Universal Investment Strategy (Part I)  [View article]
    Looking at woody's 3 previous comments on SA, he also had (as of last August) "a large position in ZIV and smaller position in XIV and a very hefty short position in TVIX." So he may be following Frank's strategy, but he's also got side investments in volatility that probably account for most of his gains.
    Apr 26, 2015. 09:10 PM | 1 Like Like |Link to Comment
  • 'Hell On Fire' - The 3x Leveraged Universal Investment Strategy (Part I)  [View article]
    Sounds great. How did you do it? According to Frank's year-end summary, his best strategy in 2014 (Maximum Yield) returned 26.25% (with hedging). (http://bit.ly/1GYaSWm) So even if you were invested entirely in that one, it's hard to see how you could get 100% return.
    Apr 18, 2015. 12:23 PM | 1 Like Like |Link to Comment
  • 'Hell On Fire' - The 3x Leveraged Universal Investment Strategy (Part I)  [View article]

    Thanks. Why do you use VFINX/VUSTX instead of SPY/TLT? Because they go back farther for backtesting?

    Apr 5, 2015. 09:56 PM | Likes Like |Link to Comment
  • 'Hell On Fire' - The 3x Leveraged Universal Investment Strategy (Part I)  [View article]
    Incidentally, I recall your mentioning in one of the comments that you decided to use the EMA rather than the SMA, because it resulted in less whiplash. Did you change your mind about that?

    Actually, the strategy seems to have changed somewhat since your article about it. Do you have any plans for another article to update it?
    Apr 5, 2015. 08:41 AM | Likes Like |Link to Comment
  • 'Hell On Fire' - The 3x Leveraged Universal Investment Strategy (Part I)  [View article]
    Hi Cliff,

    Thanks for the clarification -- I'm glad to find out about the change from the 5-day to 50-day moving average. It seems like an effective strategy for reducing risk. Considering the cautions in the article above about the potential hazards of leveraged ETFs, I'm wondering if Frank has considered your idea of the cash filters.

    Apr 5, 2015. 08:26 AM | Likes Like |Link to Comment
  • 'Hell On Fire' - The 3x Leveraged Universal Investment Strategy (Part I)  [View article]

    Cliff Smith proposed using the 5-day/200-day crossover of the SPY:TLT ratio as a signal to switch between the two (or go to cash). What do you think of that?

    Apr 5, 2015. 01:44 AM | Likes Like |Link to Comment
  • The New Enhanced Bond Rotation Strategy With Adaptive Bond Allocation  [View article]

    Thanks for publishing these strategies.

    It looks like some ETF symbols are missing in the above article:

    - "highly correlated corporate bonds: and. However a combination of with a negatively correlated treasury"

    Should probably be: "highly correlated corporate bonds: JNK and CWB. However a combination of JNK, CWB, or PCY with a negatively correlated treasury"?

    - "Bond strategy drawdowns are mostly driven by FED announcements, but they are about 3x smaller than drawdowns.

    Should probably be: "3x smaller than equity drawdowns"?

    - "Emerging-markets bonds like are quite susceptible to global sentiment"

    Should probably be: "Emerging-markets bonds like PCY are quite susceptible to global sentiment"?

    Feb 21, 2015. 01:33 PM | Likes Like |Link to Comment
  • Benefits Of Short Selling Inverse Leveraged ETFs  [View article]

    Thanks for these great articles.

    Someone pointed out above that the maintenance margin requirement for shorting 3X inverse ETFs is 90%. So it seems that if you short, say, $10k worth of SPSX, you have to keep at least another $9k in cash, and probably more ($10-15k?), to cover any spikes above 10%--which looks like it happens every few months.

    But there's an opportunity cost if you have to keep this cash uninvested. (I suppose you could invest it if you don't mind its being sold at a possibly inopportune time to cover the short.) So you might make 30% a year on the $10k you're shorting, but you also make 0% on the $10k maintenance--which means you're averaging 15%. Or if you had the $10k maintenance invested and took a loss when it was sold, that would decrease the 30% profit. Am I missing something here?

    Feb 2, 2015. 04:31 AM | Likes Like |Link to Comment
  • Equity CEFs: How To Play The Allianz Funds Right Now  [View article]
    I'm not Doug, but I'll take a crack at responding, since this is something that's occurred to me, too. I don't see any reason to avoid high-ROC funds in a retirement account. True, the tax advantage goes to waste, but the retirement account already has a tax advantage. It's no worse than having any other type of fund there. High ROC is a bonus you get in a taxable account rather than a loss you take in a retirement account. I have CEFs with high ROC in my IRA--because they're good funds. Needless to say, if there are funds with low ROC that you want to own, it would be preferable to have them in your IRA and high-ROC funds in your taxable account, but you don't actually lose anything by having the latter in an IRA.
    Oct 1, 2013. 09:31 AM | 1 Like Like |Link to Comment
  • Equity CEFs: Terrific Opportunity In A Duff & Phelps Utility Fund  [View article]
    I can understand that it's better to buy at a discount than a premium, but it seems this would really be of tangible value only if the fund is liquidated? In your earlier article today, you advise buying at a discount and selling at a premium, but isn't it also possible to lose money that way? If the NAV and market price decline while you're holding it, the market price may be above the NAV (producing a premium) but still lower than when you bought it? Is buying at a steep discount as important as waiting for a low price?
    Sep 23, 2013. 07:41 PM | Likes Like |Link to Comment
  • Equity CEFs: A BlackRock Energy Sector Fund That Gets No Respect  [View article]

    A macro-type question, if it's not too late:

    When I look at the 3- or 5-year charts for the EV funds you recommend, most of them start at the lower left and go up steadily toward the upper right, with the occasional minor dip. The chart for BOE, on the other hand, hit a high in June 2011, took a dive later that year, and, though it's recovered somewhat, is still quite volatile and has never recovered its high. It's as squiggly as a snake. This makes me nervous, and I can't see any reason to buy into it, especially if it involves selling EV funds (which I only know about because of your articles here...).

    So my question is, why the emphasis on total return compared to a benchmark when both can change so quickly (in a quarter, in fact)? Do you consider long-term chart performance? I'm not really a sophisticated investor--money talk makes my eyes glaze over--and I value your expertise, but I don't want to be trading in and out of funds all the time. I just want to buy and hold, which I recall a couple of people here commenting they've done successfully with CEFs over an extended period. So I wonder why you recommend these short-term trades based on a benchmark comparison when it could easily go the other way next quarter.
    Jul 24, 2013. 06:42 AM | Likes Like |Link to Comment
  • 14 BDCs - The Good, The Bad And The Maybe? Part 10: THL Credit  [View article]

    You say, "Below is an oversimplified table" and "In reality I use different weightings for each criterion." Could you show us what your non-simplified table looks like?

    Thanks--great articles.
    Mar 5, 2013. 12:52 PM | Likes Like |Link to Comment
  • 13 BDCs - The Good, The Bad And The Maybe? Part 9: Golub Capital  [View article]
    These articles are very helpful, Buzz--thanks.
    Mar 4, 2013. 12:55 PM | 1 Like Like |Link to Comment
  • Equity CEFs: The Insanity Of CEF Investors Revisited  [View article]
    "I believe the stock and bond markets will be running into more resistance at this point."

    In previous articles or comments, you've suggested in down markets shorting an index or buying an inverse index up to 1/3 of the portfolio. Would this involve selling CEF shares in a declining market and taking the loss to finance the short position? (I assume you're not suggesting keeping 1/3 of the portfolio in cash to be able to short or buy inverse ETFs if necessary?)
    Feb 25, 2013. 06:22 PM | Likes Like |Link to Comment